Standardization Benefits for Megaprojects, Illustrated by Motor and Drive Case Studies

Abstract This paper discusses standardization benefits for megaprojects drawing on first hand experiences from actual executed global projects and the collected opinions of End Users and Engineering Procurement Contractors (EPCs). Megaprojects are characterized not only by their huge scale but also through the many global parties required to execute and the number of partners involved in funding and finally operating the constructed enterprise. All these relationships mean difficult agreements on preferred vendors and specifications which can lead to multiple competitive bids to satisfy perceived ‘lowest' cost requirements. However, some studies have indicated that an additional 100% man hours is spent on engineering products to meet special project specifications rather than use industry standards. This is compounded when these particular project requirements have to be enforced across a number of different vendors for similar equipment. Consequently there is an industry-wide trend towards simplification and standardization not only to a small number of vendors on a project, but also to use as close to accepted industry and vendor norms wherever possible. Supplying motors and drives to global oil and gas, megaprojects is a complicated business because the equipment is not purchased directly by the EPC or the End User. Typically motors and drives are packaged by the compressor, pump, fan, hoist, HVAC etc. Original Equipment Manufacturers (OEMs) who may be myriad in number and located in various other different countries. Standardization provides significant CAPEX and OPEX benefits as well as reduce risk and man hours during project execution. In some cases it has been calculated to save as much as 14% of the total motor and drive project spend. The Main Motor and Drive Contractor (MMDC) methodology has been used successfully to provide simplification, standardization, reduced cost, less effort, fewer interfaces and lower risk on a number of megaprojects.