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Cash Flow Glossary Term

Shut-In

A temporary halt to production or operations at a well or facility, which often results in subcontractors being stood down with little notice, directly impacting billable hours and crew scheduling. Understanding shut-in clauses in your service agreement is critical, as they typically limit or eliminate your ability to claim standby pay or mobilisation costs during the downtime.

Related Terms

Emergency Relief Funding

Cash Flow

Short-term financial assistance available to subcontractors facing sudden revenue loss due to site shutdowns, disasters, or contract cancellations. Funding may come from government programmes, industry associations, or lenders. Eligibility often requires proof of active contracts and demonstrated financial hardship.

Close-Out

Cash Flow

The final phase of a contract where all work is confirmed complete, documentation is submitted, and outstanding invoices are settled. For subcontractors, delays in close-out often mean delayed final payment. Completing punch lists, timesheets, and lien waivers promptly helps accelerate the process.

Commercial Misalignment

Cash Flow

A disconnect between what a subcontractor quoted and what the client expects to pay for. This often surfaces during invoicing when scope, rates, or billing terms were not clearly agreed upon upfront. It can delay payments and strain relationships with prime contractors.

Fuel Escalation Clause

Cash Flow

A contract provision allowing subcontractors to adjust their billing rates when fuel costs rise beyond an agreed threshold. It protects field crews and equipment operators from absorbing unexpected fuel price spikes. Without this clause, subcontractors bear the full risk of fuel cost increases mid-contract.

Price Book

Cash Flow

A document listing agreed-upon rates for various services, equipment, and materials between an operator and contractor. Field tickets are validated against the price book before approval.

Fixed-Rate Contract

Cash Flow

A contract where the subcontractor agrees to complete a defined scope of work for a set price, regardless of actual labour or material costs incurred — meaning cost overruns come directly out of your margin. Common in construction and turnaround work, these contracts reward efficient crews and tight project management but carry significant financial risk if scope creep or site conditions aren't carefully managed upfront.

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