Tiny Varanus Island, off the Pilbara coast, was the centre of a record breaking construction effort which launched a group of small oil and gas fields south of what is now the giant Gorgon project.

Alan Bond, who died last year, led his consortium in a drive to quickly gain urgently needed cash flow from the Harriet oilfield.

He gave the contract to a partnership of Bechtel and Clough Engineering, on the condition they built a production platform and linked it to Varanus within 12 months.

They completed it on January 18, 1986 with only days to spare.

Oil flowed to Varanus Island that day, setting a new record for such an assignment.

The partners had earlier discussions with the previous owners of the oilfield, Occidental Oil, but these ended when the field was sold to Bond Petroleum.

The new owners injected a sense of urgency into the negotiations - the Bond Group urgently needed a strong cash flow, coping with one of the many crises the group faced over the years.

Bond encouraged the contractors, still recovering from their surprise when told of the deadline, to adopt unconventional methods to meet the target date for commissioning.

The engineers devised a rarely employed contract which would probably have been accepted only by a bold group like Bond.

Under Lump Sum Contracting, as the agreement was called, designing and ordering critical components would begin immediately, with some of this still going on after construction began.

Using as a guide a broad, generalised budget prepared by Bechtel, work began immediately, with the joint venturers paid a fixed lump sum for engineering and more precise figures produced for components of the project throughout its life.

However this component was not completed until the venture was partly completed.

The engineers broke the project into a number of packages and would then submit an "open book price" on each package progressively.

Bond then had three options, to accept this first offer, at which point work would begin on the lump sum contract for that portion of the work.

It could also proceed on a reimbursable basis, that is pay on a cost plus system as the work proceeded.

Finally Bond could, with each package, choose an "off ramp" method, that is they could seek bids throughout the industry for that part of the work, in a conventional tendering practice.

In the event Bond accepted the up front lump sum offers on all the segments of the project except one, related to offshore installation work, where the joint venturers had built in costings for time which might be lost due to bad weather.

Bond decided not to accept a lump sum price for this work but instead reimbursed the contractors for the work as it proceeded.

It proved to be a sensible decision because no time was lost because of bad weather so some money was saved.

Bond Petroleum had to have considerable trust in the engineers, not only to complete the contract quickly and efficiently but not to exploit the open ended nature of the budgeting.

It was not until January 1985 that the joint venturers were established in Perth, and by the end of that month the first major orders for the purchase of equipment were issued.

Detailed design and drafting of the jacket and deck structure went on in February and more major items of equipment were ordered.

The lump sum estimate for fabrication and assembly of the jacket and deck structure was completed by the end of February, one of those packages of work mentioned earlier.

By July the platform jacket was half completed, and by October it was ready to be towed to the Harriet site.

Its installation was carried out in November and in December the pipelines to the island were linked to the platform.

On January 18 oil flowed to the onshore terminal, a truly astonishing feat of engineering.

Ironically the Bond organisation sold the Harriet Oil Field soon after, but an examination of the economics of such a venture indicate why the company regarded the completion of the field with such urgency.

At oil prices prevailing at the time the ultimate flow of 10,000 barrels of oil a day (it was initially planned on the assumption of 8000bbl) it would have given the beleaguered company a cash flow of between $1.5 million and $2 million a week, or up to $100 million a year - about double in today's values.

Given the cost of the development, $80 million, the payback period was attractive, and indeed the field has proved to be an excellent investment.

An engineer who worked on the venture recalls that that the speed with which the project was completed and the quality of the work done, reflected the happy meeting of a number of factors - the unconventional and dynamic nature of the Bond organisation at its best, its acceptance of the innovative contracting system, and also the great skills of Bechtel and Clough.

Bechtel had an almost unrivalled knowledge of the oil and gas industry, Clough brought to the joint venture its immense experience in working in Western Australia.