04 January 2010

National Engineering Contract suits big projects

The New Engineering Contract 3 (NEC3) was selected as the most appropriate method of managing teams of contractors and a host of uncertainties in eThekwini Water and Sanitation’s Asbestos Cement (AC) Pipe Replacement Project.

With a current value of more than R1.6 billion, the project is one of the biggest of its kind ever undertaken by a municipality in South Africa. Begun in 2007, it is currently under way across the whole municipal area of eThekwini and is due for completion in June 2010.

“Initially, 1 750 kilometers of old AC pipe were identified for replacement,” says eThekwini project executive, Alan Kee. “However, in certain areas, especially smaller local authorities that were taken over by eThekwini, the length of pipe needing replacement was unknown.

“It was this high degree of uncertainty, when quantifying the scope of works, which led procurement specialists in the municipality to select the NEC 3 as the most suitable means of managing the project,” says Kee.

The NEC 3 family of contracts is designed to allow for a variety of unknown factors in a big project. Option C, selected for this project, is a target contract with activity schedules that can be adapted to suit the needs of a given area in a flexible and effective manner.

This AC Pipe Replacement Project is being handled by contracting teams involving a design consultant, a big contractor and smaller developing subcontractors. These teams work together within designated areas, with the contract providing the flexibility to match the skills of the team to the needs of the project in different locations.

One of the successes of the project is the mentorship programme that has encouraged the development of 16 small emerging subcontractors, working under four mainline contractors.

“The mainline contractors have embraced the mentoring programme and recognise that the subcontractors are a valuable resource on this huge project,” says Jochen Dedekind, lead programme manager for project managers, Aurecon.

According to Dedekind the mentor’s role is advisory and facilitative. “The objective is to assist subcontractors to advance at least two notches up the Construction Industry Development Board’s ratings,” he says.

The NEC 3 contract requires the teams of design consultants, contractors and their subcontractors to act in a spirit of mutual trust and cooperation. Dedekind says that the project has largely achieved this objective.

The NEC 3 contract is a useful means of managing big projects and would be helpful to municipalities throughout South Africa that are facing the need for major infrastructure upgrades.