These days most, if not all, economics mining studies rely on a engineering teams comprised of participants from different consulting firms or from different regional offices of the same firm. This approach gives the opportunity to use specific experts for different aspects of the study.
My recollection is that many years ago larger consulting firms would offer to do an entire study in-house. They would have the in-house team to cover almost the entire study. That approach seems to have changed and now the multi-company path is the norm.
This approach is partly being driven by the clients who wish to use specific consultants they are familiar with and have existing relationships with.
In some instances, larger firms may still make the argument they can take on all of the project scope themselves. However one must reflect on such offers. The danger being a less qualified technical team seconded from offices that are not busy. Possibly you won’t get the best team; you get who is available.
In many multi-company studies, it is not uncommon that few of the team members have ever worked together before. It may be a consultant’s team building exercise right from the start.
I have had both good and bad experiences with these types of engineering teams. Some of them work very well while others floundered. Even when working with different offices of the same firm, things may not go as planned.
The Study Manager is Key
To have a successful mining study team, in my experience the two key factors are;
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The competency of the Study Manager;
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The amount (and style) of team communication.
The Study Manager is vital to keeping everyone working on the same page and ensuring timelines are met. A single team member delaying their deliverables will delay others on the team.
Some consulting firms have multiple projects underway at the same time. Unexpected delays in one study may cause them to shift idle personnel onto other studies. Unfortunately sometimes it is difficult to bring the team back together on the original study at a moment’s notice.
The Study Manager must ensure that everyone understands what their deliverables are. Generally this is done using a “Responsibility Matrix”, but these can sometimes be too general.
Where cost estimation is involved, the Responsibility Matrix should be supported by a Work Breakdown Structure (“WBS”) assigning the costing responsibilities. Given that the contentious parts of many studies are the capital and operating cost estimates, I personally view the WBS equally as important as the Responsibility Matrix.
Team communication is vital and there are different ways to do it. Weekly or bi-weekly conference calls work well but these need to be carefully managed. With a large team on a conference call, there is a fine line between getting too much technical detail versus not enough detail.
On some studies I have seen a weekly call restricted to one-hour long and then everyone flees until next week’s call. At the end of these conference calls, one might have an uneasy feeling of it being incomplete. Perhaps people were not clear on something but hesitated to ask become the one-hour time limit is up. In such cases it is important for the relevant parties to continue on or to have a separate call.
Make it important to speak up
Some PEA’s might be based on a large database of test work and site information while others may rely on very preliminary data and require design projections based on that data.
The sequential PEA approach is a convenient way to continue advancement of the project without making the step to a Pre-Feasibility study or bigger step to a Feasibility study. Maybe the project is still growing in size and a feasibility study at this stage would not be presenting the true potential, hence the updated PEA.
The securities commissions consider that the cautionary language an important component of the PEA Technical Report and may red-flag it if it’s not in all the right places. However this cautionary language is generally focused on the resource.
