Power Island

SEMBCORP FICHTNER

Volume 1The Contract and Schedules to the Contract

SEMBCORP UTILITIES TEESSIDE FICHTNER

Volume 1, Part 1

739-V1-P1 Agreement.doc

Printed on 23 March 2004

ISSUE NUMBER 1

DATE 19/12/03

AUTHOR PME

CHECKED RJH

739-V1-P1 Agreement.doc Contract Agreement

SEMBCORP UTILITIES TEESIDE

WILTON 10 BIOMASS POWER PLANT

CONTRACT AGREEMENT


739-v1-p1 agreement.doc, 23/03/04 Contract Agreement Volume 1, Part 1 , Page i

RECORD OF CHANGES

1 Original Version 19/12/03


739-v1-p1 agreement.doc, 23/03/04 Contract Agreement Volume 1, Part 1 , Page 1

Agreement

THIS AGREEMENT is made the .......................... day of..................... 200 ...........................................

between

Sembcorp Utilities Teesside Limited a company incorporated in England and Wales under number4636301 and whose registered office is at SembCorp Utilities Teesside Headquarters, WiltonInternational, Middlesbrough, TS90 8WS (hereinafter referred to as SembCorp); and ...............

(hereinafter called `the Purchaser') of the one part

and

[Contractor] ........................................................................................................................................

............................................................................................................................................................

of.........................................................................................................................................................

............................................................................................................................................................

............................................................................................................................................................

............................................................................................................................................................

(hereinafter called `the Contractor') of the other part.

WHEREAS

I. The Purchaser wishes to have a process plant to be known as the Wilton 10 biomass powerplant constructed at the Purchasers Wilton Site at Teesside and wishes the Contractor to carry out andcomplete the Works as defined in the Contract and the Contractor is willing and able to carry out andcomplete the Works in accordance with the Contract

THIS AGREEMENT provides as follows:

1. The following documents and their attachments (if any), shall together constitute the Contractbetween the Purchaser and the Contractor and the term `Contract' shall in all such documents beconstrued accordingly.

(a) This Agreement.

(b) The Special Conditions

(c) The General Conditions of Contract being clauses 1-48 as set out in the IChemE Form ofContract for Lump Sum Contracts, 4th Edition 2001 and amendments thereto

(d) The Schedules:

Schedule 1: Description of Works;

Schedule 2: Documentation



Schedule 3 Responsibilities of the Purchaser;

Schedule 4: Health and Safety

Schedule 5: Environmental protection and waste disposal

Schedule 6: Quality assurance and validation

Schedule 7: Sub-contracting

Schedule 8: Contractors named personnel

Schedule 9: Training by the Contractor

Schedule 10: Parts with limited working life

Schedule 11: Times of Completion

Schedule 12: Liquidated damages for delay

Schedule 13: Pre-installation tests and procedures

Schedule 14: Criteria for the completion of construction

Schedule 15 Take-over procedures

Schedule 16 Performance tests and procedures

Schedule 17 Performance Guarantees and damages for failure

Schedule 18 Valuation of variations and claims

Schedule 19 Terms of payment.

Schedule 20 Agreed form of Company Bond

Schedule 21 Agreed form of Performance Bond

Schedule 22 Agreed form of Retention Bond

Schedule 23 Agreed Deviations from Specification

(e) The Specification

(f) The Contractors Technical Submission and Proposals.

For the purpose of identification the contents of the Contract, including the number of pages ineach part, are listed in the Annex to this Agreement attached hereto.

2 The Contract constitutes the entire agreement between the Purchaser and the Contractor withrespect to the performance of the Works and supersedes all prior negotiations, representationsor agreements relating thereto. No changes, alterations or modifications to the Contract shallbe effective unless the same shall be in writing and signed by both parties.

3. The Contract Price is the sum of .......................................................................................

( ............................................................................................................................................ )

4. The Contractor's liability in respect of:

(a) Loss of or damage to property of the Purchaser and his Affiliates in accordance withSub-clause 30.7 of the General Conditions of Contract shall not exceed

(c) The total Cost of making good defects in the Plant referred to in Sub-clause 37.12 of theGeneral Conditions of Contract shall not exceed ..............................................................



5 In case of conflict between any of the documents accompanying this Agreement, the order ofprecedence shall be as set forth in Clause 2 of the General Conditions.

6. For the purposes of Sub-clauses 6.3, 7.3, 8.3 and 28.3 of the General Conditions the date ofthe Contractor's tender shall be the ........................... 19 ...............................

7. The date for the commencement of the Works shall be ......................................................

8. The Purchaser hereby appoints ............................................................................................

................................................................................................................................................

to act as the Project Manager for the purposes of the Contract.

9. The Contractor hereby appoints............................................................................................

................................................................................................................................................

.............................................. to act as Contract Manager for the purposes of the Contract.

10 The bank whose base lending rate is referred to in clause 1 of the General Conditions is

11 Wherever profit is expressly referred to in the General conditions it shall be [ ]% of theapplicable cost.

12 The location of any arbitration proceedings under clause 48 shall be [ ]

IN WITNESS whereof the parties hereto have signed this Agreement on the date first above written.

For and on behalf of the Purchaser

Signature:

Name:

Title:

For and on behalf of the Contractor

Signature:

Name:

Title:



ANNEX A LISTING OF THE DOCUMEN TS COMPRISING THE CONTRACT.

To be completed before Contract Award.


Volume 1, Part 2

739-V1-P2 Special Conditions.doc


ISSUE NUMBER DRAFT 1 2 3 4

DATE 19/12/03 9/02/04

AUTHOR PME PME `

CHECKED JW JW

7 3 9 - V 1 - P 2 S p e c i a l C o n d i t i o n s . d o c

SPECIAL CONDITIONS OFCONTRACT


739-v1-p2 special condit ions.doc i

TABLE OF CONTENTS

1. SPECIAL CONDITIONS TO THE MODEL FORM OF CONTRACT........................................... 1Clause 1 Definition of terms ...................................................................................................................... 1Clause 2 - Interpretation ................................................................................................................................ 5Clause 3- Contractors responsibilities ......................................................................................................... 5Clause 4- Purchasers responsibilities........................................................................................................... 7Clause 6 Sufficiency of Contract Price ...................................................................................................... 7Clause 7 Statutory and other obligations.................................................................................................... 8Clause 10 Nominated Subcontractors ........................................................................................................ 9Clause 11 The Project Manager ................................................................................................................. 9Clause 15 - Damages for Delay................................................................................................................... 10Clause 17 Contractors Variations ........................................................................................................... 10Clause 18 Contractors claims.................................................................................................................. 10Clause 19 Valuation of Variations and claims ......................................................................................... 10Clause 21 - Documentation ......................................................................................................................... 11Clause 22 Inspection and pre-installation tests ........................................................................................ 11Clause 25 Ownership of Materials ........................................................................................................... 12Clause 26 Health, Safety and Environment.............................................................................................. 13Clause 29 Meetings ................................................................................................................................... 13Clause 31 Insurance.................................................................................................................................. 13Clause 32 Completion of construction ...................................................................................................... 13Clause 33 Taking over.............................................................................................................................. 14Clause 34 Site clearance........................................................................................................................... 15Clause 35 Performance Tests ................................................................................................................... 15Clause 36 Acceptance .............................................................................................................................. 16Clause 37 Liability for Defects ................................................................................................................ 17Clause 38 Final Certificate....................................................................................................................... 17Clause 39 - Payment .................................................................................................................................... 18Renumber existing Sub-clauses 39.10, 39.11 and 39.12 as 39.13, 39.14 and 39.15 respectively. ............. 19Clause 40 - Provisional and prime cost sums.............................................................................................. 19Clause 43 Termination for Contractors default ...................................................................................... 20Clause 49 - Communications....................................................................................................................... 20


739-v1-p2 special condit ions.doc Page 1

1. SPECIAL CONDITIONS TO THE MODEL FORM OF CONTRACT

The General Conditions of Contract being clauses 1-48 as set out in the IChemE Form of Contractfor Lump Sum Contracts, 4th Edition 2001 and amendments thereto (Red Book) shall bemodified as follows.

Clause 1 Definition of terms

The following definitions shall be inserted or, where the term is already defined in Clause 1 ofthe Red Book, shall be substituted for such definition.

Absolute Performance Levels means the levels of performance that the Plant must achieveas set out in paragraph 17.1 of Schedule 17.

Agreement means the agreement between the Purchaser and the Contractor dated [ ]which is bound with these Conditions of Contract.

Available means (in respect of the Plant or the relevant part thereof) that the Plant (or therelevant part thereof) is capable of operating at its Maximum Continuous Rating andAvailability shall be construed accordingly.

Availability Period means the period of 12 months commencing on the date of issue of thePerformance Test Completion Certificate.

Availability Test means the test of the Availability of the Plant during the Availability TestPeriod, as described in the Contract and in accordance with Schedule 16 of the Contract.

CDM Regulations means the Construction (Design and Management) Regulations 1994.

Company Guarantee means the guarantee to be provided in favour of the Purchaser by[Company Name] guaranteeing the obligations of the Contractor hereunder in accordance withClause 3 which shall be in the form set out in schedule 20.

Construction Completion Report means a report to be provided by the Contractor to thePurchaser pursuant to Clause 32.2.

Consumables means power, demin water, lube oil.

Contractors Collateral Warranty means the deed or deeds of collateral warranty to beprovided by the Contractor in accordance with clause 9.7 which shall be in the form set out inschedule [ ].

Contractors Technical Submission and Proposals means the technical submissions andproposals dated [insert date of tender] (Volumes [insert number of volumes] and entitled [inserttitle of tender]).

Defects Liability Period shall have the meaning given to it in Sub-clause 37.2 and willinclude any extension to such period in accordance with Sub-clause 37.10.

Economic Performance Levels means the performance levels set out in paragraph 17.2 ofSchedule 17.

The Directive means The Directive 2000/76/EC of the European Parliament and of theCouncil of 4 December 2000 on the Incineration of Waste.

Design Life has the meaning given to it in the Specification Volume2 Part 9.

Effective Date means the date of the Agreement.

FGT means flue gas treatment.

Final Date for Payment means the final date on which a payment is due from the Purchaseragainst an invoice submitted by the Contractor in accordance with Clause 39.



Good Industry Practice means the exercise of that degree of skill, care, diligence, prudenceand foresight which would reasonably and ordinarily be expected from a skilled andexperienced person engaged in the provision and operation of equivalent works and services tothose required by the Contract acting in accordance with all applicable Legislation and applyingthe standards generally adopted by persons providing such equivalent works and servicesapplicable to biomass fired power plant, throughout the European Union and in particular in theUnited Kingdom.

Guaranteed Availability means the levels of Availability that are guaranteed by theContractor and are set out in paragraph 17.4 of Schedule 17.

Health and Safety File means the file to be prepared by the Contractor under thesupervision of the Planning Supervisor in accordance with the CDM Regulations.

Initial Availability Period means the period of 3 months commencing on the date of issueof the Take-Over Certificate.

Interim Certificate means a certificate issued by the Project Manager pursuant to Clause39.3.

Latent Defect means any defect in the Works which becomes apparent during the LatentDefects Liability Period but excluding any defect resulting from:

a) fair wear and tear; or

b) failure by the Purchaser to operate the Plant in accordance with prudent operatingand maintenance practices; or

c) modifications made to the Plant without the Contractors prior written approval.

Latent Defects Liability Period means the period of six years from the date of Acceptancein relation to any Latent Defect appearing in any part of the Works:

Legislation means:

1) The Directive; and

2) any other law, regulation, ordinance, order, notification, instruction, bye-law, guideline,code or standard (including legislation regulating, relating to or imposing liability orstandards of conduct concerning environmental matters) in relation to Works and theplant supplied as part of the Works enacted, in force or having the force of law in theUnited Kingdom at any time during the period of the Agreement; and

3) any codes of practice, Acts of Parliament and other legislative instruments, regulationsand standards which would be observed by an experienced, reasonable and competentcontractor and which are enacted, made or published at any time during the period ofthe Agreement;

4) any condition in relation to the Plant supplied as part of the Works imposed pursuant tothe consent for the construction of the Plant supplied as part of the Works or theauthorisation issued by the Environment Agency pursuant to the Pollution Preventionand Control Act 1999 and the Pollution Prevention and Control (England and Wales)Regulations 2000 SI 2000/1973.

5) any conditions or requirements imposed by any other consent, permission, approval orlicence which the Contractor is required to obtain pursuant to the Contract or which isobtained by the Purchaser with respect to the Works and a copy of which thePurchaser has provided to the Contractor.



Liquidated Damages means those liquidated and ascertained damages payable by theContractor to the Purchaser in accordance with the Contract which are an agreed genuine pre-estimate of the losses to the Purchaser deriving from the Contractor's defaults as specified in theContract and, save as otherwise stated in the Contract (including (without limitation) anyexpress right to terminate for material breach), Liquidated Damages shall be in full and finalsatisfaction of the Contractor's liability for delay or for failure to meet the GuaranteedAvailability or for failure to meet the Economic Performance Levels (as the case may be).

Maximum Continuous Rating is as set out in Section 2.3 of the Annex to Schedule 1 andMCR has the same meaning.

Milestone Event means one of the events listed as such in Schedule 11.

Milestone Payment means the payment due to the Contractor for achieving a MilestoneEvent as set out in Schedule 19.

Milestone Payment Dates means the dates calculated by reference to the periods shown inSchedule 19 or as the same may be adjusted in accordance with the Contract.

Moodys means Moodys Investors Services, Inc. of 99 Church Street, New York, NY10007, USA and its successors.

Operability Test means the demonstration by the Contractor described in the Contract (and,in particular, Schedule 15), to be carried out by the Contractor as part of the Take-Over Tests,prior to Taking Over.

Operating and Maintenance Manuals means the manuals containing the instructions forthe operation and maintenance of the Plant provided to the Purchaser by the Contractor inaccordance with the Contract.

Performance Bond means the performance bond to be procured by the Contractor inaccordance with Clause 3.10 which shall be: in the sum of [ ]; from a major commercial bankor financial institution having a credit rating equal to or greater than A+ by S&P or A1 byMoodys; and in the form set out in schedule 21.

Performance Indicators means the items identified as such in Schedule 17.

Performance Tests means the performance tests specified in Schedule 16.

Performance Test Completion Certificate means the certificate to be issued pursuant toSub-clause 35.17.

Performance Test Period means the period of 3 months commencing on the completion ofthe Initial Availability Period.

Planning Supervisor has the meaning given to it in the CDM Regulations and shall be theperson appointed by the Purchaser (and notified to the Contractor) in accordance with suchRegulations.

Plant means the plant and equipment described in the Contract to be supplied by theContractor as part of the Works.

Preliminary Tests means

1) all the test and commissioning procedures including off-site tests to be carried out by theContractor prior to operation of the Plant, in accordance with the Contract and/oraccepted international and national standards in order to ensure that the Plant iscomplete and safe to operate and compliant with the Contract which procedure shallalso be referred to as "Cold Commissioning"; and (thereafter)

2) such other tests to be carried out by the Contractor including setting of all control valuesand parameters, tuning of all control loops; and



3) all other tasks to be carried out by the Contractor necessary to ensure that the Plant isready for the performance of the Operability Test

All as more particularly described in the Contract.

Prolonged Delay means a delay in completion of the Works where the Purchaser hasbecome entitled to the maximum amount of Liquidated Damages for Delay pursuant to Clause15.

Quality Assurance Scheme means the quality assurance scheme to be submitted by theContractor as described in Schedule 6, compliant with IS0 9000 (or such other equivalentinternational standard) as approved by the Purchaser.

Rejection Levels means the minimum levels of performance which are guaranteed by theContractor as set out in Schedule 17.

Retention Bond means the retention bond to be procured by the Contractor in accordancewith Clause 3.11 which shall be: in such sum as is equal to [ ] percent of the Contract Price;from a major commercial bank or financial institution having a credit rating equal to or greaterthan A+ by S&P or A1 by Moodys; and in the form set out in schedule 21.

S&P means Standard & Poors Ratings Group (a division of McGraw Hill Inc.) of 25Broadway, New York, NY 10004, USA and its successors.

Site Instruction means any written instruction issued by the Project Manager except forVariation Orders.

Sub-Contractors means those domestic sub-contractors of the Contractor providing thefollowing elements of the Works: [list]

Sub-Contractors Collateral Warranty means the deed or deeds of Collateral Warranty tobe provided by the Sub-Contractors in accordance with clause 9.5 in the form set out inschedule [ ].

Take-Over Date means the date stated in any Take-Over Certificate as being the date uponwhich the Take-Over Tests in relation to the section of Works referred to in such Take-OverCertificate have been successfully completed in accordance with the Contract and TakeOver and Taking Over shall be construed accordingly.

Take-Over Tests means the tests to be carried out prior to Taking Over, more particularlydescribed in the Contract and in particular in Schedule 15.

Tests means:

1) the Preliminary Tests including off-site tests;

2) the Take-Over Tests;

3) the Performance Tests;

4) the Availability Test; and

5) all other tests required in accordance with the Contract or which are otherwise requiredin accordance with Good Industry Practice applicable to biomass fired power plant.

and any and all of them, as the context so requires and Test shall be construed accordingly.

Test Protocol means the detailed description of the Tests, prepared by the Contractor asrequired in the Contract, and Draft Test Protocol and Final Test Protocol shall beconstrued accordingly.

Time for Completion means the period of time for completion of the Works or any Sectionthereof as stated in the Contract or as extended under Sub-Clause 14.1.



Variation means any alteration in the Plant, method of working, programme of work or tothe type or extent of the Plant which is an amendment, omission, addition or substitutionthereto (other than an amendment, omission, addition or substitution which is necessary for thePlant and/or the Works to comply with the Contract) not being a minor change in detail, adesign development required to comply with the Contract or any immaterial alteration in themanner in which the Works are to be carried out.

Variation Order means any instruction issued by the Project Manager instructing aVariation and/or making an adjustment to the Contract Price and/or the Approved Programme.

Works means:

1) the design, manufacture, delivery to Site, construction, execution, and completion of thePlant required under the Contract; and

2) the provision of all work and services, whether specifically mentioned in the Contract ornot, and which would reasonably be inferred by a reasonable and competent contractorexperienced in projects such as the Plant as being required for the proper executionthereof to be provided by the Contractor including, but not limited to, the provision andconstruction of the Plant and any temporary works, and any other work to be carried outby the Contractor in accordance with the Contract and Good Industry Practice.

Clause 2 - Interpretation

Modify Clause 2.2:

2.2 In lines 4 to 8, replace the existing (a) to (e) with:

(a) The Agreement;

(b) The Special Conditions;

(c) The General Conditions of Contract being clauses 1-48 as set out in the IChemE Form ofContract for Lump Sum Contracts, 4th Edition 2001 and amendments thereto;

(d) The Schedules;

(e) The Specification;

(f) The Contractors Technical Submission and Proposals.

Add new Clause 2.8:

2.8 In the Contract any reference to a statute or statutory provision shall be construed as a referenceto the same as may have been, or may from time to time be, consolidated, amended, modified orre-enacted.

Clause 3- Contractors responsibilities

Modify Clause 3.8:

3.8 Add to the end of the Sub-clause: The Contractor shall be responsible for demonstrating to theProject Manager that all parts of the Works are being carried out in accordance with thisSchedule. Where the Project Manager decides that the Works are not being carried out in anadequate manner and that this is likely to cause a serious reduction in the quality of the Works,the Project Manager may give notice to that effect to the Contractor. Following such notice theContractor shall use his best endeavours to remedy the position at his own cost.

Add new Clause 3.10:



3.10 The Contractor shall provide at its own expense the Performance Bond within 21 days of theEffective Date and shall ensure that the Performance Bond remains in full force and effect untilsuch time as Acceptance has occurred and the Retention Bond has been provided in accordancewith Clause 3.11 below. Failure to provide and maintain the Performance Bond in accordancewith this Clause 3.10 shall constitute a material breach of the Contract. The Purchaser shall beentitled to withhold a sum equivalent to the value of the Performance Bond from the ContractPrice unless and until the Performance Bond is provided by the Contractor.


3.11 The Contractor shall provide at its own expense the Retention Bond on or before the date onwhich Acceptance occurs and shall ensure that the Retention Bond remains in full force andeffect until the Final Certificate(s) covering the whole of the Plant and the Works have beenissued in accordance with Clause 38. Failure to provide and maintain the Retention Bond inaccordance with this Clause 3.11 shall constitute a material breach of the Contract. ThePurchaser shall be entitled to withhold a sum equivalent to the value of the Retention Bondfrom the Contract Price until the Retention Bond is provided by the Contractor.

Add new clause 3.12:

3.12 If at any time before expiry of the Performance Bond or the Retention Bond (as the case maybe) the provider of such bond ceases to have a credit rating of equal to or greater than A+ (asrated by S&P) or A1 (as rated by Moodys) or ceases to be rated by either S&P or Moodysthen the Contractor shall forthwith provide a replacement Performance Bond or Retention Bond(as appropriate) to the Purchaser. Failure to provide a replacement Performance Bond orRetention Bond in accordance with this Clause 3.12 shall constitute a material breach of theContract. The Purchaser shall be entitled to withhold a sum equivalent to the value of thePerformance Bond or the Retention Bond (as the case may be) from the Contract Price until thereplacement Performance Bond or Retention Bond as the case may be is provided by theContractor.

Add new clause 3.13

3.13 The Contractor warrants to the Purchaser that:

3.13.1 The Contractor shall not specify, knowingly authorise, cause to be used, use orknowingly suffer the use of in or about the Works, of any materials where it is known tothe Contractor or there are reasonable grounds for suspecting that such materials mightin themselves or as a result of the manner of their use pose a hazard to health and inparticular to the health of the personnel involved in the construction, maintenance anddemolition of the Works or to the eventual occupants thereof;

3.13.2 The Contractor shall not specify, knowingly authorise, or knowingly suffer the use in orabout the Works of any materials which at the time of specification or use are generallyaccepted as or are reasonably suspected of:

(i) being prohibited in themselves;

(ii) becoming prohibited when used in a particular situation or in combination withother materials;

(iii) becoming prohibited with passage of time;

(iv) becoming prohibited without a level of maintenance which is higher than thatwhich would normally be expected in works of the type under construction; or

(v) being damaged by or causing damage to the structure in which they areincorporated or to which they are affixed.

3.13.3 For the purpose of this Sub-clause a material is prohibited if, in the context of its usein the Works (whether alone or in combination or annexure with other materials) it:



(i) poses a threat to health and safety and in particular to the health and safety ofthose involved in the construction, maintenance, repair or use of the Works; or

(ii) pose a threat to the structural stability or performance or the physical integrityof the Works or any part thereof or any component therein; or

(iii) would or could have the effect of reducing the normal life expectancy of theWorks or any part thereof or any component therein.

3.13.4 If the Contractor becomes aware of the use in or about the Works of any prohibitedmaterials as referred to in this Clause 3.13 the Contractor shall notify the Purchaser inwriting.

Clause 4- Purchasers responsibilities

Modify Clause 4.2.

In part a) substitute the word industry for the word engineering.

Add new Clause 4.5:

4.5 Unless otherwise agreed in writing, the information included within the Schedules is the sumtotal of the available information and the Contractor shall take whatever measures are necessaryto assemble a complete basis for the design, installation and commissioning of the Works. It isnot the Purchasers intention to carry out any enabling works, other than those listed underPurchasers Obligations.

Clause 6 Sufficiency of Contract Price

Delete Clause 6.2:

Delete Clause 6.3 and substitute new clauses 6.3 and 6.4:

6.3 The Contractor has had an opportunity of inspecting the physical conditions (including thesubsurface conditions) and any other conditions of or affecting the site and shall be deemed tohave fully acquainted himself with the same and to have obtained all necessary information asto risks, contingencies and all other circumstances which may influence or affect the executionof the works. No failure on the part of the Contractor to discover or foresee any such condition,risk, contingency or circumstance whether the same ought reasonably to have been discoveredor foreseen or not shall entitle the Contractor to an addition of the Contract Price or to anextension of time. The Contractor shall not and shall not be entitled to rely upon any survey,report or other document prepared by or on behalf of the Purchaser regarding any such matter asis referred to in this Clause and the Purchaser makes no representation or warranty as to theaccuracy or completeness of any such survey, report or document. The Purchaser shall have noliability arising out of or in relation to any such survey, report or document or from anyrepresentation or statement whether they were negligently or otherwise made, therein contained.

6.4 The Contractor shall satisfy himself as to the suitability of any roads providing access to the siteto withstand the loading of heavy plant and equipment to be brought to the site by theContractor. The Contractor shall take all reasonable steps to maintain such access roads and toprevent damage to them and shall forthwith rectify any damage caused to such roads arising outof the use thereof by the Contractor, its servants or agents, consultants and Sub-contractors andtheir servants or agents. The Contractor shall be responsible for and shall indemnify thePurchaser from and against any and all expenses, liabilities, losses, claims and proceedingsresulting from any failure or default by the Contractor in performing his obligations under thisClause 6.4 and shall assist the Purchaser in the defence of such action, claim or proceedings.



Clause 7 Statutory and other obligations

Modify Clause 7.3:

7.3 Add additional sentence to the end of the clause:

The provisions of this clause shall not apply to any measure not implemented at the date of theAgreement, knowledge of which was in the public domain at the date of the Agreement. Wherea measure was in draft form at the date of the Agreement and in the public domain, then thisclause shall apply to any changes to the measure from the date of the Agreement.

Clause 8 Patent and other protected rights

Modify Clause 8.3:

8.3 Delete all of the words: any such patent, registered design to (and including) the words asstated in the Agreement nor to in the seventh, eighth and ninth lines.

Modify Clause 8.6:

8.6 Add an additional sentence to the end of this Clause: This Clause 8.6 does not apply to anymanuals, procedures, policies or reports that the Contractor is obliged to produce and provide tothe Purchaser pursuant to the Contract which shall be the sole property of the Purchaser.

Modify Clause 8.7:

8.7 Delete the remainder of the Clause from (and including) the words: or does not result in anincrease.. commencing in the sixth line.

Clause 9 Assignment and subcontracting

Delete clause 9.1 and replace with the following new clause 9.1:

9.1 Neither the Contractor nor the Purchaser shall, without the written consent of the other, assignthe benefit of this Contract provided always that the Purchaser may freely assign the benefit ofthe Contract without the consent of the Contractor to a funder, a funders appointee or apurchaser.

Modify Clause 9.2:

9.2 INSERT at the end of the Clause provided always that the Contractor will give to the ProjectManager a minimum of seven working days notice of the intended appointment of any Sub-contractor.

Delete Clauses 9.4 to 9.7 (inclusive) and replace with the following new Clauses 9.4 to 9.7:

9.4 INSERT new Clause the Contractor shall procure that the appointment of the Sub-contractorinvolved in any design element of the Work referred to in Clause 9.5 shall be made as a deed.

9.5 INSERT new Clause:

The Contractor shall within 21 days of a request in writing so to do by the Purchaser procurethe execution and delivery to the Purchaser of Sub-Contractors Collateral Warranties for thebenefit of the Purchaser or any funder of the Works in the form set out in schedule [ ] or insuch other similar form as the Purchaser and the Contractor may agree (acting reasonably).




The Contractor shall use his reasonable endeavours to ensure that any Sub-contractor engagedin relation to the design of the Works shall have and maintain in force subject to the same beingavailable at commercially reasonable rates, professional indemnity insurance to covernegligence, omission or default on the part of such Sub-contractor and shall be liable to theContractor for such negligence, omission or default. As and when the Contractor is reasonablyrequested to do so by the employer, the Contractor shall use reasonable endeavours to procurethat each Sub-contractor shall produce for inspection documentary evidence that professionalindemnity insurance is being maintained.


The Contractor shall within 21 days of a request in writing so to do by the Purchaser enter intoContractors Collateral Warranties for the benefit of any funder of the Works in the form set outin Schedule [ ] or in such similar form as the Purchaser and the Contractor may agree(acting reasonably).

Clause 10 Nominated Subcontractors

Delete Clause 10 in its entirety.

Clause 11 The Project Manager

Delete Clause 11.3 in its entirety.

Add Clause 11.8:

11.8 At any time during the performance of the Works by the Contractor, the Project Manager maygive the Contractor a Site Instruction to clarify matters arising in respect of the Works or toexpedite the progress of the Works.

Clause 12 Contract Manager and Contractors staff

Modify Clause 12.5

12.5 Add the words Contract Manager or the before Site Manager in the first line. In the secondline delete the word supervisory before staff and add the words or any member of anySub-contractors staff after staff.

Clause 14 Delays

Modify Clause 14.1:

14.1 In line 5 of the first paragraph, after the Contractor. insert The relevant party shall make allreasonable endeavours to promptly advise of any delay or potential delay as soon as it becomesapparent and shall take appropriate measures to mitigate said delays.

In line 1 of the second paragraph, after reasonably possible insert and in any event withinfourteen days of such notice.

Delete 14.1(a) in its entirety.

Delete 14.1(e) in its entirety.

Modify Clause 14.2:

14.2 delete the words any circumstances to (and including) but not limited to, in the first,second and third lines.

Modify Clause 14.4:



14.4 delete the words or (e) in the first line.

Modify Clause 14.6:

14.6 replace the reference to one hundred and twenty days with one hundred and eighty days.

Clause 15 - Damages for Delay

Modify Clause 15.2:

15.2 Delete all of the words: or a physical condition to (and including) the words Sub-clause6.3, either of in the second and third lines of the first paragraph.

Delete: (subject to any final review of the circumstances) in the second and third lines of thethird paragraph.


15.4 In the event that the Contractor becomes liable for the maximum Liquidated Damages undersub-clause 15.1 such liability shall constitute a material breach within the meaning of Sub-Clause 43.2(c), the terms of which Sub-clause shall apply.

Clause 17 Contractors Variations


17.4 If the Contractor intends to submit a proposal for a Variation in accordance with this Clause 17,it shall notify the Project Manager of such intention at the earliest practicable opportunity andin any event not later than seven days after the occurrence of the event which gives rise to theproposal.

Clause 18 Contractors claims

Add new Clauses 18.4:and 18.5

18.4 For the avoidance of doubt, this Clause 18 sets out the procedure for making a claim for anadditional payment or adjustment to the Contract Price that is expressly provided for in theContract. It does not, of itself, give rise to any right in favour of the Contractor to claim anyadditional payment or adjustment to the Contract Price.

Clause 19 Valuation of Variations and claims

Modify Clause 19.1:

19.1 In line 3 delete such amount including circumstances be reasonable and insert determinedaccording to one of the following methods:

As a fixed price quotation including a reasonable allowance for profit and overheads notexceeding the maximum percentages stated in Schedule 18;

On the basis of the Schedule of Rates in Schedule 18, where the Variation would involvemainly the Contractors own staff resources and is for works or services where a fixedprice quotation would be unsuitable; or

By reference to third party costs incurred to which the relevant percentage for profit shallbe added in accordance with Schedule 18.

The method of valuation of a Variation shall be specified by the Project Manager.

Modify clause 19.3.

19.3 Delete all text after the word Variation Replace with based on the method selected by theProject Manager in accordance with Clause 19.1.



Clause 20 - Confidentiality

Modify Clause 20.2:

20.2 Add a new sentence at the end of the Clause as follows: The provisions of Clause 2.4 shall notapply to any consent required under this Clause 20.2.

Clause 21 - Documentation

Modify Clause 21.4:

21.4 In line 3, replace good engineering practice with Good Industry Practice.

Modify Clause 21.6:

21.6 Delete from except in line 3 to end of sub-clause.

Modify Clause 21.9:

21.9 In line 2, replace supply the Documentation and manuals specified in Schedule 2 under theheading Final Documentation and Manuals with supply the draft Documentation andmanuals specified in Schedule 2

At the end of the Sub-Clause add: The draft Documentation shall be sufficient and completefor the Purchaser to operate and maintain the Plant in accordance with the Contractorsoperating and maintenance requirements and to purchase such consumables, parts andcomponents as may be required for the maintenance of the Plant. The Contractor shall supplythe final as built Documentation not later than ninety days following the Take-Over of thePlant.

Modify Clause 21.14:

21.14 Delete the final sentence The liability of the Contractor per cent of the Contract Price.

Clause 22 Inspection and pre-installation tests

Modify Clause 22.6:

22.6 At end of paragraph, add The Contractor shall be liable for and shall reimburse the Purchaserfor any Cost incurred by the Purchaser in attending any repeat tests in the event of a testfailure.

Clause 23 The Site

INSERT new Clause 23.8

23.8 The Contractor shall, at all times, prevent any nuisance or other interference with the rights ofany adjoining landowner, tenant or occupier or any statutory undertaker of which theContractor is or ought reasonably to have been aware arising out of the carrying out of theWorks. The Contractor shall be responsible for and shall indemnify the Purchaser from andagainst any and all expenses, liabilities, losses, claims and proceedings resulting from anyfailure or default by the Contractor in performing his obligations under this clause 23.8 andshall assist the Purchaser in the defence of any such action, claim or proceedings.




23.9 Without prejudice to the obligations of the Contractor under clause 23.8, the Contractor shallat all times ensure that there is no trespass by the Contractor, its servants, agents or Sub-contractors (including without limitation the oversailing of tower, crane, jibs) on or over anyadjoining or neighbouring property arising out or in the course of or caused by the carryingout of the Works and shall take all reasonable safety and other measures to prevent damage orinjury to any persons (including without limitation the occupiers of adjoining or neighbouringproperty and members of the public).


23.10 The Contractor shall in accordance with the requirements of the Purchaser afford reasonablefacilities for any other contractors employed by the Purchaser and their workmen and for theworkmen of the Purchaser and of any other properly authorised authorities or statutorycorporations or statutory bodies who may be employed in the execution on or near the Site ofany work not in the Contract or any contract which the Purchaser may enter into in connectionwith or ancillary to the Works.


23.11 It is agreed and declared for the purposes of clause 14 (but without limitation) that theContractor could reasonably foresee the activities of the contractors and workmen of thestatutory undertakers on or near the Site or parts thereof throughout the period of the carryingout of the Works.


23.12 The Contractor shall provide attendance for such other contractors and workmen as may bedirected by the Purchaser.

INSERT new clause 23.13

23.13 For the purposes of clause 23.12 attendance shall be deemed to cover all expenses incurred bythe:

23.13.1 planning, programming and co-ordinating his work with that of such othercontractors and workmen;

23.13.2 accepting delivery, unloading and storing of material for the other contractors asrequired; and

23.13.3 provision of space for their site offices and all reasonable access and facilities forthe proper execution of their work including the free use of craneage, scaffolding,ladders, stores, messrooms, latrines, site services, including background lightingand distributing boards for the contractors own localised lighting, and providingthe necessary washing facilities and lighting, provided that these facilities arenormally available on-site at the time.

Clause 25 Ownership of Materials

Add Clause 25.4:

25.4 If the Contractor claims payment or part payment for Materials not delivered to the Site, thenthe Contractor shall provide evidence to the Project Manager that contractual and otherarrangements have been made in accordance with clauses 25.1, 25.2 and 25.3. If the Contractorfails to provide such evidence to the satisfaction of the Project Manager then the ProjectManager shall be entitled to demand an advance payment bond from a major commercial bankor financial institution having a credit rating equal to or greater than A+ by S&P or A1 byMoodys in such form and in such amount as the Purchaser may reasonably require as a pre-condition of any payment made for the said Materials.



Clause 26 Health, Safety and Environment

Replace Clause 26.4 with:

26.4 Without prejudice to the Contractors general responsibility for safety as set forth in Sub-clause26.1, the Contractor shall be appointed as principal contractor, designer and contractor for thepurposes of the CDM Regulations. The Purchaser shall be the client and shall appoint thePlanning Supervisor.

The Contractor agrees to comply with the Health and Safety Plan prepared under the CDMRegulations and all reasonable instructions of the Planning Supervisor and that it will not beentitled to any addition to the Contract Price or extension of time to the Time for Completion incomplying with such instructions. The Contractor further agrees to co-operate with thePlanning Supervisor in the preparation of and to develop the Health and Safety Plan and/or theHealth and Safety File as required from time to time by the Planning Supervisor and inaccordance with the CDM Regulations.

Furthermore, the Contractor shall:

(a) take due notice of all advice given by the Planning Supervisor;

(b) ensure that no hazardous, unsafe, unhealthy or environmentally unsound condition oractivity over which he has control occurs at the Site; and

(c) nominate a competent person to be responsible for the proper observance of all safetyrequirements and procedures during work on the Site.

Clause 29 Meetings

29.2 In line 5, after return it to the Project Manager within a further seven days. insert If theContractor fails to return a signed copy of the minutes within the specified time then theminutes shall be deemed to have been accepted by the Contractor.

In Line 5, replace a further seven days with fourteen days from the date of issue.

Clause 31 Insurance

INSERT new Clause 31A:

31(A) The Contractor shall take out and maintain professional indemnity insurance from thecommencement of the Works and continuing up to 12 years from practical completion of theWorks with a well established and reputable insurer in the European Union with a limit ofindemnity of not less than [ ] in respect of any one claim or series of claims arsing out ofany negligence, omission, or default on any part of the Contractor provided always that suchinsurance is generally available in the European Union at commercially reasonable rates andterms. The Contractor shall immediately inform the Purchaser if such insurance ceases to beavailable at commercially reasonable rates and terms and with the approval of the Purchaser(such approval not to be unreasonably withheld) make alternative arrangements for protectingthe interests of the Purchaser, and the Contractor. As and when the Contractor is reasonablyrequested to do so by the Purchaser, the Contractor shall produce for inspection sufficientdocumentary evidence that the insurance required under this Clause is being maintained inaccordance with the terms of this Contract.

Clause 32 Completion of construction


33.1 Sub-clause not used.




32.2 As soon as the Plant is, in the opinion of the Contractor, substantially complete and ready forinspection, the Contractor shall so notify the Project Manager by means of a ConstructionCompletion Report in such form and detail as the Project Manager shall reasonably require.The Contractor shall propose a programme for such inspection commencing not sooner thanseven days nor later than fourteen days after the date of the Construction Completion Report,unless the Project Manager otherwise agrees in writing. The programme shall be in accordancewith the Approved Programme.


32.3 Upon the completion of the Preliminary Tests and any such inspection the Project Managershall sign the Construction Completion Report, with an endorsement stating either:

(a) that the Contractor has demonstrated to the Project Manager that the Plant or part thereofis substantially complete and in a condition such that the Take-Over Tests, includingOperability Test may be carried out in accordance with Clause 33 (in which case thesigned Construction Completion Report may include a note of any minor items requiringcompletion before the issue of a Take-Over Certificate); or

(b) that the Project Manager is not satisfied that the Plant or part thereof referred to inClause 32.2 is substantially complete and/or the Plant has not passed the PreliminaryTests and stating in what way the Plant or part thereof is not in accordance with theContract. The Contractor shall then complete the Plant or part thereof as necessary andshall repeat the procedure described in Clause 32.2.


32.4 The endorsement of the Construction Completion Report by the Project Manager is for thepurposes only of authorising the Contractor to perform the Take-Over Tests and does notconstitute evidence that the Contractor has fulfilled its obligations under the Contract.

Delete entire Clause 32.5

Clause 33 Taking over




33.10 Add the word reasonable before opinion in the first line.


33.14 In line 2, after issued, add subject to giving not less than ten working days notice,Add new sentence to the end of the clause Where such tests require that the Plant be operatedin such a way as to reduce the Purchasers expected income from the plant then the Contractorshall indemnify the Purchaser to the extent that the Purchasers expected income is soreduced.


33.15 The parties agree that the Operability Test forms part of the Take-Over Tests.


33.16 Notwithstanding the satisfactory conclusion of all the Take-Over Tests, Taking Over shall nottake place until the Contractor has submitted all Documentation required to be submitted priorto Take-Over in accordance with the Contract.



Clause 34 Site clearance

Modify Clause 34.1:

34.1 In line 2: after Plant insert or such longer period as the Contractor may agree with theProject Manager.

Clause 35 Performance Tests

Modify Clause 35.4:

35.4 In line 2, replace as soon as is practicable after he has taken over the Plant with as soon as ispracticable following commencement of the Performance Test Period.

Modify Clause 35.7:

35.7 Delete the words or by any other contractor employed by the Purchaser in the fifth and sixthlines of the second paragraph.

Add at the end of the first paragraph: Where any Performance Test is to be repeated, it shall becarried out within the Performance Test Period.


35.9 The Contractor shall pay the Purchaser Liquidated Damages as prescribed in paragraph 17.3 ofSchedule 17 if the Plant does not achieve the Economic Performance Levels. If the Plant doesnot achieve the Absolute Performance Levels within the Performance Test Period or anyextension thereto authorised in writing by the Project Manager, or if the Contractor becomesliable to pay to the Purchaser the maximum amount of Liquidated Damages specified inparagraph 17.3 of Schedule 17 for failure to achieve the Economic Performance Levels, thenthe Contractor shall be deemed to have committed a material breach of the Contract which isnot capable of remedy and the Purchaser may proceed to terminate the Contract in accordancewith Clause 43 (Termination for Contractors default).


35.10 In line 4, replace the period stated in Schedule 16 and referred to in Sub-clause 35.9 with thePerformance Test Period or any extension thereof authorised by the Project Manager

In lines 5 & 6 delete subject to the provisions of sub-clause 35.14








35.15 In lines 5 to 7, delete together with, if applicable, the Cost of any bond or guarantee tenderedon the terms set out in Sub-clause 35.13,

Add Clause 35.16:



35.16 Notwithstanding any other provision of the Contract, where the failure of the Works or asection of the Works to pass any Tests is such that it would deprive the Purchaser substantiallyof the whole of the benefit of the Works, such failure shall be deemed to constitute a materialbreach in terms of Sub-clause 43.2, the terms of which Sub-clause shall apply.

Add Clause 35.17.

35.17 Upon completion of the Performance Tests and receipt by the Project Manager of a report inaccordance with Schedule 16 indicating that the plant has achieved the Absolute PerformanceLevels and that the sum of any Liquidated Damages payable (if any) for failure to achieve theEconomic Performance Levels does not exceed the limit specified in paragraph 17.3 ofschedule 17 and once said Liquidated Damages (if any) have been paid in full by the Contractorto the Purchaser, the Project Manager shall issue to the Contractor a Performance TestCompletion Certificate.

New Clause 35A Availability Tests

Add new clause 35A.

35A The Availability Tests detailed in Schedule 16 shall be carried out during the AvailabilityPeriod in accordance with Schedule 16. If the plant does not achieve the GuaranteedAvailability then the Contractor shall pay the Purchaser Liquidated Damages as prescribed inparagraph 17.5 of schedule 17.

Clause 36 Acceptance





Delete Clause 36.3 and replace with new Clause 36.3 as follows:

36.3 Subject to the provisions of Sub-clauses 35.9 and 35.10, as soon as the Plant has passed thePerformance Tests and Availability Tests, the Project Manager shall issue to the Contractor acertificate (an Acceptance Certificate) with a copy to the Purchaser stating that the Plant isaccepted by the Purchaser as from the date thereof. For the avoidance of doubt, the AcceptanceCertificate shall not be issued before expiry of the Availability Period. The AcceptanceCertificate shall list any known Defects which the Contractor is bound to make good under theprovisions of Clause 37 (Liability for Defects) and any minor items still remaining to becompleted following the issue of a Take-Over Certificate under Sub-clause 33.7.



Modify Clause 36.6:

36.6 Delete the second paragraph beginning The Project Manager shall then.. in its entirety.

Add Clause 36.7:

36.7 Notwithstanding any provision of this Contract no Acceptance Certificate shall be issued untilthe Contractor has paid all Liquidated Damages payable to the Purchaser. Upon issue of theAcceptance Certificate, the Purchaser shall return the Performance Bond to the Contractor.

The Acceptance Certificate shall not be issued unless and until the Retention Bond has beenprovided in accordance with Clause 3.11.



Clause 37 Liability for Defects



Modify Clause 37.2:

37.2 Replace three hundred and sixty-five days with two years. Delete the word relevantbefore Take-Over Certificate in the second line.


37.3 The Contractor shall bear his own Cost of making good any Defect.

Modify Clause 37.6:

37.6 Replace three hundred and sixty-five days with two years


37.12 Sub-clause not used

Add Clause 37.14:

37.14 If any Latent Defect (which term shall include (without limitation) any defect which relates tothe choice of Materials and equipment in contact with corrosive media, to the design of thePlant to minimise material deposition in pipes and ducts, and to the achievement of the DesignLife) shall appear in any part of the Works within the Latent Defects Liability Period, the sameshall be made good by the Contractor at its expense by repair or replacement forthwith uponreceipt of a notice from the Purchaser giving particulars of the Latent Defect.

Add Clause 37.15:

37.15 Notwithstanding the provisions of Sub-clause 37.14 if any Latent Defect shall appear in anypart of the civil engineering works, permanent buildings or structures forming part of the Workswithin the Latent Defects Liability Period, the same shall be made good by the Contractor at itsexpense by repair or replacement forthwith upon receipt of a notice from the Purchaser givingparticulars of the Latent Defect.

Clause 38 Final Certificate

Modify Clause 38.1:

38.1 In line 1, replace Subject to the provisions of Sub-clauses 37.10, 38.2 and 38.3 with Subjectto the provisions of Sub-clauses 37.10, 38.2, 38.3 and 38.6

Modify Clause 38.4:

38.4 In line 2, after a Final Certificate has been issued in respect of that part insert , subject tothe provision of Sub-clauses 37.14 and 37.15.

Delete from and including for all purposes and in any proceedings on line 6 to the end of theclause and replace with:

that where and to the extent that any of the particular qualities of any materials or goods orany particular standard of an item of workmanship was described expressly in thedocumentation listed in Schedule [ ] or in any variation issued by the Project Manager underClause 16 or Clause 17 to be for the approval of the Project Manager the particular quality orstandard was to the reasonable satisfaction of the Project Manager but such Final Certificateshall not be conclusive evidence that such or any other materials or goods of workmanshipcomply or complies with any other requirements or terms of this Contract.

Add new Clause 38.6.



38.6 The Retention Bond shall be returned to the Contractor upon issue of the Final Certificate orFinal Certificates that cover the whole of the Plant and the Works.

Clause 39 - Payment

Delete Sub-clauses 39.1 to 39.9 (inclusive) in their entirety.

Insert new Sub-clauses 39.1 to 39.12 as follows:

39.1 Payment of the Contract Price shall be made by instalments as provided in Schedule 19,provided that:

a) The amount of the first payment shall only be made when the Purchaser hasreceived the Performance Bond and Company Guarantee.

b) The payment against each Milestone Event shall become due only when theMilestone Event has been achieved in full or on the date shown against the relevantMilestone Event as set out in Schedule 11, whichever is the later.

c) The Project Manager may at his discretion authorise payment for items deliveredin advance of the scheduled Milestone Event Date, provided that the sum of the paymentsto date does not exceed the cumulative payments corresponding to that point in time asdocumented in Schedule 19.

39.2 In respect of each Milestone Event for which the Contractor considers it is entitled to payment,the Contractor shall submit an application for payment to the Project Manager showing theMilestone Event which has been achieved supported with complete detailed documentaryevidence of the Milestone Event having occurred. Each application shall take account of anyaddition to or deduction from the Contract Price as may have accrued.

39.3 Within fourteen days of receipt of the application for payment, the Project Manager shall issueboth the Contractor and Purchaser an Interim Certificate certifying the amount that in theProject Managers opinion is due. Such amount shall include any addition to or deduction fromthe Contract Price as may have accrued, and if the amount of any such addition or deductionhas not been determined at the time when the Interim Certificate is issued, the Project Managershall make such provisional allowance in respect thereof as is fair and reasonable in thecircumstances. The Project Manager may adjust any previous under or over certification in anyInterim Certificate issued by him.

39.4 Following receipt of the Project Managers certificate in accordance with Clause 39.3, theContractor shall submit an invoice to the Purchaser for the sum certified as payable with a copyof the Project Managers certificate attached. The Purchaser shall pay the amount certified bythe Project Manager as due to the Contractor within twenty-one days of receipt of theContractors invoice submitted in accordance with this Clause 39.4.

The Purchaser shall be under no obligation to make any payment to the Contractor relatingpartly or wholly to portions of the Works which have not been delivered to the Site or, in thecase of design work, not submitted or otherwise demonstrated to the Purchaser and ProjectManager.

39.5 If the Purchaser fails to make payment for any sums that are rightly due to the Contractor, theamount unpaid shall bear interest from the Final Date for Payment until it is received by theContractor. The interest shall be accrued from day to day at an annual rate equivalent to thebase rate for the time being of The National Westminster Bank Plc.



39.6 In addition to the provisions of Sub-clause 39.5 the Contractor may give the Purchaser 28 dayswritten notice of his intention to suspend performance of the Contract if proper certification ofan instalment in accordance with Clause 39.3 is not made or if payment by the Final Date forPayment is not made in accordance with Clauses 39.4 or 39.9 (unless a notice under Sub-clause39.11 has been given). The right to suspend performance shall cease when the Purchaser makespayment of the amounts due. If such failure shall continue for seven days after the giving ofsuch notice, then at any time thereafter and provided such failure is still continuing, theContractor may suspend further performance of the Contract until the certificate is issued orpayment is made in full (whichever is applicable). All additional Cost (plus any Profit)reasonably incurred by the Contractor as a result of such suspension and subsequent resumptionshall form an addition to the Contract Price provided that the Contractor submits a claim inaccordance with Clauses 18 and 19.5 and the Contract shall be amended as may be agreedbetween the Contractor and the Purchaser or as may be reasonably be necessary toaccommodate the suspension of performance and the period of such suspension, providedalways that any relevant date or period stated in Schedule 11 or any extension thereof shall notbe extended by a period that exceeds the period between the date of suspension in accordanceherewith and the date upon which the certificate is issued or payment is made in full (whicheveris applicable).

39.9 Not later than three months after receipt of the Acceptance Certificate the Contractor shallsubmit to the Project Manager an application for payment of all outstanding monies which theContractor considers due to it under the Contract supported by a detailed statement thereof.

Within three months after the date of receipt of such application for payment and of allinformation reasonably required for its verification, the Project Manager shall certify the finalinstalment which in the opinion of the Project Manager is due under the Contract. In givingsuch certificate the Project Manager may adjust any previous underpayment or overpayment inany certificate issued by them.

Following receipt of the Project Managers certificate in accordance with this Clause 39.9, theContractor shall submit an invoice to the Purchaser for the final sum certified as payable with acopy of the Project Managers certificate attached. The Purchaser shall pay the amount certifiedby the Project Manager as due to the Contractor within twenty-one days of receipt of theContractors invoice submitted in accordance with this Clause 39.9.

39.10 Every certificate issued by the Project Manager pursuant to this Clause shall be sent to thePurchaser and on the Purchasers behalf to the Contractor. By such certificate the Purchasershall give notice to the Contractor specifying the amount (if any) of the payment proposed to bemade and the basis on which it was calculated.

39.11 Without prejudice to any other remedy he may have, the Purchaser shall be entitled to deductfrom any payment due to the Contractor any sums which are due from the Contractor to thePurchaser under the Contract. If the Purchaser intends to withhold any amount from or set-offany amount against any payment which is due to the Contractor it shall notify the Contractor inwriting not later than five days before the Final Date for Payment specifying the amountproposed to be withheld and the ground for withholding payment or if there is more than oneground each ground and the amount attributable to it.

39.12 All payments under the Contract shall be in pounds sterling.

Renumber existing Sub-clauses 39.10, 39.11 and 39.12 as 39.13, 39.14 and 39.15 respectively.

Clause 40 - Provisional and prime cost sums

Modify Clause 40.1:

40.1 In line 2, after may be required, insert the work shall only be executed and.





Modify Clause 40.3:

40.3 In line 1 delete and prime cost.

Clause 41 Suspension

Modify Clause 41.3:

41.3 Replace the reference to ninety days in the third line with three hundred and sixty fivedays.

Clause 43 Termination for Contractors default

43.10 Delete fourteen days and replace with 28 days

Clause 44 Limitation of liability

Modify Clause 44.1:

44.1 Delete Neither the Contractor nor the Purchaser shall be liable to the other and replace withThe Purchaser shall not be liable to the Contractor.

Delete sub-clauses (i) to (v) (inclusive).

Replace existing clause 44.2

44.2 The Contractor shall be liable to the Purchaser for:

a) wastage, loss or contamination during its use in the Plant of any process consumablewhich shall be deemed to include feedstocks, chemicals, biochemicals, catalysts andutilities; and

b) loss or deferment of anticipated or actual profit, loss of revenue, loss of use, loss ofproduction, business interruption or any similar damage or for any consequential orindirect losses of any other kind resulting from or arising out of or in connection with theWorks or the performance thereof or any act or omission relating thereto howsoevercaused;

up to a maximum cumulative value of 500,000 For the avoidance of doubt this limit shallnot apply to Liquidated Damages payable under the Contract.

Add new Clause 49:

Clause 49 - Communications

49.1 All certificates, notices and written instructions to be given to the Contractor by the Purchaseror Project Manager under the Contract shall be sent by facsimile transmission, registered postor delivered by hand to the address or fax number shown for the Contractor in the Agreement orby hand to the Contract Manager or Site Manager (if any).

49.2 All certificates, notices and written to be given to the Purchaser or Project Manager by theContractor under the Contract shall be sent by facsimile transmission, registered post ordelivered by hand to the address or fax number shown for the Purchaser or Project Manager inthe Agreement or by hand to the Project Manager or the Project Managers Representative.



49.3 In the absence of evidence to the contrary, all deliveries by hand and registered post shall bedeemed to be received upon delivery to the addressee and faxes deemed to be received by therecipient at the moment of completion of transmission (evidenced by transmission note),provided that when delivery by hand or fax takes place outside working hours it shall bedeemed to have been received at the beginning of the next working day.

SEMBCORP UTILITIES TEESIDE FICHTNER

739-V1-Contract schedules turbine.doc


ISSUE NUMBER DRAFT 1 2 3 4 5 6

DATE 25/02/04 18/03/04

AUTHOR PME DSA

CHECKED RJH RJH

739-V1-Contract schedules turbine.doc

WILTON 10 BIOMASS POWER PLANT

CONTRACT SCHEDULES -TURBINEGENERATOR PACKAGE


739-v1-contract schedules turbine.doc, 23/03/04Contract Schedules -Turbine Generator PackagePage i

RECORD OF CHANGES

Draft Draft issue to client for discussion

1 Updated to reflect Sembcorps comments 18/03/04


739-v1-contract schedules turbine.doc, 23/03/04Contract Schedules -Turbine Generator PackageSchedules, Page i i

TABLE OF CONTENTS

1. SCHEDULE 1 DESCRIPTION OF THE WORKS....................................................32. SCHEDULE 2 DOCUMENTATION...........................................................................53. SCHEDULE 3 RESPONSIBILITIES OF PURCHASER..........................................64. SCHEDULE 4 HEALTH AND SAFETY ....................................................................75. SCHEDULE 5 ENVIRONMENTAL PROTECTION AND WASTE DISPOSAL116. SCHEDULE 6 QUALITY ASSURANCE AND VALIDATION.............................127. SCHEDULE 7 SUBCONTRACTING .......................................................................158. SCHEDULE 8 CONTRACTORS NAMED PERSONNEL....................................169. SCHEDULE 9 TRAINING BY CONTRACTOR.....................................................1710. SCHEDULE 10 PARTS WITH LIMITED WORKING LIFE ...............................1911. SCHEDULE 11 - PROGRAMME & TIME FOR COMPLETION..........................2012. SCHEDULE 12 LIQUIDATED DAMAGES FOR DELAY....................................2113. SCHEDULE 13 PRE-INSTALLATION TESTS AND PROCEDURES................2214. SCHEDULE 14 CRITERIA FOR THE COMPLETION OF CONSTRUCTION2315. SCHEDULE 15 TAKE-OVER TESTS......................................................................2416. SCHEDULE 16 PERFORMANCE, AVAILABILITY TESTS & PROCEDURES2517. SCHEDULE 17 PERFORMANCE GUARANTEES & DAMAGES FOR FAILURE

2618. SCHEDULE 18 VALUATION OF VARIATIONS AND CLAIMS .......................2819. SCHEDULE 19 TERMS OF PAYMENTS & SCHEDULE OF PRICES..............3020. SCHEDULE 20 - AGREED FORM OF COMPANY BOND.....................................3221. SCHEDULE 21 - AGREED FORM OF PERFORMANCE BOND ..........................3322. SCHEDULE 22 - AGREED FORM OF RETENTION BOND..................................3423. SCHEDULE 23 - AGREED DEVIATIONS FROM SPECIFICATION...................35


739-v1-contract schedules turbine.doc, 23/03/04Contract Schedules -Turbine Generator PackageSchedules, Page 3

1. SCHEDULE 1 DESCRIPTION OF THE WORKSWhether or not specifically described in the Specification, the Contractor is responsible forproviding a complete working installation, equipped with all necessary plant, equipment andfacilities, excluding those which are specifically the obligation of the Purchaser, to enable theplant to achieve the guaranteed power output, efficiency and availability throughout itsDesign Life.

1.1 The SiteThe Site is located at Sembcorp Utilities Teesides Wilton Site whose address is

Sembcorp Utilities Teesside LtdSembcorp Utilities Teesside HeadquartersPO Box 1985 Wilton InternationalMiddlesboroughTS90 8WS

More particularly the site is identified on drawing reference 739-008 which is in volume 4 ofthe Specification

1.2 General Description of Scope of WorksThe Contract comprises the design, manufacture, test in works, shipment, transport anddelivery to site, unloading at site, erection, painting, commissioning, putting into normaloperation, testing for performance, reliability on completion, instruction of the Purchaserspersonnel in the operation and maintenance of the works including all ancillary and auxiliaryequipment and systems, interconnecting piping, cabling, instrumentation and interface workwith upstream or downstream facilities, the provision of all labour, materials, Contractorsequipment, temporary works, and everything whether of a temporary or permanent nature,required to provide a complete working installation meeting the performance parametersdefined in this Specification and providing all of the facilities necessary for the operation andmaintenance of the installations and the site on which the installations are situated.The Contractor shall be responsible for the new Plant and its integration within the existingsite taking into account the existing working facilities, offices and surroundings.In order to discharge his obligation, the Contractor shall carry out all basic, complimentaryand additional Works, whether permanent or temporary, including all modifications to any ofthe existing facilities. The Contractors obligation to carry out and perform the Worksproperly includes inspection of site, tests and measurements necessary to provide a full designbasis, design, construction, manufacture, supply, test of equipment, shipment, transport,delivery, unloading on site, erection, painting, testing, operation, removal of constructionwaste and back-filling.The Contractor shall hand over the Plant and demonstrate its performance whilst the Plant isoperated by the Purchasers staff under the supervision of the Contractor including training ofthe Purchasers staff and personnel in accordance with Good Industry Practices, carrying outof all Tests and maintenance of the Project as defined in the specification during the DefectsLiability Periods, all in accordance with established technical principles and in accordancewith the Contractors Operating and Maintenance Manuals and to the satisfaction of thePurchaser.The Works or parts thereof shall comply in all respects with all the relevant Legislationincluding Health & Safety regulations. Standardisation shall be employed in the design as faras possible. Care shall be taken to ensure safe operation as well as simplicity of assembly anddismantling of all parts of the Plant.



In addition, the Works shall be provided with all the necessary facilities for connecting themeasuring instruments required for plant performance assessment during commissioning andoperational control and checking of the technical and economic aspects of operation. TheContractor shall include in his Contract Price for the provision of independent agencies andlaboratory facilities where stated as required.All installations shall be fully protected from adverse effects of atmospheric conditionsoutside and inside the biomass plant, fuel qualities and variations in fuel characteristics.Only system designs, equipment and materials proven to give long and reliable service insimilar applications shall be incorporated in the Plant and its associated systems.Unless stated otherwise in this specification, International Standards and Codes shall be usedfor design, construction, testing, etc. of the various items of the Plants. However, in areaswhere such codes and standards are inferior to recognised national codes and standards, thesuperior standards shall be followed. In all such cases, the Contractor shall inform the ProjectManager of the justifications for using other than International Standard for consideration andapproval.Adequate interconnections, complete with necessary controls, shall be provided between thedifferent systems of the Plant, for achieving maximum operational flexibility.System stability, operational simplicity, maintenance ease and convenience, complete safetyof staff and machines under normal and abnormal conditions, and good efficiency shall beessential features of the Plant design.Plant and system designs shall be such as to require the minimum manpower for running thebiomass plant and its associated systems, consistent with plant and personnel safety.The works shall include the design, supply, construction and commissioning of a completepower island, fully integrated with the other elements of the biomass plant and existing site.The outline scope of supply includes: steam turbine generator and oil system, water-cooledcondenser, LP condensate supply system including pumps and pre-heaters, turbine bypassstation, control system and instrumentation, electrical equipment, interconnecting pipeworkand cabling. A more detailed description of the scope of supply is given in Volume 3 Part 4Power Island



2. SCHEDULE 2 DOCUMENTATION

The requirements for documentation are described in the Specification Volume 2 Part 10.



3. SCHEDULE 3 RESPONSIBILITIES OF PURCHASERThe Purchaser shall supply the following to the Contractor:1) Connections points for the following utilities:

a) Electricity.

b) Towns water.

c) Sewage/trade effluent.

d) HP Steam

e) Condensate return

f) Cooling water

2) Operational manpower for:

a) Commissioning under instruction from Contractor.

b) Availability testing

3) Land for the turbine generator construction site.

4) The building in which the turbine generator set is housed.

5) Access to turbine construction site.

Volume 2 Part 2 of the specification addresses the terminal points for the Plant supply and addressesmore fully the process responsibility of the Purchaser.



4. SCHEDULE 4 HEALTH AND SAFETYThe Contractor shall at all times in performing the Works comply with all the requirements ofhealth and safety Legislation and, in particular, the requirements of the CDM Regulations.The Contractor shall prepare a Design Health and Safety Plan for the Works during the designphase of the Works. The Contractor shall develop the Design Health and Safety Plan into theConstruction Health and Safety Plan, which shall be submitted to the Planning Supervisor forapproval prior to construction on Site.The Contractor shall manage, monitor and record all aspects of safety management as per therequirements of the CDM Regulations and shall submit to the Planning supervisor thecomplete Health and Safety File on completion of the Works.

4.1 ResponsibilityThe Contractor shall be responsible for the management of Health and Safety (H&S) for allthe Works under the Contract. The Contractors shall adequately resource and manage theimplementation of H&S policies and procedures for all those involved with the project.The Contractor shall control all Site activities on the basis that safety is an absolute prioritytaking precedence over all other matters.The Contractor shall be responsible for co-ordinating, monitoring, and regular auditing of theH&S aspects of all elements of the Works. The Contractor shall ensure that personnel canmeet their H&S responsibilities whilst delivering the Works on schedule and to budget.

4.2 The Construction (Design and Management) Regulations - CDM

4.2.1 CDM ResponsibilitiesThe following table assigns CDM roles to the different parties involved.

CDM Regulations-Duties on Parties in Design and Construction Phase

CDM Roles Responsibility

Client : The Purchaser

Planning Supervisor : The Contractor

Principal Contractor : The Contractor

Designers : The Contractor and

Sub-contractors (to be appointed by Contractor)

Contractors : The Contractor and

Sub-contractors (to be appointed by Contractor)

4.2.2 Planning SupervisorDuring the development phase of the project, the Purchaser has acted as the PlanningSupervisor and produced a pre-Tender Health and Safety Plan prepared for this project.This is included in Volume 2 Part 8.Following the Commencement Date, the Contractor shall undertake the role of PlanningSupervisor. The pre-Tender Health and Safety plan shall be developed by the Contractortaking account of the detailed design, risk assessments, reviews of the installationtechniques and programme in order to produce a Construction Health and Safety Plan.This plan is a working document that will be amended and added to throughout the life of



the Project. Its development and implementation are a key element of meeting the CDMRegulations.

4.2.3 Principal ContractorThe Contractor shall undertake the role of Principal Contractor.The Principal Contractor shall ensure that the Construction Phase H&S Plan isimplemented and monitored by auditing. The Project Manager shall carry out regularsafety audits of all contractors on the Site.The Contractor shall also comply with all relevant sections of the Management of Healthand Safety at Work Regulations.The Principal Contractor has a duty to liaise and co-operate with the Project Manager andother organisations carrying out Works at Project interfaces to ensure safety co-ordination.

4.3 Supply of InformationThe Contractor shall demonstrate:1. Compliance with Section 6 of the Health and Safety at Work Act 1974 as amended by the

Consumer Protection Act 1987. The Contractor shall provide information for all phasesof the project including design, construction, commissioning and maintenance. This is toinclude sufficient information to the Purchaser to operate, maintain and de-commissionthe Plant,

2. Within the Construction H&S plan the sequence of erection and his proposed constructionmethods supported by diagrams and drawings, as necessary, showing the arrangementsfor movement of materials and plant onto the Site, setting to work and providing access,

3. Within the Construction H&S plan the sequence of the Plant commissioning.4. How safety shall be achieved, along with the specific risk assessments in accordance with

Regulation 3 of the Management of Health and Safety at Work Regulations.The Contractor shall submit a first issue of the Construction H&S Plan to the Project Managerfor review within eight (8) weeks of the Commencement date. This plan shall be revised,developed and submitted to the Project Manager for his review and comment at least 4 weeksprior to the start of construction work on site.

4.4 Safety StudiesThe Contractor shall allocate sufficient time and resources to participate in and lead fullHazard and Operability (HAZOP) studies for the complete Works including all relevantaspects of all systems.

4.5 Safety PlanningThe Contractor shall prepare detailed method statements for all construction works, takinginto consideration the work of his Sub-contractors. These method statements shall besubmitted to the Project Manager in advance of the work for review and comment. TheProject Manager will audit the construction work against the overall H

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