INTERNATIONAL TENDER

OF EPC PROJECT
國際工程投標

Presentation to ICDF, Taipei

March 31st 2005
John H. Lin ( 林俊華 )
 President, CTCI Corporation
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 Agenda
 Definition of International EPC Projects
 Definition of EPC Projects
 Typical International EPC Projects
 Current Trend of International EPC Projects
 EPC Projects Development
 EPC Projects Bidding Procedure
 Business Model of International EPC Contractors
 SWOT of Taiwanese Contractors in the
International EPC Projects
 Winning strategy of a Taiwanese Contractor –
sharing experiences
 Open discussion 2
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DEFINITION OF INTERNATIONAL EPC PROJECTS

 Investors
 Foreign Government / State-Owned Enterprises
 Foreign Private Sectors
 Project Location
 A foreign location
 Project Fund / Budget Source
 Foreign Government
 Shareholders
 Project Finance by the Owner (International Financial
Institutes and Commercial Banks)
 Project Finance by the Contractors (EXIM Bank and
Commercial Banks)
 Players
 International E&C Firms from the Developed Countries 3
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 DEFINITION OF EPC PROJECTS

 E: Engineering & Design

 Process Design (PFD)
 Basic Design (FEED)
 Detailed Design

 P: Supply of Equipment & Materials

 Ps: Procurement Service

 C: Construction
 Cm: Construction Management Service
 Ca: Construction Advisory Service

 K: Commissioning & Start-UP

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 TYPICAL INTERNATIONAL EPC PROJECTS

 Gas Processing
 Chemical Process Industries (Refinery,
Petrochemical, Chemical, etc.)
 Power Plants (Coal-Fired, Gas-Fired, Hydro, Nuclear,
Wind, etc.)
 Steel Mills
 Infrastructure (MRT, High Speed Rail, Highway,
Harbor, Airport, Dam, Desalination, etc. )
 Environmental (Wastewater, Municipal Waste
Incineration, De-Nox, De-Sox, etc. )
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 CURRENT TREND OF INTERNATIONAL EPC
PROJECTS
 Booming in the Countries either with Low Cost Raw
Material or Huge Market
 Mid East
 PR China
 Mega-Sized and Complicated Project
 Integrated Complex
 World-Scale Capacity
 Global Keen Competition
 Project Finance
 Partnering Arrangement 6
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 EPC PROJECTS DEVELOPMENT (1/2)
 Project Planning & Preparation Phase
 Project feasibility study and Define Scopes
 Government / Regulatory Approval
 Funding / Budgeting

 Project Definition Phase

 Technology / License Selection
 PMC / Engineer Selection
 Process Design / Basic Design

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 EPC PROJECTS DEVELOPMENT ( 2/2 )
 Project Implementation Phase
 Pre-Qualification of the Potential Bidders
 EPC Bid (ITB, Site Visit, Clarifications, Bid Submittal)
 Contract Award (Clarification & Negotiation)
 Project Execution
 Pre-Commissioning & Commissioning
 O&M Phase
 Start-Up & Operation
 Maintenance

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 EPC PROJECTS BIDDING PROCEDURE
Project Planning & Project Definition & Implementation Implementation Phase
Preparation Phase Phase

Owner Contractor
Marketing/Sales
Feasibility PMC/Engineer Process/ Approach
Study Selection Basic Design Project Execution
Bidding Strategy

Partnering
Define Engineering Procurement
Scope ITB PQ Evaluation
Preparation & Clarification PQ Proposal Design /Supply

Funding ITB Site Survey &

Budgeting Clarification Construction
Bid Evaluation & Cost Estimate &
Clarification Bid Submission

Bid Negotiation

Letter of Intend

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Contract Negotiation
& Signing 9
 BUSINESS MODEL OF INTERNATIONAL EPC
CONTRACTORS ( 1/2 )

 Partner Structuring (contract scheme)

 Consortium, Vertical Split, Joint and Several
 Joint Venture, Share Profit & Loss
 Prime and Sub, Horizontal Split
 Global Resources Integration
 Low Cost Engineering Offices
 1st Layer Management by Expat
 2nd Layer Management by 3rd Countries
 3rd Layer by Local Sub

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 BUSINESS MODEL OF INTERNATIONAL EPC
CONTRACTORS ( 2/2 )

 Risk Management
 Technical, Commercial, Financial
 Risk Analysis, Risk Transfer, Risk Mitigation, and Risk
Control
 Support by Financial Institutes
 Project Finance by EXIM Bank and Commercial Banks
 Bonding via Global Network

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 SWOT OF TAIWANESE CONTRACTORS
IN THE INTERNATIONAL PROJECTS

 Strength – Well-Educated Engineers with Diversified

Construction Experiences and Devoted Mentality

 Weakness – Lack of Projects Records, English Language

Barrier, Poor Support by EXIM Bank and Related Industries

 Opportunity – Numerous
 Threat – Contractors from Korean, PR China and Indian

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 WINNING STRATEGY OF A TAIWANESE
CONTRACTOR –SHARING EXPERIENCES
 How could you be invited to bid alone or with a
partner?
 What benefits you can bring it to a partner?
 Establishment of projects records
 Project management capabilities
 Global EPC capabilities and experiences
 Finance capabilities
 Joint forces of Taiwanese contractors
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OPEN DISCUSSION

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Thank You

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 Project X, KSA
Contract Scheme February 2005

Project X

IK Contract OOK Contract

Com. B CTCI
Com.B CTCI
Arabia Arabia Bridging Agreement
(Un-incorporated JV) (Un-incorporated JV)

JV Ratio: TBD JV Ratio: TBD

Outsourcing Lump Sum Lump Sum Outsourcing Lump Sum

Contractors/ Com.B CTCI

Suppliers Com.B CTCI
Suppliers Arabia Arabia

Construction Construction Technology Detailed Engineering

Management Construction Management Basic Design E/P Project Management
E/P Project Management 16
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