In October 2017, the Wide Bay Burnett Regional Organisation of Councils (WBBROC) collected the award for water projects over $5 million at the Institute of Public Works Engineering Australasia (IWEA) Queensland 2017 Excellence Awards for its Joint Sewer Rehabilitation Program.
The award recognises councils and individuals who have demonstrated best practice and innovation in public works projects across Queensland.
It was awarded to WBBROC for its collaborative effort to deliver a large-scale joint procurement of sewer relining services to extend the life of sewer assets and deliver efficiencies for water and sewerage customers, following an extensive planning period.
The WBBROC is comprised of Bundaberg Regional Council, Cherbourg Aboriginal Shire Council, Fraser Coast Regional Council, Gympie Regional Council, North Burnett Regional Council and South Burnett Regional Council.
Cost saving with collaboration
WBBROC decided to create collaborative tender with the support of the Queensland Water Regional Alliance Program (QWRAP), which focuses on delivering efficiencies for water and sewerage customers through collaboration.
Heather Gold from QLD Water said, “Joint procurement is often the first thing discussed when regional groups are established, and yet it can be one of the most difficult achievements to deliver, due to the challenges of dealing with different council policies and protocols, and alignment of maintenance and renewal programs.
“The benefits however can be significant. After an extensive period of planning, the Wide Bay Burnett Regional Organisation of Councils has delivered a large-scale joint procurement of sewer relining services, largely thanks to the significant efforts of the collaborating councils, and specific leadership of Fraser Coast Regional Council.”
Major benefits realised for WBBROC due to the collaborative tender process include:
- Being able to offer a larger tender value attracted wider competitive interest which is often difficult for individual councils as some networks are too remote or lack the critical mass to attract a broad range of contractors. The wider interest resulted in competitive pricing due to the commercial scale, security and lower equivalent tenderer costs.
- The program developed a regional understanding of network needs to take advantage of economies of scale, standardising contractual arrangements to provide both certainty and enough flexibility to deal with idiosyncrasies.
- Stage one cost just over $6 million with 10 per cent savings directly delivered to councils and their communities, and an additional $2.4 million was saved due to Cherbourg Council using relining technology instead of replacing sewerage assets. The significant cost savings have allowed twice the length of mains to be relined than originally budgeted for.
- The work has led to significant intangible benefits, with the procurement documentation serving as a basis for other projects both within the region, and for other alliances elsewhere in Queensland.
The program
The joint rehabilitation program is primarily focused on rehabilitating passive sewerage assets owned by WBBROC member Councils, including sewer mains and property connection junctions, with works split across two stages over two years. The tender for stage one was released in mid-2016 and was awarded to Abergeldie Watertech, who are part of the Abergeldie Complex Infrastructure group, in December 2016.
Both stages involve relining sections of the various sewerage networks on a progressive schedule, prioritised according to asset condition assessments conducted as part of each councils routine operation and maintenance activities.
The program is currently in its second year and WBBROC are now collating the works packages for stage two of the program. The contract for stage one was valued at $6 million and included the relining of sewerage networks combining the programmed works packages for four council areas.
Each council has been able to maintain local control of the sewer relining works with the appointment of a local supervisor.
Steve Brown, Regional Water Coordinator at WBBROC, said the works packages for each council were defined following a pre-tender CCTV survey of network condition to both prioritise and update condition assessments as part of the tender specification.
“Sewer relining is highly specialised work with relatively few suppliers available in the region. Three generally accepted relining technologies proposed included Folding Form (FF), Cured-in-Place Pipe (CIPP) and Spiral Wound (SW), although not all have the same durability and technical performance,” Mr Brown said.
FF was ultimately chosen because of its ability to accommodate a greater range of pipe diameters and a longer projected service life.
FF sewer liners are manufactured in a folded shape, and once it has been inserted into a pipe heat and pressure are used to form it back into a circular shape. This makes it versatile and simple to install.
Reducing contract risk
Mr Brown said the development of individual work packages and specifications played a crucial part in achieving savings as it removed potential contract risk to prospective tenderers through the definition of asset condition.
“Previous relining tenders relied on partial, typical or out-of-date survey information often resulting in a risk premium to unit rates and minimised the number of variation claims and cost overruns,” Mr Brown said.
“It was also key to allowing the tenderer to schedule the works more efficiently and led to a 50 per cent reduction or $60,000 in mobilisation costs between works packages.
“Further CCTV surveys were conducted during the course of and on completion of works and finally on expiration of the defects period, and allowed a greater confidence in restoration of network function and extension of asset life.”
The tender was managed by Wide Bay Water, a commercial business unit of Fraser Coast Regional Council, which not only saved the other councils a great deal of duplication, but also meant the smaller councils benefitted from technical and tender expertise that they did not have in-house.
Mr Brown said participation in the program was non-binding with two of the six councils in the Wide Bay Burnett Regional Organisation of Councils not requiring works in stage one.
“Cherbourg Aboriginal Shire Council joined the tender just after award (under participatory provisions) and increased the total value to around $6 million,” Mr Brown said.
“While this did not deliver further cost benefits to other participants, it significantly reduced tender administration costs to others. It is likely that in view of the highly competitive nature of the industry, the additional scope of works associated with Cherbourg’s participation would not have significantly reduced costs to other Councils.
“At commencement, Cherbourg had no works program requiring sewer relining and had not expressed any likelihood of involvement and their late participation was due to a diversion of surplus DILGP/QRA funding for STP upgrade works.”
Looking ahead
Mr Brown said the collaborative tender process has been highly successful and expects that it will set a precedent for subsequent calls for tenders for similar works packages.
“The model sets a precedent for application to a number of other regional procurement collaborations for water and sewerage service providers both within WBBROC and in other ROCs.”
