Contracting Formulas for Large Engineering Projects. The Case of Desalination Plants

Abstract

Population growth has increased over the past two centuries. In the driest countries, water supply alternatives are scarce, with desalination being an alternative to ensure water supply to the population. Desalination plants have increased in size and efficiency, and require large investments, large infrastructures, and complex technology, besides they also need sophisticated contractual formulas to successfully build them. Various contract models are tools that should be used by taking into consideration the characteristics of the project, the parties involved, and who is responsible for each of the risks involved. To help choose the most suitable type of contract for a particular project, so-called decision support systems have been developed over the past thirty years. In this paper, a new decision support system is presented and applied to a case study of two desalination plants built under the design and build and turnkey modes of contract. The objective was to determine the most suitable contract model for these types of projects which had very ambitious objectives and decisive social, economic, and environmental implications.

Requirements for the Construction of New Desalination Plants into a Framework of Sustainability

“…From among the numerous decision support systems, authors have proposed the method of determining factors [63], published in 2020: (1) client, (2) contractor, (3) contract, (4) budget, (5) financing, (6) risks, and (7) technological developments. It offers a procedure which adapts to any kind of project, specially indicated for large-scale infrastructure projects.…”

An Approach to the Analysis of Causes of Delays in Industrial Construction Projects through Planning and Statistical Computing

“…They are part of various construction markets, but different from civil construction, infrastructure, or residential buildings, being their purpose to deliver a functioning facility or asset to End-Users. This type of projects encompasses a wide variety of fields of application and sectors, including but not limited to power generation, nuclear plants, industrial plants, renewables, power transmission and distribution, water treatment, Oil and Gas fields development and processing plants or treatment units [2][3][4][5][6].…”

“…While in absolute terms it seems straightforward to identify activities that are completed after their originally scheduled completion date, it is also important to discern whether it is the implementation of the activity itself that was delayed or whether, on the contrary, the delay could have been due to issues not attributable to the activity itself. Despite the heterogeneity of the scope of industrial construction projects [3,[48][49][50] and the relationships between scheduled activities, there is no denying the importance of determining not only the start of an activity but also the loss of float or reduction of the planned duration, which can even influence the modification of the tasks associated with each activity to mitigate or avoid delays.…”