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Cost Reimbursable Benefits of Operations & Maintenance contract of a leased FPSO?

asked Jul 6, 2014 in Commercial by josvanden (3,240 points)
What are the Cost Reimbursable Benefits of Operations & Maintenance contract of a leased FPSO?

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answered Jul 6, 2014 by Normandy (21,040 points)
By resorting to a fully Cost Reimbursable Method (CRM), Operating Company will have “open book” access to all of Contractor budgets and costs information at any given time.  This transparency will allow Operating Company flexibility in how Operation and Maintenance is being managed and executed in the way that best fits Company’s business goals and objectives.  The CRM will enable Operating Company to have a voice in how the operations will be run on a monthly and even daily basis.  This will allow Operating Company full control of what and when work will be done and how it is spent in accordance to the approved budget.  By having this control, costs can be closely monitored to ensure that budgets are met and return on investments is maximized.  In the long run, the CRM will result in lower costs of operation and maintenance.  The extra emphasis on cost monitoring due to the CRM will result in cost under-runs which will benefit Operating Company.
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