Page 285 - Chemical engineering design

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To use Table 6.2, substitute the values given for the particular type of equipment into
the equation: CHEMICAL ENGINEERING
Ce D CS n 6.7
where Ce D purchased equipment cost, £,
S D characteristic size parameter, in the units given in Table 6.2,
C D cost constant from Table 6.2,
n D index for that type of equipment.

6.8. SUMMARY OF THE FACTORIAL METHOD
Many variations on the factorial method are used. The method outlined below can be
used with the data given in this chapter to make a quick, approximate, estimate of the
investment need for a project.

Procedure
1. Prepare material and energy balances, draw up preliminary flow-sheets, size major
equipment items and select materials of construction.
2. Estimate the purchase cost of the major equipment items. Use Figures 6.3 to 6.6
and Tables 6.2 and 6.3, or the general literature.
3. Calculate the total physical plant cost (PPC), using the factors given in Table 6.1
PPC D PCE 1 C f 1 C ÐÐÐ C f 9 6.8
4. Calculate the indirect costs from the direct costs using the factors given in Table 6.1.
5. The direct plus indirect costs give the total fixed capital.
6. Estimate the working capital as a percentage of the fixed capital; 10 to 20 per cent.
7. Add the fixed and working capital to get the total investment required.

6.9. OPERATING COSTS

An estimate of the operating costs, the cost of producing the product, is needed to judge
the viability of a project, and to make choices between possible alternative processing
schemes. These costs can be estimated from the flow-sheet, which gives the raw material
and service requirements, and the capital cost estimate.
The cost of producing a chemical product will include the items listed below. They are
divided into two groups.

1. Fixed operating costs: costs that do not vary with production rate. These are the
bills that have to be paid whatever the quantity produced.
2. Variable operating costs: costs that are dependent on the amount of product produced.
Fixed costs
1. Maintenance (labour and materials).
2. Operating labour.
3. Laboratory costs.
4. Supervision.
5. Plant overheads.