Project Level Services (4 of 9)

Cost risk assessment

Schedule risk assessment

Project risk tools

Risk Manager assistance

Contingency planning

Project Risk Management

Project Risk Management (PRM)

Description;
- PRM is a systematic approach of analysing and managing threats and opportunities associated with a projects objectives typically cost, time and performance.

Deliverables;
Ranking of most important project risks Identification of mitigating actions Cost and schedule distribution Assessment of project buffers and contingencies

Approach
- Integrated with project management - Brainstorming and interviews - Checklist and lessons learned

Methods/Tools
EasyRisk Manager @RISK Crystall Ball Pertmaster

Case - Project risk management

Client: Shell Critical Issue:
- Varying risk management practices in project field developments - Cost over-runs and schedule delays

DNV Solution:
- Develop risk management procedures - Develop an risk management tool for identification, assessment and follow-up (action tracking) of risks. - Implementation in 20+ projects worldwide

Value Delivered:
- Corporate procedures for project risk management - Increased level of management in project developments, resulting in reduced likelihood for project delays and costoverruns

Case - Naval Strike Missiles Cost Risk

Client: Royal Norwegian Navy Critical Issue:
- Final approval by the Norwegian Parliament - Significant cost and schedule uncertainty related to development of new missile technology - What is appropriate budget contingency?

DNV Solution:
- Assess uncertainty in time and cost estimates for project baseline - Identify and assess probability and impact of unexpected risk events - Estimate uncertainty and required confidence level in total project costs using an integrated cost/schedule model, incorporating the effect on cost from schedule delays - Identified the most important risk drivers and evaluate risk-reducing measures

Value Delivered:
- Enhanced insight in project risk drivers - Recommended budget with required contingency

Case - IC4 Train Procurement Schedule Risk

Client: DSB (Denmark) Critical Issue:
Significant delays to target delivery date Impact on DSB operations and reputation Strained relationship between DSB and supplier When will commercial IC4 operations start?

DNV Solution:
- Independent review of project status and schedule risks related to engineering, production, testing and implementation phases - Estimate expected project completion date and related uncertainty - Identify key drivers and communicate results

Value delivered
- Management focus for risk mitigation - Confidence in revised target completion date - Enhanced communication and trust between project partners

Project Level Services

Fitness for Purpose

Yard Assurance

Fi

tness for urpose

Yard Assurance Concept Development Concept Development

Maritime Business Risk Management

Maritime Business Risk Management

Description:
- Providing assistance to the maritime industry in managing assets

Deliverables:
- Fitness for purpose assessments
Project due diligence Vessel and fleet assessment Design Support Drawing Appraisals

- Yard Assurance:
- Contract services - Bid Evaluations - Yard capability assessments (including recycling yards)

- Concept Development:
- Development of design visions, assessment of design feasibility, development of overall concept policies - Improvement of performance, efficiency & handling - Assess effect of changes to markets, ship design and frameworks

Project Level Services

Independent review

Lenders advisor

Overall risk picture

Construction monitoring Operations monitoring

Project Due diligence

Project Due Diligence (PDD)

Description;
Independent Expert review of the following project documentation: - Technical - Safety - Environmental - Commercial - Contractual

Deliverables;
- To provide our Clients with a improved understanding of the risks and risk mitigations and support them with their LNG investment decision - To establish that a reasonable approach has been taken in respect of such factors such as design, technology construction and maintenance life cycle and costs

Approach
- Independent assessment - Stakeholder interviews - Document review

Methods/Tools
Cost modelling @RISK Crystal Ball Pertmaster

Case - Snhvit Investment risk assessment

Client: Petoro Critical Issue:
- What is the actual risk exposure in Snhvit field? - Is the current cost estimate realistic? - What is best-practice risk assessment for investment projects?

DNV Solution:
- Integrated risk model of the Snhvit development - Assessment of risk against cost, schedule and financial performance (NPV, IRR, etc.) - Identification of key risk drivers

Value Delivered:
- Supporting the Client's role as an active partner in the Snhvit licence - Enhanced the Client's in-house capacity to assess uncertainty associated with future investments (farm-in evaluation)

Project Level Services

Investment risk

NPV assessments

Concept selections

Valuation of flexibility

Valuation of real options

Value Chain Assessment

Value Chain Assessment (VCA)

Description;
- Assessing the total risk of an investment in a lifecycle perspective
$
Start production
REVENUE

Deliverables;
NPV of investment Total risk assessment Concept selection Cost-benefit of alternatives Risk sharing
CAPEX

OPEX

Time

RISKEX

RISKEX

Approach
- Technical, economical and performance studies - Concept studies - Cash flow model of life cycle

Methods/Tools
- USER (Understand-Simplify-EvaluateRecommend) - @RISK - Crystal Ball - EXTEND

Case - Risk assessment of value chains

Client: Nordea Cards and Consumer Credit (Norway) Critical Issue:
- Nordea Cards and Consumer Credit has had a phenomenal growth over the last few years - The value chains have been extensively changed the last two years - The ambitions and potential for future growth are high - This growth must be supported by efficient and effective processes

DNV Solution:
- Apply a structured approach for risk analysis of the central processes in the value chains

Value Delivered:
- Transparent and traceable risk analysis of important processes in the value chains for Card products and services - Comprehensive recommendation of projects that address the main challenges in the value chains

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This reference is approved by Nordea