KING FAHAD UNIVERSITY OF PETROLEUM & MINERALS Construction Engineering & Management Department CEM-512 Value Engineering Term Project (043) Expansion of Water Treatment Plant Prepared by: Sagar M. AL-Anazi 951602 Sec # 01 Prepared for: Dr. Sadi Assaf Abstract The objective of this report is to demonstrate the value engineering phases in expansion of water treatment plant. How value engineering can assist to remove unnecessary cost and reduce the initial cost of this project. This project is selected among many suggested projects and it is related to my current work in Saudi Aramco Company. August 2005
Transcript
KING FAHAD UNIVERSITY OF PETROLEUM & MINERALS Construction Engineering & Management Department
CEM-512
Value Engineering
Term Project (043)
Expansion of Water Treatment Plant
Prepared by:
Sagar M. AL-Anazi 951602 Sec # 01
Prepared for:
Dr. Sadi Assaf
Abstract
The objective of this report is to demonstrate the value engineering phases in expansion of water treatment plant. How value engineering can assist to remove unnecessary cost and reduce the initial cost of this project. This project is selected among many suggested projects and it is related to my current work in Saudi Aramco Company.
August 2005
Table Of Contents
1. Introduction 2. Information Phase
3. Functional Phase
4. Creative Phase
5. Evaluation Phase
6. Development Phase
7. Implementation & Presentation
1. Introduction The objective of the study was to identify and evaluate areas of opportunity that offer increased project value by providing all essential functions at a lower project cost, or by improving functional performance at little or no additional cost.
Reverse Osmosis Process This is a quick description of Reverse osmosis process.
Feed Pretreatment Process RO Process
Demineralization Process Condensate
Water Tanks
2. Information Phase The Existing Situation The existing plant is unreliable plant and has the following problems:
1. Type of membranes (HFF) is obsolete. 2. There are reliability concerns. 3. High maintenance cost comparing with other RO plant. 4. More chemical consumption. 5. The other water treatment plants (old plants) will be
demolished due to aging. A company has decided to upgrade the existing water treatment plant the (RO Plant) to overcome the existing problems and to produce 1000 gpm industrial water instead of 400 gpm.
Objectives or required Criteria • Expand the existing water treatment plant by providing
16 new RO Units. • Use new type of membranes. • Minimize the chemical consumption. • The plant production should meet the required water
quality.
The original Design
• Install additional pretreatments Equipments. • Install 16 RO Units using SW Membranes to reduce
water TDS to 20 ppm. • Install additional 4 Deminalizers to reduce the TDS to
less than 5 ppm. • Install new Deaerator to remove gases.
Consultation Record
Contact
Major Points
AES RO Vendor
SIDMAS RO Vendor
CSD Saudi Aramco
Cost Data
Cost ($) Unit Price ($) Particular
900,000 150,000 6 Pretreatments Filters
4,000,000 250,000 16 RO Units
500,000 500,000 One Deaerator
4,000,000 1,000,000 4 Deminilizers
150,000 75,000 Chemical Injection Facilities
Tot. Cost = $ 9,550,000
3. Functional Phase
Identify the present Function What does it now do? Item description:
Verb Noun Provide Industrial Water
Support Operations What must it do? Objective or required criteria:
Verb Noun Produce Industrial Water Support Operations
Functional Worksheet
How Function Why
Expansion of the RO Plant
Produce industrial Water
To Support Plant Operations
4. Creative Phase
Generate Ideas:-
• Use Sea water spiral wound membranes
• Eliminate Deminilizeras and related equipments.
• Eliminate Deareator.
5. Evaluation Phase
Feasibility Ranking
Evaluation PhasePotential Cost Benefit
Time to implement
Probability of implementation
Cost to develop
Use Sea water spiral wound membranes
Eliminate Deminilizeras
Eliminate Deareator
Tot. Rank
Feasibility Ranking
2 107710 98 810
10810
343926
213
CEM
-512
VALU
E EN
GIN
EERI
NG
Ideas Comparison
Rank Disadvantage Advantage Idea
3 Required close monitoring
High water quality TDS < 5 ppm
Use Sea water spiral
wound membranes
1 Increase the load on the membranes
Reduction in the costReduction in
chemical consumption
Eliminate Deminilizeras
2 Increase the load on other plants
Reduction in the cost Eliminate Deareator
Determining Weight for Evaluation
Evaluation Phase
A. Initial Cost
B. Operation & Maintenance
C. Reliability
D. Environmental Impact
How Important
3. Major Preference2. Medium Preference1. Minor Preference
Additional Information Additional information was collected to develop the alternatives. 1. Equipments specifications. 2. VE team consulted RO manufactures like Toray (website).
The original Life cycle of Deminilizers The Initial Cost of Deminilizer = $ 1,000,000 Annual maintenance cost = $ 13,000 Salvage value = $ 30,000 Interest rate = 5% Service life = 20 years Then, P = 1000,000+ 13000(12.4622) – 30,000 (0.3769) = $ 1,150,702.0
Item Total Cost Original: Install 4 Deminilizers. $ 4,000,000 Proposed: Eliminate the deminilizers $ 0
1,000,000 30,000 13,000
20 0
Saving in Initial Cost = 4,000,000
Original Life cycle cost (4 demin)= 4,602,808
Proposed Life cycle cost = $ 0
Saving in Life cycle cost = 4,602,808
The original Life cycle of Deaerator The Initial Cost of Deaerator = $ 500,000 Annual maintenance cost = $ 6,000 Salvage value = $ 12,000 Interest rate = 5% Service life = 20 years Then, P = 500,000+ 6000(12.4622) – 12,000 (0.3769) = $ 570,251.0
Item Total Cost Original: Install a Deaerator $ 500,000 Proposed: Eliminate the deaerator $ 0
500,000 12,000 6,000
20 0
Saving in Initial Cost = 500,000
Original Life cycle cost = $ 570,251.0
Proposed Life cycle cost = $ 0
Saving in Life cycle cost = $ 570,251.0
The original Life cycle of RO Unit The Initial Cost of RO Unit = $ 250,000 Annual maintenance cost = $ 8,000 Salvage value = $ 9,000 Interest rate = 5% Service life = 20 years Then, P = 250,000+ 8,000(12.4622) – 9,000 (0.3769) = $ 346,306
The proposed Life cycle of RO Unit The Initial Cost of RO Unit = $ 270,000 Annual maintenance cost = $ 8,000 Salvage value = $ 9,000 Interest rate = 5% Service life = 20 years Then, P = 270,000+ 8,000 (12.4622) – 9,000 (0.3769) = $ 366,306
250,000 9,000 8,000
20 0
270,000 9,000 8,000
20 0
Item Total Cost Original: Install 16 RO Units $ 4,000,000 Proposed: Install 16 RO Units and Use Sea Water Membranes $ 4,800,000
Increase in Initial Cost = $ 800,000
Original Life cycle cost = $ 346,306/Unit = $ 5,540,896
Proposed Life cycle cost = $ 366,306/unit = $ 5,860,896
Increase in Life cycle cost = $ 320,000
Total Saving
Cost ($) Unit Price Particular
900,000 150,000 6 Pretreatments Filters
4,320,000 270,000 16 RO Units
150,000 75,000 Chemical Injection Facilities
Proposed Cost = $ 5,370,000
Original Cost = $ 9,550,000
Saving in Initial Cost = $ 4,180,000
= 44% Reduction
Value Study Proposal VE team recommended the following proposal to design the water treatment plant:- 1. Use sea water membranes. 2. Eliminate the deminilizers. 3. Eliminate the deaerator. The final product of sea water SW membranes will meet the requirement of water quality (TDS will be less than 5 ppm). Also, the new plant production which is 1000 gpm will not be affected by this change. Using sea water membranes will increase the initial cost of the membranes by $ 800,000 but will eliminate the need for deminilizers and dearteator. Proposal Advantages 1. Reduce the initial cost 2. Eliminate unrequited equipments. 3. Minimize chemicals consumption. 4. Reduce the maintenance cost. 5. Safety.
7. Implementation Phase
1. How should it be implemented? VE proposal will be discussed with the engineering and project team to remove any roadblocks prior to management presentation 2. What should be changed and in what sequence? The proposed case will be discussed with engineering team. 3. Who should do it? Engineering department. 4. How long should it take? 5 months 5. Any deadline required? Before issuing the IFC package.
