Control: 3.A.3 Transparent Value/Cost/Risk Trade-offs Made
| Title | Description |
Context |
To make quality decisions on the development of scope, it is essential to understand the value/cost/risk trade-offs that can be made. Creating a value/cost/risk trade-off staircase is a way to depict the build-up of opportunity value transparently, starting with the minimum technical scope as the base. The staircase promotes discussion on which elements to include in the competitive scope and the scope options to be regretted. It also promotes discussion on what Ultimate Recovery (UR), Net Present Value (NPV) or Value/Investment Ratio (VIR) can be afforded within the target set. The staircase should include the impact on Greenhouse Gas performance as well as economics to illustrate the likely trade-offs. Use the value/cost/risk staircase and consider the impact on the value drivers against different opportunity realisations, decisions around what value is to be pursued and what value will be regretted can be made. The key activity for the Assess phase is to decide on the value range to be delivered and the risk and uncertainty management strategies to be pursued. |
Activity |
Build and use value/cost/risk trade-off staircases to articulate the recommended feasible concept(s). These should explicitly include Greenhouse Gas performance metrics and Respecting Nature commitments. |
Purpose |
To ensure the opportunity selects feasible concept(s) to deliver best value at the lowest cost, while balancing risks for Shell and its stakeholders with the appropriate balance of economic and Greenhouse Gas performance. |
Requirements from other Standards |
None |
Evidence recorded in |
Feasibility Report |
Accountability for meeting Control Intent |
Front End Development Manager |
Phase |
Assess |