Analyzing the Impact of Contract Amendments on Climate Resilient Large Water Supply Project in Nepal

Abstract

Water supply infrastructure plays a critical role in national development, public health, and climate adaptation of Nepal. Climate resilient water supply projects, specially launched in complex ecological and socio political contexts, demand robust contract management to achieve timely, cost-effective, and high quality results. However, frequent contract amendments particularly Extensions of Time (EoTs) and Variation Orders (VOs) often undermine project outcomes. Despite their significance, some empirical evidence exists on their causes and mitigation in Nepal’s water sector.

This study explore the nature, frequency, and determinants of contract amendments across 54 water supply projects managed by the Project Management Office (PMO) under the Climate Resilient Water Supply Project (CRWSP) of Nepal. A mixed methods approach was adopted, using secondary data from project documents, amendment logs, and Bills of Quantities (BoQs), along with primary data from Key Informant Interviews (KIIs) with experienced project managers and engineers.

Resurch findings indicate that 79.63% of the projects experienced at least one amendment, often involving both EoTs and VOs. EoTs were primarily driven by external factors such as pandemics like COVID, extreme weather, political disruptions, and material or labor shortages. VOs resulted largely from design flaults, additional work needs, administrative inefficiencies, and inaccurate BoQs. These issues reflects systemic shortcomings in planning, risk assessment, and stakeholder coordination.

To address these challenges, the study proposes some important strategies including rigorous design reviews, BoQ validation, digital contract management systems, risk registers, and synchronized project scheduling for the mitigation. The findings offer actionable insights for strengthening contract governance and improving delivery of water infrastructure in Nepal.