CANTOS DEL TROVADOR

The preliminary scope should include enough information for the engineer and constructors to start developing cost and schedule data. The information should include process flow diagrams, preliminary P&IDs (Fig. 4), initial facility require-ments, and the first cut at a validation strategy.

A. Contracting Strategy

Once the API manufacturer has generated enough initial information for the new process, they will have several options for implementation of the design and construction of the new facility. There are various execution strategies, which include:

design and construction utilizing an engineering firm and a construction contractor(s);

 design and construction utilizing an engineering firm(s) and a construction management firm(s);

 utilizing one firm to provide engineering, construc-tion, and procurement services.

The use of the one firm concept of engineering, procure-ment, and construction is well suited for a manufacturing firm that does not have depth within its own engineering and procurement organizations. This method places all the responsibility on the engineering contractor to deliver a fin-ished GMP compliant facility. The firm selected must have the personnel depth to be able to supply all facets of the pro-ject. This method tends to be the most effective for schedule, but can carry cost premiums. The engineering, procurement, and construction (EPC) contractor assumes all the risks on the project and will charge a premium for assuming the risk.

Figure 4 Example of a P & ID for process utilities system (clean steam generation).

The other methods work better with manufacturing firms that have established plant and construction engineer-ing groups. The first method, design and contract, is the

‘‘traditional’’ method of construction. The design is completed and the project bid. The successful bidder has a lump sum contract to complete the work. This method tends to take longer. However, in a competitive market it can be the most cost effective. Utilizing a construction manager and separate design, firm will enhance the schedule of the project by bid-ding work as it is designed and will control costs if properly executed. The chapter discusses these methods in detail later.

B. Development of the Design Strategy and Detailed Design

The API manufacturer has essentially two choices in setting a design execution strategy. They may elect to develop the detailed design in house with their own expertise or they will obtain the services of an engineering firm=contractor who will provide the services for them. We will discuss the option of utilizing outside services for this function. The vast majority of manufacturing firms do not possess the ‘‘in-house’’ capabil-ities to develop the full breath of design for a new process facility or a major renovation.

There are various methods of employing the outside firm utilizing various contracting strategies. The firms can be hired on a reimbursable basis. This method is the most common in the industry. The firm is remunerated for all design services cost plus a mark-up for overhead and profit. Typically, the manufacturer will negotiate a contract with the design services supplier for a ‘‘not to exceed’’ value for the work. The design firm normally develops this estimate. It is impacted by the stage of process development. The more defined the pro-cess and the scope of work, the better the estimate.

The other less common method is buying the design on a lump sum basis. The design firm provides a firm price for the work. A careful definition of expectations is required for this approach. This contracting strategy is akin to using a build-ing contractor for a home or commercial buildbuild-ing. The pricbuild-ing

is based on a fixed set of parameters, which are normally the plans and specifications developed for project. Any items not included in the plans and specifications are considered out of scope. All items out of the scope of the contract are subject to extra charges. The lump sum design contracting strategy is a difficult strategy for designing a new process with uncer-tainty. As design progresses, any changes to the process will result in negotiating change orders to the contract with the design firm. This method can create distractions to the design effort as the manufacturer and the engineer become involved in pricing negotiations. This method is more common with small process configuration changes in existing facilities.

Selecting the right firm and establishing clear expectations is critical to the success of the project. How the firm is utilized is a decision to be made in the planning stages of the project. The API manufacturer can elect to use the various methods of con-tracting for services that have been outlined in the chapter.

C. Setting Expectations

The execution of the design and construction process for an API facility can be defined in four critical steps:

1. design

2. procurement and construction 3. equipment validation

4. start-up, commissioning, and turnover

We have briefly discussed different contracting options.

The API manufacturer has to decide how to procure the outside services necessary to accomplish these steps. We can-not recommend any one method as better than acan-nother. The contracting decisions must be made based on all party’s rela-tive strengths in the execution of this type of project. If the decision is to contract out the entire process to one firm in an EPC contract, the outside firm is expected to deliver a com-pleted facility, validated and ready to produce product.

The API manufacturer, with some level of in-house expertise, can elect to manage the design and construction separately. The outside design firm will be responsible for

providing the proper level of documentation for a construction firm to execute the work. The API manufacturer exercises a greater level of control in this process. The API manufacturer will be involved in many of the decisions made in procurement of equipment and other components and be better able to influence the operability of the facility.