In the intricate world of Public-Private Partnerships (PPPs), effectively Managing Construction Risks in PPP Projects is absolutely paramount, as the successful delivery of critical infrastructure hinges significantly on mitigating the myriad of uncertainties inherent in the design, build, and commissioning phases. Construction-related issues—ranging from unforeseen ground conditions and cost overruns to delays and contractor performance failures—can severely jeopardize a project's financial viability, extend timelines, and lead to contentious disputes, ultimately undermining the value proposition of the entire PPP. This comprehensive training course is meticulously designed to equip public sector officials, project developers, contractors, lenders, and legal professionals with the advanced knowledge and practical strategies required to identify, assess, allocate, and mitigate construction risks throughout the PPP lifecycle, ensuring timely completion, adherence to budget, and high-quality asset delivery. Without robust expertise in Managing Construction Risks in PPP Projects, stakeholders risk significant financial losses, project delays, and the erosion of public trust, underscoring the vital need for specialized expertise in this critical domain.

Duration: 10 Days

Target Audience

• Public Sector Project Managers and Engineers
• Private Sector Project Developers and Sponsors
• Construction Contractors and Sub-contractors
• Lenders and Financial Institutions involved in project finance
• Legal Professionals specializing in construction and project finance
• Risk Managers in infrastructure organizations
• Procurement Specialists overseeing construction contracts
• Technical Advisors and Consultants
• Project Owners' Representatives
• Anyone involved in the planning, execution, or oversight of construction phases in PPPs.

Objectives

• Understand the specific nature and complexities of construction risks in PPP projects.
• Learn about the various types of construction risks (technical, financial, contractual).
• Acquire skills in identifying and assessing construction risks throughout the project lifecycle.
• Comprehend techniques for optimally allocating construction risks between parties.
• Explore strategies for mitigating construction risks through contractual and management tools.
• Understand the importance of robust EPC/construction contracts in PPPs.
• Gain insights into managing variations, claims, and disputes during construction.
• Develop a practical understanding of performance security and insurance for construction risks.
• Master monitoring and progress reporting during the construction phase.
• Acquire skills in managing interfaces between construction and other project phases.
• Learn to apply international best practices and standard forms for construction contracts.
• Comprehend techniques for ensuring quality control and health & safety on site.
• Explore strategies for managing stakeholder expectations during construction.
• Understand the importance of handover and commissioning processes.
• Develop the ability to lead and oversee effective construction risk management in PPPs.

Course Content

Module 1: Introduction to Construction Risks in PPPs

• Definition of construction risk in the context of PPP projects.
• Why construction risk is a critical phase for project success.
• Unique characteristics of construction risk in PPPs (long-term, complex interfaces).
• Consequences of unmanaged construction risks (delays, cost overruns, disputes).
• Overview of the construction lifecycle in a typical PPP.

Module 2: Types of Construction Risks

• Technical risks: design errors, unforeseen ground conditions, technology failure, material defects.
• Financial risks: cost overruns, inflation, currency fluctuations, funding availability.
• Program/Schedule risks: delays, contractor performance, sequencing issues.
• Legal/Contractual risks: scope creep, variations, claims, liquidated damages.
• External risks: force majeure, political interference, environmental permits.

Module 3: Risk Identification and Assessment during Construction

• Methodologies for identifying construction risks (e.g., risk registers, workshops, checklists).
• Quantitative and qualitative assessment of construction risks.
• Probability and impact analysis specific to construction activities.
• Early warning indicators for potential construction problems.
• Role of technical due diligence in identifying pre-construction risks.

Module 4: Optimal Allocation of Construction Risks

• Principles of risk allocation in construction (to the party best able to manage it).
• Allocation of specific construction risks between public authority, SPV, and EPC Contractor.
• Impact of risk allocation on bid price and project bankability.
• Balancing risk transfer with contractor incentives and capabilities.
• The "fit-for-purpose" approach to risk allocation.

Module 5: Engineering, Procurement, and Construction (EPC) Contracts

• Role and structure of the EPC contract in PPPs.
• Key features: lump-sum, fixed-price, date-certain, single point of responsibility.
• Performance guarantees and liquidated damages in EPC contracts.
• Warranties, defects liability, and performance bonds.
• Integrating the EPC contract with the overarching PPP/concession agreement.

Module 6: Other Key Construction Contracts and Interfaces

• Construction supervision and independent engineer contracts.
• Supply contracts for key equipment and materials.
• Interface management between design, procurement, construction, and operations.
• Management of interfaces with existing infrastructure and third parties.
• Subcontractor management and flow-down clauses.

Module 7: Cost Management and Control

• Budgeting and cost estimating techniques.
• Contingency planning and management of cost overruns.
• Earned value management for progress and cost tracking.
• Cost control measures and reporting systems.
• Managing inflation and currency risk during construction.

Module 8: Time Management and Schedule Control

• Critical Path Method (CPM) for schedule planning.
• Progress monitoring and reporting (e.g., S-curves, look-ahead schedules).
• Identifying and mitigating delays.
• Acceleration strategies and their cost implications.
• Liquidated damages for delay and extension of time provisions.

Module 9: Quality Management and Control

• Quality assurance and quality control plans for construction.
• Design review and approval processes.
• Material testing and inspections.
• Commissioning and testing procedures.
• Handover requirements and defects liability period.

Module 10: Health, Safety, and Environmental (HSE) Management

• Legal and contractual requirements for HSE in construction.
• Developing and implementing site-specific HSE plans.
• Incident reporting and investigation.
• Promoting a safety culture on construction sites.
• Environmental compliance during construction activities.

Module 11: Variations, Claims, and Dispute Resolution

• Process for managing variations (changes to scope/design).
• Identifying and analyzing construction claims (e.g., delays, disruptions, unforeseen conditions).
• Claim preparation and substantiation.
• Dispute avoidance mechanisms (e.g., Dispute Boards).
• Dispute resolution procedures (negotiation, mediation, arbitration).

Module 12: Performance Security and Insurance

• Types of performance security: performance bonds, bank guarantees.
• Purpose of performance security in construction contracts.
• Key insurance policies for construction projects (e.g., CAR/EAR, professional indemnity).
• Public sector's role in reviewing and approving insurance coverage.
• Claims process for insurance.

Module 13: Progress Monitoring, Reporting, and Lender Requirements

• Establishing robust monitoring systems for construction progress.
• Regular reporting to the public authority, sponsors, and lenders.
• Lender technical advisor's role in monitoring.
• Disbursement conditions linked to construction progress.
• Managing information flow and communication.

Module 14: Handover, Completion, and Defects Liability

• Practical completion and final completion certificates.
• Requirements for handover of assets to the operator.
• During the defects liability period (DLP), managing latent defects.
• Final payment and release of retention money.
• Transition from construction to operational phase.

Module 15: Case Studies and Best Practices in Construction Risk Management

• In-depth analysis of specific PPP projects with significant construction challenges.
• Discussion of successful and unsuccessful strategies for managing construction risks.
• Lessons learned from major construction failures in infrastructure projects.
• Review of international standard forms of construction contracts (e.g., FIDIC).
• Workshop: Identifying and mitigating construction risks for a hypothetical PPP project.

Training Approach

This course will be delivered by our skilled trainers who have vast knowledge and experience as expert professionals in the fields. The course is taught in English and through a mix of theory, practical activities, group discussion and case studies. Course manuals and additional training materials will be provided to the participants upon completion of the training.

Tailor-Made Course

This course can also be tailor-made to meet organization requirement. For further inquiries, please contact us on: Email: info@skillsforafrica.org, training@skillsforafrica.org Tel: +254 702 249 449

Training Venue

The training will be held at our Skills for Africa Training Institute Training Centre. We also offer training for a group at requested location all over the world. The course fee covers the course tuition, training materials, two break refreshments, and buffet lunch.

Visa application, travel expenses, airport transfers, dinners, accommodation, insurance, and other personal expenses are catered by the participant

Certification

Participants will be issued with Skills for Africa Training Institute certificate upon completion of this course.

Airport Pickup and Accommodation

Airport pickup and accommodation is arranged upon request. For booking contact our Training Coordinator through Email: info@skillsforafrica.org, training@skillsforafrica.org Tel: +254 702 249 449

Terms of Payment: Unless otherwise agreed between the two parties’ payment of the course fee should be done 7 working days before commencement of the training.