July 2, 2024

The Schedule Basis Memorandum: Camp Services Considerations

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This is the final blog post in a six-part series about the schedule basis memorandum. This post briefly discusses labor camp catering and other service risks associated with large and complex EPC projects.

Camp Catering and Other Service Considerations

Camp size increases after the initial design and construction of the camps involve more than just adding beds in housing units. The personnel occupying the beds require the same services as the base loading personnel for which the camps were originally sized. Cooking, catering, laundry, potable water supply, sewage treatment, and recreational facilities are often bottlenecks when camp sizes need to be increased during a project. If the camps are undersized, the most likely outcome will be an overall project delay that keeps construction, pre-commissioning, commissioning, and start-up personnel on site for longer than originally planned. Delays in de-staffing labor camps will likely lead directly to increases in catering and similar costs. Typically, the EPC contractor is responsible for following risks:

  • Increases to catering and other service costs due to the contractor’s estimating errors prior to contract award.
  • Increases in labor and supervision resulting from lower than planned productivity due to the contractor’s estimating errors and/or performance problems.
  • Growth in catering and other service quantities attributable to the contractor’s delays.

In consideration of the above, the schedule basis memorandum should be utilized to document the initial rationale regarding assumptions, allowances, or exclusions included in the contractor’s baseline or updated schedule file. It is recommended that both the contractor and owner jointly review and adjust the schedule basis for camp catering and other service considerations.

Conclusions

The schedule basis memorandum is broadly defined as a written document that describes, explains, and details how the CPM schedule was developed at a specific point in time. The quality and reliability of the CPM schedule is directly tied to the thoroughness and completeness of the schedule basis memorandum which documents the planning rationales, assumptions, allowances, and exclusions. The schedule basis memorandum is a living document that may need updating from time-to-time during a project’s lifecycle when conditions are warranted.

It is not unusual, however, for a contractor to prepare and submit an overly general or vague schedule basis memorandum that does not provide an adequate level of detail or supporting rationale necessary to fully understand how the CPM schedule was developed. In extreme cases, a contractor may not prepare any form of written schedule basis in support of its CPM schedule. If a CPM schedule lacks a well-organized and documented schedule basis, then it is possible that legitimate changes to the initial schedule basis plan may be lost and construed as contractor scheduling deficiencies resulting in disputes which could have been avoided.

Large and complex EPC projects contain several inherent risks which can negatively affect the success of the project. Notable issues include overly optimistic labor productivity factors, competing projects, owner review and approval issues, inclement weather considerations, and camp size and camp services issues. It is recommended that the EPC contractor and owner thoroughly analyze these issues and document the results in the schedule basis memorandum. The success or failure of the time management of large and complex EPC projects may depend on the quality and detail of the supporting documentation contained in the schedule basis memorandum.

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