The following Construction guidance note Produced in partnership with Clarke Willmott LLP provides comprehensive and up to date legal information covering:
There are three main procurement routes used in UK energy projects:
engineering, procurement and construction (EPC) contract procurement
split EPC contract procurement
multi-party contract procurement
This Practice Note provides a review of each of these methods, and discusses some of the benefits and disadvantages of each route and practical issues to consider. It is intended as a basic guide; professional legal advice should be sought before choosing a procurement option for your specific project.
The EPC contract is the most common method of procurement for UK energy, large-scale and complex infrastructure projects. Under an EPC contract the contractor is responsible for the delivery of the total project including the design, engineering, procurement of the materials, construction and testing of the mechanical elements. For more information on EPC contracts see Practice Notes: Introduction to EPC contracts, EPC contracts—handover, testing and commissioning and EPC contracts—limits of liability.
The diagram below illustrates the key contractual structure of a project procured using the EPC route with project finance backing. This structure may change from project to project although the diagram details the contractual matrix:
Click here to view or print the full-size PDF version.
Effectively, an EPC contract usually specifies that the project be delivered on a turnkey basis. This means it should be delivered for a fixed price, within a fixed time
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