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« Khan Resources Incorporated: Speculative trade now closed | Main | Ur-Energy Incorporated: BUY »
Monday
Aug272007

Olympic Dam Extension: When?

BHP Logo 27aug07


The resources at the Olympic Dam Project owned by BHP Billiton could be 50 per cent greater than previously calculated. The future chief Executive Marius Kloppers said:

"It wouldn't surprise me if it turns out to be the second-largest base-metals ore body ever discovered,"

He also said:

“We remain absolutely confident that Olympic Dam will be the pre-eminent supplier of uranium, underpinning much of the nuclear renaissance that is being experienced as a response to the greenhouse concerns that the world currently is seeking solutions for."

This is a long term project and we have no doubt that the time spent now on the methodology, the planning and even a proto type to ensure a smooth and orderly development, will be time well spent. This entire project could have a 100-year life span, providing uranium to the whole world. This project also has the added kicker of copper, gold and silver but we will put that to one side at the moment.

Olympic Dam Photo 27aug07

Now if you have ever worked closely with an experienced Project Manager ask yourself this question: What was the single most used word he or she ever uttered?…………………WHEN? Would be my answer. The Project Manager has to get beyond:

We are getting there
Progress is fine
We can make up lost time
What schedule?

“The Olympic Dam expansion had slipped a bit”
Quote.

Why didn’t the reporter ask from what date to what date? Investigative reporters where are you? We should not be scared of the big names we should be digging deep in order to ascertain a clearer profile of this project.
Olympic dam photo1 27aug07
The need to get it right, to be more capital efficient as they say, are motherhood statements which apply to any project. We don’t see any specifics here, any detail, which in turn suggests that we are still a fair way from the starting post for this project extension. No doubt that the shadow of Cigar Lake looms large and the concerns of the engineers are being heard and built in to the methodology for this project.

Is this the only project that has slipped a bit? Apparently not, the Ravensthorpe nickel project in Western Australia and the Atlantis oil and gas development in the Gulf of Mexico, both of them over-budget and behind schedule.

The point we want to make is that the schedule is of paramount importance and that time is money. Until BHP Billiton issue a detailed Methodology along with a detailed programme for the project the ‘on-stream’ estimates are nothing more than guestimates and should be treated as such. In a previous article touching on this area of critical factors we said that we wanted to see the following:

A well-written Mission Statement
A concise Method Statement
A detailed Schedule based on CPA and computerised utilising profession project management software not the colourful $50.00 version.
Resources applied to the schedule of labour, plant, equipment, money, etc.
An Expenditure Profile that we can monitor, if you are not spending the money you are not making the progress.


The above requirements also apply to the Olympic Dam Project

We are a long way from this project geographically speaking and therefore ask any of our Australian readers who are close to this project to write to us and illuminate this situation for the benefit of all of us.

Thanks to B for alerting us to this article by The Advertiser, which can also be located on news.com.au.

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Reader Comments (1)

Please read "The big hole" - an assessment of the Olympic Dam expansion on

The problem is that the project starts with 4 years of excavation of 3 cubic kilometres of rock from 2009 before a kg of uranium is produced in 2014. A year's delay will mean a start in 2015. Australia is a net importer of the diesel needed for the haultrucks and excavators and the process water has to rely on desalination requiring more energy. Meanwhile production is failing at the current OD underground mine. If the project is axed it will herald the end of uranium mining in Australia.

August 27, 2007 | Unregistered CommenterJohn Busby

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