User Guide for Procurement of Works—Small Contracts: Standard Bidding Document

This User’s Guide is intended to provide guidance to borrowers on how to prepare a bidding document for unit price or lump sum types of small works contracts that incorporate postqualification, and how to evaluate bids and award contracts based on the Asian Development Bank’s Standard Bidding Document for the Procurement of Works, Small Contracts.

Advance rent mobilisation strategies of graduate renters in Ghana: a submarket of the private rental housing market

The practice of advance rent, where landlords ask renters to pay a lump-sum rent covering 2 or more years, is gaining scholarly and political attention in Africa. Nevertheless, there is limited empirical research investigating how renters mobilize funds to meet this financial commitment. Existing literature suggests that renters, irrespective of their educational level, face difficulties in paying advance rent, hence compelling them to rely mainly on their bonding (family and friends) and bridging (employers and financial institutions) social capital to pay advance rent. Drawing on rational choice and social capital theories coupled with data from a novel (graduate) sub-market of Ghana’s rental housing market, this article finds that personal savings remain the most rational current and future source of funding options graduate renters draw upon to pay advance rent, albeit some still drawing on their social capital. The findings demonstrate that graduate renters do not use bonding social capital in their future mobilization strategies after they have drawn on the same in previous years, although they continue to rely on their bridging social capital and other strategies to mobilize funds for advance rent. The study suggests the need to rethink rational choice and social capital theories to incorporate inter-temporal dynamics among different social groups and to traverse the current binary conception of the rental housing market in Ghana to consider different sub-markets and how they respond to existing challenges in the housing sector.

Alternative Contracting Approaches in Current Oil and Gas Business Environment

This paper presents a broad overview of the current state of the oil and gas engineering, procurement, and construction (EPC) contractor base following a period of challenging market conditions, subsequent owner/operator investment deferments, and the resulting financial impacts to the contractor base. These factors have caused a reduced tolerance for oil and gas volatility and a reduced appetite for lump sum contract risk. This paper identifies alternative contracting approaches to traditional competitively bid lump sum contracting. These alternative approaches result in a better understanding and assignment of risk between owner/operator and contractor, encourage continued participation by contractors in the oil and gas sector, and increase the probability of successful project outcomes.

Strategies for Successful Project Execution – A Transformation in Project Delivery without Disruption

Cost overruns on lump sum turnkey projects have challenged Engineering, Procurement, and Construction (EPC) project implementations. Several causes can be attributed to this problem but common to all is that despite significant efforts spent in planning and estimating the job, most projects fail in the execution stage. A new approach to EPC projects execution and delivery combines better management of scope brought by the Advanced Work Packaging (AWP) procedure and efficiencies from the LEAN principles of an engaged workforce that was Toyota's success in manufacturing industry can be applied to construction industry. The implementation of this enhanced process supported by a digital tool, an end-to-end platform, can be extremely useful for projects in Petroleum Industry. Methods, Procedures, Process: The approach has been designed to tackle three crucial challenges of project execution: people (company culture), process inefficiencies and data handling. The sense of inclusion, empowerment of a worker and the clarity of scope of every activity to be performed have a profound impact on the performance of the worker. It is designed to involve all stakeholders (from the owner to the last member of the crew) giving them an opportunity to contribute to the project implementation. The proposed enhancement of the processes at every stage of the project (from engineering to completion) drastically reduces the traditional inefficiencies of EPC projects which are responsible for cost overruns, schedule delays and poor quality of work. Results, Observations, Conclusions: A plethora of digital tools used today in EPC industry create a large pool of data that can be leveraged to have an insight on the projects. However, all the data produced by different and disconnected tools are still used in silo and large data available creates complexity in analyzing and interpreting it. The AWP+LEAN approach brings transformation without disruption: an automated integration with existing systems used in the organization can be established in order to collect, give consistency and synchronize all the available information hassle-free. The novelty of the approach presented in the paper compared to the other practices is its non-disruptive nature. The idea is to combine in a consistent fashion, all the information collected during the project by different tools and orchestrate them to provide a deep insight and granular visibility to the project. This means that there are no switching costs for the EPC companies and less resistance from people in adopting the new processes, making the journey to improvement easy and smooth.

Novel Motor Adjusts Bend Setting Downhole, Addressing Today's Directional Drilling Challenges

Previously, few options existed for the complex directional challenges. Drillers either needed to rely on multiple Bottom Hole Assemblies (BHAs) or use expensive drive systems, which resulted in increased operational cost and limited drilling flexibility. This novel Downhole Adjustable Motor (hereafter referred to as downhole adjustable motor or the motor) described in the paper addresses these limitations by enabling the driller to change the motor bend in real-time downhole. In addition, the motor can deliver up to 1,000 horsepower (HP) at the bit during rotary drilling—the highest power in its size range. This paper will review how, even in harsh drilling applications, the downhole adjustable motor has proven to save trips, increase bit life, reduce lateral vibrations and stick-slip, and allow for drilling optimization to increase Rate of Penetration (ROP) and decrease overall drill time. Whether for drilling contracts or lump-sum turnkey projects, the directional drilling industry benefits from this new technology's ability to improve drilling economics while increasing safety by reducing drillpipe tripping and additional BHA handling.

Reducing ABEX Uncertainties through Hybrid LSTK Contracting: A Factory EPSm Pilot Case Study in South East Asia

Well abandonment and the associated abandonment expenditure (ABEX) are necessary stages in the post cessation of production (Post COP) phase of the asset lifecycles. There are significant risk factors present, which vary in the frequency and severity based on a multitude of factors pertaining to environment, age, well construction techniques and stratigraphy, to name a few. In the case of well isolation and abandonment operations there are opportunities to innovate through factory project execution techniques and commercial approaches, which are enhanced where standardization and commonality of well architecture is present. These techniques focus on reducing risk factors and creating value where conventional thought suggests there is marginal cashflow benefit, in asset retirement obligation expenditure. Through a reduction in the total cost of ownership (TCO), project financial performance below the estimated provisions, can unlock cashflow from relief adjustments on long term liabilities. The Engineering, Procurement, Services management (EPSm) lump sum partial turnkey contracting approach was developed to assist operators in unlocking cashflow in ABEX provisions, through risk reduction via front end well engineering and integration of service provision, allied to fixed price lump sum contracting to control project cost creep due to unforeseen events. A pilot project was undertaken in South East Asia, delivering 64 permanently abandoned wellbores in 38 consecutive days, representing over 8,300-man hours and over 3,500 operating hours. The EPSm contracting approach delivered lump sum partial turnkey well abandonment services in a high-volume factory well abandonment retirement environment. Operations were executed through a dedicated jack-up drilling rig trimmed to an asset retirement specification to reduce OPEX and increase efficiency. The operational project framework implemented pre-abandonment offline operations prior to rig arrival, then simultaneous operations (SIMOPs) concerning 2 primary worksites: the wellhead platform weather deck and the jack-up rig cantilever. Standalone concurrent Phase I slickline operations comprising of two units, were performed offline on the wellhead platform with pressure control equipment to execute primary reservoir isolation operations. Phase II & III operations were executed above, on the jack-up rig cantilever through the drilling riser and pressure control equipment, executing the overburden and surface isolation operations, minimizing online operating time of the jack-up rig. Key Learnings from the pilot project are presented, along with pilot project key performance indicators. The project learning curve, and human performance factors provide insights to areas where there are synergies and opportunities to further reduce risk and the total cost of ownership through an Engineering, Procurement, Services management (EPSm) contracting approach.

An investigation of private public partnerships using real options analysis

<p>This thesis develops a model that investigates aspects of New Zealand’s largest public-private partnership project, the rollout of Ultra Fast Broadband. The model features four cities with different demand and construction-cost characteristics. It is used to study the different choices of the private party (Chorus) and the public party (Crown Fibre Holdings (CFH)). Using a real options approach, we identify two sorts of potential conflicts between the two parties: a timing conflict about the number of cities the two parties would like to develop in each period and a sequencing conflict about the order in which the UFB network is rolled out in different cities. Inspired by the incomplete contracting and information asymmetry literatures, we introduce several incentive schemes (including four subsidy schemes and two fine schemes) that help manage the possible conflicts. We compare both their ability to reduce the conflicts and their sensitivity to the model’s underlying parameters. Overall, there are four main findings. First, the magnitude of the conflict is a non-monotonic function of the inter-city demand differences and the inter-city construction-cost differences; it is an increasing function of the ratio of consumer surplus to producer surplus and of demand volatility. Second, a demand-dependent lump sum subsidy has the best performance among all included incentive schemes in controlling the possible conflicts. Third, the conflict level becomes quite sensitive to the subsidy scheme in two cases. A) When either the inter-city demand differences or the inter-city construction-cost differences turn out to be modest; B) When either the ratio of consumer surplus to producer surplus or demand volatility turns out to be large. The above result may provide some suggestions in managing the optimal subsidy. Last but not least, the requirement that Chorus is willing to participate in the partnership means that the fine schemes are generally outperformed by the subsidy schemes. Relating our findings to the undertaking UFB project, we provide CFH with several practical suggestions that may improve its management of possible conflicts.</p>

An investigation of private public partnerships using real options analysis

<p>This thesis develops a model that investigates aspects of New Zealand’s largest public-private partnership project, the rollout of Ultra Fast Broadband. The model features four cities with different demand and construction-cost characteristics. It is used to study the different choices of the private party (Chorus) and the public party (Crown Fibre Holdings (CFH)). Using a real options approach, we identify two sorts of potential conflicts between the two parties: a timing conflict about the number of cities the two parties would like to develop in each period and a sequencing conflict about the order in which the UFB network is rolled out in different cities. Inspired by the incomplete contracting and information asymmetry literatures, we introduce several incentive schemes (including four subsidy schemes and two fine schemes) that help manage the possible conflicts. We compare both their ability to reduce the conflicts and their sensitivity to the model’s underlying parameters. Overall, there are four main findings. First, the magnitude of the conflict is a non-monotonic function of the inter-city demand differences and the inter-city construction-cost differences; it is an increasing function of the ratio of consumer surplus to producer surplus and of demand volatility. Second, a demand-dependent lump sum subsidy has the best performance among all included incentive schemes in controlling the possible conflicts. Third, the conflict level becomes quite sensitive to the subsidy scheme in two cases. A) When either the inter-city demand differences or the inter-city construction-cost differences turn out to be modest; B) When either the ratio of consumer surplus to producer surplus or demand volatility turns out to be large. The above result may provide some suggestions in managing the optimal subsidy. Last but not least, the requirement that Chorus is willing to participate in the partnership means that the fine schemes are generally outperformed by the subsidy schemes. Relating our findings to the undertaking UFB project, we provide CFH with several practical suggestions that may improve its management of possible conflicts.</p>