Advisian’s role 

Since 2010 Advisian has been providing a range of project commercial support and advice for the procurement and negotiation of many high value complex contracts, including: 

  • Rapid development and release to market of RFT documentation for mining works 
  • Comparative analysis of commercial delivery structure options for the project 
  • Infrastructure works 
  • Support for the preparation of EOI and RFP documentation and negotiation of high value contracts, including: $700 million of operational contracts: grade control drilling, assay laboratory services, down hole survey & geophysics, contract mining, explosives, mine fleet tyre - supply and sustain. 
    • Four multi-billion dollar ECI Contracts covering process plant, rail and port infrastructure. 
    • One multi-billion dollar ‘single wrap’ EPC Contract which aggregates all principal infrastructure work. 
    • $600 million of early infrastructure works including three million cubic metres of port dredging, 2,500 person township, airport, major roads, four x 500 person rail camps, 350 kilometre wide networks. 
    • $600 million of long lead time items, including locomotives, wagons, ore crushers, rail, sleepers, crushers, car dumper and ship loaders. 

Results

Despite the dynamic pressures of the current iron ore and capital markets, the project is on track for success. As of early 2013, towards $1 billion has been invested and the inherent flexibility and embedded resilience of the commercial strategy has responded to the very different commercial imperatives over time. 

This was demonstrated by the flexibility to move swiftly from an ECI commercial structure of four Australian Tier 1 contractors with separate scopes, to a single overarching commercial “performance based liability wrap” contract with a single major international (Korean) head contractor. The new structure retains the potential for the Australian majors to become some or all of the sub-contractors to the Korean firm. 

Implementing commercial strategies and negotiations to realise a $9Bn project