A Systems Approach to Managing the Complexities of Process Industries by Fabienne Salimi Frederic Salimi & Frederic Salimi

Author:Fabienne Salimi,Frederic Salimi & Frederic Salimi
Language: eng
Format: epub
ISBN: 9780128042182
Publisher: Elsevier Ltd.
Published: 2018-02-28T16:00:00+00:00

4.1 Megaproject Definition

The “megaprojects” are the large-scale engineering projects with the five following attributes:

1. “High” capital cost—at least 1 billion USD,

2. “Long” duration but program urgency—average development duration 6.5 years with a construction period of 4 years,

3. Technologically and logistically demanding,

4. Requiring multidisciplinary inputs from many organizations, and

5. Leading to a “virtual enterprise” for the execution of the project.

One characteristic of megaprojects is the lack of scope and cost certainty. This has led to the development of a number of procurement approaches that allocate the risk of this uncertainty in different ways, e.g., engineer procure construct (EPC), design and build (D&B), private finance initiative (PFI), public private partnership (PPP), and alliancing and build own operate (BOO). Fig. 4.2 illustrates that the contract serves as an interface between enterprises.

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