12 February 2020
20137096-009 Rev A
project definition for a class 4 estimate ranges from 1% to 15% and is based on preliminary concept quantities. 10.1 Project execution basis and scope The cost estimate is based on the premise that experienced contractors will be appointed to execute all construction activities. Construction contracts and supply orders will be awarded to the contractor, possibly following a competitive bid.
The contracting and procurement plan for the project are as follows:
The contracting strategy is to engage experienced contractor to carry out the construction activities for the project.
The contractor will be selected based on their capabilities, availabilities, competitive pricing, previous project histories etc.
The procurement strategy is to prepare tender documents and obtain quotes from preferred and other suitably experienced contractors. Evaluations will be carried out based on their pricing, delivery etc.
The Capital cost estimate includes costs for the following items:
Site preliminaries including mobilisation, demobilisation, clearing and grubbing, removal of underground services (if any)
Excavation of tailings, stockpiles and borrow materials
Excavation of catchment drains
Bulk earthworks activities relating to the construction of the TSF embankments
Engineering design
Contractor distributables
Project management including construction management services
Contingency
Owner’s project management or other owner’s cost
Engineering Service Provider (ESP) costs:
▪ ESP costs have been included in the cost estimate at a rate of 10% of the direct costs. This cost represents engineering and design work that may need to occur.
Given the low definition of design, quantities and specifications the costs for this estimate were primarily prepared from factored and priced quantities, where possible, and priced parameter quantities, all obtained from similar projects that were available to Golder.
10.2 Estimate contingency
Contingency is a cost element of the estimate used to cover the uncertainty and variability within a cost estimate, and for unforeseeable elements of cost within the defined project scope.
Based on the level of project definition and the potential for changes due to unforeseen conditions including the variability and level of information available for each option, Golder recommends applying a contingency of 30% to the overall project value to cover any project unknowns.
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