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Understanding and Negotiating EPC Contracts, Volume 1: The Project Sponsor's Perspective [Kõva köide]

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  • Formaat: Hardback, 244 pages, kõrgus x laius: 246x174 mm, kaal: 640 g
  • Ilmumisaeg: 26-Oct-2016
  • Kirjastus: Routledge
  • ISBN-10: 1472411064
  • ISBN-13: 9781472411068
Teised raamatud teemal:
Understanding and Negotiating EPC Contracts, Volume 1: The Project Sponsor's PerspectiveSuurem pilt
  • Formaat: Hardback, 244 pages, kõrgus x laius: 246x174 mm, kaal: 640 g
  • Ilmumisaeg: 26-Oct-2016
  • Kirjastus: Routledge
  • ISBN-10: 1472411064
  • ISBN-13: 9781472411068
Teised raamatud teemal:
Püsilink: https://www.kriso.ee/db/9781472411068.html
Märksõnad:
In Understanding and Negotiating EPC Contracts, Volume 1, Howard M. Steinberg presents a practical and comprehensive guide to understanding virtually every aspect of engineering, procurement and construction (EPC) contracts for infrastructure projects.

The 25 chapters in Volume 1 are supplemented with real-life examples and court decisions, and offer tactical advice for anyone who must negotiate or understand EPC contracts in connection with the implementation, financing or operation of infrastructure projects.

Emphasizing current market practices and strategic options for risk sharing, the book contains a narrative explanation of the underpinning of all of the issues involved in EPC contracting. Exhaustive in scope, it clarifies the fundamental commercial principles and pitfalls of "turnkey" contracting for all types of capital investments ranging from electrical and thermal power generation (including combined heat and power, nuclear, wind, solar, natural gas and coal) to refining, to chemical processing to LNG liquefaction and re-gasification to high speed rail, bridging, tunneling and road building. Providing clear and thorough analyses of the issues and challenges, this volume will be of great value to all those involved in complex construction projects.

Arvustused

Every lawyer involved in project finance should read this book! Oscar Frota, Senior Legal Counsel, GDF Suez Energy Latin America

From the finance side, before we can even look at the economics of a project, we need to know that its contractual structure is sound. This book is a must for any serious banker. Edmundo Lujan, Executive Director, Project Finance Latin America, Banco Bilbao Vizcaya Argentina S.A. (BBVA)

There would be a lot less restructuring work if a proper risk allocation had been put in place since inception. This book provides a must-read guide to project parties to achieve that goal. Jean-Valery Patin, Managing Director and Head of Project Finance Latin America, BNP Paribas

Its truly astounding how much money companies will spend only to learn they do not have a project that can be financed. This book should be the first investment for any project. Halil Sunar, Director of Power for Turkey, State Oil Company of Azerbaijan (SOCAR)

Financing projects is all about understanding the risks. Anyone who hasn't read this book is just giving himself an unnecessary handicap. Natasha Kirby, Associate Director, Strategic Energy Solutions Group, HSBC

Volume I
List of Figures
xv
Reader's Note xvi
Foreword xvii
About the Author xviii
Introduction 1(2)
1 A Historical Perspective
3(5)
Varying Construction Approaches in the U.S. Power Industry
3(1)
The EPC Approach Emerges
4(2)
The Collapse of the U.S. Power Industry
6(2)
2 Choosing a Development Approach
8(10)
Concessions
8(1)
Build and Transfer (BT)
9(1)
Build, Transfer and Operate (BTO)
9(1)
Build, Own, Operate and Transfer (BOOT)
9(1)
Build, Own and Operate (BOO)
9(1)
Public-Private Partnerships (PPP)
9(1)
Privatizations
9(1)
Legal Regimes---Civil Codes vs. Case Law Approaches
10(1)
Choosing a Legal Entity
10(1)
General Partnerships
11(1)
Limited Partnerships
11(1)
LLPs and PCs
12(1)
Corporations
12(1)
Limited Liability Companies
12(1)
Forming the Project Entity
13(1)
SPVs
14(1)
Development Partners
14(2)
An Integrated Structure
16(2)
3 The EPC Contractor's Approach
18(4)
Consortia
19(1)
The EPC "Wrap"
19(1)
On-shore/Off-shore Issues and Coordination Agreements
20(1)
EPCM
21(1)
4 Beginning the Evaluation Process
22(16)
The Financial Model
22(1)
Financing
22(1)
Coverage Ratios
23(3)
Lenders' "Step-In" Rights
26(1)
Financing Agreements
27(1)
Bank Financing
27(1)
Construction and Term Loans
28(1)
Public Market
28(1)
Functional Analysis
29(1)
Approaching EPC Contractors
30(1)
Formal Bid Solicitations
31(2)
Sole Source, "Open Book" Negotiations
33(1)
Focusing the EPC Contractor's Attention
34(1)
Communicating with the EPC Contractor and the Attorney/Client Privilege
35(3)
5 Full-Scale Development
38(10)
The Development Timeline
38(1)
The Environmental Impact Study
38(2)
The Contractual Negotiation and Permitting Phase
40(3)
Notice to Proceed
43(1)
Limited Notice to Proceed
44(4)
6 Philosophy of the EPC Contract
48(8)
Intent
48(1)
Quasi-Contract
48(1)
Parole (Oral) Evidence
49(1)
Additional Terms
49(3)
Prudent Practices
52(1)
"Best" Efforts and "Commercially Reasonable" Efforts
52(1)
"Good Faith" and "Good Intentions"
53(3)
7 Subcontractors
56(5)
Terms Contained in Subcontracts
59(1)
Third-Party Beneficiaries
59(2)
8 Site or Route Survey
61(4)
Hazardous Materials
63(1)
Legal Control over the Site
64(1)
9 The Work
65(8)
The Functional Specification
65(1)
Contractual Provisions
66(1)
The EPC Contractors Obligations during the Design Phase
67(1)
Professional Engineering
67(1)
Quality Control
68(1)
The EPC Contractors Obligations during the Construction Phase
68(1)
Health and Safety
68(1)
Supervision
68(1)
Project and Construction Managers
68(1)
Union Labor
69(1)
Security and Surveillance
69(1)
Minimization of Disruptions in Surrounding Areas
70(1)
Coordination with Other Contractors
70(1)
Site or Route
70(1)
Shipping and Delivery Schedules
70(1)
Sourcing of Equipment
71(1)
The EPC Contractor's Training Obligations during Commissioning
71(1)
Establishing the Framework
71(2)
10 The Sponsor's Obligations under the EPC Contract
73(5)
Assumption of Responsibility
74(1)
Owner Furnished Equipment
75(1)
Refurbished Equipment
75(1)
Technology Licenses
76(2)
11 Monitoring the Progress of the Work
78(7)
Developing the Baseline Project Schedule
78(1)
Schedule Updates and Progress Reports
79(1)
Rights of Inspection
80(1)
Engineering and Design Phase
80(1)
Manufacturing and Fabrication Phase
81(1)
Witness Points vs. Hold Points
82(1)
Field Construction
82(1)
Project Accounting and Audit
83(1)
The "Owner's Engineer"
84(1)
The "Independent Engineer" or "Lender's Engineer"
84(1)
12 Unforeseen Circumstances, Adjustments and Change Orders
85(17)
Force Majeure
85(5)
Risk of Loss
90(1)
Builder's All Risk Insurance to Cover Risk of Loss
90(2)
Equitable Adjustments
92(1)
Equitable Price Adjustments
93(1)
Equitable Time Adjustments
94(1)
Float
95(1)
Change Orders
96(2)
Directed Changes
98(1)
Constructive Changes
99(1)
Cardinal Changes and Contractual Abandonment
100(1)
Cumulative Impact Changes
100(2)
13 The EPC Contractor's Failure to Perform
102(17)
The Concept of Default
102(1)
Remedies at Law vs. Remedies in Equity
102(1)
Adequate Assurance
103(1)
The Owner's Remedies
103(1)
Exclusivity of Remedies
104(1)
Engineering Difficulties
105(2)
Construction Difficulties
107(2)
Financial Difficulties
109(1)
U.S. Bankruptcy Example
110(2)
Procedural and Substantive Consolidation of Cases
112(1)
Rejection of Contracts
112(2)
The Slide Toward Insolvency
114(1)
Subcontractor Difficulties
115(1)
The Owner's Options
116(3)
14 The Owner's Failure to Discharge Its Responsibilities
119(5)
"No Damages for Delay" Provisions
121(1)
Active Interference and Loss of Efficiency
122(2)
15 Unexpected Market Conditions
124(3)
The Owner's Right to Suspend or Terminate Work
124(3)
16 Testing and Completion of the Work
127(19)
Mechanical Completion
127(1)
Startup and Commissioning
127(1)
The Punch List
128(1)
Output During Commissioning
129(1)
Performance Testing
130(1)
Unit Testing
130(1)
Power Plant Degradation
131(1)
Performance Curves
132(1)
Test Measurement Locations
132(1)
Extrapolation
132(1)
Offtaker or Facility User Requirements
133(1)
Correction Curves
133(1)
Deemed Acceptance
133(2)
Reliability Testing
135(1)
Ambient Air Temperature
135(1)
Performance Tests for Offtakers and Lenders
136(1)
"Inside-the-Fence" Offtakers
137(1)
Merchant Power Facilities
138(2)
Substantial Completion or Provisional Acceptance
140(2)
Final Acceptance
142(1)
Early Operation
142(2)
Operating Revenues during the "Early" Operation Period
144(2)
17 Liquidated Damages for Delay and Impaired Performance
146(12)
Liquidated Damages for the EPC Contractor's Failure to Achieve Substantial Completion or Provisional Acceptance on Time
147(3)
Early Completion Bonuses
150(1)
Liquidated Damages for Impaired Performance
150(1)
Output
151(2)
Efficiency
153(1)
Availability
153(1)
Emissions
154(1)
"Double Counting"
154(2)
"Caps" on Liquidated Damages for Delay and Poor Performance
156(1)
"Subcaps"
156(2)
18 The EPC Contractor's Warranties of the Work
158(9)
Hidden or Latent Defects
160(1)
Subcontractor Warranties
160(1)
Superior Vendor Warranties
161(1)
"Pre-Ordered" Equipment
161(1)
"Serial" Defects
161(1)
Locating Defects and Deficiencies
162(1)
Remedies for Breach of General Warranty
162(1)
Scheduling of Warranty Work
163(1)
Warranty Exclusions
164(1)
Limitation of Warranties
165(1)
Warranty Bonds
166(1)
19 Security for the EPC Contractor's Performance
167(8)
Performance Bonds
167(1)
Parent Guarantors
168(1)
Other Security
169(1)
Collection vs. Payment
169(1)
Forum
169(1)
Letters of Credit
169(1)
"Direct Pay"
169(2)
Eligible Banks
171(1)
Standby Letters of Credit
171(2)
Expiration
173(1)
Bank Guaranties
173(2)
20 Limitations on Overall Liability and Contract Expiration
175(4)
Negligence and Gross Negligence
175(1)
Types of Damages
176(1)
Waiver of Damages
176(1)
Who Owes the Damages and to Whom Are They Owed"?
177(1)
No Excuse of Performance
177(1)
Contract Expiration
177(2)
21 Payment for the Work
179(20)
Exclusions and Inclusions
180(1)
Taxes
180(1)
Spare Parts
180(1)
"Take Out" Prices
181(1)
Currency Fluctuation
181(1)
Guaranteed Maximum Pricing and Risk Pools
182(1)
Incoterms
182(1)
Rising Prices'?
182(1)
Letters of Intent
183(1)
Milestone Payments
184(1)
Timing
185(2)
The Right to Verify Progress
187(1)
Retainage
187(2)
Release of Retainage
189(1)
Payments Withheld
190(1)
Setoff
191(1)
Disputed Payments
191(1)
Payment Currency
192(1)
Suspension of Milestone Payments
193(1)
Payments for Unresolved Change Orders
193(1)
Special Payment Arrangement for Export Credit Agencies
194(1)
Termination Payments
195(1)
Security for the Owner's Payments of the Contract Price
196(1)
Subrogation
197(2)
22 Title and Other Legal Matters
199(5)
Licenses
201(1)
Representations and Warranties
201(1)
Legal Opinions
202(2)
23 Indemnification and Insurance
204(16)
Insurance
208(1)
Builder's Insurance
209(2)
BAR and Expansion Projects
211(1)
Marine Cargo Insurance
212(1)
Advance Loss of Profits (Delayed Startup)
213(1)
Environmental Clean-Up Insurance
213(1)
Third-Party Liability Insurance
213(1)
Worker's Compensation Insurance
214(1)
Automobile Insurance
214(1)
Aircraft Insurance
214(1)
Errors and Omissions/Professional Liability
214(1)
Umbrella Insurance
214(1)
Political Risk Insurance
214(1)
Title Insurance
215(1)
Operating Period Insurance
216(1)
Pollution Insurance
216(1)
Business Interruption Insurance
216(1)
Deductibles
216(1)
Effectiveness of Policies
217(1)
Cooperation and Claims
218(1)
Subcontractors' Insurance
218(2)
24 Dispute Resolution and Governing Law
220(12)
Mutual Discussions
220(1)
Litigation
221(1)
Motions for Dismissal
221(1)
Choice of Law
222(1)
Judgments
222(1)
When to Litigate
223(1)
Discovery
223(1)
Arbitration
223(1)
Multi-Party Arbitration Agreements
224(1)
"Ad Hoc" vs. "Institutional" Arbitration
224(1)
Recognition of Arbitral Awards
225(2)
ICSID Arbitration
227(1)
Mediation and Conciliation
227(1)
Independent Experts
228(1)
Dispute Resolution Boards
229(1)
Pendency of Disputes
230(1)
Disputes with Governments, Agencies and Regulated Utilities
230(1)
Language
230(1)
Costs
230(2)
25 Interested Third Parties
232(5)
Assignment of the EPC Contract
232(2)
Publicity, Confidentiality and Proprietary Information
234(1)
Indiscreet Conduct
235(2)
Afterword 237(1)
Table of Case Citations 238(3)
Index/Glossary 241
Howard M. Steinberg is of counsel and a retired partner in the law firm Shearman & Sterling LLP and has more than 25 years of legal experience in the infrastructure sector in more than 100 countries. He is named a leading lawyer in project finance by Chambers & Partners and IFLR 1000. He represents sponsors, offtakers, miners, suppliers, engineering firms, consultants, financial advisors, contractors, operators, underwriters, lenders, export credit agencies and multi-lateral institutions in the development, acquisition, restructuring and privatization of projects around the world. He holds bachelors and business degrees from Columbia University and a law degree from New York University.