The Cumberlands Alice Darwin Railway Project Management Discussion Was it an internal or external project on railway a feat of project management The Alice

The Cumberlands Alice Darwin Railway Project Management Discussion Was it an internal or external project on railway a feat of project
management The Alice-Darwin railway Was it an internal or external project? Give rationale.
Identify at least 7 major stakeholders for the project.
What were the needs / expectation of each stakeholder?
Identify and describe at least 4 most important resources used in the project.
State 3 alternative approaches for the project (i.e. different forms of transportation).
In your opinion, was the railway approach the best approach to have been selected? Support
your rationale using PV, NPV, IRR, B/C. (1 page)
Provide a Level 3 Work Breakdown Structure (WBS) for this project. (1 page)
Create a network diagram for the project using the activities in the WBS. (1 page)
Using a GANTT chart, provide a high-level schedule for the project. (1 page)
Provide a high-level budget (or cost breakdown) for the project. (1 page)
What were the 2 major / broad categories of risks in the project?
Using a table / bullets, list at least 10 individual risks ranked by severity and project phase (i.e.
pre-construction & post-construction). (1 page)
Describe at least 7 things that were done /could have been done to mitigate the risks
Was the project a success? Support with rationales.
Was there enough outsourcing in the project? Explain.
Describe at least 3 lessons that can be learned from this project.
Other – Abstract, Introduction, Conclusion (one paragraph each)
Other Considerations
Other – APA (Times New Roman, 12, double- spaced, in-text citations, grammar, reference list,
etc)
Required to submit:
Your response should cover between 12 – 15 pages only.
This research project requires you to tie together everything you have studied in this semester.
This may include core project management skills, writing skills, APA formatting, meeting
deadlines, etc.
Ensure all responses you provide (including numbers, tasks and other facts) are supported by
information from the
journal or provide appropriate assumptions where necessary. This journal including all other
sources should be correctly referenced.
Use effective in-text citation to help the reader know exactly where you are picking your facts
from.
APA requires the use of page numbers primarily for direct quotes.
However, just for this sake of this assignment, since I need to know exactly where you are
picking the facts from,
please use page numbers as often as you need to. If I cannot connect your rationale with the
pages, I may not give the maximum points for that section.
You have been put in teams so you can bounce ideas off each other – no one person knows it all.
This is a good opportunity to access your respective strengths and weaknesses and work together
as a team.
Australian Journal of Civil Engineering
ISSN: 1448-8353 (Print) 2204-2245 (Online) Journal homepage: https://www.tandfonline.com/loi/tcen20
The Alice-Darwin railway: a feat of project
management
Dick Lees
To cite this article: Dick Lees (2005) The Alice-Darwin railway: a feat of project management,
Australian Journal of Civil Engineering, 2:1, 25-36, DOI: 10.1080/14488353.2005.11463916
To link to this article: https://doi.org/10.1080/14488353.2005.11463916
Published online: 22 Sep 2015.
Submit your article to this journal
Article views: 20
View related articles
Full Terms & Conditions of access and use can be found at
https://www.tandfonline.com/action/journalInformation?journalCode=tcen20
technical paper
25
The Alice-Darwin railway: a feat of project
management*
Dick Lees
General Manager, Special Projects, Kellogg Brown & Root Pty Ltd
Honorary Fellow, Institution of Engineers, Australia
Fellow, Australasian Institute of Mining and Metallurgy
SUMMARY: This paper describes the project management of the 1420 kilometre Alice Springs to
Darwin railway. The sponsor group included the Commonwealth, South Australian and Northern
Territory Governments. The Asia Pacific Transport Consortium delivered the new line under a
BOOT contract with the AustralAsia Railway Corporation. KBR invited the John Holland Group,
Barclay Mowlem, Macmahon Holdings and Australian Railroad Group – all industry leaders – to
join it in forming the Asia Pacific Transport Consortium. Funding was provided by both sponsor
and deliverer under a BOOT structure.
Project managing the design and construction is outlined, including the whole of life approach,
quality, procurement, cost control and industrial relations.
1
BACKGROUND
The 1420-kilometre Alice Springs – Darwin rail
line completes the Adelaide to Darwin Railway,
thereby connecting all mainland states with the
north of Australia and creating a ‘landbridge’ to
Asia. It is a visionary project that will open up trade
opportunities within Australia and overseas, and
foster the development of regional industries.
Asia Pacific Transport, a consortium led by Kellogg
Brown & Root Pty Ltd (KBR), succeeded in
delivering the line ahead of schedule, within budget,
and with excellent safety, industrial relations and
local industry participation records. This success
can be attributed to the consortium’s management
approach, which was characterised by excellent
planning, commitment to innovation, and building
good relations with stakeholders.
The Asia Pacific Transport Consortium delivered the
new rail line under a BOOT (build, own, operate,
transfer) contract with the AustralAsia Railway
*
Invited special focus paper accepted after review
(April 2005)
© Institue of Engineers, Australia 2005
Corporation, which represents the interests of the
Commonwealth, South Australian and Northern
Territory governments. Design and construction of
the railway was contracted by Asia Pacific Transport
to a design and construction joint venture (ADrail),
and was completed in October 2003. Operations
commenced in January 2004. FreightLink, the
consortium’s operating company, will manage rail
services for the first 50 years of the railway’s life.
This includes maintaining and operating the Tarcoola
– Alice Springs line and overseeing port terminal
operations at Darwin’s East Arm Port.
The rail link will enable more efficient transport of
goods between northern and southern Australia,
and by reducing the time it takes for freight to
reach Darwin, shipping to vital Asian markets will
also be more cost-effective. The completed railway
is opening up new opportunities for industries like
mining, agriculture, aquaculture and tourism.
Constructed at a total cost of more than A$1.4 billion,
this is one of the largest infrastructure developments
ever undertaken in Australia. The construction
project required 2 million sleepers (Fig 1), 8 million
sleeper clips, 2.5 million tonnes of ballast (Fig 2), 2800
Australian Journal of Civil Engineering, Vol 2, No 1.
26
“The Alice-Darwin railway: a feat of project management” – Lees
km of rail, 15 million cubic metres of earthworks (Fig
3), 100,000 m of corrugated steel pipe for culverts,
and material for 93 bridges, including crossings of
the Katherine and Elizabeth rivers.
The consortium members did not just have their
reputations at stake, but hundreds of millions of
dollars of their own and their investors’ money. How
Figure 1:
Sleeper handling
Figure 3:
Bulk earthworks
Australian Journal of Civil Engineering
the project was managed was all-important.
Planning began well before the start of the project.
The first step was to assemble the right team, so KBR
invited the John Holland Group, Barclay Mowlem,
Macmahon Holdings and Australian Railroad Group
– all industry leaders – to join it in forming the Asia
Pacific Transport Consortium.
Figure 2:
Ballast transport
Vol 2, No 1.
“The Alice-Darwin railway: a feat of project management” – Lees
2
significantly increased the rate and reliability
of trackworks construction;
PROJECT STRUCTURE AND FINANCING
Successfully completing a project like this took
more than technical expertise, more than the wealth
of experience on large-scale projects that all Asia
Pacific Transport sponsors had. It demanded their
total belief in the future of the railway, as is evidenced
by their willingness to underwrite well over half the
railway’s total cost.
KBR managed the bidding process, led negotiations
and ensured the financial support was in place. KBR
also led the design and construct joint venture, called
ADrail.
Following complex negotiations, the AustralAsia
Railway Corporation and Asia Pacific Transport
entered into a Concession Deed providing the
framework for the design, construction and operation
of the railway. This deed came into force at Financial
Close, which involved 112 different signatories
checking and signing 333 project documents.
•
drew on the sponsors’ collective experience
in the construction of railways in remote
locations, and experience in working with
indigenous communities and maximising local
content and labour – this in turn enabled a
reduced cost structure;
•
negotiated to include the existing railway from
Tarcoola to Alice Springs in the project from
commencement of construction of the new line,
giving the benefit of the operational revenue to
the project finances;
•
structured the rail access code to provide a
commercial framework to the consortium
and its financiers for other competitive access
seekers;
•
gained support from the transport industry;
•
negotiated a Concession Deed with the
AustralAsia Railway Corporation that placed
project and operational risk with the party
best able to manage risk; in this respect the
AustralAsia Railway Corporation accepted
risks associated with land title, legislative
requirements, indigenous matters and other
matters outside the control of the consortium;
The AustralAsia Railway Corporation provided
$480 million of funding. The remainder (about $900
million) was raised by the consortium.
As a PPP project, the Alice–Darwin Railway is
important on several levels. It has:
• allowed government to provide major
civil infrastructure with limited financial
commitment and risk;
•
enabled taxpayers’ funds to be deployed
elsewhere;
•
maximised industry participation;
•
generated private-sector revenue;
•
introduced commercial best practices.
It has also shown the Australian financial community
that deals of this magnitude can be done, and done
extremely well: the Alice–Darwin Railway Project
was named Global Finance’s Asia Pacific Infrastructure
Deal of the Year in 2001 and Euromoney’s PPP Deal
of the Year in 2002.
To help ensure the project’s viability, the
consortium:
• assembled a team with expertise in
operations, rail, logistics, design, construction,
maintenance and project management, with
the ability to self-perform these tasks, thus
reducing the need to use more expensive
methods of subcontracting the works;
•
developed strategies for efficient and speedy
construction of the new railway, incorporating
innovative engineering and construction
solutions and logistics planning that
Australian Journal of Civil Engineering
27
•
maximised the opportunities provided by the
recently completed Port of Darwin, which
has a dedicated freight terminal giving direct
access to the railway. This combination
of infrastructure enabled the consortium
to develop a business plan that combines
domestic business with international trade.
Construction risk was supported by joint and
several completion guarantees from the consortium
members’ parent companies for fixed-time, fixedprice project delivery.
Having regard to the linear construction risk of the
project, liquidated damages were provided for 6%
of the construction contract value. Additionally, the
project sponsors used insurance bonding to provide
additional security support for the government
funding program, particularly over the first
24 months of construction.
2.1 Scheduling
As shown in Table 1, the time from project initiation
to project delivery was a little over six years. This
is a real achievement, considering the challenges of
this greenfield project. The construction schedule
was especially tight – just 30 months. Financial close
was achieved later than expected, which put further
pressure on the schedule.
Vol 2, No 1.
28
“The Alice-Darwin railway: a feat of project management” – Lees
Table 1: Project milestones
November 1997
Submission of expression of interest to tender for the BOOT project.
Approximately 26 EOIs were received by the AustralAsia Railway
Corporation
February 1998
Shortlisting of 3 tenderers
March 1998 to March 1999
Tender submission was prepared in this period including design and
construction; maintenance plans; business plans; financial packaging,
equity, debt and government contribution to the project; traffic forecasts
for domestic and international freight; financial models; company details
in support of consortium make-up, structure and ability to deliver;
concession deed compliance
June 1999
Asia Pacific Transport achieved preferred tenderer status to enable
further negotiations to take place with the AustralAsia Railway
Corporation on key contracts and financial matters
November 1999
The consortium received the mandate from governments to deliver
the project and to go forward to complete the project and financial
documentation, finalise equity and debt provisions and achieve
contractual completion and financial close
April 2001
Financial close was achieved, enabling the design and construction
joint venture to commence construction of the Alice Springs – Darwin
line (and the consortium to take over operation of the existing Tarcoola
– Alice Springs line)
October 2003
Design and construction of the railway and the Darwin port was
completed and handed over to the consortium
January 2004
Accreditation was obtained, commissioning testing of the railway
completed, rolling stock procured, access agreement prescribed to
enable operations to commence
The contractual date for completion of the design and construction works was 30 March 2004 to enable
operations to commence on 1 April 2004. However, there were obvious advantages in commencing operations
early, so the start-up date was moved forward to 15 January 2004. Construction was formally completed on
31 October 2003 with the issue of the Design and Construction Completion Certificate by the Independent
Certifier. Progress and controls are shown in Figures 4, 5, and 6.
2.2 Project management
•
Project Director: KBR
Asia Pacific Transport let the design and construction
contract to ADrail, an unincorporated joint venture
comprising KBR, John Holland, Barclay Mowlem
and Macmahon.
•
Commercial Manager: Barclay Mowlem
•
Design and Construction Manager: John
Holland
•
Design Manager: KBR
All personnel who worked on the design and
construction project were either seconded by the
ADrail partners, or directly employed by ADrail.
The selection criterion for project personnel was best
candidate for the job, regardless of which company
he or she came from. The Project Management
Team, however, was structured to include a senior
representative of each the partners:
Australian Journal of Civil Engineering
• Construction Manager: Macmahon.
The Joint Venture Management Committee comprised
the CEOs of John Holland, Barclay Mowlem and
Macmahon, and KBR’s General Manager, Special
Projects. This structure helped ensure fast and
effective decision making.
Vol 2, No 1.
“The Alice-Darwin railway: a feat of project management” – Lees
Figure 4:
Track laying progress compared to baseline
Figure 5:
Line of Balance construction schedule
Australian Journal of Civil Engineering
29
Vol 2, No 1.
30
“The Alice-Darwin railway: a feat of project management” – Lees
Figure 6:
Example of progress chart
Additionally, each partner was called on to sponsor
aspects of the project for which it had special
expertise. This included:
• KBR: project management, cost control,
procurement, design, environmental
management
3
•
Barclay Mowlem: trackworks (north), major
bridges
3.1 Design achievement
•
Macmahon: earthworks, culverts, minor
bridges
• John Holland: trackworks (south).
One of the keys to the project’s success was the
consortium members’ ability to work effectively with
each other, putting aside their competitive instincts
and focusing on the same goal. Management was
open and transparent.
Initially there were difficulties in distilling the wishes
of individual Management Committee members.
This was overcome by appointing an independent
executive chairman, who was successfully able to
bridge the gap between the Management Committee
and the Project Management Team.
Australian Journal of Civil Engineering
DESIGN AND CONSTRUCTION
As well as good project management, the keys to
meeting the challenges of distance, climate, scale
and budget were simplicity of design and speed of
construction.
The KBR-led design team had a lead-time of just eight
weeks between financial close and the start of field
construction, including time for approvals.
The original scheduling placed various bridges on the
critical path, particularly those at the Katherine River
and the Elizabeth River estuary. The simplicity of the
design so speeded their construction that not only
was this criticality removed, but the program was
shortened. Once the designs were agreed, no changes
to detail of bridges or culverts were requested by field
staff and there were no errors requiring reworking
of documentation.
All design documentation was reviewed by the
Design Working Group, which represented the South
Australian and Northern Territory governments,
Vol 2, No 1.
“The Alice-Darwin railway: a feat of project management” – Lees
Figure 7:
Design and construction progress north from Tennant Creek
AustralAsia Railway Corporation, the banks and
Asia Pacific Transport. Construction was never
held up by lack of design documentation. Design
and construction progress north of Tennant Creek
is shown in Fig 7.
3.2 Whole-of-life approach
From the beginning, the railway was designed with
operations and maintenance as key considerations
in assessing whole-of-life solutions and ensuring
value for money.
• Track design: KBR carried out computer
simulations of train operations in either
direction to confirm optimum operating speeds
related to gradient, locomotive power and
hence fuel economy for all sections of the track;
these were then used to calculate optimum
rail cant (cross slope) to minimise wear and
maintenance. The rail selection was based
on wear considerations; the rail clips were
designed to be removable (with special tools)
for ease of sleeper replacement as necessary.
Soft rail pads were not used because of life and
replacement issues.
•
31
Flood management: by investing in
hydrological analysis, the consortium has
minimised a major risk – flooding and track
wash-aways – thereby substantially reducing
Australian Journal of Civil Engineering
operating and maintenance costs.
•
Access: the consortium negotiated with
AustralAsia Railway Corporation to secure a
nominal 100-metre-wide operating corridor;
this provided access and provisioning during
operation and maintenance.
As part of the process for the design and construction
of the railway, the maintenance and operations parties
were required to sign off on the documentation.
Accordingly, these parties were actively involved
in the review of the construction to ensure that
operational and maintenance parameters were
included in the final product. Again this enabled the
operator and the maintainer to accurately determine
their commitments and ensure that a ‘whole-of-life’
approach to delivery was considered in the design
and construction phase of the project.
3.3 Quality assurance
The consortium’s strategy was to achieve full
certification for the track as it was progressively built,
so that construction traffic could travel at design
speeds in order to support the very tight schedule
and to ensure appropriate rail working safety.
The project quality management system was
established …
Purchase answer to see full
attachment