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| Coal port capital optimisation |
Context / Scope of project
This port project was well advanced and only six months away from closing bank finance at which point construction will commence. The project costs were considerably higher than the client expected so they engaged PIP initially for a quick, three day workshop to identify ways to improve the overall value of the project.
Client achieved:
- Identified 40 ideas with an initial value of more than $400m through Idea Generation Sessions on an initial $2.0B capital spend
- 10% reduction in construction capital costs
- $180M NPV improvement from schedule improvement
- $50M NPV improvement from operating cost reduction
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What we did:
- Ran structured Idea Generation Workshops to identify specific value enhancing opportunities around capex, opex, schedule improvement and contracting strategy
- Drove and facilitated the documentation, prioritisation and valuation of the generated ideas with the client team members, including installing an idea pipeline management process to enable prioritisation, valuation, verification and execution of all ideas
- Focused detailed effort into several complex ideas to assess their viability and value (e.g. stockyard layout)
- Created clear visibility around what ideas to pursue immediately and what ideas to review in more detail for additional value generation.
- Developed a group understanding of the optimal stockyard layout for the current coal blending requirements generating up to $110 million of potential capital and operating cost improvements
- Outlined a clear, structured path forward for the until financial closure including proposing value generating design changes to the Board
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