Asset Management Excellence: Mastering Operations and Maintenance Model Parameters

Part 1 – Project Modeling Versus Asset Management

Asset Management transcends modeling expertise
Tangible profitability value of drilling down into O&M model entries
Lofty model expectations, like continuous cash flow, often derailed by O&M realities

Part 2 – Asset Manager's Role in O&M Contractor Selection

Part 3 – Critical Selection of O&M Organization

Part 4 – Personal Liability of Asset Manager

Part 5 – Successful Negotiation of O&M Contracts

Asset Managers role in O&M contract negotiations
Understanding local requirements where asset is located
Implications of workers' union
Structuring effective exit position for equity and debt interests
Determining optimal payment structure (cost plus, fixed fee, fixed price, hybrid)
Taking negotiation advantage of differing Banking and Contractor perspectives
Structuring Effective Performance Guarantee and Bonus Schemes
Ensuring Responsibilities and Accountabilities are clearly defined
Recognizing and countering O&M Contractor gamesmanship
Right pricing long term O&M agreements even when historical data is scarce

Part 6 – Understanding Key O&M Contract Provisions

Ultimate liability for planned and unplanned maintenance from different perspectives
Proper allocation of inflation, currency and lost profits risk among the players
Yielding concessions for limiting contractor's consequential damage liability
Structuring equitable payment and payment guarantee terms
Promoting minimum guarantees for production
Clearly defining terms used in O&M and related contracts (e.g. PPA and O&M)
Appropriate utilization of insurance to limit project O&M liability

Part 7 – Recognizing Embedded Cash Flow Risks in Commissioning-to-Operations Hand-off

Establishing and managing construction deficiency list
Using due diligence checklist to manage transition from construction to operation
Understanding from shareholder standpoint the overlap between operation and construction phases
Establishing contractual test protocol for civil, mechanical and electrical completion
Ensuring compliance with local and country regulations
Determining who is in charge of hand-off and who should be
Understanding the natural conflict between revenue generation and project completion from equity and debt perspectives
Anticipating confusion over Warranty coverage, management and disruption of project
Handling the inevitable tension between diverse contracting entities and cash flow concerns

Part 8 – Ingredients of a Well Managed O&M Program

Preparing Operating Plans and Budget Implementation
What Asset Managers should look for when walking around (focus on safety, environmental management system, strategic spares, proper logs, attitude, housekeeping, tools, visual systems)
Owners should garner working leaders with an attitude of continuous improvement
Understanding the impact to the owner's objectives (with reward and recognition)
How to mandate effective policies and procedures coupled with training
Employ functional CMMS (Computer Maintenance Management System)
Establish key performance indicators (KPIs)
The value of good Fuel management and Plant Chemistry
The critical importance of Documentation

Part 9 – Importance of O&M Reporting

O&M reports the Asset Manager should demand
Informed monitoring of project performance, administrative, safety, environmental and security issues by Asset Manager
Variance trends that should raise "red flags" with debt and equity interests
Maintaining strict vigilance over unplanned maintenance and extraordinary expenses
Audits, statutory reports and Continuous Improvement are windows on project vitality for Asset Managers

Part 10 – When Acts of God and Others Interfere With Project Cash Flows and Shareholder Profits

Appreciation for the legal concept of Force Majeure and what is included
Application and negotiation of Force Majeure principles from varying perspectives
Who bears the risk of Force Majeure Event and who should?
Critical importance of business interruption insurance to shareholders

Part 12 – Why Projects Fail to Operate Correctly

Part 12 – Protecting Cash Flow During Operational Failures

Part 13 – Smart Resolution of Business Disputes

Part 14 – Avoiding Foreign Corrupt Practices

Part 15 – When Shareholders Should Change O&M Contractors

Part 16 – Optimizing O&M Asset Management

Maintain visible project presence
Make O&M contract work for equity interests
Understand and use the differing motivational interests of owners, bankers and contractors
Treat the project model as "living" O&M tool

Available Dates

TESTIMONIALS

"The Vair course was outstanding on every level."

- World Bank/IFC Advisor