Detailed Cost Estimate

This difference of 40% could partially be due to different scopes. If storage and shipping were not considered then the cost of the plant would be reduced to 3,140,000. The other possibility could be that the estimate is low. An error of this size, however, need not be surprising because very little information is needed to obtain the estimate. 

The major disadvantage of this method is that no cost information has been published and so anyone wanting to use it must develop his own data. This is time-consumming and hence expensive. Once data are developed, this method could produce more accurate results than any except the detailed cost estimate. 

This type of estimating is used by contractors who are bidding for a given job. If they are wrong they will not make any profit. It is also used by companies who want to keep a close control on costs during the construction phase. 

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Detailed Cost Estimate Unit Cost Ion Exchange Com- ments RO Comments... 

In the detailed design stage, everything must be specified. Each phase of the preliminary design must now be done in much more detail. The flow sheets develop into piping and instrument diagrams. The duty requirements for a piece of equipment become a specification sheet. The layout drawings may be replaced by a scale model, and a construction bid or detailed cost estimate is obtained to verify the previous cost estimate. 

The approximate total cost for remediation of a site with 95,000 yd (73,000 m ) of contaminated soil over a 2-year period was 4,401,120, or 46/yd ( 60/m ). Costs also were calcnlated for use of the steam-enhanced recovery process (SERP) at a similar site of the same size and contamination profile under what might be considered typical operation conditions. These costs were estimated to be abont 3,375,910, or approximately 36/yd ( 47/m ) (D10949J, p. 37). Detailed cost estimates for SERP may be fonnd in Section 3 of D10949I see Case Study 1 in the reference for more information on the SERP demonstration that served as the basis for these costs. 

The U.S. Environmental Protection Agency (EPA) has published detailed cost estimates for the CF systems process and the Carver-Greenfield process, which include technology-specific costs and a breakdown of site-specific costs. In estimating costs for the CF Systems Process, the U.S. EPA postulated the following scenarios ... 

Based on information from the Eco Waste commercial pilot facility in 1995, costs for a full-scale SCWO unit were estimated to be 10 to 20 cents per gallon of waste treated (D11868N, p. 3). Detailed cost estimates are provided for the Eco Waste system (T0877), the Foster Wheeler system (T0314), and the General Atomics system (T0329). 

Once the basic execution decisions have been reached, the long deliveries determined, the MPS prepared, and the appropriation estimate completed, the firm execution plan can be prepared. The plan must include sufficient execution details and schedule information to become the baseline for an in-house progress monitoring system. Such a plan can be prepared with a reasonable effort from the information contained in a Phase 1 design package and a preliminary semi-detailed cost estimate like the one in Appendix L. 

A semi-detailed cost estimate prepared with the procedures and guidelines included in Chapter 19 could easily be dissected into a multitude of comprehensible construction activities that could be integrated, at the Project Manager s option, into a manageable number of discretely sized units. Every single activity could be assigned consistent relative values based on field hours... 

The activities breakdown parallels the preliminary semi-detailed cost estimate in Appendix L and the Master Project Schedule illustrated in Appendix E. 

The following information, developed during Phase 0 is available to the Estimator and is sufficient for the preparation of a preliminary type Semi-Detailed Cost Estimate ... 

The detail design phase will include the preparation of detail drawings and product specifications. A bill of materials must be prepared along with a detailed cost estimate. A final design review is conducted before releasing all drawings to be manufactured. 

Today, process simulation/project evaluation/finan-cial evaluation software is available that can be applied to a wide variety of projects in the chemical and petroleum industries. The most sophisticated evaluation systems contain built-in design systems, scheduling systems, and up-to-date knowledge bases of international cost and work-hdCif mdd dsV Software can work from a bri outline of a project s scope and automatically develop design details in the early stages of a project. Software packages available can produce detailed cost estimates within -5% to +14% of actual cost [6]. 

The BBRP license and technology is available for a license issuance fee of 3,000 and a royalty fee equal to 1/4% of the gross sales price of the licensed products that are used, leased or. sold by or for the licensee [Rutgers]. After the license agreement royalties reach 25,000, no more royalty fees will be due. The license issuance fee includes a technology transfer manual which provides detailed equipment and process descriptipn, process economic estimates, safety and health parameters and quality control requirements and measurements. A detailed cost estimate was performed by CPRR for a 20 million... 

Define basic design including key components and detailed cost estimate. Continue supporting development plan. Prepare preliminary safety analysis report. Initiate site activities... 

Estimates of labor, equipment, material, and waste quantities Detailed cost estimates Resource-loaded D D schedules Environmental, safety, and health analysis Temporary (utility) service requirements R D/Technology development needs Permitting requirements... 

When thinking about capital costs, it is important to think about a concept sometimes referred to as the present value of money or the opportunity cost of money. This fluctuates based upon inflation and interest rates. Let s think about it with a very simple example. Imagine that if you spent 100, you could build a plant that could generate 120 beyond cost in ten years. You might consider a profit of 20 to be attractive. This is a 20% return on your initial 100. However, you need to remember that because you spent the 100, it was not available for other investments. Had you been able to invest the money in a bond paying 7.2% interest, at the end of ten years, you would have 200. So by investing in a plant and making 20, you have lost the opportunity to make 100 profit in a bond. You have effectively lost 80 in opportunity cost. This example is oversimplified and needs to reflect current interest rates as well as risks both with alternative investments and with investments for the project, but serves to illustrate that a dollar in the present is more valuable than a dollar in the future. This needs to be factored into a detailed cost estimate. 

Other items such as interest, taxes and depreciation are also included in the detailed cost estimate. 

Detailed cost estimates are beyond the scope of this text. Such procedures are capable of producing accuracies in the neighborhood of + 5%. However, such estimates generally require significant time of engineering work. This type of analysis is designed to give the reader a basis for a preliminary cost analysis only. 

There are many tens to hundreds of process systems examined at the block diagram level for each process that makes it to the construction stage. Most of the processes initially considered are screened out before any detailed cost estimates are made. Two major areas dominate this screening process. To continue process development, the process must be both technically sound and economically attractive. 

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