Risk Allocation in DBFM Projects

Providing Practical Guidance in the Risk Allocation Process of DBFM Projects

Master thesis (2019)

Authors

T.H.B. Damen Civil Engineering & Geosciences

Contributors

M.J.C.M. Hertogh Integral Design & Management - CEG (supervisor 1)
L.P.I.M. Hombergen Integral Design & Management - CEG (supervisor 1)
M. Leijten Organisation & Governance - TPM (supervisor 1)
Florens Kneepkens (supervisor 1)
Faculty
Civil Engineering & Geosciences
Copyright: © 2019 Tom Damen
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Published Date

12-07-2019

Language

English

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Faculty

Civil Engineering & Geosciences

Abstract

The risk allocation in DBFM projects is currently a hot topic, whereby multiple contractors have withdrawn from the procurement of these projects. This research provides a practical guidance in the risk allocation process of DBFM projects, consisting of design principles of literature and lessons learned from practice. The design principles that should be taken into account are: The party has the best capability to control the events that might trigger the risk; The party has the capacity and expertise to control, monitor and minimize these risks; The party has identified, understood and evaluated the risk; The party has the resources to deal with the risk if it fires; The party accepting the risk can charge the right premium for this risk; The party has the right risk attitude and wants to accept the risk. The lessons that can be learned from practice are to use the insights of similar projects, to have a proper allocation of data inadequacies, to have an open discussion on the risk allocation in the procurement and to focus on collaboration. Besides the practical guidance, this research has provided an assessment framework in order to see if it is (un)favourable to use the DBFM contract. The assessment framework is based on three characteristics, namely the involvement of only one discipline, the budget between the €60 million and €500 million and the stable scope over time.