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Selecting a BOP Contractor

Evelyn C. Carpenter, PE, Co-founder and President. Selecting a BOP Contractor. Fort Collins, Colorado, USA. Calgary, Alberta, Canada. Renewable Energy – Project and Business Development – Climate Change.

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Selecting a BOP Contractor

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  1. Evelyn C. Carpenter, PE, Co-founder and President Selecting a BOP Contractor Fort Collins, Colorado, USA Calgary, Alberta, Canada Renewable Energy – Project and Business Development – Climate Change SOLAS Energy Consulting provides consulting services for renewable energy solutions and climate change.  Our expertise spans project development, business development, sustainable development and climate change policy analysis. 

  2. SOLAS ENERGY CONSULTING TEAM • Paula McGarrigle, PE, MBA, Managing Director • Years of Experience: 22 years • Technical Fields of Expertise: Renewable Energy • Small- and Large-scale wind prospecting, planning and development • Equipment procurement • Project management from planning through construction, operations, and maintenance • Business Development and Market Assessments • Acquisitions, divestitures, joint venture, financial and technical due diligence • Climate Change Advisory • Advisory services in the areas of policy development, compliance requirements, and alternatives • Alternative markets for green products • Evelyn Carpenter, PE, MBA, President • Years of Experience: 21 years • Technical Fields of Competence: Renewable Energy • Project risk assessment • Commercial agreement negotiation • Technology procurement, planning, budgeting and project due diligence • Negotiation and administration of power purchase and equity/acquisition agreements • Warranty and maintenance agreements • Transportation contracts • Engineering and construction agreements

  3. Project Experience Where to find some of our projects: EPC RFP Management Solar – 300 MW Wind – 1,415 MW NB NB

  4. Name? Company? You gave up time with family, friends, or your favorite pet to listen to this topic, so what is the single most important thing you want to get out of this? Next, tell me about you!

  5. OK, so now we have a real project…. Where do we start???

  6. Engineering, Procurement, Construction (EPC or BOP) SIMPLEST, LOWEST RISK DEVELOPER CONTRACTING STRUCTURE TWO EXECUTION CONTRACTS Turbine Supply Agreement (TSA) • Turbine Vendor and Owner • Turbine Manufacture (sub-component assembly) • Turbine delivery • Warranties • Fit for purpose, parts, and labor • May include in-and-out • Typically 95% power curve • 95-97% availability • Manufacture performs maintenance and service during warranty • Separate O&M Agreement and/or Warranty Agreement Owner and BOP Contractor BOP Warranty 1-2 years All equipment (not turbines) Facility design, turbine receiving and erection All BOP construction including substation and t-line Turn Key (LSTK) Fixed price, T&M, Guaranteed Maximum Price

  7. Nah, too easy. Let’s see how much money we can save and contract it some other way… “I want frickin' sharks with frickin' laser beams attached to their frickin' heads” – Dr. Evil

  8. The Overly Complicated,Difficult-to-do, Theoretically Cheaper (but only if you are perfect), Contracting Structure Let’s be our own General Contractor! TSA Padmount transformer supply Substation Transformer Supply Full engineering, Civil, Collection, Erection, (Foundations/Geotech) Substation install Procure main sub equipment T-Line materials T-Line Install WTG Transportation Agreement O&M Building Design/Install …and manage the site!!! Photo: Milford Wind Corridor, 203.5MW

  9. Too Complex???? Too complex!!!***++ ***For the average developer ++ Plus, hard to finance

  10. Lifting Lugs BOP/TSA Interface Points Questions to ask that can cost you big bucks If project can’t receive WTGS, where do they go and who pays? How is demurrage handled? What does the manufacturer provide? (slings, rigging, lugs, extra bolts?) How are shortages handled? How is pre-commissioning handled and whose scope? Project energization plan? Project turnover plan including training?

  11. Nacelle Rigging BOP/TSA INTERFACE POINTS Important Commercial Terms • Risk of Loss • When do you take risk of loss? • How do you cover it? • Insurance • Construction All Risk/Builder’s All Risk • Rigger’s Liability? • Contractor GL • Marine DSU • Storage Endorsements • Operational Insurance • Business Interruption

  12. The three pillars of project execution

  13. So…how do we pick A Contractor?it’s almost like dating… Reed & Reed, Inc. TVIG, Inc.

  14. Both Parties have needs… • Step 1 – Identify where you are, what you need and what you have to give • Why should they spend $30-50k to give you pricing? • Step 2 – Identify who can give it to you • Contractor qualifications process • Written questionnaire • Research/validation • Contractors discussions • Gain interest in project • Show feasibility • Step 3 – Conduct the RFP • Finalize the Bid List – large enough but small enough • Write the package – rationally and completely • Manage it – fairly and consistently • Evaluate it – without prejudice and methodically

  15. Breakout Groups 5-10 Minutes Team A You are the Contractor. How are you evaluating this Developer? Team B You are the Developer. What are your criteria and qualifications required for developing a bid list?

  16. Contractor’s Perspective • GO • Major agreements – PPA, TSA, LGIA? • Land all secured? • Permits secured? • How are they paying for it and guaranteeing their performance? • GET • How many bidders? • What is relationship with client? • What is our positioning in the market? • DESIRE • Is this a strategic play? (Future business?) • Do we need this job/do we want this job? • Is the developer rational in contract terms? • How busy are we and does it fit into the resource allocation?

  17. Developer’s Perspective • Labor profile (union/non-union/local/MBE requirements?) • Technical Experience • Specific turbine? • Utility experience? • Design capabilities – Electrical, SCADA? • Relevant Geographic experience • State/local workforce • Permitting jurisdictions • Execution Capabilities • Demonstrated experience at this project size? • Safety record, QA/QC, reporting, scheduling • Self perform/Partnering/Subcontractor strategy • Proposed execution team • Commercial Capabilities • How will they secure their obligations? • Will they take the appropriate contract risk? • Claims, insurance, warranties

  18. Thank you for your attention! Any Questions?

  19. CONTACT US Paula McGarrigle, Managing Director SOLAS Energy Consulting Inc. Suite #119 2137 - 33 Avenue, Southwest Calgary, Alberta T2T 1Z7 CANADA Telephone: 403 454-9463 E: pmcgarrigle@solasenergyconsulting.com With experience in renewable energy and climate change since the late l990s, you can be assured SOLAS has the depth and perspective to help your business navigate the many issues associated with Climate Change policy and project development. Evelyn Carpenter, President SOLAS Energy Consulting US Inc. #360 1001A East Harmony RoadFort Collins, Colorado 80525-3354 Telephone: 501 438-9463 E: ecarpenter@solasenergyconsulting.com

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