Project Management Institute

Sea Change

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2013 PMI PROJECT OF THE YEAR AWARD WINNER

In the throes of a drought, the SA Water team convinced skeptical stakeholders of the need for a desalination project—but then it rained.
BY TEGAN JONES

2013 PMI PROJECT OF THE YEAR AWARD WINNER

The project launched after seven years of record-low rainfall had left the River Murray, southeastern Australia's primary source of water, an anemic shadow of its former self. The drought had a dire effect on the city of Adelaide, which sits at the mouth of the River Murray. As riverbeds and reservoirs began to dry up, the government of South Australia searched for a steady source of water that would protect the population in a changing climate.

The Adelaide Desalination Plant was its solution. The project team just had to convince a highly skeptical public that not only was the project needed but its scope should be doubled. That would take some stellar stakeholder management.

SHORING UP SUPPORT

Launched in February 2008 with a budget of roughly AU$1.4 billion, the 50-gigaliter (13-billion-gallon) facility would provide up to 25 percent of the community's drinking water after construction was completed in June 2012. Despite the water security it promised, many public and private stakeholders were hesitant to support an investment of that size amid a global economic downturn.

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From left: Milind Kumar, Roger Perry and Karlene Maywald

“It was important that the project team, from day one, understood what this project was about. This project underpinned the economic development of this state.”

—Roger Perry, South Australian Water Corp.

“We were in a
situation where
no government
would ever
want to be.”

—Karlene Maywald,
National Water Commission

“In the last few years, Australia, like everywhere else in the world, has been under tremendous economic pressure. Confidence was low. Money was drying up. So we had to be very careful,” says Roger Perry, former head of strategy, planning and regulation for South Australian Water Corp., a government agency that provides water and wastewater services to the region.

Still, the state's government understood what was at stake. If water restrictions continued to increase, businesses would have no choice but to seek greener pastures. That would spur a string of job losses, which could throw the entire economy into a tailspin.

“It was important that the project team, from day one, understood what this project was about,” Mr. Perry says. “This project underpinned the economic development of this state.”

As the drought deepened and water restrictions tightened, public stakeholders began to see the need for the project. Gardens browned, pools emptied and even the city's recreational areas were closed to public use. At one point, public reservoirs held only one day's worth of water—and the government had trucks full of emergency bottled-water supplies ready to go.

“We were in a situation where no government would ever want to be,” says Karlene Maywald, former minister for water security for South Australia and current chair and commissioner of the National Water Commission.

Looking to secure a water supply for its 1.7 million people, the state rallied support to build the plant and, in June 2009, to double the plant's planned capacity.

The completed Adelaide Desalination Plant

The completed Adelaide Desalination Plant

Doubling the size of the plant called for nearly 40 of the plant's 70 large pumps to come online 12 months ahead of schedule, and 70 more large pumps to be constructed within the original timeline of June 2012.

The expanded scope would make the facility the largest infrastructure project ever constructed in South Australia and provide up to 50 percent of the region's water at any given time.

SETTING THE COURSE

With a budget increase of AU$450 million, the project team was able to bring on additional resources—but it first had to find people with the right skills.

“You have to know people who understand risk, who understand how to plan, how to communicate and how to solve problems,” says Mr. Perry. “You needed high-quality people who had done large projects, had done complex projects and understood what all that meant.”

Bringing in the right people, clearly outlining their roles and communicating how issues should be escalated ensured that the team stayed true to its mission as it grew.

“The aim was to bring total alignment about our objectives, making sure that we brought in the right leaders to the team and built the team on the core values of the project,” says Milind Kumar, project and operations director of SA Water.

As project leaders built their team, they reviewed the successes and shortfalls of other facilities, and worked with internal and external experts to flag risk factors that could push the project off track.

Many of those risks revolved around a powerful stakeholder group: the government leaders who would provide the necessary approvals. With so much on the line, Ms. Maywald helped build buy-in—and keep things moving—by forming a project steering committee made up of representatives from the relevant government agencies.

“We wanted to make sure we had a process in place where we could make decisions quickly, but thoroughly. We did not want to cut corners because this was an investment in the future of the state,” Ms. Maywald says.

Getting senior decision-makers in a room together helped the team hash out issues quickly and prevent logjams.

Sea tunneling in Gulf St. Vincent

Sea tunneling in Gulf St. Vincent

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Water Line

▪ February 2008: The South Australian government announces a proposal to build a 50-gigaliter (13-billion-gallon) desalination facility.

▪ November 2008: The government approves the AU$1.4 billion project budget for the plant.

▪ February 2009: Land for the facility is acquired from ExxonMobil.

▪ April 2009: Construction begins.

▪ June 2009: The government decides to double the capacity of the desalination plant.

▪ April 2010: Treated water system completed.

▪ Mid-2010: The drought ends. Public criticism of the project rises.

▪ September 2010: Tunneling works completed.

▪ June 2011: The first flood of seawater is pumped into the plant.

▪ October 2011: Desalinated water is introduced into Adelaide's water supply.

▪ May 2012: The first half of the facility reaches full capacity.

▪ June 2012: Both plants complete construction within the original timeline of the 50-gigaliter plant.

▪ September 2012: Both plants reach full capacity.

▪ December 2012: The project is handed over to the facility operator.

Intake and outfall tunnel portals

Intake and outfall tunnel portals

“This project is a classic case where you need good project management because there are a large amount of public funds involved, there are a large number of stakeholders, and there is a complex series of interdependent variables.”

—Milind Kumar, SA Water

A safety inspection of the plant

A safety inspection of the plant

“The project steering committee created a platform for government collaboration on fairly significant issues and also created a timeline for the resolution of these issues,” Mr. Kumar says.

THE TIDE TURNS

Then, in mid-2010, the rain fell, and the project was drowning in controversy.

“As soon as the drought broke, some of the media took a very strong view that probably we shouldn't have doubled the capacity in the manner in which we did,” Mr. Kumar says.

To communicate why the project was still a smart investment for the state, the team relied on an extensive stakeholder communications plan. It held public meetings, distributed fact sheets, built an informational website and met with local business groups.

Beyond simply pushing out marketing materials, the team continued to bring community stakeholders into project discussions. By actively seeking out critics and listening to their concerns throughout the project, the team identified new opportunities—and risks.

To alleviate concerns the project would damage the local marine ecosystem, for example, the team engaged an independent panel of scientists. Through a series of tests and observations, it confirmed the planned release volume of brine would be safe for marine life.

“Through our environmental assessments process, the community understood that we were looking after the environment,” Mr. Perry says. “So now they had the solution, plus the satisfaction that it wasn't going to destroy the world.”

The project team also looked for input from the local aboriginal community, the Kaurna people. The group has complained about public projects destroying important artifacts and sites, so from the outset, the SA Water team looked for a way to protect their heritage.

“We engaged with the aboriginal elders, and throughout that engagement process we identified opportunities where they could have input into the project,” Mr. Kumar says.

One suggestion was to survey the land for artifacts and sites of significance.

The team then showcased the found pieces in the public interpretive center on the site. The Kauwi Interpretive Center, named after the Kaurna word for water, helped the project connect with the public by communicating SA Water's concerns for the local community and the surrounding environment.

“It has been the first government agency that has actually delivered an interpretive center,” says Lynette Crocker, a Kaurna elder and former member of the Kaurna Heritage Board in Adelaide. “We've asked for that for years and years, but they're the first ones that delivered.”

“This project is a classic case where you need good project management because there are a large amount of public funds involved, there are a large number of stakeholders, and there is a complex series of interdependent variables.”

COMING ASHORE

With all eyes on the project, the team had to make sure the relationships it built and the promises it made were backed up by results.

“This project is a classic case where you need good project management because there are a large amount of public funds involved, there are a large number of stakeholders, and there is a complex series of interdependent variables,” Mr. Kumar says.

To manage the rapidly growing team and tightly compressed timeline, the team kept an eye out for potential bottlenecks. Having several teams of contractors working on the site at once required operating without a lay-down area where building materials could be stored. To avoid slowdowns, the team created a detailed plan outlining what tasks needed to be completed when, so the contractors could plan their loads accordingly.

“We actually had to bring in an extra afternoon shift and a night shift to do things. So we divided work into bite-sized chunks that we could easily monitor, manage and then deliver reliably,” Mr. Kumar says.

To avoid cost overruns, the team organized these scope packages into sub-projects led by assigned project managers who held responsibility for the budget. The team then monitored costs on a weekly and monthly basis throughout the project life cycle.

“Because this plant has been successfully completed and operational when the next drought hits, people will just turn their taps on, and the water will still come out and people won't know it exists.”

—Roger Perry

“We made sure we monitored the physical progress of work orders against what was happening in terms of cash flow,” Mr. Kumar says. “And as soon as we reached a point where the work was completed and cash flows reconciled, we closed those work orders.”

With these processes in place, the project closed 19 days early and within 1 percent of the approved budget of AU$1.8 billion. Independent reviews by consultants

KPMG identified it as the most capital-efficient desalination plant in Australia, with the lowest operating cost per megaliter of drinking water produced. But the project's biggest accomplishments will most likely go unnoticed, Mr. Perry says.

“Because this plant has been successfully completed and operational when the next drought hits, people will just turn their taps on, and the water will still come out and people won't know it exists.” PM

The team gathers to celebrate the project's completion

The team gathers to celebrate the project's completion.

This material has been reproduced with the permission of the copyright owner. Unauthorized reproduction of this material is strictly prohibited. For permission to reproduce this material, please contact PMI.

PM NETWORK NOVEMBER 2013 WWW.PMI.ORG

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