The change management process in the PPP contract for scope changes proposed by the Procuring Authority was broadly structured as follows:

•  The Procuring Authority would issue a change notice;

•  The Project Company would respond with an outline cost within an agreed timeframe;

•  The Procuring Authority would then make a decision to allow the Project Company to proceed with a fully developed response based on the initial outline cost; and

•  If the Procuring Authority allowed the Project Company to proceed, the Project Company would submit a fully developed response.

However, there is no time limit on when the final response from the Project Company should be submitted. This proved to be a major flaw, as there was no time limit for the Project Company to respond with a fully developed solution. Each change had to be negotiated from first principles (with no base rates agreed prior to financial close), which added to the time required to complete the process.

In addition, there was a provision for the Project Company to refuse a change if the number of changes issued was over 15 during the construction period. As it happened, the Project Company did not enforce this right, as it became clear that more changes were needed for the project to proceed. In total, the variations implemented amounted to less than 5% of the initial capital cost.