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| SAFE Fixed sites are more secure than transmission lines. |
The costs for contractors working in a war zone have become shockingly apparent in recent months as insurgents have made targets of civilians reconstructing Iraq and Afghanistan. While acknowledging the human costs, contractors are cautiously continuing to execute their contractual obligations and to pursue new contracts there. The financial risks are manageable, most say.
At least 10 employees of prime contractors or subcontractors have died in Iraq and Afghanistan this year, according to published reports. In addition, three have been injured and an engineer kidnapped. He was later released (ENR 12/8 p. 15).
Security is paramount in a war zone. "Security is not normally a factor on a run-of-the-mill international contract," says Robert Band, president of Perini Corp., Framingham, Mass. Perini has a $66-million task order under a $500-million indefinite-delivery/indefinite-quantity contract with the Corps of Engineers for electrical-system reconstruction in southern Iraq. "It might be thought of as a nominal cost."
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But in war zones, people working in the field require close-protection teams. "In-transit security takes on a new role as well," says Band. A single driver with a load is the norm for standard jobs but in Iraq trucks require close-protection teams and an armed guard in the cab, literally "riding shotgun." The owner recognizes the necessity for such costs and Perini builds them into cost estimates.
"The cost burden is substantial, according to Bechtel Corp., San Francisco. Security personnel may constitute 25% of the total. Life-support costs are high, with more personnel required, living in multiple bases and using armored vehicles. Bechtel estimates the cost of security at 6 to 8% of the contract cost. Camp costs run from 4 to 6% of the contract."
The danger of war-zone work takes a toll of another kind on project staff, who also work much longer hours than they would on a project elsewhere since there is little to do outside of work. Conceivably, these unreimbursed stresses could show up in the form of high health claims in the future.
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| Summary: Don't Start the Party Yet |
| Forecast: Inflation will match this years gains |
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| Equipment: Chinas path toward productivity |
| Compensation: Lower salary expectations |
 VIEW RELATED DATA
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| Contractor Casulaties in the War Zone |
But The Louis Berger Group Inc., East Orange, N.J., finds security in embracing the local populace. Senior Vice President Fred Berger wont let his employees "adopt a siege-mentality approach." In Afghanistan, "we work with the Afghani Interior Ministry for our security." The message conveyed is "that were there to help them rebuild their country."
Surprisingly, women may be safer working in Iraq than men. Sandra Cointreau, a water treatment and solid waste engineer, recently returned from Iraq after working as a consultant for Research Triangle Institute, Charlotte, N.C. "The women had more freedom of movement than the men," she says. "When I wanted to go out, Id call an Iraqi friend, hire a car, put on an abaya and go out." Male employees, especially fair-haired, drew more attention. They had to arrange for a convoy, with official SUV and shooters, for each movement.
Lack of security for low-flying aircraft complicates shipping and transportation too. Flights from Baghdad International Airport "have fallen off" since a DHL cargo plane was struck after takeoff by a shoulder-fired missile Nov. 22, says Jack Herrmann, spokesman for Washington Group International, Boise. That led WGI to change shipping plans for generators to Iraq. Instead of flying into Baghdad as originally planned, generators will be flown into a neighboring country and trucked in, says Rex Osborne, WGI business development vice president.
On the other hand, he notes, "Most of our guys flying into Baghdad are go-ing commercial air." Royal Jordanian has scheduled service and the Qatari and Kuwaiti airlines are seriously discussing it, he says.
