18 Plant Design and Cost Russell roane 1.0 INTRODUCTION TO THE CAPITAL PROJECT LIFE CYCLE Capital cost projects begin when a need is defined that cannot be satisfied in existing facilities. Thus begins the life cycle of a capital project (Fig. 1). Once started, the project will progress through all of the following phases or be canceled. It all starts with the recognition of a need that will require capital plant. In the conceptual phase of the project, multiple approaches will be evaluated and one or more plans will be evaluated fo meeting these needs. The conceptual plan, if a process plant, will be defined in plant configuration drawings and process flow diagrams; if an architec tural project, by plant configuration and programming documentation. If it is a process plant, then a process flow scheme must be generated and a configuration for the facility conceived including any support requirements that must be included for the operationto function. If an architectural project, then all the spaces must be defined and the programming completed to a stage that assures that all required building functions are provided. Most times this phase is concluded with an order of magnitude estimate that is used to assess the economic viability of the project 759
18 Plant Design and Cost Russell T. Roane 1.0 INTRODUCTION TO THE CAPITAL PROJECT LIFE CYCLE Capital cost projects begin when a need is defined that cannot be satisfied in existing facilities. Thus begins the life cycle of a capital project (Fig. 1). Once started, the project will progress through all of the following phases or be canceled. It all starts with the recognition of a need that will require capital plant. In the conceptual phase of the project, multiple approaches will be evaluated and one or more plans will be evaluated for meeting these needs. The conceptual plan, if a process plant, will be defined in plant configuration drawings and process flow diagrams; if an architectural project, by plant configuration and programming documentation. If it is a process plant, then a process flow scheme must be generated and a configuration for the facility conceived including any support requirements that must be included for the operation to function. Ifan architectural project, then all the spaces must be defined and the programming completed to a stage that assures that all required building functions are provided. Most times this phase is concluded with an order of magnitude estimate that is used to assess the economic viability of the project. 759
760 Fermentation and Biochemical Engineering Handbook CAPITAL PROJECT LIFE CYCLE CONCEPTUAL DESIGN PRELIMINARY DESIGN DETAILED DESIGN CONSTRUCTION START-UP FULL OPERATION Figure 1. The life cycle of a capital project The second phase is normally called preliminary en objective is normally two fold: sufficient engineering to achieve overall definition of scope for the project and establish a firm budget for completion of the project. The estimate prepared at this point is normally called the authorization estimate. with this information the decision is made on whether the project is to be completed. To get to this point usually takes between 15 and 30%ofthe total design cost. Some will call this the definition phase of the project Next is the main design phase of the project, normally called detailed completed and the procurement for the project begins. The equipmellfpo engineering During this phase of the project, the design of the facility specified and purchased. All required design documentation is prepared and assembled into bid packages preparatory to construction. Somewhere during detailed engineering, the authorization estimate may be updated to become what some call the control estimate or, in an effort to more tightly control cost, this may be managed by continual tracking ofthe authorization estimate The project is then taken to the field. This is the construction phase of the project. This phase of the project can be managed with several types of organizations. In construction management form, the engineer, architect, or owner, puts together a construction management team. The work to be executed is then specified in subcontracts. Each subcontract contains the work centered around one craft or construction trade. The construction management team is then responsible for seeing that the work is completed ontime, as specified (of acceptable quality), and that field costs are controlled
760 Fermentation and Biochemical Engineering Handbook CAPITAL PROJECT LIFE CYCLE CONCEPTUAL DESIGN PRELIMINARY DESIGN DETAILED DESIGN CONSTRUCTION FULL OPERATION START-UP Figure 1. The life cycle of a capital project. The second phase is normally calledpreliminary engineering and its objective is normally two fold: sufficient engineering to achieve overall definition of scope for the project and establish a firm budget for completion of the project. The estimate prepared at this point is normally called the authorization estimate. With this information, the decision is made on whether the project is to be completed. To get to this point usually takes between 15 and 30% ofthe total design cost. Some will call this the definition phase of the project. Next is the main design phase of the project, normally called detailed engineering. During this phase of the project, the design of the facility is completed and the procurement for the project begins. The equipment is specified and purchased. All required design documentation is prepared and assembled into bid packages preparatory to construction. Somewhere during detailed engineering, the authorization estimate may be updated to become what some call the control estimate or, in an effort to more tightly control cost, this may bemanaged by continual tracking ofthe authorization estimate. The project is then taken to thefield. This is the construction phase of the project. This phase of the project can be managed with several types of organizations. In construction management form, the engineer, architect, or owner, puts together a construction management team. The work to be executed is then specified in subcontracts. Each subcontract contains the work centered around one craft or construction trade. The construction management team is then responsible for seeing that the work is completed on time, as specified (of acceptable quality), and that field costs are controlled
Plant Design and Cost 761 to budget. In direct hire form, the construction management team is expanded to allow direct supervision of the craft workmen on the project and the responsibility for performance of the subcontracts is not delegated. As the name implies, the craft workmen are directly hired. In the third form, general contracting, a multicrafted or key contractor is hired and he then becomes the responsible party for execution of the work. He will perform the project utilizing his own employees and subcontracting the craft work not common to his work force. In this form, quality oversight must be accounted for and performed. Construction's normal objective is what is termed mechanical completion. Mechanical completion is normally defined as a plant that is fully assembled and has been checked for operability, but has not been performance tested. An agreed level of clean out is part of mechanical completion. The project is ready for start-up, not operation a transition phase betwe dedication to full operation. It includes performance testing, final clean out, trial production phase, and the first full scale operations. Water batching is a common means of achieving both clean out and testing. Where water batching is not appropriate, solvent testing may be used, or selected as a second step, to achieve dry out and testing. The objective of either is to test the plant and prepare it for trial operation. Trial operation will be planned to risk a minimum amount of materials to performance-test the operation. It can take many forms, i.e, reduced operation through low flows, smaller batches, or utilization of substitute materials. The start-up phase is best shared between the designers, the constructors, and the plant operators. The designers contribute how the plant was designed to operate, the constructor do the required mechanical work, removing and replacing items of temporary installation, assisting with commissioning of specialty equipment, mechani cal adjustments, and other corrections that appear as the start-up progresses and the operating people learn how to operate their plant. Start-ups are best managed by the operations people with assistance by support groups. It is important to consider the people as well as the equipment in planning the start-up Overstaffing can lead to methods of operation that are expeditious, but not sustainable for the plant to be profitable. The plant staffis best supported by staff that plans to leave the project. When the plant proves itself capable of full operation by unaugmented staff, it can be declared out of start-up and dedicated to plant operations These are the phases that a capital project passes through from nception to dedication. Overlapping of the phases and compression of chedule is commonly achieved through an approach called fast tracking. It
Plant Design and Cost 761 to budget. In direct hire form, the construction management team is expanded to allow direct supervision ofthe craft workmen on the project and the responsibility for performance ofthe subcontracts is not delegated. As the name implies, the craft workmen are directly hired. In the third form, general contracting, amulticrafted or key contractor is hired and he then becomes the responsible party for execution of the work. He will perform the project utilizing his own employees and subcontracting the craft work not common to his work force. In this form, quality oversight must be accounted for and performed. Construction’s normal objective is what is termed mechanical completion. Mechanical completion is normally defined as a plant that is fully assembled and has been checked for operability, but has not been performance tested. An agreed level of clean out is part of mechanical completion. The project is ready for start-up, not operation. Start-up is a transition phase between mechanical completion and dedication to full operation. It includes performance testing, final clean out, trial production phase, and the first full scale operations. Water batching is a common means of achieving both clean out and testing. Where water batching is not appropriate, solvent testing may be used, or selected as a second step, to achieve dry out and testing. The objective of either is to test the plant and prepare it for trial operation. Trial operation will be planned to risk a minimum amount of materials to performance-test the operation. It can take many forms, Le., reduced operation through low flows, smaller batches, or utilization of substitute materials. The start-up phase is best shared between the designers, the constructors, and the plant operators. The designers contribute how the plant was designed to operate, the constructors do the required mechanical work, removing and replacing items of temporary installation, assisting with commissioning of specialty equipment, mechanical adjustments, and other corrections that appear as the start-up progresses, and the operating people learn how to operate their plant. Start-ups are best managed by the operations people with assistance by the other support groups. It is important to consider the people as well as the equipment in planning the start-up. Overstaffing can lead to methods ofoperation that are expeditious, but not sustainable for the plant to be profitable. The plant staff is best supported by staff that plans to leave the project. When the plant proves itself capable of full operation by unaugmented staff, it can be declared out of start-up and dedicated to plant operations. These are the phases that a capital project passes through from inception to dedication. Overlapping of the phases and compression of schedule is commonly achieved through an approach calledfast trachng. It
62 Fermentation and Biochemical Engineering Handbook comes to the fore any time where the benefits of early completion outweigh the added costs. Some will argue that there is no added cost since fixed costs duced to offset the limited inefficiency of redo required. What can be upon is that there is an optimum balance for each project, and time finding it will help to assure that the project will be a success 20 CONCEPTUAL PHASE The conceptual phase of a project starts before there is a project. This phase of the project is where a plan for satisfying a need will be conceived (Fig. 2). Definition of the need will start the process. a method of satisfying the need will be the result. The need may be for increased capacity, new product, elimination of bottlenecks in existing facilities, modernization, meeting new regulations, energy efficiency, and waste minimization, to name CONCEPTUAL PHASE A NEED MUST BE FILLED THE FIRST SOLUTION Figure 2. The conceptual phase One good approach at this time is to prepare multiple hope to find an optimum solution. Realize that this is the phase where the optimum solution can be found most economically, beyond this phase the solution chosen can be optimized, but to change the chosen solution will require returm and restart at this phase with a large portion of the work of later phases discarded The most important element at this phase of the project is that the project team shall have a varied experience base, i. e,, creating plans to satisfy needs is easily facilitated. Success comes with a team strong in three ways (i) experience in the industry, (i)experience in the various skills required for the project, and(iii) experience in this creative period of a project
762 Fermentation and Biochemical Engineering Handbook comes to the fore any time where the benefits of early completion outweigh the added costs. Some will argue that there is no added cost since fixed costs are reduced to offset the limited inefficiency of redo required. What can be agreed upon is that there is an optimum balance for each project, and time spent finding it will help to assure that the project will be a success. 2.0 CONCEPTUAL PHASE The conceptualphase of a project starts before there is a project. This phase of the project is where a plan for satisfying a need will be conceived (Fig. 2). Definition of the need will start the process. A method of satisfying the need will be the result. The need may be for increased capacity, new product, elimination of bottlenecks in existing facilities, modernization, meeting new regulations, energy efficiency, and waste minimization, to name a few. CONCEPTUAL PHASE A NEED MUST BE FILLED THE FIRST SOLUTION Figure 2. The conceptual phase. One good approach at this time is to prepare multiple solutions and hope to find an optimum solution. Realize that this is the phase where the optimum solution can be found most economically, beyond this phase the solution chosen can be optimized, but to change the chosen solution will require return and restart at this phase with a large portion ofthe work of later phases discarded. The most important element at this phase of the project is that the project team shall have a varied experience base, Le., creating plans to satisfy needs is easily facilitated. Success comes with a team strong in three ways. (i) experience in the industry, (ii) experience in the various skills required for the project, and (iii) experience in this creative period of a project
Plant Design and Cost 763 This phase of a project is best guided by the statement of the need Example: The sales projections for our product exceed our production capacity starting the middle of next year Start with the statement and collect ideas for solutions. Next, evaluate the solutions and select the ones with the most favorable features for further evaluation. As part of the evaluation procedure, determine the"must have features and the"would like to have features The final selections should have all the musts and as many of the high ranked wants as can be accommodated. Some of the ideas will be found unsuitable as their development begins Take the three or five best ideas and develop them with the objective of finding out their space requirements and their equipment requirements Develop them sufficiently to produce a first order cost comparison. In this phase of the project, the objective is to do sufficient development so that two things areestablished: (i) which solution you haveuncovered best satisfies the need at a justifiable cost, and (ii) what is the first order estimate of that cost Warning: The most overlooked items are not core to the process, but required as support for the project, i.e., facilities to produce utilities at the capacity required; sufficient laboratory, warehouse, waste disposal, or in- proce Each solution must be given an overall evaluation for hazards that impact safety and potential monetary loss. This need not be an itemized comprehensive review but it should encompass hazards to the employees and the environment, loss due to fire, or unplanned equipment failure, and most important, release of hazardous raw material, intermediate, or product This phase of the project is complete when a cost-effective means of fulfilling the defined need has been identified and estimated. Cost estimates at this stage in the project are not very accurate; plus or minus 50% is the norm. It is the basis for the decision whether to go ahead with additional effort to firm up the project 's budget. Many projects are underfunded and not viewed as a success if the estimate produced at this stage is used to fund the pro 3.0 PRELIMINARY DESIGN PHASE The preliminary design phase is where sufficient work is done to estimate the cost of the project to an accuracy that is consistent with the sponsoring organizations requirements for funding of a project. Estimating accuracy will be related to the percentage of total design cost spent stimating accuracy is usually in the range of 15%to +30%. A frequently
Plant Design and Cost 763 This phase of a project is best guided by the statement of the need. Example: “The sales projections for our product exceed our production capacity starting the middle of next year”. Start with the statement and collect ideas for solutions. Next, evaluate the solutions and select the ones with the most favorable features for further evaluation. As part of the evaluation procedure, determine the “must have” features and the “would like” to have features. The final selections should have all the musts and as many of the high ranked wants as can be accommodated. Some of the ideas will be found unsuitable as their development begins. Take the three or five best ideas and develop them with the objective of finding out their space requirements and their equipment requirements. Develop them sufficiently to produce a first order cost comparison. In this phase of the project, the objective is to do sufficient development so that two things are established: (i) which solution you have uncovered best satisfies the need at a justifiable cost, and (ii) what is the first order estimate ofthat cost. Warning: The most overlooked items are not core to the process, but are required as support for the project, i.e., facilities to produce utilities at the capacity required; sufficient laboratory, warehouse, waste disposal, or inprocess storage. Each solution must be given an overall evaluation for hazards that impact safety and potential monetary loss. This need not be an itemized, comprehensive review but it should encompass hazards to the employees and the environment, loss due to fire, or unplanned equipment failure, and most important, release of hazardous raw material, intermediate, or product. This phase of the project is complete when a cost-effective means of fulfilling the deked need has been identified and estimated. Cost estimates at this stage in the project are not very accurate; plus or minus 50% is the norm. It is the basis for the decision whether to go ahead with additional effort to firm up the project’s budget. Many projects are underfimded and not viewed as a success if the estimate produced at this stage is used to fund the project. 3.0 PRELIMINARY DESIGN PHASE The preliminary design phase is where sufficient work is done to estimate the cost of the project to an accuracy that is consistent with the sponsoring organization’s requirements for funding of a project. Estimating accuracy will be related to the percentage of total design cost spent. Estimating accuracy is usually in the range of 2 15% to +30%. A frequently
764 Fermentation and Biochemical Engineering Handbook experienced case is that of a +25% estimate with +30% of design cost The preliminary design phase is also where sufficient design work done to assure operability of the project without additional scope. The first step is to evaluate what work must be done to assure that the required scope is comprehensive for the project: what work must be done, to what detail,to achieve the required accuracy of the estimate(Fig. 3). If a conceptual estimate has been made, a quick study of it shows which are its largest accounts and then focus can be on the improvement of their accuracy. a second review that is painfully forgotten is the evaluation of the project for overall completeness of the scope. Questions to ask at this point are Are emissions suitable for permitting with the current design? Are treatment solids also disposable? Are there previous commitments that become part of this proje Are utilities sufficient and available where required? Are utility systems suitable for permitting at the increased Are the following sufficient: Offices? Laboratories? Warehouse? Roadway? Site drainage? Security? Phone syste Are current operations impacted (i.e, grandfathering re- loved)? Buildings? Processes? Other planed services? Is building construction compatible with the need? Fin ishes? Seismic? Height? Relief requirements? Have all plant fumiture and vehicles been included? PRELIMINARY DESIGN IS THE SOLUTION FEASIBLE IS THE SOLUTION COMPLETE? IS THE ESTIMATE SUITABLE?
764 Fermentation and Biochemical Engineering Handbook experienced case is that of a +25% estimate with +30% of design cost expended. The preliminary design phase is also where sufficient design work is done to assure operability of the project without additional scope. The first step is to evaluate what work must be done to assure that the required scope is comprehensive for the project: what work must be done, to what detail, to achieve the required accuracy of the estimate (Fig. 3). If a conceptual estimate has been made, a quick study of it shows which are its largest accounts and then focus can be on the improvement of their accuracy. A second review that is painfully forgotten is the evaluation of the project for overall completeness of the scope. Questions to ask at this point are: Are emissions suitable for permitting with the current design? Are treatment solids also disposable? Are there previous commitments that become part of this Are utilities sufficient and available where required? Are utility systems suitable for permitting at the increased Are the following sufficient: Offices? Laboratories? Solid? Liquid? Gas? project? rates? Warehouse? Roadway? Site drainage? Security? Phone system? Fire protection? Are current operations impacted (Le., grandfathering removed)? Buildings? Processes? Other planed services? Is building construction compatible with the need? Finishes? Seismic? Height? Relief requirements? Have all plant hmiture and vehicles been included? PRELIMINARY DESIGN IS THE SOLUTION FEASIBLE? IS THE SOLUTION COMPLETE? IS THE ESTIMATE SUITABLE? Figure 3. The preliminary design phase
d Cost 765 Here is but a partial list of the questions to be asked so that unestimated scope does not enlarge the project beyond its estimated accuracy and interfere with its profitability. At some point in preliminary design, a project logic meeting is in order where the sole focus is uncovering potential flaws in the projects logic. a blend of those most knowledgeable about the project and seasoned evaluators less immediately involved with the project can best perform this effort If the project has sizable architectural considerations, it is important they be properly estimated. Those dollars per square foot numbers that are so useful early in the project need to be firmed up. For the biotech and dosage harmaceutical projects of today, it is as important that the building costs be as accurate as the equipment costs. Sometimes an account-by-account evaluation for estimating accuracy is in order to see if sufficient work has been done to assure the validity of the overall estimates accuracy 4.0 DETAIL DESIGN PHASE The detail design phase of a project is where most of the cost of a project is committed. During this phase of the project, the design work is completed and most of the equipment purchased. The focus for this phase of a project is to turn all of the plans developed to date into a purchasable and buildable set of documentation(Fig. 4). To expedite the schedule, the construction contract may be let as this phase is being completed. Changes made during this phase of a project tend to be very costly as they result in the discarding of work and materials for which recovery will be minimal. For this reason. it Is olling costs to make the transition into this phase of the project with the scope approved and complete. If items are yet to be decided, it is important that they be clearly defined as undecided items so that when the decisions are made work need not be repeated DETAIL DESIGN IS THE DESIGN COMPLETE CAN THE DESIGN BE CONSTRUCTED? Figure 4. The detail design phase
Plant Design and Cost 765 Here is but a partial list ofthe questions to be asked so that unestimated scope does not enlarge the project beyond its estimated accuracy and interfere with its profitability. At some point in preliminary design, a project logic meeting is in order where the sole focus is uncovering potential flaws in the project’s logic. A blend of those most knowledgeable about the project and seasoned evaluators less immediately involved with the project can best perform this effort. If the project has sizable architectural considerations, it is important they be properly estimated. Those dollars per square foot numbers that are so useful early in the project need to be firmed up. For the biotech and dosage pharmaceutical projects of today, it is as important that the building costs be as accurate as the equipment costs. Sometimes an account-by-account evaluation for estimating accuracy is in order to see if sufficient work has been done to assure the validity of the overall estimates accuracy. 4.0 DETAIL DESIGN PHASE The detail design phase of a project is where most of the cost of a project is committed. During this phase of the project, the design work is completed and most of the equipment purchased. The focus for this phase of a project is to turn all of the plans developed to date into a purchasable and buildable set of documentation (Fig. 4). To expedite the schedule, the construction contract may be let as this phase is being completed. Changes made during this phase of a project tend to be very costly as they result in the discarding of work and materials for which recovery will be minimal. For this reason, it is important in controlling costs to make the transition into this phase of the project with the scope approved and complete. If items are yet to be decided, it is important that they be clearly defined as undecided items so that when the decisions are made work need not be repeated. DETAIL DESIGN IS THE DESIGN COMPLETE? CAN THE DESIGN BE CONSTRUCTED? Figure 4. The detail design phase
766 Fermentation and Biochemical Engineering Handbook During this phase of the design work the scope established in the preliminary phase of the project is divided into work packages for award as subcontracts or, if the construction is done on a direct hire basis, they become the work packages for the various crafts Some discussion is in order at this point to differentiate between what are called the architectural and engineering approaches to detailed design and construction. Most projects in the food, pharmaceutical, and biotech industries require a blend of these two techniques of design. In the architectural approach, detailed design is completed by mechanical design subcontract or inclusion in construction subcontracts. With the engineering approach, the detailed design is completed as part of one engineering effort The architectural approach passes on the engineering by written functional specifications describing how the installation is to function, not how that function is to be achieved. The engineering approach details how eacl function is to be achieved. Each approach proponents and detractors. By looking at only the cost of the primary design work, the architectural approach will appear less expensive. It is the writer's opi that the architectural approach is very good for designs where utilization of repeated, well-understood elements is a major component of the work, (i.e the building part of the project). The engineering approach is better where a process is being installed(the process design). The disadvantage in utilizing the engineering approach to the building is that, many times, it does not allow ompletion to occur with mixes and matches of materials that lower final installed cost. A secondary disadvantage is that the tendency in engineering approach is for unique design elements that restrict competitive bidding to reduce cost. The disadvantage to the architectural approach is that the design work can more easily slip into the hands of those who do not fully understand the functionality of what they are being asked to achieve. Also, design documentation required for regulatory review and compliance becomes available later Because the eng ng approach allows an estimate in better detail at an earlier point in the project, it allows better budget and schedule control. In summary, if this is an all-process building, use the engineering approach; if just offices and laboratories, use the architectural approach and, if a blend(as are most projects in this industry), use a blended approach to cost effectively achieve your objectives Remember that, when organizing for the detail design phase of a project, the design will be a complex and detailed undertaking. Be sure that ufficient documentation takes place to ensure that those who turn it into a completed operating facility have sufficient information to properly under stand what they are to achieve
766 Fermentation and Biochemical Engineering Handbook During this phase of the design work the scope established in the preliminary phase of the project is divided into work packages for award as subcontracts or, ifthe construction is done on a direct hire basis, they become the work packages for the various crafts. Some discussion is in order at this point to differentiate between what are called the architectural and engineering approaches to detailed design and construction. Most projects in the food, pharmaceutical, and biotech industries require a blend of these two techniques of design. In the architectural approach, detailed design is completed by mechanical design subcontract or inclusion in construction subcontracts. With the engineering approach, the detailed design is completed as part of one engineering effort. The architectural approach passes on the engineering by written functional specifications describing how the installation is to function, not how that function is to be achieved. The engineering approach details how each function is to be achieved. Each approach has its proponents and its detractors. By looking at only the cost of the primary design work, the architectural approach will appear less expensive. It is the writer’s opinion that the architectural approach is very good for designs where utilization of repeated, well-understood elements is a major component of the work, (i.e., the building part ofthe project). The engineering approach is better where a process is being installed (the process design). The disadvantage in utilizing the engineering approach to the building is that, many times, it does not allow completion to occur with mixes and matches of materials that lower final installed cost. A secondary disadvantage is that the tendency in engineering approach is for unique design elements that restrict competitive bidding to reduce cost. The disadvantage to the architectural approach is that the design work can more easily slip into the hands ofthose who do not fully understand the functionality of what they are being asked to achieve. Also, design documentation required for regulatory review and compliance becomes available later. Because the engineering approach allows an estimate in better detail at an earlier point in the project, it allows better budget and schedule control. In summary, if this is an all-process building, use the engineering approach ; if just offices and laboratories, use the architectural approach; and, if a blend (as are most projects in this industry), use a blended approach to cost effectively achieve your objectives. Remember that, when organizing for the detail design phase of a project, the design will be a complex and detailed undertaking. Be sure that sufficient documentation takes place to ensure that those who turn it into a completed operating facility have sufficient information to properly understand what they are to achieve
Plant Design and Cost 76 50 CONSTRUCTION PHASE The construction phase(Fig. 5. )of a project can be accomplished in three main ways-construction management, general contractor, and con struction by direct hire CONSTRUCTION WHERE DESIGN BECOMES REALITY Figure 5. The construction pha The construction management approach utilizes a construction man ager or a management team to manage and control the project, depending on project size. The project management can be from a group on staff with the owner, individuals hired for the duration of the project, or a contracted effort from a firm that specializes in these abilities. This project management team is responsible for the budget, schedule, and quality of installation. They have sufficient people on their team to assure that the work is proceeding on time. within budget, and is being constructed according to specifications. The physical work is accomplished through subcontracts awarded to individual companies to complete separated scopes of work that are within there acknowledged skills. These skills most often parallel those of the desig discipline engineers: electrical, mechanical, civil, structural, etc The general contractor approach gives the responsibility for construc- tion management to a construction contractor. Most often this contractor will be the one who will also hold the largest subcontract on the project. The major advantage of the arrangement is lower cost. It does not, however, come without price. The contractor selected may not have the qualified people to control the parts of the job in which he has no expertise, he may add parts of the project to his work scope that he is not qualified for, and the work he self- performs will not have the advantage of checks and balances on its quality The direct hire approach is used by those calling themselves construc- tors to gain the advantages of construction management in a way that competes with the cost of the general contractor approach. In this approach
Plant Design and Cost 767 5.0 CONSTRUCTION PHASE The construction phase (Fig. 5 .) of a project can be accomplished in three main ways-construction management, general contractor, and construction by direct hire. CONSTRUCTION WHERE DESIGN BECOMES REALITY Figure 5. The construction phase. The construction management approach utilizes a construction manager or a management team to manage and control the project, depending on project size. The project management can be from a group on staff with the owner, individuals hired for the duration of the project, or a contracted effort from a firm that specializes in these abilities. This project management team is responsible for the budget, schedule, and quality of installation. They have sufficient people on their team to assure that the work is proceeding on time, within budget, and is being constructed according to specifications. The physical work is accomplished through subcontracts awarded to individual companies to complete separated scopes of work that are within there acknowledged skills. These skills most often parallel those of the design discipline engineers: electrical, mechanical, civil, structural, etc. The general contractor approach gives the responsibility for construction management to a construction contractor. Most often this contractor will be the one who will also hold the largest subcontract on the project. The major advantage of the arrangement is lower cost. It does not, however, come without price. The contractor selected may not have the qualified people to control the parts of the job in which he has no expertise, he may add parts of the project to his work scope that he is not qualified for, and the work he selfperforms will not have the advantage of checks and balances on its quality. The direct hire approach is used by those calling themselves constructors to gain the advantages of construction management in a way that competes with the cost of the general contractor approach. In this approach
768 Fermentation and Biochemical Engineering Handbook the construction management team is expanded to include craft supervisors and the work force is assembled by moving in a cadre of permanent workers with the constructor and expanding that cadre with local hires from the craft work pools in the area. This approach allows the project to be done by a top flight construction management team, controlling cost and schedule, without the costly layering of management that occurin the construction management approach. This approach can gain the best of both worlds if the owner assures himself that the constructor has a strong quality management program that allows no compromises on quality in the construction of the facility If you reread the above, keeping in mind what was said about the architectural and engineering approaches in the section on detail design, you will realize that the negatives of the general contractor approach are minimized if the project lends itself to the architectural approach, and are maximized on a project that needs the engineering approach An agreed-upon condition on the completion date is an important project decision that should be made prior to award of construction contracts and should be made a written part of them. In the past, this was called mechanical completion, which was generally meant that all equipment was tested and ran in a mechanically approved manner and proper tests had been conducted to confirm tightness and pressure rating of system. Only necessary material for testing the system would be introduced. Today the requirements for cleanliness and proofing of tests as part of validation require that the definition of condition for turnover to start-up must be developed in much more detail. The questions to be asked when developing che completion plan are I What part of validation Installation Qualification(IQs) will be completed as part of the construction effort? 2 what will be the condition of the document control files on completion? 3 Is water batching or some related form of process simu lation without real materials to be included? 4 What part of validation Operational Qualification(OQs) will be completed as part of the construction effort? 5 What will be the condition ofthe spare parts that may have been ordered as part of the project purchases? 6 What help and checking will the owner supply or exercise as part of the construction effort?
768 Fermentation and Biochemical Engineering Handbook the construction management team is expanded to include craft supervisors and the work force is assembled by moving in a cadre of permanent workers with the constructor and expanding that cadre with local hires from the craft work pools in the area. This approach allows the project to be done by a top flight construction management team, controlling cost and schedule, without the costly layering ofmanagement that occur in the construction management approach. This approach can gain the best of both worlds ifthe owner assures himself that the constructor has a strong quality management program that allows no compromises on quality in the construction of the facility. If you reread the above, keeping in mind what was said about the architectural and engineering approaches in the section on detail design, you will realize that the negatives of the general contractor approach are minimized if the project lends itself to the architectural approach, and are maximized on a project that needs the engineering approach. An agreed-upon condition on the completion date is an important project decision that should be made prior to award of construction contracts and should be made a written part of them. In the past, this was called mechanical completion, which was generally meant that all equipment was tested and ran in a mechanically approved manner and proper tests had been conducted to confirm tightness and pressure rating of system. Only necessary material for testing the system would be introduced. Today the requirements for cleanliness and proofing of tests as part of validation require that the definition of condition for turnover to start-up must be developed in much more detail. The questions to be asked when developing the completion plan are: What part of validation Installation Qualification (IQ’s) will be completed as part of the construction effort? What will be the condition ofthe document control files on completion? Is water batching or some related form of process simulation without real materials to be included? What part of validation Operational Qualification (OQ’s) will be completed as part of the construction effort? What will be the condition ofthe spare parts that may have been ordered as part of the project purchases? What help and checking will the owner supply or exercise as part of the construction effort?
