ADBP Publish a Paper on Dredging Cost Standards
The financial costs associated with
dredging activity are highly variable, depending on the plant being employed
and the type of dredging being undertaken. Since 2005, the Construction
Industry Research and Information Association (CIRIA), has published the book
‘Cost standards for dredging equipment’. The guide presents the primary capital
values and costs associated with a range of dredging plant, based on their specification.
This publication is commonly used throughout the industry for a range of
studies including CAPEX estimation, cost allocation between dredging
contractors in joint venture and most prominently in disputes, where cost
estimation is required to be undertaken.
Due to the high capital cost and subsequent value of dredging plant, the accurate calculation of the respective depreciation and interest is fundamental to the build-up of the estimated daily operating plant rates. Ongoing maintenance and repair of the plant also forms a primary cost. The CIRIA publication details these items for a variety of dredging plant. However, it does not provide detail on other operational costs such as labour, insurance, fuel, wear and tear, overheads and profit/risk. These must be derived from further calculations to ascertain the total cost of leasing the dredging plant, commonly known as the daywork rate.
Consistent and widespread anecdotal evidence within the dredging industry has postulated that the costs derived by the use of the CIRIA publication are elevated above the market daywork rates for dredging equipment for projects internationally. This paper investigates these contentions and compares industry rates for various projects over the past ten years with rates calculated and developed through the use of CIRIA. Deviations are highlighted and where possible recommendations provided to improve the estimation of costs associated with dredging plant.
Drawing on their experience of dredging cost estimating, and utilising the Anthony D Bates Partnership’s historical pricing database - spanning some 600+ managed project over more a than 40 years - Colm Sheehan and Leigh Holmes recently drafted a unique technical paper comparing ‘CIRIA (Book) Dredging Cost Standard’ developed dredging rates, to their market equivalents. The paper focuses on TSHD maintenance dredging data but has a broader application for other types of dredging equipment as well.
The paper was presented by Leigh Holmes at the CEDA Dredging Days conference in Rotterdam on the 7th of November (2019) and was well-received - promoting constructive discussion amongst CIRIA Dredging Cost Standard book users across the dredging industry.
Contact for more information:
Colm Sheehan PhD CEng BEng MIEI ACIArb - E: [email protected]
Leigh Holmes BSc (Hons) - E: [email protected]