CIPAA 2012, SECTION 4

Oil and gas work
is construction work.

Section 4 of CIPAA 2012 defines construction work to include gas, oil and petrochemical work, along with pipeline work. The courts have read it broadly: in MIR Valve Sdn Bhd v TH Heavy Engineering Bhd the High Court held that converting a ship into an FPSO was construction work under the Act. For a Malaysian contractor doing plant, terminal or turnaround work, this means the statutory payment clocks run on your claims, the same claim discipline applies, and the record you keep is the record that decides an adjudication.

THE SCOPES WE ARE BUILT FOR

Same trades. Harder client.

These are the trades already on our industries list, working in plant instead of on a building site. The work is familiar. What changes is how hard the claim gets read.

ScopeYour tradeWhere the claim gets argued
Shutdown and turnaroundMulti-trade, M&E ledEmergent scope inside a fixed window. Half the work was not in the original order, and every hour of it is a variation somebody has to price later
Plant E&I installationElectrical, instrumentationCable pulled and terminated against loop checks actually witnessed, not against metres claimed
Tank farm and terminal worksMechanical, steel fabricationFabrication progress, erection and testing claimed as one line when they complete months apart
Pipeline worksCivil, weldingWeld counts and NDT acceptance against metres billed
Fire protection to plantFire protection, BOMBA scopeInstallation complete against commissioning signed off, which are not the same date and rarely the same month
THE TURNAROUND PROBLEM

The scope grows while the clock runs.

A three-week shutdown finds corrosion nobody scoped, valves that will not free, and tests that fail on the second attempt. Your crew does the work, because the plant has to restart on the date the plant has to restart. Nobody stops to paper it properly.

Then the argument happens four months later, against whatever anyone happened to write down at the time. That is not a scheduling problem. It is a variation problem wearing a schedule costume, and it is decided entirely by the quality of the record somebody kept at two in the morning.

An approved variation folds into the line it revises. An unapproved one cannot be claimed at all. Both carry the date they were raised and the person who raised them, whether or not anyone was thinking about the final account that night.

THE STRAIGHT VERSION

Where we are the wrong call.

Offshore and upstream EPCIC work. That sits behind vendor prequalification, HSE regimes and procurement cycles a two-person firm has no business claiming to satisfy, and the operators there run enterprise systems for reasons that are good ones.

Moorstack holds no PETRONAS licence and no conformance to PETRONAS Technical Standards, and has no oil and gas client to point you at. If vendor licensing is what you need, that is a real requirement and we do not meet it. We would rather lose the enquiry here than three meetings from now.

What is left is the work we are actually built for: onshore plant, terminals, tank farms and turnarounds, run by CIDB-registered contractors whose money problem is the same one every other Malaysian contractor has. See how the payment clocks run, and what a provable receivables position looks like.

COMMON QUESTIONS

Asked plainly.

Does CIPAA actually apply to oil and gas work?

Section 4 of Act 746 defines construction work to include gas, oil and petrochemical work as well as pipeline work, so contracts for that work fall within the Act on the face of the definition. The courts have applied it broadly: in MIR Valve Sdn Bhd v TH Heavy Engineering Bhd [2018] 7 MLJ 796 the High Court held that conversion of a ship into a floating production, storage and offloading vessel was construction work under CIPAA, a position affirmed in E.A Technique (M) Bhd v Malaysia Marine and Heavy Engineering. Whether it applies to your specific contract still depends on that contract and where the work is carried out, which is a question for your own adviser and not something software should answer for you.

We work under PETRONAS or bespoke contract forms, not JKR or PAM. Does the platform still fit?

Yes, because the claim engine is built on the contract you signed rather than on a named form. It works from priced lines, quantities, the rate in force when a line was claimed, retention on your terms, and variations that revise the line they relate to. JKR and PAM are output formats we already carry; your own form is configured during the build. The ledger underneath is the same either way.

Are you PETRONAS licensed, and do you have oil and gas clients?

No to both, and you should discount anyone in this market who answers otherwise without naming the client. Moorstack holds no PETRONAS licence and no PETRONAS Technical Standards conformance, and has no oil and gas reference case. What it has is a claims, variation and payment engine built for Malaysian statutory workflow, and CIPAA covers your work as clearly as it covers a building contractor's. If licensing or technical-standards conformance is what you need from a vendor, we are not it.

What about offshore work?

That is where we stop. Offshore and upstream EPCIC work sits behind vendor prequalification, HSE regimes and procurement cycles that a two-person firm has no business claiming to satisfy, and the operators in that space run enterprise systems for good reasons. There is also a live question about how far the Act reaches for work carried out outside Malaysian territory, which is a matter for your legal adviser. Onshore plant, terminals, tank farms and turnaround work executed by CIDB-registered contractors is the work we are built for.

Why is a turnaround different from ordinary contract work?

Because the scope grows while the clock runs and nobody stops to paper it. A three-week shutdown discovers corrosion, seized valves and failed tests that were never in the order, the crew does the work because the plant has to restart, and the argument about what it was worth happens months later against whatever anyone wrote down at the time. That is a variation problem wearing a schedule costume. An approved variation folds into the line it revises, an unapproved one cannot be claimed, and both stay on the record with the date they were raised.

Does this replace our maintenance system?

No. If you run SAP PM, Maximo or another CMMS, keep it. That governs assets and work orders. Moorstack governs what you are contractually entitled to be paid for the work those orders produced, and whether you can prove it. The two answer different questions and are commonly run side by side.

Statutory scope: Construction Industry Payment and Adjudication Act 2012 (Act 746), section 4. Case references: MIR Valve Sdn Bhd v TH Heavy Engineering Bhd [2018] 7 MLJ 796, and E.A Technique (M) Bhd v Malaysia Marine and Heavy Engineering Sdn Bhd. General information about the statute, not legal advice on your contract. Whether the Act reaches a particular contract depends on that contract and on where the work is carried out.

ON YOUR OWN TURNAROUND

Bring the shutdown you argued about.

Thirty minutes with both founders. Bring one turnaround where the variations were still being argued after restart, and we will walk it through the ledger so you can see what the record would have held.

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