Chapter five

Cost estimation

Chapter 5
Cost Estimate

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 Chapter five
Cost estimation

5.1 Equipment cost

5.1.1Storage tank of water Cost:

type = vertical tank

Capacity (s) = 50 𝑚3
from Table (5.3): Cost equipment . cost basis mid 2004
C= Constant =2400 $
index = 0.6
𝐶𝑒= c * 𝑠𝑛 = 2400 * 500.6= 25095.34$

Cost index in year 2000=100 from figure ()

Cost index in year 2004=111 from figure ()

The average increase in cost = 111−100 = 2.75

4

The cost index in 2025= 20 * 2.75 +111=168.75

Cost in 2025 = cost in 2004 * 𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2025

𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2004

Cost in year 2025 = 25095 . 168.75 = 38151.71$

111

For 5 storage tank = 4 * 38151.71

= 152606.84$

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Cost estimation
5.1.2Storage tank of Cl2 & C3H6 Cost:
type = floating roof
Capacity (s) = 50 𝑚3
from Table (5.3): Cost equipment . cost basis mid 2004
C= Constant =4350 $
index = 0.55
𝐶𝑒= c * 𝑠𝑛 = 4350 * 500.55= 37404 $

Cost index in year 2000=100 from figure ()

Cost index in year 2004=111 from figure ()

The average increase in cost = 111−100 = 2.75

4

The cost index in 2025= 20 * 2.75 +111=168.75

Cost in 2025 = cost in 2004 * 𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2025

𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2004

Cost in year 2025 = 37404 * 168.75 = 56864.18 $

111

For 3 storage tank = 3 * 56864.189

= 170592.56$

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Cost estimation
111

5.1.6Reactor cost :

Type of reactor =jacketed

Diameter =12𝑚3

𝐶𝑒= c * 𝑠𝑛
From Table (5.3)
C=15000 n=0.4
S= 12𝑚3
𝐶𝑒= c * 𝑠𝑛
= 15000 (12)0.4= 40528.80 $ in 2004

Cost index in year 2000=100 from figure ()

Cost index in year 2004=111 from figure ()

The average increase in cost = 111−100 = 2.75

4

The cost index in 2025= 20 * 2.75 +111=168.75

Cost in 2025 = cost in 2004 * 𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2025

𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2004

Cost in year 2025 = 40528.80 * 168.75 = 61614.73 $

111

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 Chapter five
Cost estimation

5.1.6Reactor cost :

Type of reactor =jacketed

Diameter =12𝑚3

𝐶𝑒= c * 𝑠𝑛
From Table (5.3)
C=31000 n=0.45

S= 12𝑚3
𝐶𝑒= c * 𝑠𝑛
= 15000 (12)0.4= 94840.37 $ in 2004

Cost index in year 2000=100 from figure ()

Cost index in year 2004=111 from figure ()

The average increase in cost = 111−100 = 2.75

4

The cost index in 2025= 20 * 2.75 +111=168.75

Cost in 2025 = cost in 2004 * 𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2025

𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2004

Cost in year 2025 = 144182. * 168.75 = 61614.73 $

111

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Cost estimation

5 . 1 . 7 heat exchanger of water cost:

Area = 82.3𝑚2

Pressure factor 14 bar =1.1

Material of construction = stainless steel for shell and tube side

Type factor ( flouting head )=1

From figure (D.2 )

shell and tube heat exchanger Bare cost = 27000$

Purchased cost = bare cost * type factor * pressure factor

=27000*1.1*1=29700$

Cost index in year 2000=100 from figure ()

Cost index in year 2004=111 from figure ()

The average increase in cost = 111−100 = 2.75

4

The cost index in 2025= 20 * 2.75 +111=168.75

Cost in 2025 = cost in 2004 * 𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2025

𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2004

Cost in year 2025 = 29700* 168.75 = 45152.02 $

111

For 3 heat exchanger = 3* 45152.02

= 135456.08$

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Cost estimation

5.1.8heat exchanger of E.O. cost:

Area = 73.25𝑚2

Pressure factor 14 bar =1.1

Material of construction = stainless steel for shell and brass

tube side Type factor ( flouting head )=1

From figure (D.2 )

shell and tube heat exchanger Bare cost = 24000$

Purchased cost = bare cost * type factor * pressure factor

=24000*1.1*1=26400$

Cost index in year 2000=100 from figure ()

Cost index in year 2004=111 from figure ()

The average increase in cost = 111−100 = 2.75

4

The cost index in 2025= 20 * 2.75 +111=168.75

Cost in 2025 = cost in 2004 * 𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2025

𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2004

Cost in year 2025 = 26400* 168.75 = 40.135.13 $

111

For 2 heat exchanger = 2* 40.135.13

= 80270.27$

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Cost estimation

5.1.9Cost of 1st distillation column :

Vessel cost
Material of construction =stainless steel
Height of column=8m
Diameter of column =3.515m
Operation pressure =1 atm

From figure ()
Bare cost of the vessel =50000$
Material factor=2 pressure factor=1
Purchase cost =bare cost × type factor × 𝑝𝑒𝑠𝑠𝑢𝑟𝑒 𝑓𝑎𝑐𝑡𝑜𝑟
Purchase cost=1×2×50000=100000$
Cost index in year 2000=100 from figure ()
Cost index in year 2004=111 from figure ()

The average increase in cost = 111−100 = 2.75

4

The cost index in 2025= 20 * 2.75 +111=168.75

Cost in 2025 = cost in 2004 * 𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2025

𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2004

Cost in year 2025 = 100000* 168.75 = 152027.02 $

111

Stage cost
Plate diameter=3.515
Number of plates =16
Material construction=stainless steel

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 Chapter five
Cost estimation
Plate type =sieve stage
From figure ()
Bare cost=1200$
Total cost of stage=1100×16=19200$
Cost index in year 2000=100 from figure ()
Cost index in year 2004=111 from figure ()

The average increase in cost = 111−100 = 2.75

4

The cost index in 2025= 20 * 2.75 +111=168.75

Cost in 2025 = cost in 2004 * 𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2025

𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2004

Cost in year 2025 = 19200* 168.75 = 29189.18 $

111

Cost total distillation=181216.20$

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Cost estimation

5.1.10Cost of 2nd distillation column :

Vessel cost
Material of construction =stainless steel
Height of column=6m
Diameter of column =2.5m
Operation pressure =1 atm

From figure (D.3)

Bare cost of the vessel =26000$
Material factor=2 pressure factor=1
Purchase cost =bare cost × type factor × 𝑝𝑒𝑠𝑠𝑢𝑟𝑒 𝑓𝑎𝑐𝑡𝑜𝑟
Purchase cost=1×2×26000=52000$
Cost index in year 2000=100 from figure ()
Cost index in year 2004=111 from figure ()

The average increase in cost = 111−100 = 2.75

4

The cost index in 2025= 20 * 2.75 +111=168.75

Cost in 2025 = cost in 2004 * 𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2025

𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2004

Cost in year 2025 = 26000* 168.75 = 39527.02 $

111

Stage cost
Plate diameter=5m

Number of plates =12

Material construction=stainless steel
Plate type =sieve stage
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 Chapter five
Cost estimation
From figure (D.4)
Bare cost=1100$
Total cost of stage=1100×12=13200$
Cost index in year 2000=100 from figure ()
Cost index in year 2004=111 from figure ()

The average increase in cost = 111−100 = 2.75

4

The cost index in 2025= 20 * 2.75 +111=168.75

Cost in 2025 = cost in 2004 * 𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2025

𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2004

Cost in year 2025 = 13200* 168.75 = 20067.59 $

111

Cost total distillation=59594.58$

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Cost estimation
5.1.5 Cost Of Absorption Column :
Material of construction = carbon steel
Column height = 6 m
Column diameter = 1.5 m
From appendix B figure (3.5)
Vessel cost in 2004 = 10000 $ pressure factor 1-5 bar =1
Material factor( c.s) = 1
Equipment cost in 2004= 10500
Packing height =5.01 m
Packing material = pall rings
From appendix B table (B-4)
Cost of packing material =1360 $/𝑚3
𝜋∗𝐷2
Volume of packing = ∗ 𝑃𝑎𝑐𝑐𝑘𝑖𝑛𝑔 ℎ𝑒𝑖𝑔ℎ𝑡 = 2.178 𝑚3
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Total cost of packing = 𝑣𝑜𝑙𝑢𝑚𝑒 * 1360 $/𝑚3

=2.178 𝑚3 * 1360 $/𝑚3 =2962.0 $
Total cost in 2004 = cost of packing + cost of vessel
=10000 + 2962.0 =12962 $
Cost index in 2004 = 111
Cost index in 2025 = 168.75
𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2025
Cost in 2025 = cost in 2004 *
𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2004
168.75
Cost in 2025 = 12962* = 19705 $
111

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 Chapter five
Cost estimation

5.1.13Cost of SCRUBBER column :

Vessel cost
Material of construction =stainless steel
Height of column=8m
Diameter of column =1.5 m
Operation pressure =1 atm

From figure ()
Bare cost of the vessel =7100$
Material factor=2 pressure factor=1
Purchase cost =bare cost × type factor × 𝑝𝑒𝑠𝑠𝑢𝑟𝑒 𝑓𝑎𝑐𝑡𝑜𝑟
Purchase cost=1×2×7100=14200$
Cost index in year 2000=100 from figure ()
Cost index in year 2004=111 from figure ()

The average increase in cost = 111−100 = 2.75

4

The cost index in 2025= 20 * 2.75 +111=168.75

Cost in 2025 = cost in 2004 * 𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2025

𝑐𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 2004

Cost in year 2025 = 14200* 168.75 = 21587.83 $

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Cost estimation

Table(5.1)Cost of equipment
Equipment Cost $

Storage tank of water 190758.56

Storage tank of E.O 113728.37
compressor 226258.18
Reactor 52389.95
Pump 28648.36
Heat exchanger of water 135456.08
Heat exchanger of E.O. 80270.27
Mixer 97580.71
Distillations 1ST 206756.75
Distillations 2ND 170270.26
Distillations 3RD 175135.12
Dryer1ST 25905.4
Dryer2ND 23746.62
Dryer3RD 21587.83
Total 1548492.46

5.2 Direct cost :

from table (5.4 ): Cost of direct and indirect
Direct cost = 3.6 * Equipment's cost
=3.6 * 1548492.46
= 5574572.86$

5.3 Indirect Cost

from table(5.4) : Cost of direct and indirect
= 1.44 * Equipment's a cost
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 Chapter five
Cost estimation
=1.44 *1548492.46
= 2229829.14 $

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Cost estimation

5.4 fixed Capital Investment (FC I):

FCl = Direct cost + indirect cast
= 5574572.86+ 2229829.14 = 7804402$

5.5 work Capital Investment (WCI):

WCI =15 % FCI
= 0.15 *7804402$
=1170660.3$

5.6 total Capital investment

total Capital investment = FCI + WCI
= 7804402+1170660.3=8975062.3$

5.7 Raw Material Cost

Propylene

Flow rate =5236537 Kg/Year

From table()
Cost = 0.6 $/ Kg

Total Cost =5236537 *0.6

Total Cost = 3141922.2 $/year

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 Chapter five
Cost estimation

Water

flow rate =331123077.17 Kg /Year

from table (5.5 )

Cost =0.01 $/ Kg

Total Cost =33123077.17 * 0.01

Total Cost =331230.771 $ /Year

Water

flow rate =13779797.3 Kg /Year

from table (5.5 )

Cost =0.2 $/ Kg

Total Cost =13779797.3 * 0.01

Total Cost =2755959.46 $ /Year

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Cost estimation

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Cost estimation

5.8 Utilities

Steam (for heat transfer equipment)

Flow rate =

(30.978+24.53+15.74+15.434+15.3)mol/h

=14967.072 ton /

year From table (5.5

) cost = 12 $ / ton

total cost =134013.6 * 12

= 1608163.2$ / year

5.9 operating Labor

Assume Process Plant requires approximately 100 employees

Assume the one employee monthly wage is =1500$

operating Cost of Labor = 100 *1500 *12 =1800000 $ / year

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 Chapter five
Cost estimation

5.10 Direct production cost

Variable Cost

From table (5.7)

Variable Cost = Raw material + Utilities + Miscellaneous Material

=1034579.68 +1608163.2+7646.22

=2650389.1$

Fixed Cost
Table (5.2) Summary of Fixed Cost
Function Cost in $
Maintenance=5% fixed Capital 390220.1
operating Labor 1800000
Laboratory cost = 20% operating Labor 360000
Supervision =20% operating Labor 360000
Plant overheads = 50% operating Labor 900000
Capital Charges =10% fixed capital 780440.2
Insurance =l% fixed Capital 78044.02
local Taxes =2% fixed Capital 156088.04
Royalties =1 % fixed capital 78044.02
Total 4902836.38

5.11 Direct Production cost

Direct Production cost = Variable cost+ fixed Cost
=2650389.1+4902836.38
=7553225.48 $ / Year

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Cost estimation

5.12 Research and development cost

Research and development cost = 20% Direct production cost
=0.2 * 7553225.48 = 1510645.096 $ /year

5.13 Annual production cost

Annual production cost = Direct production Cost + Research and development cost
= 7553225.48 + 1510645.096
= 9063870.57 $ / Year

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