Project manager doesn’t work with Merged Clips
I already have a case open with Adobe and they say they’re looking into it, and they also suggested I post it here, so:
When performing a Project Manage consolidation, you will receive an “Unknown error” message if you have any Merged Clips in your timeline. This is yet another reason why you should never use Merged Clips in a professional environment. (The other major flaw is that Merged Clips also eradicates sound metadata, making the handover to the Sound department an embarrassing nightmare #basedonatruestory)
So to sum up: never use Merged Clips.

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Jonah Walker commented
Yes please fix this ASAP. Don't want to export an XML and re-import to get audio back with correct names and metadata. And if that is the case, the info must still be in there, fix Merge Clips please!
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paul wedel commented
The official response of Adobe, where they admit merged clips doesn’t work with project manager:
“ This email is in reference to open case regarding issue that you were facing with Adobe Premiere Pro. Project manager will not be able to process the projects which contains Merged clips as a merged clip is not a “real” clip. Instead it looks real but is simply two clips linked so that their audio is in sync. This also applies to the Dynamiclly linked clips
We’ve found these self-help articles if you’d like more information about your issue:
https://helpx.adobe.com/in/premiere-pro/using/copy-consolidate-transcode-archive-project.html “So again to sum up, never use merged clips in Premiere Pro if you’re in a pro environment.