Turkey Project Management and Organization Research

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Turkey Project Management and Organization Research ORDER NOW FOR CUSTOMIZED AND ORIGINAL ESSAY PAPERS ON Turkey Project Management and Organization Research Please read the attached article “Organizing and Managing a Finance-Design-Build Project in Turkey” and answer the following questions. Turkey Project Management and Organization Research Please answer all questions fully. Short answers are not acceptable. attachment_1 attachment_2 Assignment 5 Please read the attached article “Organizing and Managing a Finance-Design-Build Project in Turkey” and answer the following questions. Turkey Project Management and Organization Research Please answer all questions fully. Short answers are not acceptable. What is the unusual thing that KGM did? Answer How is it a Finance-Design-Build Project? Answer What form of financing was chosen? Answer Who was responsible for design? Answer Why was Export Credit chosen for financing? Answer How did the JV work? Answer Were there any Construction challenges? Answer Were there any other challenges? Answer ORGANIZING AND MANAGING A FINANCE-DESIGN-BUILD 8 PROJECT IN TURKEY: FOURTH ROEBLING LECTURE, 1995 By Donald K. Stagerl Downloaded from ascelibrary.org by East Carolina University on 10/16/14. Copyright ASCE. For personal use only; all rights reserved. ABSTRACT: It has been estimated that an expenditure of $200 billion per year must be made on the world’s infrastructure for the foreseeable future. This will lead to many opportunities for U.S. contractors .to work internationally. Much of the work is located in emerging countries that do ~ot h~ve ~e money aV~lable to finance the projects that they need. The subject of this lecture is the Izmir-Aydm Project m Thrkey, which began as a fixed-price, finance, design-build job..The pr?ject is very in~resti?g, and shows the m~y pr.oblems that may be faced during the execution of an mternational contract, mcludmg lack of payment, Ignonng contract provisions, changes in government, and politics in general. some similarities in the political challenges encountered on both projects. INTRODUCTION First, I would like to thank the Construction Division of the American Society of Civil Engineers for selecting me as the 1995 Roebling Award recipient. It is a great honor for me to be thought of in the company of the earlier recipients, George Fox, Martin Kelly, and Joe B. McNabb. I could not have achieved this recognition without a great deal of guidance and help from a large number of people at two fine engineering and construction companies, Guy F. Atkinson and Dillingham. I spent 30 years working for Atkinson, where I was mentored by George Atkinson, Bob Kerr, Joe McNabb, and many others. My last 14 years have been sp~nt with Dillingham, where I received help from Joe Casey, JI~ Perry, John Jacobs, Mike MacGregor, Don Sundgren, and Bill Wilson, to name a few. My thanks to these people and the many others who have worked with me over the years for making it possible for me to receive this award. . During my career with Atkinson, I had the opportumty to work on a number of major projects such as The Dalles Dam on the Columbia River; Ice Harbor and Lower Granite dams on the Snake River in Washington; Trinity and New Melones dams in California; Mica, Seven Mile, and Peace Site I dams in British Columbia; Mangla Dam in Pakistan; Sabana Yegua Dam in the Dominican Republic; Colbun Dam in Chile; Thrimaquiri and Guri dams in Venezuela; and the Ramon Airbase project in Israel. Some of the more notable projects I have been associated with since joining Dillingham are the Izmir Ring Road-Aydin Motorway in Turkey; Cerrillos Dam in Puerto Rico; Peace Vector IV, Military Air Base, Egypt; Masirah Island Military Air Base, Oman; 180 MW AES Cogeneration Plant, Hawaii; Tarbela Hydropower Plant, Pakistan; Balsam Meadow Underground Hydropower Plant in California; and the Route H-3, Halawa Thnnels in Hawaii. Given my past experience, you might expect me to choose a topic associated with dam construction for my paper. However, I would like to talk about the Izmir Ring Road-Aydin Motorway Project in Turkey. Road construction, even of the magnitude of the Izmir-Aydin Project, does not present the engineering challenges faced by the Roeblings in the construction of the Brooklyn Bridge. However, I believe you may find “Delivered at the American Society of Civil Engineers Construction Congress, October 24, 1995, held in San Diego, Calif. ‘CEO, Dillingham Construction Holdings, Inc., P.O. Box 1089, Pleasanton, CA 94566-0199. Note. Discussion open until February I, 1997. Turkey Project Management and Organization Research To extend the closing date one month, a written request must be filed with the ASCE Manager of Journals. The manuscript for this paper was submitted for review and possible publication on March 12, 1996. This paper is part of the Journal of Construction Engineering and Management, Vol. 122, No.3, September, 1996. ©ASCE, ISSN 0733-9364/96/0003-0199-0204/$4.00 + $.50 per page. Paper No. 12814. BACKGROUND It has been estimated that an expenditure of $200 billion per year must be made on the world’s infrastructure for the foreseeable future. Much of this work is located in emerging countries that do not have the money available to finance the projects that they need. The Izmir-Aydin Project is interesting in that it began as a fixed-price, finance, design-build job. I believe that we will see more of this system of project contracting as we move forward to the year 2000. In 1984, Thrkey, under Prime Minister Turget Ozal, embarked on a bold program to greatly improve its main highway systems. This program involved a number of projects, with its primary focus on providing a modem motorway built to international standards connecting Istanbul with the capital, Ankara, and a secondary focus of providing ring roads around Ankara and Izmir. Izmir is the third most populous city in Thrkey. The motorways are planned to be toll roads. The ring roads, which are designed to relieve heavy traffic congestion, would be free of tolls. The initial contracts were for a second crossing of the Bosporus and the associated access roads. These projects. were open to international bidding. After the successful bidders were chosen, the contracts awarded, and construction begun, the Ministry of Public Works-General Directorate of State Highways (KGM) did an unusual thing. Rather than seek additional competitive bids, they used the unit prices they received from the initial Bosporus bids to establish fixed-unit prices for the remainder of the planned motorway system. Thrkish contractors were encouraged to find foreign partners who would be able to arrange financing and would accept the previously established fixed-unit prices. These joint ventures were then awarded separate sections of the planned motorways to construct. In 1986, Dillingham had performed a small project in Turkey for the U.S. government. In doing this, a relationship was formed with a Turkish contractor, Kutlutas Insaat VE Ticaret Sanayi Ltd. Sti. (Kutlutas). In due course, Kutlutas advised Dillingham of the potential of obtaining the Izmir-Aydin Project and asked if we would be interested in forming a joint venture. It was made clear that arranging the financing would be the responsibility of Dillingham. We were given a limited set of the plans, specifications, and anticipated quantities with their respective fixed-unit prices. With this information, Dillingham prepared an estimate of the cost of construction and determined that the work could be performed within the fixedunit prices, with a reasonable margin for profit and contingency. After establishing that the project was feasible from a financial standpoint, Dillingham agreed to form a joint venture JOURNAL OF CONSTRUCTION ENGINEERING AND MANAGEMENT / SEPTEMBER 1996/199 J. Constr. Eng. Manage. 1996.122:199-204. Downloaded from ascelibrary.org by East Carolina University on 10/16/14. Copyright ASCE. For personal use only; all rights reserved. with Kutlutas (calling the joint venture KDJV) and proceeded to pursue financing. The first step in the search for financing was to select a financial advisor. Dillingham’s treasurer and chief financial officer met with several international banks and ultimately selected Chase Manhattan Bank to act as KDJV’s consultant. The total value of the project, based on the quantities provided by KGM, was approximately $296,000,000. This was to complete 54 km (33.6 mi) of three-lane ring road and 94 km (57.8 mi) of two-lane motorway, both with a maximum grade of 6%. The most favorable option for obtaining financing was through the use of export credits. In order to determine the amount of export credit that could be used, it was necessary to establish an equipment and material list that could be purchased outside Turkey. It was estimated that the project could use a total of $125 million of export credits from the U.S. and Japan, including construction equipment, services of a U.S. design firm, and Dillingham’s expatriate staff. Based on this, Chase was able to provide a financing proposal that included both export credits and commercial credits. The proposal was submitted to the Turkish government. The commercial credits were provided by the participating banks in amounts equal to the export credits.Turkey Project Management and Organization Research After several months of negotiations, KDJV was given a mandate to proceed with arranging the financing. With the assistance of the anticipated major equipment suppliers, the credit was syndicated with $100,000,000 of U.S. EXIM credit and $25,000,000 of Japanese export credit. The remainder was commercial credit. Fees paid by the KDJV associated with obtaining the credit amounted to about 2% of the total. From the time that loan documents were executed in London until KDJV was able to make the first draw under the U.S. EXIM credit was 9 months. Stamp duty on the loan of 0.5% ($1,500,000) was payable to Turkey. Several permits had to be obtained, but six months after KDJV had been awarded the project, we finally received the 20% advance payment provided for in contract conditions and began serious mobilization. Obviously, construction could not begin until KDJV had some final approved design drawings. As soon as the contract has been awarded, KDJV set in motion the process to select the designer for the project. Payment for design had been established as a provisional sum in the contract, and the client required that KDJV take three proposals from potential design firms. DeLeuw Cather, in joint venture with a local Turkish engineering firm, was ultimately chosen as the design engineer (referred to as DCK) at a cost of approximately 4% of the initial estimated value of the work. Shortly after the design contract had been awarded, KGM appointed a control engineer, Erer, Mayreder, Geoconsult (EMG), to oversee the construction and to review and approve the design drawings before passing them onto KGM for final approval. This complicated the progress of the design because we now had a third party who had their own ideas regarding design. This can be a problem with the design-build method of construction. Too many people with the authority to revise the design slow the approval process. Design had hardly begun when KGM changed the scope and criteria. The motorway section was widened to three lanes each way, and the maximum grade was dropped from 6% to 4.5%. The effect of this change was to greatly increase the excavation and embankment quantities and to increase the lengths of the anticipated tunnels. KGM was not inclined to view this as a change in scope for DCK. KGM generally held the view that they had purchased a design for the entire road regardless of whether or not it was shown on the preliminary plans or indicated in the specifications. This included additional interchanges, bridges, and roads from the new motorway linking it to existing major arteries. Change orders for the design effort were not forthcoming from KGM, which ultimately led to KDJV negotiating an additional payment to the design engineer from their own resources in order to complete the design drawings. A claim for this extra work is still pending resolution with KGM. While both KDJV and the design engineer thought they had a clear understanding of the scope of the design spelled out in their contracts, in hindsight this is an area that needed a much more detailed definition of the anticipated design effort. In this type of contract, it is absolutely necessary for all parties to fully understand what is expected from the design engineer. The design costs are now more than double the initial contracted amount. The joint venture agreement provided that each party had 50% and that Kutlutas would be the leader. A board of representatives and an executive committee were established to manage the project, with one member from each company, plus an alternate, assigned to each committee. The board of representatives was to determine policy, and the executive committee was charged with executing the policy. Initially, board meetings were held every other month, with executive committee meetings held monthly. Meetings generally lasted two to three days. Under the terms of the joint venture agreement, the leader was to nominate the project manager and Dillingham was to nominate the deputy project manager and the field operations manager. It was agreed that the main office of the joint venture was to be in Izmir, and this was where the project manager was to be located. However, it was decided that the joint venture must have an office in the capital, Ankara, to liaison with the client as well as with other important government offices. The project management and design teams jointly leased a building in Izmir and staffing the project began. Equipment requirements were determined and quotations were obtained from suppliers. It was necessary to select equipment to use the entire amount of the Japanese EXIM credits since they would not be available to cover U.S. expatriate costs. Turkey Project Management and Organization Research The cost of the equipment, shown in Appendix I, was approximately $75,000,000. THE PROJECT In setting up to manage the field operations, KDJV decided to divide the project into three areas because of the length of the motorway. Neither ready-mix concrete nor crushed aggregate was available, so it was necessary to locate quarry sites containing the quality of rock that would meet the specifications for asphaltic concrete. The locations of the quarries dictated the locations of the site offices, camps, repair facilities, concrete batch plants, asphalt plants, etc., because of the haul distance involved. The largest facility was established at Buca, which would service the entire ring road and a short section of the motorway. This location housed the main repair shop and warehouse. It was planned that all major repair would be handled in this shop, with only minor repairs and routine maintenance being done at satellite facilities at the other locations (see Fig. I). Constructing a three-lane, divided freeway does not involve any technical problems that have not been solved before, but when the project is done on a finance-design-construct basis and involved two long tunnels, a village that cannot be relocated, and very large quantities of materials, the contractor is faced with real challenges. This is particularly true because, since up until 1980, most road construction in Turkey was done by government forces. The quantities involved are much greater than all but the largest dam projects (see Table 1). The basic design of the road specified three lanes, 3.75 m (12.3 ft) in width each way, with a 3 m (9.8 ft) wide right shoulder and a I m (3.3 ft) wide left shoulder. The total pavement thickness of 75 cm (30 in.) consists of 28 cm (11 in.) of 200/ JOURNAL OF CONSTRUCTION ENGINEERING AND MANAGEMENT / SEPTEMBER 1996 J. Constr. Eng. Manage. 1996.122:199-204. .J.-_9_”_ _…. _ along the route as well as connections with existing major arteries in the city. The changes have been challenging and are still taking place as construction approaches each new area. The joint venture has had to remain very flexible throughout the project. I will not go into the overall construction of the road in this paper, but will focus on a few areas where KDN had the opportunity to employ some unique solutions to reduce cost or has encountered unanticipated difficulties. Downloaded from ascelibrary.org by East Carolina University on 10/16/14. Copyright ASCE. For personal use only; all rights reserved. CONSTRUCTION CHALLENGES ~ NESETIVEFACILITIES ==a FIG. 1. Izmlr.Aydln Motorway, Turkey TABLE 1. Summary of Major Work Items Major work Item (1 ) Excavation (excludes tunnels) Fill Piles Reinforcement Tieback (rock) anchors Concrete (all types) Culverts and drains Paving: Asphalt-Base Asphalt-Binder Asphalt-Wear [Total asphalt] [Total asphalt] Cement treated base Mechanical subbase [Total] [Total] Guardrail Tunnel excavation Quantity (2) Unit of measure (3) 68,580,000 89,700,000 56,090,000 73,366,000 140,000 460,000 90,000 99,000 75,000 246,000 1,100,000 1,439,000 300,000 984,300 Cubic meters Cubic yards Cubic meters Cubic yards Vertical meters Linear feet Metric tonnes Short tons Linear meters Linear feet Cubic meters Cubic yards Linear meters Linear feet 1,370,000 910,000 740,000 3,020,000 3,322,000 Metric tonnes Metric tonnes Metric tonnes Metric tonnes Short tons 1,200,000 3,110,000 4,310,000 5,637,500 580,000 1,903,000 2,550,000 3,335,000 Cubic meters Cubic meters Cubic meters Cubic yards Linear meters Linear feet Cubic meters Cubic yards mechanical subbase, 22 cm (8.7 in.) of cement-treated base, 12 cm (4.7 in.) of asphalt base, 8 cm (3.2 in.) of asphalt binder and, finally 5 cm (2 in.) of asphalt wearing course. There have been many changes in the scope of the project. The number of interchanges has grown from 10 to 24. This increase was caused by the addition of link roads to towns Since this was a design-build project, KDJV was in a position to propose using either cast-in-place concrete or precast, prestressed girders for bridge construction. The lowest cost option was determined to be precasting. Local facilities for casting our girders were not available. Therefore, the project had to construct its own. Considering the haul distances involved, the precast facility was located 33 km (20.5 mi) south of the ring road at the middle site, Torbali. Here two 165 m (541 ft) casting beds were built, with each capable of casting four beams at one time. KGM was concerned with the aesthetics of the bridges and, therefore, directed that box beams be used in metropolitan areas and “I” beams elsewhere. The beams vary in length from 14 m (46 ft) to 32 m (105 ft), with the majority being 30-32 m (98.4-105 ft). There are a total of 1,873 I-beams and 4,179 box beams to cast. When in production, the facility casts four beams per day.Turkey Project Management and Organization Research There are an estimated 451 km (280 mi) of nonreinforced concrete pipe in the project, varying in size from 15 cm (5.9 in.) to 100 cm (39.4 in.). Given this quantity of pipe, KDJV decided to build its own pipe manufacturing facility, also located at the middle site, Torbali. It purchased a Schlusselbauer Pipe Machine, Model-Magic 1501, made in Austria. The project to date has cast approximately 40% of the pipe required and is experiencing a rather high loss of 17%, due to damage or pipe that will not pass the leak test. Throughout the 147 km (91 mi) of roadway, there are more than 100 structures to be built. Obviously, the ground conditions vary considerably and, therefore, some structures required piling. Our joint venture partner had the equipment and experience to do cast-in-place piling, and this appeared to be the preference of KGM. Therefore, this was the pile foundation design that was used. All piles are 120 cm (approximately 4 ft) in diameter and generally are augured. KDJV has completed a little over 50% of the estimated 5,500 piles, with an average depth of pile of 21.4 m (70 ft), required. On the project, there were two areas located at the edge of the right-of-way that could not be moved. One was a shrine and the other was a village. The soil conditions were such that a stable cut slope could not be achieved and leave these structures in place. Very high cut slopes were involved, and it was determined to steepen the slope to 0.75 to 1.0, using tiebacks! rock anchors with shotcrete and wire mesh to support the finish slope. The anchors used were Dywidag Threadbar, 36 mm (1.42 in.) in diameter, grade 835/1030. The entire length of the 26.5 m (87 ft) thread bar was pregrouted in corrugated sheathing. After the bottom 6….. 10 m (20-33 ft) of the anchor was grouted, the anchor was posttensioned to 60 metric tons (t) and then the remainder of the 100 rom (4 in.) drilled anchor hole was filled with grout. KDJV has completed over 2,500 of these anchors to date. The greatest challenge in this operation was drilling the anchor holes and keeping them open until the anc … Get a 10 % discount on an order above $ 100 Use the following coupon code : NURSING10