Circular No. 08/2013/TT-BXD guiding certain contents on the establishment and management of investment construction costs for the Lai Chau Hydropower Project

CIRCULAR

Guidelines on certain aspects of establishing and managing investment construction costs for the Lai Chau Hydropower Project

investment in constructing the Lai Chau hydropower plant

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Pursuant to Decree No. 17/2008/NĐ-CP dated February 4, 2008 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Construction;

Pursuant to Decision No. 188/QĐ-TTg dated January 29, 2011 of the Prime Minister on the management mechanism and implementation of the Lai Chau Hydropower Project;

Pursuant to the guidance of the Prime Minister in Document No. 2203/VPCP-KTN dated March 21, 2013 regarding the issuance of this Circular guiding certain aspects of establishing and managing investment construction costs for the Lai Chau Hydropower Project.

Minister of The guidelines on certain aspects of establishing and managing investment construction costs for the Lai Chau Hydropower Project are as follows:

I. GENERAL PROVISIONS

1. This Circular guides certain aspects of establishing and managing investment construction costs for the Lai Chau Hydropower Project including:

1.1. Other direct costs in the construction project budget;

1.2. Costs not included in other direct costs in the construction project budget;

1.3. Other direct costs, common costs, and pre-tax income included in the price of materials extracted at the Lai Chau Hydropower Project site;

1.4. Material transportation costs to the construction site;

1.5. Labor rates for large panel formwork installation, dismantling, and erection at the hydrotechnical works;

1.6. Construction costs for temporary housing at the construction site for living and construction management;

1.7. Cost standards for preparing construction organization design;

1.8. General Contractor costs;

1.9. Contract performance guarantee;

1.10. Costs for dismantling, transporting to the construction site, and removing equipment used for construction upon completion, including cranes MD900, MD2200 (or equivalent), crawler cranes with a capacity of 150 tons or more, concrete mixing plants, cold plants, conveyors, aggregate crushing stations, etc.;

1.11. Night work costs;

1.12. Other cost items outside those mentioned above in the total investment ceiling, total budget estimate, and project budget estimate for the Lai Chau Hydropower Project shall be implemented according to Decision No. 188/QĐ-TTg dated January 29, 2011 of the Prime Minister and relevant state regulations corresponding to each period.

2. Principles for Establishing and Managing Costs

The establishment and management of investment construction costs for the Lai Chau Hydropower Project shall be carried out in accordance with Decision No. 188/QĐ-TTg dated January 29, 2011 of the Prime Minister, Decision No. 819/2010/QĐ-TTg dated June 6, 2010 of the Prime Minister approving the investment project, relevant state regulations corresponding to each period, and must ensure the investment objectives of the project, ensuring accuracy, completeness, and suitability with actual conditions and objective requirements of the project.

II. SPECIFIC PROVISIONS

1. Other direct costs in the construction project budget.

These are costs for necessary works directly serving the construction of the project such as moving labor within the construction site (excluding costs for transporting workers from temporary housing at the construction site to the construction site), protecting the environment for workers and surrounding areas, testing construction materials by the contractor, and costs for pumping water, dredging silt, which are not regular and cannot be determined from the design. The level of other direct costs is determined as follows:

1.1. For construction works (items) inside tunnels, other direct costs (including operation costs, regular maintenance costs for water supply, drainage, ventilation, electricity, and traffic systems serving construction inside tunnels) are calculated at 6.5% of the total material costs, labor costs, and construction machinery costs in the construction project budget.

1.2. For works (items) outside tunnels, other direct costs are calculated at 2% of the total material costs, labor costs, and construction machinery costs in the construction project budget.

2. Costs not included in other direct costs in the construction project budget (determined by preparing a cost budget according to the design, scale, test plan, and approved transportation plan), including:

2.1. Initial investment costs for technical water systems for construction and living water systems at the construction site.

2.2. Initial investment costs for ventilation, lighting, electrical, drainage, and traffic systems serving construction inside tunnels for tunnel construction works.

2.3. Initial investment costs for pumping water, draining foundation pits immediately after river diversion and flood prevention, and a 0.4 kV power system serving construction and living needs.

2.4. Regular costs for draining foundation pits immediately after river diversion and flood prevention.

2.5. Costs for moving construction forces to the project site; costs for dismantling, transporting, and installing tower cranes and crawler cranes ≥ 150 tons within the construction site; maintenance of traffic systems serving construction within the construction site; operation costs for the power system from the point of connection to the construction power grid to the final low-voltage substation of the project (the metering point for purchasing electricity).

2.7. Additional testing costs for roller-compacted concrete (RCC) construction testing.

3. Other direct costs, common costs, and pre-tax income included in the price of materials extracted at the Lai Chau Hydropower Project site.

For materials such as sand, gravel, cohesive soil, and filter materials produced by construction units for use in the project, the ratio of other direct costs, common costs, and pre-tax income is applied to calculate the product selling price. The specific ratios of other direct costs, common costs, and pre-tax income are determined as follows:

3.1. Other direct costs are calculated at 1.5% of material costs, labor costs, and construction machinery costs.

3.2. Common costs are calculated at 2.5% of construction machinery costs.

3.3. Pre-tax income is calculated at 3% of direct costs and common costs. A comprehensive budget estimate table for production material costs is attached as Appendix 1 to this Circular.

4. Determination of material transportation costs to the construction site.

The transportation costs shall be determined based on the type of materials, transportation plan, supply location, level of transport road, and freight charges. The project owner and contractor shall negotiate and agree on the transportation costs to apply.

5. Regarding the quota for processing, installation, dismantling of large formwork panels for hydraulic works projects for use.

Large formwork panels for hydraulic works projects refer to formworks with a size of one panel from 1.5 x 2m or larger. The quota for processing, installation, and dismantling of large formwork panels for hydraulic works projects shall be implemented according to the announcement of the Ministry of Construction.

6. Temporary housing costs at the construction site for living and managing construction operations (including the cost of transporting construction workers from temporary housing at the construction site to the construction site, and regular maintenance and repair costs) shall be calculated based on the necessary requirements of the project, according to the total layout and overall progress of the project approved by the competent authority, but not exceeding 2% of the estimated construction cost value of the project.

7. Quota for organizing construction design costs: The general contractor of the Lai Chau Hydropower Project shall be paid the construction organization design costs. The general contractor shall prepare the budget for organizing construction design costs based on the following percentage rates:

a) applying a rate of 8% of the design fee corresponding to temporary works items and non-spillway dam sections.

b) applying a rate of 12% of the design fee corresponding to the remaining items.

For the design of mining operation methods: The general contractor shall hire consultants with sufficient capacity to carry out the design; the cost of this work shall be calculated like the design of construction organization stripping.

8. General Contractor Costs: The General Contractor Costs for the Lai Chau Hydropower Project shall be determined by the General Contractor preparing the budget, which is then approved by the Project Owner, with the General Contractor's benefit being 40% of the project management costs stipulated in the Circulars guiding the management of construction investment costs issued by the Ministry of Construction corresponding to each period and included in the total construction budget estimate.

9. Ensuring Contract Performance

The parties in the contract, which are state-owned enterprises (Sông Đà Corporation and Vietnam Electricity Group), may negotiate the value of the contract performance guarantee: with the application of a contract performance guarantee form for contractors designated to implement the Lai Chau Hydropower Project at a rate of 1%.

10. Costs for dismantling, transporting to the construction site, and removing when the work is completed, as well as storing and installing equipment for construction purposes including: MD900 cranes, MD2200 cranes (or equivalent), crawler cranes of 150 tons or more, concrete mixing plants, cold plants, conveyors, crushing stations...: Additional costs for dismantling, transporting to the construction site, storing, and installing such equipment as MD900 cranes, MD2200 cranes (or equivalent), crawler cranes of 150 tons or more, concrete mixing plants, cold plants, conveyors, crushing stations... shall be allowed. The contractor shall prepare the budget and submit it to the Project Owner for review and approval based on the approved construction layout plan by the Ministry of Industry and Trade as the basis for implementation.

11. The provisional budget for processing equipment and steel structures at the construction site shall be prepared like the provisional budget for installing equipment.

12. Night work costs shall be included in the provisional construction budget with the calculation method as Appendix No. 2 attached to this Circular.

III. IMPLEMENTATION ORGANIZATION

This Circular shall take effect 45 days from the date of signature and shall apply to the Lai Chau Hydropower Project. Items of the project that have been settled will not apply this Circular. During the implementation process, if there are any difficulties, please report to the Ministry of Construction for research and resolution./.