PM meets the challenge on Somincor's Neves Corvo tin project

INTRODUCTION

ICF Kaiser Engineers, one of the largest engineering and construction management firms in the U. S., recently completed work on a $70 million tin concentrator plant in Portugal for SOMINCOR (Sociedade Mineira de Neves-Corvo).

Under a 15-month, $10 million contract, ICF Kaiser Engineers provided conceptual and basic engineering services, detail design, procurement, project accounting, construction management and commissioning of the plant facilities.

The new concentrator produces over 5000 metric tons/year tin in concentrates and adds over 100,000 metric tons copper concentrates, grading 25 percent copper, to annual copper production at the Neves Corvo complex. The plant has already placed Portugal among the top ten producers of tin in the world. Using modem project management techniques and a small number of expatriates working in an integrated task force with local Portuguese engineers and construction contractors, the plant was engineered and constructed in record time.

The plant, which was dedicated May 11, 1990, by Portuguese Prime Minister Cavaco Silva, was completed $4 million under budget and almost three months ahead of the 15-month schedule. A remarkable achievement considering the tight schedule, complexity of the flowsheets, that equipment and material were imported from 13 countries on four continents and that only 5 percent of engineering had been completed before construction started.

Site preparation began in October 1988 and construction in December 1988, but first equipment orders were not placed until February and flowsheets only finalized in April 1989. There was thus a large overlap between engineering, procurement and construction throughout the project. The first ore was processed on January 15, 1990, 80 days ahead of the scheduled startup date of April 1.

BACKGROUND

The Neves Corvo mine complex is situated in southern Portugal, 250 km south of Lisbon.

The mine complex, which includes the underground mine and copper concentrating plant, is operated by SOMINCOR which is jointly owned 51 percent by the Portuguese state company Empresa de Desenvolvimento Miniem (EDM) and 49 percent by Rio Tinto Zinc Corporation (RTZ) of the United Kingdom. The copper mine, one of the richest in the world, began production in 1989 and immediately tripled the value of Portuguese mineral exports. ICF Kaiser Engineers (ICF KE) was also the managing contractor for the design and construction of the copper processing, mine infrastructure facilities, concentrate storage and ship loading facilities at the port of Setubal.

During construction of the copper processing facilities, development drilling revealed the presence of high-grade tin mineralization zones. In order to exploit this tin bonus, a decision was made by SOMINCOR to investigate the construction of a separate concentration plant for tin-bearing ore to be implemented as quickly as possible. The timing was crucial, since mine planning for copper production necessitated the mining of both copper and tin-bearing ores, otherwise, the tin ore would be lost.

A feasibility study and cost estimate were prepared by ICF KE for a tin concentration plant, and at the same time laboratory test work was carried out by RTZ in Bristol, England. This was followed by basic engineering work which was completed in March 1988. A decision was made by SOMINCOR in October 1988 to proceed with the project.

Because of their past performance in bringing the copper concentrator and support facilities into production ahead of schedule and under budget, SOMINCOR awarded the engineering, procurement and construction management (EPCM) contract for the tin concentrator to ICF KE without competitive bidding. The contract was awarded on a fixed fee cost-plus basis with a bonus/penalty clause tied to final capital cost and completion date.

ICF KE qualified for and received the maximum bonus stipulated in the contract.

ICF KAISER ENGINEERS

Headquartered in Oakland, California, ICF Kaiser Engineers is one of the nation's largest engineering and construction services firms, providing services to clients involved with environmental, industrial, and infrastructure projects around the world. The firm, along with its sister companies Tudor Engineering Company and Cygna Group, is a subsidiary of ICF International, Inc., based in Fairfax, Virginia. The ICF companies employ nearly 4,700 professionals in more than 100 offices worldwide. The firm reported revenue exceeding $690 million in its latest 12 months.

ICF Kaiser Engineer's professionals are at work on hundreds of projects in over a dozen countries. Current projects include construction management of the cleanup of Boston Harbor, a 12-year, $6 billion effort; contracts worth more than $250 million to provide technical support to the U.S. Environmental Protection Agency's Superfund hazardous waste cleanup programs; program management and systems engineering for the $26 billion Taipei rapid transit system; program and construction management for a $4 (Australian) billion liquefied natural gas facility on the Northwest Shelf in Australia; design and implementation of environmental monitoring systems and cleanup programs at 32 coke plants in the former Soviet Union; and electrical and mechanical design engineering and specification services for a 16 kilometer extension of the Jubilee subway line in London.

PROCESS

The tin concentration plant is located within the industrial area of the mine complex and due south of the copper concentrator building. The tin plant operates independently of the copper concentrator with the exception of shared facilities of coarse ore stockpiling and some utilities. The tin concentrator treats two types of ore in separate circuits: 200,000 metric tons/year (30 metric tons/hour) massive sulphide (MS) ore with a design head grade of 1.3 percent tin and 16 percent copper and 100,000 metric tons/year (15 metric tons/hour) rubane tin (RT) ore with a design grade of 6 percent tin and 2 percent copper. Tin is recovered by both gravity concentration and flotation circuits with the objective of achieving overall tin recovery of 70 percent. The high and variable head grades, and the association of tin with sulphides, make for extremely complicated flowsheets which had to be designed for maximum flexibility.

It was decided to build a separate concentrator to treat the tin ores because of the two distinct ore types, and because much of the tin is associated with high grade copper. Simply adding a gravity treatment section to the end of the copper circuit would have meant a very large plant to treat the full tonnage of 165 metric tons/hr, and dilution of high tin grades with low grade areas to come would have led to unacceptably low tin recoveries. Since most of the MS tin is associated with high-grade copper, it would also have denied the company the benefit of additional copper production.

MS copper flotation differs from the main copper-plant flowsheet in that primary-copper scavenger tails and copper-regrind circuit tails am treated in separate circuits for pyrite flotation prior to the tin tabling and flotation circuits. This results in higher tin recovery with pyrites grading 38-39 percent iron and 1-2 percent copper pumped to final tailings.

Concentrator Plant

The concentrating plant consists of coarse ore reclaiming and crushing facilities, crushed ore storage, grinding, shaking table and flotation areas, concentrate dewatering and loadout, intermediate and concentrate thickening, tailings transport and utility systems. Details on some of these systems are:

Five of the Sala Lamella thickeners, a technology which substantially reduced the floor area of the plant.

• Ore storage, reclaim and crushing: Run-of-mine ore crushed to 300 mm is transported to a coarse ore stockpile by the existing stacker. MS and RT ore are stockpiled and reclaimed separately. Reclaim is by wheel loader to a reciprocating plate feeder and conveyed to the crushing facilities. Ore is primary-crushed to minus 50 mm in a jaw crusher and conveyed to the secondary crushing/screening building. Ore is reduced to minus 10 mm by secondary and tertiary cone crushers in combination with a vibrating screen. The product is conveyed to the fine ore silos for separate storage of MS and RT ore.
• Grinding: The MS ore is withdrawn from the fine ore silos by belt feeder and fed to a two-stage ball mill circuit for grinding to 80 percent minus 35 microns. The ground ore in pulp flows to the copper flotation area. RT ore is ground in a separate rod mill/ball mill circuit to minus 0.6 mm and pumped to a hydrosizer for distribution to the tabling area.
• Tabling: The tabling area consists of banks of coarse, intermediate, and fine Wilfley shaking tables where the gravity concentrate of tin ore is recovered from the RT ore. A circuit is included to regrind the coarse table concentrates and remove sulphides. A second regrind circuit is installed for coarse table tailings for further liberation of tin.
• Flotation: Ground MS ore is treated in banks of flotation cells and a final concentrate is produced after three stages of cleaning. Tailings are reground in ball mills and are treated in separate circuits for pyrite flotation prior to gravity tin recovery. Sala Lamella thickeners are used extensively for intermediate thickening.
• Devandring and loadout: Coarse concentrates are dewatered on a vacuum belt filter and discharged to a conveyor for direct loadout to standard 20-metric-ton containers. Fine tin concentrates are thickened and dewatered by multiroller belt filter press and loaded into containers.
• Reagents; The flotation process requires the preparation and addition of various reagent solutions, including lime, sulphuric acid, aero promotor, potassium amyl xanthate, and others. The reagents are stored, prepared, and metered by specialized equipment in a separate area of the building.

Figure 1. Neves Corvo Tin Project Construction Progress

The majority of the process equipment is housed in the main 60-meter by 74-meter concentrator building. All of the buildings are concrete and steel construction. The equipment, piping and electrical systems, though relatively small in size, are numerous and extensive. There are 6 grinding mills, 31 banks of flotation cells of various sizes, 70 shaking tables, 200 pumps, 660 electric motors, 25 km of pipe and 240 km of electrical cable and over 1000 instruments installed.

PROJECT MANAGEMENT CHALLENGES AND PROBLEMS

SCOPE OF WORK

The general scope of work on the project was split into two phases:

A clear and detailed definition of the scope of work to be performed is essential for the successful management of all projects. The scope of work on the tin concentrator project was defined in the conceptual and basic engineering phases.

Basic Engineering

A set of basic engineering drawings, together with the project cost estimate and project schedule, were prepared and presented to SOMINCOR in a report which was used to decide whether the project should go ahead or not. After negotiations and adjustments, these documents were made the basis for determining scope changes after award of the EPCM contract.

Process Flowsheets

The basic engineering documents defined the scope of work as it was known or conceptualized at that time. Due to the fact that the tin bearing mineralization zones had only recently been discovered in the ore body the knowledge of the ore structure and chemistry from the drilling program was very limited and the laboratory test work to establish a suitable treatment process had only just gotten under way. To circumvent this difficulty ICF KE, SOMINCOR and RTZ minerals processing experts devised process flowsheets for the treatment plant based on this limited knowledge and their experience on similar ores and treatment plants. There was considerable opposition to this approach in view of the lack of adequate large scale test work of the process and the risk involved in the large capital investment. Under normal circumstances process flowsheets and equipment selection would not have been determined until laboratory and pilot plant programs were completed and the results analyzed in depth. In fact, between the completion of basic engineering and the decision to proceed, SOMINCOR solicited bids for the construction of a five metric tons/hour pilot plant to confirm the laboratory results and flowsheet. However, after further consideration this idea was dropped mainly due to the time required to procure the plant and complete the test program. Mining and stockpiling of tin ore was considered but ruled out since oxidation of the ore is detrimental to the concentration process. It was therefore decided to proceed with the plant on the basis of the conceptual flowsheets with provisions included, where practical, for adjustments at a later date.

Process Changes

During the course of detailed engineering, major changes were made to the flowsheet as the testing program matured and the process engineers had time to study the increasing amount of data being generated. For the engineering/design group in the Lisbon office, accommodating these major process changes within the extremely tight schedule became the major problem and challenge of the team. Since these process changes affected all design disciplines, and in many cases equipment and materials selection, the response to changes had to be rapid and close coordination was essential. The task force approach, utilizing an experienced team dedicated exclusively to this project, was the key to managing this problem.

Additions to Scope

Later in the project, work was added to the tin plant scope, this was in the form of major buildings and facilities added by change order after designs and cost estimates had been submitted and approved. The engineering and procurement for the additional facilities were meshed in with the original work and all design was completed by the end of October 1989 and construction was completed by the end of April 1990.

Mine Planning

The project schedule was dictated to a large extent by the mine planning for ore extraction from the underground mine. This activity required long-range planning. Once the plans were made and put into effect, changes could not easily be made without jeopardizing the ore production schedule. The original mining plans were drawn up for copper production only and on the basis that the bulk of the so-called waste material would remain underground.

With the discovery of high tin content in the waste material, the mining methods and operations were re-examined to determine how best to extract this tin bonus without disrupting the copper ore production schedule. The decision to proceed with building the tin concentrator was made in conjunction with the revised mining plan. Since long-term stockpiling of ores on the surface was not a viable option, the start-up of the concentrator had to coincide with the planned extraction schedule for tin ore. For this reason and other economic considerations, SOMINCOR, upon the decision to proceed, imposed an extremely tight schedule for completion of the plant and negotiated a bonus/penalty clause on the scheduled completion date as well as the final capital cost.

PROJECT SCHEDULE

For the Phase II scope of work outlined earlier, i.e., detailed design, procurement, construction management and no-load commissioning, the contract specified a 15-month schedule with the project kickoff date of January 1, 1989. The management challenge presented by this schedule was daunting but, with ICF KE prior experience on the copper project and essentially the same task force team in place, there was confidence that the schedule could be met and exceeded.

The tin concentrator plant in its entirety was turned over to and accepted for on-load operations by SOMINCOR on January 12,1990. On-load operations started on January 15,1990.

Fast-Track Basis

In order to plan, engineer, procure, and construct a project of this magnitude and complexity in 12 months, the project, of necessity, had to be managed on a fast-track basis. This involved overlapping the engineering, procurement and construction phases of the project to compress the overall schedule, and required much more coordinated planning and management control. Of primary importance was a project schedule which was planned in detail with the collaboration of the engineering, procurement and construction management groups and which had the full support of the client's project team.

ICF KE's Project Management System (KEMS) was used in the early planning stages to setup the project master schedule. The KEMS produces a CPM schedule from the data base of activities and durations for engineering and construction.

Early Start Authorization

A SOMINCOR decision to proceed with Phase II work on a limited basis two months ahead of the contractual start date was instrumental in achieving a compressed schedule.

This authorization allowed engineering to proceed with the detailed design of the foundations and structures for the crushing buildings, fine-ore bins and main concentrator building and for construction work to follow on these facilities. As the process design was not established at that time, it was hoped that the authorized work would not be subject to change as the process design developed.

PROJECT TEAM/ORGANIZATION

The tin project was performed by a fully integrated project task force team comprised of ICF KE expatriate staff (16%), ICF KE local hire staff (32%) and personnel from a local Portuguese engineering company Lusotecna (52%). ICF KE provided overall direction and responsibility for the project.

The project task force was initially split into two teams; the project management and engineering team located in the Lisbon office, and the construction team located at the jobsite approximately 250 km to the south. Project staff paid frequent visits to the jobsite and construction staff likewise visited the Lisbon office to coordinate the work. A daily courier mail service was installed, in addition to communication by telefax and telephone. As construction approached completion, key project team members relocated to the jobsite to form the plant commissioning group.

Table 1. Neves Corvo Tin Project Major Statistics

Client Organization

The client, SOMINCOR, installed a senior project manager in the ICF KE Lisbon office to interface directly with their ICF KE's counterpart. This in-house client representative had the approval authority on all major decisions affecting schedule and cost.

In addition, SOMINCOR installed a process specialist and project controls manager in the Lisbon office as counterparts to ICF KE's engineers in these roles.

Similarly SOMINCOR installed a senior construction manager at the jobsite as the counter part to ICF KE's construction manager.

Integrated Team Approach

A major challenge on foreign projects which are undertaken using local-hire personnel for the bulk of the work, is the integration of the different working methods of the expatriate and local-hire team members. In addition to communication difficulties due to language and terminology, the design and construction codes, standards and references for the project must be established so that the work product is acceptable and complies with local requirements. Since cooperation on a fast-track job is paramount and the expatriate staff are often recruited from different backgounds, much more attention must be paid to achieving good working relationships between these team members. Again there are housing and transportation problems to be resolved with the expatriate staff and their families and personnel administration must be responsive to their needs or the effectiveness of the team may be disrupted. The tin project, by and large, followed on the heels of the main Neves Corvo Copper concentrator project, which ICF KE also managed. The timing was such that many of the key members of that team both in Lisbon and at the job site transferred to the tin project so that working relationships continued and established procedures and standards remained in place with only minor modifications.

As was the case for the copper project, the task force team was augmented from time to time, on an as-needed basis, by temporary expatriate, project and design specialists from the home office.

ENGINEERING

In November of 1988, authorization was given to proceed with the detail engineering and construction on a limited basis for the concentrator building structure.

Although the process flowsheets were far from finalized and no equipment purchase orders had been awarded, design of the building foundations and steel structure went ahead based on the best judgment of location and loads for equipment, platforms and utilities.

Selection and purchase of long-delivery equipment was a critical item on the schedule and the process/project engineers started in January 1989 on the selection of major equipment in collaboration with SOMINCOR process engineers and consultants. Detailed technical specifications were written and approved by SOMINCOR, bids were analyzed and recommendations for purchase were issued. A total of 75 equipment specifications were produced by the engineering department for the project and by February 1989, 14 major equipment purchase orders had been awarded.

All of the design work was done in the Lisbon engineering office. A small expatriate engineering staff supervised the Portuguese design engineering staff. The Lisbon engineering office was a complete, self-contained task force operation. It was totally dedicated to the tin project. By the end of January 1989 the Lisbon total staff had reached 70 people and the engineering, which was well under way, had progressed to 25 percent.

Finalized Flowsheets

Because of the complexity of the process and the design flexibility required, the spring of 1989 was difficult because the flowsheets could not be finalized. This was because test work being done (by RTZ in the U.K). on the ore indicated that some of the early process decisions made by RTZ had to be modified and/or changed. Although there were valid reasons for the flowsheets to be slow in freezing, the net result was an obstruction to the engineering progress.

This problem affected all engineering disciplines. In the engineering office this problem was most evident in the piping discipline, as pump and line sizes were continually changing, affecting purchase orders and equipment deliveries. In construction this problem caused considerable trouble in revising equipment foundations, platforming, stairways, and floor grating.

Essentially all of the flowsheet problems were resolved in April 1989 and engineering accelerated from that point onto completion.

Design Work

The original engineering work was scheduled and budgeted for that work described in the capital cost target estimate initially submitted to SOMINCOR at the end of March 1989 and approved by SOMINCOR in late June 1989. This work required a total of 521 design drawings and 56,000 design labor hours.

During the course of the detail engineering several facilities were added to ICF KE's scope. This additional work (approximately 21 percent of the original scope of work) was for the following facilities:

• Change house facility
• 5 km tailings pipeline and related facilities
• Copper filter for handling tin plant production
• Plant air compressor facility

These facilities required 110 additional drawings for an overall drawing count of 631 and 65,000 total design labor hours. Engineering, including management, process, equipment specifications and detail design required 82,000 labor hours, or 32 percent of the total project labor hours. Engineering in Lisbon reached 100 percent complete by the end of October 1989.

Near the completion of the Lisbon engineering, certain key engineers relocated to the jobsite to form the checkout and commissioning team.

Upon construction completion of each facility, the “As Built” drawings were finalized at the job site and reissued to SOMINCOR.

PROCUREMENT

Procurement functions for the tin project included purchasing, inspection, expediting and traffic, customs clearance and warehousing. ICF KE managed the procurement of all equipment and material required for the project. Procurement of equipment and some material was handled by the Lisbon office. The remainder of the construction materials and miscellaneous items procurement was initiated and controlled by the job-site office. The Lisbon office was updated on all job-site purchases through the KEMS integrated materials control system by means of computer terminal. This proved to be a very satisfactory arrangement, allowing the field engineers to contact vendors directly to expedite supplies or special deliveries yet keep the Lisbon office informed of all orders and quantity changes to eliminate the possibility of duplication.

The procurement organization started with one purchasing agent and two expediters and peaked at two purchasing agents, four expediters and one traffic manager.

Equipment Purchase

A total of 410 new purchase orders and 475 change orders were issued for all equipment, material and services to 13 countries throughout the world. Much of the equipment and materials for the project were obtained from outside of Portugal, from numerous countries including the U. S., Canada, Japan, Australia, Brazil, Sweden, United Kingdom, Netherlands, Spain, France and Germany. Most of the fabricated steel items such as chutework, launders, tanks, conveyor structures and cranes were obtained in Portugal. All electrical equipment was also purchased and fabricated in Portugal, with the exception of electric motors.

Froth flotation cells are used to recover the copper and tin.

All equipment was competitively bid from detailed technical specifications prepared by ICF KE. In general, the best equipment at the lowest price was purchased. Early delivery to meet the project schedule was an important consideration but equipment quality was never compromised.

Traffic and Expediting

All equipment and most of the materials were purchased ex-works. ICF KE's traffic manager made all the transportation arrangements and the expediters coordinated the deliveries through the SOMINCOR customs broker. Due to the tight project schedule, emphasis was given to expediting to pressure vendors to meet promised delivery dates.

Factory visits were made for inspection and expediting and as necessary when slippages in deliveries were detected or to resolve engineering or contractual problems which might result in late deliveries. An open-order status/action report kept management informed of potential problem vendors allowing action to be taken at a higher level where a situation became critical. Purchase orders were written to include penalties for late delivery of equipment where there was no reasonable justification for delays. Penalties were applied in a number of cases.

Late Deliveries

Critical major equipment which suffered delays and impacted the scheduled installation of equipment were flotation cells, grinding mills and 6 kV switchgear, all long-delivery items. The reasons for delay were a combination of vendor personnel problems and defective fabrication which required rework. Early warning of these delays by expediting enabled construction management to implement alternate plans without losing productivity.

CONSTRUCTION MANAGEMENT

In order to take advantage of the presence on site, albeit already reduced, of the contractors who had been involved on the copper project, SOMINCOR decided to authorize the start of the concentrator building construction work as much as two months before the official go-ahead on the tin project. At the time of construction start engineering was less than 5 percent complete. Such work was necessarily restricted to the main concentrator building foundations and structural steel shell, i.e., work not dependent on either the process which was not finalized or vendor information, as no approval had been given to make equipment purchases.

This situation, together with SOMINCOR's stated request to have the tin project engineered and constructed as early as physically possible, was going to require an extremely high level of flexibility, innovation and cooperation from the contractors because of the consequent “last minute” changes and short time to do the necessary forward planning. It was therefore agreed between SOMINCOR and ICF KE that the best strategy for the construction of the tin project was to limit the bidders list for each of the main construction packages to contractors whose capabilities had been tested and proven on the copper project.

Contracts

A total of 14 major construction contracts were awarded.

The scope of work for each of the major contracts was basically defined along the various disciplines; namely, earthwork, concrete, structural steel, mechanical/piping, conveyors and electrical/instrumentation. It was not considered necessary to split any one discipline into two contract packages. The main reason behind this philosophy was our need to make the various packages sufficiently attractive to promote competitive pricing amongst the bidders in spite of the limited bidders lists. This concept was complemented by our foreknowledge, from past experience on the copper project, that none of the contract scopes were beyond the respective selected bidders' capabilities.

Construction contracts were mainly issued on a unit-price basis when the full scope of work was not fully defined at the time of bidding and award. Lump-sum contracts were awarded for work fully defined at the time. Contractor progress claims and subsequent payment to them was based on installed quantities, measured and verified by ICF KE. Time-and-material contracts were avoided and only minor work, such as cleanup, was done on a time and material basis. Construction, including no-load commissioning, was completed on January 12, 1990, and all construction contracts for the main scope of work were closed on February 28,1990.

The construction workforce peaked in November 1989 at 800. The Portuguese contractors, aided by ICF KE, performed very well and the final result was a finished quality product.

Materials Control

ICF KE experience on the Copper project showed that the Portuguese contractors in general were not able, either administratively or financially, to do the procurement of materials in a manner which responded to the schedule demands. It was therefore decided that all materials were to be purchased by ICF KE and free issued to the various contractors. In view of this philosophy and also because of the virtually non-existent time gap between engineering and construction, ICF KE implemented a fully integrated materials control subsystem within KEMS, which enabled procurement of materials to be centralized in the field. This strategy proved to be highly effective and possibly the single most important factor in anticipating the “ready for on-load startup” date by almost three months.

COMMISSIONING

For the tin project, SOMINCOR referred to two distinct types of commissioning; dry commissioning and wet commissioning. Dry commissioning was done by ICF KE under no-load conditions and covered the material handling equipment from the ore storage piles, through crushing and screening, fine-ore bins, reclaim feeders, and the rod/ball mill feed conveyors. The dry area was turned over to SOMINCOR for on-load operations at the end of November 1989.

Ball mills and a rod mill in the grinding bay are used to grind ore until 80 percent of it is smaller than 35 microns.

Wet no-load commissioning was done by ICF KE using water only in the process circuits. This wet commissioning covered the remainder of the plant not included in the dry commissioning.

As part of construction, and prior to no-load commissioning, all elements of construction were checked out, deficiency punch lists were prepared and rectifications were made. These punch list deficiencies at that point were usually visual items related to earthwork, concrete, steelwork, pipe supports, architecture, and the like. Non-visual items generally related to mechanical, piping, electrical and instrumentation work. These non-visual check-outs involved running all equipment under no-load conditions where drives, motors and machinery were tested. This no-load running of equipment also assisted in proving out the integrity of the electrical power, control and instrumentation systems. All safety devices and interlocks were checked out. During the check-out, all pressure pipes were hydrotested and leaks, if any, were sealed.

Ball mills and a rod mill in the grinding bay are used to grind ore until 80 percent of it is smaller than 35 microns.

Commissioning Group

The commissioning group was mainly comprised of key Lisbon engineering personnel relocated to the job site and construction engineers already at the jobsite. It was a relatively small organizational group comprised of the following:

In order to commission the plant in a logical sequence, the entire plant flowsheet was broken down into numerous small controllable closed loop, mini-circuits. Each mini-circuit could therefore be checked out independent of other circuits. The commissioning team broke into several groups, and each group was assigned their own mini-circuits for commissioning. This greatly accelerated the commissioning program.

During this no-load commissioning all mechanical, piping, electrical and instrumentation devices were checked out for proper operation. Additional pipe supports were added where required. Local and remote control operation from the Distribution Control System (DCS) was checked out. All instrumentation was calibrated on water and their digital and analog signals to and from the DCS were verified.

Prior to the turnover of the tin plant to SOMINCOR for their on-load commissioning, every part of the plant had been tested and checked out.

The entire cold commissioned plant was turned over to SOMINCOR on January 12, 1990, for their on-load operation.

Cost Control/Accounting

Project capital costs and ICF KE services costs were controlled using the KEMS computerized project control system. The KEMS system controls cash needs and expenditures, including different foreign currency requirements.

The capital cost estimate approved after the completion of basic engineering was updated when detailed engineering was 35 percent complete and after approval by SOMINCOR this became the target estimate for calculation of the bonus/penalty. Spare parts, escalation, currency fluctuations were also estimated and controlled, but were excluded from this estimate.

ICF KE managed all capital funds required for the-project and opened bank accounts in Lisbon and London for payment of local and foreign supplier invoices. A full accounting service was provided for capital costs as well as service costs with cash flow forecasts for payments.

ICF KE was also responsible for bookkeeping and fiscal maintenance of all project costs (accounts payable, accounts receivables, payment certificates, invoice logs, governmental and regulatory compliance requirements, and so forth).

Cost reports used the “earned value” concept for reporting the expenditures. The earned value was calculated based on the physical progress of the services, supply and construction activities. A fixed exchange rate was established and used to convert foreign currencies for project budget purposes. All costs were reported in Portuguese escudos, Periodic adjustments were made to the project cost report to account for the actual exchange rates on the date of payment.

MANAGEMENT APPROACH

PROJECT MANAGEMENT METHODS

At ICF KE, talented and dedicated professional personnel are central to successful project management and control. On projects large and small, self-sufficient, integrated project teams are assembled with top-level corporate management commitment and communication. These project teams work closely with the client, To perform management and control functions, an integrated set of concepts, procedures, and computer applications are employed. These enable the control of schedules and costs through careful and realistic planning during detail design, procurement, and construction. This approach provides for timely and economical completion of projects and enables the client to be kept informed of change in progress and costs. The basic parts of the approach—planning, monitoring, analyzing, and reporting-are defined briefly below.

Planning

A project plan is formulated encompassing strategy and implementation. A numbering system and control criteria are prepared, and work activities classified. On the basis of these data, a critical path method (CPM) schedule, cost estimate, and procedures for monitoring cost and progress are developed. These provide primary baselines during design, procurement, and construction.

Once the client has approved the initial plans, the estimates contained therein are developed into control budgets, the schedule becomes the formal project master schedule, and the various procedures become the project procedures manual.

Monitoring

All basic work elements are continually measured and the information used to update the control data. Engineering, detail design, procurement, and construction are monitored for conformance with established progress and performance criteria. The work as shown by the drawings is reviewed for constructibility and value engineering.

Analyzing

Based on previously established criteria and targets, performance is analyzed as the project advances with respect to fact&s such as:

• Cost during the report period
• Cost experienced to date
• Estimated cost to complete
• Estimated cost at completion
• Progress to date
• Estimated completion date

Any problems that arise are promptly flagged and analyzed, and appropriate remedial action is recommended.

Reporting

Results of monitoring and analyses are communicated through periodic status and performance reports. Developed either manually or by computer, depending on project magnitude and required level of detail, these reports are action-oriented. They alert management both to impending scheduled actions and to deviations from project plans that require special remedial action.

PROJECT MANAGEMENT PLAN

Early establishment of detailed requirements to meet the scope in the tin project contract were essential for the success of the project. These requirements were spelled out in the Project Management Plan which was used by key project team members to establish baseline criteria for the project scope, regulatory requirements, schedule and budget.

Procedures

A project-specific procedures manual was prepared on a departmental basis and made available to all team members. The project procedures standardized the relations between departments and between ICF KE and the client and included sample forms. The procedures for the Lisbon office covered topics such as: delegation of responsibility, correspondence control, communications, project cost control, project change orders, travel expenses, time card control, accounting, design calculations, drawings, specifications, equipment numbering, equipment and material purchasing, inspection, expediting, and traffic.

Similarly, for the job site, procedures were prepared covering all aspects of construction, including operator training, checkout, commissioning, and project closeout.

Technical Criteria

The criteria to define the technical parameters of the tin project were established during the basic engineering phase. Therefore, detail design and construction activities could proceed without possible delays for lack of information. The criteria defined the requirements for process, project, design, and construction,

• Process criteria described the process technology and included plant capacity, operating hours, material balances, flowsheets, unit operations, utility, and energy requirements.
• Project criteria defined the facilities to be designed and constructed with information on location, climate, seismic activity, codes and regulations, and environmental requirements.
• Design criteria defined the engineering standards, codes, and regulations to be adhered to during design and sections were written covering each of the design disciplines.
• Construction criteria defined the standards to be followed for civil work, concrete placement, steel erection, mechanical and electrical installation, safety, and environmental permitting.

PROJECT MANAGEMENT AND CONTROL SYSTEM

ICF KE has developed a project management system known as KEMS. It has been used successfully on all sizes and types of projects. KEMS is an integrated set of management concepts and procedures implemented by a PC-based proprietary program. Project control functions and activity data are fully integrated in all project phases utilizing eight operating modules. Seven modules are fully independent functional modules and the eighth is a utility module designed to enter and share common information among the functional modules. Together, these modules control all phases of project development.

Computer terminals installed in the Lisbon office and at the jobsite allowed data to be entered by the various departments so that the progress of activities could be monitored on a day-to-day basis. Management was therefore provided with up-to-date information at all times on the status of all aspects of the project and could make rapid, informed decisions to control the project.

ICF KE control procedures follow the management-by-exception method by trending actual cost and progress against approved targets. The earned-value concept is used for control by measuring and analyzing actual cost and progress against planned accomplishments. Department managers, therefore, focused their attention on those activities which were critical to the schedule or project cost.

ACTION

Raymond E. List, President ICF Kaiser Engineers

ICF Kaiser Engineers is proud of the success of the Neves Corvo Tin Project. In large measure the success was due to the foresight of the owner, SOMINCOR, a jointly owned company of the Portuguese state company Empresa de Desenvolvimento Mineiro (EDM) and Rio Tinto Zinc (RTZ). SOMINCOR recognized early in the project cycle the importance of selecting a project manager with the right kind of management experience, of providing sufficient up-front investment funds, and putting in place the right systems and client organization to establish an excellent contractor/owner relationship.

SOMINCOR is an exacting client, but flexible and fair, the kind of client with whom ICF KE prefers to do business.

As a result of SOMINCOR'S prompt and knowledgeable decisions and actions, the project was completed and accepted by SOMINCOR in 12 months (3 months ahead of schedule). This project contributes significantly to the economic well-being of Portugal and demonstrates vividly the importance of two major aspects of project management-close contractor/owner relations and fast-tracking.

LESSONS LEARNED

At first sight, the problems and risks associated with the tin project, designing a plant, procuring all the equipment and materials, constructing and commissioning the facilities, all within the space of 12 months would seem to be formidable. However, with good management techniques such as detailed planning, procedures and controls, a responsive management control system providing up to date and timely information and a dedicated task force team of experienced personnel, challenging projects such as this can be successfully completed.

For a project to be successful, these techniques, systems and personnel should preferably be in place prior to the project kickoff as was the case with the tin project which had the benefit of the earlier copper project experience. If not, sufficient time must be allowed in the schedule for preparation of procedures, installation of management systems and assembly of the team. The project should have a written management plan used by key team members defining the project scope, organization criteria, regulatory requirements, schedule and budget such that a clear direction to the project is established.

Another key to success, reinforced on the tin project, was maintaining good client relations. Principally this involved keeping the client informed of progress and of potential problems such that solutions could be worked out in good time. Close cooperation with the client's project team enabled the many problems associated with process changes to be overcome without impacting the schedule or quality of the final plant. On site, the extensive practical experience of the client's construction manager simplified matters in terms of expenditure approvals, rate changes and, ultimately, in terms of handing over to SOMINCOR a plant which was to their full satisfaction.

In addition, on the tin project good relations were maintained with the construction contractors by ensuring all were accorded fair and equal treatment. Late in the project incentives were given to key contractors if they could improve the scheduled completion dates for their work. This fostered a certain amount of competition and prevented the frequently encountered drop in productivity as a project nears completion.

ICF KE, through its subsidiaries Kaiser Engineers International and Kaiser Engineers and Constructors Inc., has over the years worked in more than 80 countries throughout the world providing a wide range of services. Within the company there are substantial personnel resources with broad international experience. The expatriate management and engineering personnel who served on the project were selected for their prior international experience and language skills as well as their professional expertise. Fluency in Portuguese was invaluable, particularly in procurement and construction in dealing with local vendors and contractors. Both the procurement and construction managers were fluent in Portuguese, Spanish and French. Communications on the project were in both English and Portuguese. Correspondence, specifications and contracts were prepared in both languages in addition to the required reports, permits and other documents for local government and municipalities.

The Portuguese engineering professionals are, by and large, multilingual and the majority are fluent in English or have a good working knowledge of it. They are familiar in some disciplines with American practice, however, being a member of the European Economic Community; standards and practices follow EEC regulations. The project design standards were written incorporating both U.S. and Portuguese codes and regulations. The metric system was used for all design calculations and drawings.

In procurement, experience was gained on the previous copper project, and many of the same equipment and materials suppliers were utilized. For that project and the tin project the company was fortunate in hiring a buyer with excellent knowledge of local vendors, practices and customs.

At the job site, again, the earlier copper project experience helped greatly in supervision of the contractors. Building practices in Portugal are significantly different than those of North America and must be taken into consideration to utilize the contractors labor force efficiently.

“Due to the excellent relationships established with SOMINCOR, local engineering companies and contractors, ICF KE has secured additional projects at the Neves Corvo industrial complex and is pursuing other projects in Portugal in collaboration with local companies.”

Shashi K. Bubna is presently serving as senior vice president of ICF Kaiser Engineers, responsible for Industry Group-West Operations.

He obtained a Master of Science degree in mechanical engineering from the University of California Berkeley and a Bachelor Degree in mechanical engineering from Bihar Institute of Technology, India.

Mr. Bubna has spent 13 out of his 25 years experience managing several large international design and construction projects. These include Neves Corvo Tin Project and Neves Corvo Copper Project in Portugal; and Carajas Iron Ore and Caraiba Copper Project in Brazil.

James J. Anderson is a senior project engineer with ICF Kaiser Engineers in the Industry West Operations Group.

He has a Bachelor of Science degree in mechanical engineering from Glasgow University, Scotland. He served as engineering manager for the Neves Corvo Copper Project in Portugal.