Brahmaputra Cracker and Polymer Limited (BCPL), executing the Assam gas cracker project, has said that revised schedule for completion and commissioning of the project and impact of pay revision of employees have led to the increase in EPMC (equal percentage of marginal cost) fees.

The issue came up for discussion during a recent meeting held to discuss the progress of the project.

Considering the recommendations of the Expert Committee for reducing the fees of consultant Engineers India Limited (EIL) and owner?s construction period expenses, BCPL explained that the enhanced EPMC fee is necessitated by the revised schedule for mechanical completion and commissioning and impact of pay revision of employees.

The revised schedule has resulted in increasing the head office man-hours and site man-hours by 10 per cent and 27 per cent respectively.

Further, pay revision of the employees has raised the overall compensation by 89 per cent and thus contributed substantially towards the increased fee.

The participating sides felt that the EMPC fee was on the higher side.

The Planning Commission said that the debt and equity should be raised at least proportionally to absorb a part of the cost escalation. The Department of Chemicals and Petrochemicals (DCPC) explained that the funding arrangement has been made so as to ensure the bankability of the project.

In reply to DCPC?s query of impact of railway siding on time and cost overruns, BCPL said that it would not have any impact on the project completion as the land is in the process of being acquired.

In view of the initial delays and special conditions prevailing in the region, BCPL has already submitted a proposal for revised project cost along with revised commissioning schedule. As against the original target of commissioning by April 2012, BCPL has submitted the revised schedule for mechanical completion and commissioning by July 2013 and December 2013 respectively.

The project, which is being directly monitored by the PMO, has seen a progress of about 38 per cent till April.