Delays in the delivery of mine projects have become a major concern across all parts of the mining industry. Substantial value is destroyed and companies face significant corporate risk if these delays occur during project execution. However, despite the publicity around mine project delays, there has been limited research conducted classifying delays, assessing their impact on project value and developing mitigation strategies.
Delays can be categorised into discretionary and non-discretionary. Further sub-division of discretionary delays finds strategic (an active decision to delay a project due to market conditions), portfolio sequencing (the decision to pursue other projects instead) and government (interference to gain concessions from the project owner) related sources of delay. Government related delays can be classified within the non-discretionary sector also in both direct (poor or slow bureaucracy) and indirect (the inability to manage competing stakeholders within the country) manners. Other non-discretionary delays stem from equipment sourcing issues (either costs or lead times), human resources (relating to labour or professional skills), financing (in either the debt or equity markets) and ultimately the mineral resource itself (which can be of insufficient scale or quality).
The aim of this research is to review the various causes of delays in mine projects and how they relate to each other. The research will also provide valuable data on realistic development timeframes for projects of different scale; in different commodities; with different types of owner and operating in different geographies. The research will also consider potential delay mitigation strategies and assess the trade off in mine project development between quality, speed and cost.