EPC Full Form

EPC full form is Engineering, Procurement, and Construction. The term is used as a type of contract in the construction industry. Through EPC contractor and client relationship is explained. The term consists of all information about the project which includes designs, procurement of materials, and labour & equipment needed.

What is the Full Form of EPC?

As mentioned above the full form of EPC is Engineering, Procurement, and Construction. The term EPC is used for contracts in the construction industry. The EPC defines the relationship between contractor and client. The contract includes all the required information regarding the project which includes the time of completion, design, requirement of material, staff or labor, equipment, investment needed, and much more.  

About EPC Projects

The project starts with the designing and engineering plan and further includes the requirement for materials and the end of construction. All the tasks from starting to the end of construction are managed and monitored by a contractor who has specialized knowledge related to the sector of EPC and that's the reason they are known as EPC contractors. The EPC contractors are responsible for providing projects or construction as per the client’s requirement. 

Different Functions of EPC

The functions of EPC, full form of which is Engineering, Procurement, and Construction, are divided into 4 sections 

1. Engineering Function

• Basic Engineering
• Detailed Engineering
• Planning
• Construction Engineering

2. Construction Function

• Electrical installation
• Mechanical erection
• Civil Engineering

3. Procurement Function

• Logistics & transport
• Receiving the raw materials
• Invoicing 
• Purchasing 

4. Commissioning Function 

• After Sales Service
• Testing & Commissioning 
• Modernization of plants 

What are the Characteristics of EPC Projects?

Customers or clients use EPC contracts to send schedules and risk costs to EPC, which helps in hiring contractors through an arrangement or contract called a Lump Sum Key (LSTK). The term lump sum amount refers to an agreement in which the customer pays the builder a lump sum amount (also known as fair wage). There is another term known as "turnkey" which means that the provided resource must be operational immediately upon delivery. 

The work schedule is also specified in the contract, and it is agreed that EPC employees must complete the work by the deadline specified in the contract. It is made to make sure that the management team working on the construction site is monitored by the EPC contractor and that the work is going according to the design made. And in some special situations, contractor suggestions are also taken into consideration to make it better and more attractive.

Important Features of a Good Contract

Mentioned below are some important features of a good contract 

• The legitimacy of the law should be maintained
•  Important conditions should be incorporated 
• Definitions should be clear
• The project design should be attractive 
• The contract must be fair and according to the client
• The responsibility and risk of the contract should be taken by the Contractor or any individual should be responsible and reliable.
• Both contractor and client should acknowledge the contract 

What are the Fundamentals of EPC? 

The contract or agreement should be in written form and should be done on priority. The contract should be very precisely prepared which includes all terms & areas of affairs of the main exercise. If the project includes two or more workers for hiring, chipping the reach should be reflected with the division of extension, during that situation, the takeoff points and motive should be referred. The most important thing is that the contact should not be complex in nature.

Important Components of EPC Contract

• Risk Distribution: The contract should specify how parties will share the risks. The possible risks include delays in the project, the budget going high, and more.
• Quality Control: A well-explained EPC contract should have clearly explained standards which consist of monitoring and reporting the progress of the project.
• Performance Guarantee: The contract should also include a performance guarantee which includes a warranty or guarantee of installed products or equipment. 
• Conflict Resolution: The contract should also specify if any conflicts arise between parties it will be resolved by mediation or legally.

Best Examples of EPC Projects

Below listed are some best and most popular examples of Engineering, Procurement, and Construction (EPC full form) projects  

1. Mt. Milligan Copper-Gold Project: It is a conventional truck shovel open pit that consists of copper and gold mines. The Project is located in Central Columbia, Canada. 
2. Diavik Diamond Project: It is a diamond mine which is situated in the North Slave region of Canada. 
3. Solar Power Project: It is a solar plant constructed on the roof of a hospital located in Indore, MP.

Popular Indian EPC Companies

Listed below are some popular Indian EPC companies  

• Larsen & Toubro Limited
• Tata Projects Ltd
• Gayatri Projects 
• Gammon India
• Patel Engineering Ltd.
• Era Infra Engineering
• Mcnally Bharat Engineering 
• IVRCL
• Sadbhav Engineering Limited
• Hindustan Construction Co. Ltd 

Some Important Facts about EPC

• The contractor & client explain each stage in depth to get work completed as per the client's requirement.
• After signing the contract, the contractor has to maintain the cost according to the budget and the project gets completed within the deadline. 
• The EPC, full form of which is Engineering, Procurement, and Construction, contractor is responsible to complete the construction as per the conditions included in the Lump Sum Turnkey(LSTK) contract.

Written By: Deepit Mathur