Managing Environmental Project at PT Inco; Actualization of Professional
            Ethics as a Professional Engineer of ...
products.                                    form of Post Mining Areas Rehabilitation,
recommendation over reclamation program                sedimentation    in    during   Mining
which is integrated with com...
Excellence in selection, installation and
maintenance of Assets required by PTI to             1. To provide facilities th...
request, the benefit for the company, was it
                opportunity or stay in business and how
Functional Manager and some of
         the team also were doing other
         projects and daily activities and
design, procure, construct and           c. Scope Control and Verification, to
        provide 3 months warranty after the...
   Media handling, the open building to                   determine the actual results of the
    prepare the seed.      ...
exhibit the highest standards of honesty and        Develops and implements the planning,
integrity. Engineering has a di...
       Study conducted together with project       Project Management Body of Knowledge,
       team. This means, the de...
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Managing Environmental Project at PT Inco; Actualization of Professional Ethics as a Professional Engineer of Indonesia


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This paper was presented in front of Conference of ASEAN Federation of Engineering Organization (CAFEO25) at Cebu City, Philipppines, 26 - 29 November 2007

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Managing Environmental Project at PT Inco; Actualization of Professional Ethics as a Professional Engineer of Indonesia

  1. 1. Managing Environmental Project at PT Inco; Actualization of Professional Ethics as a Professional Engineer of Indonesia (Nursery Project) Habibie, Ir., IP, Ridwan Setiawan, Ir PT Inco Central Engineering DP.08, Sorowako, South Sulawesi 92984, Indonesia Andi Erwin Syarif, Ir, IP., MT PT Inco Government Relation, DP.23, Sorowako, South Sulawesi 92984, Indonesia 1. PT Inco Profile; One of the World’s Premier Nickel Producers 1.2. Vision 1.1. General Overview PT Inco intends to remain a leader among PT Inco for more than three decades, since multinational businesses based in Indonesia the signing of its Contract of Work with the by consistently producing high returns on Indonesian Government in 1968, the investment while adhering to strong Company has provided skilled jobs, shown corporate values. concern for the needs of the communities in which it operates, benefited shareholders We will realize our vision by enabling and contributed positively to the Indonesian employees to reach their full career economy. potential and achieve outstanding results for our Company. PT Inco produces nickel in matte, an intermediate product, from lateritic ores at We will strive to provide a safe, healthy its integrated mining and processing and stimulating work environment that facilities near Sorowako on the island of maximizes opportunities to enhance PT Sulawesi. Its entire production is sold in US Inco’s success as a high quality nickel Dollars under long-term contracts for producer. refining in Japan. PT Inco’s competitive strengths include abundant ore reserves, a We take pride in promoting environmental skilled, well-trained workforce, low-cost responsibility and advancing community hydroelectric power, modern production development. facilities and an assured market for its product. 1.3. Mission The Company is owned 60,80 percent We will meet our commitment to: owned by CVRD Inco, 20,1 percent owned by Sumitomo Metal Mining Co. Ltd, 17,9  Investors through sustainable and percent owned by publics and The others consistent long-term earnings are owned by consortium of 4 Japanese growth. Company.  Employees by ensuring safe, Through the strength of our people and healthy and rewarding work. resources, we strive to be a safe, reliable, and profitable growth-oriented primary  Customers by meeting our nickel producer. obligations with respect to the quality and timely delivery of our 1
  2. 2. products. form of Post Mining Areas Rehabilitation, Sediment Control, Liquid Waste Control as  Indonesia through responsible well as Dust Emission Control. corporate citizenship, fulfilling our Contract of Work commitments and community and environmental responsibilities. PT Inco is committed to ensuring that it will operate in a clean, healthy and safe work environment; will take necessary steps and invest approximately to meet its environmental obligation Figure 2 - Plantation of Work in Post Mining Land 2. PT Inco’s Commitment in Environmental around Contract of Work Since the post mining area reclamation was started on 1980, PT Inco has conducted continual improvement on their 2.1. Environmental Management in performance with sustainable development Mining Land Operation principle. When the post mining area reclamation was started, they focused on The commitment is spelled out in the erosion control. Since then many efforts has Company policy relating to environment, been done to improve the performance. health and safety stating that PT Inco is committed to sustainable development In 2003, PT Inco created standardization of concept, taking into account the equitable post mining area reclamation which has balance between economic growth and been certified by Directorate General of sound handling of human health and Mining to meet the demand for an optimum environmental protection result entirely. It consists of best practice of post mining area reclamation activities. Since then, the activities became an un- separated part of mining plan until execution level. Up to the end of 2005 PT Inco Tbk has re- vegetated 2.844 hectares of post mining areas. PT Inco Tbk has cooperated with PSl-UNHAS and The Biotechnological Forest Laboratorium IPB in doing repeated Figure 1 - Nursery Activities for Mining surveys and studying the reproduction of Rehabilitation many local endemic plants to support the local endemic revegetation program. The policy necessitates PT Inco not only to meet, but whenever possible, to surpass PT. Inco always tries to integrate the post environmental national standard established mining area reclamation program with the by existing regulation. community development program so people can take advantages from the PT Inco is committed to ensuring that it company. The company invited Mr. Zukri will operate in a healthy environment, by Saad (consultant, former Executive conducting continual improvement on the Director of WALHI), to evaluate the living environment performance, in the reclamation program and to give 2
  3. 3. recommendation over reclamation program sedimentation in during Mining which is integrated with community and exploration, operation and post mining local government development program. operation. PT Inco also had been doing the installation of new high technology called Off Gas Cleaning System throughout all the Processing Plant System starting from Furnace System since year of 2004. The objective of this project is to reduce the amount of gas emission produced by the process plant operation. The other program is Hydrocarbon Management which is ensuring that all the hydrocarbon use must comply with Figure 3 - Areas Rehabilitation Status at the End of environmental regulation by Indonesian 2004 PT International Nickel Indonesia Performance Monitoring Post Mining Areas Law. The scopes of the program covered in Re-vegetation Status Q4 - 2004 Environmental Management Standard – EMS 01 produced by PT Inco with the purposes are: a. To ensure all Hydrocarbon facilities at PT Inco recorded in a Central PTI Hydrocarbon Management Register that will be accessible and kept up to date. b. To ensure all Hydrocarbon facilities are subject to a formal environmental risk assessment and that appropriate control are implemented. 3. Support and Engineering Services Department of PT Inco; Place for Managing the Capital Projects 3.1. General Overview Support and Engineering Services (SES) Figure 4 – ADITAMA Reward Gold Achievement provides support to the entire PTI from Energy and Mineral Resources Department, organization in the form of Capital Project Republic of Indonesia. Management, Engineering services, Construction Services, Fabrication, Maintenance System support and Shutdown 2.2. Environmental Management in Planning. There are approximately 500 PTI Processing Plant Area employees in the department, while approximately another 500 people are In the year of 2006, PT Inco also Achieve managed through contractors. the Gold of Aditama Reward from Energy and Mineral Resources Department, 3.2. Vision Republic of Indonesia due to the successful in controlling the erosion and managing the 3
  4. 4. Excellence in selection, installation and maintenance of Assets required by PTI to 1. To provide facilities that will be able to meet is vision. A team of highly skilled, cover the nursery process in one energized professionals delivering this complete facility. The new Nursery was Support Safely, reliably and predictably. intended to get 1 Million of trees per year. 3.3. Mission 2. To provide the international class of nursery which also a laboratory for Provide Asset Management Support to the students and to learn how to understand entire PTI organization in the form of the reproduction of endemic population Capital Project Management, Engineering in Sorowako area. services, Construction Services, 3. A recreation place for various of Fabrication, Maintenance System support plantation in Sorowako which also can and Shutdown Planning. be a training facility for community around Luwu Timur area. 3.4. Goals and Objective a. Capital Projects delivered safely, on 4.2. Project Life Cycle time, on budget and meeting the owner’s expectations. The life cycle of the project was started b. Safe, cost effective, timely and high from project initiation until close out quality delivery of construction process as follows: projects. c. Installation of the Asset Management 4.2.1. Project Initiation Framework. d. Support for the operating departments Project initiation, was started in January to maintain PTI’s assets to fulfill the 2005, there were several part in this phase: stakeholders’ sustainability a. Business case submission to strengthen expectations. the justification was submitted by INCO CAPITAL PROJECT DEVELOPMENT PROCESS e. Effective and efficient maintenance Manager Mining and the Project Sponsor. It was consisting of the INCEPTION shutdowns every time. IDEA / OPPORTUNITY Q /A MANAGEMENT GATE 1 f. Effective People meeting personal background why the request should be - OPPORTUNITY REVIEW - RISK RANKING 1 NO and organizational goals. approved, the safety and environment - BUSINESS PLAN FIT ( CAPITAL REVIEW TEAM / MANAGEMENT APPROVAL ) YES risk ranking process, defining the PRELIMINARY NO MANAGEMENT GATE 2 FEASIBILITY STUDY Q /A PRELIMINARY REVIEW alternatives of what we’re going to do - EVALUATION OF ALTERNATIVES - RISK ASSESSMENT 2 NO to solve the issue, and providing - BUSINESS PLAN FIT 4. Nursery Facility Project - STRATEGIC PLAN FIT ( CAPITAL REVIEW TEAM / MANAGEMENT APPROVAL ) YES sensitivity analysis of return on VIABILITY TECHNICAL FEASIBILITY STUDY investment and payback period. MANAGEMENT GATE 3 Q /A 4.1. The Background and Key Objectives FEASIBILITY REVIEW - PROJECT VIABILITY YES NO b. Capital review committee was doing 3 - BUSINESS PLAN FIT - STRATEGIC PLAN FIT ( CAPITAL REVIEW TEAM ) YES The background of this project was the the risk ranking and approved to be CAR PREPARATION capitalized as unplanned capital project Q /A previous nursery facility could not provide MANAGEMENT GATE 4 4 NO more contribution to rehabilitation need in early of 2005. CAR APPROVAL YES since the land of post mining required more c. Engineering work request (EWR) was ORGANIZE PROJECT Reject & File raised by the Mining Department as the EXECUTION seeding and variety of trees to be re- PROJECT KICK-OFF vegetated. The existing facility also was not Owner to Central Engineering to ENGINEERING / PROCUREMENT Q/A PEER REVIEWS continue the project to the process. / PROJECT QUALITY PLAN presenting the face of commitment of PT Inco to provide international quality of re- d. Superintendent of Engineering to assign CONSTRUCTION vegetation result in post mining process. the Project Manager and Team. COMMISSIONING Q /A In this phase, the sponsor also provided the MANAGEMENT GATE 5 OWNER ACCEPTANCE ( CARE, CUSTODY & CONTROL ) 5 In 2005, PT Inco decided to start to build presentation called “Preliminary Study YES START-UP / RAMP-UP Stage” as the part of business case COMPLETION the world class of Nursery (total area is 2.5 Ha) with the objectives are: submission consist the background of the POST PROJECT REVIEW Q /A NO TURN-OVER YES CLOSE-OUT MANAGEMENT GATE 6 4 QUALITY ASSURANCE OWNER FINAL ACCEPTANCE 6 Q /A PEER YES REVIEWS ARCHIVE PROJECT Q /A MARCH 31, 2004
  5. 5. request, the benefit for the company, was it opportunity or stay in business and how significant the product will impact the production and long term company business. The flowchart below (Figure 5) is showing the management of capital project development process at PT Inco. 4.2.2. Project Planning Figure 5 - Inco Capital Project Development Process (Project Initiation Process Group) Project planning, was started the in March 2005 under PT Inco Project Manager. This phase comprise of: d. Risk Planning, the Project Manager, a.Project Engineer will be assigned to help Project Engineer and Team to review ger related to Technical Issue during pro life cycle. ject the documentation of related b.Established project scope definition information, gathering the information sponsor to get information deeper about “why are we doing such as the location of the project in tives, the generic project scope requirements, the location term of physical condition, community on, the major material and equipment required for this and social condition, the topographical ment, health and safety requirement, what the product will assessment, the security and safety dget, project constraints and risk planning, and other related aspects to be considered during the project life cycles so the risk can be c.Scope planning and project planned, solved, monitored and development, to seek more input about the requirement of responded as it should be. Also the phase was really important to ensure the operation people, analysis of assumptions and constraints tative and the owner were in the same perception of the end should be collected to ensure we had The project manager required to understand what the the quick and proper response risk pen in this nursery (Hazop study), what kind of facility and planning. red to ensure the operation is running, the type of materials e. Provided preliminary Layout and Work re interruption after the product completed. There were so Breakdown Structure (WBS) to ensure must be addressed prior to procurement and design phase. there were no work packages were missed as agreed scope with the sponsor of the project. f. Arranged CAR and budget book comprises of: - Statement of objectives and deliverables of the project, - Budget Estimate, - Scope of Work. - Schedule Development and Network Diagram, - Hazard and Operability (Hazop) study result, technical feasibility study (including environment and safety evaluation). - Human resources planning and organization chart. The type of the organization is Composite type where all the project Manager’s team were taken from different 5
  6. 6. Functional Manager and some of the team also were doing other projects and daily activities and report to their Manager which was outside this project activities. Figure 7 - Simple Project Organization Chart of Nursery Project 4.2.3. Project Execution Project Execution, was started on June 2005 and finish on April 2006. There were several phases to be included as the part of execution phase, these could continue after the CAR/Budget Book have been approved by PTI Senior Management Level. a. Continued the Approved Preliminary Lay Out into the detail design phase. The process of the design consist drafting of the drawing and bill of material calculation, scope of work, specification detail. These whole works Figure 6 - Failure to Communicate Scope were collected into the product called “Engineering Work Package – EWP”. In this phase, the Project Manager worked b. Tendering and Contract Process. This with the Project Engineer to ensure all the process was involving contract services related aspects of the project requirements department to assign Contract Engineer were fulfilled. The organization chart of the to help the Project Manager in project was shown in CAR/Budget Book arranging the tender (pretender meeting submission as shown below. The budget of and site visit with the contractor) and the project was US$150,000 at the first contract submission with the awarded stage, due to scope creep the project value contractor afterward. became US$ 350,000 by the end of the c. Procurement Process. The required project. materials as per Bill of Material could Owner: Harry Asmar be directly ordered as warehouse stock Manager of Mining and/or direct purchase. The phase of the purchase could be divided by three major processes are: provided MR, Sponsor: Dwayne Kroll select the best vendor and produce the Mine Engineering Department contract to liaise with the selected vendors. d. Construction Process. The construction Project Manager of the Nursery Project was undertaken Glenn Schrum, P.Eng by 2 main contractors as the project was divided by two major works: Project Engineer Construction Manager i. Landscaping work by PT Mitra Habibie, Ir., IP Terry Cavender Ateda using Turnkey project type. The contractor was responsible to Design Engineer: Contractor: PT. Mitra Ateda, Jakarta PT. Capra Karya 6 Habibie, Oesman Reza, PT. Mitra Ateda Selaras Alamsyah Syamsuddin
  7. 7. design, procure, construct and c. Scope Control and Verification, to provide 3 months warranty after the ensure the scope of the project still product of the project was meet the updated project scope completed. The landscaping work definition as the Project Sponsor product will be detailed in requested and ensuring the product of deliverables of the project. the project to be accepted in every ii. Main access road, drainage, phase or process of the project. electrical power supply and lighting d. Risk Monitoring and Controlling, this facilities. process was intended to identify, e. Commissioning Process. The analyze, and planning for new risk and commissioning of the facilities to be keeping on track the current risk that divided in four major disciplines, the has been identified in Risk building itself, the electrical and Identification/Risk Planning. In this instrumentation system and mechanical particular case, the risk of the project commissioning consists of pump, tank was only concern on schedule and sprinkler commissioning. achievement due to the new facilities During Project Execution Process Group will be inaugurated by the Minister of the Project Manager will give more Forestry on April 2007. Other related responsibility to Project Engineer to set up risk such as material and equipment and implement the Quality Assurance; is delivery from manufacturer to project the application of planned, systematic site was very low. quality activities to ensure that the project will employ all process needed to meet the 4.2.5. Project Close Out requirements. This phase was intended to close out the 4.2.4. Project Monitoring and project that was started on May 2006 and Controlling completed on August 2007. The closing out process divided into two major activities; This phase consisted of several Process administrative closure and contract close Group: out. Arrangement of Care, Custody and a. Managed Project Team, during this Control was taking place formalizing the phase the Project Manager was strongly final acceptance of the Sponsor to the final recommended to keep the team product. consistent to the completion of the project. Building the team spirit and The final product from this project resolving the conflict during the comprised of several facilities as follows: execution of the project. The Project  Office building, Senior Supervisor of Manager should be able to ensure the Re-vegetation of PT Inco and his crews project was finished on time, on budget, getting the office for daily activities to on schedule without Disabling Injuries. plan, execute, monitor and control the b. Quality Control Program, the inspection nursery activities. of quality control should be the part of  Parking area access road along the area. the Project Manager’s responsibility to  Water tank with capacity 50,000 liters ensure the satisfaction of the client after for watering the plantation. the project was handed over to the  Electric pump to operate the Operation (project Sponsor). The sprinkler/spray system. quality control program such as  Open area for watering area/hardening concrete compressive strength test, (sprinkling area). Place for seed to galvanized film and painting thickness adapt before planted on the field, of the structure, electrical grounding automatic spray system. The capacity is test, pressure test, and other related 600,000 plants per cycle. inspection and testing plan (ITP). 7
  8. 8.  Media handling, the open building to determine the actual results of the prepare the seed. project with respect to Savings, Profits,  Germination house, the facility to for etc. seed reproduction using generative  To recognize subsequent actions which method and place for sprinkling the may be necessary that was not taken in seed. The capacity is around 300,000 the project from beginning till the end. seeds per cycle. We called it work breakdown structure  Propagation house, facility for local lessons learned. plant reproduction using vegetative method. The capacity is 400,000 per cycles. The use of sprinkling for adequate watering, the light intensity is 75% and the roof type of the facility is using UV plastic.  Mycorrhiza house, the facility to produce the fertilizer with the capacity 2 tons/year. Areal pembibitan berdiri di atas lahan seluas 2,5 hektar.  Hydroponik training facility. Fasilitas pembibitan terbesar industri tambang di Indonesia.  Seed storage container.  Wooden house for recreation and Germinationn House refreshing. Seed Container Propagation House Media handling Shaded House Hardening Hydroponik Training Facility Pump Mycorrhiza House Office Water Tank Figure 8 - Final Product of Nursery Facility Project Other things should be the part of close out 5. Code of Ethics as Professional process group is to complete the post audit Engineer of Indonesia contains lessons learned with the purposes as follows: 5.1. The Ethical Professional Engineers  To provide valuable source of The Institution of Engineers, Indonesia information for improving the project (PII) declared the professional ethics that and any lesson shared. should be practiced by all the Engineers of  To provide opportunity to create Indonesia as per Anggaran Dasar and accountability within the process for Anggaran Rumah Tangga of PII. estimates given and any decision made during the project execution phase. We know exactly that the Engineering is an  To provide an important financial important and learned profession. As control mechanism, to look back and members of PII, engineers are expected to 8
  9. 9. exhibit the highest standards of honesty and  Develops and implements the planning, integrity. Engineering has a direct and vital scheduling and estimating of the impact on the quality of life for all people. Engineering function. Accordingly, the services are provided by  Responsible for the quality, technical the engineers require honesty, impartiality, competence and professionalism of the fairness and equity, and must be dedicated Engineering effort. to the protection of the public health, safety  Complete engineering design and welfare. calculations to meet accepted design standards, project scope and PTI In fulfilling our professional duties, we standard specifications. shall:  Prepare and collate Engineering Work  Hold paramount the public’s health, Package documentation, to ensure all safety and welfare. aspects of construction, safety and  Perform services only in areas of our quality are clearly defined. competences.  Provides Engineering direction and  Avoids conflict of interests. support for Procurement and  Act as a faithful agents or trustees of Construction groups in the formulation our client’s interest. of the Procurement and Construction Plans.  Avoid improper conduct in the  Resolve technical issues during project solicitations for assignments. execution and commissioning, to ensure  Act to uphold honor, integrity and the the project meets the planned objectives dignity of our professions. and quality.  Maintain competence in our professions  Informing the project manager through continuing education and regarding progress on tasks and report training. immediately when a judgment is made  Respect our community and that the output targets cannot be met, or environment in all of our endeavors. more can be achieved.  Asking the project manager for clarification, when needed, on what is 5.2. Project Engineer’s Role as an expected of the role. Actor who Implemented  Taking the initiative to improve your Professional Ethics work, the overall business, and promote the goals of the organization. In PT Inco, Project Engineer has more  Working effectively and collaterally responsibility rather than other project team with immediate colleagues and others to run the project to meet the deliverables in cross-functional relationships, on of the final product, safety, cost and related tasks within the context of corporate Key Performance Indicator (KPI) factors. policy, values, and culture. In this case, the purpose of Project There are a lot of accountabilities should be Engineer’s role is to provide Civil performed by Project Engineer of PT Inco Engineering Technical Expertise to support and should be relevant to actualization of all civil work related to Engineering Professional Ethics as Professional Department’s Accountability. Managing Engineers. Engineering projects related to civil engineering and implementation program. During working in Nursery Project, there Generic Accountabilities (all employees will were several engineering activities be accountable for the following): decisions made up by the project engineer such as:  Determined the best location of new Nursery Facility as per Feasibility 9
  10. 10. 1 Study conducted together with project Project Management Body of Knowledge, team. This means, the decision was 3rd Edition. Project Management Institute, made based technical judgment as the Four Campus Boulevard, Newton Square, way should be (no conflict of interest). USA, 2004  Managed the scope limitation between 2 the two contractors who did the works. Capital Project Owner’s and Sponsor’s The scope of works had been performed Handbook. PT International Nickel in the contract and tender arrangement Indonesia, 2005 before then. No works shall proceed 3 without contract agreement and so the Engineering Procedures Manual. PT contract must be detailed on what and International Nickel Indonesia, 2006 who’s doing the related works. 4  Managed the construction works on the AD/ART & Susunan Pengurus Masa Bakti field, fair in making the decision if 2006 - 2009 Persatuan Insinyur Indonesia. there was a deviation to quality or Persatuan Insinyur Indonesia (PII), 2006 scope of works performed by the 5 contractors. They should rework and/or Sid Dewberry GMU Graduation Speech, repair the defects if it was not meeting 2005. the quality satisfaction. 6  Conducted the safety layer audit (SLA) PT Inco website: to ensure all the workers were working, 2006. safely and returns at home safely. The professional engineers should hold the responsibility to protect and help the project team (from PTI project team or contractor) with ensuring the done the right, safe and proper actions.  Improved the designs that were raised by the consultant to meet the standard and specification of PT Inco such as the installation of vertical and horizontal bar inside the concrete block walls to ensure the building is strong enough from seismic design since Sorowako area is very closed to central of earth work (zone#4).  Approved all the design changes done by the contractor which were expected to change the quality of required designs and specifications. Professional Engineers should always rely on technical judgment during project execution.  Decided to install the disconnect switch outside the office building for electric pump to ensure the power could be switch off if the failure occur to the existing system. Reference: 10