We’re improving our ability to be consistently relevant across the information we provide for you. Part of the this process means we want to make it as easy as possible for you to identify quickly and simply, what career, work, or contracting opportunity is available for you in any of the updates we provide.
So, we’ve introduced a new standard of categorizing project news, updates, and new projects using a model the Department of Industry, Innovation and Science use to accurately publish information about Australia’s mining and construction developments.
Information gathered on major projects from a number of sources including company websites, ASX quarterly activity reports and media releases, and in some cases, from direct contact with company representatives. Although there is substantial investment by mining and energy companies in replenishing equipment, plant and other property, the focus of this post is on ‘major’ investments that are greater than $50 million.
Smaller scale operations that cost less than $50 million are also an important contributor to the sector and the broader Australian economy; however gathering data on such projects is challenging as many are undertaken by private companies with fewer obligations to report progress and they often have shorter development cycles. Developers of resources and energy projects often use different planning processes and assessment methods to support a Final Investment Decision (FID).
Thus, there is no standard project development model with clearly defined stages and terminology that can be applied to every resources and energy project. To broadly represent the general lifecycle of a project, the Department of Industry, Innovation and Science (DIIS) use a four-stage model of the investment pipeline to measure the potential investment in Australia’s resources and energy sectors.
To be included on the major projects list that accompanies this report, there must be evidence of project activities that support the project progressing to an FID within the next five years.
The four stages in the DIIS investment pipeline model are:
1. Publicly Announced Stage. Projects at this stage are either at a very early stage of planning (i.e. undertaking their first prefeasibility study), have paused in progressing their feasibility studies or have an unclear development path. As a result, not all projects will progress from the Publicly Announced Stage to become operational facilities. To include a project on the major projects list at this stage, preliminary information on project schedule, planned output or cost must be publicly available.
2. The Feasibility Stage. This stage of the project development cycle is where the initial feasibility study for a project has been completed and the results support further development. This stage is characterised by further studies being undertaken to finalise project scope, complete engineering designs, assess environmental impacts and develop commercial plans. Projects at the Feasibility Stage are less uncertain than those at the Publicly Announced Stage, but are still not guaranteed to progress further as evaluations of commercial prospects have not yet been finalised and all regulatory approvals are yet to be received.
3. Committed Stage. Projects at this stage of the development cycle have completed all commercial, engineering and environmental studies, received all required regulatory approvals and finalised the financing for the project. Such projects are considered to have received a positive FID from the owner, or owners, and are either under construction or preparing to commence construction. Typically, projects at the Committed Stage have cost estimates, schedules and mine output that are well defined and often publicly released. Nevertheless, plans are subject to change due to schedule delays, scope changes and cost overruns even after construction has commenced. industry.gov.au Resources and Energy Major Projects, October 2015 5
4. Completed Stage. The period of time that a project undertakes commissioning or ramps up to full production varies; however, DIIS first classifies a project as being at the Completed Stage when they have substantially finished their construction and commissioning activities to the point where full commercial level production has commenced. Earlier stages of developing mining and energy projects, such as identifying deposits and exploration activities, are not included in the model.
In future posts, project updates, and new projects being announced, we will use this 4 stage model to help you identify which stage the construction project is in, which will make it easy to determine if there is the opportunity present you are seeking within the industry or project for your own career aspirations or qualifications and skillsets.