Project Management - Reflections on the Trans-Saharan Mega Project
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AI Summary
This reflective treatise is about the Trans-Saharan Mega Project, a large, far-reaching, and complex project that involves the construction of a gas pipeline from Nigeria all the way to Algeria, from where the pipeline splits and extends into Europe. The treatise discusses the differences between project management and program management, the complexities of mega and complex projects, the challenges of managing multiple stakeholders, and the risks of strategic misrepresentation.
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Project Management – Reflections on the Trans-Saharan Mega
Project
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Introduction
The use of project management methodologies and principles has become popular because
stakeholders seek to gain some benefits such as organizing the project times, minimize or mitigate
risks in such projects using project management tools, develop the skills of teams, and improve cost
benefit resources relationships. All these are aimed at ensuring there is certainty that the goals and
objectives of the project will be achieved within the confines of the projects constraints. However,
these are normally aspects that apply in smaller and/ or simpler projects, for instance, developing a
website or a mobile application. When it comes to mega and complex projects, there are
fundamental differences and this calls for different approaches in the successful management of
such projects, while still applying the key principles and elements of project management. This
reflective treatise is about the Trans-Saharan Mega Project, a large, far reaching, and complex
project that involves the construction of a gas pipeline from from Nigeria all the way to Algeria,
from where the pipeline splits and extends into Europe- one line going into Spain and the other into
Italy. The aim of the project is to diversify the energy and gas sources for Europe.
Project Management and Programme Management in Mega and Complex
Projects/Programmes
There is a fundamental difference between project management and program management: project
management entails managing a single individual project while program management entails
managing multiple projects that can either be similar and/ or related. Usually, a project is a part of a
program, all other the converse is not true. There is a lot at stake about mega projects; they are
usually costly, costing upwards of $ 1 billion and can take several years to complete, and involving
several stakeholders. Various strategies are necessary to ensure effective delivery of such capital
intensive mega projects and these include:
Establishing strong tools for the management of risk as well as governance of the project
Proactive management of stakeholders’ increasing expectations that such projects are
sustainable
Optimizing the available talent that is often scarce through organizational flexibility,
portfolio management, and training
Acceleration of operational readiness
Integration of information systems among players in such projects (Barbero & Redi, 2015).
Mega and complex projects cannot be delivered effectively using traditional project management
principles that have a waterfall Gantt chart, such as having a project initiation, planning, execution,
monitoring, and closure stages. Mega and complex projects, however, require phases such as using
the Hutchinson and Wabeke approach where there are five phases; identification and assessment,
The use of project management methodologies and principles has become popular because
stakeholders seek to gain some benefits such as organizing the project times, minimize or mitigate
risks in such projects using project management tools, develop the skills of teams, and improve cost
benefit resources relationships. All these are aimed at ensuring there is certainty that the goals and
objectives of the project will be achieved within the confines of the projects constraints. However,
these are normally aspects that apply in smaller and/ or simpler projects, for instance, developing a
website or a mobile application. When it comes to mega and complex projects, there are
fundamental differences and this calls for different approaches in the successful management of
such projects, while still applying the key principles and elements of project management. This
reflective treatise is about the Trans-Saharan Mega Project, a large, far reaching, and complex
project that involves the construction of a gas pipeline from from Nigeria all the way to Algeria,
from where the pipeline splits and extends into Europe- one line going into Spain and the other into
Italy. The aim of the project is to diversify the energy and gas sources for Europe.
Project Management and Programme Management in Mega and Complex
Projects/Programmes
There is a fundamental difference between project management and program management: project
management entails managing a single individual project while program management entails
managing multiple projects that can either be similar and/ or related. Usually, a project is a part of a
program, all other the converse is not true. There is a lot at stake about mega projects; they are
usually costly, costing upwards of $ 1 billion and can take several years to complete, and involving
several stakeholders. Various strategies are necessary to ensure effective delivery of such capital
intensive mega projects and these include:
Establishing strong tools for the management of risk as well as governance of the project
Proactive management of stakeholders’ increasing expectations that such projects are
sustainable
Optimizing the available talent that is often scarce through organizational flexibility,
portfolio management, and training
Acceleration of operational readiness
Integration of information systems among players in such projects (Barbero & Redi, 2015).
Mega and complex projects cannot be delivered effectively using traditional project management
principles that have a waterfall Gantt chart, such as having a project initiation, planning, execution,
monitoring, and closure stages. Mega and complex projects, however, require phases such as using
the Hutchinson and Wabeke approach where there are five phases; identification and assessment,
selection, definition, execution, and operation: this was developed for use in the gas and oil industry
and would be suitable for the Trans-Sharan Mega Project (NIGAL). This approach creates value as
the project evolves and classic project management methodologies can be used at the later stages.
Such projects also requires the formation of integrated project teams to oversee the entire project
and serve as its core management team; but the membership of this team evolves as the project
proceeds through the different phases and stages. The owners should be involved in the entire
project and of great importance, is the identification and effective management of stakeholders that
should start before project commencement and continue through the entire phases of the project,
and even after its completion (Parth, 2014). As the NIGAL case shows, there is likely to be hiccups,
such as opposition to the project from diverse stakeholders- in this case, the pipeline faced
opposition for the Nigerian Militant Group Movement for the Emancipation of the Niger Delta on
concerns of not being consulted and not benefiting from such mega projects. Using the right
approach is just half the job done; the biggest challenge is getting stakeholder buy-in and ensuring
their cooperation throughout the entire project, especially in a place like Africa where there are
always concerns of natural resource exploitation without benefits to locals and even adverse
environmental effects that forever change societies and ecosystems. Such projects should be
approached using the systems engineering approach where there are several individual systems that
are interconnected (Tanaka, 2014).
Complex Business, Organizational and Commercial Environment
Complex projects in complex environments have a self-fulfilling aspect that leads to increased
complexity; there is uncertainty in such projects because of of the perceived change and chaos
within the project environment- this in turn leads to reinforced control and planning. With
excessive planning as well as program control comes with it increased complexity and complexity
further causes additional uncertainty, creating a vicious cycle of increased complexity and increased
uncertainty. The high level of control and planning does not decrease complexity; instead in
increases complexity and uncertainty. During planning for such a project as the NIGAL,
technocratic approaches are employed; these ignore the complex interdependencies of multi-nation
and globalized business such that there emerges a huge contrast between the planning of how to go
about the business and the associated experiences of the business. The project environment is the
cause of the patterns that lead to complexity and the vicious cycle where efforts to better plan and
control the project results in elevated uncertainty and complexity, rather than reducing it as intended
(Oehmen et al., 2015). The strong maneuvers to bring control of the project back to the plan when
there is diversion face challenges of how to define what the ‘right track is in an environment that is
increasingly complex and with several stakeholders, amidst changing social, political, and economic
aspects given such projects are multi-year projects. Inevitably, there is a delay in aligning the
and would be suitable for the Trans-Sharan Mega Project (NIGAL). This approach creates value as
the project evolves and classic project management methodologies can be used at the later stages.
Such projects also requires the formation of integrated project teams to oversee the entire project
and serve as its core management team; but the membership of this team evolves as the project
proceeds through the different phases and stages. The owners should be involved in the entire
project and of great importance, is the identification and effective management of stakeholders that
should start before project commencement and continue through the entire phases of the project,
and even after its completion (Parth, 2014). As the NIGAL case shows, there is likely to be hiccups,
such as opposition to the project from diverse stakeholders- in this case, the pipeline faced
opposition for the Nigerian Militant Group Movement for the Emancipation of the Niger Delta on
concerns of not being consulted and not benefiting from such mega projects. Using the right
approach is just half the job done; the biggest challenge is getting stakeholder buy-in and ensuring
their cooperation throughout the entire project, especially in a place like Africa where there are
always concerns of natural resource exploitation without benefits to locals and even adverse
environmental effects that forever change societies and ecosystems. Such projects should be
approached using the systems engineering approach where there are several individual systems that
are interconnected (Tanaka, 2014).
Complex Business, Organizational and Commercial Environment
Complex projects in complex environments have a self-fulfilling aspect that leads to increased
complexity; there is uncertainty in such projects because of of the perceived change and chaos
within the project environment- this in turn leads to reinforced control and planning. With
excessive planning as well as program control comes with it increased complexity and complexity
further causes additional uncertainty, creating a vicious cycle of increased complexity and increased
uncertainty. The high level of control and planning does not decrease complexity; instead in
increases complexity and uncertainty. During planning for such a project as the NIGAL,
technocratic approaches are employed; these ignore the complex interdependencies of multi-nation
and globalized business such that there emerges a huge contrast between the planning of how to go
about the business and the associated experiences of the business. The project environment is the
cause of the patterns that lead to complexity and the vicious cycle where efforts to better plan and
control the project results in elevated uncertainty and complexity, rather than reducing it as intended
(Oehmen et al., 2015). The strong maneuvers to bring control of the project back to the plan when
there is diversion face challenges of how to define what the ‘right track is in an environment that is
increasingly complex and with several stakeholders, amidst changing social, political, and economic
aspects given such projects are multi-year projects. Inevitably, there is a delay in aligning the
desired program scope with requirements of the market and this usually results in attempts at ‘quick
fixes’, the unintended consequences of such an approach being even greater uncertainty and
complexity because of unpredictable reactions in the environment; a government can change in one
country that changes their support for the project from the previous government ; in Africa, such
changes can be extreme given the unstable political systems and weak government controls that
often lead to new rebel or opposition/ militant groups arising. The complexities and unintended
consequences are a result of strict planning and control having their effects being delayed that due
to the business and project environment, trigger more quick fixes that add to the problem rather than
minimize them as depicted in the image below;
Solving such issues and the vicious cycle is indeed no easy task, but a collaborative approach
involving the stakeholders in which existing planning and control strategies are reviewed
periodically and the underlying assumptions identified and tackled through a sense-making process
can help. The planning should be interactive s that strategies are developed to close gaps between
what can happen and what the project team intends to happen. This also calls for continuous project
scope alignment and adaptation from internal learning processes in different phases that enable
teams flexible self organization. A systems thinking approach will also help ensure the project
fixes’, the unintended consequences of such an approach being even greater uncertainty and
complexity because of unpredictable reactions in the environment; a government can change in one
country that changes their support for the project from the previous government ; in Africa, such
changes can be extreme given the unstable political systems and weak government controls that
often lead to new rebel or opposition/ militant groups arising. The complexities and unintended
consequences are a result of strict planning and control having their effects being delayed that due
to the business and project environment, trigger more quick fixes that add to the problem rather than
minimize them as depicted in the image below;
Solving such issues and the vicious cycle is indeed no easy task, but a collaborative approach
involving the stakeholders in which existing planning and control strategies are reviewed
periodically and the underlying assumptions identified and tackled through a sense-making process
can help. The planning should be interactive s that strategies are developed to close gaps between
what can happen and what the project team intends to happen. This also calls for continuous project
scope alignment and adaptation from internal learning processes in different phases that enable
teams flexible self organization. A systems thinking approach will also help ensure the project
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objectives are achieved by understanding that different aspects of the project are interrelated and
affect each other ; systems thinking is an antidote for complexity as it enables strategic alignment
with external and internal changes and enhances innovation to solve problems of uncertainty and
complexity.
Multiple Stakeholders priorities and complexities – dealing with Government and
Private Entities
The NIGAL project passes through three nations (Nigeria, Niger, and Algeria), all with different
social and political systems, affecting numerous communities on its way to Europe and this implies
multiple stakeholders along the way, from environmentalists,local communities, resistance groups
(as in the case of Nigeria), politicians, local and national governments, environmental groups, and
the private sector that are owners of the project. Private entities are in in the project for commercial
and business purposes; for instance to generate profits while public stakeholders such as
governments and communities are in it for the bigger society-wide benefits; for example, for
European countries, the project is aimed at diversifying her energy sources, given it is a large
consumer of energy. Projects are deemed successful when its objectives are met and it either meets
of exceeds stakeholder expectations: for simple projects like developing a website, there are a few
stakeholders, but in complex and mega projects like NIGAL, there are multiple stakeholders both in
the private and public sector, and includes the society as a whole. The NUGAL project has major
stakeholders being the private sector, including the operators NNPC and Sonatrach that is a
company that would also include Niger Republic, a public institution (a government really), with
the former holding 90% shareholding while Niger would hold 10%. In the project, Russian energy
player Gazprom held negotiations with Nigeria on getting some shareholding, as well as Indian
company GAIL and Total of France, ENI of Italy, Royal Dutch Shell expressing interest in
participating in the project. However, the Algerian Minister for Energy stated that only parters
‘who can bring something’ to the project can participate, in which case ‘something’ excludes just
money. Further the governments of Nigeria and Algeria have made their position clear that ‘if things
proceed well’, there would be no need for bringing international private sector players such as the
interested companies. There are other informal’ stakeholders, such as communities, and militant
groups that greatly hampers the desired objectives of the NIGAL; Nigeria s the fourth largest oil
and LPG producer in the world and the largest in Africa, but its production is greatly hampered by
instability and disruptions to supply, while the natural gas sector faces challenges of restricted
infrastructure to monetize gas that at present, is burned off (flared)- wasted and it flares off the
second largest amount of natural gas only after Russia. Yet the government does not welcome
companies with experience and knowhow in such situations to at least build the infrastructure and
affect each other ; systems thinking is an antidote for complexity as it enables strategic alignment
with external and internal changes and enhances innovation to solve problems of uncertainty and
complexity.
Multiple Stakeholders priorities and complexities – dealing with Government and
Private Entities
The NIGAL project passes through three nations (Nigeria, Niger, and Algeria), all with different
social and political systems, affecting numerous communities on its way to Europe and this implies
multiple stakeholders along the way, from environmentalists,local communities, resistance groups
(as in the case of Nigeria), politicians, local and national governments, environmental groups, and
the private sector that are owners of the project. Private entities are in in the project for commercial
and business purposes; for instance to generate profits while public stakeholders such as
governments and communities are in it for the bigger society-wide benefits; for example, for
European countries, the project is aimed at diversifying her energy sources, given it is a large
consumer of energy. Projects are deemed successful when its objectives are met and it either meets
of exceeds stakeholder expectations: for simple projects like developing a website, there are a few
stakeholders, but in complex and mega projects like NIGAL, there are multiple stakeholders both in
the private and public sector, and includes the society as a whole. The NUGAL project has major
stakeholders being the private sector, including the operators NNPC and Sonatrach that is a
company that would also include Niger Republic, a public institution (a government really), with
the former holding 90% shareholding while Niger would hold 10%. In the project, Russian energy
player Gazprom held negotiations with Nigeria on getting some shareholding, as well as Indian
company GAIL and Total of France, ENI of Italy, Royal Dutch Shell expressing interest in
participating in the project. However, the Algerian Minister for Energy stated that only parters
‘who can bring something’ to the project can participate, in which case ‘something’ excludes just
money. Further the governments of Nigeria and Algeria have made their position clear that ‘if things
proceed well’, there would be no need for bringing international private sector players such as the
interested companies. There are other informal’ stakeholders, such as communities, and militant
groups that greatly hampers the desired objectives of the NIGAL; Nigeria s the fourth largest oil
and LPG producer in the world and the largest in Africa, but its production is greatly hampered by
instability and disruptions to supply, while the natural gas sector faces challenges of restricted
infrastructure to monetize gas that at present, is burned off (flared)- wasted and it flares off the
second largest amount of natural gas only after Russia. Yet the government does not welcome
companies with experience and knowhow in such situations to at least build the infrastructure and
operate the gas fields. As such, undertaking such a project requires innovative approaches to
manage stakeholders like governments with legal agreements, such as public private partnerships
and concessions to operate such facilities and resources t gain maximum returns for all
stakeholders.
Optimum Bias
Such mega and complex projects as the NIGAL can have potentially huge benefits to all people and
stakeholders; it would provide a quick means to deliver oil thousands of kilometers to Europe where
there is a ready market, it would help improve economies of source countries through better prices
and foreign exchange, provide Europe with an energy source alternative to Russia, create jobs, and
lead to infrastructure development and reduced resource wastes as happens with the Nigerian
natural gas flaring. This is an aspect termed optimism bias, an inclination by stakeholders and
people to think overly positively when predicting the outcomes from future planned projects or
actions. It is a considerable challenge when planning and delivering projects, public services,
especially mega projects such as infrastructure or those involving infrastructure. Preparing and
developing an achievable baseline project schedule and therefore, set the project up for success
instead of failure still remains a major project challenge. Optimism bias is a major cause for
unrealistic project scheduling and this in itself results in project failure as well as other complex
problems in the project environment. In the project, it is seen when the Nigeria and Algeria
governments say that ‘if things go well’ then there will be no need for multinationals being involved
in the project . There in conjecture about its effects on projects; it results in unrealistic expectations
including unrealistic base schedules which technically mean projects are more likely to fail or not
achieve their objectives, especially with the vicious cycle of strict control and planning and project
complexity where knee-jerk reactions case further uncertainty. The intentions of the project further
confirm the effects of optimism bias; to have an alternative energy source for Europe, a very
simplistic but novel thought, yet the complexity and risks involved in doing so, especially where the
African continent is involved is a miscalculation. However, optimism bias can be solved / overcome
using novel approaches such as the Flyybjerg ‘Reference Class’ approach which is based on the
‘Outside View’ principle developed by Kahneman and it works based on the use of an independent
third party to review the objectives of a project and its estimates, especially budgeting. The
Nigerian government under Goodluck Jonathan fully backed the project that is estimated to cost $
20 billion as it would transport 30 billion cubic meters of natural gas from the Nigerian Warri region
to Europe through Niger and Algeria. However, the project has a stumbling block in terms of cost
which the major shareholders would struggle to raise, given their refusal to have global energy
firms with ‘deep pockets’ such as Shell and Gazprom become shareholders and inject money; the
Algerian Energy Minister even asserted that partners whose only contribution was money were not
manage stakeholders like governments with legal agreements, such as public private partnerships
and concessions to operate such facilities and resources t gain maximum returns for all
stakeholders.
Optimum Bias
Such mega and complex projects as the NIGAL can have potentially huge benefits to all people and
stakeholders; it would provide a quick means to deliver oil thousands of kilometers to Europe where
there is a ready market, it would help improve economies of source countries through better prices
and foreign exchange, provide Europe with an energy source alternative to Russia, create jobs, and
lead to infrastructure development and reduced resource wastes as happens with the Nigerian
natural gas flaring. This is an aspect termed optimism bias, an inclination by stakeholders and
people to think overly positively when predicting the outcomes from future planned projects or
actions. It is a considerable challenge when planning and delivering projects, public services,
especially mega projects such as infrastructure or those involving infrastructure. Preparing and
developing an achievable baseline project schedule and therefore, set the project up for success
instead of failure still remains a major project challenge. Optimism bias is a major cause for
unrealistic project scheduling and this in itself results in project failure as well as other complex
problems in the project environment. In the project, it is seen when the Nigeria and Algeria
governments say that ‘if things go well’ then there will be no need for multinationals being involved
in the project . There in conjecture about its effects on projects; it results in unrealistic expectations
including unrealistic base schedules which technically mean projects are more likely to fail or not
achieve their objectives, especially with the vicious cycle of strict control and planning and project
complexity where knee-jerk reactions case further uncertainty. The intentions of the project further
confirm the effects of optimism bias; to have an alternative energy source for Europe, a very
simplistic but novel thought, yet the complexity and risks involved in doing so, especially where the
African continent is involved is a miscalculation. However, optimism bias can be solved / overcome
using novel approaches such as the Flyybjerg ‘Reference Class’ approach which is based on the
‘Outside View’ principle developed by Kahneman and it works based on the use of an independent
third party to review the objectives of a project and its estimates, especially budgeting. The
Nigerian government under Goodluck Jonathan fully backed the project that is estimated to cost $
20 billion as it would transport 30 billion cubic meters of natural gas from the Nigerian Warri region
to Europe through Niger and Algeria. However, the project has a stumbling block in terms of cost
which the major shareholders would struggle to raise, given their refusal to have global energy
firms with ‘deep pockets’ such as Shell and Gazprom become shareholders and inject money; the
Algerian Energy Minister even asserted that partners whose only contribution was money were not
welcome into the project, yet with all the support and commitment to the project, raising the
requisite $ 20 billion proved a challenge s shown by President Goodluck saying the Nigerian
Government, the major stakeholder, would contribute $ 450 million and would add another $ 250
million from a Eurobond.
Strategic Misrepresentation of the inherent benefit and value of this Mega Project
To market projects and gain stakeholder support and acceptance, projects and their value are often
misrepresented in a strategic way in terms of cost, value, feasibility, and ability to be achieved. This
misrepresentation proceeds from optimism bias as well; the NIGAL project will cover 4128 km,
making it the single longest pipeline in the world and is projected to carry 30 billion cubic meters of
natural gas from Nigeria which will significantly curb flared gas. It also enables Europe to tap into
Nigeria’s 5 trillion cubic meters of gas reserves, makes Algeria an important energy hub and in
short, makes everyone happy. Except that these rosy presentations are deceptive; the risks are far
too many; despite the feasibility study undertaken by IPA Energy Consulting and Penspen in 2006
that sad the project was economically and technically feasible, it comes with too many risks and
doubts about its viability on its realization. Such mega and complex projects as the NIGAL are
characterized by high inherent risks due to long horizons for planning and complex interfaces,there
are not characterized by standard technology, planning and decision making is usually multi-
sectoral involving several stakeholders with conflicting interests. The projects usually also have
significant changes to ambition level and scope throughout its implementation period and based on
statistical evidence, such projects have too many events that are unplanned for, meaning the
contingency budgets are unable to cover incidents. Consequently, there is misinformation
concerning its actual costs, risks, and benefits and this is the norm with projects such as the NIGAL.
As a result, such projects end up having huge cost overruns, as well as benefits shortfalls, far from
what was envisaged and marketed (Morris, Pinto and Söderlund, 2016). apart from being the
longest pipeline in the world, most construction will occur in among the most difficult
environments in the world, the Sahara desert and inevitably, costs will rise significantly. The
development of the Nigerian LPG (liquefied natural gas) sector would be more efficient and viable
for export than the natural gas proposition. The NIGAL project is a very speculative project and
finding private partners to foot the estimated $ 20 billion needed for its completion will not be easy
as just a single major incident, like terrorism, political instability, or war can halt construction. The
countries where the pipeline will run are very unstable ad are under constant threat of terror and
insecurity; among the least insecure area in the world are Niger, Nigeria, and Algeria due to several
guerrilla movements as well as terrorist organizations that are a constant threat of destabilization
(Fabiani, 2009).
Complexities in Phase by Phase Management – Whole Life Cycle Approach
requisite $ 20 billion proved a challenge s shown by President Goodluck saying the Nigerian
Government, the major stakeholder, would contribute $ 450 million and would add another $ 250
million from a Eurobond.
Strategic Misrepresentation of the inherent benefit and value of this Mega Project
To market projects and gain stakeholder support and acceptance, projects and their value are often
misrepresented in a strategic way in terms of cost, value, feasibility, and ability to be achieved. This
misrepresentation proceeds from optimism bias as well; the NIGAL project will cover 4128 km,
making it the single longest pipeline in the world and is projected to carry 30 billion cubic meters of
natural gas from Nigeria which will significantly curb flared gas. It also enables Europe to tap into
Nigeria’s 5 trillion cubic meters of gas reserves, makes Algeria an important energy hub and in
short, makes everyone happy. Except that these rosy presentations are deceptive; the risks are far
too many; despite the feasibility study undertaken by IPA Energy Consulting and Penspen in 2006
that sad the project was economically and technically feasible, it comes with too many risks and
doubts about its viability on its realization. Such mega and complex projects as the NIGAL are
characterized by high inherent risks due to long horizons for planning and complex interfaces,there
are not characterized by standard technology, planning and decision making is usually multi-
sectoral involving several stakeholders with conflicting interests. The projects usually also have
significant changes to ambition level and scope throughout its implementation period and based on
statistical evidence, such projects have too many events that are unplanned for, meaning the
contingency budgets are unable to cover incidents. Consequently, there is misinformation
concerning its actual costs, risks, and benefits and this is the norm with projects such as the NIGAL.
As a result, such projects end up having huge cost overruns, as well as benefits shortfalls, far from
what was envisaged and marketed (Morris, Pinto and Söderlund, 2016). apart from being the
longest pipeline in the world, most construction will occur in among the most difficult
environments in the world, the Sahara desert and inevitably, costs will rise significantly. The
development of the Nigerian LPG (liquefied natural gas) sector would be more efficient and viable
for export than the natural gas proposition. The NIGAL project is a very speculative project and
finding private partners to foot the estimated $ 20 billion needed for its completion will not be easy
as just a single major incident, like terrorism, political instability, or war can halt construction. The
countries where the pipeline will run are very unstable ad are under constant threat of terror and
insecurity; among the least insecure area in the world are Niger, Nigeria, and Algeria due to several
guerrilla movements as well as terrorist organizations that are a constant threat of destabilization
(Fabiani, 2009).
Complexities in Phase by Phase Management – Whole Life Cycle Approach
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According to the Project management Institute, the best approach to managing mega and complex
projects involves the phase by phase whole life cycle approach, yet while this is an improvement on
the traditional waterfall approach to managing projects, it is by no means the panacea to complexity
and uncertainty in mega and complex projects. It still has some significant challenges. In the field
of project management, complex mega projects are like the wild beasts, difficult to tame, are highly
complex, have vast sizes, long time frames, and high costs. Such projects as the NIGAL result in
huge changes in the geography of the places and countries they are implemented in, as well as in
people’s lives (Zidane, Johansen and Ekambaram, 2013). One of the reasons for using the whole
life cycle approach for mega projects is the ability to break it into phases, but this is also one of its
inherent limitations and challenges, it is unrealistic to break a mega complex project into discrete
stages/ phases. But while this can work for some projects, it is not adaptable to mega projects where
there is a high level of uncertainty and the NIGAL project: it is more suited to traditional projects
that have requirements that are well defined and which are not affected by so many variables as the
NIGAL project, or which have a multi year implementation plan. By its nature, this approach also
increases costs because every phase requires a detailed review; imagine reviewing the performance
of a phase involving the construction of 1200 km of pipeline over a desert! It also results in
increased complexity or making the project look more complex as it has several activities, steps,
and phases that must be followed and rigid approaches can result in stressful environments. The use
of the whole life-cycle approach can stifle creativity since early everything required is set; the
processes, steps, and activities to be done. Having to meet set deadlines, working in a stressful
environment where activities have been pre-defined and fixed procedures can further stifle
creativity (Adhikari, 2018).
Supply Chain Management (Strategic Procurement and Strategic Purchasing)
Such mega projects that are complex require strategic procurement and sourcing; strategic sourcing
refers to an institutional process of procurement that is characterized by continuous improvements
through the evaluation and re-evaluation of purchasing activities of the organization and is an
integral component of supply chain management. Strategic procurement is a form of strategic
planning, contract negotiation, supplier development, outsourcing models, and supply chain
infrastructure. For a mega project such as the NIGAL, Supply Chain Management (SCM) will
requires a strategic sourcing plan which is a consequence of exhaustive planning planning efforts
put into strategic sourcing. All events dealing with sourcing should be detailed and organized into
operational and tactical information with the sourcing teas responsible for every phase or event
clearly defined, the time when sourcing is to be done (with start and finish); and these should be
based on the RFX steps of Requests for Information (RFI), Requests for Proposals (RFP), and
Requests for Quotations (RFQ). Further, it should entail all specifications, requirements, and cost
projects involves the phase by phase whole life cycle approach, yet while this is an improvement on
the traditional waterfall approach to managing projects, it is by no means the panacea to complexity
and uncertainty in mega and complex projects. It still has some significant challenges. In the field
of project management, complex mega projects are like the wild beasts, difficult to tame, are highly
complex, have vast sizes, long time frames, and high costs. Such projects as the NIGAL result in
huge changes in the geography of the places and countries they are implemented in, as well as in
people’s lives (Zidane, Johansen and Ekambaram, 2013). One of the reasons for using the whole
life cycle approach for mega projects is the ability to break it into phases, but this is also one of its
inherent limitations and challenges, it is unrealistic to break a mega complex project into discrete
stages/ phases. But while this can work for some projects, it is not adaptable to mega projects where
there is a high level of uncertainty and the NIGAL project: it is more suited to traditional projects
that have requirements that are well defined and which are not affected by so many variables as the
NIGAL project, or which have a multi year implementation plan. By its nature, this approach also
increases costs because every phase requires a detailed review; imagine reviewing the performance
of a phase involving the construction of 1200 km of pipeline over a desert! It also results in
increased complexity or making the project look more complex as it has several activities, steps,
and phases that must be followed and rigid approaches can result in stressful environments. The use
of the whole life-cycle approach can stifle creativity since early everything required is set; the
processes, steps, and activities to be done. Having to meet set deadlines, working in a stressful
environment where activities have been pre-defined and fixed procedures can further stifle
creativity (Adhikari, 2018).
Supply Chain Management (Strategic Procurement and Strategic Purchasing)
Such mega projects that are complex require strategic procurement and sourcing; strategic sourcing
refers to an institutional process of procurement that is characterized by continuous improvements
through the evaluation and re-evaluation of purchasing activities of the organization and is an
integral component of supply chain management. Strategic procurement is a form of strategic
planning, contract negotiation, supplier development, outsourcing models, and supply chain
infrastructure. For a mega project such as the NIGAL, Supply Chain Management (SCM) will
requires a strategic sourcing plan which is a consequence of exhaustive planning planning efforts
put into strategic sourcing. All events dealing with sourcing should be detailed and organized into
operational and tactical information with the sourcing teas responsible for every phase or event
clearly defined, the time when sourcing is to be done (with start and finish); and these should be
based on the RFX steps of Requests for Information (RFI), Requests for Proposals (RFP), and
Requests for Quotations (RFQ). Further, it should entail all specifications, requirements, and cost
goals/ negotiations with the objective of managing the quality and timing of all sourcing events
within the strategic sourcing plan. This should be followed by, or incorporate sourcing optimization
using approaches such as operations research to enable simultaneous evaluation of several different
strategic procurement inputs taking into consideration specific conditions in the present supply
chain, the global market, and conditions of individual suppliers as well as alternative offers to
address the strategic sourcing goals. Collaborative sourcing should also be used where different
organizations/ teams collaborate in negotiations. For the NIGAL project, this would require
collaboration by the different stakeholders to cooperate as they are involved in a single mega
project. The mega project should utilize a sourcing business model which is a systems based
approach to SCM for structuring relationships with suppliers where one party must work with
another to achieve success (North Carolina State University, 2019). For example, in the NIGAL, a
pipe supplier must work with a valve manufacturer to supply the required pipes and valves at the
right locations and at the right time. The models include vested sourcing, performance based or
managed services model, shared services model, basic provider, equity partnership model, preferred
and approved provider models. No single one is best for all strategic SCM for the project, but the
most suitable can be used depending on the type of product or service to be procured and its
requirement location and cost. Procurement in mega and complex projects is critical in the context
of cost and future ripple effects because vendor problems can lead to the need for re-design
reconstruction, and Re-procurement that further raise costs and lead to delays; the fuzzy TOPSIS
(technique for order preference by similarity to ideal solution ) approach that uses multiple criteria
is best suited for primary vendors selection in mega and complex projects (Jang et al., 2017).
Strategic Risk Management
One of the biggest challenges to undertaking the NIGAL project is the risks inherent to its
execution; unlike simple projects, the risks to such a project are many, interlinked, and difficult to
categorize because new risks can come up and for some risks, their consequences can be a halt to
project execution. One of the important aspects of managing risks in mega projects is risk
systematization through accurate identification and characterization as well as classification/
categorization. This then leads to an evaluation and quantification of the risks to determine what
risks are affordable and which are not affordable. Mega projects are susceptible to several risk
categories, including general, design, political/ legal, contractual, construction, labor, operation,
financial/ economic, society/ clients, and force majeure risks (Irimia-Diéguez, Sanchez-Cazorla and
Alfalla-Luque, 2014). The risks should then be prioritized, such as using technical approaches like
risk prioritization matrices or analytical hierarchical processes for characterizing and categorizing
risks (Badri, Nadeau and Gbodossou, 2012; Qazi et al., 2016)
Governance
within the strategic sourcing plan. This should be followed by, or incorporate sourcing optimization
using approaches such as operations research to enable simultaneous evaluation of several different
strategic procurement inputs taking into consideration specific conditions in the present supply
chain, the global market, and conditions of individual suppliers as well as alternative offers to
address the strategic sourcing goals. Collaborative sourcing should also be used where different
organizations/ teams collaborate in negotiations. For the NIGAL project, this would require
collaboration by the different stakeholders to cooperate as they are involved in a single mega
project. The mega project should utilize a sourcing business model which is a systems based
approach to SCM for structuring relationships with suppliers where one party must work with
another to achieve success (North Carolina State University, 2019). For example, in the NIGAL, a
pipe supplier must work with a valve manufacturer to supply the required pipes and valves at the
right locations and at the right time. The models include vested sourcing, performance based or
managed services model, shared services model, basic provider, equity partnership model, preferred
and approved provider models. No single one is best for all strategic SCM for the project, but the
most suitable can be used depending on the type of product or service to be procured and its
requirement location and cost. Procurement in mega and complex projects is critical in the context
of cost and future ripple effects because vendor problems can lead to the need for re-design
reconstruction, and Re-procurement that further raise costs and lead to delays; the fuzzy TOPSIS
(technique for order preference by similarity to ideal solution ) approach that uses multiple criteria
is best suited for primary vendors selection in mega and complex projects (Jang et al., 2017).
Strategic Risk Management
One of the biggest challenges to undertaking the NIGAL project is the risks inherent to its
execution; unlike simple projects, the risks to such a project are many, interlinked, and difficult to
categorize because new risks can come up and for some risks, their consequences can be a halt to
project execution. One of the important aspects of managing risks in mega projects is risk
systematization through accurate identification and characterization as well as classification/
categorization. This then leads to an evaluation and quantification of the risks to determine what
risks are affordable and which are not affordable. Mega projects are susceptible to several risk
categories, including general, design, political/ legal, contractual, construction, labor, operation,
financial/ economic, society/ clients, and force majeure risks (Irimia-Diéguez, Sanchez-Cazorla and
Alfalla-Luque, 2014). The risks should then be prioritized, such as using technical approaches like
risk prioritization matrices or analytical hierarchical processes for characterizing and categorizing
risks (Badri, Nadeau and Gbodossou, 2012; Qazi et al., 2016)
Governance
Such projects as the NIGAL require effective approaches in terms of project governance; based on
research, the proposed governance approach should entail active participation of the headquarter/
main project office and three coordination platforms that include the design platform, the
construction platforms, and the schedule platform in order to achieve project success. The
governance work and the management work must be well aligned if the project is to achieve its
objectives. The proposed framework takes into consideration internal as well as external dynamics,
the involvement of government in this project, information management and flows, and the
involvement of the private sector as well as the key areas of design, construction, and schedule.
The proposed framework, based on the work of Jia, Chen, Jing Wong and Zhang (2013) is depicted
in the image below;
Cost/Time Control Practices
research, the proposed governance approach should entail active participation of the headquarter/
main project office and three coordination platforms that include the design platform, the
construction platforms, and the schedule platform in order to achieve project success. The
governance work and the management work must be well aligned if the project is to achieve its
objectives. The proposed framework takes into consideration internal as well as external dynamics,
the involvement of government in this project, information management and flows, and the
involvement of the private sector as well as the key areas of design, construction, and schedule.
The proposed framework, based on the work of Jia, Chen, Jing Wong and Zhang (2013) is depicted
in the image below;
Cost/Time Control Practices
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Mega projects such as the NIGAL have long drawn out implementation periods and are always at
risk of time and cost overruns, especially if any of the risks such as political instability of problems
with procurement and design come into play. Research shows that on average, 44% of mega
projects experience cost overruns and this is higher than that experienced in general projects,
showing a higher risk of cost overruns in mega projects. Mega projects face lower efficacy metrics
in cost control than for general projects. The costs in mega projects can be controlled using a
systems approach to cost, starting with the planning, budgeting, and SCM phases. In addition, tools
such as use of the S-curve, using cost control software applications, forecasting techniques, and
having a cost baseline based on the WBS (work breakdown structure) are effective in mega and
complex projects cost controls. These tools, according to research, are more frequently used in
mega projects than they are used in general projects (Hwang et al., 2018).
Change Management
The complex nature of mega projects mean that any changes can have far reaching impacts on other
seemingly unrelated areas or sections of the project. The change management in mega projects must
consider the entire project life-cycle and use a systems approach in managing change such as by
having a pending items approach where every perceived or proposed change is documented in a
pending items list. This list is the reviewed by the project governance and management teams
periodically in order to identify the pending items in the list tat are prospective claims. The prime
contracts management division processes these claims ans submitted to a review team made up of
engineers to determine their viability. This approach has been used successfully by the Omani
government in a mega construction project. In addition to this approach, for the NIGAL project, the
PMBOK guidelines should also be used, and involve an integrated change control approach where
tools such as Building Information Modeling (BIM) are used to determine how changes in one
aspect will affect other aspects. The integrated change process must run from project inception until
completion and the project manager(s) have the ultimate responsibility for this. The project scope
statement, project/ program management plan, and other deliverables must be carefully and strictly
controlled and maintained in a continuous manner with changes managed either through acceptance
or rejection after a careful analysis and approvals (Nayar, 2014).
Lessons Learnt and Lessons yet to be Learnt
That mega projects have some unique challenges that set them apart from genera projects; although
the project management principles used in general projects still apply in mega projects, their use
and implementation is different. The concept of optimism bias is an interesting and new aspect
learned in this study that has given the author new insights and another unique reason why mega
projects experience problems/ and or fail. New concepts have been ;earned with respect to
managing mega projects, including new frameworks for project governance, strategic procurement
risk of time and cost overruns, especially if any of the risks such as political instability of problems
with procurement and design come into play. Research shows that on average, 44% of mega
projects experience cost overruns and this is higher than that experienced in general projects,
showing a higher risk of cost overruns in mega projects. Mega projects face lower efficacy metrics
in cost control than for general projects. The costs in mega projects can be controlled using a
systems approach to cost, starting with the planning, budgeting, and SCM phases. In addition, tools
such as use of the S-curve, using cost control software applications, forecasting techniques, and
having a cost baseline based on the WBS (work breakdown structure) are effective in mega and
complex projects cost controls. These tools, according to research, are more frequently used in
mega projects than they are used in general projects (Hwang et al., 2018).
Change Management
The complex nature of mega projects mean that any changes can have far reaching impacts on other
seemingly unrelated areas or sections of the project. The change management in mega projects must
consider the entire project life-cycle and use a systems approach in managing change such as by
having a pending items approach where every perceived or proposed change is documented in a
pending items list. This list is the reviewed by the project governance and management teams
periodically in order to identify the pending items in the list tat are prospective claims. The prime
contracts management division processes these claims ans submitted to a review team made up of
engineers to determine their viability. This approach has been used successfully by the Omani
government in a mega construction project. In addition to this approach, for the NIGAL project, the
PMBOK guidelines should also be used, and involve an integrated change control approach where
tools such as Building Information Modeling (BIM) are used to determine how changes in one
aspect will affect other aspects. The integrated change process must run from project inception until
completion and the project manager(s) have the ultimate responsibility for this. The project scope
statement, project/ program management plan, and other deliverables must be carefully and strictly
controlled and maintained in a continuous manner with changes managed either through acceptance
or rejection after a careful analysis and approvals (Nayar, 2014).
Lessons Learnt and Lessons yet to be Learnt
That mega projects have some unique challenges that set them apart from genera projects; although
the project management principles used in general projects still apply in mega projects, their use
and implementation is different. The concept of optimism bias is an interesting and new aspect
learned in this study that has given the author new insights and another unique reason why mega
projects experience problems/ and or fail. New concepts have been ;earned with respect to
managing mega projects, including new frameworks for project governance, strategic procurement
ad SCM, and risk management. Another lesson is the use of phases and while cycle approach to
managing mega projects and how this differs from general projects; as well another lesson learned
is the use of systems thinking in managing risks in mega projects and the novel framework for mega
projects governance. The author has also learned an analytical approach to strategic SCM
management and ho to manage stakeholders. Lessons yet to be learned include how budgeting is
done to come to a figure of what the entire project would cost; for example, it was estimated at
between $ 12 billion and $ 20 billion; on what basis are such figures generated? Even if generated
form RFPs, does it take into consideration factors such as inflation in the future? Another lesson yet
to be learned is if concepts such as net Present value and Internal rates of Return can be applied in
evaluating mega projects such as the NIGAL, would it provide a useful basis for decision making?
Finally, yet to be learned is how funding for such a project can best be sourced and what are the
implications of these to the entire usable life cycle of the project as well as its valuation based on
NPV and IRR.
Gaps Analysis
The aspects yet to be learned, such as how the entire project cost is generated requires further in
depth approaches and practical case studies. The author is particularly keen on how the such
projects are budgeted for, and how to get supplier collaboration to achieve objectives, including
timely delivery. This is motivated by the Boeing cases where deliveries for aircraft were delayed
due to SCM problems despite all the detailed planning. Another gap is just what needs to be done to
ensure mega projects are delivered on time and objectives met, given that most mega projects
experience overruns and the proposed phased management approach also has limitations with
rigidity. These gaps can be filled through detailed case studies of past of hypothetical projects
involving advanced level simulations to enhance learning and improve practical knowledge as
suggested by (Boateng, Chen and Ogunlana (2017).
Benefits and Value Management
Value has moved away from ‘value management’ ideas to ideas that involve ‘understanding the way
stakeholders value various different things’. In the context of mega projects and following this new
paradigm, value is influenced by the complex morass of involved stakeholders which includes both
internal and external stakeholders. For the internal stakeholders, value of concern is the value that
comes from the deployment of project management while for the external stakeholders, value
emanates from project outcome values, for instance, in the NIGAL project,, external stakeholders
such as European governments would view value as an extra source of natural gas source to provide
an alternative to Russia and Algeria, the present sources. The value framework illustrated below is
prosed for managing value in mega projects based on the work of Oliomogbe and Smith (2012)
managing mega projects and how this differs from general projects; as well another lesson learned
is the use of systems thinking in managing risks in mega projects and the novel framework for mega
projects governance. The author has also learned an analytical approach to strategic SCM
management and ho to manage stakeholders. Lessons yet to be learned include how budgeting is
done to come to a figure of what the entire project would cost; for example, it was estimated at
between $ 12 billion and $ 20 billion; on what basis are such figures generated? Even if generated
form RFPs, does it take into consideration factors such as inflation in the future? Another lesson yet
to be learned is if concepts such as net Present value and Internal rates of Return can be applied in
evaluating mega projects such as the NIGAL, would it provide a useful basis for decision making?
Finally, yet to be learned is how funding for such a project can best be sourced and what are the
implications of these to the entire usable life cycle of the project as well as its valuation based on
NPV and IRR.
Gaps Analysis
The aspects yet to be learned, such as how the entire project cost is generated requires further in
depth approaches and practical case studies. The author is particularly keen on how the such
projects are budgeted for, and how to get supplier collaboration to achieve objectives, including
timely delivery. This is motivated by the Boeing cases where deliveries for aircraft were delayed
due to SCM problems despite all the detailed planning. Another gap is just what needs to be done to
ensure mega projects are delivered on time and objectives met, given that most mega projects
experience overruns and the proposed phased management approach also has limitations with
rigidity. These gaps can be filled through detailed case studies of past of hypothetical projects
involving advanced level simulations to enhance learning and improve practical knowledge as
suggested by (Boateng, Chen and Ogunlana (2017).
Benefits and Value Management
Value has moved away from ‘value management’ ideas to ideas that involve ‘understanding the way
stakeholders value various different things’. In the context of mega projects and following this new
paradigm, value is influenced by the complex morass of involved stakeholders which includes both
internal and external stakeholders. For the internal stakeholders, value of concern is the value that
comes from the deployment of project management while for the external stakeholders, value
emanates from project outcome values, for instance, in the NIGAL project,, external stakeholders
such as European governments would view value as an extra source of natural gas source to provide
an alternative to Russia and Algeria, the present sources. The value framework illustrated below is
prosed for managing value in mega projects based on the work of Oliomogbe and Smith (2012)
Sustainability
Such a project still requires sustainability considerations and in the NIGAL project, the starting
point should be an appreciation and commitment to the UNDP Sustainable Development Goals in
their policies through an integrated approach of project management and delivery through
sustainability in all aspects of the project, from procurement to construction and value management.
Sustainable practices should commence at inception when due diligence is being undertaken
(Eberspaecher, 2017).
Such a project still requires sustainability considerations and in the NIGAL project, the starting
point should be an appreciation and commitment to the UNDP Sustainable Development Goals in
their policies through an integrated approach of project management and delivery through
sustainability in all aspects of the project, from procurement to construction and value management.
Sustainable practices should commence at inception when due diligence is being undertaken
(Eberspaecher, 2017).
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Hwang, B., Shan, M., Zhu, L. and Lim, W. (2018). Cost control in megaprojects: efficacy, tools and
techniques, key knowledge areas and project comparisons. International Journal of Construction
Management, 1, pp.1-13.
Irimia-Diéguez, A., Sanchez-Cazorla, A. and Alfalla-Luque, R. (2014). Risk Management in
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Oehmen, J., Thuesen, C., Ruiz, P. and Geraldi, J. (2015). Complexity Management for Projects,
Programmes, and Portfolios. [online] Pmi.org. Available at:
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11141 [Accessed 24 May 2019].
Oliomogbe, G. and Smith, N. (2012). Value in Megaprojects. Organization, Technology &
Management in Construction: An International Journal, 4(3), pp.617-624.
Parth, F. (2014). Planning and Controlling Megaprojects. [online] Pmi.org. Available at:
https://www.pmi.org/learning/library/planning-controlling-megaprojects-9289 [Accessed 24 May
2019].
Qazi, A., Quigley, J., Dickson, A. and Kirytopoulos, K. (2016). Project Complexity and Risk
Management (ProCRiM): Towards modelling project complexity driven risk paths in construction
projects. International Journal of Project Management, 34(7), pp.1183-1198.
Schneider, R. (2009). Managing projects in complex business environments. [online] Pmi.org.
Available at: https://www.pmi.org/learning/library/complex-business-environments-contribution-
systems-7125 [Accessed 24 May 2019].
Tanaka, H. (2014). Toward Project and Program Management Paradigm in the Space of
Complexity: A Case Study of Mega and Complex Oil and Gas Development and Infrastructure
Projects. Procedia - Social and Behavioral Sciences, 119, pp.65-74.
Zidane, Y., Johansen, A. and Ekambaram, A. (2013). Megaprojects-Challenges and Lessons
Learned. Procedia - Social and Behavioral Sciences, 74, pp.349-357.
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