Estimating field costs

In the feasibility phase the project is tested as a concept. Is it technically feasible and is it economically viable There may be a number of ways to perform a particular task (such as develop an oil field) and these have to be judged against economic criteria, availability of resources, and risk. At this stage estimates of cost and income (production) profiles will carry a considerable uncertainty range, but are used to filter out unrealistic options. Several options may remain under consideration at the end of a feasibility study. 

A popular overall factor refinement, known as the Hand factor approach, uses a different factor to estimate overall costs for each class of equipment to cover all labor field materials, eg, piping, insulation, electrical, foundations, stmctures, and finishes and indirect costs, but not contingencies. Hand factors range from 4 for fractionating towers down to 2.5 for miscellaneous equipment. 

At the end of each month, the field cost engineer collects all current information on a detailed cost report form. As these are actual costs, they can be used to estimate future job costs to completion. Daily reports of unit-cost progress for concrete, excavation, masonry, steel, piping, and electrical work, etc., are then used to predict possible overruns or underruns for the various items. Analysis and comparison with the original estimate point out trouble spots for early attention. If an item is running into difficulty, it is red-flagged to the resident and projec t engineers for remedial action. 

The costs of a 10-acre, full-scale, gravel-based constructed wetland used to teat groundwater contaminated with explosive compounds were calculated based on the field demonstration at the U.S. Department of Defense s (DOD s) Milan Army Ammunition Plant near Milan, Tennessee. The estimated, site-specific costs of a 200-gal/min system that discharges effluent to surface waters were 3,466,000 in 1998 dollars. Amortization of these costs was estimated at 1.36 per 1000 gal of effluent for 10 years and 0.45 per 1000 gal for 30 years. Table 1 shows a breakdown of the site-specific estimate. Capital costs for a similar system with groundwater... 

For ROPE applications to tar sand mining, economic projections were published for capital costs and operating costs. Total capital costs were estimated at 53,336,000 and annual operating costs were estimated at 9,683,000. For the estimation of capital costs, direct field cost was estimated at 35,558,000. Other capital costs were based on percentages of that estimate. These cost estimates were based on mid-1989 dollars (D13089C, pp. 242-243). 

The regional weed control cost changes were expanded to include extra costs from drift damage and additional trips across the field when triazines were not used on no-till and mulch-till corn. The estimates of cost and yield... 

Definitive estimates. Definitive cost estimates are the most time-consuming and difficult to prepare, but they are also the most accurate. These estimates require preparation of plot plans, detailed flow sheets, and preliminary construction drawings. Scale models are sometimes used. All material and equipment is listed and priced. The number of labor hours for each construction activity is estimated. Indirect field costs, such as crane rentals, costs of tools, and supervision, are also estimated. This type of estimate usually results in an accuracy of 5%. 

Many different types of cost indexes are published regularly. Some of these can be used for estimating equipment costs others apply specifically to labor, construction, materials, or other specialized fields. The most common of these indexes are the Marshall and Swift all-industry and process-industry equipment indexes, the Engineering News-Record construction index, the Nelsotl-Fatrar refinery construction index, and the Chemical Engineering plant cost index. Table 3 presents a list of values for various types of indexes over the past 15 years. 

Estimating Field Indirects as a factor of labor costs is quite appropriate providing the factor recognizes the difference between direct labor costs and subcontract labor costs, which already include a large fraction of indirects as well as the impact of fast track schedules on field indirects. 

Estimate total field costs with factor in Table 19.35 and break down into construction disciplines with aid of Table 19.36. See example in Table 8.1... 

This factor is to be applied only to the equipment listed in the estimate under the "Materials" column that requires minimum or no assembly by the regular construction forces. Equipment that requires field assembly by the vendor, such as large storage tanks, large boilers, materials handling systems, and other complicated packages, should be listed in the estimate under the "Subcontract" column. The cost includes both materials and field costs. 

As mentioned in section 19.11 the total field cost factor (TFCF) can be modified and adapted to facilities that differ from those in the original study. The modified factor is developed by adjusting each of its cost components (see Table 19.36) to meet the requirements of specific cases. This approach can be very useful for conceptual estimating as well as for the quick checking of estimates prepared by others. 

BM factor method of cost estimation. Component costs within the BM are estimated as percentages (or factors) of the FOB cost. The factors differ depending on the type of equipment in the module and the alloys. Two types of factors have been developed (1) L + M factors to account for the FOB cost plus the materials and labor for the supports, concrete, electrical, process and utility piping, vents and sewers, insulation, and painting, plus labor for inspection and installation but excluding instruments and instrumentation. (2) Indirect cost factors for home office and field expense. 

A general agreement on piping layout can be reached speedily by this method of attack. Then piping drawings can be made up for use in cost estimating, field fabrication, and installation. 

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