It’s now a well accepted fact that project complexity is growing with Project Owners and Financiers alike seeking greeting certainty over the feasibility of prospective projects.
Major projects now command incredible budgets, when once a $10 billion capital expense was considered extraordinary, it is now no longer, and even more surprising, it can be dwarfed multiple times over by mega-projects all over the globe, with many of the largest based in Australia. Some of the factors that have driven up complexity and costs are diverse, and sometimes debatable, including items like:
- Underlying economic conditions affecting the viability of projects
- Commodity price volatility
- Changes to sovereign stability
- The need for collaboration on projects amongst competitors
But without doubt one such factor is the rising cost and scarcity of labour as competition increases for limited skillsets around the world that also are rapidly ageing. This increases the demand for better productivity from existing resources and vastly improved forecasting of future labour availability and costs for projects at feasibility stages. By their very nature, megaprojects are so big they strain the global supply chain environment which includes the pool of skilled labour. Mega-projects create their own adverse “weather,” pushing up the cost of specialist labour and materials worldwide, making the need for accurate and iterative cost estimations essential.
- Studies (pre-feasibility & feasibility)
- Operations (greenfield and brownfield)