Book Chapter
Managing risk in operations
D Power, D Samson
Operations Management: An Integrated Approach | Cambridge University Press | Published : 2008
Abstract
Consider the risks faced by the Malaysian oil and gas company PETRONAS. This company explores for oil and gas and then develops these assets into operating refineries and downstream petrochemical plants. In addition it operates pipelines all over the world and a large fleet of ships. Some of the risks this company faces include: When PETRONAS explores by drilling for oil and gas, up to $100 million can be spent in any location, with a relatively low probability of success in finding significant deposits (only about one in eight developments is successful overall).