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Project Cost Estimating

Project Cost Estimating

4 days
This course is not scheduled.
Who should attend?


    • Engineers involved in Oil & Gas Downstream projects.


  • Foundation
  • This course provides a thorough knowledge on how to estimate financial risks of Oil & Gas Downstream projects.
Learning Objectives
  • Upon completion of the course, participants will be able to:
  • estimate the cost of a project at its various stages, using an accurate database,
  • evaluate the accuracy of this cost estimate and the main risks of cost overrun,
Course Content


3 days

  • Project Management Process reminder, including deliverables at each stage.
  • Definitions, cost references, AACE classes. Direct and Indirect costs. WBS. CAPEX vs OPEX.
  • Order of magnitude estimate (Chilton factors). Typical accuracy and traps. Localization factors.
  • Factored estimate (Lang/Guthrie factors). Escalation, Nelson-Farrar indices.
  • Cost of main equipment, of works, of engineering services. Owner costs.
  • Semi-detailed estimate, detailed estimate. Key role of engineering studies.
  • Elements needed for final approval by owner and EPC contract endorsement.
  • Adjustments required to these methods in estimating the cost of revamping projects.


1 day

  • Project risk identification and evaluation. Potential impact on cost estimate. Action plan.
  • Allowances and contingencies, evaluation through statistical and deterministic methods.
  • Practical use of the @Risk software for quantitative financial risk assessment.
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Ways & Means
  • Each type of estimating method is illustrated by a practical cost estimating exercise (possibly on Excel).
  • Use of Internet references (AACEI, Oil & Gas Journal, well-known software tools and databases).
  • Group discussions to share feedback experience from participants on actual projects.