Role of the Builder in PPP’s

Vince D’Amico (Thiess)

}  $9 billion of Projects between 2000-2006, and expected to grow to $100 billion in the next 10yrs.

}  Current PPP expenditure lies in vicinity of 10-15% of total government procurement.

}  The Projects are classified as economic or social infrastructure.

}  One feature of the evolution of the Australian PPP market has been the increasing number of social infrastructure compared with economic.

All figures taken from a report by Infrastructure Partnerships Australia - Performance of PPPs and Traditional Procurement in Australia

}  “The PPP advantage increase (in absolute terms) with the size and complexity of projects.”- Infrastructure Partnerships Australia

}  Private Sector can add greater innovation and value for money than Public Sector.

}  PPP’s provide new sources of capital for public infrastructure projects.

}  Secure investments with strong credit rating over a long investment period.

}  Future PPP investment will be in economic infrastructure – such as water, energy, communications and transport.

}  PPP’s allow the Private sector access to new markets.

}  Private sector adds value through innovative design that lowers construction costs

}  Private sector offers reduced life-cycle maintenance costs and lower costs of associated risks in PPP’s.

}  Timelines are often provided in the EOI document

}  Construction planning is required to demonstrate understanding of other similar type buildings i.e. Hospitals, Prisons

}  Typically issues raised: ◦  Any Staging requirements ◦  Technical commissioning ◦  Hand over requirements

}  Identification of key Project risks }  Rating of the risks into categories i.e.

technical, commercial, HR, OHS&E }  Apply a value where possible }  Attach a probability for the likely hood of a

risk event }  Apply risk mitigation strategy }  Try and identify site specific issues

}  Builders often engage sub contractors at an early stage to enable buildability and design is tested early in the design process

}  Partnering of key trades are often methods used in the past

}  Key trades are identified and then submissions are called from the market

}  Key trade partners are then asked to contribute to the EOI

}  Prefabrication must serve the design. }  Engage key contractors and suppliers early. }  Use 3-D design programs }  Build mock ups and test with user groups. }  Modules must be transportable on

conventional flatbed trucks or equivalent, or cost prohibitive.

}  Site constraints should be identified early }  Issues such as: ◦  Access to the site ◦  Traffic & pedestrian management ◦  Restrictions imposed by other users of the site ◦  Rail occupations �  Detailed process imposed by the rail authority �  Work method statements �  Inductions �  Process to work in a live corridor i.e. electrification

}  BIM is a tool used in the construction industry }  The 3-D aspect allows for early planning and

coordination of the various design disciplines }  BIM allows clash detection to be identified

early }  BIM allows an integrated package at hand

over for the Building Manager to have access to data on products used and maintenance records

}  AquaSure brings together three companies, all leaders in their fields;

�  Degremont - a Suez Environment company and world leader in reverse-osmosis desalination technology

�  Thiess – one of Australia’s largest and most trusted construction and services companies

�  Macquarie Capital – the world’s strongest and most experienced infrastructure advisor

}  Largest seawater desalination plant in Australia due for completion by the end of 2011

}  It will supply up to 150 billion litres of water a year to Victoria

}  The projects production represents one third of Melbourne’s annual water needs independent of rainfall

}  The major benefit of desalination is it delivers high quality drinking water without rainfall

}  Capital cost $3.46 billion }  $1 billion saving had the Project been delivered by

the Victorian Government }  30 year concession period. }  The desalination plant will be handed back to

government in full operating condition at no cost in 2039

}  Project benefits; ◦  Two way pipeline connecting South Gippsland and

Western Port to Melbourne’s water supply ◦  New communications cable to facilitate local broadband ◦  Up to 1,700 direct jobs created during construction ◦  $1 billion boost to Gross State Product ◦  New costal park with community recreation trails ◦  $12 million spent on local roads

}  Challenges ◦  Extreme weather conditions experienced ◦  Remote location ◦  Industrial relations

}  “However beautiful the strategy, you should occasionally look at the results.” Sir Winston Churchill

}  Thank you