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LONG INTERNATIONAL

Pipeline Project Claims Resolution Services

Long International’sClaims Analysis Process

Our professionals are experts in contract, insurance,and surety bond-related claims and disputesincluding their evaluation, analysis, preparation,and resolution.

Our claims analysis process is:

• Performed in Phases for better definitionand control of scope, time and cost;

• Systematic to ensure our analyses arethorough, our findings are credible, andour opinions are defensible; and

• Tailored to your specific needs regardingservices provided and resources utilized.

A World of Experience

Whether it’s the tundra of Alaska, the desertsof the Middle East, the heights of the RockyMountains, or the depths of the oceans, LongInternational’s professionals have been there.We have the experience you can rely on foryour claims analysis, preparation, and defense,as well as your pipeline project support needs.

Representative pipeline projects include:

• Alaska – Gas/Oil Pipelines

• Arizona – Water Pipeline

• Arkansas – Oil Pipeline

• Brazil – Gas Pipeline

• California – Gas/Product Pipelines

• Canada – Gas/Oil Pipelines

• Colorado – Gas/Oil/Product Pipelines

• Germany – Gas Pipeline

• Illinois – Gas Pipeline

• Kuwait – Gas Gathering System

• Montana – Product Pipeline

• North Carolina – Product Pipeline

• Oklahoma – Gas/Oil Pipelines

• Russia – Gas Pipeline

• Saudi Arabia – Oil Pipeline

• South Africa – Gas Pipeline

• Texas – Gas/Oil/Product Pipelines

• UAE – Dual-Flow Pipelines

• Utah – Gas/Oil/Product Pipelines

• Wisconsin – Gas Pipeline

• Wyoming – Gas/Oil/Product/Slurry/and Water Pipelines

Senior-Level Resources

Members of our select group of consultantstypically have 20 or more years of experiencein the construction industry and offer uniqueperspectives based on a combination of theirclaims consulting skills, technical expertise,and “mud-on-the-boots” practical experienceon pipeline projects.

Our professionals’ diverse experience allowsthem to function as:

• Your Support Staff

• Your Technical Advisor

• Your Solutions Provider

• Your Expert Witness, or

• A Neutral Third-Party

Phased Approach

Long International’s standard work plan forproviding engineering and construction claimsanalysis and expert testimony services on pipelineconstruction projects is to use a “phased approach,”as described on pages 2 and 3 of this brochure.Our task assignments are dependent on the workalready performed by our client, the availability of

project documentation,the issues in dispute,and the timing ofrequired work productsthat are defined by thearbitration/litigationschedule. Therefore, wecan make any necessaryadjustments to ourtypical work tasksdescribed herein.

OVERVIEW

Long International, Inc. is a specialized

consulting company whose primary focus

remains the same today as it was in 1996

when the firm was founded–analysis and

resolution of claims and disputes that arise

from the design and construction of major

capital projects worldwide. Our senior-level

personnel utilize their extensive experience

in pipeline projects, including installation,

project and construction management,

and cost and schedule control, to perform

analyses of disputed change orders, requests

for time extensions and schedule delay

damages, and productivity loss claims.

We have the experience you can

rely on for your claims analysis,

preparation, and defense, as

well as your pipeline project

support needs.

International Experts in Claims Analysis,

Dispute Resolution, and Project Management

for Process, Oil & Gas, Pipeline, Power, Industrial,

Infrastructure, and Building Construction Projects


During Phase II, we perform tasks required byour client as part of the arbitration/litigationschedule. In addition, other potential Phase IItasks often include the following:

1. Develop Document Database

2. Analyze Contract

3. Review Invitation to Bid, Job Instructions,Procedures, and Contractor’s Proposal

4. Review Drawings and Specifications

5. Review and Prepare (as required) a Listof Problems and Issues for Claims andCounterclaims

6. Review Approved and Unapproved/Outstanding Change Orders

7. Prepare a Preliminary List of Alleged Delays

8. Identify, Organize, and Review ScheduleData

9. Identify any Schedule Software ConversionRequirements

10. Review Schedule Analysis Methodology inany Submitted Claims

11. Identify and Review Key ScheduleInformation

12. Identify, Organize, and Review Contractor’sMan-hour Data, including Control BudgetPlanned Man-hours and Actual Man-hours

13. Identify, Organize, and Review BulkMaterial Quantity Data

14. Identify, Organize, and Review Cost Data

15. Develop Summary Schedule VarianceComparisons

16. Develop Macro Man-hour Variance Analysis

17. Develop Macro Quantity Variance Analysis

18. Develop Macro Labor Productivity Analysis

19. Develop Macro Cost Variance Analysis

20. Evaluate and Select Schedule AnalysisMethodology Options

21. Develop Phases III and IV Work Plans,Budgets, and Schedules

22. Provide an Overall Assessment of theStrengths and Weaknesses of Issues

During Phase I, we first review any pleadings,statements of arbitration, contractor claims, andowner statements of defenses and counterclaims.We then perform a preliminary review of therelevant project documents prepared prior to andduring the execution of the project. Dependingon the scope of our assignment, the documentsthat we often review include, but are not limitedto, the following:

• Documents that Describe the Scope ofWork and Basis for the ContractualRelationship that was Developed;

• Cost Estimates and Proposals;

• The Drawings and Specifications that wereUsed to Develop the Control Budget;

• Pre-contract Correspondence andMeeting Minutes;

• The Contract Terms and Conditions;

• Execution Phase Correspondence;

• Meeting Minutes;

• Monthly Progress Reports;

• As-planned Schedules and ScheduleUpdates in Native File Formats;

• Periodic Reports such as Manpower,Man-hours, Equipment Utilization, etc.;

• Job Cost Reports Including ControlBudgets and Monthly Cost Reports;

• Photographs and Videos if Available;

• Pay Requests and Invoices;

• Change Orders;

• Requests for Information;

• Submittals;

• Material Delivery Records;

• Subcontracts; and

• Other Relevant Documentation.

In addition, we interview key project personneland discuss more completely the project problemsand issues. If possible, we also like to visit theproject site.

It normally takes two to six weeks to performthis Phase I work. The Phase I duration, dependson the complexity of the case, the volume andavailability of key documents, and the availabilityof client personnel, as well as any other tasksthat our client requests to be performed duringPhase I.

After we have performed a preliminary reviewof the available documentation, we preparepreliminary observations and recommendationsregarding the claim and counterclaim issues,including our preliminary observations andopinions on the relevant issues. We also developa Phase II work plan, schedule, and budgetcorresponding to the scope of work necessaryto meet our client’s objectives. We then discussour proposed tasks to ensure that our approachis consistent with our client’s needs.

��Document DatabaseDevelopment andPreliminary Analysis

��Project Orientation, Preliminary Document Review, andWork Plan Development

Engineering and Construction Claims Analysis

Experience You Can Rely On...


The work products resulting from our detailedanalyses may take many forms, including but notlimited to claims/requests for equitable contractadjustments, reports supporting the defendant’spositions against claims, PowerPoint presentations,or expert reports. One or more expert reportsmay be required for arbitration or litigation.Rebuttal reports may also be required to critiquethe reports of other experts. In addition, somearbitrations require that opposing experts meetto attempt to narrow the issues. Reports may be

required to document this effort. For each claimdocument, presentation, or expert report, ourwork plan is as follows:

1. Prepare Draft Claim Documents/Presentations/Reports

2. Review with Client our Draft ClaimDocuments/Presentations/Reports

3. Prepare Final Claim Documents/Presentations/Reports

After performing preliminary analyses of thedocumentation and technical, schedule, andcost issues, Long International then performsdetailed analyses that support opinions expressedin our expert reports. The task descriptions thatare listed below are definitive analyses thatsubstantiate the preliminary findings, but theymay be tailored to the needs of our client, theactual scope of work and opinions required, andthe deadlines of the arbitration/litigation.

1. Prepare Issue Packages for Contractor’sClaim Issues and Owner’s Counterclaim Issues

2. Prepare Issue Summaries/Proof Charts

3. Prepare Detailed Narratives withDocument References

4. Develop Cause-Effect Relationships

5. Prepare Detailed Schedule Analysis

6. Prepare Detailed ProductivityLoss Analysis

7. Prepare Detailed Damages Analysis

Our Detailed Damages Analysis providesadequate detail and supporting spreadsheetsto fully explain the amount of the claim and/orcounterclaim. Damages may arise from a varietyof problems, and we endeavor to calculatespecific damages for each problem if possiblefrom the data available. The cause-effectrelationships linking the damages to theentitlement for each problem are demonstrated,if possible. We often develop a DamagesAnalysis Matrix for both man-hours and costs.This matrix delineates work activities and costtypes on one axis and variances between budget/contract values and actual/projected valuesalong the other axis. These man-hour and costvariances are then allocated to approved changeorders, pending change orders, potentialcontractor bid error, contractor performanceproblems, compensable owner-caused problems,delay, and loss of productivity, as applicable.It is Long International’s standard practice tocommunicate frequently and clearly regardingthe status of our work throughout theanalysis process.

For each phase of arbitration or litigation, experttestimony may be required. Our work to performthis testimony includes the following:

1. Prepare for Testimony

2. Provide Expert Testimony at Depositions

3. Provide Arbitration/LitigationExpert Testimony

Our consultants offer unique perspectives based on a combination of their claims consulting skills,

technical expertise, and “mud-on-the-boots” practical experience in pipeline projects.

��Detailed Analysis

��Report Preparation

��Arbitration/Litigation Testimony

LONG INTERNATIONAL


Schedule Delay Analyses

The contemporaneous and retrospective scheduledelay analyses performed by Long Internationaltypically focus on comparing as-planned, updated,and as-built project schedules to identify andquantify delays to the critical and near criticalpaths of the project. These delays may includeeither variances in the duration of an activity orvariances in the planned and actual relationshiplag durations between predecessor and successoractivities. Concurrent delays are also analyzed toproperly understand the Owner’s and Contractor’sliability for delay and impact damages. On Pipelineprojects, a progress chart is often plotted on atime scale to demonstrate the impact of lowerthan planned progress on the completion date,such as shown in the graphic above.

Loss of Productivity Analyses

To determine the Contractor’s entitlement toconstruction labor productivity loss claims, adetailed assessment of contemporaneous man-hours, crew progress, and pipeline length installed,the timing of changes, delays and impactingevents affecting the work, and an allocation ofresponsibility for the various causes of delay

and disruption is often necessary. Delays andimpacting events often cause the Contractor towork overtime, perform work out of its plannedsequence or in parallel rather than in series, workin weather conditions that are less favorable thanit reasonably planned, employ multiple shifts,etc., all in an effort to make up time to mitigatedelay and disruption. Then, loss of productivityanalyses can be performed using methods suchas measured mile, earned value, overtime studies,other industry studies, and the impact of changes.

Damage Analyses

Long International employs numerous methodsto analyze, demonstrate or disprove the Contractor’sentitlement to recovery of increased costs as aresult of engineering and/or construction laborproductivity loss caused by delays and impactingevents for which the Owner and/or the Contractormay be responsible. After the Contractor’s varioustypes of damages are identified, evaluated forentitlement, and quantified, Long Internationalmay utilize various methods of presenting suchdamages, depending on the contract terms, legalissues, and availability of data and documentation.

Experience Matters ...

12JUL

PlannedStart

27JUL

PlannedFinish

30AUG

ActualFinish

LONG INTERNATIONAL

CUMULATIVE PIPELINE PROGRESSActual vs. Should-Have Been

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General Pipeline Construction Company – Midwestern Oil Pipeline

2 0 1 0July August

July August

I M P A C T

I M P A C T

No per Day

40 44 42 45 43 42 44 41 36 30 24 24 72 76 78 75 71 77 77 74 78 81 80 83 81 79 82 80 81 83 80 82 82 85 95 106 154 176 238 244 240 238 244 149 132 134 128 120 96 42

7/1/10 7/2/10 7/3/10 7/4/10 7/5/10 7/6/10 7/7/10 7/8/10 7/9/10 7/10/10 7/11/10 7/12/10 7/13/10 7/14/10 7/15/10 7/16/10 7/17/10 7/18/10 7/19/10 7/20/10 7/21/10 7/22/10 7/23/10 7/24/10 7/25/10 7/26/10 7/27/10 7/28/10 7/29/10 7/30/10 7/31/10 8/1/10 8/2/10 8/3/10 8/4/10 8/5/10 8/6/10 8/7/10 8/8/10 8/9/10 8/10/10 8/11/10 8/12/10 8/13/10 8/14/10 8/15/10 8/16/10 8/17/10 8/18/10 8/19/10 8/20/10 8/21/10 8/22/10 8/23/10 8/24/10 8/25/10 8/26/10 8/27/10 8/28/10 8/29/10 8/30/10 8/31/10

0

00

000

000

000

000

90,000

70,000

0

10,000

20,000

30,000

40,000

50,000

60,000

80,000

100,000

Should-Have Finished Date of 12Aug10But-For Reduced Crews Due to Lack ofOwner Inspection Crews

I M P A C T

I M P A C T

C O M P E N S A B L E D E L AY18 CDs

Actual PipelineInstallation

OWNER FAILURE TOPROVIDE SUFFICIENTINSPECTION PERSONNEL

CONTRACTOR FAILURETO MOBILIZE SUFFICIENTCRAFT MANPOWER

I M P A C T

I M P A C T

CONTRACTORPREMATUREDEMOBILIZATION OFCRAFT MANPOWER

40 44 42 45 43 42 44 41 3630 24 24 72 76 78 75 71 77 77 74 78 81 80 83 81 79 82 80 81 83 80 82 82 85 95 106

154 176

238 244 240 238 244

149 132 134 128 12096

42

Number ofCraft Laborper Day

Should-Have Been PipelineInstallation But-For ReducedCrews Due to Lack of OwnerInspection Crews

I M P A C TI M P A C T

16 CDsN O N C O M P E N S A B L E D E L AY

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 310

50100150200250300

www.long-intl.com5265 Skytrail Drive Littleton, Colorado 80123-1566 USA Telephone: (303) 972-2443 Fax: (303) 200-7180••• •Long International, Inc. •