Would it be better for European companies with plans to develop facilities overseas to hire local steel constructors? Practical experience has shown that this is not always the smartest option. The risks involved are often high, and the expertise of a European specialist generally provides more opportunities to reduce them. Though it does require the steel constructor to be organized accordingly.
The steel structure is generally the first element to go up when building a new industrial plant. From a budgetary perspective it’s often one of the more modest components, representing maybe five percent of the total cost. However, much of the steel structure is critical to project timing, since everything else depends on it. “Process equipment can’t be installed without the steel structure being in place,” says Dirk Teuwen, Manager of the Steelworks Business Unit at TCS. “It’s clearly on the critical path, so companies would be better not to take any chances with it.”
Some risk may be involved in hiring a local steel constructor. Teuwen: “Are they able to meet the required quality standards and deliver on time? This may not be the case, especially when specific engineering challenges are at play. Think of structures subject to patterns of vibrations or other complicating factors. In such cases it might be better to benefit from the engineering expertise and field experience of a European steel constructor.”
Erecting the steel structure is on the critical path of any industrial project, so companies would be better not to take any chances with it
A steel structure can be engineered and manufactured in Europe, ready to be erected in Africa, Central America, the Middle East or Russia. “We’ve done several projects like that at TCS,” confirms Teuwen. “For example, we built the steel structures of some of the largest methanol factories in the world here, in Europe, which were then erected in Trinidad and Tobago. We’ve done steel construction projects for agro-industrial groups developing facilities in Nigeria. We’ve engineered and manufactured reformer platforms for Quatar and Cuba. The list goes on with projects in Ghana, Siberia, Egypt and the United States. In these projects, it was local teams who erected the structure on site, but we are the masters of the game, making sure that deadlines are met, and quality is high.”
It does require the steel constructor to be well-organized. “Not every European constructor can carry out such projects,” Teuwen admits. “For one thing, they need an engineering office with a solid understanding of non-European standards, including factors such as resistance to earthquakes. Structures should also be engineered in such a way that they can be easily shipped in batches and erected by local teams, using special equipment. It also requires constructors to meticulously plan their work, making sure that offsite parts production is aligned with the onsite project plan. In other words, don’t leave it until the last batch to ship vital structural elements!”
And what about the administrative load and additional shipping costs? “They shouldn’t be overestimated,” says Teuwen. “The administrative burden can be high in some countries, but a well-organized company can deal with that. And yes, shipping is an extra cost, but it’s really a minor fraction of the entire budget, often less than 10% of the steel structure cost. For the project developer it is much more important to reduce project risks, because a potential project delay represents a much bigger loss.”
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