The Dulhasti Power Plant David Carey
Grizli777 | The Dulhasti Power Plant | A Case Study | | David J. Carey | PM 3110 |
[Type the abstract of the document here. The abstract is typically a short summary of the contents of the document. Type the abstract of the document here. The abstract is typically a short summary of the contents of the document.] |
Cost estimation is very difficult to determine when dealing with harsh geographical conditions. In regards to the Dulhasti Power Plant, such harsh conditions existed and were not properly identified in the scope baseline. It appears most thought and planning was given to direct project costs and not so much to indirect project costs. One of the most common constraints is having a limited project budget. …show more content…
Weather conditions and the lack of paved roads, and railroads in and out of that undeveloped area forced the French consortium to helicopter everything in.
Which in turn escalated the where, and the when, to spend the money and to have a capable labor force in place to earn the money kept rising out of control. The type of contract to be used and the specific contract terms and conditions, fix the degree of risk being assumed by the buyer and seller. In the Dulhasti contract they agreed on a fixed price contract. The firm-fixed contract is typically preferred and encouraged by most organizations. There are times when other types of contracts best serve the project. As in this case, the fixed price with economic price adjustment type would have served both buyer and seller the best due to the 24 year duration of the project. Low initial estimates, unexpected technical and geographical difficulties, lack of definition, specification changes and external factors all played a huge role in how unfavorable the fixed contract was to both the buyer and
[Type the abstract of the document here. The abstract is typically a short summary of the contents of the document. Type the abstract of the document here. The abstract is typically a short summary of the contents of the document.] |
Cost estimation is very difficult to determine when dealing with harsh geographical conditions. In regards to the Dulhasti Power Plant, such harsh conditions existed and were not properly identified in the scope baseline. It appears most thought and planning was given to direct project costs and not so much to indirect project costs. One of the most common constraints is having a limited project budget. …show more content…
Weather conditions and the lack of paved roads, and railroads in and out of that undeveloped area forced the French consortium to helicopter everything in.
Which in turn escalated the where, and the when, to spend the money and to have a capable labor force in place to earn the money kept rising out of control. The type of contract to be used and the specific contract terms and conditions, fix the degree of risk being assumed by the buyer and seller. In the Dulhasti contract they agreed on a fixed price contract. The firm-fixed contract is typically preferred and encouraged by most organizations. There are times when other types of contracts best serve the project. As in this case, the fixed price with economic price adjustment type would have served both buyer and seller the best due to the 24 year duration of the project. Low initial estimates, unexpected technical and geographical difficulties, lack of definition, specification changes and external factors all played a huge role in how unfavorable the fixed contract was to both the buyer and