For complex offshore and onshore projects the preferred contract module used is the EPCIC (Engineering, Procurement, Construction, Installation & Commissioning) Contract. Though it is the preferred method it is not without its issues and mastering the ins and outs of EPCIC contracts will prove to be a worthwhile endeavour in minimising risks and liabilities.
This workshop is specifically designed to address the key issues as it relates to all the parties involved in the contract and as to the best means available to allocate and manage their risk and liabilities. Under an EPCIC model the main contractor carries the risks for the project, they must, at the same time minimise these risks through effective contracting strategies.
The Masterclass is specifically designed to provide participants with a well- tested and practical guide.
- The different models of EPC Contracts,
- The inherent risk, liabilities and benefits of employing various contracting strategies
- The challenges of EPCIC lump sum contracts and the ways to manage cost over-runs,
- Structuring the contract to address the issues of the several parties to the contract to ensure a positive project outcome. Pros and Cons of the split EPCIC contract form.
- Insights into the current issues affecting EPCIC contracts like pollution, HSE and local content.
Participants attending the programme will:
- Understand the current global, local and financial environment for EPCIC contracts
- Examine and analyse the difference between with EPCIC contracts & EPCM and appreciate the underlying legal principles.
- Assess operational, commercial, legal and financial risks in EPCIC contracts
- Appreciate the essential element of the different contract stages from pre to post tender to completion and delivery of project.
- Address key issues faced during project lifecycle and how to tackle these through enforceable contractual clauses
- Avoiding drafting pitfalls and ambiguous contractual terms
- Contract / Project Professionals
- Commercial Contract Professionals
- Commercial Operation Professionals
- Contract Engineers
- Procurement supply chain professionals
- Risk manager / Contract Risk professionals
This interactive Masterclass will provide the participants an ideal opportunity to improve and sharpen their skill sets in planning, negotiating and managing EPCIC contracts through interactive session with role playing, case studies, discussion groups and scenario building and the high-point of the masterclass being a simulation exercise of an EPCIC contract negotiation involving interactive role play by the participants. The objective of the interactive role play is to enable participants to apply the knowledge and understanding gained at the workshop to negotiate a more effective EPCIC contract. This will help participants gain practical insights into managing the risks and enhancing their rewards.
- Introduce participants to various types of EPC Contracts.
- Explain a typical lump-sum turnkey contract, its implications and challenges.
- Managing the inherent risks along with insights into the latest issues.
- Facilitate an interactive programme with substantial time given for case studies.
- Negotiation Strategies for effective EPC contracts.
- Risk Management in EPC contracts.
- Companies will have a contract and project team skilled in EPCIC contract management
- Better execution and project management to minimise risk and delay
- Safeguard the projects essentials and maintain contractor relationships for long term success and efficiency
- Achieve the project goals in line with company’s overall objectives
The Course Content
EPCIC Overview, Legal Framework & Contract Structure and Risk Allocation
- Maximising parties rights and interests with appropriate contracting strategy
- Contractor’s single point of responsibility
- Split contract structure
- Exercise in choosing the right contract structure for your project
- Exercise in preparing for the tender exercise, tender and award. Discussing and analysing different strategies
Tender Process Leading to an EPCIC Contract
- Legal, Technical and Commercial Pre-Qualification of tenderers
- Best practices in tender evaluations and selection of tenderer
- Important of scope of work and specifications and terms and conditions
- Exceptions – what to accept and what to deny
- Finalising tender negotiations & Award –
- LOI and LOA essential terms and legal effects
- Exercise on the selection process and main elements to ensure a successful tender exercise
Negotiating Essential Contractual Terms of EPCIC Contracts
- Identifying critical issues in the project life-cycle
- Managing cost impact clauses like delay, price fluctuations
- Indemnities and other liabilities, MAC clauses, HSE
- Changes in Law and regulations in host country & stabilization clauses
- Political Risk Insurance
- Force Majeure & Termination for cause and without cause
- Case study & drafting exercise
Essential Aspects of Risk Management Strategies
- Design, Technology & Process Risk
- Procurement & Specification risk
- Variations and cost impact
- Payment and multi- currency contracts
- Delay and liquidated damages
- Completion and testing & effects of acceptance
Contract Completion – Critical Issues
- Acceptance of punch list of defects - What is the effect?
- Passing of tile and risk - safety & insurance
- Warranties and Guarantees
- Passing of Intellectual Property rights
- Defects - Exculpatory Clauses
- Dealing with disputes – considering the different options
- Discussion on issues participants have faced and how it was handled
- AZTech Certificate of Completion for delegates who attend and complete the course