(I)' BC Hydr Pwer smart CONTRACTING PLAN Prtage Muntain Quarry Develpment and Operatin RFx N.: N/A - Direct Award CR N. 595755 Date: July 5, 2016 Dcument Name: Prtage Muntain Quarry_Cntracting_Plan_LF _Jul5-16.dcx Versin: O Revisin Date 1 f 7
(I) BC Hydr Pwer smart 1. PURPOSE The purpse f this Cntracting Plan is t btain early internal stakehlder supprt and apprval (at a summary level) fr Infrastructure Prjects Supply Chain t cmmence direct award negtiatins with, fr the. The cntract value will cunt twards the aggregate award amunt f directed prcurement under the IBA agreement. between BC Hydr and 2. PROJECT DESCRIPTION BC Hydr (Site C) requires an ecnmical surce f riprap material fr cnstructin f the Highway 29 realignment sectins and Hudsn's Hpe Shreline Prtectin Berm. The Prtage Muntain Quarry Develpment and Operatin cntract wuld include develpment f the quarry, a trial blast prgram and prductin and lading f riprap materials. BC Hydr intends t structure the cntract as a design-build-perate. The cntractr will be respnsible fr engineering, design, cnstructin, envirnmental prtectin, quality cntrl, quality assurance, and ther functins as required, t deliver the wrks identified in the cntract. The cntract will nt include clsure f the quarry at the f quarry peratins, as MTI has expressed an interest in assuming respnsibility fr the quarry nce peratins fr Site C are cmplete. The term f the cntract wuld be frm 2016 t 2021. 3. CONTRACT REQUIREMENTS 3.1 Scpe f Wrk The Scpe f Wrk will include: Quarry develpment including design and cnstructin f internal haul rads Design and implementatin f a trial blast prgram, which will cnsist f at least 3 blasts t determine yield; it will take apprximately 1 mnth fr the test blast reprt t be cmpleted Blasting is nly permitted frm May 15 - September 15, due t envirnmental requirements (bat hibernacula). Prductin f apprximately 200,000 m3 f riprap material fr cnstructin n Highway 29 and Hudsn's Hpe Berm Lading f riprap material Supply f all equipment necessary fr quarry develpment, testing, prductin, srting, stckpiling and lading f riprap material Design f internal haul rads t meet BC Energy and Mines' standards Trial blast and prductin blast plans by a registered prfessinal Submissin f EPP, SSSMP prir t cmmencement f in quarry activities Submissin f a quarry develpment plan including site remediatin BC Hydr has btained a Crwn Land licence f ccupatin permit, as well as an ccupant licence t cut which prvides permissin t undertake the trial blast prgram. BC Hydr will apply fr a permit t cntinue th.e peratin f the site as a quarry. 3.2 Financial EAR Value (Expected Amunt): $8.3358 Apprved n: December 2014 Dcument Name: Revisin Date Prtage Muntain Quarry_Cntracting_Plan_LF_Jul5-16.dcx Versin: O 2 f 7
CI> BC Hydr Pwer smart This cntract package is being funded frm the fllwing wrk packages: Cmpnent Charge Cde Hwv 29 Cache Creek Hwy 29 Halfway River Hwv 29 Farrell Creek Hwy 29 Dry Creek Hwv 29 Lvnx Creek Hudsn's Hpe Berm Ttals YM80004-5578-N002 YM80004-5175-N003 YM80004-8624-N006 YM80004-8604-N005 YM80004-8200-N004 YM80004-3318-A009 % f Ttal Aggregate frm Prtage 10.0 22.5 5.0 1.1 32.6 28.8 Re-allcatin $ Value t Prtage Sufficient funds were nt available within the prject t cver this cntract package. A draw f frm Prject Cntingency has been made t fund this wrk, per Change Ntice #35. An allcatin has been apprved by the Bard fr February 2016, but had nt been delegated t the Prject team. Cntract Estimate: Cntingency: Ttal CR amunt: The Cntract Estimate was prvided by and is based n the fllwing: A yield f 35% (althugh there are three ptins fr the yield 35% was used t determine the estimate) - if the yield was less the bttm line cst wuld g up. The cnstructin f internal rads; the plan wuld be t include the design and cnstructin f the haul rad as a lump sum item. Scpe includes mbilizatin, cnstructin f haul rad and stckpile area, trial blast, prductin, srt and stckpile, and lading f riprap fr ther cntractrs. Prductin quantities reflect definitin design vlumes fr Highway 29 and Hudsn's Hpe berm which may vary as design fr each segment advances. The Cntract Requisitin (CR) will be raised in PassPrt, based n the recent engineering cst estimate. The 20% cntingency is t address the fact that the yield fr lhe quarry is unknwn. Upn acceptance, this Cntracting Plan will be attached t the CR and the CR will require apprval in accrdance with BC Hydr's Financial Authrity Apprval Plicy ("FAAP"). 4. MARKET SOUNDING This cntract is intended as a direct award t cnducted. has experience wrking in cal peratins and in hard rck mineral extractin, and has a Memrandum f Understanding with N market sunding has been. 5. CONTRACT PLAN 5.1 Surcing Mechanism This cntract is intended t be unit price, because the quantities will be develped as part f the design fr Hudsn's Hpe Berm and the Highway 29 segments (i.e. certain Dcument Name: Revisin Date Prtage Muntain Quarry_Cntracting_Plan_LF_Jul5-16.dcx Versin: 0 3 f 7
(I) BC Hydr Pwer smart quantities will remain unknwn until the design is cmpleted). The term f the cntract will be frm 2016 t 2021 If the cntract is nt dne as a direct award t, the alternative plan is t g t market with a RFP. This will require time t pst n BC Bid, evaluate bids, negtiate the cntract and make the award. BC Hydr culd cnsider prescribing set asides t Abriginal businesses affiliated with Treaty 8 First Natins as part f the RFP. This apprach may prvide sme directed prcurement that culd cunt twards the IBA, but BC Hydr has less cntrl ver the nature and dllar value f that wrk. 5.2 Supplementary General Cnditins The fllwing Supplemental General Cnditins are anticipated: Liquidated damages I bnus: Liquidated damages wuld result frm a failure t supply vlumes f material at milestne dates. Liquidated damages wuld take the frm f additinal cst t btain riprap material frm ther surces. Bnus wuld result frm maximizing yield based n prductin technique. Site C specific labur, abriginal, safety and envirnment appendices will be added as a requirement f the cntract. 5.3 Abriginal Invlvement This cntract is intended as a direct award t. Abriginal inclusin reprting (subcntracting, emplyment and training) will be a cmpnent f the cntract. 5.4 Evaluatin The fllwing "High-Level Evaluatin Criteria" will be cnsidered as part f the direct award negtiatins: Cst cmpetitive Qualified persnnel t cnduct quarry develpment and peratin (esp. blasting) Ability and capacity t supply vlumes f material at milestne dates 5.5 Evaluatin Cmmittee (EC) The negtiatins will be cnducted by the fllwing individuals: Prject Manager - Engineering, Prject Estimating, Prject Scheduling - Cntract and Cnstructin Management - The EC may be prvided with advice frm Subject Matter Experts frm the fllwing areas: Quality Assurance - Safety- Abriginal Prcurement - Envirnmental - 5.6 Prcurement Schedule The prcurement schedule is anticipated t be as fllws : Apprve CR June 2016 Negtiate Direct Award July - September 2016 Apprve Recmmendatin t Award September 2016 Award cntract September 2016 Dcument Name: Revisin Date Prtage Muntain Quarry_Cntracting_Plan_LF_Jul5-16.dcx Versin: O 4 f 7
(I) BC Hydr Pwer smart 6. KEY RISKS AND MITIGATION 6.1 Key Risks and Mitigatin 6.1.1 Prcurement Risk Direct award negtiatins must prceed quickly in rder t award the cntract by September 2016. BC Hydr has met with, and is cmfrtable that they have the interest, capacity and qualificatins t d this wrk. 6.1.2 Schedule Risk The prcurement schedule is based n cmpletin f the trial blast prgram by June 2017, in rder t have material ready fr the Cache Creek rad cnstructin cntractr by September 2017. Cncurrent with cnducting the trial blast prgram, the quarry cntractr will have t design and build the access rad t the quarry, which is n a very steep grade n rck, s prbably difficult t d after Octber 2016 (t icy). On this schedule, the Highway 29 Cache Creek Bear Flat rad cntractr may have t use rip rap resulting frm the trial blast prgram. The mitigatin plan is t btain material frm an alternate surce at extra distance and extra cst t BC Hydr. 6.1.3 Financial (Cst) Risk Inefficient prductin technique culd result in increased csts. The mitigatin plan is a bnus fr effective prductin technique. Finance has queried whether BC Hydr may have t pay ryalties n material leaving the site t the Prvince, which culd have an impact n budget. This issue is being addressed as part f a brader questin that has been raised relating t the payment f ryalties by BC Hydr t the Prvince respecting all the quarries perated fr the cnstructin f Site C. 6.1.4 Scpe Creep Risk Additinal material may be required due t increases in design vlumes fr segments f highway design. The mitigatin plan is t ensure that any additinal vlumes have surces f funding t cmpensate fr increased requirements. 6.1.5 Safety Risk Operating a rck quarry is a high risk activity. The mitigatin plan is t ensure a qualified blasting cntractr is put frward during negtiatin and t mnitr cmpliance with the site specific safety management plan fr blasting, hauling, srting, stckpiling and lading peratins. 6.1.6 Envirnmental Risk Impact t identified envirnmental features. The mitigatin is t mnitr cmpliance with the EPP.. 6.1. 7 Perfrmance Security Risk Mitigatin is t btain perfrmance bnds and insurance. 7. NEGOTIATION AND EXIT STRATEGIES The prcess being fllwed is defined in the IBA where the cntractr is given 3 pprtunities t cme t an agreed negtiated price fr this cntract. 8. SUMMARY Based n the assessment f the prject requirements, market cnditins and risks pertinent t Dcument Name: Revisin Date Prtage Muntain Quarry_Cntracting_Plan_LF_Jul5-16.dcx Versin: 0 5 f 7
C BC Hydr Pwer smart this cntract package, it is recmmended that the subject Cntracting Plan be apprved. Dcument Name: Prtage Muntain Quarry_Cntracting_Plan_LF _Jul5-16.dcx Versin: 0 Revisin Date 6 f 7
(I) BC Hydr Pw er smart APPROVAL APPROVAL Prepared b J3eviewed Q -,---~~~--trll-'-"' t-\:l'-+-..l!>l~---j Reviewed b Apprved by Date ) 'L ~~ 2-01 6 Date Dcument Name: Prtage Muntain Quarry_Cntracting_Plan_LF _Jul5-16.dcx Versin: O Revisin Date 7 f 7