Capital project dispute resolution

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1 Capital project dispute resolution A pragmatic approach for securing high quality, business driven outcomes in capital project disputes Admired as advisers that adopt a rigorous business focused approach to resolve capital project disputes worldwide May 2016

2 Parties are generally in dispute way before they think they are Daryl Walcroft, PwC US Capital Projects and Infrastructure Principal Capital project services When things go wrong in capital projects, contentious, costly disputes can sometimes be inevitable. But with the right governance and controls in place, contractors and owners can minimise delays and keep projects on course. PwC s Capital Project Services adopts a rigorous business case approach to help our clients resolve disputes. From the outset, we focus on achieving a high quality business driven outcome. That may mean resolving the dispute quickly to keep a project moving forward and costs down. Or where there s a solid case, with robust evidence in support, it may mean fighting no matter how long it takes. It s all about taking a big picture view and doing what s best for the business. Working on more than 800 infrastructure projects across the globe, we have in-depth experience in assessing owners and contractors positions and resolving any disputes pragmatically, rapidly and cost effectively. Our expertise includes Delay Critical path analysis, causation, variations, prolongation, disruption and acceleration, concurrency, float and pacing arguments. Quantum Financial impact of delay, evaluation of change, project financing and debt funding effects and loss of profits claims. Time is money For every pound we spent with PwC preparing for the dispute, we gained 40 through the settlement Senior Commercial Manager for a contractor on a major airport dispute Winning is vital I have a lot of confidence that with PwC I have the right people who can go to court and wipe the floor with the opposition Government sector client on a rail project dispute 2 Capital project dispute resolution PwC

3 Why PwC? Our delay and quantum experts have deep experience of dispute resolution in their specialist industries. Their advice is priced to suit differing budgets. We tailor our approach to deliver robust, defensible analysis, proportionate to the budget, presented with precision and clarity. Where appropriate, we use industry standard methods. We can also develop bespoke methods to suit specific client requirements. Our team includes over 70 engineers with wide ranging international experience of major project delivery across all industry sectors, including: transport, oil and gas, real estate, defence and information technology. Individual experts Winning analysis Capital project disputes can arise and escalate extremely quickly. Our global, multidisciplinary teams can be mobilised at short notice to help clients head off emerging threats or react to claims quickly and regain the initiative. We leverage cutting-edge forensic technologies to assist with analyses of large datasets and enable innovative presentation of findings. When disputes do occur, the quality of documentation can be key to the outcome. Our reports are well-structured and compelling, authored by leading practitioners and subjected to rigorous peer review and challenge. We re always clear about what is fact and what is opinion. PwC Capital project dispute resolution 3

4 Deep experience in capital projects Energy and utilities Real estate ICC arbitration over delays to the US$500m construction of 1000MW CCGT power station in the Philippines. Assessment of critical delays to the construction of a 650m 1200MW power station in Spain. Arbitration over delayed construction of an irrigation project in the Middle East. Advised a real estate client on the recovery of a delayed and over-budget 1bn development in the UK. Dispute over the delayed construction of a 750m iconic sports stadium in the UK. Arbitration concerning the timescale for the development if two new townships in India. Roads Airports ICSID arbitration regarding the delayed construction of 28 bridges in Turkmenistan. Mediation regarding the delayed construction of an elevated highway in Hong Kong. Oral evidence to a DAB regarding the criticality of delays to the construction of a large infrastructure project in Dublin. Binding mediation regarding delayed airport construction project in the Middle East. ICC arbitration concerning the delayed construction of a US$400m airport terminal building in the Middle East. Arbitration regarding termination of a concession to design, build and operate a new airport in the Asia Pacific region. Defence Process Supported the renegotiation of a multi-billion euro military aircraft contract between European nations and suppliers, to resolve the underlying dispute. Reviewed the contractor s estimated time and cost to complete a multi-billion pound sterling naval asset on behalf of government during contract renegotiation. Analysed delays to the engineering and construction of a chemical process plant in Saudi Arabia. Assessment of critical delays to cement plant construction in Nigeria, enabling the parties to negotiate a settlement. 4 Capital project dispute resolution PwC

5 Deep experience in capital projects IT Rail Dispute in Belgium regarding the delayed development of an IT project for the Belgian courts. Arbitration of a complex multi-party IT implementation in the UK. Supported the government in a public inquiry of the causes of significantly delayed and over-budget high-speed rail project in Asia. Mediation on a 300m+ railway dispute in Hong Kong. Marine Oil & Gas Assessment of the critical delays caused to the construction of a 68m luxury yacht (commissioned 74 weeks late). Assessment of delays and additional costs of new dock facilities in the UK. Review of the governance and controls failings that caused significant cost increases on the construction of a US$9bn oil refinery in Russia. Arbitration regarding delays to the installation of topsides for an FPSO. PwC Capital project dispute resolution 5

6 Services When disputes arise in capital projects, it s always helpful to involve objective advisers who can bring a fresh view of the challenges ahead. Whether companies are dealing with an emerging threat, the early stages of a dispute or have already entered a formal procedure, we can help. We always deliver a level of evidential rigour, supporting analysis, effective communication and proportionality appropriate to the situation from supporting a commercial claim to acting as an impartial expert. We carry out independent project reviews that identify any systemic risks and emerging threats, as well as areas of susceptibility to contractor claims. We provide a range of credible experts, with international experience in the delay and quantum aspects of disputes. Skilled in various sectors, our experts provide services that are priced to suit various budgets. They are fully supported by an experienced team. Services We advise clients throughout contract-reset negotiations and other change events. This includes analysis of delay impacts and quantum of loss, along with an assessment of any entitlement to additional costs. To support client s preparation for a dispute, we carry out whatever analysis is needed to place them in the strongest possible commercial position. This enables the client to make informed decisions on dispute strategy in particular, whether it makes business sense to proceed, or avoid the dispute and seek a settlement. 6 Capital project dispute resolution PwC

A global team supporting clients worldwide PwC s Capital Project Disputes team helps clients worldwide to achieve business-focused outcomes in dispute situations.

7 A global team supporting clients worldwide PwC s Capital Project Disputes team helps clients worldwide to achieve business-focused outcomes in dispute situations. Where possible, we aim to defuse problems before they escalate. But if negotiations fail, we bring our leading experience in dispute resolution to bear to help clients prevail. In emerging markets we bring local knowledge of business practices, culture and regulations to bear in assisting our clients to find the best route to resolve the commercial issues they face. To find out more about PwC s Capital Project Disputes team, please contact Anthony Morgan anthony.j.morgan@uk.pwc.com +44(0) David Savage david.r.savage@uk.pwc.com +44(0) Paul Steen paul.b.steen@uk.pwc.com +44(0) PwC Capital project dispute resolution 7

8 This publication has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, PricewaterhouseCoopers LLP, its members, employees and agents do not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it PricewaterhouseCoopers LLP. All rights reserved. In this document, "PwC" refers to the UK member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see for further details DS-OS

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