Broader Requirements for Resource and Energy Projects?
In a previous post, I voiced an opinion that more development projects should proceed with a view that their external stakeholders, and in particular those locally situated near proposed developments who may experience a direct impact from the development, should be treated as clients. That their objections, requests, concerns and suggestions for the project be treated with the same level of emphasis as those of the client who is sponsoring the project. That the risks associated with their concerns be acknowledged and addressed. That is, that these points be formulated into requirements that can be delivered,
within the scope of the project.
I’d like to speak for a moment about why this is a distinct issue that applies mainly to the natural resources and energy sectors, and possibly also to large-scale linear and municipal infrastructure where numerous community stakeholders could have an impact on the outcomes of environmental assessment approvals.
Standard Practice and Guidance
In project management guidance materials and related blogs, there is focus on identification of all of the necessary requirements for a project, often with two particular categories highlighted - those being product or solution requirements, and project requirements, to ensure the best potential for successful delivery. Several studies within the project management realm have indicated that the rates of cost overruns, schedule delays, and project failures are associated with poor identification of requirements. In improving this practice, these failure rates should diminish, and client satisfaction should improve. I agree that this should be the case.
PMI recently did release a new practice guidance document, Requirements Management, which indicates a few more types to consider: business, stakeholder, transition, quality and program, but they indicate that the quality, program and project requirements are not directly part of the requirements process - rather they suggest they are part of the project or program.
But I would also argue there remains a critical gap in requirements delineation for projects where there is an additional introduction of potential long-lived disturbances and/or risks to either people or the environment, or both, as a result of the project objectives, and where a company’s ongoing social license to operate becomes a factor.
A Gap for the Resources Sectors
Let us think for a moment about the consideration of further categories of requirements, with less of a focus around the actual delivery of the desired product, but more so on other elements associated with, or that are generated as byproducts from, the delivery of said product.
The first additional category would specifically address requirements associated with gaining internal and external approvals for the proposed development. We might call them “approvals requirements”, and although these might be partially captured within the category of stakeholder and/or quality requirements mentioned in PMI's guidance, I feel they should remain as distinct elements, as they relate directly to the periphery of the product delivery, and could easily be (and often unfortunately are), kept separate from the project scope.
The second additional category ties in with the last, in that it could also impact gaining approvals from some stakeholders, but is in itself, an area that deserves some undivided attention as well. This category is to address the requirements of the project that would ultimately facilitate the closure of a site, or for the property to achieve its end-land use objectives, all the while leaving no legacy impacts to the land and surrounding area, or leave a high potential for impacts to occur in the future. We could call these “closure requirements”.
Most of these sets of requirements will complement the design such that there is a form of risk avoidance mechanism applied – or a process might be altered to address the risk while still enabling achievement of the delivery and quality of the desired product. Some of them may simply require additional design elements.
Others may be fuzzier in nature and may need to be dealt with either through adaptation of design OR through development of operational methods and associated training to address the associated issues. They may impact what types of strategies are investigated at a holistic level, or for particular functions (i.e. in trade-off studies), or may impact decisions that are made on the selection of options, the siting of various infrastructures, or even applying a concept of staged development and operations, outside of the selection of the technologies to deliver the functional requirements.
All of these requirements will impact the overall project requirements, in that the cost, schedule and customer satisfaction could well be impacted if they are not integrated into the project scope from the start.
The Associated Risks
What is mainly at risk by not clearly defining these requirements at the start, is that during a multi-year project evaluation and design period for such developments, there are multiple elements that need to come together for the whole, multiple design teams and consultants, internal and external stakeholder management and communications groups, and environmental assessment practitioners.
It can be very easy for project managers and designers to focus in solely on what is required to deliver the components necessary for producing the valued ore, energy infrastructure, utilidor or highway, or whatever said project might be for. This is particularly the case where value stream mapping delineates the most streamlined, minimum viable strategy for delivery of a product. While I appreciate the benefits of value stream mapping, and would actually encourage its application to streamline and make designed processes more efficient, it could result in some necessities being stripped from the system, if the requirements are not well defined.
When clear requirements are not established to ensure the long-term, operational and post-operational safety and integrity of the site where this product is being delivered, the easiest, lowest cost option tends to skim over, or at best, meet the very minimum standards for some of these requirements. To do more becomes an afterthought, has to be introduced during the environmental assessment phase (often creating re-work), or if somehow approved, it is pushed out in time for an operational site to deal with later.
And where suggested requirements have been considered, but not well documented or well integrated as part of the project scope, this can lead to problems too. Sometimes, the measures that were put in place to address the associated risks can also be the first areas where misinformed personnel might apply cost-cutting measures, through value engineering exercises in final design stages, or even later during construction when cost overruns are most typical.
And these issues become increasingly apparent when there is a large turnover of personnel, or shifts from one consultant to another as the project moves through the various lifecycle phases (i.e., feasibility to detailed design to construction, etc.) It is the primary reason why industrial operations pose high potential for environmental impacts, and why existing facilities are now continuously investigating methods how to improve their performance rates – a historical lack of integrated strategies to prevent impacts, rather than address them if, or when, they occur.
Some Opportunities
For such large scale projects, and typically long-lived projects (or at least long-lived disturbances post-operations), designing to the minimum standards of the day will not typically ‘fly’ with external stakeholders, who will continue to live with the results of a project over the longer term. Such projects would also likely face future work to ‘bring them up to code’, as changes are often made to regulations over time. This can significantly impact the bottom line for investors of said developments – the value, or return on investment, diminishes as time passes.
It is best to look ahead at areas where best practices or best available technologies are performing well, and also, to consider where a lot of research efforts are on the environment front, to identify specifically which aspects of regulations have a high potential for change, and address those upfront in early evaluation phases. This will inform the designers of things that may impact future environmental performance, which could potentially be addressed through altered designs or processes.
We need also to think of, and design for, more natural looking landforms, where the landscape will have been altered during a development’s lifecycle. Mimicking natural landforms within the region of the development will not only make it blend back into nature at the end, but it should also yield a structure having more long-term stability. After all, the regional climate plays a strong role in the formation of those existing landforms – if that is how nature made them and they are ‘still standing’, then it is most likely that man-made landforms of similar shape should stand a better chance of surviving too.
A Compelling Example
I recently spoke about at a local mineral processing conference, where I provided a distinct example of long-term considerations for the mining sector. This was the thought that rather than only focusing on how to extract x amount of ore, at y grade and z throughput, process designers need also to focus on the volume, density, placement, and chemical stability of the tailings that are produced as a result of said extraction.
Too often, we are hearing about the structural failure of tailings containment facilities, for any number of reasons, but many having to do with holding too much water. Aside from the environmental damage, significant impacts from such failures are devastating and long-lived – deaths, people out of homes, jobs, schools and other necessities of life, contaminated water resources, and economic impacts to the local communities (particularly where they are concentrated on a natural resource such as fisheries, hunting, ranching or farming in the downstream vicinity of such failures). The owner’s reputation can take a pretty big hit, too, let alone its pocketbooks.
So why utilize only one strategy of managing high-potential risks associated with tailings – why rely solely on the design and existence of a containment dam, to last in perpetuity, when so many conditions of a site can change over time? And when the landform of a dam structure is so un-natural in most regional settings?
I’ve seen plenty of designs for primary and secondary spill collection, dual containment or pipe-in-pipe for transport of contaminated fluids, leak detection systems underlying operational containment systems – these are all typically shorter term risk management requirements, and are no longer needed post closure. We also usually have more than one line of defense when it comes to personnel safety on the job. You would think that this particular risk would hold more weight for an organization.
Parting Thoughts
So how do you ‘back up’ the integrity of a dam, particularly an earth-fill or tailings dam? By dealing with, or manufacturing the materials behind it – make them safer, more stable, and less likely to cause an impact should the inevitable occur.
It is exactly these types of requirements that can and should be included in the additional categories I’ve mentioned – with this one being specifically a closure requirement, but also tying to approvals requirements. They are absolutely critical for the long-term success of mining developments, a company’s social license to operate, and the protection of the environment over the long term.
There is currently a shift occurring in tailings management and mine dam design recommendations, in that we need to be addressing the stability of tailings themselves, rather than simply the dams that hold them in place. I encourage people to stay informed about where these guidelines are headed, but in the mean time, think more broadly to what else you can do within the sandbox you play in…
What other high-potential risks could you make a dent in managing through your own work, design, or operational strategy?
What other stakeholder concerns could you address simply by adjusting your ‘standard’ design philosophy?
What ‘approvals’ and ‘closure’ requirements should you be including within your project scope?
Please leave some comments below, or better yet, post another question or opposing opinion to generate some discussion on this topic! I’d love to hear some of your thoughts!