The delivery of very large projects of over $1 billion capital expenditure (mega-projects) safely whilst meeting
the desired sustainability, quality, cost and schedule outcomes for all parties represents a significant challenge
for the engineering and construction industry.

Developing strong relationships with all delivery partners – the customer, contractors, consultants – and
aligning around desired outcomes is critical in delivering successfully.

Importantly the commercial model selected should incentivise the right behaviour and results by all parties to
deliver against competing priorities – quality, cost, risk and schedule. This presentation will outline the most
commonly used commercial models and the circumstances where they would be most applicable. This would
include:
 Engineering, Procurement & Construction (EPC)
 Engineering, Procurement & Construction Management (EPCM)
 Project Management Contractor (PMC) with Design & Construct (D&C) Package

Factors considered include the competency of the contracting market and capacity that exists, customer
project management capability and capacity, the delivery schedule impact on the business case (i.e. schedule
to meet market need) as well as scope size and complexity aspects (i.e. first of kind technology or delivery
techniques). The risk appetite of the customer and contractors plays a significant role in the definition of the
appropriate model.