NEC has been successfully adopted to deliver the first sections of new automated-people-mover (APM) and baggage-handling-system (BHS) tunnels on the airport island of the Hong Kong International airport as part of its HK$141.5 billion (£13 billion) Three-Runway System (3RS) project.
Airport Authority Hong Kong (AA) awarded the HK$2.4 billion (£220 million) civil works contract to China State Construction Engineering (Hong Kong) Limited under an NEC3 Engineering and Construction Contract (ECC) Option D (target contract with bill of quantities) in June 2017. It was also the first NEC contract to be let on the 3RS project.
The works involved building the first 400 m sections of a 2.6 km long APM tunnel and adjacent BHS tunnel at the eastern end of the existing airport island. When 3RS is completed in 2024, the tunnels will link the expanded Terminal 2 to its new concourse being built on 650 ha of reclaimed land north of the airport. The new APM system will operate at a top speed of 80 km/h and transport up to 10,800 passengers per hour, while the new BHS will be capable of handling up to 9600 bags per hour.
The APM tunnel is a four-cell reinforced concrete box structure while the parallel BHS tunnel is a two-cell design. The first sections delivered under the contract were mostly built in a heavily braced open-cut excavation that crossed beneath the dual-carriageway Airport Road and four single-carriageway roads. Where the tunnels cross under the MTR Airport Express railway line, they are being installed by box-jacking using an NEC3 Engineering and Construction Subcontract (ECS).
The early success let to NEC4 ECC Option D being adopted for other larger contracts on the 3RS project, including the contract for the new 3.8 km long third runway and associated works, and the contract for the sections of the APM and BHS tunnels on newly reclaimed land.
Collaborative working environment
Joe Sam, AA senior projects manager, says ECC Option D was chosen for its collaborative working environment, proactive risk management and pain/gain share mechanism. ‘The NEC obligation to work in a, “spirit of mutual trust and co-operation,” fostered a collaborative working environment between the employer and contractor by providing procedures and systems that encouraged partnering and brought mutual benefits. The culture of partnering facilitated effective communication between the parties, in which information was actively shared and discussions on critical concerns encouraged for the benefit of the project.’
He also says NEC promoted a proactive approach in managing project risks, especially in relation to tunneling works underneath the MTR Airport Express railway line. ‘While the mutual trust cultivated in NEC facilitates the communications between both parties on project risks, the unique early warning system in NEC further consolidated the approach of early risk identification and mitigation.’
Sam says both the project manager and contractor actively identified and jointly discussed potential risks on a regular basis. ‘Risk reduction and/or mitigation opportunities in various aspects such as logistics, engineering and design could be brought forward, discussed and implemented at an earlier stage than under a traditional contract. Any disruption of works, project overrun, cost exceedance or disputes due to potential risks were therefore avoided or reduced.’
He says a further benefit of ECC Option D is the pain/gain share mechanism. ‘This incentivised savings and distributed risks of over-spend for both the employer and contractor. It achieved mutual benefits for both parties by encouraging cost control while sharing project risks between them at the same time. The mechanism also encouraged the contractor to engage in early dialogue with the project manager on innovative engineering solutions to reduce construction risks and costs.’
Openness and teamwork
According to Sam, the NEC-inspired openness and teamwork between the employer and contractor was deeply rooted at every interactive level of the project, from sharing the same office building for ease of communication to actively hosting meetings to discuss particular concerns.
‘To further enhance the trusting environment, workshops focused on partnering and team-building leisure activities were regularly organised. This resulted in a harmonious working relationship, allowing discussions to be conducted openly on the basis of fairness, cooperation and transparency.’
He adds that the NEC-inspired environment also helped the project team to win recognition by external professional bodies, such as being named the NEC Contractor of the Year by the Institution of Civil Engineers and Champion in the Contractors Safety Project Team Award organised by Lighthouse Club Hong Kong.
Sam says the NEC requirement to act, ‘as stated in this contract,’ has also led to efficient management of risks and changes. ‘Active involvement in the risk reduction process by the employer and contractor was fully reflected in the early warning system, with 90% of the 264 early warnings proactively raised by both parties successfully resolved, without affecting the programme or costs.’
A notable example was the early identification of ground conditions in the box-jacking area. ‘Based on the conditions found in an adjacent area and existing ground information, the contractor was notified at an early stage that a large boulder or rockhead might be encountered during the box-jacking works. As a result, the contractor made early preparations for the potential ground conditions and assigned appropriate resources to ensure the target production rate could be achieved.’
In addition to early warnings, Sam says changes initiated by the contractor for the benefit of the project were also positively received. ‘The contractor put forward four value-engineering proposals, all of which were discussed and accepted by the employer to reduce construction risk, programme risk and cost. These value-engineering proposals helped save construction cost and contributed to the timely completion for the majority of related works.’
Benefits of using NEC
- NEC obligation to work in a, ‘spirit of mutual trust and co-operation’ fostered a collaborative working relationship between the parties.
- NEC early warning and contract management processes ensured the parties took a proactive approach to managing risk from the outset.
- NEC-inspired collaboration engendered innovation and opportunities in logistics, engineering and design for the benefit of the project.
- ECC Option D pain/gain share mechanism encouraged both parties to control costs through sharing the risk of over- or under-spend.