Page 236 - Trenchless Technology Piping Installation and Inspection

200 Cha pte r F i v e

should complement the technical specifications by providing a clear
presentation of the crossing design as well as the results of topographic,
hydrographic, and geotechnical surveys.

5.3.7 Contractual Considerations
Once design of the crossing is complete, a set of contract documents
should be produced for solicitation of bids from contractors and to
govern construction of the crossing. Contract documents should be
structured to clearly present technical, commercial, and legal require-
ments. Contract forms applied to HDD projects can be separated into
four basic categories: lump-sum, turnkey (design-build), daywork (cost-plus)
or unit price (footage). For a lump-sum contract, the contractor is paid
a fixed amount for delivering a drilled segment in accordance with
plans and specifications. Payment is based on performance and does
not vary with the time or effort expended. A turnkey contract is simi-
lar to lump-sum, but the contractor assumes responsibility for the
design phase as well construction phase of the operation. For a day
work contract, the contractor is paid a fixed amount per day, or pos-
sible other unit of time, for providing equipment, required personnel,
and service, in accordance with the contract documents. For the unit
price contract, the contractor is paid based on the footage of pipe
actually installed, as measured horizontally on the surface.

Lump Sum Contracts
In most cases, Maxi-HDD installations are advantageously bid using
standard lump-sum contracts. (For convenience, bid prices may be
broken down for analysis.) Applicable technical specifications and
drawings should be included in the contract documents. A lump sum
contract allows the contractor the option of providing the most effi-
cient, cost-effective installation, without motivation to do an unnec-
essarily long or more complicated installation.
Turnkey (Design-Build) Contracts
A key aspect of this type of contracting is the partnering concept. The
owner and the contractor work closely together in planning, design,
cost control, scheduling, site investigations, and possibly land acqui-
sition or easement and project financing. A turnkey operation has the
potential of significantly reducing project cost and delivery time
while avoiding design-construction conflicts by having only one con-
tractor accountable for the entire project.

Daywork (Cost-Plus) Contracts
Because of the evolving nature of HDD technology, the industry has
employed many contract variations. Typically, these variations
involve negotiating a completion incentive into a cost-plus (daywork)
contract. Significant technical advances have been made because of
owner willingness to assume the risk of cost overruns or completion
delays for prospective HDD installations which were not contractually