Stands for Engineering, Procurement and Construction Management. An EPCM contract is essentially a professional services contract.

The focus of an EPCM scope of services is on:

  • Setting the principal’s expectations for the project;
  • Defining the boundaries of the EPCM’s role and responsibilities;
  • Identifying when the EPCM must return to the principal for direction or approval;
  • Setting out what the EPCM can and cannot do when it is managing contractors on the principal’s behalf; and
  • Ensuring that the EPCM is communicating effectively with the principal.

A common challenge faced by both principals and EPCMs is reaching a common understand of the limits of an EPCM’s authority. Typically:

  • The EPCM is engaged as a principal’s project manager;
  • The EPCM has a contract only with the principal;
  • The EPCM’s contract with the principal gives the EPCM authority to manage the other contractors for the principal;
  • The contract sets out exactly what the EPCM can and cannot do in the name of the principal;
  • The principal can give more authority to the EPCM or take it away at any time; and
  • The EPCM cannot increase or decrease its authority without permission.

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