The best-laid plans Sometimes project moves run into unexpected problems By Peter A. Buxbaum, AJOT Companies around the world have become adept at planning and executing big infrastructure moves. But sometimes the best laid plans go awry. Take Imperial Oil’s Kearl oil sands project in the Canadian province of Alberta, for example. The company opted for modular construction of the facility that prepares the oil for transport and most of the modules were manufactured nearby. But some of the components—around 20 percent of the total—were contracted to Sungjin Geotec, a manufacturer based in South Korea. The Kearl project has reserves of 4.6 billion barrels and a lifespan of 40 years. The project is expected to produce an initial 110,000 barrels per day when it starts up later this year and eventual production of 345,000 barrels per day. The original plans called for the Korean modules to be transported on the decks of container ships from South Korea to the port of Vancouver, Washington. From there, they were to be offloaded onto barges to make their away over the Columbia and Snake rivers to the port of Lewiston, Idaho. Once snatched from the barges, there they were to be trucked though parts of Idaho and Montana on specialty trailers across the Canadian border to the job site. But the massivity of the modules—some reached higher than 30 feet—precluded them from being transported on interstate highways because they couldn’t fit under overpasses. That meant transporting them on secondary roadways and that’s where Imperial’s plan ran into trouble. Local opposition to the moves delayed permitting, necessitating changes to the plan. All of the modules will get through, and, despite the hassles, the project remains on schedule. It’s just that the logistical twists and turns are going to cost Imperial some money. “The Kearl project is using a high level of modular prefabrication as an approach to construction because of conditions at the Kearl site,” said Pius Rolheiser, a spokesperson for Imperial Oil, a company owned primarily by Exxon Mobil. “We decided it was more efficient from a cost perspective and a safety perspective to maximize modularity and prefabrication.” The modules in question are various types of equipment to be part of the plant where the petroleum is processed for shipment by pipeline. “We sourced more than 80 percent of the components much closer,” said Rolheiser, “but these 205 modules, 20 percent of the total, were specialized pieces of equipment for which we didn’t have a closer competitive source. The company we sourced from, Sungjin Geotec, has a successful track record for manufacturing this type of equipment.” For Sungjin, the project represented an extraordinary opportunity. The $250 million contract was the largest in the company’s history, according to its website. Imperial began developing a transportation plan years in advance. The plan called for the modules to be offloaded in Vancouver, Washington, and the barged to Lewiston, Idaho, by way of the Columbia and Snake inland water systems. “From there, they were to be transported by truck over U.S. Highway 12 through Idaho and the Lowell Pass to Montana and then up through Missoula and north to the Canadian border,” said Rolheiser. “But we encountered significant delays in obtaining permits to transport this equipment on our original proposed route.” U.S. Highway 12 put the shipments through local communities, would have shut down traffic in both directions at times, and would have required a significant commitment from law enforcement. All this required Imperial to come up with a Plan B which would allow the modules to be transported on interstate highways. The contingency plan involved disassembling the modules so that the truck shipments were more compact, allowing them to transit under interstate underpasses. At the same time, the company worked with Sungjin to reconfigure the modules so that they could be more easily disassembled. The plan also abandoned Lewiston in favor of Pasco, Wash