Cost-Escalation Clause

The point when project financing is fully secured and contractual obligations become binding. For subcontractors, it typically signals that mobilisation, procurement, and invoicing can officially begin. Work started before financial close carries significant payment risk.

A standardised daily report documenting rig operations, hours worked, and downtime on a drilling project. Subcontractors often must align their own daily reports with the IADC DDR for invoicing and performance verification. Discrepancies between your records and the DDR can delay payment or trigger billing disputes.

An unplanned increase in project costs due to rising material prices, labour rates, or scope changes. Subcontractors without escalation clauses in their contracts absorb these overruns directly. Always negotiate cost escalation provisions before signing fixed-price agreements.

A breakdown of costs on a field ticket or invoice, separating charges into labor hours, equipment usage, and materials consumed.

A formal change to an existing contract's scope, timeline, or pricing. Subcontractors must document alterations in writing to protect payment entitlements. Verbal agreements alone rarely hold up during disputes or audits.

When an operator returns a field ticket for correction before approval. Common causes include missing information, rate discrepancies, or insufficient documentation. Rejections delay payment and require rework.

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