With land surveys, contractors often expect some information will be missing. But how much? Fifteen years ago, El Paso Corp. decided to replace a 68-mile-long pipeline with a new one that would carry butane from Corpus Christi, Texas, to inland Air Force bases. The energy company hired a Houston-based survey mapping firm to draw the route with rivers, roads and crossing rights of way. In all, the mapping company counted 280 survey crossings included in the bid package. No one pretended the count was final, and El Paso encouraged potential bidders to do their own survey.
Coral Gables, Fla.-based MasTec, at that time a newcomer to pipeline projects, hired an industry veteran who conducted a flyover of the route, but much was missed, court documents show. MasTec submitted a bid of $3.69 million, well below the average bid of $8.1 million. It signed a contract in 2003 where it took the risk for overruns.