Uncertainties related to capital projects in the process industries have increased dramatically over the past three years. Brent crude prices have fallen precipitously to around $65/bbl, while the costs of capital expenditure (capex) projects in the upstream sector are estimated to have increased approximately 10-13% per year. In construction contracting, uncertainty increases cost because estimators must add contingencies to protect their bids from unknown conditions. As the process industry seeks to contain capital costs, many of the causes will be difficult to corral, while the volatility of oil and gas prices makes planning difficult. According to a recent study from
