Analysis of Alcan Kitimat smelter's approach in maximizing values of the engineering services

Alcan's smelter in Kitimat is equipped with 50 year old technology and is therefore close to the end of its operating life. A major capital investment will be required sometime in the future, to extend operations at this location. Each year, approximately $1 00 million is spent on sustaining projects and maintenance to support smelter operations. Sustaining projects fall into two categories, one is the replacement or upgrading of existing equipment and the other is the addition of new equipment to meet changing environmental, health and safety regulations. Managing the projects generated by these sustaining expenditures is a challenge for the engineering department. With limited manpower resources, Alcan engineering has to rely on the services of engineering consulting firms. Consulting engineering firms play a key role in managing these sustaining projects by providing manpower and expertise for all project phases. An isolated location further complicates the availability of support resources for all three major industries operating in Kitimat. Finding a satisfactory solution for both industry and consulting firms is a challenging task. For Alcan, a long term planning strategy cannot be fully developed without consideration and promotion of a long-term business plan.