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Some construction projects suffer from budget overruns and late completion…
Some construction projects suffer from budget overruns and late completion. Discuss possible causes of these problems and measures that could be taken to minimise their recurrence on other projects.
Intro - Commercially companies want to make profit on projects
Project Finance
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Accurate estimates of costs – needs a good understanding of what is involved in a project, including risks. Allowance for contingencies.
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LATE CHANGES
Proper planning, engineering, investigation of options is required at the start to avoid need for changes. Costs of changes increase with time.
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Use of Value Engineering to optimise design – but not too late. e.g. On CTRL it has caused a delay in design information. value engineering exercise before tender
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TENDERING & PRE QUAL
Should be based on quality, safety record and not just on price.
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CONTRACT TYPE
Adversarial contracts cause disputes and delays / cost increases. Different objectives prevent everyone working as one team.
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advocating teamworking shared objectives such as Target Price, use of Engineering and Construction Contract – joint resolution of problems and better planning such as use of programme.
UNFORESEEN CONDITIONS
Ground, services, water – e.g. El Salaam Syphon and stones / KL and limestone in drive.
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DISPUTES
Disputes cost time and money. Avoid disputes by methods outlined in this essay. Otherwise, we need quick resolution.
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Use of Engineer to the Contract decision – must be fair and seen to be fair. Conciliation and adjudication
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