SAJJAD KHUDHUR ABBASChemical Engineering , Al-Muthanna University, IraqOil & Gas Safety and Health Professional – OSHACADEMYTrainer of Trainers (TOT) - Canadian Center of Human Development

Episode 25 : Project Management

Typical products of process plants:◦ Chemistry: paints, plastics, fibres, fertilizers etc

◦ Pharmaceuticals: drugs◦ Cosmetics: creams, lotions, cosmetic products

etc◦ Refineries: fuels, basic products for

chemistry, lubricants etc◦ Building materials: cement, sand, gravel etc\

food industry: fats, oils, cereals, sugar etc\coal: mining and processing of coal

In a contect of plant design and construction, two parties have to be distinguished:

◦ Plant operator – wants to procure and operate a process plant

◦ Plant constructor – who according to the agreed scope of delivery and service, takes on the planning, devlievry, assembly and start-up.

Small plants◦ Production volume of up to RM 3-5 million

◦ Project duration up to one yaer◦ Many suppliers for small plants

Medium-sized plants◦ Order volumes of single or double digit amounts\◦ Project duration: 1-3 years◦ Carried out by a project team under the

leadership of a project manager –normally handle all steps of plant design and delivery

◦ Often include several smaller plants integrated as components

◦ Example: food production plants, sewage plants

Large-scale plant◦ Order volume – 500 – 1 billion

◦ Duration: exceeds two years◦ Large project teams headed by several project managers◦ General PM – overall responsibility which involves organisational

labour only◦ Composed of several medium-sized and multitude of small plant

units◦ Example: refineries, complete chemical complexes, steelworks

Technical Requirements Personal qualificationsExpert knowledge in the disciplines:Chemical process engineering Thermal process engineering Mechanical process engineering Biological process engineering Apparatus and pipeline engineering Pumps and compressorsMaterial science E/MC-Technology

EDP capabilitiesWord Processing Spreadsheet analysisCAD and CAE in plant engineering Pipe stress analysis

Communication skills Team spiritCross communication within the project teamAppearanceStress tolerance and adaptability IndependenceLoyaltyReadiness to take on responsibility AssertivenessNegotiating skills Cost consciousnessSpoken and written English Additional foreign language competenceExperience acquired abroad

PRODUCT IDEA/PRODUCT DEVELOPMENT

MARKET ANALYSIS(Product price, quantity and quality)

DETERMINATION OF INVESTMENT COSTS(Cost Estimation Methods)

DETERMINATION OF OPERATION COSTS

(Mass, material and energy balances)

FEASIBILITY STUDY

INQUIRY

PRIVATE PUBLIC

ENVIRONMENTAL IMPACT/ RISK

ANALYSIS

PREQUALIFICATIO

N BID/TENDER

BASIC ENGINEERING

Activities during the project planning phase

DEPOSITION OF TENDER

TENDER ANALYSIS AND COMPARISON

SIGNATURE OF THE CONTRACT

CONTRACT NEGOTIATION

BASIC ENGINEERING

Main components Determination of the offer price

SchedulingElectric components

Process Design Civil EngineeringBalancesLayout Materials Concept

Activities during the project planning phase (continued from previous)

PRODUCT ORGANIZATION AND SCHEDULING

AUTHORITY

APPROVAL DETAIL

ENGINEERING

Final Process Design Building/Steel structure P&I diagrammes

Design of plant components LayoutTechnical specifications

Documentation Piping engineering Electrical engineering

PROCUREMENT

Inquiries Bids of subsuppliers Bid comparison

Contract negotiations Orders and confirmations

EXPEDITING

11Activities during the project execution phase

EXPEDITING

ERECTION

Site Organization

Building/steel works Electrical partsPipes, valves and fittingsComponents

COLD COMISSIONING

WARM COMMISSIONING

DEMONSTRATION OF THE GUARANTEED PERFORMANCE

ACCEPTANC

E WARRANTY

Activities during the project execution phase (continued from previous)12

DEFINITION

Bringing new product to market Endeavor dealing with design, creation and marketing of product

TARGET

Product marketable in large quantities

Product realize at high selling price

IDEA

Technical ‐ Suitable product has to be found

Commercial ‐ Focusing consumer goods marketing

Research and Development ‐ Scientist and engineer conduct experiment to find a new and

better products13

i. Research the current price of the product.

ii. The status of product sellable in market by doing interview or statistic analysis. The product should be marketable in aslarge quantities as possible.

iii.

iv. The distribution of product should continue as long as possible.

14

Product Capacity

Type Of Project

Cost Estimation

ResourcesProfitability

Project Organization& Scheduling

Authorities Channel

Plant Site

Financial

FACTORS

MUST!!CONSIDER

IN STARTING A PROJECT

15

Location/Kind of Premises Plot of Land Operating Resources Labour Market Political Conditions Geographic Conditions Infrastructure Type of Building

Capacity/Availability/Lifespan Capacity

‐ Scheduled annual production output‐ Depends on Sales and Market

Availability or Operating Reliability ‐ Actual operating time of a plant in relation to overall time

‐ Stated as a % and relates to 8760 hrs/yr LIFESPAN

‐ Predetermined by the management‐ Periods range 5 to 30 years

‐ Longer lifespan, higher procurement costs

Degree of Automation“Fully automatic” plant Only the control room has to be staffedHigh labour cost – high degree of

automationLow‐wage countries – cheap personnel

are sufficiently available

Legal Requirements Depending on the country Regarding permission, implementation,

operation and control of a process plant

Environmental regulations : environmentally friendly plant

Safety regulations 16

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