The document discusses project management contracts, emphasizing their crucial role in project execution and the various parties involved, including the employer, engineer, and contractor. It highlights the importance of clear contractual terms to prevent disputes and outlines the responsibilities of project engineers, contractors, and employers in managing these contracts effectively. Additionally, it addresses legal considerations and requirements for communication and documentation throughout the project lifecycle.

1. SAJJAD KHUDHUR ABBAS
Ceo , Founder & Head of SHacademy
Chemical Engineering , Al-Muthanna University, Iraq
Oil & Gas Safety and Health Professional – OSHACADEMY
Trainer of Trainers (TOT) - Canadian Center of Human
Development
Episode 28 : Project
Management Contract

2. • most important document for the execution of a project.
• project management - know very well, includes all important
issues regarding supply and services
- Fulfillment of requirements, review the contractual
situation, to claim the respective extra costs
• project engineers :
- mastered the fundamental aspects of the contractual
arrangements for negotiated with subcontractor
- depends on the relevant information of the team members.
• actual contract arrangement - trained and experienced traders
and lawyers
• Fédération Internationale des Ing é-nieurs - Conseils ” (FIDIC)
-take equally into account the interests of Conditions of
Contract for Works of Civil Engineering and Construction
Conditions of Contract for Electrical an Mechanical Works
• jus strictum (binding law) and jus dispositivum (modifiable law).

3. • contractual terms defined in detailed schedule to avoid disputes
• 2 parties involved:
• Employer  called customer by the plant manufacturer, is usually
future plant operator
• Engineer  appointed employee chosen by employer (customer)
to show interest towards contractor
• Contractor  plant manufacturer; project manager as a
representative
COMPANY ABC:
Referred as an employer
COMPANY XYZ:
Referred as contractor

4. • Typical wording:
Excluding the delivery conditions of the contractor, the
following documents will apply to the present contract
exclusively in the following order:
The terms and conditions of this contract, its appendices and
its possible amendments.
The General Terms and Conditions of the employer
The quotation of the contractor from 11/11/2002
• General terms and conditions of the plant manufacturer are
excluded for the time being
- at this point legal matters with probably far - reaching
consequences are frequently addressed
• The wording “ apply exclusively in the following order ”
determines the hierarchy of the documents.

5. • It is difficult for the contractor to fulfill all the requirements of
such a listing  contradictions within the listed requirements are
possible
• For safety, the employer can insert the following contract clause:
In case of contradictions in this contract or
contradictions between this order and the
provisions mentioned above, the more
extensive provision shall prevail.

6. • To prevent the contractor ’ s deployment of inadequately qualified
and constantly fluctuating staff:
Employer:
Provide an organization chart:
-denominating all responsible employees involved in the project
Reserves the right to reject the appointment of the project manager:
- based on good cause
have relevant experience and the respective qualifications
Person/ Employee:
has to appoint a project manager who will be entrusted with the
coordination until the complete fulfillment of the order
If the contractor intends to make changes in staff :
- shall be coordinated with the employer
Contractor:

7. • an individual or a business that signs a contract to perform part
or all of the obligations of another's contract
• Plant manufacturer  responsible for the fulfillment of the
technical requirements of the project:
– claim extra costs
– reject the warranty for the respective components
• Operator  only has the possibility to limit the selection
• In practice:
– Operators may reserve rights to participate in technical part of
contract negotiation with sub-suppliers
– If demand going beyond specification, project engineer has
to point out this fact and communicate to project
management  respective supplementary offer can be
prepared

8. Precisely defined
Additional demand and stipulations:
Contractors
• prepares minutes of all meetings with the employer.
• prepares copies of all technical correspondence as well as of the
technical part of the minutes of meetings with his subcontractors.
• provides a monthly progress report.
• employer will be provided monthly with the updated project
schedule.
GOOD CONTRACTS Clearly stipulated

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