Kangaroo Island

Australia

The client, Kangaroo Island Plantation Timbers Limited (KIPT) wished to establish sustainable timber industry on Kangaroo Island, South Australia, and as part of this was to develop a deep-water port at Smith Bay, a greenfield site on the north coast of Kangaroo Island in South Australia.

The project value was USD 40-50M. The Environmental Impact Statement (EIS) for the Smith Bay wharf proposal was released for public comment the last stage of the approval process was with the South Australian Government, Minister for Planning.

Procurement Model & Procurement Process

The procurement of a construction contractor was done at feasibility stage on a one-on-one basis using an ECI approach. The client needed to know the cost to build such a marine facility on a greenfield site and approached a local South Australian marine contractor to assist with budgets, feasibility studies, assessment of site location and choices of wharf construction, optimization, etc. There was no formal process for the selection of an ECI contractor.

Factors to adopt Early Contractor Involvement

The client was not an experienced port operator which is why it sought a contractor willing to be involved in the project from an early stage looking at the most optimal design. The ECI contractor sought to optimize and reduce the CAPEX cost of wharf construction by procuring a floating pontoon in South-east Asia rather than to follow the traditional approach of a fixed wharf arrangement using sheet or driven piles. The client wanted that the ECI contractor’s procurement decisions were transparent, made on best-value rather than lowest cost.