A defined lump sum plan expresses employees’ pension benefits as a lump sum amount, which makes it easy for them to understand and appreciate the benefits. In many cases, the plans also allow employees to accrue larger benefits at younger ages than they would under a traditional pension plan. And, increasingly, defined lump sum plans provide “portable” benefits that employees can take with them if they leave the company before retirement age.
Cost-plus construction contracts are often used for projects in which an owner or developer wishes to retain flexibility in selecting construction materials or modifying the design during construction. Unless specifically described in the contract, the contractor and the owner/developer may have a different perception of what types of costs are reimbursable to the contractor. The cost-plus contract should include a section defining all of the types of costs that are reimbursable by the owner/developer, and most standard form contracts include such provisions.
A cost-plus-fixed-fee contract is a cost-reimbursement contract that provides for payment to the contractor of a negotiated fee that is fixed at the inception of the contract. The fixed fee does not vary with actual cost, but may be adjusted as a result of changes in the work to be performed under the contract. This contract type permits contracting for efforts that might otherwise present too great a risk to contractors, but it provides the contractor only a minimum incentive to control costs.
Design and build contract, also known as “package deal” and ‘turnkey” contracts Turnkey drilling services offer a viable method for operators to better man age drilling risks and reduce costs. In the future, they may be able to utilize drilling management contractor services for complete field development programs. The offshore turnkey drilling industry remained a high-margin, low-volume business until about 1993 when turnkey drillers began to realize bidding prices were not competitive with most operators’ internal cost estimates.
Increasing market share could only be achieved by reducing margins to match the real competition, which is the operator’s AFE (authority for expenditure). Since then, the number of offshore turnkey wells has increased almost every year. However, the future of the offshore drilling management services industry involves moving beyond merely providing a well or a completion for a fixed price. It means working with an operator and other service companies to provide a range of services for complete field development, from drilling and completion to facilities design, installation, and field management through depletion.
Construction management contract plans. Construction management or construction include courses in project control and development, site planning, design, construction methods, construction materials, value analysis, cost estimating, scheduling, contract administration, accounting, business and financial management, building codes and standards, inspection procedures engineering and architectural sciences, mathematics, statistics, and information technology.