Plant Design and Economics

Instructor : Ysacor M/Surafel .

Year : 2013 E.C

Target group : 5th year chemical Engineering students

Lecture -2
 Course outline
UNIT: INTRODUCTION TO PLANT DESIGN UNIT 4: COST BENEFIT ANALYSIS (CBA)
1.1 The need for professionalism and ethics 4.1 Cash-Flow
1.2 General Design Considerations 4.2 Measures of profitability (PBP, IRR, NPV, PI)
1.3 Nature and function of design 4.3 Interests, Taxes and insurance, Depreciation
1.4 Sources of design information and data
UNIT 2: PROCESS DESIGN DEVELOPMENT UNIT 5: SELECTION AND SPECIFICATION OF EQUIPMENT
2.1 Project conception 5.1 Auxiliaries and utilities
2.2 Preparing flow-sheets, Block diagram, process flow 5.2 Material handling equipment
diagrams and standard symbols 5.3 Mass transfer and reactors equipment
2.3 Piping & Instrumentation Diagrams 5.4 Mechanical unit operation equipment
2.4 Material and Energy Balances 5.5 Materials selection

UNIT 3: FINANCIAL & ECONOMIC ANALYSIS OF A PLANT UNIT 6: SITE SELECTION& PLANT LAYOUT
3.1 Types of Capital Investments
3.2 Cost Estimation and Its Techniques UNIT 7: SAFETY IN PROCESS PLANT DESIGN
3.3 Types of Capital Cost Estimates 7.1 Safety and loss prevention
3.4 Factors Affecting Investment and Production Cost 7.2 Environmental and safety considerations
3.5 Cost indexes 7.3 Waste Minimization

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 2.1 Project Conception

 Conception of an industrial project is the initial step in the

process of defining the actual scope of a project
what is a project?
 A project is a well defined task which has a definable
beginning and a definable end that requires one or more
resources for the completion of its constituent activities

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 Chemical Engineering Projects

Chemical engineering projects can be divided into three types,

1. Modifications, and additions, to existing plant; usually carried out by the plant
design group

2. New production capacity(expansion) to meet growing sales demand, and the sale of
established processes by contractors Repetition of existing designs, with only minor
design changes
3. New processes, developed from laboratory research, through pilot plant, to a
commercial process. Even here, most of the unit operations and process equipment
will use established designs

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 The Organization of A Chemical Engineering Project
 The design work required in the engineering of a chemical
manufacturing process can be divided into two broad phases.
Phase 1: Process design, which covers the steps from the initial selection
of the process to be used, through to the issuing of the process flow sheets
and includes the selection, specification, and chemical engineering design
of equipment

Phase 2: Plant design, including the detailed mechanical design of

equipment; the structural, civil, and electrical design; and the specification
and design of the ancillary services

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 Plant Design Project Stages
 A plant-design project moves to completion through a series of stages such as is shown
in the following:
1. Inception
2.Preliminary evaluation of economics and market
3. Development of data necessary for final design
4. Final economic evaluation
5. Detailed engineering design
6. Procurement
7. Erection
8. Startup and trial runs
9. Production
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 1. Inception

This idea may originate in the sales department, as a result of a

customer request, or to meet a competing product, it may be the
result of an orderly research program or an offshoot of such a
program, from the operating division or engineering department.

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 2.Preliminary Evaluation of Economics and Market

 Here, a general survey of the possibilities for a successful process is

made considering the physical and chemical operations involved as
well as the economic aspects
 Next comes the process-research phase including preliminary market
surveys, laboratory-scale experiments, and production of research
samples of the final product
 When the potentialities of the process are fairly well established, the
project is ready for the development phase

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 3. Development of Data Necessary for Final Design

 At this point, a pilot plant or a commercial- development plant may

be constructed
 A pilot plant is a small-scale replica of the full- scale final
plant, while a commercial-development plant is usually made from
odd pieces of equipment which are already available and is not
meant to duplicate the exact setup to be used in the full-scale plant.
 Design data and other process information are obtained during the
development stage. This information is used as the basis for carrying
out the additional phases of the design project.

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 4. Final Economic Evaluation

 A complete market analysis is made, and samples of the final product

are sent to prospective customers to determine if the product is
satisfactory and if there is a reasonable sales potential
 Capital-cost estimates for the proposed plant are made. Probable
returns on the required investment are determined, and a complete
cost-and-profit analysis of the process is developed.

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 5. Detailed Engineering Design

 All the design details are worked out in this phase including
controls, services; piping layouts, price, specifications and designs
for individual pieces of equipment, and all the other design
information necessary for the construction of the final plant
 A complete construction design is then made with elevation
drawings, plant-layout arrangements, and other information required
for the actual construction of the plant

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 6. Procurement, Erection, Startup and Trial-runs, Production

The final stage consists of procurement of the equipment,

construction of the plant, startup of the plant, overall
improvements in the operation, and development of
standard operating procedures to give the best possible
results.
The development of a design project proceeds in a logical,
organized sequence requiring more and more time, effort,
and expenditure as one phase leads into the next

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 Generally the process design includes
1. Literature survey & Patents
2. Process creation
i. mode of operation
ii. Raw material & product specification
iii. Process synthesis
3. Process flow diagram
4. Piping and instrumentation diagram
5. Equipment design and specification
i. Scale up of equipment’s
ii. Safety factor
iii. Equipment specification
iv. Material of construction

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 1. Literature survey & Patents
 In the development of solution to a design need, it is important to make a thorough
search of the literature to obtain the latest data, flowsheets, equipment and simulation
models that may lead to a more profitable design.

2. Process creation
 After reviewing the literature and supporting materials the design engineer creates
a process that will produce a product in a safe and economical way
 In the process of synthesizing a flow of process operations to convert raw
materials to desired products, the design engineer first must select the mode of
operation, raw material & product specification and then synthesizes a step by
step process

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 i. Mode of operation:
batch vs continuous
 Continuous process: more preferred
• Reduced labor cost, improved process control, product
quality and uniformity.
 Batch and semi-continuous process:
• For small production, seasonal product demand, special
ordered product, and product is interspersed b/n other
product.

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 ii. Raw material & product specification
 Here different conditions are established, such as Flow rate,
composition, phase, form(particle size), temperature,
pressure, etc..
iii. Process synthesis steps / Process design
It involves the selection of processing operations to
convert the raw materials to products

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 The Anatomy of A Chemical Manufacturing Process

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 1.Raw material storage:

 Raw materials have to be stored for days or weeks and even for
months to avoid production interruptions so that the plant
operates sustainably.
 The storage requirement depends on the nature of the raw
materials, the method of delivery, and what assurance can be
placed on the continuity of supply.
 In the operation of a process plant adequate storage facilities for
raw materials, intermediate products, final products, recycle
materials, off-grade materials, fuels, cleaning agents, packaging
materials and other items

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 2. Raw material preparation:
 Raw materials preparation and purification is necessary to make the feed
sufficiently pure and are in the right form to be fed to the Physical &
Chemical Material Transformation unit operations.
 Feed contaminants that can poison process catalysts, enzymes, or micro-
organisms must be removed.
3. Material Transformation unit operation:
 The Material Transformation stage is the heart of a chemical
manufacturing process.
 The raw materials are brought together under conditions that promote the
production of the desired product both at the physical transformation unit
or the reactor.
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 4. Product separation:
 The products and byproducts are separated from any unreacted inputs and
undesirable side products after the material transformation units
 If the unreacted inputs are insufficient quality, it will be recycled back to
material transformation units or to the raw material purification and
preparation stage. The byproducts should be also separated from the products
at this stage.
5. Product Purification:
 The main product will often need purification before sale to meet product
specifications. If produced in economic quantities, byproducts may also be
purified before sale.

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6. Product storage:
 Finished product must be held to match production with sales or to store
unsold products. Products must be packed and stored depending on the
nature of the product.
7. Byproduct storage:
 Byproducts require storage.
8. Waste treatment plant :
 Wastes generated particularly from raw material preparation, Product
separation and Product Purification units must be treated before it is
discharged into the environment.
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  Process Feasibility Survey

 In a feasibility survey, process involved must be

considered along with the existing and potential market
conditions for the particular product.

 A preliminary feasibility survey gives an indication of the

probable success of the project and also shows what
additional information is necessary to make a complete
evaluation.
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 The Following is a list of items that should be considered in making a PROCESS
feasibility survey:
 Raw materials (availability, quantity, quality, cost)
 Chemical and physical processes (equilibrium, yields, rates, optimum
conditions)
 Facilities and equipment available at present
 Facilities and equipment which must be purchased
 Estimation of production costs and total investment
 Profits (probable and optimum, based per mass of product and per year
or return on investment)
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 Materials of construction
 Safety considerations
 Markets (present and future supply and demand, price changes, location and number
of possible customers)
 Competition (overall production statistics, comparison of manufacturing processes,
product specifications of competitors)
 Properties of products
 Sales and sale service (distribution, advertisement, technical services)
 Shipping restrictions and containers
 Plant location
 Patent situation and legal restrictions
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 In many cases, the preliminary feasibility survey
indicates that additional research, laboratory or pilot
plant data are necessary and a program to obtain this
information may be initiated.
Process development on a pilot-plant or semi-work
scale is usually desirable in order to obtain accurate
design data for new products

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 By process development the following information are obtained:
 material and energy balances
 process conditions
 yields
 rates
 grades of raw materials and products
 batch versus continuous operation
 materials of construction
 operating characteristics
 and other design variables

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  Comparison of Different Processes
1. Technical factors
 Process flexibility
 Continuous operation
 Special controls involved
 Commercial yields
 Technical difficulties involved
 Energy requirements
 Special auxiliaries required
 Possibility of future developments
 Health and safety hazards involved

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 2. Raw Materials
Present and future availability
 Processing required
 Storage requirements
 Materials handling problems.
3. Waste products and by-products
 Amount produced
 Value
 Potential markets and uses
 Manner of discard
 Environmental aspects

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 4. Equipment
Availability
Materials of construction
Initial costs
Maintenance and installation costs
• For specification:
- Identification, function, operation (continuous or batch),
- Materials handled
(quantity, composition, physical properties).
-Basic design data,
- Essential controls (temperature, air, noise),
- Insulation requirements,
- Allowable tolerances,
- Special information and details are to be given
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 5. Plant location
 Amount of land required
 Transportation facilities
 Nearness to markets and raw material sources
 Availability of services and power facilities
 Availability of labor
 Climate
 Legal restrictions and taxes
 Replacement requirements
 Special designs

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 6. Costs
 Raw materials
 Energy
 Depreciation
 Other fixed charges
 Processing and overhead
 Special labor requirements
 Real estate
 Patent rights
 Environmental controls.
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 7. Time factor
 Project completion deadline
 Process development required
 Occurrence at right time from market standpoint
 Value of money.
8. Process considerations
 Technological availability
 Raw materials common with other processes
 Consistency of product within company
 General company objectives.

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 iv. Types of process design
As soon as sufficient data are available from feasibility survey or process
development the preliminary, detailed estimates and firm designs should
be carried out so that money and time losses are eliminated before the
construction and operation phases .

i. Preliminary or quick estimate designs

ii. Detailed estimate designs
iii. Firm process or detailed designs.

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 • i. Preliminary or Quick Estimate Designs
Preliminary designs are ordinarily used as a basis for
determining whether further work should be done on the
proposed process. The design is based on
 approximate process methods and rough cost estimates are prepared.
 Few details are included and
 the time spent on calculations is kept at a minimum.
The primary step in preparing the preliminary design is to establish the
bases for design. The basic items are;
 the properties of the product and the manufacturing process
 availability and quality of raw material

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  annual operating factor
 energy requirements
 valuable by-products
 The preliminary design must provide the following out put for detailed estimate design;
manufacturing process
material and energy balances
temperature and pressure ranges
raw material and product specifications
yields, reaction rates, time cycles, capacity
materials of construction
utility requirements
 plant site
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 The Detailed estimate leads the accurate estimation of
 required capital investment
 manufacturing costs
 potential profits
Based on these the following factors should be
determined in detailed estimate design stage.
types of buildings, heating, ventilating, lighting, power
supply, drainage, waste disposal, safety facilities and
instrumentation.

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 • ii. Detailed Estimate Designs
 If the results of the preliminary design show that
further work is justified, a detailed estimate design
may be developed.
 In this type of design, the cost and benefit potential
of an established process is determined by detailed
analysis and calculations.
 However, exact specifications are not given for the
equipment and drafting work is minimized.

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 iii. Firm Design or Detailed Design
 At this stage all detailed drawings are prepared and real
investments are determined.
 A complete plant layout (production lines, facilities, etc),
blueprints and instructions for construction are developed.
 Specifications are given for warehouses, laboratories, guard-
houses, fencing, change houses, transportation facilities etc.
 MUST BE DEVELOPED WITH THE ASSISTANCE OF
PERSONS SKILLED IN VARIOUS ENGINEERING FIELDS.

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