WHAT WE DO

SERVICES WE OFFER

A key component within many of our transaction advisory and tender structuring and management services mandates includes the drafting, negotiation, amendment and revision of construction, service and supply contracts that we prepare on behalf of our public sector or private sector clients.  DCS experts are comprised of veteran lawyers, bankers, corporate executives and financial advisors who have decades of global experience with construction and service agreements and we are also quite familiar with international norms and practices, as well as the environmental, social and health and human safety requirements from many of the International and Development Financing Institutions (IFI/DFI), Equator Principals and other requirements that often need to be considered, in situations where IFI/DFIs and other international lenders are providing support.  Of course, the construction and service agreements will also need to conform to our client's own applicable laws and regulations.  

DCS advisors have a great deal of experience in drafting and negotiating construction and services contracts on behalf of our public sector, private sector, lender and IFI/DFI clients in many different contractual settings.  We can assist our clients in drafting and negotiating all construction and services contracts, either in the context of a competitive tender or in the case of a negotiated transaction framework.   The multi-faceted DCS advisory team is prepared to lead contract negotiations relating to all legal, technical, commercial/ financial aspects of the transaction.  In a competitive tender situation, where we are providing tender structuring and management services, we will coordinate both the drafting and negotiation of the tender documentations (RFEI/RFQ/RFP packages) as well as the construction and services contacts.  The following are a few of the most common types of construction and services contracts that we typically draft, amend, revise and negotiate on behalf of our clients:

• Design-Build (DB) Contract.  A DB contract is typically utilized for development of certain non-plant infrastructure asset, that does not involve a major component of equipment acquisitions and is mainly related to civil work construction.  Design-build contracts encompass the final design, engineering, mobilization, and construction elements of a greenfield or brownfield project and typically requires certain environmental, social and regulatory licensing, permitting and other entitlements to be attained by the DB contractor.  A DB contract may be structured on a lump-sum fixed-price "turnkey" basis (typically with milestone payments), or on a cost-plus pricing basis or various hybrid variations.  It is also common for the DB contract to also provide an incentive/bonus mechanism related to under- or over-performance of the DB contactor.

• Engineering, Procurement and Construction (EPC) Contract. An EPC contract is typically used for development of production plants and other infrastructure project that include a significant equipment element.  EPC contracts typically encompass the final design, engineering, mobilization, equipment procurement and construction elements of a greenfield or brownfield project and typically requires certain environmental, social and regulatory licensing, permitting and other entitlements to be attained by the DB contractor.  An EPC contract may be structured on a lump-sum fixed-price ("turnkey") basis (typically with milestone payments), or on a cost-plus pricing basis or various hybrid variations. It is also common for the EPC contract to also provide an incentive/bonus mechanism related to under- or over-performance of the EPC contactor.

• Engineering, Procurement and Construction Management (EPCM) Contract.  A management services contract where an EPCM contractor is selected to manage one or more separate EPC contracts or discrete engineering/design, civil construction and equipment supplier subcontractors.  The EPCM contract may be structured on a fixed fee basis, with an incentive/bonus mechanism related to the performance of the subcontractors.
  

• Operations and Maintenance (O&M) Contract.  An O&M contract is typically a multi-year contract that allocates a specific scope of O&M services in connection with operating and maintaining an infrastructure, plant, building or equipment asset.  O&M contracts often have both fixed and variable pricing components.  The pricing can be based on a fixed periodic fee and fixed unit fee basis (usually subject to inflation/indexation).

• Maintenance Contracts and Long-Term Maintenance (LTM) Contracts.  A Maintenance/LTM contract is typically a multi-year contract that allocates a specific scope of routine maintenance, preventative maintenance and/or cyclical/major maintenance services in connection with operating and maintaining an infrastructure, plant, building or equipment asset.  Maintenance/LTM contracts often have both fixed and variable pricing components.  The pricing can be based on a fixed periodic fee and fixed unit fee basis (usually subject to inflation/indexation).

• Design-Build-Operate-Maintain (DBOM) or Design-Build-Maintain (DBM).  A DBOM (or DBM) contract involves a combined DB + O&M (or DB + M) contract for the development of the infrastructure asset.  The DB and O&M (or maintenance/LTM) contractors typically join together as a consortium, joint venture or other arrangement.  The DBOM/DBM pricing structure may contain elements of both DB and O&M (or maintenance/LTM) pricing structures as described above.  Under a competitive bid or negotiated procurement the DBOM/DBM contract includes "life-cycle" pricing and value implications that can be evaluated by the procurer.

• Engineering, Procurement and Construction Management + Operations & Maintenance (EPC+O&M) or Engineering, Procurement and Construction Management + Maintenance/Long-term Maintenance (EPC+M/LTM).  An EPC+O&M (or EPC+M/LTM) contract involves a combined EPC + O&M (or EPC + M/LTM) contract for the development of the infrastructure asset or plant.  The EPC+O&M (or EPC+M/LTM)  contractors typically join together as a consortium, joint venture or other arrangement.  The EPC+O&M (or EPC+M/LTM) pricing structure may contain elements of both EPC and O&M (or maintenance/LTM) pricing structures as described above.  Under a competitive bid or negotiated procurement the EPC+O&M (or EPC+M/LTM) contracts include "life-cycle" pricing and value implications that can be evaluated by the procurer (either through competitive tender evaluation using a bid evaluation model or through negotiations).
  

• Design-Build-Finance (DBF), Design-Build-Finance-Operate-Maintain (DBFOM), Design-Build-Finance-Maintain (DBFM), EPC+Finance (EPC+F), EPC+Finance+O&M (EPC+F+O&M), EPC+Finance+M/LTM (EPC+F+M/LTM).  In some cases, a significant value driver in selecting one contracting consortium over another may be with respect to financing that is arranged by the contracting consortium.  A DBF, DBFOM, DBFM/LTM, EPC+F+O&M and EPC+F+M/LTM are each a contractual variation where the contracting entity is contractually obligated to provide financing to the procurer (or to the ultimate counterparty) for all or a portion of the project costs.  Particularly in cases where the contracting group can bring attractive Export Credit Agency (ECA) / Export-Import Bank (Ex-Im), commercial financing or vendor financing, these contracting structures can be very attractive.  In some cases the borrower may become the procurer (or the ultimate counterparty).  However, in other cases the contracting company will serve as the borrower and the DB/EPC there would be a be a term-out schedule in the agreements which mirror the underlying loan agreements.  Under a competitive bid or negotiated procurement the DBF, DBFOM, DBFM/LTM, EPC+F+O&M and EPC+F+M/LTM contracts include "life-cycle" pricing and value implications that can be evaluated by the procurer (either through competitive tender evaluation using a bid evaluation model or through negotiations).
  

• Environmental Rehabilitation and Remediation Service Contracts and Restoration Services Contracts.   In the case of many types of infrastructure assets, plants, mines, oil & gas rigs and real estate projects and assets, environmental rehabilitation and restoration service may be required at some point during the life of the project or asset.  In some cases, there are environmental issues such as hazardous waste contamination at a project site that need to be addressed prior to construction can begin.  Other times there may be an accident at some point during the operating life of the project that needs to be remediated.  Other times, there may be "back end liabilities" at the project or asset site that need to be remediated and/or restored after a project or assets is decommissioned (for example, plants, mines and oil & gas rig sites).  In many cases, when the scope of an environmental problem can be well-assessed a finitely determined, then a comprehensive Rehabilitation and Remediation Services Agreement or a Restoration Agreement can be structured on a turnkey fixed price basis.  In other cases, where the extent of the environmental cannot be fully assessed until work commences, then it is very difficult to structure these contracts on a fixed price turnkey basis.  Environmental and restoration services contracts can be procured through competitive tender or a a negotiated basis.

• Decommissioning Services Agreements.  Decommissioning normally relates to production plants, pipelines, mines, oil & gas rigs at the end of their service lives.  In most cases decommissioning (and remediation, rehabilitation and restoration) of a project or asset site is a regulatory requirement.  Decommissioning is usually the obligation of the owner/operator of the plants, pipelines, mines, oil & gas rigs.  In some cases (such as with nuclear power plant decommissioning), the owner/operator can enter into fixed price contract to outsource decommissioning liabilities to a specialist contractor at a defined future decommissioning date.  Negotiating forward period decommissioning agreements can reduce the uncertainty over the cost and whether sufficient funding will be available to fund decommissioning costs.
  

​DCS advisors are able to provide construction and service contract drafting and advisory services on a stand-alone basis on behalf of clients who are pursuing a PPP/P3, project financing, and other construction and service contract procurement transactions.  In most cases, as the construction and service contract drafting services will be only one element of a larger project delivery program, DCS will also be providing numerous other complementary transaction advisory services in relation to other transaction elements.  Our preference is always to provide such comprehensive transaction advisory services and coordinate all elements of the transaction, including contract or construction and service contract drafting and advisory services on behalf of our clients.

Under any construction and service contract drafting and advisory services mandate, DCS will draw from our vast global network of veteran industry expert advisor affiliates and our relationship consultants in order to assemble the most appropriate team to match the specific needs of the transaction at hand.  This will always include leadership of DCS affiliate experts who possess decades of global public and private sector experience related to the specific sector and transaction type.  In any construction or service contract drafting and advisory services mandate, our preferred role is always to serve as the lead project/program manager.  Within this role we are also able to assist in the selection and procurement (or subcontracting) and management of the other advisors and consultants, including local and international legal, technical, tax, insurance/risk, commercial advisors or other specialized advisors, as the specific transaction may require.  To the extent that other third-party advisors are required, there are many value added advantages of allowing DCS to assist in the procurement of these advisors.  First, DCS expert affiliates themselves possess many of the legal, technical, tax, insurance/risk and commercial skill sets and we are best positioned to determine which additional outside third-party skill sets are required and which firms or individuals should be hired in these roles.  Secondly, construction and services contract drafting and advisory services requires the organizational management and coordination of many simultaneous workstreams.  DCS advisors are experts in project and program management services and are ideally suited to manage and coordinate a multi-dimensional advisory team most efficiently and effectively.

Complementing our comprehensive construction and service contract drafting and advisory services, DCS advisors offer the following complementary advisory services that may be applicable, dependent on the specific transaction situation.

• Transaction Advisory
• Debt and Equity Capital Raising
• Financial Modeling, Review and Audit
• Tender Management: RFEI/RFQ/RFP
• Mergers & Acquisitions Advisory
• Project/Program Management
• Strategic Planning
• Feasibility Studies
• Business and Asset Valuation
• Workouts and Restructuring
• Corporate Governance
• Training and Capacity Building Workshops

DCS experts provide comprehensive construction and service contract drafting and advisory services in the following sectors that we specialize in.  Please click on the below links to learn more about the sectors that we cover:

• Infrastructure
  • Transportation
  • Water & Wastewater
  • ​​​Solid Waste
  • Social Infrastructure
  • Telecommunications

• Energy & Utilities
  • Generation
  • Sales & Supply and Trading​

• Industrials
  • Engineering & Construction
  • Technology
  • Logistics, Cargo & Freight
  • Heavy Industries

• Oil & Gas
  • Upstream
  • Downstream
  • Midstream

• Real Estate
  • Warehousing and Logistical
  • Commercial and Mixed-Use

DCS experts provide comprehensive construction and service contract drafting and advisory services to the following categories of clients:

• Developers/Sponsors/Concessionaires
• Investors
• Corporations
• Governments/Governmental Entities
• Utilities
• Lenders
• Investment Banks
• International Financing Institutions
• International Agencies

contract drafting and negotiation services

construction, service & supply contracts