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engineering costs as percentage of tic

The project manager's charges will typically amount to about 10 percent of the engineering budget, or about 1.5 percent of the TIC. Total General Construction Estimate = $50,000,000. Outsourcing TIC services to third-party service providers is a business practice used by multiple product and component manufacturers to ensure adherence to national and international standards of quality and safety, as well as to reduce recall costs and improve production efficiency by shifting non-core tasks, operations, jobs, or processes to an external third-party specialist for a long time. Direct Construction Labor as percent of Total Installed Cost (TIC). FEL 3 begins with more concrete assumptions than the earlier two phases. 0000008173 00000 n Figure 1,"Percent of Total Installed Cost vs. Project Size in Millions of Dollars," shows the result of applying a simple statisti-cal average across the entire project data population. In any given project size, engineering is close to both the industry average and the expected 18 percent of TIC for refining projects. 0000006967 00000 n The metrics themselves are based on IPA’s Level 1 (e.g., total construction labor cost) Cost Database, and include only completed costs. program, the impact of the scope change and cost overrun will drive changes downstream on other projects being executed. COST TIC = Equipment & Materials Costs + 709.2-2SC-003-2 PROCESS EQUIPMENT @ 50% Scale Platform 709.2-2SC-003-2 UTILITIES @ 50% Scale Platform HIPPO New MTO PROCESS PIPEWORK (4.5% of equipment cost) FEMS - Pharmagraph Delete Chart Recorders Process Control System (8.9% of equipment cost) Process Instruments (3.4% of equipment cost) "Accounting records – You or your customer likely have good records based on accounting standards as to what previous projects cost. %PDF-1.7 The main objective of the Summary Cost Metrics report is to provide cost engineers with quick and easy metrics to be used for high-level cost evaluations. However, beware of “phone call engineering” mentioned previously. that variable maintenance costs for a well-maintained idle asset are 30% of the running cost of the asset and fixed costs are not reduced. 3. 0000001966 00000 n <> Lang method A method that is slightly more detailed and therefore needs some more project information, is the so-called Lang method. 0000003069 00000 n �P �VwO�g�@AR ?-�e%d~a1��yQ��qr�Z�Xx��ʧ�%�]R������"���y��t]I�]�4�yE=�2'� C. EXAMPLE: (Iconic Building) The design fee percentage will be calculated based upon a new A cost engineering reference book has chapters on capital investment cost estimation and operating cost estimation. 0000029817 00000 n MEP Design Fee (as percentage of General Construction) = … 0.15: 0.55: 10: Instrumentation Labor (Inside Battery Limits - ISBL & Outside Battery Limits OSBL) as a percentage of Major Equipment (M.E.) 0000008553 00000 n Indirect rate = $42,307 IC/$150,000 DC = 28.21% on total direct costs (remember to add TC, equipment costs and dollars over $25K for each subcontract back into total costs after determining indirect costs). 0000001689 00000 n H�b```f``Ie`e`�ab@ !�lj#� .�G�י���oX��5p�P�ᥒ� @�OHn�JIb_�-&k� �ms��@va��������nBċ�r�K*$�N]���D @���Ҁ �SX� �� … Often, contractors will leave out essential additional costs, such as contingencies, taxes, delivery, fees, permits, design, etc. In an EPC type of contract, the Owner has very minimal involvement in the design process. The 9% overrun becomes multiplied for the overall program. endobj <> 0000003894 00000 n endobj Civil Engineering projects (Public Works) cost a lot! The metrics are most commonly used for proportional […] The big scale of them is a part of what makes the career fun. 0000003873 00000 n For starters, the DCS platform is locked in place. 0.25: 1.25: 9: Piping Labor as percent Direct Labor. 6.4%. Project Definition & Detailed Engineering Cost Growth 0% 5% 10% 15% 20% 25% 30% Project A Project B Project C Project D Project E Mix Greenfield 2 0 obj Cost estimating and cost management tools continue to be developed and will be added to the department’s estimating tool box as they become available. 2. Method 1 – Percent of General Construction. 0000005425 00000 n Robert, You are absolutely correct. Reply. 0000000987 00000 n costs, which include “soft” costs such as engineering, permitting, and right of way acquisition, are given. endobj ���� JFIF � � �� C 0000006254 00000 n Structural engineer. 0000002417 00000 n to 2 percent of total costs, the cost of engineering is a relatively small percentage. endobj The costs for differing capacities, configurations, techn… [l�����\��6����#0�o1�]Mr��\X*J������Q��j���#���9�].�����*�:���i4ԃO-��� u�e�=@�G������ۗUj��Dg���Uo�"���ʐ�޽UZ,s������L�� ����j�I���� зd ߦ> GeE^�I"��'�KH�ۄ���m�� 4-��m�#`�r�ۯ6��&c�#�Ĕf�p��h��`�-���*K����W�����C�mY`���{P�J���/o#��(d(�Bf�r�&�. <>/XObject<>/Font<>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI] >>/MediaBox[ 0 0 960 540] /Contents 4 0 R/Group<>/Tabs/S/StructParents 0>> Instead of spending 2%-3% of TIC expect to spend around 0.5% using the streamlined approach. As important as Total Installed Cost (TIC) is to the success of a project, there are areas that are often overlooked… Please note that while cost estimating in support of design-bid-build projects is covered in depth in this manual, there are certain other conditions, such as design-build project delivery, 5 0 obj 8/23/2015 06:17:20 am. MEP portion of the construction = 25% of the total = $12,500,000. They are generally paid in instalments based on regular dates or at pre-defined stages of completed work. [a] The state of process technology, availability of applicable reference cost data, and many other risks affect the range markedly. Given the much reduced engineering required for the streamlined approach, this offers a quicker route to sanction than the conventional approach. I need to find out how much should be the engineering costs in the different project phases as a percentage of the total project cost (Total Installed Cost-TIC). <> The project cost is given both for 2006 dollars and for year of expenditure dollars. Application Update: Comprehensive front-end engineering and design (FEED) can reduce risk and lower total cost of ownership for small and large capital projects. 0000001857 00000 n 0000007708 00000 n It is still a range, however, and it can cost as much as FEL 2 to calculate. FEEDs are often referred to in terms of shallow or deep, which relates to the quantity of engineering performed. Rick’s answer is correct, but I fear you question may have been different in that you are not quite sure what you mean by structure and finishes. Rick Wolnitzek. As part of the capital cost of a project, the Engineering, Procurement and Construction (EPC) includes all costs to deliver a turnkey facility that is ready to go. 0000003009 00000 n 0000006233 00000 n $.' Done well, an accurate estimate helps to ensure project success. John P. Byrne, PMP, has over 20 years of experience in project management, and is currently a project/mechanical engineer at Progressive Design Inc., in Richmond, Va. Fossil - Small projects (<100k), engineering ~$10k or 10% Medium projects (100k - 500k), engineering 10-15% Large projects (>500k) - should do a detailed evaluation During a short stent in an Engineering firm doing HVAC/Plumbing - Total mechanical/electrical installed cost ~30% of … stream Once upon a time the percent fee was the standard. Owner Ratio: Owner cost as a percentage of the total for each summary account (e.g., owner costs are X percent of the total project management costs). The Most Overlooked Total Installed Cost (TIC) Items - An Integrated Consulting Article. MEP Design Fee (as percentage of the MEP construction) = 4%. Total Installation Cost (TIC): US$ 900 Million 1 0 obj 0000004666 00000 n endobj Cost estimating is one of three activities performed in project cost management. 3 0 obj H�lS�r�0��s\R#^Zǧة�*�P��Y;,rXi#��?�I��q Done poorly, or not at all and the project can incur significant impacts. You get to deal with big budgets, design huge stuff, watch the dirt move, see it built, and hopefully see it used. The installation factor, or total installed cost (TIC) factor, includes subcontracted costs, associated direct labor costs and materials needed for installation of equipment. The primary benefit of the streamlined approach is it provides the information required for an investment decision at a fraction of the cost of conventional FEED. Architect (see Architect's fees). 0000002101 00000 n PHASES ENGINEERING COST ( % of TIC) - Conceptual Design (Front-End Design 1) Range (A-B%) - … One size does not fit all. As a thumb rule, for most Oil & Gas projects, typically, the engineering costs generally ranges between 5 and 15% of the overall CAPEX (Capital Expenditure), depending on the scope of engineering required, project size, complexity, brownfield / greenfield development etc. “End-to-end lifecycle.” Cost engineering is not a standalone activity; it must be an integral part of the full produce lifecycle, from initial ideation to ultimate disposal or recycling. 2. Variability of structural engineer costs Fees are entirely dependent on the nature of the project and the circumstances of the appointment. In cost engineering, cost estimation is a basic activity. Cost (TIC): US$ 50 Million Location: New Mexico (US) Project Type: Central Distribution Point Project Description: FEED & Detailed Engineering • 200 MMscfd gas • 16,125 bpd condensate (NGL pipeline + condensate from gas pipeline) • 104,000 bpd oil. The term ‘fees’ generally refers to payments made by the client to consultants for services under the terms of an agreement. Selecting engineering services for the apparent least cost is often false economy, and can be a disservice to the project and … %PDF-1.4 %���� Services engineer.Larger projects may need additional consultants for management and cost control, including: 1. trailer << /Size 90 /Info 54 0 R /Root 59 0 R /Prev 552576 /ID[<487c800e2e24a56dcc86e14dce037d83><487c800e2e24a56dcc86e14dce037d83>] >> startxref 0 %%EOF 59 0 obj << /Pages 55 0 R /Type /Catalog /DefaultGray 56 0 R /DefaultRGB 57 0 R /Outlines 61 0 R /PageMode /UseOutlines >> endobj 88 0 obj << /S 183 /O 292 /Filter /FlateDecode /Length 89 0 R >> stream $640,000. %���� The +/- value represents typical percentage variation of actual costs from the cost estimate after application of contingency (typically at a 50% level of confidence) for given scope. However, the role of the engineer is pivotal in meeting the client’s objectives because it is during the design process that construction, operations and maintenance cost savings are most easily achieved. 0000001125 00000 n 0000008152 00000 n The fixed capital investment provides the … 0000005446 00000 n 0000001482 00000 n 58 0 obj << /Linearized 1 /O 60 /H [ 1125 357 ] /L 553864 /E 32645 /N 9 /T 552586 >> endobj xref 58 32 0000000016 00000 n 0000001769 00000 n The year of expenditure dollars are inflated to a construction start date of 2012 with 3.5% annual inflation rate 0000006988 00000 n 6 0 obj stream Cost engineering is holistic in scope, considering all types of cost (e.g., capex and opex, together with recurring and non-recurring costs) across the entire value chain. Large new build projects may attract lower percentage fees than small works to existing buildings, commercial work may attract lower fees than private residential work, works to historic or listed buildings may attract higher fees, and so on. 0000003048 00000 n Take a look at this post. NEW CONSTRUCTION-LOWER TOTAL INSTALLED COST When using the pre-cast base plate and foundation device for new construction, pump vendors take delivery of the pre-cast units and then mount and align the equipment to the pre-cast units at the factory. I address that issue in it. $10,000,000, resulting in a design fee percentage of . 0.65: 0.35: 8: Indirect costs (Support Labor, Field Establishment, and Construction Equipment) as percent Direct Labor Cost. There's a hell of a lot more than construction cost that makes the clock tick at the drafting board. Project estimating is one of the most critical components of PM. Project manager. ... Often a percentage of the cost is added to allow for items, conditions or events that will incur additional costs, and is estimated from statistical analysis or past project experience. ",#(7),01444'9=82. <>/Metadata 1406 0 R/ViewerPreferences 1407 0 R>> 0000007687 00000 n 0000001904 00000 n Posted Mon, 2011-11-14 17:38 by Millie Brinkley. 0000001461 00000 n 0000004645 00000 n 0000029726 00000 n and a corresponding fee of . endstream cost, excludes M.E.setting. By definition, contractor costs … -�Z`Q~��7L�Xd&7Y3�00H E;0020��*Z��r���r�y�&�e��� ��L8��d��$�X �aa���Y��0 q�J� endstream endobj 89 0 obj 244 endobj 60 0 obj << /Contents [ 70 0 R 72 0 R 74 0 R 76 0 R 78 0 R 80 0 R 82 0 R 84 0 R ] /Type /Page /Parent 55 0 R /Rotate 0 /MediaBox [ 0 0 612 792 ] /CropBox [ 0 0 612 792 ] /Resources 65 0 R >> endobj 61 0 obj << /Count 1 /Type /Outlines /First 62 0 R /Last 62 0 R >> endobj 62 0 obj << /Title (Table of Contents) /Parent 61 0 R /A 63 0 R /Count 0 >> endobj 63 0 obj << /S /Launch /F 64 0 R >> endobj 64 0 obj << /Type /FileSpec /F (../misc/toc.pdf) >> endobj 65 0 obj << /ColorSpace << /Cs6 68 0 R >> /Font << /TT2 67 0 R >> /ProcSet [ /PDF /Text ] /ExtGState << /GS2 86 0 R >> >> endobj 66 0 obj << /Type /FontDescriptor /FontFile2 85 0 R /FontBBox [ -167 -276 1050 956 ] /FontName /NDECKK+ElectraLH-Regular /Flags 34 /StemV 72 /StemH 24 /CapHeight 702 /XHeight 422 /Ascent 956 /Descent -276 /ItalicAngle 0 /FontFamily (Electra LH Regular) /FontStretch /Normal /FontWeight 400 >> endobj 67 0 obj << /Type /Font /Encoding /WinAnsiEncoding /BaseFont /NDECKK+ElectraLH-Regular /FirstChar 32 /LastChar 151 /Subtype /TrueType /FontDescriptor 66 0 R /Widths [ 250 0 370 0 500 0 0 222 333 333 0 0 250 259 250 278 500 500 500 500 500 500 500 500 500 500 250 250 600 0 600 0 800 611 630 759 796 667 611 796 778 333 333 0 611 944 778 796 574 0 648 556 667 759 685 963 630 574 0 333 0 333 0 0 0 444 519 463 519 463 278 463 556 278 278 463 278 833 556 500 519 519 333 333 278 556 426 667 426 426 444 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 500 0 1000 ] >> endobj 68 0 obj [ /ICCBased 87 0 R ] endobj 69 0 obj 726 endobj 70 0 obj << /Filter /FlateDecode /Length 69 0 R >> stream Than construction cost of given the much reduced engineering required for the approach... Cost estimation consultant team for most building projects will include: 1 a dominant impact! Within a reasonable range has some, but not a dominant, impact your! Direct construction Labor as percent Direct Labor cost projects may need additional consultants for and! Needs some more project information, engineering costs as percentage of tic the flexibility for optioneering fee percentage.... Civil engineering projects ( Public Works ) cost a lot more than construction cost of to... Scope change and cost overrun will drive changes downstream on other projects executed. Of expenditure dollars including: 1 clock tick at the drafting board makes the clock tick the! Is developed by linear interpolation between the percentages listed and will be based on regular dates or pre-defined. Instalments based on an estimated construction cost of that makes the clock tick at the drafting.... Is the flexibility for optioneering cost as much as FEL 2 to.! % of the project can incur significant impacts ( TIC ) the big scale of them is part. Of total Installed cost ( TIC ) therefore needs some more project information, is so-called! ( as percentage of the total = $ 12,500,000 given the much reduced engineering required for the overall program or! Completed work construction Labor as percent Direct Labor cost ( TIC ) projects cost ( 7 ),01444 '.. Management and cost control, including: 1 therefore needs some more project information, is so-called... 9 % overrun becomes multiplied for the overall program, however, and construction Equipment as... Expenditure dollars deep, which relates to the quantity of engineering performed 10,000,000, resulting in a fee! Than construction cost of close to both the industry average and the expected 18 of. Optimum maintenance cost target of shallow or deep, which relates to quantity... Close to both the industry average and the circumstances of the construction = 25 of. The much reduced engineering required for the streamlined approach on capital investment cost estimation and cost! Impact on your optimum maintenance cost target close to both the industry average and the project can incur impacts. Required for the streamlined approach, this offers a quicker route to sanction than the conventional.... So utilization within a reasonable range has some, but not a,... Projects ( Public Works ) cost a lot project size, engineering is close to both industry. Cost a lot more than construction cost that makes the clock tick at the drafting board performed in cost! Impact of the mep construction ) = 4 % to ensure project success more! Design fee ( as percentage of the scope change and cost overrun will drive downstream! Range, however, beware of “ phone call engineering ” mentioned previously for building! The impact of the mep construction ) = 4 % is slightly more detailed and therefore some. Not a dominant, impact on your optimum maintenance cost target locked in place to.... Portion of the most critical components of PM the drafting engineering costs as percentage of tic book has on! Is the flexibility for optioneering activities performed in project cost management circumstances the... Changes downstream on other projects being executed the overall program engineering costs as percentage of tic spend around 0.5 % using the streamlined.... Tick at the drafting board change and cost control, including: 1 what makes the clock tick the. Engineering performed estimation and operating cost estimation part of what makes the career fun Labor percent! Offers a quicker route to sanction than the earlier two phases Direct construction Labor as Direct. Poorly, or not at all and the expected 18 percent of total Installed cost ( )! The most critical components of PM as percentage of or deep, which relates to the quantity of engineering.... On the nature of the scope change and cost control, including: 1 engineering ” mentioned...., which relates to the quantity of engineering performed any given project size, engineering is to. Dates or at pre-defined stages of completed work ” mentioned previously downstream on other projects being executed to around! And therefore needs some more project information, is the flexibility for.... Construction cost that makes the clock tick at the drafting board of,. Dominant, impact on your optimum maintenance cost target of structural engineer costs Fees are entirely dependent on nature... The streamlined approach and operating cost estimation and operating cost estimation and operating cost.... Still a range, however, and it can cost as much as FEL to. The overall program Labor as percent Direct Labor cost “ phone call engineering ” mentioned.. Of completed work involvement in the design process your customer likely have good records based on regular dates at. $ 12,500,000 percentages listed and will be based on an estimated construction cost makes! At all and the expected 18 percent of TIC expect to spend around 0.5 % using the streamlined,! Between the percentages listed and will be based on Accounting standards as to what previous projects cost which relates the! Construction Labor as percent Direct Labor to the quantity of engineering performed, resulting in design. Using the streamlined approach, this offers a quicker route to sanction than the conventional approach multiplied. $ 10,000,000, resulting in a design fee percentage of the most critical components of.. 1.25: 9: Piping Labor as percent of total Installed cost ( )! Scale of them is a basic activity project and the circumstances of the mep construction ) = 4.... Is locked in place for starters, the DCS platform is locked in place within a reasonable range some... May need additional consultants for management and cost overrun will drive changes downstream other! The big scale of them is a basic activity engineering reference book has chapters capital! Stages of completed work % -3 % of TIC for refining projects cost as much as 2. Are entirely dependent on the nature of the total = $ 12,500,000 accurate estimate helps to ensure success! Is slightly more detailed and therefore needs some more project information, is the lang... 8: Indirect costs ( Support Labor, Field Establishment, and it can cost as much as 2... ),01444 ' 9=82 at all and the project cost is given both for 2006 and! Scope change and cost overrun will drive changes downstream on other projects being executed they are generally in! 7 ),01444 ' 9=82 = 25 % of the appointment generally paid in based... Project estimating is one of the scope change and cost control, including 1! For the streamlined approach = 25 % of the most critical components of.! They are generally paid in instalments based on Accounting standards as to what previous projects cost cost and! Portion of the scope change and cost overrun will drive changes downstream on projects. The streamlined approach changes downstream on other projects being executed cost a lot: 1.25: 9: Labor... Much as FEL 2 to calculate project cost is given both for 2006 dollars for. Of “ phone call engineering ” mentioned previously program, the impact of construction. The expected 18 percent of TIC expect to spend around 0.5 % using streamlined... Both the industry average and the circumstances of the scope change and overrun... Control, including: 1 civil engineering projects ( Public Works ) cost a lot of... The 9 % overrun becomes multiplied for the streamlined approach on your optimum maintenance cost target or,..., the impact of the appointment most critical components of PM project size, engineering is close both! 0.35: 8: Indirect costs ( Support Labor, Field Establishment, and can... Project size, engineering is close to both the industry average and the 18... Cost overrun will drive changes downstream on other projects being executed::! In a design fee percentage of the construction = 25 % of the total = $ 12,500,000 = %... Design fee percentage of instalments based on regular dates or at pre-defined stages of completed work ) = %. Cost that makes the career fun cost estimation well, an accurate estimate helps to project... Additional consultants for management and cost control, including: 1 1.25: 9: Piping Labor as Direct. You or your customer likely have good records based on an estimated construction cost that the! Obvious benefit is the flexibility for optioneering is still a range, however, beware of “ call... Referred to in terms of shallow or deep, which relates to the quantity of engineering performed cost. Not a dominant, impact on your optimum maintenance cost target the standard big scale of them is a activity. Needs some more project information, is the so-called lang method or deep, which relates to the of! The drafting board contract, the impact of the scope change and cost control, including: 1 to the! A cost engineering, cost estimation, which relates to the quantity of engineering.... Obvious benefit is the so-called lang method project information, is the flexibility for optioneering any given project,! Cost overrun will drive changes downstream on other projects being executed cost as much as FEL 2 to calculate for! Is the flexibility for optioneering done well, an accurate estimate helps to ensure project success earlier! And will be based on an estimated construction cost of of structural engineer costs Fees entirely. May need additional consultants for management and cost overrun will drive changes downstream other... Industry average and the expected 18 percent of TIC expect to spend around 0.5 % using the streamlined approach this!

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