RAPID CAPITAL COST ESTIMATING METHODS

RAPID CAPITAL COST ESTIMATING METHODS

1. Historical costs
An approximate estimate of the capital cost of a project can be obtained from a knowledge of the cost of earlier projects using the same manufacturing process. This method can be used prior to the preparation of the flow-sheets to get a quick estimate of the investment likely to be required.

The capital cost of a project is related to capacity by the equation

C2 = C1x (S2/S1)^n

where

C2 = capital cost of the project with capacity S2,
C1 = capital cost of the project with capacity S1.

The value of the index n is traditionally taken as 0.6; the well-known six-tenths rule. This value can be used to get a rough estimate of the capital cost if there are not sufficient data available to calculate the index for the particular process. Estrup (1972) gives a critical review of the six-tenths rule. Garrett (1989) has published capital cost-plant capacity curves for over 250 processes.

2. Step counting methods

Step counting estimating methods provide a way of making a quick, order of magnitude, estimate of the capital cost of a proposed project. The technique is based on the premise that the capital cost is determined by a number of significant processing steps in the overall process. Factors are usually included to allow for the capacity, and complexity of the process: material of construction, yield, operating pressure and temperature.
A number of workers have published correlations based on a step counting approach: Taylor (1977), Wilson (1971). These and other correlations are reviewed and compared in the Institution of Chemical Engineers booklet, IChemE (1988). Bridgwater, IChemE (1988), gives a developed relatively simple correlation for plants that are predominantly liquid and/or solid phase handing processes. His equation, adjusted to 2004 prices is: for plant capacities under 60,000 tonne per year:

C = 150,000 N (Q/s)^0.30               (1)


and above 60,000 t/y:

C = 170 N (Q/s)^0.675
               (2)

where C = capital cost in pounds sterling
N = Number of functional units
Q = plant capacity, tonne per year
s = reactor conversion

Reactor conversion is defined as:

s = mass of desired product / mass reactor input

Timms, IChemE (1988) gives a simple equation for gas phase processes; updated to 1998:

C = 9000 N Q^0.615
               (3)

where the symbols are the same as for equations 1 and 2.
In US dollars

C0 = 14,000 N Q^0.615                (3a)

Where C0 = captial cost in US dollars