Contract Management in Offshore & Marine, EPCIC, and Shipyard

Introduction:

For complex offshore and onshore projects, the preferred contract module used is the EPCIC (Engineering, Procurement, Construction, Installation & Commissioning) Contract. Understanding the allocation of risk by mastering the ins and outs of EPCIC contracts will prove to be a valuable tool in driving effective contracting strategies to minimize liabilities

Targeted Groups:

• Commercial Contract Professionals
• Commercial Operation Professionals
• Contract Engineers
• Procurement Supply Chain Professionals
• Risk manager / Contract Risk Professionals

Course Objectives:

At the end of this course the participants will be able to:

• Understand the current global, local and financial environment for EPCIC contracts and assess operational, commercial, legal and financial risks in EPCIC contracts
• Examine and analyze the difference between with EPCIC contracts & EPCM and appreciate the underlying legal principles
• 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 the project lifecycle and how to tackle these through enforceable contractual clauses
• Avoiding drafting pitfalls and ambiguous contractual terms
• Have a one-stop reference on all aspects of the contracts and for dealing effectively with the problems that may arise
• Obtain detailed guidance on the contract management techniques that will help the reduce claims
• Familiarise themselves with different contracting clauses
• Deal with Changes to contract terms, and differences in approach between standard contracts and bespoke contracts

Targeted Competencies:

• Putting EPCIC in the context of 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; managing contractor concerns

Course Content:
Unit 1: EPCIC Overview, Legal Framework & Contract Structure and Risk Allocation:

• Maximizing Parties Rights and Interests with Appropriate Contracting Strategy
• Contractor’s Single Point of Responsibility
• Split Contract Structures
• EPCIC Aspects in Shipbuilding Contracts for “Floaters”
• Choosing the Right Contract Structure for Your Project
• The Tender Process, Tender, and Award. Discussing and Analysing Different Strategies

Unit 2: 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?
• Finalizing 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

Unit 3: 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 Issues Faced During Contract Life Cycle by Aligning Contractual Terms to Project Management
• Managing Coordination Issues
• Handling Completion Issues
• Liquidated Damages
• Dispute Resolution
• Enforcing of Commencement and Completion Dates

Unit 4: 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
• Using Contractual Clauses to Manage Liabilities and Risks

Unit 5: Contract Completion – Critical Issues:

• Acceptance of Punch List of Defects - What is the effect?
• Passing of Title and Risk - Safety & Insurance
• Warranties and Guarantees
• Passing of Intellectual Property Rights
• Defects - Exculpatory Clauses
• Dealing with Disputes – considering the different options