RISK ANALYSIS AND RECOMMENDATIONS TO IMPROVE THE LOGISTICS COST PERFORMANCE OF THE EPC PROJECT AT REMOTE AREA

: The EPC and construction projects generally have a high level of complexity, and uncertainty. The changes that have occurred in the engineering, construction, control systems, and sub-logistics stages will impact logistics cost performance and finally affect the project margins, weak of project control, and high risk. The purpose of this study is to determine the variable risk that affects the performance of logistics costs, to obtain high-risk identification of engineering, construction, and system control variables that affect the performance of logistics costs and to determine the risk responses and recommendations to improve logistics cost performance on EPC projects in remote locations. Data was collected from literature studies, interviews with respondents, and experts. By 51 respondents' answers, the risk was identified are 30 factors in terms of the probabilities and impact. The method through descriptive analysis, validity & reliability testing, and qualitative risk analysis. Further, the follow-up of risk results would carry out through proactive and reactive mitigation. This research found 7% of the variables were extreme, and 93% were high-risk categories. Thus it indicates that all variables affect the logistics costs performance where the remote project locations are one of the main factors in increasing the logistics costs.

Not a few EPC project locations are for oil & gas or industrial plant far from urban areas, far from tools and human resources.
The complexity of the EPC project has a relationship between one process and another. This has the potential to cause multiplier impacts if one of the processes undergoes a change in planning, scheduling, technical, quality, etc., which will affect the other functions, such as procurement, construction, and commissioning.    Research contribution to science is as the evaluation material for companies in implementing strategies for tenders in remote areas and in the long term to get better productivity, as input for the strategy and commercial preparation in the tender stage, and as the lesson learned for projects located in remote areas, they can take steps to prevent cost overruns and can help companies increase profits.

Cost Structure of EPC
Cost management is one of the most fundamental criteria in determining the success of an EPC project, so it must be managed and controlled throughout the project life cycle. Depending on the project type, the material costs can represent range from 30% to 70% of the total project (Donyavi, et al., 2009).
According to Indirect Construction 2431 | Risk Analysis and recommendations to improve the logistics cost performance of the EPC Project at remote area Costs (IDCC), The cost can represent 10-40% of the total project cost or more of the total construction project cost, depending partly on the type and nature of the project.
Pulver also identified that the company's OH ranged between 8% and 15% of the total annual construction volume. As reported in the United States, OH companies generally account for 2.5% to 10% of the annual construction volume (Popescu, et al., 2003).
As general from the above description we can resume that:   (Bahagia, et al., 2013).
One element of construction project resources that is very vital is material. One of the reasons for the many construction failures is the material logistics management process that is not optimal (Prahuhub, 2021).
The causes that generally occur as a result of an increase in logistics costs are: • • There was an interface problem between the contractor and the equipment supplier, client, material supplier, and subcontractor .

Factors Affecting The Logistic Cost
Project delays will impact extensions, and extensions will increase costs (Protocol, 2017 (Ekeskär, et al., 2016).

Project
The logistical problems in the EPC project will have an impact to: •

METHODS
The method that will be used by researchers is risk-based analysis. Then the data is processed qualitatively to get the level of risk. The risk level will be analyzed where the sub-variable items only have extreme and high-risk categories.

RESULTS
The results of a survey of 51 respondents showed that engineering, construction, control systems, and sublogistics variables had an impact on cost performance. The questionnaires involved job levels from staff to project managers.

DISCUSSION
The purpose of this research is to find out which sub-variables influence the logistics cost performance and has a major affected on the overall cost performance. • Research on project risks is very effective in making decisions to reduce the level of risk exposure of construction projects (Marle, 2020).

CONCLUSIONS
From the presentation of the data above, it can be concluded several important notes from this paper, namely: • The projects are located in remote areas, having good planning is mandatory because not all materials are available at the local site, especially since the materials are delivery from abroad. the plan includes a project execution plan, engineering execution plan, procurement execution plan (warehouse, delivery, and site facility location), construction execution plan, and project control execution plan.
• The use of digitalization and integration system for the implementation of EPC projects is vital to minimize problems -A strategic decision from the Project Manager by considering the schedule and impact delay.(*B) -Involvement of a lead/senior engineer is required for the design review process.. (*C) -Before shipping, it is necessary to carry out a Pre-Inspection to ensure that the packing handling and transportation are in proper condition. (*C) -Create a expediting plan, make coordination with vendors and the use of an integrated system. (*C) -Identification of the material/equipment arrangement on vessel and review the process of lifting and unloading material at the jetty can run smoothly, especially for materials/equipment that have large dimensions. (*C) -Make Coordination with the logistics to find out the shipping capacity. (*C) -Required management meeting for the activity to be carried out in the next 2 / 3 weeks. (*P) -Analyzing vendor schedules and logistics routes including roads, jetty, transportation, and permits mainly for the equipment that has large dimensions when access through remote locations. (*P) Pro Active

RISK COST
Construction delays, purchase costs for materials, warehouse, packing handling and transportation

RISK LEVEL High FOLLOW UP PLAN
Reactive -Inspection is required before the material arrived at the site, including packing & handling, and transportation of the vehicle used. (*S) -Carry out the selection & evaluation of logistics transportation by assessment selection criteria. (*S) -Collaborate with suppliers/vendors regarding alternative routes and cooperate with the local police/transportation agency, for example, opening and closing main routes. (*S) -To minimize material damage, a supervision is required by the vendor/supplier for inspection of packing material. (*S) -If possible before the material delivery to site, it is necessary to place materials consolidated in one place, then use a transportation lease to send materials together. (*S) -Delegating and coordinating with generalship logistics related to material dimensions so that the unloading process can run smoothly. (*S) -Conduct a review of the material on-site. engineering drawings and involving construction experts. (*C) -Involvement of construction experts to review 2447 | Risk Analysis and recommendations to improve the logistics cost performance of the EPC Project at remote area that occur in the engineering, procurement, control system and sublogistics implementation processes.
• The use of lessons learned and project databases is very important to use as a basis for a proposal's budget plan.
• Being sharp in reviewing and finding disputes / deviations / battery limits / gray areas in invitation to bid (ITB) documents is one of the factors in project cost control.
• In the case of a tender for a plant that has a high level of difficulty or  (Muha, 2019).