Sand storm

PHOTO COURTESY OF DEME GROUP

Land reclamation projects don’t usually make international headlines. But China’s construction of islands in the South China Sea sparked a geopolitical dispute earlier this year after the Association of Southeast Asian Nations criticized the project for threatening other nations’ sovereignty.

Tense as the moment was, land reclamation projects have a long history in Asia. The entire Hong Kong airport is built on reclaimed land, as is 20 percent of Singapore and some Malaysian islands. Border dispute risks are rare. The more common obstacles practitioners face during these costly and lengthy projects are resource limitations, environmental concerns, local resistance and legislative obstacles.

“The mutual understanding and allocation of the operational, environmental, financial and political risks will result in a smooth execution with fewer surprises.”

—Jack HC Kerklaan, Akuna Dredging Solutions, Brisbane, Australia

A land reclamation project requires one thing above all: sand. Reclaiming 1 square kilometer (0.39 square miles) of land takes up to 37.5 million cubic meters (1.3 billion cubic feet) of sand from rivers, lakes or seas—desert sand is ineffective. As a result, some areas experience shortages.

Singapore’s government is the world’s largest sand importer, having expanded its land area 22 percent over the past 50 years and exhausted domestic sand sources decades ago. Worried about environmental damage, running out of the resource or protecting sea access rights, Cambodia, Indonesia, Malaysia and Vietnam have banned or severely restricted sand exports, which has led to higher prices and alleged black markets.

Even when project managers do secure enough sand, stakeholder protests can threaten a reclamation project. A HKD150 billion project to add a third runway at Hong Kong’s airport received official confirmation in March and is slated to be completed by 2023. But environmentalists oppose the project, saying it will disrupt the habitat of the endangered Chinese white dolphin.

Some local resistance can often be anticipated, though the magnitude of opposition is hard to predict, says Jeroen Overbeek, ports and marine leader in Asia for engineering company Aurecon, Singapore. “These issues will crop up even if you’re operating fully within the law,” Mr. Overbeek says. “Anticipating specific project challenges is extremely difficult.”

Avoid Assumptions

Stakeholder opposition led to a scaled-back reclamation project in Forest City, Malaysia this year. The project to reclaim land for mixed-development use in Johor Strait began in June 2014 but was halted over environmental concerns expressed by area fishermen. A public review resulted in a revised project plan, in which four islands will be built by 2045 at a cost of RM450 billion.

Regulatory obstacles can also complicate projects. In countries like Indonesia and India, it’s not uncommon for project managers to encounter situations where the central government grants environmental permits or permission to use land but local authorities don’t recognize those decisions, Mr. Overbeek says. The best way for project managers to prepare is to work with local technical and legal consultants to develop an inventory of current rules and regulations as well as a scenario-planning document that anticipates legislation under consideration.

“You can only mitigate a risk if you know the risk is there,” Mr. Overbeek says.

Once a reclamation project does get the official go-ahead, it’s crucial to involve the contractor early on, says Jack HC Kerklaan, director, Akuna Dredging Solutions, Brisbane, Australia. Mr. Kerklaan, who in the late 1990s executed a large reclamation project in Singapore with JTC Corp., says geotechnical and geophysical investigations during the planning phase of a dredging project are instrumental for avoiding surprises during the execution.

“The mutual understanding and allocation of the operational, environmental, financial and political risks will result in a smooth execution with fewer surprises and the best opportunity to complete the project in time and within the budget,” he says.

Mr. Overbeek sums up the risks and challenges project managers face in land reclamation projects with simple advice: Resist the urge to make assumptions, check the facts and keep updating. “Past experience can only take you so far,” he says. —Ambreen Ali

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