Dec '13/Jan '14

Controlled build

Labour competition has miners looking at modular construction

By Herb Mathisen

With current and forecasted labour shortages posing potential problems to projects being built in Canada, modular construction is increasing in popularity. In the mining sector, the strategy of building projects in sections at a location with a ready supply of skilled labour and then moving those modules to site for assembly is beginning to make more sense.

“Mining companies are just beginning to explore and understand modular construction,” said Anthony Marino, sponsorship manager for mining, oil and gas with the International Quality & Productivity Center, which organized the inaugural Modular Construction and Prefabrication for Mining conference in Toronto, in October. The company holds large modular construction events that typically focus on improvements to the burgeoning construction trend. But creating an event tailored for miners was a logical choice, since oil and gas companies have been employing modular construction for decades and their projects and issues dominated discussions at previous events. This conference, Marino said, allowed miners to ask general questions about modular construction. Among the roughly 130 attendees were representatives from BHP, Glencore and Rio Tinto, each looking to learn more about the building strategy.

“If we look at mining, it’s something that’s taken off in the last couple of years,” Glen Aitken, senior vice-­president of sales and operations with Mammoet Canada, said in a presentation. Vale’s Long Harbour nickel processing plant in Newfoundland, for instance, was largely built in modules and transported to site in sections as large as 1,200 tonnes.

By using modular construction and prefabrication, mining companies can potentially reduce direct costs associated with conventional on-site construction, called stick builds. These on-site builds see companies paying workers higher wages to lure them away from major centres, as well as covering the indirect costs of flying in, housing and feeding them at a remote site. Thomas Barter, director of construction technologies with WorleyParsons Group, said those indirect costs can outweigh direct costs by a ratio of three to one. “The key is to move the man-hours off your site,” he said.

Proponents say a modular construction strategy can also provide additional cost and schedule certainty, by reducing uncontrollable supply, labour and weather risks that can plague stick builds. Further, they contend that safety is enhanced by moving work into a more structured and controlled setting, and the permitting process can be sped up thanks to reduced environmental, socio-economic and site-dimensional impacts. In a recent SAGD facility construction for Suncor, Fred Haney, the senior director of design engineering, energy and chemicals with Fluor, boasted the company had reduced overall construction costs by around 20 per cent, as it moved more than 65 per cent of the overall worker hours off site.

Over the two-day October event, presenters hammered home lessons learned from past builds. Most important among them was that upfront planning work and costs – mainly associated with increased early design and engineering – are far greater with a modular strategy because there is less tolerance for design changes once building has begun. “There is nothing worse than a badly executed modular project,” said Haney. “It will end up costing you more than a stick build.” He advocates giving modular construction yards 100 per cent of the engineering designs and materials before work commences.

Glencore’s Steven Bowles, project director at the Raglan nickel mine, talked about the company’s recent modular construction experience with a power plant at the northern Quebec operation. “Modularization is the only approach to executing these projects,” he said, pointing to the mine’s remote location. After learning from this experience, Bowles said the company would try to centralize design, procurement and construction to fewer contractors, as it found itself stretched when dealing with multiple yards that were building different plant sections on its very strict shipping schedule. With Raglan planning a future concentrator expansion, Bowles said he was interested in talking with builders and engineers to see what advice they could offer.

Mammoet’s Aitken said getting transportation and logistics companies involved in the early planning stages can eliminate avoidable snags and also inform the design process.

While much discussion related to how many of Alberta’s oil and gas projects were being built in modules and how this expertise could be leveraged for the mining industry’s gain, past experience will only provide some of the answers for modular construction in mining. For one, Alberta benefits from a high-load route, which means easier moves of very large modules from yards in southern Alberta, and even Montana, to operations near Fort McMurray. Such corridors do not exist near many other Canadian mining centres. Also, a great deal of upfront planning and design will have to be applied to mining-specific modules because much of the materials handling and mineral processing equipment does not have oil and gas antecedents.

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