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HomeMy WebLinkAboutMiddle Kuskokwim Regional Energy Project Construction Phase Apr-Jun 2005Middle Kuskokwim Regional Energy Project Construction Phase AEA Project Number 380329 Quarterly Report April 1, 2005 through June 30, 2005 Submitted July 1, 2005 Sed 9) Be © hon af an sf a iP) = ea rs = R oy) i) i = eC) mY. ie) — Ne a a) Ke Alaska Energy Authority / Rural Energy Group Mike Harper, Deputy Director Rural Energy 813 West Northern Lights Boulevard Anchorage, Alaska 99503 Phone: (907) 269-3000 Fax: (907) 269-3044 MKREP EXECUTIVE SUMMARY This quarterly report serves as a Project Status Update for the period April 1, 2005 through June 30, 2005 with regard to project scope, schedule, budget, and related issues. ‘The baseline for this update is the Middle Kuskokwim Regional Energy Project (MKREP) Project Statement presented to the Denali Commission August 10, 2004 and subsequent modifications as specified in the Quarterly Report dated April 1, 2005. The scope of this project has remained substantially the same from the last quarterly report. Minor modifications have been incorporated in an updated Isswed for Construction design set dated June 6, 2005. Generally the project schedule remains unchanged — in terms of overall project length. There have been no significant schedule changes since the last report. See village details in the schedule section of this report. The anticipated substantial completion date remains December 31, 2005 and a final completion date remains June 30, 2006. The initial budget estimate for this budget was $12,500,000; the April 1“ quarterly report revised this estimate to $13,100,000. As of June 30, 2005, approximately $9,000,000 of contracts have been issued, of which $4,500,000 was spend during the last quarter. In general, this quarter’s procurements have been either at or under budget estimates, which keeps the project on track for a completion of $13,100,000. Therefore, we anticipate the final budget to be within 5% of the initial estimate. In May 2005, AEA conducted pre-construction community meetings in all seven project villages to discuss the project and community issues. Barge delivery of materials and equipment began June 15, 2005 and is on-going “up-the-river”; welder training of 15 trainees, from four project villages, began June 23, 2005 in Aniak; and field construction began June 23, 2005 in Aniak. Related Issues: Quality Planning/Assurance/Control Kuskokwim River Water Levels Apprenticeship /Training Program Fuel Prices Procurement Issues Pre-construction Community Meetings Modularization and Pre-Fabrication April — June 2005 Quarterly Report Page 1 MKREP SCOPE The baseline for the scope of this project is the August 10, 2004 Project Statement and subsequent project delineations outlined in the April 1, 2005 quarterly report. Minor design modifications have been incorporated in an Issued for Construction design set dated June 9, 2005. SCHEDULE Task Planned* Actual Projected Variance (days) 65% Design 7/15/04 7/15/04 | 0 Final Design Documents 10/22/04 10/22/04 07 fanned ed OO ¢ $900,000 11/10/04 55 $11,600,000 __11/30/04 3B Procurement (minor) 10/15/04 10/15/04 0 Procurement (major) 10/15/04. 12/15/04 Tee Shop Fabrication begins ‘11/1/04 1/15/05 as Field work begins 6/15/05 6/23/05 ie 8: — sae ee (23/05 Hie Aniak 9/15/05 9/15/05 <0> Chuathbaluk 10/ 1/05 10/ 1/05 <0> Crooked Creek 10/15/05 10/15/05 <0> Red Devil 9/15/05 9/15/05 <0> Sleetmute 10/31/05 10/31/05 <0> Stony River 10/ 1/05 10/ 1/05 <0> Takotna 10/31/05 10/31/05 <0> Intertie 3/1/06 3/ 1/06 aCe Final Completion «(6/30/06 6/30/06 <0> *Plan dates were updated in the April 1, 2005 quarterly report. The Baseline Schedule for this project was presented to the Denali Commission in the August 10, 2004 Project Statement. Field work in Aniak has begun and the dates of substantial project completion have not materially changed. April — June 2005 Quarterly Report Page 2 MKREP BUDGET Project Budget vs Actual Expenses $14,000,000 == | ‘Status Date - eee $12,000,000 ~—— —®- Actual Cost) 6/30/05 | —® Budget | $10,000,000 - Estimated $8,000,000 ~ | Procurement : $6,000,000 + Phase p> Field Construction — 7 Phase $4,000,000 | | $2,000,000 + | 7 | +— 8/1/04 11/9/04 =-2/17/05 = 55/28/05 9/5/05 12/14/05 3/24/06 Major procurement is substantial complete. All contracts let to date have been competitively bid using Alaska Statute 36 protocol. Starting mid-June the project shifted from procurement to field construction. The construction budget for this project was established in August 2004 at $12,500,000. As of June 30, 2005, approximately $9,000,000 in contracts has been issued. During this quarter procurements totaled approximately $4,500,000, which was within 1% of budget estimates. As the above graph depicts, we anticipate that the expenses should closely follow the original budget. We continue to anticipate that the project construction costs will be approximately $13,100,000 or $600,000 (4.8%) over the original budget estimate; however, we hope to realize economies during construction that may reduce this figure. In addition to the construction budget (AEA project number 380329) the following amounts have been previously encumbered or expended on activities in support of this project: Activity Amount Bulk Fuel Design (Phases 1 through 3) AEA 340227 $1,332,242. Power System Upgrade Design _. A 3502 _$ 465,000 ject Administration $ 275,000 April — June 2005 Quarterly Report Page 3 MKREP RELATED ISSUES The following issues warrant addressing in this report: Quality Planning/Assurance/Control Kuskokwim River Water Levels Apprenticeship/Training Program Fuel Prices Pre-Construction Community Meetings Modularization and Prefabrication Acknowledgements e QPAC In the area of Quality Planning/Assurance/Control (QPAC), AEA retained the services of several independent certified inspectors to site-inspect fabricated materials to ensure adherence to specifications and to independently verify contract values. The following table presents the inspection services and their project role: Contractor Services HDL Field Inspect Concrete Using Slump Test and Laboratory Crush Test Fabricated Metal Inspection Field Inspect of Pile Driving (Blow Counts) _At-Vendor Materials Inspection QA Services Welding Inspection _______ Coating Inspection Anvil Alaska Tank Inspection Coating Inspection Tank Welding Inspection oo Vendor Contract Compliance Estimators Plus Independent Contract Values for Labor, = Equipment, Intertie as STG, INC / Vendor Contract Compliance AEA Internal Peer Review Vendor Contract Compliance — ______On-site Module Inspection. AE&E, Inc Power Module Inspection Engineering Peer Review April — June 2005 Quarterly Report Page 4 MKREP e KUSKOKWIM RIVER WATER LEVEL In the previous quarterly report this issue was raised because of the potential for low Kuskokwim River water levels during July and August that could impact the project schedule. While this issue was a concern, currently river levels are at historical average and, therefore, are not anticipated to affect the project schedule. Normal snow pack, higher than normal spring rains and cooler temperatures in the Alaska Range have extended the snow- melt season and we do not currently anticipate river levels falling to critical levels. e APPRENTICESHIP/TRAINING PROGRAM AEA has joined forces with Village Safe Water, Alaska Native Tribal Health Consortium and the U.S. Department of Labor to utilize joint resources and to adopt The Rural Alaska Construction Training Apprentice Program (RACTAP). Starting in May 2005, the project’s construction management firm began workforce recruitment for this project. As a result, the project currently has 35 local hire applicants — and, of that number, 10 signed up for the apprenticeship training program. Currently 15 trainees, from four of the project villages, are in welder classes for related instruction in Aniak - at the local Joe Parent Regional Voc Ed Center. The training is being led by experienced journeyman trainers. The initial classroom phase of the training is anticipated to last three weeks, and upon completion, trainees will be assigned to field locations for on-the- job training. Subsequent on-the-job trade related apprentice training will take place throughout the construction of this project, in all the project communities. Voc Ed Facility in Aniak provided in-kind by Kuspuk School District April — June 2005 Quarterly Report Page 5 MKREP e FUEL PRICES Fuel prices continue to rise — and, as of late June, the cost of a barrel of oil reached $61, an all-time high. Fuel surcharges currently are ranging from 7 to 15 percent, which will negatively impact this summer’s project transportation costs. e PRE-CONSTRUCTION COMMUNITY MEETINGS From May 19" through 21% 2005 AEA representatives, and its construction management contractor, held public meetings in each of the seven participating villages to discuss the start of project construction and to answer any remaining community questions. Typical community questions regarded local hire, training, scheduling, status of permitting, scope changes, site control, sustainability, housing and in-kind contributions. For example, a meeting was held in Chuathbaluk at the City Hall with the Mayor, City Council and the City Council as well as representatives from TKC and the interested community members: The meeting in Sleetmute was held at the Traditional Council offices with its President and Council members as well as the President of MKEC, local pilots and other interested community members: April — June 2005 Quarterly Report Page 6 MKREP In Takotna the meeting was held at the Takotna Community Association offices with its management and members of the community. Additionally, in Aniak on June 2, 2005 AEA presented a comprehensive review of the project at the TKC Land Committee meeting. The presentation was well received and the Land Committee passed a resolution recommending that TKC’s Board of Directors approve an Easement Agreement with MKEC for the intertie between Sleetmute and Red Devil. e MODULARIZATION AND PREFABRICATION All five modular, self-contained powerhouses were fully-assembled in Anchorage using production line techniques. All systems will be functionally tested, under actual load conditions, prior to shipment to the villages. Chuathbaluk powerhouse module prior to shipment (without roof) Powerhouse module engine room April — June 2005 Quarterly Report Page 7 MKREP Bulk fuel tanks, with integrated pump box systems, were fully-assembled by the tank vendors prior to shipment. ‘The integration of both fuel tanks and pump boxes into the same vendor contract has allowed for significant time and cost savings versus traditional field assembly techniques. 12,000 gallon self-diked tank with integrated pump box (doors on right) and electrical control panel compartment (on left). Note overflow piping on right top vented to secondary containment space. 24,000 gallon self-diked tank with integrated pump box during fabrication. April — June 2005 Quarterly Report Page 8 MKREP ACKNOWLEDGEMENTS We would like to take this opportunity to recognize some of the many organizations and individuals in the Middle Kuskokwim region that have thus far contributed to the success of this project. The level of hospitality, cooperation and support has greatly contributed to the success of this project. Antiak Steve Hill, Mayor of Aniak and Facilities Manager of the Kuspuk School District, has been extremely supportive of many aspects of the project. In addition to receiving an in-kind contribution of free housing in five villages, KSD has also opened their Aniak Voc Ed facility for apprenticeship training and housing. Chuathbaluk The City of Chuathbaluk donated housing as an in-kind contribution to the project. City Administrator Janice Perkins has been instrumental in keeping the city council updated and in working with AEA on many project related issues. Crooked Creek Janine Stewman of Crooked Creek has contributed to the project by helping out with the FONSI posting and by generously coordinating AEA’s activities in town. The Thomas’s of Crooked Creek, while not directly involved in the project, have helped out frequently with housing and site control coordination with the Crooked Creek Traditional Council. Red Devil Robert and Gail Vanderpool of Red Devil have been gracious hosts to the project and, although they are not a grantee, have offered AEA a discounted lodging rate. Robert’s knowledge of the region and its people has been helpful as has his flying ability. Robert has never been late and has made travel around the region both fun and efficient. Robert (Bud) Dolfay, of Red Devil People and Community, Inc. and member of the MKEC Board of Directors, has remained actively involved in the project on behalf of both organizations. Sleetmute MKEC Board of Directors and its former President, Henry Hill, were very supportive of the project site control and utility issues. We'd also like to thank Henry Hill for reducing his rates on lodging for construction crews. The Sleetmute Traditional Council and its President, Pete Mellick, brought the community together in support of the project and Sleetmute’s complex site control issues. Roy Carlson was instrumental in bringing power to the residents at Midway. April — June 2005 Quarterly Report Page 9 MKREP Stony River Mary Willis and the Stony River Traditional Council provided lodging rate discounts for housing of construction crews. Ward Sattler, former Manager of MKEC, provided support in the formative stages of this project. Takotna The Takotna Tribal Council, and Tribal Administrator Jan Newton, has provided general support and project coordination. The Takotna Community Association, and in particular Dick Newton and Nell Huffman, has also provided strong project support, logistics and coordination. The Kuskokwim Corporation TKC President/CEO Maver Carey and TKC Land Manager Rachel Klein have been extremely supportive of the project and its various site control issues. April — June 2005 Quarterly Report Page 10