Thoughts on construction
For anyone that needs or wants info on the construction process or wants to express an opinion on the process I urge you to review Appendix C of the FS. It is only 7 or 8 pages long and it consists of one big multi page chart that details the whole step by step sequence. Every time I look at it I notice more interesting items:
Early on in the schedule you will see two vertical milestone lines. Many of the individual steps are tied to these. The first one is full authorization to proceed. Although not spelled out, I assume this comes directly after the Big F. Per the schedule this is the day that they start calling for tender offers. The common phrase for this is "go out for bids." They will not start requesting bids until they have money to pay. Bidders may be willing to give them budgetary prices (and I am sure have already) but they will not put the effort into preparing firm price bids unless they know Nio has money. For many of these items the "award contract" date is about two months from call for tenders. If the item is construction it seems to start 2-4 weeks after award of contract. If the item is equipment there may be a period of a few months or a year for more for "fabrication." Based on my personal experience this all sounds pretty normal.
But then it gets interesting. The next big vertical milestone line is "Permanent Construction allowed to start." On the schedule this is shown as 6 months after full authorization. This milestone IS issuance of the Air Construction Permit. There is a band indicating 10 months of engineering leading up to this permit issuance. Turns out it did take 10 months to get the permit, but this step is now done. It would appear that this vertical red milestone line for permanent construction allowed to start can move further left. It could move clear over to shortly after full authorization IF detailed engineering is done. Several of these construction steps are proceeded by several month periods of engineering. I suspect Scott is currently evaluating all of this and looking at what engineering needs to be done first so that construction can start earlier.
Scan on down the chart and notice what big items start on the exact day of this permanent construction allowed to start: SHAFT SINKING (main and vent.) Since we already have the air permit, it would seem that shaft sinking could start earlier. FYI: both shafts start on the same day. The production shaft takes 14 months to bottom out and the vent shaft takes 8 months. Shaft sinking is on the critical path for the whole project. If it starts earlier, then the mine probably goes into production earlier.
The big caveat:
There is a section of this schedule for site preparation. This shows a contract award two months after full authorization and work starting a couple weeks later. The first steps are "clearing and grubbing" and site fencing. These start at the same time and each take 2-3 months. "Mine area leveling and roads" starts a month after these other two items start. The schedule shows this to be 80% complete at the start of shaft sinking. I assume Scott is also looking at this and figuring what he can do to accelerate it. If the permit got issued 6 months after full authorization (as the schedule shows) there was plenty of time to get this work done. Now there are good reasons to speed it up.
