Trade Agreement: NONE
Tendering Procedures: All interested suppliers may submit a bid
Attachment: None
Competitive Procurement Strategy: N/A - P&A/LOI Only
Comprehensive Land Claim Agreement: No
Nature of Requirements:
Draft Second Communication to Industry Regarding the Procurement
Outlook Conference
June 11, 2013
Procurement planning is underway for Fleet Renewal requirements
for the Canadian Coast Guard. Consistent with the principles of
smart procurement, our intent is to engage industry and to seek
advanced information regarding requirements, procurement
strategies, and schedules prior to finalizing the approach.
This engagement will take place in a Procurement Outlook
Conference schedule for the morning of June 26, 2013, in
Halifax, Nova Scotia, and with an opportunity for one-on-one
engagement of the procurement team by interested industry
representatives during the day and a half following.
There are two themes for the conference:
1. Lessons Learned from earlier engagements and resulting
changes to the procurement approach,
2. The Canadian Coast Guard Vessel Life Extension work,
announced by the Minister of Fisheries and Oceans (DFO) in
February 2013,
Important announcement regarding new shipbuilding opportunities
related to the $5.2 B announced in Canada's Economic Action Plan
2012. The planned vessel acquisitions and the schedule of
vessels under 1000t will be announced and discussed at the
Mari-Tech conference.
To register for the conference, and for one-on-one engagements,
please contract Erin Dufour at E••••••••@•••••.••.ca.
Further particulars follow.
The Procurement Outlook Conference Agenda (Preliminary)
1. Introduction - Mr. Mark Seely, PWGSC
2. Opening Address - TBD
3. Peter Cairns, Canadian Shipbuilding Association.
4. Lessons Learned - Mr. Mark Seely
- review results from earlier engagements per the summary below.
5. New Vessels less than 1000 tonnes at CCG (announced at
Maritech)- Mr. Robert Wight, CCG
- overview of the new ship requirements planned in CCG.
6. Vessel Life Extensions at CCG - Mr. Michel Cecire, CCG
- overview of the life extensions planned in CCG.
7. Latest from other departments - Stan Ouimet
- brief overview of procurements underway or planned in these
departments.
8. Question and Answer - Mark Seely et al
- open forum for questions, comments.
Industry Engagement
For the one-on-one engagement, 30 minute sessions by interested
parties on the both the Vessel Life Extension program and build
of Small Vessel procurements. The sessions will be held on the
afternoon of June 26 and all day June 27. Please specify who
will attend, your interest, and whether you want to discuss
Vessel Life Extensions or the new vessels announced at the
conference. Should there be anyone not accommodated within this
schedule, sessions will be booked soon after at a time and place
suitable to Canada and the interested party. PWGSC will strive
to accommodate everyone and thus provide equal access.
Industry will be free to raise questions of interest during the
sessions. Of particular interest to Canada is the following:
For the construction of the new CCG vessels announced at the
conference:
General Procurement Issues
- Budget
- Schedule
- IPR
- Designer / Shipyard Availability
Procurement Requirement Issues
- Use of Proven Designs
- Design and Build versus Design then Build
- Long Lead Items
- 3D Production Modelling
For the Vessel Life Extensions (VLE's):
General Procurement Issues
- Budget
- Schedule
- Intellectual Property Rights
- Shipyard Availability
- Total System Responsibility
Procurement Requirement Issues
Lessons Learned
The following provides the summary lessons learned from earlier
industry engagements and new measures that have been taken in
response.
1. Budget
- Fair for work and risk
- Contingency should be provided for Risk
- For Innovative requirements, Management Reserve for evolution
- Validate prior to solicitation
New Measures
Pricing models reviewed and adjusted
Complexity and Risk Assessments conducted
Engagement of Industry in advance of procurements
Vessel quantities priced as options
Design Then Build
2. Approach
- For Innovative requirements, provide adequate focus on System
Development
Methodology and Change Control Procedure.
- Mature proven technology - Firm Price
- Innovation - Flexible Basis of Payment
- Avoid Build to Budget on innovative procurements (Level 3)
- Avoid Enterprise Solutions on Marine procurements (Level 4)
- Fair Risk Share
- Mature proven technology - Design Then Build
- Innovation - Design and Build, gating, early down select.
New Measures
Canada as the intermediary between designer and constructor.
Procurement Streaming - Routine, Standard, Complex.
3. Specification
- Avoid excessive mandatories
- Avoid conflict between functional, performance and design
obligations
- Extra caution in applying "proven design" vs. performance
obligations
- Validate prior to solicitation
New Measures
Specifications to be reviewed for Contract worthiness
Posting of Specification to industry for comment in advance of
solicitation
4. Schedule
- Omnibus requirements to be resource levelled, avoid gaps to
enable continuity
- Validate prior to solicitation
New Measures
Schedules adjusted by PWGSC for appropriate phasing
Posting of Schedule to industry for comment in advance of
solicitation
5. Method of Payment
- Reasonably aligned with costs incurred
- Avoid excessive Holdback
New Measures
Milestone payments to ensure alignment with the work
Holdbacks to be reduced by the Contracting Authority
Warranty milestones reduced from 5% to 3%
6. Price Adjustment
- EPA To be considered on projects of long duration
- FEA to be applied on projects where significant foreign
content is expected
New Measures
Price adjustments to be considered by the Contracting Authority
in larger and
longer-term procurements.
7. Liability
- Use standard models where applicable for Limitation of
Liability
- Liquidated Damages applied only on mature proven technology
(Level 2)
New Measures
New risk model implemented maximizing liability to the
contractor on a per incident, per annum and
contract basis.
8. Qualification
- Ensure adequate proven track record on engineering,
financial, facility, insurance.
New Measures
Posting of prequalification criteria to industry for comment in
advance of
solicitation
9. Process Simplification
- Consider streaming procurements based on complexity.
New Measures
Complexity and Risk based streaming now in place
Standard contract models now in place
Work still required on standardizing information requirements
Delivery Date: Above-mentioned
The Crown retains the right to negotiate with suppliers on any
procurement.
Documents may be submitted in either official language of Canada.
