17 replies to this topic

[Steve Goch]

I am doing my final project (plant design for producing power ethanol). I have done all the material & energy balances and have design all equipment. However, I am stuck in estimating cost of equipment like xchangers, condensors,distillation column, fermentors...etc, becoz I can't escalate the costs I gat for same equipments in 1998.

Could someone please help me in finding equipment cost index for 2011?

regards
Steve

[breizh]

Unfortunately not updated but could help .
Go to your library and check Chemical engineering Newspaper.

Hope this helps
Breizh

[kkala]

Unfortunately M&S Equipment cost index does not seem to be free, see http://www.marshalls...r-cd-combo.aspx. The indexes in attached Economic_Indicators1.pdf cover the period 2002-2009; it would be very helpful to trace indexes referring to 1998 (e.g. same source published in 2003 - 2004 would contain it). Some members could probably do it. Of course current index (mid 2011) would also help, but this is rather fine tuning and could be replaced by inflation rate.
Generally it is conservative to consider general inflation index as escalation for equipment cost. General inflation is grossly composed of inflation of materials (less than the average) and inflation of labor (higher than the average). I have seen budgets using general inflation to escalate prices, anyway. And inflation index of USD (or probably for other currencies) can be easily found in WWW, e.g. {url]http://146.142.4.24/cgi-bin/cpicalc.pl[/url].
Exchange rates are also affected by inflation. Presented indexes are reported in US$. Better to convert estimated US$ prices to current prices (mid 2011) and use current exchange rate to convert it in local currency, if needed. Import freight and tax will be added to the capital equipment cost.
It is noted that installed cost should include erection, civil works, supporting structures, interconnecting piping, etc, increasing the purchased equipment cost by an important factor (1.5-3,5, depending on equipment & plant).
Economic indexes and clarifications can be found in http://people.clarks...gn/refcosts.htm.

Edited by kkala, 21 July 2011 - 09:30 AM.

[MihaxD]

its wonderful

[breizh]

This link could support cost estimation and financial analysis:

http://hydrogen.pnl....?canprint=false

Breizh

Edited by breizh, 08 December 2011 - 06:13 AM.

[Murtalhas]

Hope this helps

http://pt.scribd.com...2271/CEPCI-2011

[kkala]

1. Link by breizh is useful for many calculations on finance. "Levelized cost" seems to be applied mainly for power stations; in some way it represents total plant capital + operating cost, if paid by annual installments during all years of project life http://teachmefinanc...lized_cost.html and http://energytechnol...ower-or-energy/.
The "Price year adjustment" is based on USA gross domestic product inflation, which may practically be same as general inflation reported in previous posts. Specific indexes, like M&S equipment cost index, are expected to be more precise for the case. Nevertheless general inflation index has been used here to estimate present value of equipment bought years before (valuations).
2. Link by Murtalhas supplies "Chemical Engineering Plant Cost index" and "M&S equipment cost index" for the 8 past years (2003-2010). We have to look at older prints of "Chemical Engineering" for years before 2003. Data on these indexes are not free in the web (www.che.com/pci).
Based on this, we have to "guess" price increase only for one year (2011 from 2010).
We can also see that mentioned indexes can drop at periods of economic uncertainty (2009 or 2010), making projections to 2011 difficult. For 2009, 2010 economic indexes are clearly more exact than inflation index.

Edited by kkala, 09 December 2011 - 04:04 AM.

[cheforum]

Thanks for the above info. I'm looking for a somewhat different number...the annual operating cost (utilities etc) of a typical chemical plant, based on the installed capital cost. In other words, as a real rough number, if I have $1,000,000 of installed equipment (typical vessel, pumps, filters, etc) would I expect to spend 1X, 5X, 10X that value per year on utilities to operate it? Anyone have a feel for this?

[kkala]

.... I'm looking for a somewhat different number the annual operating cost (utilities etc) of a typical chemical plant, based on the installed capital cost. In other words, as a real rough number, if I have $1,000,000 of installed equipment (typical vessel, pumps, filters, etc) would I expect to spend 1X, 5X, 10X that value per year on utilities to operate it? Anyone have a feel for this?

A rough capital estimate of a whole plant can be based on its turn over ratio, representing annual sales to capital investment. This ratio is more or less constant for every sort of industry, e.g. 0.74 /y for alumina plants. So capital cost of a plant to produce 700000 t/y alumina (sold at a price of 1200 US$ /t), would roughly be 700000*1200/0.74 = 1135 MM US$ (MM=million US$). Of course the inverse can be also estimated, that is an alumina plant of 1135 MM US$ capital cost would have anual sales of 1135*0.74 = 840 MM US$. Assuming 8% profit margin on total product cost, the latter is 840/1.08 = 778 MM US$. And as a rough approximation, utility costs for usual chemical processes amount to 10-20% of total product cost (*), so utilities cost would be 78-156 MM US$ /y.
In brief annual utilities cost = capital cost *turn over ratio/(1+profit margin)*0.15, where 0.15 can vary from 0.1 to 0.2. Figures realistic for the specific industry would increase precision of this rough estimate.
Suppose that capital plant cost is 1 MM US$. Depending on the kind of the plant, annual sales would be 0.21 to 8.30 (1.0) MM US$. For 8% profit margin, utilities cost could be 0.019 to 1.5 (0.14) MM US$ /y . Values in parenthesis represent some average, however the variation is huge for factories producing different products.
Attached "toratio.xls" gives data on mentioned turn over ratios for several Chemical factories. Capital cost estimate from turn over ratio has not been met in modern books.

(*) From M Peters, K Timmerhaus "Plant design and Economics for Chemical Engineers, McGraw-Hill, 1980, Chapter 5 (Cost Estimation), Utilities (p. 197).

Attached Files

•  toratio.xls   24.5KB   215 downloads

[cheforum]

Thanks so much ... that's very helpful

[breizh]

Good day All,

Please consider this resource to understand cost estimate methodologies .

It should help .

Breizh

[breizh]

Plant cost index regression from 1950 till 2005 + CEI 2008/2009/2010

Hope this helps

Breizh

[rosneft]

Hi,

Does anyone know if there are any sources for finding the capital cost required for styrene plants (from previous builds rather than a calculated estimate)?

Also are there a source for upto date location factors?

Many Thanks

[gpcshf]

thanks

[JVogel]

Hi all,

Hope it's not too late, I think it could help you:

http://www.slideshar...struction-index

This free plant cost index has current and forecast values and it's updated monthly.
I found it in Wikipedia.

[mmasinachi]

Am new here. Am grateful for the help i received here. TANKS! @ ALL

[kkala]

Does anyone know if there are any sources for finding the capital cost required for styrene plants (from previous builds rather than a calculated estimate)?
Also are there a source for upto date location factors? Many Thanks

Hydrocarbon Processing magazine published a list of all projects, along with their estimated cost. I have used the data for a polyethylene plant as student (1971), they would also publish data about styrene (monomer) plants. I have not verified whether such data is published now (the magazine has been very slim), but most probably they do. http://www.cheresour...cess-literature '> http://www.cheresour...cess-literature .
Chemical age (if still in circulation) could be another source to search.

[Mehdi Alizad]

Is there anyway to estimate the operating cost of an sweetening unit operating with amine (MDEA)? which contains absorber, desorber, exchanger, cooler, heater...? any help?

Thanks