Sydney Water adopts NEC4 for ProMac water supply upgrade project in Australia

Sydney Water and its delivery partner Acciona are using NEC4 contracts to procure the ‘ProMac’ water supply upgrade project between Prospect Reservoir in Greater Western Sydney and the Macarthur region in New South Wales. 

Through its partnership with Acciona, Sydney Water has engaged tier 2 and tier 3 contractors under the NEC4 Engineering and Construction Contract (ECC) Option A (priced contract with activity schedule) to deliver the 20 work packages that make up the approximately AU$280 million (£150 million) scheme.

ProMac involves upgrading Sydney Water’s existing water reservoirs at Liverpool, Cecil Park and Currans Hill as well as building two new reservoirs at Oran Park. This will provide an extra 100 Ml of additional reservoir capacity in western Sydney, equivalent to about 50 Olympic-sized swimming pools.

The project also includes 15 km of additional pipework, three pumping stations and upgrading the existing network to ensure growing communities in southwestern Sydney have access to clean drinking water. Works commenced in 2021 and are due for completion in 2025.

Mutual trust and cooperation

NEC4 contracts have now been adopted for Sydney Water’s major projects, with ProMac being the pilot project. The contract approach encourages parties to act in a ‘spirit of mutual trust and co-operation’, stimulating good management of relationships within the project. 

NEC-inspired collaboration has resulted in all parties working as a team, replacing independence with interdependence, competition with cooperation, and blame with joint problem solving. Collaboration between the parties, with a ‘sort it now’ approach, has also helped to resolve complex challenges quickly, ensuring outcomes are best for the project. 

Enhanced risk management

The NEC contract mechanisms have aided the team in managing inherent risks on the project. The early warning process has required the parties to work closely to identify, monitor and manage risk events in the best interest of all stakeholders. It has enabled the project manager to deal expeditiously with any contractor’s risks that could impact on cost, time or quality.

The NEC requirement on the contractors to execute the work based on an up-to-date programme is also benefitting the project. It provides better visibility into all aspects of the programme including real-time progress, significant milestones, sequencing, resequencing and time-risk allowances. This has also made it much easier to resolve time-related compensation events compared to traditional contracts.

ProMac is part of Sydney Water’s investment in new infrastructure that will support the growing, dynamic southwestern Sydney. The project will help Sydney Water deliver on its vision of creating a better life with world-class water services.

Benefits of using NEC

• NEC obligation to act in a ‘spirit of mutual trust and co-operation’ has encouraged the client, delivery partner and contractors to develop collaborative solutions.
• NEC early warning process has ensured that any risks to cost, time or quality are quickly identified, monitored and managed. 
• NEC-inspired collaboration means that compensation events are readily agreed without negatively impacting progress.
• NEC requirement to continually update the programme has provided better visibility on progress and facilitates agreement of time-related compensation events.