EPC (Engineering, Procurement, Construction) is a turnkey, fixed-price contract — the contractor bears construction risk and delivers a working plant. EPCM (Engineering, Procurement, Construction Management) is a cost-reimbursable contract — the contractor manages on the owner's behalf but the owner holds the construction contracts. Most mining EPCM is preferred because it gives the owner cost transparency and the flexibility to substitute scope.
EPC — Fixed Price
The contractor wraps engineering, procurement, and construction into a single fixed-price (or fixed-price-plus-incentive) contract. The contractor takes on most of the cost and schedule risk. Suitable when scope can be tightly defined upfront and the owner wants budget certainty above all else. Common in oil and gas; less common in mining.
EPCM — Cost-Reimbursable
The contractor delivers engineering and procurement at cost-plus or fixed-fee, and manages construction at cost-plus while the owner holds the construction subcontracts directly. The owner sees every invoice and approves every change. Risk and reward are largely on the owner's side.
Why Mining Favors EPCM
Mining projects are at remote sites, with country-specific labor and customs realities, with ore-related scope changes during execution. Owners want flexibility to substitute equipment, change scope, and source labor locally — EPCM allows that. EPC contractors price in significant contingency that owners often prefer to manage themselves.
KCA's Mode
KCA has delivered 17 EPCM contracts including the $125M Camino Rojo for ORLA, the $134M Pinos Altos for Agnico-Eagle, and the $104M Ocampo for Gammon. See Engineering & EPCM for full scope and references.
Have a project that involves EPCM vs EPC?
KCA’s engineering bench and Reno metallurgical laboratory have done this before. Let’s talk about your project.
Send an Inquiry