Solution 02 · Cost & TOTEX stress-test for bids
Protect the tender price
you commit to.
The figure in your bid is the figure you will build to, above all on a lump-sum turnkey (LSTK) contract. We test the estimate behind your tender price: contingency, escalation and lifecycle TOTEX, before the proposal is signed off.
Mutual NDA · redacted files accepted
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Try it
Same estimate.
Two levels of confidence.
P50 means an even chance that the final cost stays within the price. P80 means four chances in five. The gap between the two is the margin you are really putting at risk.
Switch between them to see what changes in this illustrative estimate.
Illustrative estimate · €420M SWRO desalination DBOM
Contingency
vs estimate class range
6.5% · under-sized
Escalation & indirects
vs 42-month execution
−3.1% · gap
Vendor quote coverage
packages vs scope
88% · covered
Margin exposure
€9.6M unfunded
Adjust before price lock
Contingency
vs estimate class range
11.8% · adequate
Escalation & indirects
vs 42-month execution
−0.8% · aligned
Vendor quote coverage
packages vs scope
88% · covered
Margin exposure
€1.2M residual
Defensible at P80
Illustrative example. No client data.
Estimate maturity
The less defined the scope,
the wider the range.
We check whether the contingency matches the real maturity of the estimate, not the maturity the schedule assumes.
Class 5
Concept screening
Project definition
0–2%
Typical accuracy
−20/−50% · +30/+100%
Class 4
Study / feasibility
Project definition
1–15%
Typical accuracy
−15/−30% · +20/+50%
Class 3
Budget / tender basis
Project definition
10–40%
Typical accuracy
−10/−20% · +10/+30%
Class 2
Control / bid estimate
Project definition
30–75%
Typical accuracy
−5/−15% · +5/+20%
Class 1
Check estimate
Project definition
65–100%
Typical accuracy
−3/−10% · +3/+15%
Indicative accuracy ranges from AACE International recommended practice 18R-97 (process industries). Cover Intelligence applies these principles; it is not a member of, affiliated with or endorsed by AACE International.
01
Contingency sizing
Checked against estimate maturity and comparable projects, with P50 and P80 made explicit.
02
Escalation & indirect costs
Indices, base dates and site overheads tested against the real execution timeline.
03
Vendor quotes
Exclusions, validity periods and scope coverage checked package by package.
04
Cost vs operating boundary
No double-counting and no gaps between packages: spares, commissioning, first fills.
05
Risk allowances
Contingency traced to the risk register, not a flat percentage. Delay damages included.
06
Lifecycle cost
Energy and maintenance assumptions checked against the commercial model, the financing case and the performance guarantees.
What we challenge
Six places
margin usually leaks.
The findings come back ranked by margin impact, with the adjustment we recommend for each.
From model to decision
A number the board can defend.
Input
Your cost model
Cost breakdown, vendor quotes, risk register. Redacted files are fine.
Under NDA
Review
Independent challenge
Every major cost driver checked for realism against estimate maturity.
AACE-informed
Output
Ranked findings
Exposures ranked by margin impact, with the adjustment we recommend.
Before price lock
Before the price is locked, test it.
A confidential first call to agree the scope and timing of the stress-test.