Alternative Contractual Models of Dredging Projects to Avoid Disputes (A Case Study of the Special Port in Kotabaru)

Abstract

There had been four dredging projects done at the Special Port of PT. Indocement Tunggal Prakarsa Tbk. in Kotabaru, two of which ended in disputes. Therefore, it is necessary to analyze the causative factors for disputes and selection of the best contractual model for dredging projects to avoid disputes. The method employed was the Analytic Hierarchy Process (AHP). The analysis results in the most significant criteria to avoid disputes in dredging projects, which are technical and quality aspects (43%) and the most significant sub-criteria, which are the factors of fixed designs as well as complete and accurate drawings (75%). The alternative contractual model chosen is the Lump Sum Fixed Price contract (53%), where the importance value given by experts reaches 49%. In so doing, in order that dredging projects do not end in disputes, the best contractual model is the Lump Sum Fixed Price.. Keywords - Analytic Hierarchy Process, Contract, Disputes, Dredging