Athabasca Oil Sands Acquisition Project - Case Study Example

ATHABASCA OIL SANDS PROJECT ACQUISITION Students Name Course Name Professor's Name University Name Executive summary This report makes a critical analysis of the Athabasca oil sands acquisition project and its successful completion and implementation. The project involves the acquisition of oil deposits by Canadian Naturals company ltd from the current owner of the sands deposits The Shell. This project was aimed to expand the operation and increase the profitability of Canadian Natural by acquiring new long term investments. It cost the Canadian Natural about US$12.59 to its completion. The key stakeholders of the project involved the client company-the Canadian Naturals Company and The Shell. Other stakeholders included the shareholders, competitors, customers, the governments involved and the general public. The project management teams were also part of the stakeholders. From the analysis, the project was managed through proper coordination between the project management teams of the company two companies. The project management team involved carried out proper planning and ensured cooperation and communication were efficient between the parties in order to fasten the transaction. A critical analysis of the project indicates that the project was successful owing to the fact that the management team had vast experience in management of projects pertaining to acquisition projects. There was also smooth cooperation and coordination between the two parties in fulfilling their duties pertaining to the accomplishment of the project (Devaux, 2011). Introduction Athabasca oil sands project acquisition is a recent project that involved in acquisition of oil sands deposits from the owner company in order to increase the stake of the client company by increasing its investments. The client company- the Canadian Naturals company deals with extraction of natural deposits and minerals such as crude oil and natural gas as well as refining the crude oil for sale. This project involved a mere transfer of ownership of the mines from Shell to the Canadian Naturals company. This project was completed in March 2017 at a total consideration of $12.59 dollars. The objective of the project was to acquire transformational as well as leverage the strengths of Canadian Natural and Shell. The aim was to acquire more rights in the oil sands deposits to enhance the profitability of the client organization. This was made possible through the acquisition of constant supply of raw materials for manufacturing products. The project was also aimed at strengthening the metrics of the balance sheet in order to increase the profitability of the organization. When the balance sheet metrics are strong the image of the organization improves and therefore enabling the organization gain a competitive advantage over other organizations in the same industry. This also improved and enhances the reputation of the company making it acquire more rights and more investments in future (Culp et al, 2008). Another aim of the project as analyzed in this report was to strengthen the Canadian Naturals robustness and sustainability in order to enhance the strategies in place for achieving the objectives of the organization. The project also targeted the unlocking the upside synergy opportunities and open up the area for more investment to take place. With these objectives, the team had to input a lot of commitment into the strengthening the stability of the project to ensure its success (Eisner, 2009). The scope of the project was limited to the acquisition and the implementation of the operation plan of the oil sands. It involved coming up with a plan to deal with all the logistics of acquisition which included fulfilling the existing laws and procedures as well as taxation that may be needed in the process. This was crucial because it helped avoid penalties due to late payments. The project management teams had a responsibility of assessing the viability of the acquisition in order to determine its profitability in future. It was therefore their responsibility to carry out the feasibility study and project appraisal. This comprised analyzing of all aspects of the project including technical, managerial financial and the market demand that is projected for this project (Eisner, 2009). Project Stakeholders Analysis A project Stakeholder is referred to an individual or an entity which might or might not obtain any benefit from the project but are in one way or another associated with or affected by the results of the project (Frame 2012). The main stakeholders of this project are the management of the two companies through the representation of their project management teams. These teams gave their total commitment to the accomplishment of the project. Other stakeholders of this project are the shareholders of the two companies by extension (Bennett, 2007). The analysis provides the reason being that their stake in the respective companies was going to change significantly so they needed to be assigned a significant level of attention in this whole project. There are other stakeholders of the project who include the surrounding community especially the owners of the neighboring pieces of land who may accidentally suffer loss due to land degradation during mining. This is critical and they have to be updated of every step that is being carried in the project to avoid future claims and disagreements (Fleming et al, 2007). From the analysis, competitors are also a group of stakeholders who may be interested in the implementation of the project. This is because they may raise issues of unfair competition in future in a situation where there are regulations put in place by the industry are not adhered to by the project. Therefore unless for confidential information, any other information they may be in need of ought to be provided for a healthy and peaceful coexistence in the industry (Culp et al, 2008). The customers, suppliers, the government, investors and the general public are groups of stakeholders you cannot ignore. Each of them has their own interests in the project which ought to be satisfied for the purpose of making every group inclusive in the entire project idea. The analysis of this project reveals that the participants of this project were involved in various ways including conducting consultative meetings. This aimed to create an interactive session that facilitated the sharing of the prescribed information in an amicable way to avoid claims and issues in future. However not every information was shared because sharing of sensitive information would cost the business its success. Meetings were conducted by the project management teams to make a close analysis of information that is healthy for the consumption of the public before proceeding to give the same information to other stakeholders of the project (Culp et al, 2008). Information was also available for the public and any other stakeholder to assess and raise any concerns pertaining to it whether a correction or a compliment of the same. How the project was managed The analysis indicates that the project underwent various stages before becoming a success. This involved: Conception stage Planning stage Implementation stage and Review and evaluation stage Conception stage involved the analysis and assessment of the idea itself to ensure it is viable and can generate cash inflows in future. In this stage, the idea was selected after parading of ideas to compare them and make a selection of the most competent one and the one that has a potential of generating more cash inflows. This is where the feasibility study, as well as project appraisal, was conducted in order to evaluate and investigate the success of respective aspects of the project individually and how all of them enhance the accomplishment of the overall objective of the organization (Fleming et al, 2007). Planning stage involved putting everything that is required for the successful implementation of the project. This comprised acquisition of the right manpower as well as equipment that were appropriate for the success of the project. Proper training was done on the project management team by a competent project management trainer to enhance their project management skills and align them with the objectives and the nature of the project. Acquisition of other equipment to be used for the implementation of the project like getting licensed to operate in the scene as well as the relevant documents like the permits and approval by the relevant physical planning departments of the governments (Cleland, 2010). Implementation stage involved putting the plans and the strategies in place in order to achieve the desired objectives. This project was managed by a team that was well trained and had adequate experience and skills in this sector. Therefore, the implementation was done according to the plan although there were limited overrun whose effect was negligible (Eisner, 2009). The review and evaluation stage involved a comparison between the actual performance and the plan to assess achievement of project objectives. All this was made possible through the coordination of the team that was tasked with the responsibility of seeing that project through. This is crucial for project manager because it gives them easy time to review the project and measure accomplishment of objectives (Eisner, 2009). A Critical Analysis of the Project Outcome A close analysis of the project indicates that the project has tremendous success and to greater extent met its set targets and objectives. From the analysis, it was clear that the state of Canadian Naturals increased to a large extent leading to increasing in the profitability as well as opening and unlocking the Synergy side for more opportunities. There was also increased productivity resulting from crude oil and other oil products from the organization due to the acquisition of this oil sands (Cleland, 2010). Due to increased profitability and acquisition of new rights on sources of raw materials, there were increased employment opportunities in the organization hence leading to employment of more staff in the organization who have competent skills to make the specialization of duties and tasks possible. This has led to the innovation of advanced procedures in the organization to make work easier (Bennett, 2007). In addition, the project has led to the expansion of the area it is located in business hub. This has led to the attraction of investors and enabling thriving of business in the area. The standards of living of the people in the scene have also increased because it has increased employment in the private sector through the provision of social amenities to the workers of the mines. Conclusion From the analysis of this project, it is clear that prior proper planning is required for the success of any project. This helps to avoid wastage of precious time during the rush hour and gives the project team ample time in the implementation of the strategies in place. The above project was successful because of efficient plans and proper coordination of the parties involved. Provision of equipment in time is crucial to avoid delay and also enhance smooth flow of activities (Bennett, 2007). REFERENCES Bennett, F. Lawrence. 2007. The management of engineering. New York: Wiley. Cleland, David. 2010. Field guide to project management. New York: Wiley. Cleland, D.I. and Kerzner, H. 2012. A project management dictionary of terms. New York: Van Nostrand Reinhold. Culp, G., & Smith, A. 2008. Managing people (including yourself) for project success. New York: Van Nostrand Reinhold. Devaux, Stephen. 2011. Total project control: A manager's guide to integrated project planning, measuring, and tracking. New York: Wiley. Eisner, H. 2009. Essentials of project management and systems engineering management. New York: Wiley. Fleming, Quentin &Hoppelman, Joel.2007. Earned value project management. Project Management Institute. Frame, J. D. 2012. The new project management. San Francisco: Jossey-Bass. Frame, J. D. 2013. Managing projects in organizations. San Francisco: Jossey-Bass Goldratt, Eliyahu. 2008. Critical chain. North River Press. Read More