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This topic contains 82 replies, has 36 voices, and was last updated by  dotun 2 months, 4 weeks ago.

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  • #16532
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    Kerstin Danert
    Participant

    Based on your experiences, and what you have learnt from the course, discuss the following:

    In order to assure finance ministries and donors of “value for money”, many organisations choose to hide the costs of failed boreholes. Thus, if a borehole does not yield water of sufficient quality or quantity, the client passes the full cost of the failed borehole onto the driller. However, the actual costs (e.g. materials, equipment, fuel and staff) need to be covered somehow. And so the driller increases the price of successful boreholes.

    Unfortunately, such practice means that organisations are reluctant to fund boreholes for people living in parts of the country where the risk of a failed borehole is high. Many organisations do not (or cannot) work there as it is too expensive. Even in areas where only a few boreholes fail, it is difficult to calculate the true costs of providing water supply services using groundwater.

    Please don´t extend your comments more than 10 lines. The goal of each forum is not to exhaust the topic, but to open a discussion. That´s why we recommend that you focus on the aspect which captures more your attention and don´t worry for answering all questions. Let´s share and build knowledge all together.

  • #16587
    Profile picture of
    dotun
    Participant

    Dear all
    I am one of the course facilitators for this module. I look forward to your full participation on the course.
    I will like to make a slight correction to the posting by Kerstin above. The second statement in the second paragraph should read ‘ Many organisations do not (or cannot) work there as it is too expensive’.
    You are all welcome.
    Dotun

    • #16610
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      Damian Indij
      Keymaster

      Thanks Dotun, I corrected it. Cheers, Damian

  • #16588
    Profile picture of
    aynul huda
    Participant

    Hi,
    Thanks Kerstin & Dotun for the focusing failed boreholes matter whihc is very important for budget preparation. The Cost for the negative/failed borhole is an issue which leaves an uncomfortable situation dealing with contractors where no cost allocated for failed/negative boreholes. Particularly the area where the bedrock is very common due to nature of the topography. Its been little bit difficult to prepare realistic budget taking into consideration the negative borehole cost when resources are limited. Thanks, Huda

    • #16604
      Profile picture of
      Kerstin Danert
      Participant

      Huda – thanks. Yes, when the costs of failed boreholes are “hidden” by putting all the risk onto the contractor, it makes it very difficult to prepare the higher level project budget. And in the situations where there are areas which are extremely difficult to find water, this is even more problematic. Gabriela (from Guatemala) touched on this issue in Module 1, noting that the lack of hydrogeological data available in these difficult areas makes things even more difficult. And yet if we are to meet the SDGs, this means tackling difficult drilling environments. But how should organisations budget, and should the risks be “hidden” within successful wells, or be made explicit?

  • #16605
    Profile picture of
    Kamal Khadka
    Participant

    Hi,
    I fully agree with Krestin, while not paying to negative/failed boreholes, contractors will be forced to exaggerate the cost for successful boreholes, which ultimately increases the cost of the project.
    I have practiced both way, for instance while working with IRC in Ethiopia we used to have two rates for successful and dry boreholes and the tendering was done for both provisions. Currently, we don’t have such provisions for dry boreholes, while successful boreholes are paid off, although the success rate is high so far here except very few cases.
    In my view, there should be comprehensive cost analysis for failed boreholes and provisions to be made in tendering so that bidder could compete for competitive rates.
    Regards,
    Kamal

  • #16607
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    amrita.bandoo
    Participant

    IN Trinidad and Tobago, Failed boreholes doesn’t affect the hidden cost of wells. Contractors are paid even though the borehole failed because its not their fault that the well wasn’t successful, but its the fault of the Geologist/ Hydro geologist that site the well. Success base contracts are usually not popular with Contractors as the risk is greater to the Contractor.
    The problem we encounter with Contractor’s bid, is that they try to recover most of the cost upfront ( site Prep, Mobilization, site office, drilling etc.) for the fear of failed boreholes.

  • #16614
    Profile picture of
    dotun
    Participant

    Dear Amrita
    Thank you for your posting. I have been told that like in Trinidad and Tobago, in Ghana the drilling contractor gets paid for dry boreholes but the geologist that sites the borehole is penalized or does not get paid. It is tricky because it is usually the same geologist that sites the borehole that supervises the borehole and declares it abortive. It is not fair. That some boreholes will be dry irrespective of the competence of the geologist or the driller is a fact of life. So why penalise someone for what is not necessarily their fault. What do you think?
    Dotun

    • #16643
      Profile picture of
      amrita.bandoo
      Participant

      In T&T geologist and hydrogeologist doesn’t get a pay cut, they might loss creability . As management will lose faith in them and will be sceptical about taking there advice, but this will not happen if u get one dry hole, this will occur if it happen numerous times to which I will agree! While I understand that geology is not an exact science, I know that geology changes significantly, and is due to something beyond the control of the geologists. But if the well is not productive and it is the fault of the Contractor, and it can be proven, them I will agree, that they should bear the full cost of the well?

  • #16615
    Profile picture of
    giftjasonwanangwa
    Participant

    In my case, I have seen many ethical issues coming up on pricing of boreholes. Profit making being the main factor on the part of the contractor. I have seen contractors bidding and claiming they have all professional staff and equipment required like geologists, hydrogeologists and good rigs. While come drilling period when supervising, you don’t see those kind of professionals or equipment on the ground. The equipment they promised cannot be obtained due to costing issues, the professional staff who were supposed to be there are not due to payment problems. Ethical issues affect contracting process.

    • #16622
      Profile picture of
      Kerstin Danert
      Participant

      Gift Jason – you raise a very important point here. That of unqualified and poorly equipped contractors wining bids. Have you thought about a pre-qualification process, which includes visits to the premises and inpection of equipment, as well as staff interviews? This is what is recommended in the vidoe.

      • #16639
        Profile picture of
        ouche
        Participant

        Hi Kerstin,
        These are some of the things UNICEF Nigeria is proposing to include in the bid evaluation stage, before contract are awarded. We are thinking of the drilling company staff signing availability statement, instead of interviews. But visits to premises will certainly be made. this will help identify brief-case companies

      • #16660
        Profile picture of
        Kerstin Danert
        Participant

        Ouche – this is very good to hear! We shall be very intersted to hear more about how this is implemented and how it works. When I visited Nigeria I heard incredible stories from the drillers, including examples of 419 🙂 companies putting their stickers on the rigs of the subcontractors. Please keep in contact with me after the module finishes and let me know how this works. It would be good, for example to get a small write-up or blog to inspire others on this!

  • #16616
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    SANDRANNICK
    Participant

    Hello everyone,

    In my opinion, the pay of the drilling contractor will be made in relationship with the risk of failed borehole: it is necessary to allocate a percentage of cost for the failed borehole according to the zone of risk of failed borehole. for example, if it is in a high risk area of ​​failed borehole, I think the company should be paying up to 50% but if it is in a low risk area, the payment will simply have to cover the expense for the study and all that, otherwise nobody will ever work in these areas. That is why we must always do hydrogeological studies (and geophysical if necessary) before drilling and if the studies are already done beforehand by other geologist, it is better to confirm them.

    Thanks!

  • #16618
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    giftjasonwanangwa
    Participant

    In other words, most of what is costed is never there or most of the things the contractor said will provide is not there.

  • #16620
    Profile picture of
    jndayizeye
    Participant

    I support the idea of paying 50 % of the cost for a failed borehole. This means that both the contractor and the organization have to share the risk of a dry borehole.

  • #16621
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    Kimezere
    Participant

    Success rate for boreholes should be established for each locality for example at the district level based on the past drilling operations or experience. This will guide the drilling contractors when coming up with the costing of the borehole.

  • #16623
    Profile picture of
    Kerstin Danert
    Participant

    Paying 50% is mentioned. What about paying according to the bill of quantities (BoQ)? In this case the driller is remunerated for the work actually done, including mobilisation to site, and drilling, but not for the works that are not undertaken. However, the BoQ needs to be realistic. Amrita pointed out above that if one is not careful, the driller can load an unrealistically high amount on the items that will be paid for even if the borehole is dry. A realistic Engineers Estimate for drilling is extremely important – it can help to find imbalances such as these when one is evaluating tenders, and can be used by the client in a negotiation process.

  • #16624
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    Kamal Khadka
    Participant

    Borehole costing model v2.8 guide is there but didn’t see excel model, may we get it?
    Thanks

  • #16625
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    Eneas Santos
    Participant

    In El Salvador, the public entity in charge of water management is the National Administration of Aqueducts and Sewers, ANDA. This institution hires private companies according to previously established criteria for drilling.

    Speaking of failed and successful wells, it is necessary to know the topography and know where the largest and best tributaries of groundwater are located.

    Betting on drilling wells where the probability that the drilling is failed is high, it is an irresponsibility that has the base tints of corruption. How to explain that the costs of the failed wells are charged to the costs of the successful wells? Is that not budgeted?

    https://www.laprensagrafica.com/elsalvador/Perforaran-12-pozos-de-agua-en-Chirilagua-20170506-0028.html

    Greetings!

  • #16626
    Profile picture of
    seec1587
    Participant

    From my experience working at the Water Authority of Trinidad and Tobago, our contracts are written where the contractor will drill, develop, pump-test, and do all the ancillary works to have the well put on stream such as civil, mechanical and instrumentation works. If a dry hole is drilled, the contractor isn’t penalized as the site is given to us by the Water Resources Agency in Trinidad. However, if a dry hole is drilled, the contractor is only paid for items used up until that point of the contract, which is normally half of the overall cost of the contract. Over the years, we have observed a dangerous trend as the contractor tends to front load costs in the drilling phase so in the event that a dry hole is drilled, he will get the majority of the money from the contract. As a result, the state has nothing to show for all the money being spent on a dry hole.

  • #16629
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    Michael Banja Baggu
    Participant

    Experience in areas where I worked in South Sudan for example, contractors exaggerate the depths of drilled boreholes to cover for the cost of unsuccessful boreholes. this is mainly linked to poor supervision during drilling, sitting and not enough hydrogeological information. I do agree with some of my colleagues to withheld payments until a proper investigation is done in the project. The ministry of finance should review the terms of agreement with the drillers. secondly, the ministry can setup a stringent mechanism to monitor the activity and if necessary increase the incentive for supervisors to prevent false reports.

  • #16632
    Profile picture of
    Gabriela Murillo
    Participant

    Hi Everybody. In my experience I can assure that here in Nicaragua the cost of dry boreholes are not assumed by the drillers and the prices are quite standarized. But there are some practical matters that could affect drastically the final results. Such as the particular case, that I want to share.

    There was one time that a Municipality (local government) invest in a water system project in order to supply a community. In the first stage, a hydrogeological study was hire and the drilling site was defined. In a second stage, the procurement was oriented to complete the construction of the different components of the system (well construction, conduction line, storage container, distribution network). It is very important to mention that the community was involved during the whole process. At the beginning, the water well rate was around 11 m3/hr, but after few days of completion, the discharge rate decreased considerably. Then, the contractor assumed the replacement of the well, as the community inferred the failure to a bad implementation of the gravel packing. All this happen because there was no supervision involved and neither the municipality engineers were trained for that.

    What I want to emphasize is the importance of knowledge that has to be managed in this matter, in order to achieve the best results.

  • #16633

    Hello everybody,
    In principle, the contract to be concluded must take into account a number of the prerequisites which constitute a substructure of the envisaged contract in particular, the hydrogeological knowledge of the drilling site that may be available from the Ministry in charge of water or other resource structures that evolve in the field and history of drilling already carried out in the region example on the percentage of successful wells.
    Even before the applicant enters the bid, he must collect a number of useful information that will give him a certainty of the presence of groundwater, by doing their own assessment / survey of the site to have specific ideas. the work that awaits him in order to properly negotiate the costs of the wells
    Thus, the contracts must be clearly established on the ground knowledge and must contain clearly a few clauses on successful wells and not. Only productive wells will be paid after verification.
    Francoise

  • #16638
    Profile picture of
    ouche
    Participant

    Hello,
    The fear associated with paying for dry boreholes is that some drilling contractors (especially the brief-case companies) may not mind submitting claims for dry boreholes, and not bother doing a good job. At least he gets paid something. If he knows he is getting a certain percentage of the contract sum even if he doesn’t do a good job, then he may as well do the shoddy job. These are one of the fears in Nigeria, hence no payment for dry boreholes. However, we are revising our procurement guideline and contract management process to ‘weed’ out these brief-case companies. Strengthening our contract management processes will also involve capacity building of government partners for better supervision of drilling of boreholes.

    Also most companies bidding do not apply some of the pricing and costing considerations as discussed in the reading materials. As such we end up with unrealistic bids to work with. Some drilling contractors have abandoned their contracts because of very low bids they had submitted

  • #16640
    Profile picture of
    giftjasonwanangwa
    Participant

    On the other hand, can’t numbers of dry holes be minimised if all procedures are followed and no shortcuts made? On both parties (Contractor and client), I mean. Seriously, you will encounter many dry holes if you drill without doing geophysical surveys or hydrogeological desk studies but just relying on experience. Some drillers even disregard information given to them by the villagers who have lived in those concerned areas for many years! Should such people still be compensated for hitting dry holes???? Much as I agree (after points and ideas shared in this course) to compensation or costing for dry holes encountered, I strongly feel there is still need for clauses in drilling contracts that ensure all hydrogeological work and procedures fully done for payments for dry holes to be cashed out. Even in Malawi, depths reached given by drillers are sometimes questionable, even dry holes encountered are sometimes debatable. Drillers will always claim it is a dry hole if the allocated fuel is finished (might have been tampered with) or when they encounter a situation where they may lose drill bits due to boulders and expect the wrath of their bosses in town who know nothing about drilling but signing pay cheques. “Refund” for a dry hole would be better than the wrath of the bosses or being sacked from work.

  • #16644
    Profile picture of
    Diana Balderrama
    Participant

    Dear all,
    I thought a lot about the question, since I don’t really have field experience. However I made my own private research about it, what I found was very interesting because there is no no disaggregated information on well drilling costs.
    In fact, in Bolivia it works in the following way: the Ministry has the exclusive competence of the management of water resources, when it comes to drilling wells, it transfers the competence to the corresponding Municipal Government, which in turn can subcontract companies or not ( in which case the Municipality can drill wells directly under the Ministry’s supervision), but these contracts are called “turnkey”, so the costs incurred by the company are not disaggregated, if the company or the municipality itself failure, the allocation of resources is available in budgets as a lump sum, not per activity.

  • #16645
    Profile picture of
    Muna Umer Muhammed
    Participant

    Hi everyone!
    As I don’t have the field experience,but did collect information. Since every WASH related project whether planned or implemented should be informed to the WASH Cluster with cooperation of Ministry of Water and Sanitation.Every WASH project has to plan to conduct a detailed technical assessment to
    identify the gaps for the current WASH infrastructure within the targeted
    governorates, and to propose more realistic interventions of the funding. The adopted
    methodology for the assessment are: looked into problem analysis in the working areas through a
    consultation process, reviewing recently conducted studies, program reviews and using information
    from other actors, before the start of project to understand underlying causes of the issues faced by the
    communities. Plus, studying the targeted location aquifers and their functionality rate. The key findings from the assessment will be the benchmark for the project and also will
    be serving for the concrete activities for drilling boreholes and Sanitation. The costs are always highly suggested to use the method of paying the bill of quantities (BoQ). I believe the key restricts are time, cost, quality and ownership but should always aim for certainty of long term sustainability of the boreholes.

  • #16646
    Profile picture of
    dotun
    Participant

    As Amrita mentioned contractors do tend to load their quotation such that most of the cost is in the preliminaries but such bids should be rejected and the contractors asked for a realistic pricing of the items.

  • #16647
    Profile picture of
    dotun
    Participant

    Michael Banja from South Sudan thank you for your posting about contractors exaggerating the drilled depth to cover the cost of dry holes and for pointing out that this may probably be due to poor supervision, siting and lack of hydrogeological data. And that it can be overcome by following proper procurement procedure and strengthening the supervision. I totally agree.

  • #16648
    Profile picture of
    dotun
    Participant

    Dear Francoise thank you for your posting. The contractor doing his pre-bidding study to know the ‘certainty’ of getting groundwater in the project area as you suggested may not always be feasible. In some geological terrains, such as in consolidated sediments and crystalline rocks areas, the occurrence of groundwater is not always certain. So it is suggested that the client shares the risk of the possibility of a dry hole as it may not be the fault of the hydrogeologist or the driller. Some participants have suggested paying the contractor 50% of price of the borehole but paying the contractor for the work done according to the boq until the borehole is declared abortive is a more equitable way.

  • #16649
    Profile picture of
    dotun
    Participant

    Dear Ouche, you expressed concern that the driller knowing he will get paid for a dry borehole may therefore do a shoddy job. The suggestion that drillers be paid for dry holes not due to their own inaction assumes that effective supervision is in place and that the driller will be certified to have carried out the work as specified. You rightly pointed out that contract management process needs to be strengthened and the capacity for supervision increased. Thank you.

  • #16650
    Profile picture of
    dotun
    Participant

    Dear Gift
    You asked ‘can’t the number of dry holes be minimised if all procedures are followed and no shortcuts made?’ The Principles of Cost Effective Boreholes are aimed at minimising wastage in drilling, including the number of dry holes but as earlier stated, there are some difficult groundwater terrains and dry holes will sometimes be encountered.The supervisor should advice on the situation. Similarly it is the responsibility of the supervisor to decide the final drilling depth, not the driller’s who can, when the fuel tank runs dry declare the borehole also dry. It all boils down to supervision. The quality of the product is as good as the supervision.

  • #16651
    Profile picture of
    dotun
    Participant

    Dear Diana and Muna Umar
    Thank you for your contributions. I hope from your readings and comments posted by other participants on the forum you are getting a feel for what happens in the field.

  • #16652
    Profile picture of
    dotun
    Participant

    Dear Gabriella
    Thank you for succinctly summarising in your narration what I was trying to say and I quote you ‘All this happen because there was no supervision involved and neither the municipality engineers were trained for that’. You nailed it on the head.

  • #16663
    Profile picture of
    Pound
    Participant

    Interesting topic! I suggest subsidy from government agency or insurance for failed borehole instead of increasing price for succeed borehole. However, it would be not easy to set the suitable rate for subsidy or even insurance plan, the integrated plan such as consulting with other field of experts as economist and statistical specialist would be helpful.

  • #16676
    Profile picture of
    yakassim
    Participant

    It will not be a good approach to pass unto the driller the cost of failed (dry) boreholes, else as mentioned it will definitely deter contractors from taking up drilling jobs in very difficult terrains. A certain percentage of the price of the successful borehole should be paid for a dry borehole and this must be based on evidence of professional work done by the siting teams.

    • #16719
      Profile picture of
      dotun
      Participant

      Dear Yakassim
      Thanks for your comment. I agree with you that it is not right to pass the cost of a dry borehole to the driller when the cause is not due to him. You suggested that a certain percentage of the cost of the successful borehole should be paid to the contractor for a dry hole. How can the appropriate percentage be determined? This can only be determined by measuring the amount of work the contractor had done before the borehole was declared abortive based on the priced on the bill of quantities.
      Best wishes, Dotun

  • #16681
    Profile picture of
    seec1587
    Participant

    In Trinidad and Tobago, all well drilling are outsourced. The contractor is given the borehole location at the time of pre-bid. Thus, they are not penalized when they have drilled a dryhole. AFter the drilling phase, there is the Development phase (which includes the Well Development, Civil, Mechanical and Electrical) which is almost the same price as the Drilling phase. If he drills a dryhole, then he will only get 50% of the overall bid price. To compensate for that, they front load the cost in the drilling phase to recoup as much money as possible in the event that they drill a dry borehole. This may have dire consequences though as during the Evaluation of their bid, it maybe rejected as being unrealistic. Thus, there will be no opportunity for him to drill and hence, the company will not be viable if drilling is its main operation.

    • #16720
      Profile picture of
      dotun
      Participant

      Thanks for your contribution
      If the pricing of the different items on the bid is unrealistic, it should be rejected and the reasons for rejection should be pointed to the contractor. With time the drillers will realise the need for realistic pricing and a robust and professional drilling sector should emerge.

      • #16750
        Profile picture of
        seec1587
        Participant

        Dear Dotun,

        Thank you for your response. Unfortunately in our evaluation process, we do not evaluate based on line items but on the different phases such as Drilling Phase, Development Phase, Mechanical Phase etc. So the contractor tends to hide his costs conveniently in order not to be disqualified. They are fully aware of our evaluation process as it is standardized. I will bring your suggestion of evaluation by line items to my managers as we could look into this possibility. Thank you for the suggestion.

  • #16686
    Profile picture of
    Noe REOUEBMEL
    Participant

    Hello every one.
    In our case, my organization do not pay the failed boreholes. All the risks are in the contractor side. For this, in the bedrock area, the unit cost of borehole is high.

    • #16721
      Profile picture of
      dotun
      Participant

      Dear Noe,
      Just as you said not paying for dry holes drives up the drilling cost. As I have stated in other responses it is better that boreholes are supervised and drillers paid for work satisfactorily carried out.
      Dotun

  • #16690
    Profile picture of
    Badho Nsiama
    Participant

    In my opinion for a defective drilling the loss must be shared by the contractor and the client half by paying 50% of the contract cost.
    This is to reduce the risk of the contractor seeking reimbursement for the loss on positive drilling.

  • #16693
    Profile picture of
    Muhammed.Ali
    Participant

    in my experience, we had reimbursed the contractor close to %50 of the total cost for a dry borehole.
    the required depth of the borehole was set to be no less than 300m, what are some of the most apparent indications of a dry borehole when drilling goes this deep into the ground? (i.e how to know when to stop and not go any further?)

    • #16724
      Profile picture of
      dotun
      Participant

      Dear Mohamed,
      For a 300m hole I suspect you were drilling in sedimentary terrain using rotary mudflush drilling. With such a method it is difficult to tell whether the borehole is dry or has the desired amount of water until the borehole is lined and developed. In most cases from the hydrogeological study the depth of the aquifer (sand, gravel, limestone, volcanic ash)has been estimated. When that depth is reached and surpassed, and the expected aquifer material is not encountered, the viscosity of the drilling fluid and the penetration rate do not indicate an aquifer, then it may be concluded that the borehole is abortive. However, to be very certain in some cases,the borehole has to be lined and a pumping test carried out. If it gives much lower yield then designed then it is declared abortive. This is not the driller’s fault and should be paid for the work carried out as outlined in the bill of quantities.
      Dotun

  • #16696
    Profile picture of
    Dahaile
    Participant

    Following the high borehole drilling failure rate in one of the Ethiopia region one of idea brought to the table was to pay only for the successful boreholes. We were requested by our donor’s that we need focus on projects where the value of money would be maximized.
    However, our partner was not in a position to accept this idea. Because groundwater investigation equipment were limited even at government and private enterprises. So it would not be feasible to pose this to contractors’. On the other side contractors would probably double the drilling cost. Moreover, there are only few companies that do both the groundwater investigation and drilling works. Therefore whenever such contracts advertised only few companies that would apply for the work whereas other drilling companies would be out of the business.

    • #16723
      Profile picture of
      dotun
      Participant

      Dear Dahaile
      Thank you for your contribution. Many donors are ignorant of the nature and complexity of groundwater. They are also not aware of the need for effective supervision. They therefore offload the responsibility for siting on the drilling contractor and adopt the strategy of “no water no pay”. The contractor in turn loads his price to cover the risk of dry holes.As a result, drilling costs escalate. As the contractor is not paid for dry holes, he does not provide the data on dry holes – valuable information for future projects is lost! Dry holes are not accounted for in the project evluation report. This gives a wrong impression of drilling success rates or costs. A project sets out to drill 50 holes and 50 wet holes are accounted for. It does not say how many boreholes were actually drilled to get the 50. So there is no real evaluation of project success and no lessons learnt that can be used to fine tune future projects. The partner rightly rejected the concept of no payment for dry holes. Dotun

  • #16718
    Profile picture of
    Toheed
    Participant

    In my opinion, this should based on case to case, i.e, the areas, where the chances of failure of bore hole is high, the contractor should be paid 50% of the dry borehole while the areas where the past examples of bore failure are low, the contractor should not be paid for that dry bore.
    if the contractor held accountable, they will consider all the pre- requisites before bidding and start drilling. if we leave the contract flexible, that might also increase the chances of failed borehole as they will know that in either case they will be paid.

  • #16722
    Profile picture of
    Rodong
    Participant

    Based on experience, my view is that shared risk for borehole failures should only be considered for contractors working in locations or areas that have already mapped as water stressed. The failure rates within the area, could be partly used to guide the percentage of risk sharing between the contractor and employer. This is the best way to ensure that communities in water stressed areas are not marginalized. Efforts to reach disadvantaged communities with services in a key to achievement of multiple SDG goals.

    However, to ensure efficiency of service without loss of money to corrupt tendencies, the contractor should assumes 100% risks for drilling in ordinarily water-rich areas . This also will ensure the contractor provides adequate technical capacity and diligent workforce for investigation.

    • #16773
      Profile picture of
      Kerstin Danert
      Participant

      Rodong – you use the terms “water stressed” and “water rich”. Can you be more specific about what type of hydrogeology you are referring to?

  • #16746
    Profile picture of
    Jawaher
    Participant

    Many organizations avoid borehole drilling for many reasons such as the high cost of drilling, the difficulty of calculating the real cost because of the problems the accompany the borehole drilling.
    In Yemen the contractors start drilling with borehole diameter for 8 inches, as a pilot drilling, if the borehole is failed the client gives the contractors 35% of the cost of contract.

  • #16749
    Profile picture of
    Americo muianga
    Participant

    Dear All,
    I agree with Mr. Kinezeme, that we need to establish a success rate of borehole drilling per district or province.
    Borehole data base can help to visualize areas when the negative boreholes are occurring and Government and donors can support specific geophysics studies for those areas.

  • #16762
    Profile picture of
    GetachewHM
    Participant

    Many organizations in Ethiopia don’t prefer to work in hydro-geologically challenging areas where borehole success rate is low. For those who are willing to do the drilling work, they factor out the risk of failure into drilling prices. In UNICEF-Ethiopia, what we do is we carry out a proper groundwater study and we identify the risk of borehole failure. After analyzing the risk, the risk is shared between the client and the contractor. If the risk of failure is 25%, then the contractor will not be paid for 75% of the failed boreholes while payment will be made for 25% of the boreholes based on the work done (mobilization, drilling, etc.). Sometimes the study is contracted to the drilling company together with the drilling contract and if the contractor considers the areas is feasible, the contract will be paid only for productive boreholes. The other form of contract applied by other organizations is drilling companies will be paid based on the work they have conducted that don’t include supply and installation of casings, screens, gravel, etc. for non-productive boreholes. The acceptable way is to have a very good understanding of the groundwater availability and challenges related to drilling in the area.

    • #16772
      Profile picture of
      Kerstin Danert
      Participant

      Getachew – it looks like UNICEF Ethiopia is trying to find ways to overcome the challenges of drilling in difficult areas, with a mix of the client and the contractor taking the risk depending on the contract. Can you explain once again – perhaps with a fictive price, what happens in the case of a risk of 25%? Who calculates this risk and will it be revised if more wells become more successful?

  • #16765
    Profile picture of
    Bhawna
    Participant

    I am managing the donor funded project on Borehole construction in Nigeria. Last year, more than 800 HPBH have been drilled. Although percentage of abortive boreholes vary across various region of the state, however abortive boreholes constitute at least 20% on an average. As per project condition, contractors are not being paid for abortive which has always been a area of concern for contractors. However we also face the issues with false claims from contractors about capacity in terms of equipment’s and human resources. Issue of abortive have been highlighted by higher authorities but their area again possibilities of false claims. However I agree with some suggestion of part payment, subject to appropriate agreement on means of verification for abortive points.

    • #16771
      Profile picture of
      Kerstin Danert
      Participant

      Bhawna – you raise very important points. The drillers are concerned about non-payment for abortive boreholes. The client is concerned that the driller is not being honest about their equipment and human resource capacity. Unfortunately this does not bode well for trust and cooperation, which is essential for good quality work. Are there ways out of this difficult sutuation? This is the sort of issue that you could explore further when we get to Module 5 (on action for professionalism). I would argue that there is need to try to address the problem, for both sides. What about trying to set up a very thorough pre-qualification process so that the drillers are properly vetted? It can be a team to do this, and it does not have to be done every year? And once the qualified drillers have been selected, there could be some dialogue between you, the client, and the drillers to explore ways to minimise the risk to the drillers. This would also enable them to make more realistic cost estimates.

  • #16770
    Profile picture of
    Kerstin Danert
    Participant

    Bhwana – you raise very important points. The drillers are concerned about non-payment for abortive boreholes. The client is concerned that the driller is not being honest about their equipment and human resource capacity. Unfortunately this does not bode well for trust and cooperation, which is essential for good quality work. Are there ways out of this difficult sutuation? This is the sort of issue that you could explore further when we get to Module 5 (on action for professionalism). I would argue that there is need to try to address the problem, for both sides. What about trying to set up a very thorough pre-qualification process so that the drillers are properly vetted? It can be a team to do this, and it does not have to be done every year? And once the qualified drillers have been selected, there could be some dialogue between you, the client, and the drillers to explore ways to minimise the risk to the drillers. This would also enable them to make more realistic cost estimates.

  • #16776
    Profile picture of
    Jacob kipkeny
    Participant

    Sitting and drilling of boreholes are separate contracts and mostly the government Hydro geologist perform sitting of the boreholes. The contractor is responsible for drilling a site already identified hence if the a dry borehole is drilled the contract will be paid for the work done.
    In some situation in the tender documents the rate of success of nearby boreholes is provided to the contractor to allow them to make decision for the drilling and aid them in tendering process.

  • #16777
    Profile picture of
    Americo muianga
    Participant

    Hi Jacob,

    I agree with you, but in case of Mozambique, the contractors are responsible for sitting and drilling.. The BOQ includes a geophysical investigation for the siting borehole by the contractor. The contractors are not paid negative boreholes, only the positive.

    • #16837
      Profile picture of
      Kerstin Danert
      Participant

      Jacob – intersting to hear this practice in Mozambique. I would be also intersted to know about the drilling costs, and variations in cost across the country. I would also argue that the contractors are paid for the negative boreholes. But that this “payment” is simply hidden in the cost of their positive boreholes. Why do you think that this practice has developed?

  • #16792

    Unicef Madagascar organized yesterday, March 28, 2018 a forum of exchange “A national forum of the water to find a solution to the problems of the south” to find a durable solution with the research of the underground waters in the south of the island, for reduce costs in various studies, given the multiple constraints related to groundwater scarcity and quality. The success rate of drilling in this region is very low, due to the high level of water salinity and low flows, both related to the complexity of geology and regional hydrogeology. These 4 steps help to optimize the cost of drilling

  • #16795
    Profile picture of
    GetachewHM
    Participant

    Dear Dr. Kerstin,

    The risk is assigned for every cluster of drilling contract based on the likelihood of success in striking water as indicated in the groundwater assessment report. The groundwater study could be conducted by the client or the drilling company itself and indicates success rate. The risk is calculated based on the proportion of the number of successful boreholes from the total number of boreholes to be drilled. It is assumed that the average cost of drilling a borehole is not varying much between the boreholes to be drilled under a single lot.

    Example:
    If eight boreholes are contracted to be drilled in one lot and the groundwater study indicated the success rate is 75% (25% of the wells have a risk of failure), and if up to two of the eight boreholes failed, the contractor is entitled to be paid for all the eight boreholes drilled including the failed one or two boreholes. However, payment for the failed boreholes is based on the actual work done and the rate calculated based on the BoQ (Eg.: site clearing, mobilization/demobilization, drilling, etc. ). If three boreholes are failed, the contractor will not be paid anything for the third negative borehole but will be paid for two failed boreholes and the other three productive boreholes.
    The risk is calculated based on the proportion of the number of successful boreholes from the total number of boreholes to be drilled. It is assumed that the average cost of drilling a borehole is not varying much between the boreholes to be drilled under a single lot.

    • #16838
      Profile picture of
      Kerstin Danert
      Participant

      Dear Getachew,
      This is very interesting. I now get the practice that you are following. It sounds to me like a compromise between paying them for their work, and passing some of the risk onto them. However, I will question you as to why the drillers pay for the unexpected failed well, even though the well siting was done by the client?
      I also assume from your response that you tender in lots that are in relatively close proximity with similar hydrogeology. Is the borehole design adjusted on site in line with the conditions found (e.g. depth, positioning of screen)?

  • #16809
    Profile picture of
    Renata Raad
    Participant

    In Lebanon groundwater is widely available, however, at highly variable depths. In some locations you may find groundwater at > 500 m depth. This is due to the karstic nature of rocks and steep topography. Naturally the investment and operational costs in such areas is very high. We usually avoid drilling in such areas and rather look into the possibility of establishing a conveyance system from other areas. Other options are rainwater harvesting and use of surface water.
    Indeed, in Lebanon we had failed boreholes, even in areas where we had successful wells. Sometimes even hydrogeological studies and experts familiar with the locations can fail to provide the right drilling site. The selection of the drilling contractor itself can lead to failures.

  • #16817
    Profile picture of
    Muna Mirghani
    Participant

    Dear Colleagues,
    sorry to enter late in this interesting discussion . the question here is “who is accountability for failed wells ?”
    Please correct me, but I believe that the well siting and drilling are two separate jobs and need not be done by the same company. Drillers/ contractors are to instructed by a consultant, expert hydrogeologist or the Ministry hydrogeological office on the drilling site.
    because of cost and lack of data, many drilling companies face difficulties in accessing required information to assess site suitability. Government hydrogeological departments in my country are the only body authorized to prepares hydrological investigation and monitor aquifers.

    • #16836
      Profile picture of
      Kerstin Danert
      Participant

      Dear Muna – thanks for responding. Yes, the question of accountability is central to this discussion. I am also of the opinion that siting and drilling should be done by two seperate entities. However, in order to cut costs, in many countries the responsibility for siting is also handed over to the driller. It may seem to save money in the short term, but in the long term, the costs of failed boreholes need to be recovered, and so the driller has to raise their costs. Another aspect (not mentioned so far) is the need for the siting process to engage with the communities as to an appropriate location. I have seen exmples of wells drilled far from communities next to the swamp as this was a very safe bet for striking sufficient water – rather than doing systematic siting to find locations close by.
      Lack of data is coming up over and over and over in this course. What can be done to change this I ask?

  • #16845
    Profile picture of
    GetachewHM
    Participant

    Dear Dr. Keristin,

    The drilling company needs to understand the hydrogeologic situation and the risk of drilling non-productive wells. They are involved in the contractor if and only if they are convinced with the proposal provided by the client.

    The borehole design could be modified in the field with the understanding of the drilling company but without changing the risk sharing indicated in the contract agreement.

    • #16857
      Profile picture of
      Kerstin Danert
      Participant

      Dear Getachew – for sure the driller needs to understand the risk. And I know of drillers that will not drill in certain areas for certain clients as it is too risky. I just send out the borehole costing model by email. This may also be something to share with the drillers as costs are explored.

  • #16861
    Profile picture of
    Ayman
    Participant

    Hallo
    the definition of the well location is determine by the Ministry depending on different methods.
    The minister hire the driller to achieve the drilling with specific techniques and for this reason the ministry is responsible if the well is day and the ministry pay 100% of the cost even if the well is dry. but if the well failed from the bad work of the driller then the driller have to do another one, that is mean he is responsible in this case

    • #16914
      Profile picture of
      Kerstin Danert
      Participant

      Dear Ayman – thanks for your response. I agree with you almost fully. However I would like to check. When you say that the Ministry pays 100%, is this 100% of the cost of the work done according to a bill of quantities, or a fixed price in the contract? It is good that the driller needs to re-drill if the company undertakes poor quality work. One should indeed should not pay for shoddy workmanship!

  • #16896
    Profile picture of
    Ruslan
    Participant

    Hi everyone! I would recommend contract officer to use different payment strategy depending on the scale of the contract.
    For example:
    1 to 5 boreholes drilled contract : 100% for each borehole, allocating 20%-30% of funds for such uncertainties
    5 to 50 boreholes drilled contract: 50%-60% for dry boreholes, allocating 20%-30% of funds for such uncertainties
    51 and more boreholes drilled contract: 40% for dry boreholes, allocating 20%-30% of funds for such uncertainties and hiring hydro-geologists for
    better results .

    • #16913
      Profile picture of
      Kerstin Danert
      Participant

      Hallo Ruslan – thanks for your response. Do you think that this can be appllied to all hydrogeological contexts, or is there a specific context which you are referring to? And I am curious that you only consider hiring hydrogeologists for contracts of 51 and above. What is the rational here, and why would the lot size of a contract make a differnence to your siting procedures. Looking foward to hear your thinking.

  • #16923
    Profile picture of
    Ruslan
    Participant

    Hello Kerstin , thank you for your question . Of course the payment strategy in reality is more complicated and may include more ” steps ” to meet the bunch of goals pursuing local drillers capacity development and needs of the community, etc.

    • #16926
      Profile picture of
      dotun
      Participant

      Hi Ruslan,
      Dont you think it is less complicated if once the driller is engaged based on the priced bill of quantities and if the borehole should be dry through no fault of the driller, that he should be paid for the work done until the borehole is declared dry. For instance, if he mobilised and drilled to 60m depth and the borehole declared dry at that depth, that he should be paid for mobilisation and for drilling to 60m depth based on the rate in the bill of quantities. This may be about 30% of the price of the completed successful borehole. It is fair to the driller and to the client. Some participants have suggested paying 50% to the driller but the cost incurred by the driller may not be up to 50% and therefore not fair to the client. The bill of quantities should be used as a guide. What do you think?
      Dotun

  • #16935
    Profile picture of
    Ruslan
    Participant

    Hello Dotun,
    Thank you very much for sharing your contract strategy, I agree that it is less complicated. And it will cover all expenses of the driller. So the cost of the dry borehole will be linked to the bill of quantities.
    Best

  • #16956
    Profile picture of
    yakassim
    Participant

    Professionally I believe strongly that the cost of failed boreholes be paid contractors. This can be based on a percentage of the full cost of the successful borehole. This is because it takes resources to drill a fail well. Also if this is not addressed, it will scare contractors from taking up jobs in difficult terrains or they may quote very high in order to break even or make profit.

    • #16965
      Profile picture of
      dotun
      Participant

      Dear Yakassim,
      I agree with you that the cost of a failed borehole should be paid to the contractor if the cause of failure is not due to his action or inaction. You said this could be a percentage of the cost of the successful borehole. In my response to Ruslan’s last posting I recommended that the percentage should be determined by the measured quantity of work done before the failure and the cost due to the contractor calculated based on rates in the bill of quantities. Ruslan agreed with the suggestion and I hope so do you.
      Dotun

  • #16989
    Profile picture of
    Renata Raad
    Participant

    Dear colleagues
    In the case of UNHCR we are bound by rules and regulations that doesn’t leave a room to hide the costs occurring on failed boreholes. Pricing is based on a tender process with clear TOR and BOQ which leave small room for not being transparent.
    When a borehole fails we have the duty to justify this to our donor and we go through a process in which we identify the reasons of the failure: (bad siting, inadequate drilling methodology, equipment, bad development, etc. and then endeavor to overcome it in close coordination with our donor and the water authority to which we intend to handover the well.
    Drilling is also supposed to be supervised by a quality control person who should inform if the drilling is not abiding the recommended/agreed upon methodology that is based on the geology.
    Cheers

  • #16990
    Profile picture of
    Renata Raad
    Participant

    Dear colleagues
    In the case of UNHCR we are bound by rules and regulations that doesn’t leave a room to hide the costs occurring on failed boreholes. Pricing is based on a tender process with clear TOR and BOQ which leave small room for not being transparent.
    When a borehole fails we have the duty to justify this to our donor and we go through a process in which we identify the reasons of the failure: (bad siting, inadequate drilling methodology, equipment, bad development, etc. and then endeavor to overcome it in close coordination with our donor and the water authority to which we intend to handover the well.
    Drilling is also supposed to be supervised by a quality control person who should inform if the drilling is not abiding the recommended/agreed upon methodology that is based on the geology.

    On another note, in areas where groundwater is lacking, or is at deep depth, it might be wise to consider other possibilities such as the use of treated surface water, rain harvesting etc. Rather then insisting on drilling wells that might not be successful.
    Cheers

    • #17008
      Profile picture of
      dotun
      Participant

      Dear Renata
      Thanks for sharing this information about the procurement procedure in UNHCR. This is the way it should be. When a new borehole does not deliver in quantity or quality the reason should be determined so that steps can be taken against repetition of such failure.
      Best wishes.

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