Regarding the demarcation of the three parts in EPC
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In some newly established EPC companies in China, especially those in the power industry, it seems that the main tasks include design, procurement, technical services, procurement activities, construction management, and commissioning. There are some misunderstandings regarding the boundaries of EPC; I am looking for a precise definition and hope that some netizens can help. The following is an example of how an overseas company defined EPC for a chemical project in China, which I hope can provide some inspiration: Design, procurement, and construction together constitute Composite EPC. The cost structure is based on a price table, with design, procurement, and construction costs determined using man-hours or monetary values as specified in that price table. • Design is defined as all office-based work covered under the 81000 series of cost codes. This includes engineering design, procurement services, contract formulation, and support tasks such as document control and project management. Engineering is defined as including all office-based activities as specified in the 81000 series cost codes. This includes engineering, design, purchasing, contract establishment, and support services such as document control and project management. • Purchasing is defined as including all costs related to permanent equipment and materials. Such costs do not include procurement services, which are included in design and construction. Procurement is defined as including all costs related to permanent equipment and materials. This category excludes the costs of procurement services, which are included under Engineering and Construction. • Construction is defined as including all construction work, construction management activities, and construction equipment. Construction is defined as including all construction work, construction management activities, and construction equipment. 80000 LOT LOT – Design, procurement, and other service fees; Engineering, Procurement and Other Services (EO). 81100 MH MH – Fees for general design and basic design. 81200 MH MH – Fees for detail design and design of non-standard equipment. 81300 LOT LOT – Fees for as-built documents. 81400 LOT LOT – Fees for translation and reproduction of drawings. 81500 MH MH – Procurement service fees
From the perspective of contract signing, the design mainly includes process package design and procurement, as well as construction technical support； Procurement involves the purchasing, urging for delivery, inspection, and transportation of various materials (referring to the total of all equipment and bulk materials), while construction includes civil work, equipment installation and commissioning, as well as startup services. From the perspective of actual project management, EPC generally involves the tasks mentioned above, but the boundaries in terms of time and workload are not very clear. Therefore, we devote a considerable amount of space to defining these aspects in business contracts; thus, even for design contracts, the scope of work varies depending on the specific project.
The boundaries between work and personal time are not very clear, especially when project deadlines are tight; in order to shorten the timeline, many tasks are carried out simultaneously!
Thank you all! Everyone might have misunderstood what I meant. I mean, for the general contracting company, since its business already involves EPC, how does it carry out internal division of tasks? Especially when it comes to creating a WBS, this often requires detailed discussion.
For large-scale projects, procurement, delivery acceleration, inspection, storage, and distribution are all handled by separate contractors; our company specializes in taking on such projects
Internal structure of EPC: The design department is responsible for the technical aspects of the tender documents; once the project is awarded, it carries out feasibility studies, preliminary design, and detailed design work, while also coordinating with the procurement team to issue inquiries for prices and requests for equipment and materials； Purchasing tasks in the procurement department, including purchasing, urging deliveries, inspection, and equipment acceptance ； The Engineering Department is responsible for the construction management of subcontractors. I’m not sure if this satisfies the original poster.
Which department is responsible for the equipment selection or design verification in an EPC turnkey project? Does this require joint handling by the engineering department, the procurement department, and the client?
The equipment selection process should involve the process engineering department specifying the design requirements (in the form of data sheets) and providing them to the equipment engineering department, which then submits them to the procurement department for purchase. The verification of the designs is a task that falls within the responsibility of the various departments involved in the design process. The procurement department or the supplier shall organize coordination meetings to address matters related to technology, etc.; the owner may also be invited to attend such meetings.
Thank you! I wonder if the owner doesn’t have enough control over things Are the owners not overseeing the purchase of such important equipment?
The owner is God. For equipment selection, the owner’s opinion should be taken into account first, but the actual operation is handled by the general contractor. Owners should also participate in supervision, but some owners may delegate all responsibilities to the general contractor; this depends on the owners’ capabilities. It’s not necessarily correct; for reference only.
The WBS is clearly divided: the design includes process package design, basic design, and detailed design； Procurement involves requesting quotes, placing orders, manufacturing, and delivering the goods ； Construction involves pile foundations, civil work, and installation. Just WBS; that is, the detailed design is divided into various specialties ； Procurement is divided into equipment procurement and material procurement ； The construction is divided into pile foundation, civil engineering, and installation. It basically operates as normal, without deviating much from the standard functioning.
That’s right; if we adopt the E+P+C model, we will be responsible for all aspects of coordination, negotiation, and even on-site technical guidance. Then what are we? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? 、