Engineering, cost references

The engineering costs, sometimes referred to as home office costs or contractor charges, include the costs of detailed design and other engineering services required to carry out the project ... 

In addition to the cost references listed in this table, the magazine Cost Engineering, published specifically on the subject of equipment specifications and costs, should be available to the design engineer. 

Certainly, corrosion has effects on economy, depletes resources and causes costly and untimely failures of plants, equipment and components. In 2002, National Association of Corrosion Engineers (NACE) refers that the total annual estimated direct cost of corrosion in the U.S. was 276 billion—approximately 3.1% of the nations gross domestic product (GDP) [2]. The present valuation of the annual cost of corrosion worldwide from World Corrosion Organization is U.S. 2.2 trillion, which is over 3% of the world s GDP [3]. 

Table 5.22 indicates the test references to be conducted on engines according to procedures established by the Coordinating European Council (CEC). Note that these are long-duration tests, some lasting dozens or even hundreds of hours and they are costly. 

Plastics. In the plastics industry, the term filler refers to particulate materials that are added to plastic resins in relatively large, ie, over 5%, volume loadings. Except in certain specialty or engineering plastics appHcations, plastics compounders tend to formulate with the objective of optimizing properties at minimum cost rather than maximizing properties at optimum cost. Table 2 fists typical plastic fillers and their uses. 

Table 9-42 presents information on some cost indices for the United States. Engineering News-Record updates its construction-cost index in March, June, September, and December. The Oil and Gas Journal gives the Nelson-Farrar refinery indices in the first issue of each quarter. The Chemical Engineering plant-cost index and Marshall and Swift equipment-cost index are given in each issue of the pubhcation Chemical Engineering. Derivation of the base values is referred to in the respective publications. 

This means the engineer should strive to do the best job he can on each estimate, and apply adequate factors to keep the cost conservative. All project costs seem to grow as the project matures. Few projects reduce in scope or cost as more information is developed. A Rand Corporation study documents these cost increases as plans mature (Reference 1). 

Corrosion resistance data lists on specific materials offered for sale. However the engineer must also consider mechanical and physical properties and, last but not least, the cost of the material, its fabrication and protection. Thus reference must be made to books, journals and data that provide this information. 

The contribution of each of these items to the total capital cost is calculated by multiplying the total purchased equipment by an appropriate factor. As with the basic Lang factor , these factors are best derived from historical cost data for similar processes. Typical values for the factors are given in several references, Happle and Jordan (1975) and Garrett (1989). Guthrie (1974), splits the costs into the material and labour portions and gives separate factors for each. In a booklet published by the Institution of Chemical Engineers, IChemE (1988), the factors are shown as a function of plant size and complexity. 

Almost all the information on costs available in the open literature is in American journals and refers to dollar prices in the US. Some UK equipment prices were published in the journals British Chemical Engineering and Chemical and Process Engineering before they ceased publication. The only comprehensive collection of UK prices available is given in the Institution of Chemical Engineers booklet, IChemE (2000). 

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