Connect with us

Concrete

BOOM, BOOT, BOO, EPC, PPP, LSTK…

Published

on

Shares

Tongue-twisters or cannon-balls? Neither. But, people who are from projects background know that these are acronyms of various different categories of projects. An understanding of these categories is quite important in the context of project management practices.

Forms of projects, classified on patterns of Ownership and Financing, are:

  • BOT – Build Operate Transfer
  • BOOT – Build Own Operate Transfer
  • BOO – Build Own Operate
  • BLT – Build Lease Transfer
  • DBFO – Design Build Finance Operate
  • DBOT – Design Build Operate Transfer
  • DCMF – Design Construct Manage Finance

On the other hand, going by contracting/execution philosophy, projects are grouped into:

  • PPP
  • EPC
  • EPCM
  • EPCI
  • LSTK

Why do we need to know and understand these jargon? Without a knowledge of these names and categories, we shall be unable to differentiate between different types of projects, and will also fail to capture the implications of these names in the way accountability devolves between owner, developer and contractor. Take for example, the two types under PPP and EPC, which can be discussed and distinguished. It will be an interesting comparison because The National Highways Authority of India (NHAI) has been using both these modes in their tenders for road projects in our country, over the last decade.

First, let us develop an understanding, and then we may analyse and compare these two terms. PPP is Public Private Partnerships, where a Government body and a private entity sign up to jointly develop, finance, execute and operate a (mostly) infrastructure project, and thus an entity called concessionaire is created (sometimes also called an SPV – special purpose vehicle). The contract demarcates the responsibilities of the two partners, and in most cases, the public partner assumes the preparatory works like land acquisition, statutory approvals, political resolution of issues, etc., in addition to overall tracking of the work to be done by the private partner. The public partner may or may not be bringing in any hard equity other than land, etc. The private agency invests money, obtains financing, executes the project and runs the assets thus created for a pre-defined period of time in order to realise a return on its financial investments. The Pvt Agency decides the contracting philosophy during execution, like say, EPC/LSTK/packages, etc.

EPC mode, on the other hand, is when NHAI competitively bids out a given highway on defined scope of Engineering, Procurement and Construction only, and the subsequent job of maintenance and toll collection, etc. can be tendered out separately. We can see that there is vast difference in scope between these two.

Primarily, projects which are financially viable are handed out as PPP’s while others where prima-facie viability is in question, EPC bids are invited. In 2012-13, when many developers of road projects were reeling under huge debt-burden, and did not have appetite for bidding in new PPP road projects, NHAI had to resort to large-scale EPC tendering to keep up the tempo of building highways. In the urban transportation sector, in Mumbai, the two cases of Mumbai Metro Line One, which was tendered as a PPP project and the Monorail project, which was tendered as EPC Project, are also very good examples that amply illustrate this discussion. The first one, considered viable, was won by Reliance Infrastructure in a PPP-bidding process, while the other one, which was financially not so sound, was won by L&T-SCOMI on competitive EPC-bidding mode. In the end, however, both these two projects got inordinately delayed primarily due to right-of-way issues, leaving us none the wiser about which mode was better from execution perspective.

As we can see, any study of project management will remain incomplete without an understanding of various types of ownership, financing, and execution of projects. Why not, therefore, take a look at some other types!

BOOT
A BOOT structure differs from BOT in that the private entity owns the works. During the concession period, the private company owns and operates the facility with the prime goal to recover the costs of investment and maintenance while trying to achieve a reasonable margin on the project. The specific characteristics of BOOT make it suitable for infrastructure projects like highways, roads, mass transit, railway transport and power generation and as such they have political importance for the social welfare impact but are not attractive for other types of private investments. BOOT and BOT are methods that find very extensive application in countries which desire ownership transfer.

Some advantages of BOOT projects are:

  • Encourage private investment
  • Inject new foreign capital to the country
  • Transfer of technology and know-how
  • Completing project within time frame and planned budget
  • Providing additional financial source for other priority projects
  • Releasing the burden on public budget for infrastructure development

BOO
In a BOO project, ownership of the project remains usually with the project company for example a mobile phone network. Therefore the private company gets the benefits of any residual value of the project. This framework is used when the physical life of the project generally coincides with the concession period. A BOO scheme involves large amounts of finance and long payback period. Some examples of BOO projects come from the water treatment plants. This facilities run by private companies process raw water, provided by the public sector entity, into filtered water, which is afterwards returned to the public sector utility to deliver to the customers.

Trying to define all these various types of projects and contracts may turn out to be quite lengthy, but before we sign off for the month, I would like to add here something from my experience in steel and cement sectors. Companies which have very strong engineering and project management and coordination set-ups, will like to save costs by implementing a large project thru many "Packages" and will take full ownership and accountability for its success or failure. Conversely, companies which are not so confident, or do not have strong project teams, or wishes to shirk responsibility, may opt for EPC contracts, and they have to accept an increase of at least 15 per cent additional cost for doing this. That is, truly speaking, the cost of coordination, management, and avoidance of accountability.

– SUMIT BANERJEE

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Concrete

India Sets Up First Carbon Capture Testbeds for Cement Industry

Five CCU testbeds launched to decarbonise cement production

Published

on

By

Shares
The Department of Science and Technology (DST) recently unveiled a pioneering national initiative: five Carbon Capture and Utilisation (CCU) testbeds in the cement sector, forming a first-of-its-kind research and innovation cluster to combat industrial carbon emissions.
This is a significant step towards India’s Climate Action for fostering National Determined Contributions (NDCs) targets and to achieve net zero decarbonisation pathways for Industry Transition., towards the Government’s goal to achieve a carbon-neutral economy by 2070.
Carbon Capture Utilisation (CCU) holds significant importance in hard-to-abate sectors like Cement, Steel, Power, Oil &Natural Gas, Chemicals & Fertilizers in reducing emissions by capturing carbon dioxide from industrial processes and converting it to value add products such as synthetic fuels, Urea, Soda, Ash, chemicals, food grade CO2 or concrete aggregates. CCU provides a feasible pathway for these tough to decarbonise industries to lower their carbon footprint and move towards achieving Net Zero Goals while continuing their operations efficiently. DST has taken major strides in fostering R&D in the CCUS domain.
Concrete is vital for India’s economy and the Cement industry being one of the main hard-to-abate sectors, is committed to align with the national decarbonisation commitments. New technologies to decarbonise emission intensity of the cement sector would play a key role in achieving of national net zero targets.
Recognizing the critical need for decarbonising the Cement sector, the Energy and Sustainable Technology (CEST) Division of Department launched a unique call for mobilising Academia-Industry Consortia proposals for deployment of Carbon Capture Utilisation (CCU) in Cement Sector. This Special call envisaged to develop and deploy innovative CCU Test bed in Cement Sector with thrust on Developing CO2 capture + CO2 Utilisation integrated unit in an Industrial set up through an innovative Public Private Partnership (PPP) funding model.
As a unique initiative and one of its first kind in India, DST has approved setting up of five CCU testbeds for translational R&D, to be set up in Academia-Industry collaboration under this significant initiative of DST in PPP mode, engaging with premier research laboratories as knowledge partners and top Cement companies as the industry partner.
On the occasion of National Technology Day celebrations, on May 11, 2025 the 5 CCU Cement Test beds were announced and grants had been handed over to the Test bed teams by the Chief Guest, Union Minister of State (Independent Charge) for Science and Technology; Earth Sciences and Minister of State for PMO, Department of Atomic Energy, Department of Space, Personnel, Public Grievances and Pensions, Dr Jitendra Singh in the presence of Secretary DST Prof. Abhay Karandikar.
The five testbeds are not just academic experiments — they are collaborative industrial pilot projects bringing together India’s top research institutions and leading cement manufacturers under a unique Public-Private Partnership (PPP) model. Each testbed addresses a different facet of CCU, from cutting-edge catalysis to vacuum-based gas separation.
The outcomes of this innovative initiative will not only showcase the pathways of decarbonisation towards Net zero goals through CCU route in cement sector, but should also be a critical confidence building measure for potential stakeholders to uptake the deployed CCU technology for further scale up and commercialisation.
It is envisioned that through continuous research and innovation under these test beds in developing innovative catalysts, materials, electrolyser technology, reactors, and electronics, the cost of Green Cement via the deployed CCU technology in Cement Sector may considerably be made more sustainable.
Secretary DBT Dr Rajesh Gokhale, Dr Ajai Choudhary, Co-Founder HCL, Dr. Rajesh Pathak, Secretary, TDB, Dr Anita Gupta Head CEST, DST and Dr Neelima Alam, Associate Head, DST were also present at the programme organized at Dr Ambedkar International Centre, New Delhi.

Continue Reading

Concrete

JK Lakshmi Adopts EVs to Cut Emissions in Logistics

Electric vehicles deployed between JK Puram and Kalol units

Published

on

By

Shares
JK Lakshmi Cement, a key player in the Indian cement industry, has announced the deployment of electric vehicles (EVs) in its logistics operations. This move, made in partnership with SwitchLabs Automobiles, will see EVs transporting goods between the JK Puram Plant in Sirohi, Rajasthan, and the Kalol Grinding Unit in Gujarat.
The announcement follows a successful pilot project that showcased measurable reductions in carbon emissions while maintaining efficiency. Building on this, the company is scaling up EV integration to enhance sustainability across its supply chain.
“Sustainability is integral to our vision at JK Lakshmi Cement. Our collaboration with SwitchLabs Automobiles reflects our continued focus on driving innovation in our logistics operations while taking responsibility for our environmental footprint. This initiative positions us as a leader in transforming the cement sector’s logistics landscape,” said Arun Shukla, President & Director, JK Lakshmi Cement.
This deployment marks a significant step in aligning with India’s push for greener transport infrastructure. By embracing clean mobility, JK Lakshmi Cement is setting an example for the industry, demonstrating that environmental responsibility can go hand in hand with operational efficiency.
The company continues to embed sustainability into its operations as part of a broader goal to reduce its carbon footprint. This initiative adds to its vision of building a more sustainable and eco-friendly future.
JK Lakshmi Cement, part of the 135-year-old JK Organisation, began operations in 1982 and has grown to become a recognised name in Indian cement. With a presence across Northern, Western, and Eastern India, the company has a cement capacity of 16.5 MTPA, with a target to reach 30 MT by 2030. Its product range includes ready-mix concrete, gypsum plaster, wall putty, and autoclaved aerated fly ash blocks.

Continue Reading

Concrete

Holcim UK drives sustainable construction

Published

on

By

Shares

Holcim UK has released a report titled ‘Making Sustainable Construction a Reality,’ outlining its five-fold commitment to a greener future. The company aims to focus on decarbonisation, circular economy principles, smarter building methods, community engagement, and integrating nature. Based on a survey of 2,000 people, only 41 per cent felt urban spaces in the UK are sustainably built. A significant majority (82 per cent) advocated for more green spaces, 69 per cent called for government leadership in sustainability, and 54 per cent saw businesses as key players. Additionally, 80 per cent of respondents stressed the need for greater transparency from companies regarding their environmental practices.

Image source:holcim

Continue Reading

Trending News

SUBSCRIBE TO THE NEWSLETTER

 

Don't miss out on valuable insights and opportunities to connect with like minded professionals.

 


    This will close in 0 seconds