What does an EPC contractor do?

Engineering, procurement and construction of the complete facility at a fixed price and date

Operates the facility for 20 years

Contractor designs, builds, tests and hands over a ready-to-use project at a lump sum

Client builds and contractor supervises

What is the difference between BOO and BTO?

BOO: private owns permanently; BTO: ownership transferred to government right after completion, then private operates

BOO transfers ownership at once; BTO never transfers

Which is a PPR method of execution?

Sealed quotation for small value works

2079 Jestha · 2+4 marks

Methods of execution guided by PPR

Short answer

PPR methods include open bidding, pre-qualification, sealed quotation, direct purchase, user's committee, force account, and special contracts. EPC: single contractor designs, procures, builds (e.g., hydropower). Turnkey: ready-to-use facility. BOO: build-own-operate without transfer. BTO: build-transfer-operate.

Enlist different methods of execution of work guided by PPR. Explain with suitable examples: EPC contract, Turn key contract, BOO contract and BTO contract.

Methods of execution of work guided by the Public Procurement Act (PPA) 2063 and Rules (PPR) 2064

Open competitive bidding: national (NCB) and international (ICB)
Pre-qualification followed by bidding
Two-stage or two-envelope bidding
Sealed quotation (for small value)
Direct purchase (very low value or single source)
Works by user's committee / community participation (consumer groups)
Force account / departmental (amanat) work
Special contracts: turnkey, EPC, design-build, BOO, BOOT, BTO, and joint venture

EPC contract

Engineering, Procurement and Construction. A single contractor designs (engineering), procures the equipment and materials, and builds the project, delivering a complete working facility at a fixed price and date. Example: a hydropower plant or a substation where the EPC contractor delivers the whole plant including the electro-mechanical equipment. The risk of design and cost is on the contractor.

Turnkey contract

The contractor is responsible for everything from the design to construction, testing and commissioning, and hands over a ready-to-use project ("turn the key") at a lump sum price. Example: a hospital building constructed and equipped by one firm.

BOO contract (Build-Own-Operate)

A private company builds, owns, and operates the facility permanently, selling its services or output (for example, power to the NEA under a PPA). There is no transfer of ownership to the government. Example: a private independent power producer.

BTO contract (Build-Transfer-Operate)

The private party builds the facility, transfers ownership to the government immediately after completion, and then operates it for a fixed period to recover its investment through the fees. Example: a toll bridge or a water supply scheme that the developer operates for 20 years under the agreement.

✓ Answer checked by Claude Opus 5.5 (high effort)

Turn-key contract · Construction Management, chapter 5

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