Mining capital projects present a unique combination of complexity, scale, and risk. Whether developing new assets, expanding existing operations, or sustaining critical infrastructure, these initiatives demand rigorous planning, precise execution, and strict governance. Given the high capital intensity and long lead times associated with mining projects, visibility into project performance is essential to mitigate risks, control costs, and ensure alignment with strategic objectives.

SAP is widely adopted across the mining sector as the enterprise backbone for managing financials, procurement, fixed asset lifecycles, and capital expenditure. However, without the right capital project controls in place, even SAP-based environments can struggle with fragmented processes, limited reporting capabilities, and manual workarounds that compromise decision-making.

This blog explores how organizations in the mining industry can leverage SAP to create capital projects with full visibility from budget to closeout. By incorporating integrated project controls and automation, mining teams can drive better outcomes, reduce lifecycle costs, and achieve greater alignment across all project phases—from budget creation and approvals to execution, completion, and capitalization.

Why Visibility Matters in Mining Capital Projects

Mining capital projects are inherently complex and high-risk, but these challenges are amplified by industry-specific conditions. In the mining industry, projects are frequently executed in remote or logistically constrained locations, requiring significant upfront investment in infrastructure, supply chain coordination, and workforce mobilization. Layered on top are stringent regulatory and environmental requirements that demand continuous compliance throughout the project lifecycle.

Commodity price volatility further complicates capital planning. A project that is economically viable at the time of approval may become marginal if market conditions shift. In this environment, delays, scope changes, or cost escalations can have a disproportionate impact on return on investment. Without visibility into performance metrics, committed costs, and emerging risks, capital project managers are effectively operating blindly.

The consequences of poor visibility are not hypothetical; they’re well-documented. Inadequate insight into schedule, budget, and risk often results in budget blowouts, delayed commissioning, and underutilized assets. Worse still, projects may progress past critical decision points before issues are detected, leaving little room to course correct.

Case in Point: Oyu Tolgoi Underground Expansion

The Oyu Tolgoi underground copper and gold mine in Mongolia—operated by Rio Tinto—is one of the most prominent examples of major mining capital projects impacted by insufficient visibility and control. Initially approved with a $5.3 billion capital budget, the project’s costs surged by $1.8 billion, reaching a total of $7.1 billion, according to Mining.com. In addition to cost overruns, the project faced nearly two years of delays. Contributing factors included unanticipated geotechnical conditions, misaligned project models, COVID-19, and governance gaps between engineering teams and financial stakeholders. A lack of integrated reporting hindered early identification and resolution of these issues.

For mining organizations aiming to maximize capital efficiency and minimize execution risk, visibility is not simply about reporting—it’s about enabling proactive management across the entire capital project lifecycle. SAP, when extended with Fiori Apps purpose-built for capital project governance, offers a pathway to that level of control.

Creating and Managing Capital Projects in SAP

Managing capital projects in mining isn’t just about tracking costs, it’s about navigating complexity. With tight margins, remote operations, and fast-changing conditions, mining companies need a streamlined, scalable way to govern scope, spend, and schedules.

SAP provides the foundation for managing capital spend, but real value comes from tailoring it to the mining context. That means using SAP not just to capture data, but to drive smarter decisions—starting with key tools like Work Breakdown Structures (WBS), Internal Orders, and Networks, and extending through standardized templates, automation, and modern interfaces like SAP Fiori^®.

Laying the Groundwork: WBS, Internal Orders, and Networks

A clean, well-structured Work Breakdown Structure (WBS) is the backbone of capital project control in SAP. It lets mining teams break projects into phases and activities—site clearing, tunnelling, haul road construction—each with its own budget, timeline, and accountability.

Internal Orders complement the WBS by capturing early or standalone spend like feasibility studies or land access—before a full project structure is defined. Lightweight and flexible, they ensure early costs don’t get lost or misclassified.

Networks bring scheduling into the mix. These define task dependencies – think equipment delivery before drilling or blasting before haulage infrastructure – allowing tracking and proactive schedule management.

Together, these three tools give mining capital project managers the financial, functional, and temporal control they need to deliver outcomes, not just reports.

Standardization at Scale: Master Data and Project Templates

As mining capital projects and their portfolios grow, standardization becomes a powerful accelerator. SAP master data—work centers, activity types, suppliers, service masters, material groups—create a consistent foundation. Project templates then build on that, enabling repeatable setup across common project types like plant upgrades or haul road construction.

With standardized master data and templates, mining companies can scale faster, adapt to jurisdictional requirements, and roll up data for cross-project comparisons—without reinventing the wheel.

Project Process Optimization: Where SAP Delivers Real Returns

Mining companies often fall into the trap of relying on spreadsheets for forecasting, approval workflows, or progress tracking—creating silos, delays, and audit risks. Optimizing the capital project process in SAP means breaking out of that trap.

When project controls live outside SAP, like in spreadsheets or siloed tools, risk multiplies. By automating and integrating across the project lifecycle—budgeting, procurement, scheduling, forecasting, and commissioning—companies can:

• Speed up approvals with role-based routing and built-in checks
• Spot budget overruns early with variance reporting
• Improve cash flow forecasting via integrated settlement and program alignment
• Eliminate manual rekeying with prefilled templates and smart defaults

These improvements don’t just make the process smoother, they directly impact project timelines, cost certainty, and strategic alignment.

Leverage SAP Fiori to Streamline Capital Project Management

SAP’s backend might be powerful, but for real project agility, user experience matters. SAP Fiori apps deliver a clean, intuitive interface that bring capital project tasks front and center—making it easier for teams to respond to change and maintain control.

Project managers can use a Project Creation Fiori app to set up structures that meet governance rules from day one. A Budget Transfer Fiori app lets teams reallocate capital as field conditions change. And a Forecasting Fiori app provides insights into committed and actual spend more waiting for monthly updates.

Fiori-based capital project controls aligned with SAP master data and capital workflows enable decisions to be made earlier and with greater confidence—when they have the most impact.

For mining firms facing volatile conditions and razor-thin margins, it’s not just about having SAP, it’s about using it smarter.

Achieving Control Across the Capital Project Lifecycle

For many mining organizations, the foundation is already in place—SAP is live, WBS structures are defined, and budgets are loaded. However, without connected forecasting, embedded analytics, and modernized workflows, true visibility and control remain out of reach.

In mining, capital project timelines are constantly under pressure—from variable ground conditions to equipment lead times and complex environmental approvals. With so many moving parts, control over progress, spend, and forecasting is essential for keeping CapEx projects aligned with strategic objectives and avoiding costly overruns.

SAP Project System (PS) offers the backbone for managing these complexities. Project managers can define and monitor key milestones within WBS elements and Network activities, tracking actual start/finish dates against planned timelines using milestone billing or progress tracking. This enables better visibility into how work is progressing across remote or high-risk sites.

When integrated with Funds Management (FM), SAP adds another layer of financial control. Commitments and actual expenditures can be continuously monitored against approved capital budgets, helping ensure compliance and preventing budget leakage. Tracking means mining companies can avoid surprises and make informed decisions with confidence.

CapEx forecasting is also strengthened through periodic project evaluations (CJEV/CJEN), where SAP pulls in actuals and updated estimates to adjust remaining costs or calculate earned value metrics. With data flowing from procurement, time capture, and goods receipts, these forecasts reflect current execution realities—not outdated assumptions.

Mining companies that have added workflow, interface, and reporting capabilities to their existing SAP systems to drive better capital governance, visibility, and user experience can take this control even further. For example, embedded analytics and role-based dashboards highlight variances at the WBS or line-item level, while smart workflow apps allow mid-cycle budget adjustments and transfer postings directly within SAP (e.g. using transaction CJ30 or FMRP_RW_BUDCON) without introducing manual workarounds or spreadsheet silos.

By combining structured project definitions in SAP PS with Funds Management controls and analytics, mining teams can detect deviations early, respond to disruptions faster, and maintain control across the full capital project lifecycle.

Proactive Risk Mitigation in Mining Capital Projects

Mining capital projects face a range of risks—scope creep, supply chain delays, and cost escalation—that can rapidly derail timelines and inflate budgets. For project managers, the pain of these disruptions is all too familiar. Delays mean lost revenue, increased costs, and a constant scramble to get projects back on track. Without the right capital controls in place, teams are left reacting to problems instead of preventing them.

That’s where CapEx Fiori Apps come in. These tools give capital project managers the visibility and control needed to proactively manage capital projects from the outset—starting with standardized project setup. By enforcing consistent work breakdown structures and budget classifications, teams can create projects efficiently and ensure financial tracking is aligned from day one.

Once underway, risks can be flagged and addressed through real-time monitoring. CapEx Fiori Apps enable continuous variance tracking, combining actuals with forecasted costs to provide accurate projections of total spend. This makes it easier to assess funding requirements and avoid budget blowouts. If project assumptions change, budgets can be transferred between WBS elements, project years, or even across projects—without losing control or resorting to manual workarounds.

In contrast, the typical risk management process relies on outdated, reactive measures. Without early intervention, the consequences of supply chain delays or cost escalation are often realized too late, leaving project managers with few options and limited time to recover. By integrating financial data with project timelines, CapEx Fiori Apps enable early intervention, reduce impact, and lead to more predictable outcomes.

At project completion, these tools support asset evaluation and financial closure, ensuring the value of capital work is clearly captured and reported. Executives can approve projects with confidence, backed by real-time performance insights and portfolio-wide visibility.

With CapEx Fiori Apps supporting each step of the capital project control process—project creation, forecasting, budget transfers, completion, and performance analysis—mining project teams can shift from reactive firefighting to strategic control. Risks are no longer surprises, but signals for informed action.

Streamlining Approvals and Budget Transfers

In mining projects, especially those governed by joint ventures or board oversight, funding approval delays are a common friction point. These delays often stem from fragmented processes—manual forms, inconsistent documentation, and poor visibility across stakeholders.

When CapEx workflows are embedded directly in SAP and structured with digital approvals, project managers gain a controlled and repeatable process for both new requests and in-year budget adjustments and transfers.

SAP-Integrated Approvals

Digital workflows configured in SAP allow project teams to initiate requests using pre-populated forms with validation against master data and budget availability. Approval routing can be rule-based, reflecting governance layers such as site management, JV partners, or corporate boards.

This removes ambiguity around approval paths, ensures auditability, and prevents submission errors or misaligned requests from progressing.

Budget Transfers with Governance Controls

Capital project plans often shift based on changing mine conditions, contractor costs, or material pricing. Reallocating funds across WBS elements or internal orders is necessary—but can be high-risk without a structured process.

SAP-based budget transfer workflows enable controlled reallocations with built-in checks: configurable thresholds, mandatory justifications, and approval steps. All actions are logged in SAP, supporting governance compliance and financial reporting integrity.

Practical Impact

For mining project teams, this means fewer delays in project execution due to funding holds, and a more agile response to changing conditions while staying compliant with internal and external governance requirements.

What Mining Project Failures Reveal About Capital Project Control Gaps

Audit reports and regulator findings in the mining sector often reveal recurring issues:

• Cost blowouts hidden until too late
• Lack of clear justification for budget increases
• Delayed detection of scope creep
• Inaccurate or incomplete spend reconciliation

Often, the root cause of failed capital projects isn’t poor project delivery—it’s the lack of integration between planning, procurement, and execution systems.

When mining capital projects are managed inside SAP, supported by structured workflows, digital approvals, and timely data capture, teams gain the visibility and control they need to stay ahead of risk:

• Track budget vs actuals at the WBS or cost element level
• Monitor commitments the moment a PO or contract is raised
• Get notified early when forecasts deviate from plan
• Maintain a digital audit trail of every budget change, transfer and decision

This level of visibility is critical in mining, where delays, weather events, or compliance issues can quickly snowball into rework or idle time.

By embedding capital project controls —from budget release through to final capitalization—project managers can avoid the “zombie project” trap, where physical work is done but financials stay unresolved. Instead, they ensure clean closeout, compliance, and full transparency for audit and finance teams.

Completion, Handover, and Operational Readiness

Once mining capital projects reach the completion phase, the focus shifts to ensuring accurate capitalization, proper closure, and a smooth transition to operations. However, this stage is often fraught with challenges that can undermine the financial integrity of the project and hinder operational readiness.

Accurate Capitalization and Closure

The final step in managing a capital project within SAP involves ensuring the project is accurately capitalized and fully closed out. Any oversights in this process can result in inaccurate financial reporting, leading to issues with depreciation, tax reporting, and audit compliance. This step requires a meticulous approach:

• Correctly allocating costs to the fixed asset register
• Ensuring no costs are left unaccounted for
• Performing a detailed reconciliation between actual spend and forecasted values

A structured workflow integrated into SAP ensures that every cost is correctly allocated, and capital expenditures are accurately transferred to assets for long-term depreciation. This minimizes the chances of project misclassification and simplifies reporting for audits.

Structured Handover to Operations

With mining projects, the handover from the project team to the operations team can often be a major pain point. A lack of proper documentation, incomplete information, or the absence of an integrated system to track all aspects of the project can create roadblocks that slow down operations. This is where integration between project execution and operational teams plays a vital role.

By implementing a structured handover process within SAP, project managers can ensure that all relevant data—such as equipment specifications, maintenance requirements, and asset management details—are seamlessly transferred to operations. This ensures that operations teams are fully equipped to handle the assets and systems, eliminating gaps in knowledge and reducing the risk of operational disruptions.

Ensuring Operational Readiness

To ensure smooth operations post-handover, it’s crucial that all relevant stakeholders have access to the correct, up-to-date information about the completed project. This includes:

• Maintenance schedules for newly built facilities or equipment
• Warranty details, manuals, and operational guides
• Performance benchmarks and expected operational outcomes

By embedding these elements into the SAP system, teams can also set up alerts or task assignments to ensure that operational readiness checks are completed on time, and that any immediate post-handover issues are flagged and resolved quickly.

A structured approach to completion and handover ensures that the mining team doesn’t just deliver a project—it sets the stage for efficient, ongoing operations. Furthermore, it ensures compliance with accounting and regulatory standards, making project closure both a financial and operational success.

The importance of structured processes cannot be overstated in the mining sector, where every phase of the project, from initial design through to operational readiness, impacts both the bottom line and long-term viability.

Strengthening Project Controls for Mining Capital Projects with SAP

Successfully managing capital projects in the mining sector requires more than just careful planning; it demands visibility and seamless integration across the entire project lifecycle. The challenges of cost overruns, scope creep, and compliance issues can derail even the most well-planned initiatives. However, with advanced workflows and reporting capabilities, mining project managers can bridge these gaps, transforming how projects are executed from budgeting, approval through to closeout.

Through automation, tracking, and a structured approach to budget control, mining companies can ensure that projects stay on track, reduce administrative burdens, and increase overall compliance. Lessons from real-world case studies demonstrate the tangible benefits of this approach: faster approvals, lower operational costs, and improved governance. With accurate, up-to-date data at every step of the process, teams gain the ability to make informed decisions, address risks proactively, and ensure smoother handovers to operations.

Ultimately, embracing integrated, data-driven capital project controls with SAP being the single source of truth empowers mining teams to overcome common pitfalls and achieve greater efficiency, cost savings, and transparency. By focusing on project controls, mining companies can turn their capital projects into strategic assets that not only meet deadlines and budgets but also contribute to the long-term success and sustainability of their operations.