Project Appraisal

Technical Analysis

Mona Iyer
Asst. Professor, School of Planning
CEPT University
Ahmedabad
 Project Issues - Technical
• What is the expected level of users?
• How much would the users be willing to pay for use facility?
• How much would the users save (in terms of operating costs and
time saved) by using the facility?
• What should be the alignment , layout?
• Should all the phases of project implemented simultaneously?
• What should be the design of the facility taking into consideration
the traffic characteristics (loading etc.)?
• What would be the construction cost and subsequent operating cost
for the facility?
 What should the process achieve?
• Reduce “unknowns” and “assumptions”
• Identify and address all technical risks that can affect
the project
• Set out obligations, payments, rewards and penalties
• Project development is more than just preparing a
Feasibility Report and conducting a bidding process
to select a concessionaire
– Any issue that can derail a project should be identified and
addressed - including land, R&R…
 The Process
• Finalise desirable technical configuration
– Alignment and road geometrics
– Design Requirements
– Lane configuration and composition
• 4 lane/6 lane
• Service roads
• Junction improvements, bridges, ROB/RUB
– Toll plaza – optimal location, numbers, design
– Additional facilities – bus and truck lay-bys, highway
amenity areas
 The Process

• Estimate inputs for project viability assessment

– Traffic – volume, composition and growth
– Operations and maintenance cost
– Construction Cost and Project Cost
• Input for financial viability – impacts structuring decision
• Reflected in the Concession Agreement

• Assess project viability and finalise project structure

• Compile data pre-requisites necessary for bidding
• Preparation of bidding documents
 Technical Assessment
• Important aspects
– Choice of Appropriate technology/Design
– Location and Site
 Key Steps
• Selection of Appropriate technology
– Technology Transfer Agreements
• Selection of Location and Site
– Preparation of project layout / Charts
– Broad Schedule for project implementation
 Technical Analysis
Demand Assessment

Selection of Appropriate tech Selection of Location and Site

Tech Transfer Site Development Issues

agreement/Collaboration Land, Cost, Rehab,construction

Project Layouts/Charts

Broad Schedule for Project Implementation

Financial Assessment
Selection of Appropriate Technology
Selection of Appropriate Technology
Capacity/User Demand (size)
Principal inputs available
(eg. Raw material,equipments, expertise)
Proven technology
Product Mix (Product /Byproduct)
Latest Developments
(does not req updation very soon)
Ease of Operation/Absorption
Ecological balance
Harmonious with social and
cultural conditions
Demand/Market condition certain/uncertain
Technology v/s suitable size, Input constraints
Cost/unit capacity (variation wrt cost), Incentives, financial and
manegerial resources of firm
Equipments/Material/Utilities Availability and Supply Programme
Ease of transporting (raw/processed/auxilliary material)
Utilities-Fuel, Power,Water etc…)
Variations in Size/Capacity
Variations in quality/service level (defined user market- profits)
Flexibility to change with demands (additional cost)
Type of pollutants
Means to mitigate
Ease of getting clearances
Arrangements for Technology
Transfer/Collaboration
Duration of agreement, termination,
force majeure

Nature of support during

design, construction, operation, training

Performance Guarantee –
Capacity and Quality of products

One time Licensing Fee + Royalty

Benefits of continuing R & D if any

Restrictions on export/distribution

Management control - if technical

collaboration backed by financial

Preferred payment terms

Selection of Location and Site
Selection of Appropriate Location

Proximity to materials, markets

Availability of Infrastructure

Availability of Labour –
skill levels, rates, labour unions

Govt. policies, restrictions and

priorities
Climatic conditions, cost of env.
Miti measures

Selection of Appropriate Site

Cost of land, Availability of Land

Cost of site prep/dev/shifting of utilities

Cost of rehabilitatio
Project layout /Charts

Preparation of project layouts/charts

Functional preliminary
layout/alignment

Material flow diagram

Utility/communication/org chart

Proper utilization of space

Smooth operations
Minimization of costs
Safety of personnel
Broad Schedule for Implementation

Preparation of Broad schedule for implementation

Possible activities – resources and time

contingencies

Work schedule for plng of material , capacity and

investments