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Introduction (Epcm)

EPCM stands for Engineering, Procurement, and Construction Management. There is sometimes confusion between EPCM and EPC. EPC means the company takes responsibility for engineering, procurement, and construction, taking on more risk. EPCM means the company provides engineering, procurement, and construction management services, but the owner takes on more responsibility and risk. There are advantages to both approaches depending on the project details. Books on the topic provide overviews but few details on contract variations, while project descriptions online provide more specific examples of EPCM in mining projects.

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Shahid Barola
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494 views

Introduction (Epcm)

EPCM stands for Engineering, Procurement, and Construction Management. There is sometimes confusion between EPCM and EPC. EPC means the company takes responsibility for engineering, procurement, and construction, taking on more risk. EPCM means the company provides engineering, procurement, and construction management services, but the owner takes on more responsibility and risk. There are advantages to both approaches depending on the project details. Books on the topic provide overviews but few details on contract variations, while project descriptions online provide more specific examples of EPCM in mining projects.

Uploaded by

Shahid Barola
Copyright
© Attribution Non-Commercial (BY-NC)
Available Formats
Download as DOC, PDF, TXT or read online on Scribd
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INTRODUCTION

EPCM stands for Engineering, Procurement, and Construction Management as far as this article is concerned. There are other meanings that might bedevil you if you do a Google search. For example consider Essential Procedures for Clinical Microbiology or European Project & Change Management. The one I liked best was European Photonics Clusters Meeting. As the EPCM Consultants Home Site says "we provide a range of project services, from feasibility studies to commissioning and operations support."

EPC VERSUS EPCM


To make matters more confusing, there is sometimes another acronym, namely EPC. Is EPC different from EPCM? One view is no, as epitomized by this comment from Eng-Tips Forums: "There is no absolute definition. Most large consulting companies call themselves EPC and/or EPCM. Think Bechtel, Fluor, Jacobs, Kellogg, etc. They all act as the main contractor, sub-contractor - often at the same time, on different projects in-house, and to/with each other. It's one of those industry jargon acronyms that people throw around, and most don't really know its exact definition/meaning, and now, it doesn't have an exact definition/meaning." This is not quite true. For there is a difference between EPC and EPCM, as noted by another commenter to Eng-Tips Forums: EPC means the company is contracted to provide engineering, procurement and construction services. Think Design & Construct style contracts, where the project is largely Contractor managed and the cost risk and control are weighted towards the Contractor and away from the Owner. EPCM means the company is contracted to provide engineering, procurement and construction management services. Other companies are contracted by the Owner to provide construction services and they are usually managed by the EPCM contractor on the Owner's behalf. Think professional services contracts, where the project is largely Owner managed and the cost risk and control is weighted towards the Owner

An excellent comparison of EPC versus EPCM and the many aspects of each is at the Prodigy Engineering Group site. It all boils down to who takes the responsibility to make things happen. And who takes the risks and/or reaps the rewards. Here are some advantages of each from Prodigy: EPCM Advantages:


supply

Lower Overall Cost Staff's Sense of Ownership More Control over Process Better for less defined projects with anticipated changes to scope of Less Legal Litigation (Identify issues early and remedy situation before

larger problems arise) Owner's Financing Flexibility EPC Advantages:

One Stop Shopping "One point of Contact" "Hands off" approach to project Minimal Staffing Requirements Minimal Legal Risk Best for Well defined projects with Detailed Engineering Complete

before EPC Contractor selected (Minimal Unknowns).

BOOKS
In mining, the definitive book is EPCM(C): Managing Capital Projects for Mining by Dan Mackie. The (C) stands for Commissioning. As the blurb notes, these are some of the people involved in a mining project who may want to know more about EPCM: engineers, estimators, purchasing agents, senior managers, company presidents, and anyone who is responsible for some portion of a project and wants to know how it all fits together. The book is an easy read focusing primarily on first principles. If you know a little about project management, you probably won't learn much new from this book. Certainly it hardly touches on the many variations of EPC versus EPCM versus the many subsets of contract, responsibility, risk, and liability possible between a mine, a mining company, people who design, procure, construct and manage. Process plant engineers may be interested in the Handbook for Process Plant Project Engineers by Peter Watermeyer. The electronic version is available on-line. It is worth looking at the discussion of the mechanics and legalities of EPCM contracts in the book. Surprisingly there is little else. Some books on project management may help, but there are none I care to recommend. OneMine has 14 technical papers for the keyword "epcm". Most are project descriptions of mines where EPCM has been used. Useful if you can access the site.

CONSULTANTS & CONTRACTORS


An easy way to read project descriptions of EPCM in mining is to do a Google search using the full words "engineering procurement construction management mining." It is also a good way to confirm which consultants and contractors offer such services to the mining industry. Here are some of the more interesting:

AMEC has several results on their site for EPCM. Information ranges from presentations to awards, to oil and gas contracts. Ausenco Minerals (part of the Ausenco group of companies) specializes in EPC and EPCM, commissioning and operations services, with projects in the Americas, Australasia, Africa and Asia. Fluor provided EPCM services to mines from oil sands Alberta to heap leach pads in Chile. They also have released this publication which elaborates further on their EPC services. Jacobs Engineering is working for Syncrude and Suncor on many a project. And for others worldwide. SNC Lavalin has the heft but no EPCM mining project descriptions I can find. TWP are an African based EPWM & EPC company that sevices the mining & minerals industries as well as a range of civil engineering projects.

SOME PERSONAL REFLECTIONS


I once worked for Jacobs on a very large project, the UMTRA Project. We closed 24 uranium mill tailings sites in ten states. Our client was the U.S. Department of Energy (DOE). The contract situation was complex, an extension of the EPCM concept. The DOE had a relatively small group of folk to manage two contractors. The first, Jacobs was responsible for what you may call the intellectual work. MK Fergusson was responsible for construction. Thus in Jacobs we characterized the sites, did the conceptual engineering, finalized the environmental impact statements, and looked after overall project health and safety, quality, and schedule management and control. MK Fergusson did the final engineering design (which we reviewed), retained individual contractors for each site's construction, and managed all construction work on site. This arrangement worked well, although I suspect it was expensive. Point is that as a mining company you are unlikely to want to retain one consultant to be your intellectual advisor and guide, and another consultant to do the final design and construction management. But then again you may. If like Northern Dynasty you find yourself with an ore body that involves a mine bigger than you can bring to fruition yourself, this may be better than brining in another big mining company to relieve you of the planning, etc hassles.

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