This section of this chapter encompasses general data / “rules of thumb” for preparing, benchmarking and auditing all types of capital cost estimates and project execution plans. The assortment of data includes the following:
1. Summary and overall project capital cost breakdown refer to Table A 3 1 2. Historical refinery / process related project cost breakdowns ditto
3. Historical home office (EPC engineering firm) man-hour breakdown 4. Bulk Material cost breakdown
5. Construction man-hour and craft breakdowns 6. Major Equipment Costs
7. Construction in-directs breakdown and percentage refer to A 3 1 8. Engineering benchmarking standards
9. Various Conceptual construction installation units 10. Various Conceptual construction material unit costs
This above mentioned data can offer guidance in reviewing / auditing scopes of work, execution plans, home office staffing or field man-power levels, reviewing claims and potential cost over-under runs. Representative cost and man-hour breakdowns can be useful in reviewing current estimates or considering and reflecting on historical norms.
The listing indicated is an overall breakdown of project costs, the data is based on historical data for “process” type projects built in North America described earlier and shown on table A.3.1, on a sub-contractor basis, during the period 1995-2001. When only a total installed cost (T.I.C.) value is known, this breakdown can be valuable in providing overall basic data points for a rapid evaluation of engineering, procurement and construction efforts that were / or will be required. The cost breakdown covers the following major categories.
• Major Equipment
• Materials (Bulks / Commodities)
• Labor Costs
• Detailed Engineering and Procurement Activities (EPC Data)
• Indirect Cost Elements
The capital project summary indicated in Section A 3 Table (5) has an estimated overall T.I.C. cost of $35.689 million. From Table (5). Outside Engineering / Design firm is 10.23% or $3,109,000. By a further analysis / hypothesis assume that the Outside Engineering all-in cost (billing rate) is $69 / hour, therefore we can calculate the total number of engineering man-hours is as follows. Consideration should be given to the fact that specific cost items such as CAD machines, computers etc, are included in
$3,109,000 value or are included in the $69 / hour billing rate.
• Number of EPC H.O. man-hours = $3,109,000 = 45,058 $69
If we knew that the engineering effort was needed to be complete in eight months, we could determine the peak manpower level, or the approximate number of EPC home office staff required to get the work effort completed.
• Number of engineering man-hours = 45,058 = 32.6 EPC H.O. staff (average) 8 Months x 173 m h’s / month
This number would need to peak at possibly 50 – 65 at the mid-point of the detailed design effort.
• The number of detailed design hours per M.E. items = 45,058 = 523 man-hours 86 M.E. items
From the table A.3. (5), direct field labor costs are $8,142,000 the direct field cost hourly rate is $36 / hr.
• Number of field man-hours = $8,142,000 = 226,166 man hours $36 / hour
If we knew that the construction effort was planned too be completed in fourteen months, we could determine the average manpower level, or the approximate number of
construction workers required too complete the work effort.
• Number of field workers m h’ s = 226,166 = 93* field workers 14 months x 173 m h’ s / month
• The number of field man-hours per M.E. item = 226,166 = 2,630 man-hours 86 M.E. items
* This number could peak at 125 – 140 during the mid point of the construction effort;
this also excludes field indirect support, which could be another 20 – 35% more hours.
The value of Construction Management is $1,170,000 if we divide this value by $65.50 which is the all-in rate for Construction Management effort we would come up with 17,860 man-hours divided by a 14 month construction effort at 170 man-hours per month would indicate that the average number of Construction management staff would average out to be 7.5 individuals. Following on in the same vain the procurement effort is valued at $173,000 the hourly rate for this activity is $59 per hour, the procurement effort would typically take 5 months to complete, so $59 divided into $173,000 = 2,930 hours divided by 5 moths divided by 166 man-hours per month would equal 3.5 procurement personnel involved with the procurement / buy out effort.
Utilizing historical benchmark relationships, we can establish a number of front end reporting tools to allow management to make some key decisions. The reports could include: A scope of work, an appropriation budget (AFE estimate), front end loading / schedules / project milestone schedules (30 – 90 – 180 day look ahead schedule), engineering, procurement and construction work packages, field labor needs, progress measurement / progress tools and cash call / expenditure and commitment reports USA Productivity Factors (versus Gulf Coast): The normal approach of comparing
“process / refinery / manufacturing” construction productivity is to compare various locations around the USA to a known basis or benchmark of 1.00 or 100 for Texas Gulf Coast (open shop labor working from say Mobile, AL in the north and south to say Corpus Christi, TX, - because there is so much historical cost data that has been collected over the last 20 – 30 years, the term Gulf Coast productivity is well known and understood term in the construction industry):
State Open Shop / Non-Union Union
Alabama 1.00 1.10 - 1.15
Alaska 1.10 – 1.15 1.25 – 1.35
Arizona (Phoenix / Tucson) 1.00 1.10 - 1.15
Arizona 1.00 1.10
Arkansas 1.00 1.15 California (LA / Long Beach
/ SF / SD / SJ)
1.10 1.20 – 1.30
California 1.05 1.10 - 1.20
Colorado (Denver) 1.00 - 1.10 1.10 - 1.15
Colorado 1.00 1.05 - 1.10
Connecticut 1.15 1.20 - 1.30
Delaware 1.10 1.20
Florida (Jacksonville / Miami / Orlando / St P )
1.00 – 1.10 1.15 - 1.20
Florida 1.00 1.10
Georgia (Atlanta) 1.00 - 1.10 1.10 - 1.20
Georgia 1.00 1.10
Hawaii 1.10 - 1.15 1.30
Idaho 1.05 1.25
Illinois (Chicago) 1.00 - 1.15 1.20 – 1.30
Illinois 1.05 1.10 - 1.15
Indiana 1.05 1.10 - 1.15
Iowa 1.05 1.10 - 1.15
Kansas 1.05 1.10 - 1.15
Kentucky 1.05 1.10 – 1.15
Louisiana 1.00 1.10 – 1.15
Maine 1.05 - 1.15 1.10 - 1.25
Maryland (Baltimore) 1.05 – 1.10 1.10 - 1.25
Maryland 1.00 – 1.05 1.10 – 1.15
Massachusetts (Boston) 1.10 - 1.15 1.20 – 1.30
Massachusetts 1.00 – 1.10 1.10 – 1.15
Michigan (Detroit) 1.05 - 1.10 1.20 - 1.30
Michigan 1.05 1.10 - 1.20
Minnesota (Minneapolis – St Paul)
1.05 - 1.10 1.10 - 1.20
Minnesota 1.05 1.10 - 1.15
Mississippi 0.90 - 1.00 1.10 - 1.15
Missouri (St Louis) 1.05 – 1.10 1.10 – 1.20
Missouri 1.00 – 1.05 1.05 – 1.15
Montana 1.05 - 1.10 1.10 - 1.20
Nebraska 1.05 1.10 - 1.15
Nevada (LV / Reno) 1.05 1.15
Nevada 1.00 – 1.05 1.05 – 1.10
New Hampshire 1.05 - 1.10 1.10 - 1.20
New Jersey (Newark / Northern)
1.15 1.20 - 1.30
New Jersey 1.10 1.10 - 1.20
New Mexico 1.05 1.15
New York City 1.10 - 1.15 1.30 – 1.40
New York 1.05 - 1.10 1.10 - 1.20
North Carolina 1.05 1.15
North Dakota 1.05 1.15
Ohio (Cleveland) 1.05 – 1.10 1.15 – 1.20
Ohio 1.05 1.10 - 1.15
Oklahoma 1.05 1.15
Oregon 1.05 1.15
Pennsylvania (Philadelphia / Pittsburgh)
1.10 - 1.15 1.20 – 1.30
Pennsylvania 1.05 - 1.10 1.10 - 1.20
Puerto Rico 1.60 – 1.90 1.50 – 2.00
Rhode Island 1.05 1.15
South Carolina 0.90 - 1.00 1.05 - 1.10
South Dakota 1.05 1.15
Tennessee 1.00 - 1.05 1.10 - 1.15
Texas (Dallas / Houston) 1.05 - 1.10 1.10 - 1.20 Texas (Gulf Coast) - Base
Case this includes Gulfport, Baton Rouge, New Iberia, Lake Charles, Beaumont, Port Arthur, Baytown, Texas City and Victoria:
(Note: in certain cases i.e.
large projects with a lot of repeat / similar work
activities: productivity could be 0.90 – 1.00 say an average of 0.95)
1.00 1.10 – 1.15 (typically all work is completed on
open shop basis)
Utah 1.05 1.10 - 1.15
Vermont 1.05 1.15
Virginia (Washington D.C.) 1.10 - 1.15 1.20 - 1.30
Virginia 1.05 1.15
Washington 1.05 1.15
West Virginia 1.00 - 1.05 1.00 - 1.15
Wisconsin 1.05 1.15
Wyoming 1.05 1.15
Engineering, Procurement and Construction (EPC) Benchmarking Data:
The subsequent dollar and man-hour values are typical benchmarking guides for future estimating / auditing estimates. This data applies to mid sized “process / chemical related” projects executed in the last 10 years specific to North American applications.
Major Construction Activities
Field labor union skilled worker $48 - $80*/ Hour
Ditto non union $37 - $64 / Hour
For unskilled application multiply by 0.75
Construction Manager / Clerk of the Works $58 - $95 / Hour
Demolition 5% - 35% of the cost of new work
Rock excavation - loose / rippable, hours per CY / M3 1.0 - 2.5 CY & 1.3 – 3.3 M3 Ditto needing jackhammers, hours per CY / M3 2.0 - 5.0 CY & 2.6 – 6.5 M3 Machine excavation, hours per CY / M3 0.2 - 0.4 CY & 0.26 – 0.5 M3 Hand excavation (Loose non stiff), hours per CY / M3 1.5 - 2.0 CY & 2.0 – 2.6 M3 Ditto stiff / hard material, hours per CY / M3 2.25 - 3.25 CY & 2.9 – 4.25 M3 Concrete foundations (inc. excavation, formwork / Rebar
/ installation etc.) Hours per CY / M3 12 - 24 CY & 15.7 – 31 M3 1” dia conduit 0.12 - 0.14 / MH per LF & 0.39 - 0.45 M
2” ditto 0.14 - 0.16 / MH per LF & 0.45 - 0.52 M
Bricks (800 – 1,000 per day is considered a good production rate)
500 - 750 per day Fabricate & erect C.S. piping (2”) hours 1.25 - 1.85 / L.F & 4.1 - 6.1 M.
Fabricate & erect C.S. piping (6”) hours 2.4 - 3.0 / L.F & 7.87 - 9.84 M.
Fabricate pipe offsite 20 - 40 hours / ton
Erect piping (2” and above) 100 - 200 hours / ton
Average Fabricate & erect 150 - 200 hours / ton 4” dia production weld (sch 160) 2.0 - 2.50 hrs:
6” ditto 2.75 - 3.5 hrs:
Average cost per pound / kg to fabricate and erect piping system based on Average cost $12,500 -
$17,500 per ton, average $15,000 per ton
$57.0 per pound and $15.00 kg
Structural steel erection hours 8 - 25 / ton
* In major cities such as New York, Chicago Philadelphia and Los Angeles etc this union hourly rate ranges between $75 and $91:
Engineering / Home Office Costs / Data:
Function / General Data Cost / Man-hour Units
Project Manager $65 - $135 / hour
Architect $65 – $135 / hour
Civil Engineer $65 - $115 / hour
Home office engineer $65 - $115 / hour
Estimator $65 - $115 / hour
Designer $47 - $75 / hour
Man-hours per item of major equipment 600 –1200 (aver 700)
Man hours per PFD 40 - 100
Man-hours per P. & I.D: 250 -500
Man-hours per plot plan / G. A. 100 –200
Man hours per ISO. 4 / 6
CAD machine bill out rate $21 - $50 / hour
Procurement / Contract / Project Control
Procurement / Contracts Engineer $43 - $86 / hour
Project Control Engineer $43 - $91 / hour
Man-hours per material inquiry / requisition 4 - 12
Man-hours per purchase order 30 - 50
Man-hours per contract 60 –100
Inspection of M.E. item 4 – 8 / hours
For additional data specific to installation man-hour units refer to later chapters.