EPC & Alliances

EPC & AlliancesPONTICELLI REASONS TYPES

Interview of Philippe LECOISBusiness Development Manager

EPC & AlliancesPONTICELLI REASONS TYPES

Founded in 1921 PONTICELLI Frères is the major French mechanical contractor

Thanks to a highly skilled manpower, PONTICELLI Frères has been able to develop both in France and abroad its activities in the following fields :

Construction works :

Piping prefabrication and erection

EPC & AlliancesPONTICELLI REASONS TYPES

Machining works

Lifting/rigging

Equipment erection

EPC & AlliancesPONTICELLI REASONS TYPES

Maintenance :

- Maintenance management (sizing of maintenance activities, technical data-

base management, maintenance documentation drafting & management)

- Total maintenance contracts (long-term, incentive based, multi-skilled)

- Large shutdowns

EPC & AlliancesPONTICELLI REASONS TYPES

Turnover : 500 Millions d' Euros

Manpower: 5000

PONTICELLI REASONS TYPES

EPICC: Engineering, Procurement, Installation, Construction and Comissioning

≈ Turn-Key

EPC: Engineering, Procurement and Construction

A common form of contracting arrangement within the construction industry

EPC & AlliancesPONTICELLI REASONS TYPES

Under an EPC contract, the contractor:• Design the installation, • Procure the necessary materials • Construct it,

• Carries the project risk for schedule as well as budget in return for a fixed price, called Lump sum or LSTK

• Construction risk too great for the contractor • Preference of the owner to do the construction himself

Either through own labour or by

subcontracting part of the work

EP or E+P contract

REASONSPONTICELLI TYPES

EPC & Alliances

Reduction of risks for the contractorCriterias to analyse Yes? No?

ClientClient’s process

Technologic know-howCountryFinanceDelay

Ressources

Turn a « No » into

a « Yes »

REASONSPONTICELLI TYPES

EPC & Alliances

Criterias to analyse 0 to 4Client

Client’s processTechnologic know-how

CountryFinanceDelay

RessourcesTOTAL ???

0 : less risks…

4 : more risks

0<TOTAL<14comfort zone

15<TOTAL<28risky zone

Expectations of a decrease in margin

REASONSPONTICELLI TYPES

EPC & Alliances

Live up to clients' expectations in terms of• Security• Term• Quality• Cost

Economic intelligenceEach companies AlliancesSpecificities Common goalGoals TemporaryStrategy

≠

TYPESPONTICELLI REASONS

EPC & Alliances

Buying a service

Subcontracting More elaborate than buying• Provide ressources locally or a specific technical know-how• Made after the command with the clients

TYPESPONTICELLI REASONS

EPC & Alliances

Consortium

Consortium between Ponticelli ( 40%) Saipem et

and DesiconFor Total

An association of two or more, companies, organizations or governments with the objective of

participating in a common activity

GME (Groupement Momentané d’Entreprises)

TYPESPONTICELLI REASONS

EPC & Alliances

Consortium

• Share of the risks• No share of the ressources and benefits

• Reduce the costs

• Apply together for the call for tenders • Might be interdependent

Common responsibility or

All responsibilities given to representative

TYPESPONTICELLI REASONS

EPC & Alliances

Joint Venture

JV between Imer, Ponticelli and Suez,

for a Mitsubishi Heavy Industries

An entity formed between two or more parties To undertake economic activity together

Equity

TYPESPONTICELLI REASONS

EPC & Alliances

Joint Venture

• Only exists fiscally

• No existence legally

• Share of ressources, costs and margins

• Temporary

In France: « Société En Participation »

TYPESPONTICELLI REASONS

EPC & Alliances

The Project Manager:

• guarantee security • meet the deadline• ensure quality• control the costs

Must plane, organize, and manage ressources

Need technical knowledge and understand all the players

Thank youAny Question?