During the construction of an LNG project, an engineering, procurement, and construction (EPC) contractor and its fabricator contested costs for incomplete and remediation work. Baker & O’Brien was retained to conduct an independent analysis of the work performed by the parties, including an evaluation of outstanding tasks and the reasonableness of completion costs. By providing detailed expert reports, independent cost estimates, and deposition testimony, we enabled the parties to reach a settlement prior to trial.

Large, complex construction projects in the energy industry often use modular fabrication as an execution strategy. Process modules and piperack modules are fabricated by specialized companies, utilizing dedicated fabrication facilities. Once completed, these modules are shipped to the construction site for installation and hook-up. To avoid project delays, modules may be shipped to the site before they are fully completed and inspected. When this happens, it causes carryover work at the site, which can become a contentious issue. The additional site construction scope to complete carryover work and address any non-conforming work or defects, can result in cost increases.

A construction dispute arose between the main EPC contractor and a module fabricator on a large LNG project. After the fabricated modules were delivered to the site, additional work was required to address incomplete work and problems associated with fireproofing, piping, coating, and insulation. The dispute concerned the costs of the additional work on-site.

Baker & O’Brien was retained to conduct an independent analysis of the work performed by the parties under the agreements, including the off-site fabrication work completed by the fabricator and the on-site carryover work completed by the EPC contractor. As part of our analysis, we identified the carryover work and assessed the reasonable cost of completing it. Our consultants reviewed the agreements, contemporaneous project completion records, and related claims to assess: (1) incomplete work; (2) defective work; (3) corrective and remaining work; and (4) the cost to achieve systems completion.

We prepared expert reports and cost estimates and provided deposition testimony, which assisted the parties in resolving the dispute before trial.