A Structural Equation Modeling-Based Project Management Framework: A Way Forward to Oil and Gas Exploration and Production Project Success

The exploration and production (E&P) projects of the oil and gas (O&G) industry are typically considered hazardous and complex due to tight timeframes, environmental issues, and geological uncertainty. No substantial research has been carried out to deal with these issues previously. The current study emphasized the empirical investigation of numerous success factors that affect both the project success and financial performance of E&P projects. Critical success factors for the project performance have been identified from the literature and pilot survey conducted in the O&G sector of Pakistan. A framework has been developed using identified factors including project team, production planning and control, performance success and financial overview. For the validation of the developed model, confirmatory factor analysis has been used with a sample of 247 industry experts. The results of this study offer substantial empirical evidence that the project team, production planning and control, quality and reliability, and project success have a significant impact on the financial performance of E&P projects in the oil and gas industry. Project team has been observed as the most significant factor influencing project success among other factors. The research findings of this study can be advantageous for project managers to address aspects intended to cope with uncertainty at the early stages of E&P projects using an empirically validated framework.