Qcn 2 2 february2015 web

INTERVIEW: Lars Erik Forsbergh, president, Volvo Trucks Middle East, on Qatar’s truck market – PG. 32

issue 2.2

February 2015

STREET SMART:

Can improved road designs reduce accidents in Qatar?

Qatar’s

RISING CoSTS Causes and repercussions of the construction inflation spectre

PLUS:

Contractors’ right to clearer provisions for time extension

TECHNOLOGY

Considerations to resolve conflicts between drawings and BIM models

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contents FEBRUARY 2015

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Cover Story What are the factors leading to increasing construction inflation Qatar’s in Qatar, and what might be their repercussions? How do the oil price dip and the 2022 World Cup impact Qatar’s construction inflation today and into the future? In an exclusive interview with QCN’s Farwa Zahra, Terry Tommason, partner and general manager at EC Harris in Qatar, answers these questions.

INTERVIEW: LARS ERIK FORSBERGH, PRESIDENT, VOLVO TRUCKS MIDDLE EAST, ON QATAR’S TRUCK MARKET – PG. 32

issue 2.2

February 2015

STREET SMART:

Can improved road designs reduce accidents in Qatar?

RISING CoSTS CAUSES AND REPERCUSSIONS OF THE CONSTRUCTION INFLATION SPECTRE

PLUS:

Contractors’ right to clearer provisions for time extension

16.

24.

TECHNOLOGY

Considerations to resolve conflicts between drawings and BIM models

Regulars With Dubai Expo 2020 and a number of infrastructure projects underway across the Gulf region, the growing pressure to procure and retain labour force will drive the rate of construction inflation.

(Image Arabian Eye)

26.

From the Editor - 6 Construction News - 8 Guest Column - 14 Legal - 38 Qatar Tenders - 40

32.

Technology Resolving conflicts between drawings and BIM models

feature story Making qatar’s roads safer through improved designs

Interview All major truck players are in Qatar as it is a booming market

Building Information Modelling (BIM) is frequently used alongside hard copy drawings. To effectively deal with inconsistencies between BIM models and drawings, Gabriel Olufemi and Paul Prescott of Pinsent Masons highlight some contractual considerations when using BIM on a future project.

Of the total number of deaths, 14.3 percent of fatalities in Qatar correspond to road crashes. Carlos Riera Planells of Ashghal looks into the current design features of Qatar’s roads, while suggesting engineering solutions to improve their safety standards in the future.

Qatar’s growing truck numbers to a large extent come from its booming construction market. Discussing some latest trends and challenges in Qatar’s truck market, president of Volvo Trucks Middle East, Lars Erik Forsbergh shares the company’s competitive strategies to match the local market needs.

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editor’s letter Earlier this year, Qatar Petroleum and Royal Dutch Shell called off plans to pursue their USD6.4 billion (QAR23.3 billion) joint petrochemical project in Qatar. Originally conceptualised to be the second largest petrochemical project in the Gulf Cooperation Council, the decision to shelve Al Karaana came amid the ongoing dip in oil prices across the world.

While the volatility in oil prices is linked to changes in overall price levels across most international trade markets, countries such as Qatar are some of the most affected at present. With hydrocarbons contributing the largest chunk to Qatar’s economy, leading oil and gas companies here have initiated cost cutting to deal with the challenge.

If the plunge in oil prices continue, some key construction projects are likely to get deferred or cancelled, potentially easing pressure on the overall demand for materials and labour.

On the surface, a plunge in oil prices is not related to the construction sector. This, however, is not true considering the role of the oil and gas sector in supporting Qatar’s construction boom. While construction and infrastructure projects directly linked to the oil industry are more likely to face the repercussions in the form of delays or cancellations, other projects are not completely removed from the effects either.

One such impact would be the more active role of the private sector in supporting construction projects, a trend which also translates into the increasing importance of project financing in the region.

According to EC Harris’ latest construction cost report titled International Construction Costs Report: What will it mean for 2015?, published in January, Qatar is the most expensive country for construction in the Middle East. If the drop in oil prices continues, the resulting deferment and cancellation of large-scale projects can potentially ease pressure on supply chain bottlenecks and the overall demand for materials and labour.

Ironically, this means that at the cost of some projects suffering, other projects in Qatar will benefit from suppressed construction inflation. Projects benefiting from this likely trend would mainly include those

set against a fixed deadline, for instance the projects linked to the 2022 World Cup. In our cover story Rising Costs on page 16, Terry Tommason, general manager at EC Harris in Qatar and director for the buildings sector across the Middle East, answers some questions about the causes and repercussions of Qatar’s increasing construction costs, and the role of the oil and gas sector and the 2022 World Cup on Qatar’s construction inflation and other related aspects linked to the sector.

While the depressed oil price in some cases is making the investor community more cautious of their stakes in the region, many analysts in the oil and gas sector are suggesting that the plunge in oil prices is only going to leave short-term impacts on Qatar.

Furthermore, Qatar’s Minister of Finance HE Ali Shareef Al Emadi has assured that the ongoing dip in oil prices will not affect the country’s fiscal policy on spending or investment in infrastructure. Effectively, this means that the current trend of simultaneous deadlines for key projects, supply chain challenges and increasing demand for necessary resources is here to stay.

On a positive note, this also means that the government-backed projects will follow their regular pace. Of these projects, one relates to the improvement works of Qatar’s road system and development of new roads for smooth traffic flow. A major consideration in these works is looking at the safety aspects of road designs. On page 26, Carlos Riera Planells of Ashghal discusses some safety considerations for designers and engineers to make Qatar’s roads safer for drivers, bikers, and pedestrians.

For more on the sector, Qatar’s truck market and some legalities involved in project delays, continue reading.

Farwa Zahra Editor

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Construction 8

section

News

Qatar’s new Maldivian-style resort welcomes its first guests Inaugurated in January this year, Banana Island Resort by Anantara – a Maldivian-style resort – welcomed its first paying guest on January 2, 2015. The Anantara brand was born in Thailand and is renowned worldwide. QCN approached Elias El Khoury, director of sales and marketing, Anantara’s Banana Island Resort, who shared details of the hotel’s key features.

Guests can also book a 10-minute helicopter flight directly from the airport 24 hours in advance at an additional cost.

February 2015 | QCN

construction news

Located at the crescent-shaped Banana Island, Anantara’s Banana Island Resort features 141 rooms.

(Image Anantara)

9

Featuring 141 rooms, suites, pool villas and over-water villas, Qatar’s latest resort has been established across the entire island located about 20 minutes away from Doha.

According to Elias El Khoury, director of sales and marketing for Banana Island Resort by Anantara, transfers to the resort are being facilitated through a boat ferry from the Al Shyoukh Terminal located on Doha’s Corniche. Alternatively, guests can also book a 10-minute helicopter flight directly from the airport 24 hours in advance at an additional cost.

While the resort’s overall design is inspired from Maldivian-style resorts intertwining with Thai and Qatari hospitality, El Khoury explained that the rooms are designed to reflect Arabian luxury. Of 141 rooms, 54 are premier sea view rooms, 16 deluxe sea view rooms, eight sea view suites, 18 Anantara suites, and 34 spacious sea view pool villas featuring a personal pool and poolside cabana. The eight two-bedroom over-water villas and trio of three-bedroom over-water villas offer 360 square metres (sqm) of space and a 62 sqm personal pool, designed for families and groups of friends.

“From the external facades to the interior design, the traditions and history of the region were taken into consideration and embraced as a core value of the development. The resort has been designed in splendid Arabian style incorporated with the Maldivian look and style,” added El Khoury.

When asked about the comparison of Banana Island Resort with Qatar’s existing resorts, El Khoury said, “Each Anantara hotel and resort draws its strength from the rich cultural traditions, historic heritage and natural beauty of its destination.

As such, every experience is a unique voyage of discovery and inspiration that is distinctly Anantara but also embraces the local Qatari culture.”

Other facilities at the resort include a private marina, 800-metre private beach and dive centre, while leisure amenities range from a 100-metre long lagoon pool, children’s pool with water slides and a surf pool, to a wide range of water sports, beach games and fitness activities. The resort’s entertainment centre features 10pin bowling, nine-hole putting golf course and a cinema. The resort also features eight restaurants, which offer Middle Eastern, Asian, Italian, Mediterranean and other cuisines.

QCN | February 2015

Construction

News

Industry Views

QCN approached a number of professionals to ask about some of the most attractive upcoming projects in Qatar. Here is what they had to say:

among the most attractive mega projects being rolled out in qatar Amphibious 1000

There are a host of exciting new and launched projects in Qatar. Projects here are often shrouded in speculation and rumour, but with time constraints, the wider public scrutiny and political impetus, there is every real chance that these projects will be finished.

For companies with a healthy risk appetite, the mega projects being rolled out in Qatar include the Doha Metro, Sharq Crossing, the Amphibious 1000 and various oil and gas projects.

The reduction in the price per barrel of oil is unlikely to greatly

impact Qatar’s ability to progress these mega projects, and contractors can find some comfort in knowing that their employer has sufficient cash to meet its obligations. This makes Qatar an attractive place to do business.

Being involved in high profile, prestigious and unique projects also often heightens a contractor’s reputation and its own marketing profile. However, it is essential, like in any bidding process, that contractors are aware of the risks arising from doing business in any developing market.

Laura Warren is the partner of Projects & Construction at Clyde & Co.

“The rail and port projects are most attractive as they are essential infrastructure required to help Qatar continue to grow and flourish.”

“Qatar Rail projects look attractive not only because of the multibillion dollar spend, but also because these projects have had very rapid mobilisation.”

“The construction market is split into infrastructure and property, both sectors are delivering [projects] contributing to the development of Qatar.”

“The projects supporting Qatar’s long-term sustainable national development are the most attractive and that is where we can add most value.”

Scott Lambert, regional head of Construction & Infrastructure, Al Tamimi & Company, adds that all transport infrastructure are key drivers to any economy.

After transport projects, he says, projects related to the 2022 World Cup such as the stadiums are of key importance as they will be an opportunity for Qatar to present itself to the world with innovative design.

Manfield Mandigora, assistant director of Infrastructure & Capital Projects, Deloitte Qatar, adds that projects’ rapid mobilisation provides comfort that they are being well managed compared to some public projects, which have suffered from bad publicity due to delays. Ashghal, he adds, is reviewing its form of contract, which will likely result in making Ashghal projects more attractive.

Among the attractive projects, Mark Rudman, Faithful+Gould’s country manager, mentions World Cup stadiums, Lusail city, the Pearl-Qatar, Msheireb Downtown, Doha Metro, Supreme Committees of Health and Education programmes, and some projects of Ashghal and Kahramaa. With development, these projects, he continues, also give rise to massive supply chain challenges.

Peter Murphy, managing director, Quantum Global Solutions, says that these projects are phenomenal in terms of scale, complexity, prestige and nature of the works. The number and variety of projects currently underway in Qatar, he says, is unprecedented not only in preparation for the 2022 World Cup but also to achieve the Qatar National Vision 2030.

February 2015 | QCN

construction news

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Qatar to house one of largest entertainment centres in the Gulf Megapolis, a 5000-square metres family entertainment centre, is set to open in Medina Centrale at the PearlQatar in March. Claimed to be the biggest indoor entertainment centre in the region, Megapolis will combine a multitude of entertainment venues ranging from arcades and indoor attractions such as golf, bowling, snooker, billiard and darts, to hightech 3D and 5D games, karaoke and an active sports zone. Food and beverage services at the facility will feature five eateries – Saladworks, Earl of Sandwich, Cool de Sac, Camille’s Ice Cream and Mister Pizza.

square metres, to launch a series of food and beverage concepts in addition to Megapolis.

Food and beverage services at Megapolis will include five eateries.

In March 2014, United Development Company, the master developer of the Pearl-Qatar had signed a lease agreement with Palma Hospitality Group, covering a total area of 7000

FEBRUARY’s big number USD

280

Qatar’s construction projects are currently estimated in excess of USD280 billion (QAR1.02 trillion), according to Ventures Onsite’s Middle East & North African Countries Construction Projects Tracker. Of the total estimated worth, projects linked to infrastructure development make up USD103.4 billion (QAR376 billion) while the energy-related projects are worth USD40.3 billion (QAR146.7 billion).

Indoor attractions at Megapolis will include golf, bowling, snooker, billiard and darts. Pictured here is the billiard room of the facility.

Ashghal celebrates 30 million man-hours without loss time injury

billion Key recent contract Awards

awarded in Qatar Barwa Real Estate Group has signed a contract with Erga Qatar Architectural & Engineering Consultants, which marks the first steps of executing the second phase of Dara project. The project will be developed into the largest residential project in Fox Hills, Qatar, covering over 147,000 square metres. As per the contract worth approximately QAR88 million, Erga Qatar will conduct

the design and supervision works of the second phase of Dara project.

The design and supervision phases will proceed in tandem. The design phase will be implemented over two years, while the supervision and implementation will be done over three years. Works on Dara (BF) will be divided into nine phases over three years starting from September 2015 until September 2018.

Representatives from Ashghal Expressway Programme and relevant partners attended the award ceremony held to celebrate 30 million man-hours without loss time injury.

The Public Works Authority (Ashghal) and the joint venture of Consolidated Contractors Company and Teyseer Contracting Company working on Dukhan Highway Central expressway project achieved 30 million man-hours without loss time injury (LTI). The milestone builds on the previous achievement of 25 million manhours without LTI celebrated by Ashghal and the contractors in July 2014.

An awarding celebration was held at the Public Works Authority headquarters to mark the milestone.

QCN | February 2015

Construction

News Events 11 - 12 FEBRUARY

2- 4 March

Offshore Specialized and Construction Vessels Summit

Gulf Aluminium Casthouse Conference

22 - 24 FEBRUARY

10 - 11 March

11 - 13 May

Cityscape Qatar

Sharq Village & Spa

Qatar Projects FaCade Design & Engineering Middle East Conference Grand Hyatt Doha InterContinental Doha

1 - 3 March

24 - 26 March

18th Gulf Engineering Forum

Qatar Pool & Spa Expo

Qatar Society of Engineers in collaboration with the Public Works Authority (Ashghal) has announced the 18th Gulf Engineering Forum and Associated Exhibition under the theme of infrastructure projects in the GCC. To be held at St. Regis Hotel in Doha, the forum is expected to see participation from prominent decision-makers, senior officials from public and private sectors, eminent engineers from the region, as well as major consultancy firms, contracting companies, and engineering institutions.

The 18th edition of the Gulf Engineering Forum was announced by senior representatives of Ashghal and Qatar Society of Engineers.

February 2015 | QCN

Cityscape Qatar provides business and networking opportunities for real estate companies. Pictured here is an image from the event’s 2014 edition.

Doha Exhibition Center

27 - 28 April

qatar green building conference 2015 Qatar National Convention Centre

6 - 7 May

Future BIM Implementation

Marked by the rise in construction and development that Qatar is currently going through, interest in implementing Building Information Modelling (BIM) is rapidly growing.

The Future BIM Implementation conference will bring together the government authorities responsible for infrastructure developments, project owners, consultants, project managers, main contractors, subcontractors, BIM experts and BIM technology providers to showcase examples of BIM implementation.

Considered as one of largest real estate events in Qatar, Cityscape Qatar will return this year from May 11 to 13. To be held at Doha Exhibition Center, the event will feature a conference and exhibition where businesses from across the world will have a chance to display their products and highlight their services, providing a line-up of opportunities for the regional real estate community. The event provides networking opportunities with regional and international real estate investors and financiers, developers across all asset classes, architects and urban planners, consultants, representatives from investment and economic agencies and cities.

18 - 21 May

World Stadium Congress Grand Hyatt Doha

construction news

Green

technologies

showing highest potential over the next five years in the GCC RANK 3 RANK 2

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SOLAR

WATER TECHNOLogiES

ENERGY EFFICIENCY/ GREEN BUILDINGS

expected growth of solar panels in the gcc construction industry Commercial Rooftop

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wind technologies

WAste management

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Source: EY’s 2014 MENA Cleantech Survey

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24% 5% 9% Industrial Rooftop

Utility Scale

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Residential Rooftop

QCN | February 2015

14

sectioncolumn guest

Recycling in Qatar’s construction industry Qatar heavily relies on imported materials to meet the needs of its ongoing construction activities.

Dr. Khaled Hassan of TRL shares insights on transforming construction waste into building materials.

Dr. Khaled Hassan is the regional manager for TRL’s Middle East operations. He has 24 years of experience in construction materials, pavement, standards and specifications and the use of recycled materials in construction.

February 2015 | |QCN QCN

A number of large-scale infrastructure projects underway in Qatar are facing a shortage of locally-manufactured materials of high quality, thus relying on imported aggregates for use in asphalt and concrete applications. At the same time, large quantities of construction and solid wastes are generated and sent to landfill sites.

To help overcome this problem, a project on the ‘Innovative Use of Recycled Materials in Construction’ was awarded to a group of stakeholders including TRL with its collaborative partners of Qatar Standards, part of Qatar’s Ministry of Environment, Public Works Authority (Ashghal), and Qatar University in 2011. The three-year project, which focuses on transforming waste materials into building materials, is funded by the National Priorities Research Program (NPRP), which is administrated by the Qatar National Research Fund (QNRF) at Qatar Foundation.

Innovative Use of Recycled Materials in Construction is in line with Qatar government’s policy on sustainable development and protection of the environment as mentioned in the country’s national vision.

Aimed at overcoming the shortage of locally available aggregates and promoting green construction in Qatar, the programme resulted in the identification of recycled aggregates from excavation waste (EW), and recycled concrete aggregate (RCA) being sourced from a landfill site at Rawdat Rashid. Considerable quantities of recycled aggregate were also identified in Qatar that could make a significant contribution to the demand for aggregates in various construction applications.

Comprehensive laboratory testing was carried out to identify the optimum use of EW and RCA as unbound pavement materials and coarse aggregate in structural concrete, non-structural concrete and

concrete blocks. The selected optimised mixtures were then used in the construction of full-scale site trials (buildings and roads) to demonstrate how to apply the new recycled materials and mixtures in practice.

The trials were monitored in service for a minimum of one year under normal exposure conditions such as heat, humidity, aggressive ground conditions, and heavy trafficking, and the results were used to update the Qatar Construction Specifications (QCS 2014) and promote green construction of buildings and roads.

Consequently, the latest edition of the QCS, published in 2014, permits the use of recycled aggregates from EW and RCA as coarse aggregate in concrete at up to 20 percent replacement of imported gabbro for structural concrete and up to 50 percent for non-structural concrete.

Recycled aggregates are also permitted up to 100 percent in sub-base applications.

Similarly, excavated limestone waste is permitted as aggregate in asphalt in the lower layers of the pavement, but not in the surface course.

The recycled aggregate materials are supplied by Qatar Quarry Company – Lafarge; the building trials are constructed by the Qatari Arabian Construction Company (QACC); and the trial road is constructed

by Boom Construction Company. In fact, a key success of the project has been the collaboration between government, industry, research and academia, all of which supports the government objectives of sustainable development and green construction.

It is expected that the use of recycled aggregate will yield major economic and environmental advantages when compared to the use of imported aggregate. A comparison of the likely costs of local recycled aggregates in Qatar indicated a significant reduction of 60 percent

Website Launch AD- Half vertical page.pdf

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In addition to improving the aggregate supply chain, the use of local recycled aggregates reduced the carbon footprint by at least 50 percent mainly due to the energy saving in transport. compared to imported aggregates.

In addition, the use of local recycled aggregate reduced the carbon footprint by at least 50 percent mainly due to the energy saving in transport that can be avoided in shipping the primary aggregates to Qatar. Limitations on port capacity and concerns about the quality of imported aggregate would also support greater uptake of the recycled materials in construction.

The implementation of recycling in construction on a large scale would require significant changes to the existing construction practices in Qatar. Codes of practice have been developed for sorting out wastes at source before sending to landfill and certifying recycled aggregate by Qatar Standards. These will significantly improve the quality of recycled materials, provide confidence in use, and change the perception of inferior quality of recycled materials.

Guidance documents have also been prepared to provide experience on the use of recycled aggregate in different construction applications.

Recently, another project has been awarded in Qatar for the implementation of recycled aggregate in real construction projects. The new project will look at the performance of recycled aggregate in a range of construction applications and monitor performance in practice. The project team will work with a wider group from the government and construction industry to provide sustainable aggregate. The results will be publicised to ensure the stakeholders are aware of recycled aggregates and have confidence in their use.

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QCN | February 2015

Rising c Causes and Repercussions of Qatar’s Construction Inflation

costs In a recent report reviewing construction costs across the world, Qatar has again emerged as the most expensive country in the Middle East and North Africa. What are the factors leading to increasing construction inflation in Qatar, and what are their repercussions? What are the roles of oil price dip and the 2022 World Cup in driving Qatar’s construction inflation today and into the future? In an exclusive interview with QCN’s Farwa Zahra, Terry Tommason, general manager at EC Harris, an Arcadis company, in Qatar and director for the buildings sector across the Middle East, answers these questions.

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I

n January, the global built asset consultancy firm EC Harris announced its latest construction cost report. Titled International Construction Costs Report: What will it mean for 2015? the report analysed 43 key construction markets in terms of costs. In this context, Switzerland and Denmark have emerged as the most expensive markets, while India takes the last slot, indicated as the cheapest country for construction. Overall, Qatar takes up the 17th place in the list. The country also emerged as the most expensive market within the Gulf Cooperation Council (GCC) and the wider Middle East and North Africa (MENA) region. Just above Saudi Arabia is the United Arab Emirates (UAE), two slots below Qatar, at 19th.

In the Arcadis 2012 report Qatar: Avoiding the Inflation Bubble, it was forecasted Qatar’s construction inflation could reach 18 percent between 2016 and 2019. However, in a more recent study titled Second Global Infrastructure Investment Index 2014, Arcadis’ analysts have expressed a possibility of construction inflation rate reaching up to 20 percent during the same period.

On the expected level of construction inflation within 2015, Terry Tommason, general manager at EC Harris Qatar and director of buildings sector in the Middle East indicates a rate between eight and nine percent. “According to our EC Harris reports, we forecasted that at peak levels of activity, and without appropriate mitigating actions, there is a risk that inflation over the period of 2016 to 2019 could reach 18 percent per annum, but in 2015, Qatar construction inflation is forecasted to reach eight to nine percent. This could, however, be suppressed by the price of oil and the ongoing spending reviews depending on how long it takes for the volatility to stabilise.”

perspective,” adding that in general, GCC countries such as Qatar have historically been massively challenged by peaks in construction activity as a consequence of bottlenecks in accessing materials and labour. However, the issue, according to Tommason, is now exacerbated by the recovery in the UAE market and Saudi Arabia’s aggressive social infrastructure aspirations. “Global demand for the best resources and base construction materials is also increasing and serves as a reminder that Qatar is not alone in its challenge to deliver large and complex programmes of work,” he says.

Arguably, Doha’s old port’s limited capacity is often considered as one of the sources of escalating costs, by creating supply chain bottlenecks leading to project delays and postponement costs. Tommason believes that the new Doha port’s development in south of Doha and north of Al Wakrah is a crucial infrastructure project that will help to address the current inbound logistics issues for bulk materials and containerisation.

“Once planned capacity comes on stream in 2016,” says Tommason, “the flow of essential construction materials will become less susceptible to delay and demurrage costs as well as alleviating pressure on the existing and congested Doha Commercial Port and MIC Port.”

However, Tommason continues that even if the new port is commissioned on schedule, the planned rate of construction expansion still outstrips the capacity of the port during the predicted peaks of demand. Unless measures such as the use of temporary jetties or alternative access via Ras Laffan or Ruwais are implemented, bottlenecks with the inbound logistics on all the existing entry points will still be a cause of cost and delay.

Causes Qatar’s ranking as the most expensive country for construction in the region is not a new phenomenon. In fact, the country has held this regional position since 2013. Speaking about some key reasons behind this trend, Tommason says, “Qatar is a small country relative to its planned expenditure on built assets. It has the need to import much of its materials and labour, and is constrained from a logistics February 2015 | QCN

Doha Metro is one of Qatar’s key mega projects that will also provide necessary transport infrastructure for the 2022 World Cup and beyond. Pictured here is a site of Doha Metro near Sports Roundabout. (Image Avi Viljoen/Flickr)

cover story

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With extensive experience across the Middle East, Terry Tommason leads EC Harris’ major programmes and projects across Qatar and the Gulf Cooperation Council.

Repercussions Emanating from varied causes, Qatar’s ongoing construction inflation is bound to affect a number of stakeholders. When asked about aspects most affected by cost escalation, Tommason says, “The biggest impact on construction cost in Qatar and the Gulf is derived from the cost of the materials which are dependent on the prices of the commodities (such as metals) that make up this quantum. Labour, whilst less significant, is an important component and the ability to get skilled labour into the Middle East will continue to face big challenges.”

Effects on contractors: For key stakeholders such as contractors and subcontractors, the principal impact will be the constraints it places around their own supply chains, according to Tommason. “Securing resources and materials with a view to locking them down for the construction duration against a fixed price will not be for the faint hearted,” he says, explaining that competition for resources and materials will be intense and contractors

Qatar National Vision 2030 requires unprecedented investment across all market sectors that has fuelled the inflation challenge for the country, says Terry Tommason of EC Harris.

“The inflation challenge in Qatar will unquestionably compound as we near the 2022 World Cup.” - Terry Tommason, general manager, EC Harris, Qatar.

QCN | February 2015

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cover story

“The biggest impact on construction cost in Qatar and the Gulf is derived from the cost of the materials.”

Qatar is heavily dependent on imported construction materials.

(Image Arabian Eye)

February 2015 | QCN

are unlikely to bear the burden of the risk as they have done to date. The trend will drive changes in how clients currently select and engage contractors since the likelihood is that contractors will either no-bid or heavily risk-price their tenders as the market warms. “Successful contractor engagement by clients is therefore crucial to ensuring that Qatar is ready for 2022 and will require a quantum leap in trust and approach from all parties concerned,” adds Tommason.

Effects on investors: According to Arcadis’ Second Global Infrastructure Investment Index 2014, Qatar is the second most attractive country for infrastructure investment after Singapore. However, with construction becoming more expensive, will there be a shift in investor sentiment over the coming years? Tommason believes that overseas investors have historically been cautious of Qatar and the GCC due to opaque market conditions and real estate laws and regulations.

“The inflation challenge in Qatar will unquestionably compound as we near the 2022 World Cup, and we expect that most investors will be keen to mitigate their exposure by forward planning around their supply chain and starting their projects sooner rather than later,” Tommason advises the investors to choose their targets very diligently during these years ahead and to have a clear route of entry and exit with a robust risk plan.

Effects on projects: While the risks of construction inflation are there for key stakeholders, ultimately, the challenges will potentially reflect on the progress of the ongoing projects, particularly those linked to oil and gas companies already facing cost cutting amid falling oil prices in the international market. Tommason says, “The highest risk will be the overlap between a number of large-scale and essential programmes all of which will be required to fulfil the 2022 World Cup facilities and infrastructure requirements, creating a peak in construction activity over the next two to three years. As this activity is dependent upon the capacity of local supply chains, there is a real risk of the market’s failure to supply.” Further programme smoothing at a national level through the prioritisation and deferment of work should be considered to mitigate this, he adds.

Oil price dip and Qatar’s construction inflation According to the latest Business Optimism Index-Qatar, the country’s construction sector showed the highest ranking among non-hydrcarbon sectors. But with hydrocarbon resources driving a large part of Qatar’s economy, can the construction sector stand independent of the oil and gas sector? And, is there any significant relationship between the ongoing dip in oil prices and Qatar’s construction inflation?

On the future trending of the oil price in the region and the impact that any protracted volatility will have on the market, Tommason says, “Currently we are witnessing increased levels of concern from many clients across the region particularly within the public sector where funding is tuned into oil and gas revenues. We have examples of projects being deferred and in some cases being cancelled. If this trend continues, it will reduce the demand for resources and materials in the region which will to some degree, suppress the rate of construction cost inflation for a limited period.”

Nonetheless, in the case of Qatar, he believes this impact is more likely to be short-termed as the 2022 World Cup deadline is immovable with major projects that are critical to the tournament. “This is not just about stadiums, it is about delivering some of the largest infrastructure

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To attract and retain construction labour force, Qatar will have to invest in better living and working facilities. This will effectively increase the overall cost of construction in the country.

(Image Arabian Eye)

A major driver of Qatar’s construction inflation is the cost of materials. (Image Arabian Eye)

active role in the financing and delivery of these major projects across the Middle East, moving into 2016 and beyond,” says Tommason.

Construction cost projections

Terry Tommason says that if the oil price dip continues, it will reduce demand for resources and materials in the region, which will, to some degree, suppress the rate of construction cost inflation for a limited period.

and building projects in the world to facilitate the greatest show on earth.

Hence, I’m afraid the challenge of inflation is not going to disappear anytime soon in Qatar although it may take slightly longer to bite deep,” explains Tommason, adding that despite no chance of substantial effects, “investors will be inevitably cautious around the regional market due to the oil price projections until such time as the situation stabilises.”

The oil price dip can potentially impact project financing. According to Tommason, in Qatar, much of the capital sourced for government programmes is leveraged from oil and gas revenues and governmentbacked banks but private developers typically leverage debt from the financial sectors. Hence, the risks in this regard can become extremely volatile and increase exponentially in markets that are heating up and becoming unpredictable. “If the oil price remains low for the first half of this year, the probability will be that the private sector will be called upon to take a more

More factors in the future are going to compound Qatar’s construction inflation.

With Dubai Expo 2020 and a number of infrastructure projects underway across the region, the growing pressure to procure and retain labour force will drive the rate of construction inflation. Stated differently, if skilled labour needs to be hired and retained, the sector will inevitably require a competitive edge over other regional markets. This competitive edge may take the form of higher salary, improved accommodation and more perks attached to the overall package.

Explaining this phenomenon, Tommason says, “Qatar is in competition with other mega programmes within the region and across the world. Worker health, safety and welfare issues will increasingly be under scrutiny as the spotlight of the World Cup increases and as improvements are made, this should help to attract and retain workers.” Elaborating on the effects of the initiatives on construction inflation, he continues, “Whilst the investment in significant improvements to working conditions is welcome, this will also be a factor in driving construction costs.

Since a significant part of Doha’s ongoing construction activities come as QCN | February 2015

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cover story

Qatar’s future trends linked to construction inflation Qatar’s construction inflation likely to reach up to 20 percent between

2016 and 2019.

Possible cancellation of projects backed by the oil and gas sector due

to the ongoing dip in oil prices

Increased role of private sector in case of a

continued dip in oil prices

If the oil price dip leads to suppressed construction costs, projects with immovable deadlines will benefit from the trend. Pictured here is a construction site in Doha’s West Bay. (Image FotoArabia)

Stiffened competition for labour leading to increased cost to hire and

retain skilled labour

Increased competition for material procurement, leading to a rise in

international prices

Improved facilities for labour, Immovable increasing deadline for the the overall 2022 World construction Cup to contribute towards costs construction inflation

Contractors preference for no-bid

or heavily riskpriced tenders

Contractors to secure materials by locking them at a fixed price

over the project’s duration

Construction expansion likely to outstrip the capacity of the new port

Client’s preference

during the predicted peaks of demand

for turn-key contractors

Increased chances of delays in projects due to the above reasons

February 2015 | QCN

a result of Qatar’s winning bid for the 2022 World Cup, speculations about slowed down construction post2022 suggest changes in the cost of construction here. In contrast to the common viewpoint that the World Cup is a major influencer behind increasing construction costs, Tommason says, “The World Cup is not necessarily the primary driver for construction cost inflation ‎in Qatar. The challenges were comparable in the lead up to the 2006 Asian Games in Doha and subsequent real estate boom. The 2030 vision for Qatar has required unprecedented investment across all market sectors and has fuelled the inflation challenge.”

“As Qatar relentlessly strives towards completing its 2030 Vision I would anticipate the country to continue to face inflation challenges in the years ahead as it invests heavily in construction projects that develop its infrastructure for future generations post-2022. This is the beginning of that journey and certainly not the end,” Tommason concludes.

advertorial

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Dubai construction sector contributed 7.89% to Dubai’s GDP in first half of 2014: Dubai Statistics Centre report International Property Show 2015, Middle East’s Biggest Property Sales Event in Spring: “Retailer demand is fuelling the construction sector”

Dubai, UAE, 30th March to 1st Apil 2015: The construction sector contributed 7.89% to Dubai’s Gross domestic product (GDP) in the first half of 2014, according to the latest report from the Dubai Statistics Centre.

The figures were brought into the spotlight by the organisers of the International Property Show while announcing the biggest edition of the event to be held from 30 March – 1 April 2015 at the Dubai International Convention and Exhibition Centre.

Strategic Marketing & Exhibitions, organisers of International Property Show, said that the event was designed to help promote the sector to international and regional investors, decision makers and trade and retail visitors coming from around the world. The organizers expect endusers, property retailers and small budget investors to conclude attractive deals on the exhibition floor over three days.

“The fact that the construction sector contributed 7.89% to Dubai’s AED 170.7 billion GDP in the first half of 2014 demonstrates the dynamic growth potential of the Emirate’s real-estate industry and related sectors,” said Josine Heijmans, Exhibition Director, Strategic Marketing & Exhibitions. “We believe this is partially linked to the booming retail segment.”

Heijmans added: “It gives high levels of confidence for trade visitors when they know that the exhibition’s main partners include The Real Estate Regulatory Agency (RERA), Dubai Land Department (DLD) and Dubai Real Estate Institute (DREI), as well as other strategic partners such as the Association of International Property Professionals (AIPP) and the Royal Institution of Chartered Surveyors (RICS).”

International Property Show helps to find the right fit for retailers according to their needs and price range. The show organisers’ deep understanding of the market dynamics and economic conditions, as well as business and investment trends, enables them to produce a first-class event.

Heijmans added: “We are fully equipped

to better serve our retail clients backed by our market insight, valuable connections and up-to-date retail property information.”

The exhibitors at International Property Show will offer services like commercial real estate sales, leasing, consulting, relocation & expansion assistance, retail space utilization and efficiency consulting, asset acquisition and disposition in addition to a broad range of residential real estate services which will also be on offer at International Property Show.

The 2015 edition will take place at the Dubai International Convention and Exhibition Centre, with free entry to the public.

QCN | February 2015

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technology

Resolving conflicts b

drawings and BIM m Building Information Modelling (BIM) is frequently used along hard copy drawings. Any inconsistencies between BIM-facilitated models and hard copy designs can lead to significant complications.

To effectively deal with such inconsistencies, Gabriel Olufemi and Paul Prescott of Pinsent Masons highlight some contractual considerations when using BIM.

Building Information Modelling (BIM) is being used with increasing frequency on some of the major infrastructure projects in Qatar. For those unfamiliar with it, BIM is the digital representation of a project from concept design through to construction and operation. It is useful for designing, pricing, programming, coordinating, integrating and sequencing work activities and helps to identify potential clashes between items of work. It is a valuable tool in the project lifecycle and may help to avoid significant cost overruns.

If BIM is used on a project, hard copy drawings may continue to be used by the design team. Difficulties may, therefore, arise if there are any inconsistencies between the drawings and BIM models.

For example, the drawings may show different dimensions or layouts to the configurations on BIM models.

There are some key contractual concerns to consider when using BIM on a future project.

BIM at tender stage It is common for bidders to be issued with BIM models and drawings as part of the tender documents. If there are inconsistencies between the two, bidders may not know which to use to determine the correct quantities to calculate the February 2015 | QCN

tender price.

Employers must ensure that BIM models and drawings are consistent at tender stage. The tender documents should also clearly indicate the document or model, which would take precedence if there were any inconsistencies between them. If bidders do identify inconsistencies and there is no ‘priority of document’ clause in the general conditions or they make no reference to BIM models, bidders should, ideally, raise a tender clarification. In any event, bidders should always bring an inconsistency to the attention of the employer to avoid problems post contract award.

Some design and build contractors may have challenges getting their supply chain to use BIM – usually due to lack of expertise or the increased cost of recruiting a BIM manager.

technology

between

models

BIM at contract award The contractor’s obligation is to execute the works in accordance with the design documents. If hard copy drawings are included in the contract documents, there may be inconsistencies between the drawings and BIM models. Disagreements may arise as to the extent of the scope of works under the contract (that is, whether the contractor is required to execute the works in accordance with the drawings or BIM models if there are inconsistencies between them).

While contracts usually contain a ‘priority of documents’ clause, they do not always identify which ‘design’ document is to have priority in the event of inconsistencies. In the Chartered Institute of Building Contract for Use with Complex Projects, precedence is given to BIM models over drawings. But the International Federation of Consulting Engineers Contract – t he preferred form in Qatar – is silent on the use of BIM and so careful consideration should be given to how inconsistencies will be resolved.

Given that drawings and BIM models are both likely to be treated as design documents describing the scope of works, there should, ideally, be no inconsistencies between them.

It is therefore sensible, as they are documents forming part of the contract, that the drawings and BIM models have the same priority. However, as there is no set rule, bidders should carefully scrutinise the contract in cases where BIM is being used.

BIM post contract award Even if the priority is given to the design documents in a construction contract, BIM models must be regularly updated throughout the design process.

One of the challenges with BIM is to ensure that all the parties on a project buy into and use BIM software. Some design and build contractors may have challenges getting their supply chain to use BIM – usually due to a lack of expertise or the increased cost of recruiting a BIM manager.

Some of the parties on a project are likely to continue to produce drawings, but irrespective of the priority given to the design documents in their contract, BIM models must be regularly updated throughout the

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design process. Failure to do this may result not only in inconsistencies but also incomplete or inaccurate design documents, which can have severe time and cost consequences.

In a traditional construct-only contract, the responsibility for correcting inconsistencies in the design documents issued to the contractor and updating BIM models should sit with the employer. The contractor should, in theory, be entitled to additional time and cost resulting from such inconsistencies if they delay the contractor in executing the works, although not all contracts will address this.

Under a design and build contract, typically, the contractor has single point design responsibility and the contractor is responsible for correcting all design inconsistencies and updating BIM models. The contractor cannot recover additional cost from the employer, but it may have recourse against its design sub-consultants. It is unlikely that the contractor can pass the liability down the supply chain, through back-to-back contract provisions, if subcontractors in the supply chain are not using BIM. Contractors must therefore ensure that they regularly update and efficiently manage the BIM models.

Where BIM is used, all parties must ensure their contracts clearly define BIM deliverables and the roles and responsibilities of each party for updating and maintaining BIM models. Bidders should be aware of the liability they are accepting in relation to conflicts between drawings and BIM models, especially if the contract is silent or unclear on the use of BIM.

Gabriel Olufemi is a solicitor at Pinsent Masons, and Paul Prescott is a senior associate at Pinsent Masons.

QCN | February 2015

Road accidents are a leading cause of deaths in Qatar. Injuries and deaths related to road accidents can be reduced by incorporating better road designs. (Image Corbis)

Designing safer roads

in Qatar Of the total number of deaths, 14.3 percent of fatalities in Qatar result from traffic accidents. To address the issue, Qatar’s National Road Safety Strategy 2013-2022 aims to achieve a safe system through a variety of approaches, which include safe roads. Indeed, incorporating safety when designing roads can help reduce the number of deaths and injuries linked to road accidents.

Carlos Riera Planells of the Public Works Authority (Ashghal) looks into the current design features of Qatar’s roads, while suggesting engineering solutions to improve their safety standards in the future.

Q

atar is notorious for having one of the highest rates of road accidents across the world in proportion to its population. Visiting Hamad General Hospital’s Trauma Center, it is not unusual to see cases of traffic accidents with serious injuries.

According to the Mortality from Road Crashes in 193 Countries: A Comparison with Other Leading Causes of Death – a report published by the University of Michigan’s Transportation research Institute in February 2014 – 14.3 percent of deaths in Qatar result from road crashes. The percentage is second highest in the world after the United Arab Emirates, with a rate of 15.9 percent.

Road trauma costs everyone. It costs lives. It costs wellbeing and happiness, and it costs money.

Qatar’s road trauma costs average over USD1.2 billion (QAR4.37 billion) a year. These costs are unacceptably high and need collaborative efforts to bring about a change.

In the context of these alarming statistics, Qatar launched its National Road Safety Strategy 20132022 in January 2013. Prepared in collaboration of the National Committee for Traffic Safety and Public

While many roads in Qatar are divided using a median, often there are no crash barriers to prevent vehicles from crossing over the median and striking opposing traffic.

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feature story

Qatar’s government aims to make roads, vehicles and roadsides safer through engineering safer infrastructure. (Image Arabian Eye)

Roads should be designed to be forgiving of mistakes so that when a crash does occur, the outcome is not fatal or serious.

The design of a road can make a significant contribution to the number and severity of crashes that occur.

February 2015 | QCN

Works Authority (Ashghal) along with some other companies, the document is aimed to reduce the number of accidents and deaths linked to road accidents.

Despite such initiatives over the last five years, the situation is still not satisfactory.

Road safety is a shared responsibility that has to be based on cooperation and coordination by all state agencies, the general public and the private/business sector, working together at every level to develop effective and innovative safety initiatives and interventions. Part of the responsibility, of course, lies with the drivers to abide by the traffic rules. Pedestrians need to be equally aware of using allocated crossings at the right time. Another factor that can help improve the situation is better road designs. With road safety in mind, a number of roundabouts across Doha have been recently transformed into traffic signals. However, there is still room for improvement and Qatar’s rapid growth and expanding road infrastructure creates an opportunity to build a world-class road network with cutting-edge safety features.

As per the National Road Safety Strategy 2013-2022, Qatar’s road safety vision is to have a safe road transport system that protects all road users from death and serious injury. To achieve this vision, the target for 2013-2022 is to reduce the annual number of road crash fatalities to 130, and the annual number of serious injuries to 300 by 2022. The report introduces the safety strategy called Safe System, which stresses the importance of

Run-off crashes occur when the vehicles collide with a fixed obstacle or if they roll over. They can be avoided by providing a crash barrier and clear roadsides, and installing safe lighting columns and signs.

“self explaining and forgiving roads, and roadsides that protect road users”.

Designing safer roads The design of a road can make a significant contribution to the number and severity of crashes that occur. Roads can be designed to be self explaining so that drivers understand what to do and can reasonably anticipate the road ahead, leading to a reduction in the number of crashes. In addition, roads can also be designed to be forgiving of mistakes so that when a crash does occur, the outcome of the crash is not fatal or serious.

Hence, roads should be designed in a manner that not only promotes safe driving and appropriate speed choice,

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“actions for roads and roadsides” to reduce the number of injuries and deaths linked to road accidents

Assessing and treating safety priorities on existing roads using a range of techniques such as Road Safety Assessments and blackspot analysis

Improving design and safety features of new roads through the review of highway design standards and introducing proven approaches such as Road Safety Audit

Reviewing and updating the manual of traffic control devices Improving facilities for pedestrians and pedal cyclists

Introducing automated systems for supporting the enforcement on highways Improving safety of school zones Educating road users on how to use the roads safely

Monitoring and evaluating what works in Qatar

Source: Qatar’s National Road Safety Strategy 2013-2022

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section story feature

Qatar’s road safety vision is to have a safe road transport system that protects all road users from death and serious injury. (Image Arabian Eye)

but also mitigates the consequences of collisions. The functionality of the road needs to be considered. Roads and their signage, markings and linings need to be inspected on a regular basis from a safety perspective to ensure they are as safe as can be reasonably expected to reduce the possibility of road users making errors.

Remedial interventions should be carried out to correct any issues that arise from inspections. These interventions do not have to be very costly – routine maintenance, such as removing overgrown hedging from stop/yield signs can prevent a driver from making a mistake that could have costly consequences.

Current road situation While many roads in Qatar are divided using a median, often there are no crash barriers to prevent vehicles from crossing over the median and striking opposing traffic. Medians in urban areas are often planted with trees, or contain lighting columns. Striking these obstacles in case of an accident means the crash is likely to be more severe. Similarly, presence of such obstacles on the roadside increases the severity of crashes.

Intersections in Qatar vary in terms of their road suitability. On some main urban roads where a service road is not provided, there is a high concentration of accesses and parking directly on to the main road. This is considered to be February 2015 | QCN

feature section story particularly dangerous.

Roads here do not always have facilities for pedestrians to help them use the roads safely. To exacerbate the situation, due to the high levels of construction, pedestrian facilities are often interrupted by construction sites. Parallel parking is provided on some divided urban roads, meaning that pedestrians have to interact with relatively high-speed traffic. This makes pedestrians vulnerable to crashes, as cars often skid sideward as a result of, or to avoid, a collision.

Qatar’s government aims to make roads, vehicles and roadsides safer through engineering safer infrastructure. However, engineering and designing for road safety is only a part of the solution. Ultimately, it is also the responsibility of every road user to ensure their own personal safety and to make a contribution to the safety of others through responsible road use.

To avoid road accidents, pedestrians need to be equally aware of using allocated crossings at the right time.

(Image Arabian Eye)

Recommendations Road traffic collisions generally fall into one of four types of serious crashes: headon crashes, run-off crashes, crashes at junctions, and crashes involving pedestrians and cyclists. Roads can be engineered accordingly to ensure that injuries sustained in these types of crashes are low in severity.

Head-on collision: Being one of the most serious type of road crashes, the level of severity in such accidents is significantly high as two vehicles hit each other in opposite directions. The fatality risk for a properly restrained vehicle occupant is 95 percent at a head-on crash of 70 kilometres per hour (km/h), resulting in a critical speed just above 70 km/h. From an engineering and design point of view, such crashes can be reduced by providing a median crash barrier to eliminate the possibility of a car slipping on the parallel lane with opposite flow.

Crossing the car over rumble strips causes vibration, designed to alert the driver, thus reducing accidents resulting from inattention.

Run-off crashes: These crashes happen when the vehicles collide with a fixed obstacle or if they roll over. Providing hard shoulders and rumble strips gives the driver an opportunity to correct for their mistake.

Shoulders provide an extra lane parallel to the main roads. Often used as an emergency stopping lane, they provide space to make a sudden move without colliding with any other vehicle or obstacle. Rumble strips, on the other hand, are raised from the overall

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level of the road. Crossing the car over rumble strips causes vibration, designed to alert the driver, thus reducing accidents resulting from inattention.

Run-off collision can also be avoided by providing a crash barrier and clear roadsides, and installing safe lighting columns and signs.

Crashes at junctions: Side impact crashes at T-junctions or crossroads can be particularly high in severity. The chances of survival for a properly restrained motor vehicle occupant diminish rapidly at speeds greater than 50 km/h where vehicle side-impacts are possible. Sometimes it is suitable to replace cross roads and T-junctions with roundabouts. While roundabouts may increase the number of crashes, the accidents will be less severe in nature. At junctions on high-speed roads, engineering should provide only grade separated slip road intersections.

Grade separation ensures that the roads with different traffic directions are at different heights. Varying heights of paths protect the vehicles from running into one another from the side or otherwise.

Crashes involving pedestrians and cyclists: Pedestrians and cyclists are extremely vulnerable in traffic above 30 km/h. Designers should hence aim to prevent their access to high-speed roads.

At the same time, however, pedestrians and cyclists should be provided with safe and convenient facilities for crossing and walking along the road. Wherever possible, roads should be equipped with systems to manage and enforce traffic speeds where there are pedestrians.

Carlos Riera Planells is team leader in the Traffic Diversion Plan Approvals Office at the Public Works Authority (Ashghal).

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section

All major tr are in Qatar An interview with Lars Erik Forsbergh, President, Volvo Trucks Middle EasT

Catering to a wide range of markets, the growing numbers of trucks in Qatar to a large extent come from the country’s booming construction market. Speaking about the latest trends and challenges in Qatar’s truck market, president of Volvo Trucks, Middle East, Lars Erik Forsbergh shares the company’s competitive strategies to match the local market needs.

February 2015 | QCN

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In January 2014, Volvo Trucks unveiled its new FH, FM and FMX models.

Of these, according to Lars Erik Forsbergh, president of Volvo Trucks Middle East, FMX is especially designed for the harsh construction environment.

ruck players Lars Erik Forsbergh, president of Volvo Trucks, Middle East, started his career with Volvo as a sales representative in the Volvo International Development Corporation in Baghdad in 1981, and took over as the president of Volvo Trucks Middle East in 2013.

QCN | February 2015

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interview

Please tell us about Volvo Trucks’ presence, product range and dealership in Qatar.

Volvo Trucks is represented by Domasco (Doha Marketing Services Company WLL) which is a group of companies in Doha, Qatar, under the Dubai-based Al Futtaim banner and Qatari investors.

Domasco’s Volvo Trucks Division in Doha has spacious facilities and Volvo-trained staff from sales to aftermarket service. The Sales and Service Centre, located in street 48 in the Industrial Area, caters to clients for parts requirements and a mobile workshop is likewise available for service on the go.

Setting up Volvo Trucks as an important division of Domasco, three years ago, required a lengthy regional study to ensure that the market needs and demands were met in full. Experts from Sweden together with their counterparts in Qatar conducted local surveys, assessing the specific conditions and requirements.

When we started this project, the main concern was to bring the right truck for the extraordinary operation conditions in the local environment.

What products are in high demand in Qatar’s construction sector? Can you tell us about their core features?

It is the FMX tractor 4X2. The road regulations allow you to work with mainly 4X2 on the tractor head segment and 6X4 and 8X4 on the rigid segment. We sell the best-suited truck for Qatar’s environment; the robust FMX is especially designed for the tough construction environment.

The Volvo FMX gave the construction segment a clear identity and now we are taking a huge step forward in all the most important areas – robustness, handling and design.

Everything has been developed with the driver’s

February 2015 | QCN

“The Qatari market is becoming more and more aware of the total cost of ownership.”

Fleet managers and owners can increase their trucks’ productivity by training drivers according to their needs.

Volvo’s web-based system allows customers to track their vehicle’s position 24 hours a day, 365 days of the year.

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efficiency and productivity in focus.

Most of the new features of the FMX are designed to increase the truck’s productivity and durability, something that is very important for customers in this segment. The new air suspension system, for instance, gives excellent drivability and is tailor-made for construction work, without any compromises or links with other segments. Not to forget that the mechanical suspension is still available in all models, the Volvo FMX Trucks sold in Qatar are all 13L engines and Euro 3 compliant.

What are some of the leading trends in the trucks market in Qatar?

Volvo I-Shift is a growing trend in Qatar as the market is becoming more and more mature. The I-Shift transmission, exclusively developed by Volvo Group for Volvo, is an excellent example.

It is efficient when manoeuvring at low speed.

I-Shift offers smooth, yet swift gear changing, always selecting the right gear. It enables the driver to focus on driving and keeping both hands on the steering wheel. 100 percent of Volvo’s new generation trucks sold in Qatar are with I-Shift.

How competitive is Qatar’s truck market?

What is Volvo Trucks’ unique selling point?

The number of trucks in Qatar is set to grow considering the rise in the country’s ongoing construction activities.

With Qatar’s construction sector heavily dependent on imported materials, the need for trucks for logistics solutions is inevitable.

All major truck players are in Qatar as it is a booming market. So it is very important for us to have a good representation through Domasco with a strategic location for our service centre with an improved capacity, modern tools and processes. Domasco is also planning to open a new service centre in order to double the capacity due to the growing truck population in the market to maximise customers’ uptime.

We also have a fantastic range of new products, the Volvo FH, FM, and FMX which come with breakthrough technologies to suit all customer needs.

What are some challenges particular to Qatar’s trucks market?

The Qatari market is becoming more and more aware of the total cost of ownership. The fleet managers and owners want to make the best out of their trucks and increase their productivity.

So productive drivers are becoming more and more important, that’s why in Volvo Trucks we provide tailor-made driver trainings, according to customer needs, to make sure that the truck usage is optimised.

In the future, I see Qatar’s truck market promising and booming. We have had a doubleQCN | February 2015

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interview

“It is important to remember that a [safety] system or function can never take away the responsibility of the driver.”

digit growth in 2014 and we are forecasting the same in 2015. The new range is allowing us to be a key player in a demanding market like Qatar.

Tell us about recent technological advancements applied in Volvo Trucks.

Volvo Trucks has developed the Dynafleet telematic system. This web-based system allows our customers to track their vehicle’s position 24 hours a day, 365 days of the year, while also monitoring the driver, his driving patterns and habits, offering coaching and training when needed. The Dynafleet system allows business owners to pin-point areas challenging profitability while ensuring that their drivers operate in the safest and most efficient possible conditions.

Via our Dynafleet system, also available as a free application for smartphones, customers can reduce wear and tear while increasing safety, and maintaining profitability and fuel efficiency essential for a successful business. This system is now operational in several markets within the Middle East and more and more customers are seeing the added value of Dynafleet in their business.

What are the post-sales and other benefits of Volvo Trucks in Qatar?

Domasco in Qatar has a service centre and it is planning to open another one to cope with the increasing truck population in the market.

We also offer service contacts and genuine Volvo parts with our regional warehouse based in Dubai with 91 percent parts availability to reduce the lead-time for our customers.

Furthermore, the Dynafleet is part of a wider package that Volvo offers to its customers. The complete offering includes I-shift technology,

airflow package, driver training and Dynafleet.

This package promises fuel savings of up to seven percent, making Volvo trucks one of the most fuel efficient in the industry.

The company also offers service contacts depending on the customer’s needs and truck usage. The service contacts help truck operators focus more on their business and to avoid any unplanned stops.

We provide constant training for mechanics to be sure that we have the best in-class and to give the optimal service. Our back office in Dubai makes sure all technical questions/ requests are handled in a timely way.

Is the defining feature of Volvo’s safety applicable to its trucks range as well?

Safety is one of Volvo Trucks core values with quality and environmental care. We take safety very seriously at Volvo Trucks. Over 1.2 million people die each year on the world’s roads. This means around 3500 people a day.

Trucks are involved in relatively few accidents, considering the number of such vehicles on the roads and the large amounts of transportation they carry out. But when a truck accident does occur, the consequences are often serious. However, giving up trucks is not an option. Transports are the blood circulation of modern society. Our vision is that no Volvo truck is to be involved in a traffic accident. We approach it through a continuous dedication to safer drivers, safer vehicles and safer roads.

Safety has always been one of our core values. From the very beginning, our founders made it clear that safety is a matter of special importance that goes beyond product features.

Back in 1927, they stated this in one simple sentence: “The basic principle behind all design

Safety landmarks achieved by Volvo Trucks

1959

1969

1959 Volvo Trucks introduced the safety cab February 2015 | QCN

Introduced Front Underrun Protection System

Volvo Trucks Accident Research Team established

The three-point seat belt is invented by Volvo

1996

1979

First truck manufacturer to make seat belts standard

interview

37

Tell us about traffic research that goes into the process of designing safety features?

work is, and always must be, safety.”

Since then, safety has become an inherent philosophy and quality that influences all who work at Volvo. Our more recent advances within preventive safety include areas such as: Advanced Vehicle Dynamics: Various systems that boost the truck’s dynamic stability in emergency situations and in fast manoeuvres, such as Electronic Stability Program and Traction Control System.

Driver Alert Support (DAS): DAS is designed to let the driver know when he’s driving differently than usual. Driver Alert Support monitors steering and behaviour. A video camera keeps track of the position in the lane.

Headway Support: It is the general denomination for various solutions that help the driver maintain a safe distance from the vehicle in front. It includes Adaptive Cruise Control, which is available on many of Volvo’s truck models.

It is important to remember, however, that a system or function can never take away the responsibility of the driver.

Given the limited storage capacities on site, trucks make a significant part of logistics solutions in Qatar’s construction sector.

Lastly, can you share any tips about best “All major maintenance of trucks in places like truck players Qatar? are in Qatar as Continue to utilise genuine parts, respect maintenance intervals, use Dynafleet and it is a booming I-shift. You should also make sure the drivers market. So it is are trained to operate that specific truck at optimum level. Service contact and proper very important its vehicle handover process both with the fleet for us...” manager and the driver is also vital.

Introduced Electronic Stability Program for all combinations

First truck manufacturer to offer a factoryfitted alco-lock

2005

Why do we have traffic research? Well it’s pretty simple. We need to know which are the most common accident types. As we are striving for our ultimate goal of zero accidents with Volvo Trucks, we need to understand what the causes and consequences are.

It is an ongoing development of understanding the traffic environment designing systems to decrease accidents, putting them into production and then following them up in the field to make sure that we are minimising accidents.

Volvo seeks to prevent accidents before they ever happen by supporting the driver as far as possible. Development is carried out on the basis of how human beings function and react. In this context, the design of the driver’s environment is extremely important. Our cabs are crash-tested in the world’s toughest safety tests. Crumple zones, injury-preventive materials inside the cab, three-point seat belts and airbags are some examples of safety measures that protect the driver in the event of a collision.

Better maintenance of trucks requires trained drivers to operate the specific truck at its optimum level, according to Lars Erik Forsbergh, president of Volvo Trucks Middle East.

2009

2008

Introduced Driver Alert Support system

QCN | February 2015

38

legal

Contractors’ right to clearer provisions for time EXTENSion It is not too late for contractors who have signed contracts with unclear provisions on time extensions to rectify the situation today, writes Aline El Sayed of Al Misnad & Rifaat.

Construction agreements generally entitle the employer the right to recover liquidated damages from the contractor, at a rate determined in the agreement, in the event of delays. The practice is common across the world.

However, the practice of having clear provisions in events where delays are not due to any fault of the contractor, is not quite as popular – an issue more noticeable in Qatar. Contractors here frequently find themselves forced to sign one-sided contracts, with vague and discretionary contractual clauses, in fear of losing to other bidders for the mega projects.

Current situation The standard form of contracts used in Qatar for all projects is the General Conditions of Contract prepared by the Public Works Authority (Ashghal). It has been interpreted as an incorporation of the International Federation of Consulting Engineers (FIDIC) form of contract with an adaptation to comply with Qatar’s market and legal requirements. This contract, initially drafted to fit the expectations of Ashghal, is now the preferred template agreement of most employers in Qatar.

The standard list of events that would relieve the contractor from its obligation to complete the works by the contractual deadline, as per the Ashghal Contract, is limited to the events of failure to give possession of the site, additional or extra works and some ambiguous events defined as “special circumstances” or “beyond the contractor’s control”.

On some infrequent occasions, the contractor may succeed in including straightforward provisions in the list of events allowing extension.

However, in most other scenarios, the contractor is often left uncertain as to what its exact rights are. For instance, what if the employer stops paying the contractor which disrupts February 2015 | QCN

the progress of the works and causes a delay? What if the employer asks for a variation or suspends the works and then does not approve the extension of time claim of the contractor? What about biased engineers who are willing to do whatever it takes to please the employer who is compensating them for their work? What if multiple factors or parties cause the delay? It is unlikely that the current wording of the Ashghal contract answers the above questions.

Unclear provisions allow for a discretionary interpretation by the employer and the engineer. The contractor is therefore left more exposed to the risk of not being granted the extension of time requested, and consequently the risk of wrongfully bearing liquidated damages for delay.

to the extension of time clause in construction agreements in Qatar to help preserve the contractor’s rights.

Recommendations Qatar Civil Law: The concept of extension of time is not per se recognised under Qatari Law. Contractors, however, may rest assured that the court would apply other legal principles to the case in order to weigh up the interests of the parties and reduce an “exhausting” contractual obligation to a reasonable margin if need be [Article 171 of the Qatari Civil Law no. (22) of 2004]. The court would look to identify the party responsible for the delay and grant or refuse the request for extension to the contractor. Accordingly, the contractor would be relieved from the liquidated damages obligation, as per Article 199 of the Qatari Civil Law.

New legislation: With the rising number of disputes resulting from unclear provisions, a new legislation is necessary to provide a mandatory extensive list of events that would entitle the contractor to an extension of time, liquidated damages to be paid to the contractor by the defaulting party causing the delay, and ideally, penalties for late payments from the employer.

A well-drafted extension of time clause would benefit both parties, by guaranteeing the respect of the contractual time for completion of the works, protecting contractors’ rights in the event of delays caused by the employer, and, preserving the rights of the employer to liquidated damages.

FIDIC: A greater protection to the contractor is granted under the FIDIC form of contract, where time extension is accorded to a contractor in events of “any delay, impediment or prevention caused by or attributable to the Employer, the Employer’s Personnel, or the Employer’s other contractors on Site”, as per clause 8.4 (c) of the FIDIC Silver Book.

Such a provision should be included

Side letters: Contractors who have signed contracts with unclear provisions can rectify the situation today, subject to agreement of the parties. A side letter could be signed with the employer, in which the unclear extension of time clause is reworded to cover all possible events of delay and to clearly state the procedure for evaluating the extended time duration for each event.

This letter would supercede the varied clauses of the original construction agreement where necessary, and could include amendments to various unclear provisions. It is recommended to obtain a lawyer’s input before signature.

Aline El Sayed is a senior associate at Al Misnad & Rifaat.

www.QatarTenders.com

www.QatarTenders.com Tender Name

Description

Client

Refurbishment & Upgrading Works

Carrying out refurbishment and upgrading works for various pumping stations

Public Works Authority (Ashghal)

964

3/10/2015

Fire Station Construction

Carrying out construction of fire station no. 6

Qatar Petroleum

137

3/8/2015

Landscaping Maintenance Services

Provision of landscaping maintenance services

Qatar Petroleum

137

3/8/2015

Mud Chemicals, Equipment and Engineering Services

Provision of mud chemicals, equipment and engineering services

Qatar Petroleum

137

2/22/2015

Civil Replacement & Maintenance Works Carrying out civil replacement and maintenance

Qatar General Electricity & Water Corporation (Kahramaa)

822

2/19/2015

Consultancy Services

Provision of consultancy services for project management and technical support services

Aspire Foundation

549

2/19/2015

Infrastructure Works

Execution of Infrastructure Works

Lusail Real Estate Development Company

275

2/19/2015

Temporary Administration Building Construction, Road Pavement Works & Power Supply Services

EPIC of temporary administration building, pavement of road and permanent power supply services

Oryx GTL

137

2/18/2015

Land Survey and Mapping Services

Provision of land survey and mapping services

Aspire Foundation

55

2/17/2015

Consultancy Services

Provision of consultancy services for construction of administrative offices, garage and labour accommodation

Public Works Authority (Ashghal)

275

2/17/2015

External Walkways Replacement

Replacement of external walkways

Primary Health Care Corporation

55

2/17/2015

Water Network SCADA System Shifting Services

EPIC for shifting of a water network SCADA system Qatar Petroleum

55

2/16/2015

Roof Waterproofing Renovation

Renovation/Replacement of existing roof waterproofing

Primary Health Care Corporation

55

2/16/2015

Access Control Systems

Supply, installation, testing and commissioning of Primary Health Care access control systems Corporation

55

2/16/2015

works for existing sub-stations

February 2015 | QCN

FEES (USD)

Closing (m/d/y)

ALUMINIUM TECHNOLOGY AUXILIARY INDUSTRIES W.L.L. T. 4460 2334/ 4460 2835/ 4450 4131 F. 4460 2841 to 42 P.O. Box: 40625, ST. No. 31, Bldg. No.157, Gate No. 149 Salwa Industrial Area, Doha-Qatar E. alutec@qatar.net.qa

"Pioneer in High Quality Building Facades"

Our Facilities

• Full fledged Glass, Aluminium & Steel fabrication factories • Test Rig 6m X 8.5m for Testing of Curtainwall as per BS & American Standard • Power coating, Kynar/PVDF Coating and Anodizing • New glass processing factory at New Industrial Area with advanced European Lamination Plant, Heat Soaking Furnace, Glass Fusion Furnace, Waterjet cutting machine & Ceramic image printer

Specialized In • Glazed curtain wall : Unitized, Structural, Spider & Conventional.

• UL certified fire-rated steel-glass doors/windows, partitions & curtain wall.

• Cladding : ACP, Stainless Steel, Bronze & Fibre cement panels.

• Bulletproof/blast resistant glass, tempering &

• • • •

lamination of jumbo glass, curved lamination & acoustic glass panels.

Architectural decorative screens – Metal & Glass.

Automatic sliding, hinged & revolving doors.

Staircase, handrails & balustrades Protective coatings : PVDF/Kynar, powder coating anodizing & wet coating.

INTERVIEW: Lars Erik Forsbergh, president, Volvo Trucks Middle East, on Qatar’s truck market – PG. 32

issue 2.2

February 2015

STREET SMART:

Can improved road designs reduce accidents in Qatar?

Qatar’s

RISING CoSTS Causes and repercussions of the construction inflation spectre

PLUS:

Contractors’ right to clearer provisions for time extension

TECHNOLOGY

Considerations to resolve conflicts between drawings and BIM models