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T&T Pa­tri­ot­ic

His­to­ry is re­plete of ex­am­ples of na­tion­al, state, and pri­vate sec­tor projects that have been dis­mal fail­ures. In the case of the pri­vate sec­tor projects the share­hold­ers/in­vestors bear the loss and in the case of na­tion­al and state projects the pop­u­la­tion/tax­pay­ers bear the loss. From the lessons learned from a re­view of ma­jor mega projects the fail­ures can of­ten­times be traced to a weak de­ci­sion-mak­ing process.

A re­view of the Fly­vberg Data­base For Project Cost Risk1 which as­sess­es the risk of cost over­runs for 25 dif­fer­ent project types based on a re­view of 16,000-plus projects, for the cat­e­go­ry of oil and gas projects the base rate cost over­run is 34 per cent with a 19 per cent chance that the ac­tu­al over­run will be 121 per cent. In a very glob­al­ly com­pet­i­tive sec­tor like oil re­fin­ing, get­ting close to a 34 per cent over­run on costs is like­ly to dri­ve a project in­to fail­ure far less for an over­run of 121 per cent.