4 replies to this topic

[skswami19]

I'm looking for a professional to estimate the costs of a small chemical plant we are putting up in Texas. We'll provide the process package, major and minor equipment list. Any recommendations?

[ankur2061]

skswami19,

You may not require to hire a specialist to do your cost estimation as a ball-park figure. You can do your own cost estimate by refering to Chapter 6, "Cost Estimation" from the book "Plant Design & Economics for Chemical Engineers" by Max S. Peters and Klaus D. Timmerhaus. This of course is conditional that the cost estimation be done by a person having a basic background of chemical engineering.

Regards,
Ankur

Edited by ankur2061, 11 July 2012 - 04:30 PM.

[kkala]

Stone and Webster (1993) and Brown Root (1998) had undertaken capital cost estimates of a local alumina project, where PIDs / bulk material estimates were already made (except few parts covered by lump sum bids). Accuracy of the estimate was probably 8%. Banks required economic data (IRR, etc) by reputable firms to supply a loan, at least in Europe of 1990s.
If you have prepared mainly flow sheets without layout drawings and bulk material estimate, I think probable accuracy of estimated capital cost would be ± 30% (*), on the condition that a cost estimator experienced on the specific industry is hired. The latter was important here, since specific applicable practices differ somehow from industry to industry (refineries, textiles, cements, fertilizers, pharmacuticals, etc). E.g. hazardous areas are important in refineries, clean rooms in pharmaceuticals, etc. The cost estimator should be familiar with them, as well as with applicable standards (e.g. API pumps or ANSI pumps, etc).
Applicable standards are better understood today, yet details and practices to be clarified in detail engineering should be known to some extent in advance by the cost estimator.
An engineer assisting the cost estimator in local prices (land, bulk materials, construction equipment and labor) would be also useful.
Of course much depends on how accurate your estimate has to be (purpose?). It could be by an experienced engineer of the company, but it would be hard to estimate accuracy of estimate. In said alumina project, original budget was ~60% of the 1993 budget (originally place of factory was not defined, but cost estimator had big experience in alumina projects). Delays, changes in design, unpredicted developments usually contribute to budget overruns, especially in big projects (like alumina). But this is limited in small, well organized projects.

(*) Fundamentals of cost engineering in the chemical industry, by H. C. Bauman, Reinhold 1964, Chapter 3, Fixed capital cost estimation.

Edited by kkala, 12 July 2012 - 03:23 PM.

[Mahesh@A&M]

Skswami19,

I recommend you read AACE (American Association of Chemical Engineers) recommended practices

1. 34R-05 basis of estimate
2. 36R-08 Development of cost estimate plans
3. Cost estimate classification system

You need to know what estimate level you are seeking (conceptual, feasibility, budget or capital authorization/definitive). Different level estimates require different levels of maturity of estimate input information.

If you know what level of estimate you are looking for and have sufficient deliverables to an engineering firm to do the job, then write Scope of Work and call few engineering firms ( there is no shortage of engineering firms in Houston,TX) for bid meeting.

Hope this helps.

Mahesh A&M

[ksmith]

I recommend you to try Knowledge Base. It is a free online encyclopedia regarding the chemical process technology description, but it also have indicators for plant cost estimation. It has a plant construction index, a plant location factor and a profitability index for the chemical sector.

here's the link to the pr I just saw http://www.slideshar...s-now-available

I hope it helps!