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FEED (Front End Engineering Design) means Basic Engineering

which is conducted after completion of Conceptual Design or


Feasibility Study. At this stage, before start of E.P.C (Engineering,
Procurement and Construction), various studies take place to
figure out technical issues and estimate rough investment cost.

Explanation of the Dow Fire and Explosion Index.


The Fire and Explosion Index (F&E!) calculation is a tool to help
determine the areas of greatest
loss potential in a particular process. It also enables one to
predict the physical damage that
would occur in the event of an incident.
The first step in making the F&EI calculation requires using an
efficient and logical procedure to
determine which process units should be studied. A process unit
is defined as any major item of
process equipment. The following process units could be
identified in a typical plant.
Unloading facility
Storage tank
Reactor
Distillation Column
Quench Vessel
Storage Vessel
Loading facility

A designation of the Process Unit must be entered in the


appropriate space on the F&EI
form. The Manufacturing Unit designation must also be entered
on the F&EI form. A
Manufacturing Unit is the entire production facility including
chemical processes,
mechanical processes, warehouse, packaging lines, etc.

It is quite clear that most manufacturing units have many


process units. To calculate the Fire and
Explosion Index, however, only process units that could have an
impact from a loss prevention
standpoint should be evaluated. These are known as Pertinent
Process Units.
Important factors for selecting Pertinent Process Units include:
a. Chemical energy potential (Material Factor)
b. Quantity of hazardous material in the Process Unit
c. Process pressure and process temperature
d. Units critical to plant operation, e.g. Reactor
Important Considerations
A. The Fire and Explosion Index system assumes that a process
unit handles a minimum of 2,500 kg of a flammable, combustible
or reactive material. If less material is involved, generally the risk
will be overstated. However, F&EI calculations can provide
meaningful results for pilot plants if they handle at least 500 kg)
of combustible or reactive material.

B. Careful consideration is needed when equipment is arranged


in series and the items are not effectively isolated from each
other. An example would be a reaction train without an
intermediate pump. In such situations, the type of process
determines whether several vessels or just a single vessel should
be considered as the Process Unit.
It should rarely be necessary to calculate the F&EI for more than
three or four Process Units in a single process area of a
Manufacturing Unit. The number of Process Units will vary
according to the type of process and the configuration of the
Manufacturing Unit.
A separate F&EI form must be completed for each process unit
evaluated.
C. It is also important to give careful consideration to the state or
point in time of the operation. By their nature, such normal
stages as startup, steady-state operation, shutdown, filling,
emptying, adding catalyst, etc., often create unique conditions
having an impact on the F&EI. Generally, good judgment will
enable selection of the point in time of operation to perform the
F&EI calculation. Occasionally more than one point in time will
have to be studied to determine the significant risk.
DETERMINATION OF MATERIAL FACTOR
The Material Factor (MF) is the basic starting value in the
computation of the F&EI and other risk analysis values. The MF is
a measure of the intrinsic rate of potential energy release from
fire or explosion produced by combustion or chemical reaction.
The MF is obtained from the flammability and instability rankings
according to NFPA 704. Generally, the flammability and instability
rankings are for ambient temperatures. It is recognized that the
fire and reaction hazards of a material increase markedly with
temperature. The fire hazard from a combustible liquid at a

temperature above its flash point is equivalent to that from a


flammable liquid at ambient temperature. Reaction rates also
increase very markedly with temperature. If the temperature of
the material on which the MF is based is over 140 F (60 C), a
certain adjustment may be required, as discussed below under C.
Temperature Adjustment of Material Factor.
Appendix A provides a listing of MFs for a number of chemical
compounds and materials, and these values will be used in most
cases. If Appendix A does not list the material, the flammability
and instability rankings may possibly be found in NFPA 325M or
NFPA 49 adjusted for temperature, if appropriate, and used with
Table l to determine the MF. If the material is a combustible dust,
use the Dust Hazard Class Number (St number) rather than the
flammability ranking.
A. Unlisted Substances
If neither Appendix A, NFPA 49, nor NFPA 325M contains values
for the substance, mixture or compound in question, these values
will have to be determined from the flammability ranking or dust
class (St) (see Table l). First, the parameters shown in the left
column of the table will have to be determined. The flammability
ranking of liquids and gases is obtained from flash point data,
and the St of dusts or mists is determined by dust explosion
testing. The flammability ranking of combustible solids depends
on the nature of the material as categorized in the left column.
The instability ranking can be obtained from a qualitative
description of the instability (or reactivity with water) of the
substance, mixture or compound at ambient temperature.
Definitions in National Fire Protection Association (NFPA) 704
should be used to assign hazard ratings for materials which are
not listed in the F&EI calculation tool in S2S.

PROCESS UNIT HAZARDS FACTORS


After the appropriate Material Factor has been determined, the
next step is to calculate the Process Unit Hazards Factor (F3),
which is the term that is multiplied by the Material Factor to
obtain the F&EI.
The numerical value of the Process Unit Hazards Factor is
determined by first determining the General Process Hazards
Factor and Special Process Hazards Factor listed on the F&EI form.
Each item which contributes to the Process Hazards Factors
contributes to the development or escalation of an incident that
could cause a fire or an explosion.
When calculating the penalties comprising the Process Unit
Hazards Factor, F3, pick a single specific instant in time during
which the material under consideration is in the most hazardous
normal operation state associated with the Process Unit. Startup,
continuous operation and shutdown are among the operational
states that may be considered.
This rather strict definition is intended to prevent double or triple
counting of hazards occurring during the process. Since the MF is
taken to be that of the most hazardous substance present in the
Process Unit, it can be certain that the Fire and Explosion analysis
will really be based upon a worst case when focus is placed
on the most hazardous operational point involving the MF, and
this will be a realistic worst case one that could actually occur.
In the F&EI system, only one hazard may be evaluated at a time.
If the MF is based on a flammable liquid present in the Process
Unit, do not take penalties relating to combustible dusts, even
though dust may be present at a different time. A reasonable
approach might be to evaluate the Process Unit once using the
MF of the flammable liquid and a second time using the MF of the
dust. Only the calculation resulting in the highest F&EI and Actual
Maximum Probable Property Damage need to be reported.

One important exception is the hybrid, described previously


under Mixtures. If a hybrid mixture is selected as the most
hazardous material present, it is penalized both as a dust and as a
flammable vapor in the Process Unit Hazards Factor sections of
this manual.
Some items on the F&EI form have fixed penalty values. For
those that do not, determine the appropriate penalty by
consulting the text that follows. Remember analyze only one
hazard at a time, relating the analysis to a specific, most
hazardous time (e.g., startup, normal operation or shutdown).
Keep the focus on the Process Unit and Material Factor selected
for analysis and
keep in mind that the results of the final calculation are only as
valid as the appropriateness of the penalty assessments. The
entry of all the pertinent information to allow calculation of the
Fire and Explosion Index and the radius of exposure is made in
the excel workbook F&EI Calculation workbook S2S July 2006.xls.
When the indexes for all pertinent units in the plant have been
calculated, the results give an indication of the ranking of risk of
each unit relative to another. This ranking can be used for
screening out the lower risk items and concentrating study on
the higher ones.

What is the relationship between FEED and FEL?

In the creation of an oil and gas project, say a client hires an


engineering contractor. Is there a relationship between Front End
Engineering Design and Front End Loading?
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7 Answers
7

Steve Budden answered 11 months ago

Quite an amount. FEED is the engineering portion which should


include HSSE in design as well. FEED tends to mainly focus on the
surface facilities, with geology, reservoir, etc too often treated
separately (though it should not be). FEED is a response to input
from other sources. Front end loading is about understanding the
total project including economics, environment, legislation/legal
framework, downhole issues, community affairs, etc. It is about
understanding the total risks associated with a project and
delivering appropriate responses....hence in reality, the questions
asked in a FEL process deliver the inputs to FEED, and then in
some review gate will act as questions challenging the FEED
deliverables.

FEED is about design; FEL is about understanding risk

Some other contributors may have slightly different opinions, but


this should provide a good starting point for the responses to your
question

Steve Budden
answered 11 months ago
1 More Comments
Fawzy Harraz Mar 31 Reply Like 1

Well said Mr. Budden; I couldn't agree more. FEED is part of the
wider bundle of efforts that make the FEL which is a mandate for
successful value-based asset development. The more questions

we pose, issues we raise, data we collect and benchmarks we do,


the more the success chances. FEL efforts spreads over Feasibility
and Concept Selection stages to pass Gate 1 and Gate 2, while
FEED is essentially the Concept Definition (simple Define stage as
some Operators name it) which is required for the Gate 3 Sanction
decision. The quality of the FEED depends on the quality of FEL.
The Statement of Requirement (SOR) is a key deliverable of FEL
which guides the FEED scope and shapes the FEED expectations.
For the sake of clarity, FEED is done by an Engineering/EPC
Contractor while FEL is an in-house task done by the Operator
core teams of geo-science, development and project
management, financial and economics, Permitting and
Regulatory, HSE....assisted by specialty service provider in
Seismic, drilling, Environmental.
Luiz Verri Apr 1 Reply Like

Perfect, Fawzy.
Manuel Carniglia Apr 5 Reply Like

I certainly agree

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Daniel Savard answered 11 months ago

Front-end loading (FEL), also referred to as pre-project planning


(PPP), front-end engineering design (FEED), feasibility analysis,
conceptual planning, programming/schematic design and early
project planning, is the process for conceptual development of
projects in processing industries such as upstream,
petrochemical, and refining. This involves developing sufficient
strategic information with which owners can address risk and
make decisions to commit resources in order to maximize the
potential for success.

Front-end loading includes robust planning and design early in a


project's lifecycle (i.e., the front end of a project), at a time when
the ability to influence changes in design is relatively high and the

cost to make those changes is relatively low. It typically applies to


industries with highly capital intensive, long lifecycle projects (i.e.,
hundreds of millions or billions of dollars over several years before
any revenue is produced). Though it often adds a small amount of
time and cost to the early portion of a project, these costs are
minor compared to the alternative of the costs and effort required
to make changes at a later stage in the project.

It also typically uses a stage-gate process, whereby a project


must pass through formal gates at well-defined milestones within
the project's lifecycle before receiving funding to proceed to the
next stage of work. The quality of front-end planning can be
improved through the use of PDRI (Project Definition Rating Index)
as a part of the stage-gate process.

FEED (Front End Engineering Design) means Basic Engineering


which is conducted after completion of Conceptual Design or
Feasibility Study. At this stage, before start of E.P.C (Engineering,
Procurement and Construction), various studies take place to
figure out technical issues and estimate rough investment cost.

FEL is usually followed by detailed design or detailed engineering.

Daniel Savard
answered 11 months ago

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Peter Noble answered 11 months ago

The answers given are basically correct, but a simpler high level
answer is that FEL is a business process and FEED is an
engineering process. Of course there is some engineering content
in the FEL process. Also FEL starts early and many projects die
before FEED if the early stages of FEL process do not show
promise. Also in my experience FEL is primarily an internal
company process, while FEED usually involves major outside
engineering work under the direction of the oil company.

Peter Noble
answered 11 months ago
Hessam Moussavi Apr 5 Reply Like

These phrases and sentences is valid to definr FEED and FEL: 1)


FEL is a business process and FEED is an engineering process....2)
FEL is primarily an internal company process, while FEED usually
involves major outside engineering work under the direction of
the oil company....3) FEED is about design; FEL is about
understanding risk 4) FEED is done by an Engineering/EPC
Contractor while FEL is an in-house task done by the Operator
core teams of geo-science, development and project
management, financial and economics, Permitting and
Regulatory, HSE....assisted by specialty service provider in
Seismic, drilling, Environmental.

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Arman Dyussembayev answered 11 months ago

Steve is right about the FEED. FEL in my company consider as a


philosophy and way how to create the project value and bring to
the front all actions that can help to start up Execution phase
smoothly. For example freeze all main technical solution at the
early stages of the project (at PRE-FEED or FEED for example)
instead of the Detail Design. FEL can be used at the any area, like
early actions, early engineering works via LOI, it is like take
proactive actions. IMHO

Arman Dyussembayev
answered 11 months ago
Arman Dyussembayev Mar 31 Reply Like

FEL consist of: Phase 1 Identify an opportunity Phase 2 Develop


the opportunity and select an option Phase 3 Define the selected

option Some of the mega companies has different name of phases


and amount but idia is same
Arman Dyussembayev Mar 31 Reply Like

So, FEED is part of the FEL


S Faiz Apr 1 Reply Like

Great answers.

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Alan Davies answered 11 months ago

Front End Loading is a general term referring to the concentration


of resources in the early stages of a project - this has been found
to be the most cost-effective project phase to do so.

The term 'Front End Engineering' is used to describe that phase of


engineering in a project which enables the placing of lump sum
contracts as early as possible rather than than the original
approach of hiring the engineering contrctor for all project phases
(It allows for the selection of a different detailed design
engineering contractor if required). FEED often includes detailed
design work on specific project items where long-lead times may
occur e.g. rotating machinery.

Alan Davies
answered 11 months ago

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Hessam Moussavi answered 11 months ago

These phrases and sentences is valid to definr FEED and FEL: 1)


FEL is a business process and FEED is an engineering process....2)
FEL is primarily an internal company process, while FEED usually
involves major outside engineering work under the direction of
the oil company....3) FEED is about design; FEL is about
understanding risk 4) FEED is done by an Engineering/EPC
Contractor while FEL is an in-house task done by the Operator
core teams of geo-science, development and project
management, financial and economics, Permitting and
Regulatory, HSE....assisted by specialty service provider in
Seismic, drilling, Environmental.

These phrases and sentences is valid to definr FEED and FEL: 1)


FEL is a business process and FEED is an engineering process....2)
FEL is primarily an internal company process, while FEED usually
involves major outside engineering work under the direction of
the oil company....3) FEED is about design; FEL is about
understanding risk 4) FEED is done by an Engineering/EPC
Contractor while FEL is an in-house task done by the Operator
core teams of geo-science, development and project
management, financial and economics, Permitting and
Regulatory, HSE....assisted by specialty service provider in
Seismic, drilling, Environmental.

What is the difference between the FEED and basic engineering


stages of a project?

I would like to open a discussion about the differences between


the FEED and basic engineering stages of a project. Please share
your experience in this regard and specify which one of the
following deliverables or activities should be done in the FEED
stage:

1-PFD (process flow diagram)


2-PID (piping and instrument diagram)
3-PDS (process data sheet)
4-Process description and operating manual
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Nilay Das 1y ago Reply Like

FEED is done after finalization of Basic Engineering. FEED should


contain all 1, 2, 3. 4 activities.
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10 Answers

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Jeff Barker answered 1+ year ago

Basic engineering is conceptual or preFEED stage. There may be


multiple cases, designs, options considered and the intent is to
identify the prevalent one with a cost estimate to support it. You
will have a process description but not datasheets, PFDs, or PIDs.

All 4 items you have listed are key FEED deliverables. FEED
consists of taking the design into a model, producing P&IDs,
MTOs, layouts, isometrics, etc to a level of engineering solid
enough to develop a cost estimate generally within +/- 15%, and
a level 3 schedule. All these deliverables makeup the FEED
package. Depending on the type of project, commissioning,
integration, and interface management, and project execution
plans should be well advanced. The full investment decision can
then either be approved or unapproved by the owners and
partners. A risk assessment should also be prepared during the
FEED stage.

Jeff Barker
answered 1+ year ago

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Mike Cooley answered 1+ year ago

Christopher All the items you list should be done during FEED and
much more. AS you and most know, FEED is the last gate in most
organizations' "gate" process to approve final design and
construction of a project. So the key deliverable from FEED is a
precise project definitions with several other key items including
strategy, execution planning, EHS, risk planning, etc., etc. Some
organizations, from a topsides perspective, often have rough

piping drawings done. Other technical disciplines produce a


similar level of information to define the project.

Mike Cooley
answered 1+ year ago

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Fawzy Harraz answered one year ago

How did I miss this interesting discussion ? I would combine Pat


and Steve points above and add that FEED scope/limits are quite
flexible depending on Operators Stage-Gate process (EvaluateSelect-Define-Execute process), Decision-Support Package DSP
requirements to pass Gate 3 and get the FID (Firm Investment
Decision).It depends on specific project-business contexts.
Consequently FEED may take from 6-12 months time to do with
wide range of scope and cost to do the FEED. Many Operators rely
much on FEL (Front End Loading), where FEED is a key part, to
achieve project success and life-time assess development
success.
A good quality FEED package includes a good process design
package, plot plans, line lists and key lines routing, equipment
lists and datasheets, control system architecture and shutdown
philosophy, instrument indices, constructability studies, logistics
studies, plant reliability modelling, various construction
specifications, equipment/piping material selection specifications.
Key deliverables of a good FEED include a quality estimate +/15%, a project Level 3 schedule and most important a Tender
Package for the EPC Contract. To fast-track the EPC schedule,
many Operators prefer to tender/award the LL equipment and
packages during the FEED and thus the add many details to key
equipment datasheet and relevant P&I D's.

Fawzy Harraz
answered one year ago
Claudio Costa Jun 22 Reply Like

As far as Instrumentation is concerned, a good FEED package


would also include an I/O count, which is paramount to support
the correct sizing of the ICSS (Integrated Control and Safety
System). Valve and transmitters (flow, pressure, temperature,
level) specifications, as well an Instrumentation, Automation and
Control System Philosophy, and Instrumentation Requirements for
Package vendors are usually included as well.
Fawzy Harraz Jun 22 Reply Like

That's a professional amendment Claudio. Thanks indeed.

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Patrick Campbell answered 1+ year ago

Each owner company defines FEED and Pre-FEED package


contents a bit differently. The key difference between FEED and
Basic Engineering is that a FEED includes a cost estimate suitable
to secure funding for a project. Basic Engineering - as opposed to
Pre-FEED (sometimes referred to as "Select Phase") focuses on a
single design while Select considers options in the basic
configuration. As you are well aware, the quality of the
engineering determines the quality of the estimate.

Patrick Campbell
answered 1+ year ago

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Steve Swanstrom answered 1+ year ago

Great discussion topic. From a supplier point of view, I often hear


client engineers say they are reluctant to request design and
commercial discussions at the FEED stage because of the possible
outcome of the project never getting funded. Most suppliers of
technical products appreciate that respect of time spent on
project work that may never get beyond the FEED stage.
However, some suppliers also welcome the opportunity to be a
resource at an early design stage. This time is usually well spent,
if not on the current project, then with another one. If major
suppliers can get involved in the planning then the project's
outcome can often be enhanced and contribute to on-time
completion and within budget expectations.

Steve Swanstrom
answered 1+ year ago

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Ashish Bandyopadhyay answered 9 months ago

Basic Engineering is the study to identify/ determine concepted


resources based on the Owner's specification/ idea. The
categories could be very basic but are in the sense where the
activites are not frozen or data not available. For example

Area - The area provided by the Owner is sufficient to built the


plant!!!
Location - In which location the area fall i.e. seismology study,
which shall provide the design criteria for the project.
Choice of Process - In the oil and gas industry most of the
processes are frozen. Having said that many different licensors
have developed the processes which have their own pros and
cons. Owner's consent is a must there.
Safety requirements.
Local effluent regulations.

Could be few more to add to the list..... followed by FEED then


developing the BOD to guide and control detailed engineering as
agreed by codes, standards, local regulations and Owner's
discretion.

Ashish Bandyopadhyay
answered 9 months ago

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Joel Sprague answered 9 months ago

And don't forget about another key FEED deliverable that drives
detailed engineering design - Material Selection Diagrams (MSD).
Process data on hydrocarbon constituents, poisons, pH, pressure,
temperature, etc., weight constraints, external environment and
other info is used to select the materials of construction for piping
and fixed/rotating equipment. The MSDs are used to provide
material selection and corrosion allowance details in piping specs
and on equipment data sheets. On the ExxonMobil Hebron
topsides project, extensive use of duplex/super duplex stainless
steels and Titanium was a bit of an overkill from a corrosion
standpoint, but a huge factor in weight reduction.

Joel Sprague

answered 9 months ago

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Joe Valdez answered 1+ year ago

We all know that The FEED is basic engineering which comes after
the Conceptual design or Feasibility study. The FEED design

focuses the technical requirements as well as rough investment


cost for the project. The FEED can be divided into seperate
packages covering different portions of the project. Therefore
there is a blurred boundary between stage engineering and
FEED> Please do not mistake DBM with FEED .
Typically in Large Organisation Business Indent(BI)is identified
based on Proponent Requirements and communicated formally to
Facility Planning Department(FPD),the FPD prepares a Design
Basis scope(DBSP)outlining pre FEED as Basic design to grossly
identify major Equipments and systems for Preliminary cost
estimate(+40%-40% variation)which is further refined as more
basic engineering data are gathered as PFD/P&ID are
finalized.During this stage ERA/HAZOP are conducted.Detailed
cost estimate are identified.nowadays quick and sophisticated
software tools are used.
It also depends where you are in the world. I was surprised in
India to find that the terms are interchangable...this then also
extended to some of my experience in the mid-East. I don't like
the term basic engineering (or pre-FEED for that matter) but it is
less engineering than FEED and typically has a process
engineering focus with major equipment identified from a
mechanical / electrical / instrument perspective.

Average Cost Of A FEED Contract?

From your experience, what is the average cost for a FEED


contract for an onshore green oil field?
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6 Answers
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George Wild answered 3 months ago

I don't think it's possible to give a meaningful answer to that.


There are a number of variables that will effect the price. This
includes:location of engineering centre carrying out the FEED,
duration, extent of studies required (can vary widely), how fixed
or set your concept really is, estimate accuracy / methodology
(for FID). What is the current status of your project?

George Wild
answered 3 months ago
Ysmael Suarez Dec 14 Reply Like

Totally agree with George, cost for a FEED contract will be a


function of multiple variables. The prevailing variables usually are
scope and time frame.

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Gary Palmer answered 3 months ago

The scope drives the number of man hours, the man hours drive
the cost (for FEED the main driver is Engineering man hours).
However as already said, there are too many variables to quote
an average...

Gary Palmer
answered 3 months ago

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NOUMAN HAQ answered 3 months ago

FEED project is mainly driven by level of scope/deliverables and


schedule. Engineering man hours (pertaining to various areas)
mainly drive the overall project cost based on the required
deliverables . However, the cost is also driven by Project Support
man hours (Project Management, Project Controls/Administration,
Doc. Control, etc.).

Man-hours of FEED project could have the following categories


assuming FEED project duration is around 1 year:
Scope/Deliverables required up to 25000 Engineering man-hours
and up to 6000/ 8000 of Project Support man hours.

Scope/Deliverables required from 25000 to 50000 Engineering


man-hours and up to 8000/9000 of Project Support man hours.
Scope/Deliverables required over 50000 Engineering man-hours
and up to 9000/10000 of Project Support man hours.

FEED project phase usually commences when Pre-FEED phase


(estimation, feasibility study, financing structure, FID basis,
shareholding/JV set-up , etc.) completed so overall cost is
planned/budgeted separately for these two phases.

NOUMAN HAQ
answered 3 months ago

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Dean Knowles answered 3 months ago

The other 3 responses are all very valid, as FEED is driven by


manhours. Noting your reference to onshore greenfield project,
another option is to consider FEED as part of overall Tender
submission, through a Design Competition. As highlighted by
Nouman below, one assumes that Pre-FEED may have been a prerequisite, in which then, you may consider to engage bidders into
a paid FEED (CTRs/Manhours to CAP Value/LumpSum) where the
winning bidder will self endorse the FEED for the EPC, given that
handover of FEED is the most contentious component of the EPC
Contract. In such case, then FEED cost will be driven by the
process, as example, if the Design Competition requires Technical
Submission of 9 months, then cost will result in x number of
people x cost per manhour. The other option is to fix the value of
the Design Competition ie Target or Lump sum, then let each
Contractor determine the manhours derived from such value.
Hope this helps as there is many variants or options for such FEED
cost.

Dean Knowles
answered 3 months ago

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Gustavo Adolfo Klein answered 3 months ago

Take these figures as a very rough numbers, but sometimes


useful. The entire (complete) engineering for a large onshore
plant is about 5 to 10% of the total investment, less for larger
plants, complete eng= FEED+ (DE)detail engineering, let say

FEED 1/3 and DE 2/3. , i.e USD 100 MM Plant, 6 MM Engineering,


FEED 2 MM ( 100 USD/Hr eng. cost--->20.000 hrs of FEED), plus
40000 hrs of detail engineering. Take the abovesaid as a "rule of
thumb" (depending of kind of plant, and many other factors).

Gustavo Adolfo Klein


answered 3 months ago
David Simpson Dec 15 Reply Like

Mr. Klein, I have to disagree. When I retired from BP in 2003,


those were very good numbers (i.e., for a gathering project we
would budget 15% of the total project for engineering, permitting,
and surveying). At that time I had never seen a P&ID or attended
a HazOP or Critical Drawing Review for an onshore upstream
project. Today all of those PSM activities are commonplace.
Consequently, it has become common for engineering to be 4050% of total project costs. I did a post-appraisal on a couple of big
upstream facilities projects a couple of years ago--one of them
had 106 drawings/well and the other only had 104 drawings per
well. Prior to 2003 it was common for the only drawings an
onshore well ever had were done in welder's chalk on the side of
a separator. The changes in the last 10-12 years have been night
and day. Every year the cost of FEED increases another
increment, and every year it becomes more common for the
"detailed design" step to ignore the FEED and start over. I discuss
this phenomena at length at ENGINEERING.com in
http://www.engineering.com/DesignerEdge/DesignerEdgeArticles/
ArticleID/8444/New-Processes-are-Needlessly-Reducing-theRecovery-from-Onshore-Gas-Fields.aspx

Plants are probably different, but the question was about field
development.
Gustavo Adolfo Klein Dec 15 Reply Like

Mr.Simpson, hello!, as I said my numbers are very rough, I could


agree that FEED/ or engineering cost rise to 15% or 20%, but half
of the whole Project cost seems to be too high. Of course we are
speaking about EPC onshore and general Plants (O&G, Refineries,
Petrochemicals. Thanks anyway for your comment!

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David Roberts answered 3 months ago

It depends on how accurate a FEED you want and how much


money/time you have.

Why FEED at all; see William Shakespear/Francis Bacons view


(with apologoes) at
http://www.constructioncontractsandclaims.com/petrofac-rccclpresentation.pdf

David a Roberts

David Roberts
answered 3 months ago
Fawzy Harraz Dec 15 Reply Like

Added to the above viewpoints one key factor is the reservoir


fluid; it is gas, oil or light high API crude with associated gas ?; is
it sweet or sour to call for sweetening units ? Is there many design
cases needed to cover reservoir depletion and fluid characteristics
(water cut) ? Do we have gas injection or gas lift systems ? But I
cannot agree with David on 40-50% ratio for the engineering; the
smallest field facilities can have maximum 15-20% of the TIC for
engineering. Finally depending on the scope/quality FEED cost can

go high; some Operators call just for a process design package,


while other call for piping studies and routing, foundations for
major equipment, HAZID/HAZOP and supply specs for major long
lead items (compressors, packages..)
Can't/won't disagree with the above figures. The cost of a FEED
study varies--the question is the validity & need for FEED. My
experience shows that a FEED study will allow the customer to
focus on the project: what is needed, how much, what size; and to
solidify the concepts of the project envisioned. A solid FEED study
is critical to an efficient, well-defined project.

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