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2015 ARKH-P6-Project Management

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PROJECT CONTRACTS

Contract Award Process

PRESELECTION STEP/ MARKET SURVEY

Pre-selection means: thorough analysis of selected companies to check their capabilities to perform: technically, structurally, availability of means and personnel, reference for similar jobs.

The pre-selection process is not always needed (the company may have already enough experience of a specific market).

But it can be a very useful step when the knowledge of the potential contractor/supplier is insufficient.

The process may last several months: preparing a list of companies and a questionnaire , checking their data, visiting some of them if necessary, obtaining management approval for the final list.

21

PROJECT CONTRACTS

Contract Award Process

HOW TO PERFORM THE PRESELECTION ?

Preparing the questionnaire:

Contractor side :all details, organisation ,references, consortium? JV? ….

Company side : why such a questionnaire, project description ,scope of the potential contract

The points to be clarified: competences, expertise, means, premises ,..

How and when to answer

Contacting potential contractors, checking their willingness to answer. Recommendation for consortium.

Confidentiality

22

PROJECT CONTRACTS

Contract Award Process

INSTRUCTION TO TENDER

The document is to present the procedure to be followed by the potential contractors to submit their proposal to the Client adressing following aspects :

Definitions: tender, tenderer, work…..

Acknowledgement by tenderer

Closure date

Conditions of tender: cost of tender, partial or full answer, company acceptation and right to reject, …

Bid bond

confidentiality

Conditions for alternative tender

Validity of the tender

The way to take exceptions to the Company’s requirement

Clarification procedure

23

PROJECT CONTRACTS Contract Award Process

Tendering Procedure

 

 

 

 

Prequalification of potential Tenderers

 

 

 

 

 

4 to 8 months

 

Preparation of the call for tenders (by client)

 

 

 

 

 

 

 

Conditions for tender preparation & issue

 

 

 

 

 

 

 

 

Contract conditions (clauses, prices, etc…)

 

 

 

 

Scope of work and specifications

 

 

 

2 to 6 months

 

 

 

 

Tenders preparation (by Tenderer)

 

 

 

 

 

 

 

 

Technical and commercial

 

 

 

 

Competition analysis

 

 

 

 

Positioning and tender submission

2 to 4 months

Tenders analysis (by Client)

Receipt and formal opening

Comparison

Clarification meetings

Additional submissions

Evaluation and recommendations

??Decision

24

PROJECT CONTRACTS

Tendering Procedure Opening of the Tenders

Several philosophies exist for Tenders opening:

 

 

 

 

Technical and

Updated tenders

 

 

contractual

 

 

 

 

 

Analysis, clarifications,

 

Recommendation

 

 

 

 

confirmations

 

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Same opening date

 

 

Commercial

 

 

 

Short

 

 

 

 

list

 

 

 

Updated tenders

 

 

 

 

 

 

 

Technical and

Analysis, clarifications,

 

Lowest bid

contractual

technical confirmations

 

 

selected

 

 

 

 

 

 

 

 

 

 

 

Technical opening date

25

PROJECTS CONTRACT

Contract Award Process

.

FINAL SELECTION

 

Opening of final tenders and selection of the Contractor

After having checked that each tenderer has accepted (through his initialling) the Contract conditions, the Operator opens the commercial proposals.

The selection is made in principle on the lowest price basis, or at least on the most economical solution, based upon “Life cycle cost” (OPEX +CAPEX)

If it is not the case, the Operator is usually requested to document his decision, (detailed scored evaluations)

To accept at the last minute an uncontrolled price reduction from one contractor outside the normal competitive procedure would be :

Risky, as the Contractor will probably try to recover such reduction during the performance of the Contract

Unfair to the other Tenderers (and counter-productive for next project)

26

PROJECT CONTRACTS

Contract Award Process

AWARDING THE CONTRACT

Through a preliminary agreement (MOU, letter of intent)

With conditions precedent (i.e. subject to state agreement)

Full and definitive signing

27

PLANNING & PROGRESS CONTROL

THE PLANNING FUNCTION: WHY ?

To determine the time required to achieve a Project

To optimize the cash flow in line with the Project requirements To provide the economics with schedule information

To follow-up the mobilisation of means (human resources and equipment To identify any potential deviations from the initial planning

To quantify the current progress (i.e. monthly percentage) To forecast the future taks and events

At any time during the project life

28

PROJECTS CONTRACTS: WBS (Work Breakdown Structure)

TYPICAL

PROJECT

Major Work Split = M.W.S.

BASIC

PLTF1

FPSO

Work Unit = W.U.

Onshore

Offshore

Jacket

Deck

Hull

Topsides

Onshore Plant

Links

Unit 1

Wharf

Pipeline

S/S Cable

SPS

X-Tree

Manifolds

Sub Work Unit = S.W.U.

Engineering

Engineering

Procurement

L.L.I.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

details of SWU

 

 

 

 

 

- Process Design

 

 

 

 

 

 

- Safety

- L.L.I. 1 (TC's)

 

 

 

 

- Pressure Vessels

- L.L.I. 2

(TG's)

 

 

 

 

- Civil Works

- L.L.I. 3

(Pumps)

 

 

 

 

- Structure

- etc...

 

-Piping / Install

-Valves / mater.

-Mechanical

-Electrical

-Instrumentation

-Control System

-Architectural

-Telecom

-Package

-Protection Insul.

-Links / Pipelines

-Naval architect.

-Procurement

Onshore

Transportation

Installation

Offshore

Commissioning

 

Construction

 

 

Construction

 

 

Prefabrication

 

Prefabrication

Preparation

 

 

 

 

 

Decommissioning

 

Decommissioning

Realisation

 

Erection

 

 

 

Off-Shore Works

 

- On-Shore

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

- Off-Shore

 

 

 

 

 

 

 

 

 

 

 

-Equipment

-Civil Works

-Structure

-Piping

-Electrical

-Instrumentation

-Architectural

-Painting

-Insulation

-Mech.Complet.

-Equipment

-Civil Works

-Structure

-Piping

-Electrical

-Instrumentation

-Architectural

-Painting

-Insulation

-Mech.Complet.

29

PLANNING PREPARATION

Planning (or scheduling) is one of the fundamental task and tools of the Project Management.

A Bar Chart is the most common way to schedule a project by non specialist.

A Bar Chart is easy to prepare, easy to read.

But a bar chart is not enough to evaluate a complex sequence of tasks.

A Bar Chart is totally insufficient to schedule a project.

A Pert network or CPM is in fact the only way to have a realistic view of a project, then bar charts can be produced from the network.

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