Procurement in engineering, procurement, and construction (EPC) projects refers to the process of acquiring goods, services, and works from external sources. The scope of procurement in EPC projects includes the purchase of materials, equipment, and services needed for the execution of the project and finally arrange the purchased item to be available at needed location. This can include a wide range of items such as raw materials, machinery, and specialized equipment, as well as professional services like engineering and consulting.
The procurement process in EPC projects begins at the project planning stage, where the project requirements are defined and a procurement plan is developed. The procurement plan outlines the types of goods and services required, the quantities needed, and the schedule for acquiring them. The plan also includes the selection criteria for potential suppliers, the evaluation process for selecting suppliers, and the terms and conditions for the purchase of goods and services.
The EPC contractor is responsible for procuring the goods and services required for the project. The EPC contractor will issue requisition or requests for proposals (RFPs) or invitations to bid (ITBs) to potential suppliers, and then evaluate the proposals or bids received in order to select the most suitable suppliers. The selection of suppliers is based on a number of factors, including the supplier’s technical capabilities, their past performance, and the price of the goods or services offered.
Once suppliers have been selected, the EPC contractor will negotiate contracts with them. Contracts typically include detailed specifications for the goods or services to be provided, as well as terms and conditions related to payment, delivery, and performance. After contracts have been executed, the EPC contractor is responsible for managing the suppliers’ performance, expediting, and ensuring that the goods and services are delivered on time and to the required quality standards.
Overall, the scope of procurement in EPC projects is wide-ranging and includes all the activities required to acquire the goods, services, and works needed for the successful completion of the project. The procurement process is critical to the overall success of the project, as the timely and efficient procurement of materials and services is essential for meeting project schedules and budgets.