Research on Subcontractor Risk of EPC Hydropower Project in Vietnam

Abstract

Engineering, procurement and construction (EPC) contracts are becoming the most popular form to undertake construction works on large-scale hydropower projects. The EPC general contractors in Vietnam have been coped with lots of difficulties during the construction phase of hydropower projects, resulting in significant schedule delays and cost overrun. One of the reasons is poor Subcontractors capacity. In order to overcome above, the current study attempts to research on identification and control Subcontractors risks of delay process of EPC hydropower project in Vietnam. Through summarizing international research achievements of previous researches relating on EPC hydropower projects combining with analysis characteristics of developing construction of EPC hydropower projects in Vietnam, the current study pointed out all kinds of subcontractor risk of delay process of EPC hydropower project in Vietnam; a questionnaire with 18 risk elements was designed and then delivered to experts in EPC hydropower project management area. Based on the risk model, 11 main risk elements were identified which can be categorized into 3 groups. Lastly, the current study proposed suggestions to reduce or avoid risks as well as approach to control risks. Furthermore, the findings of this study can be a good managerial reference for project management teams who are working in other countries that have similar economic and investment environment to Vietnam to get their EPC construction project completed on schedule, thus ensuring the benefits to the government, the investor, the contractor, and the parties involved.