Project Management in the Oil and Gas Industry

Example:
Calculate the cost for a project consisting of 3 pumps with 1200 HP, with 
pipeline 10 inches in diameter and a length of 15 miles.
The pump cost estimate = 700 $/HP.
Pump cost = 3 (700) (1200) =2.52 M$.
Cost estimate for onshore pipeline = 14000 $/inch/mile.
Pipeline cost = 14000 (10) (15) =2.1 M$.
Total cost = 2.52 M$+2.1 M$ = 4.73 M$.
Example:
Calculate the cost of one floor for a building with an area of 300 m
2
from 
reinforced concrete.
In this case, assume slab thickness is 250 mm for a slab beam and column 
as a practical estimate.
Approximate concrete quantity for slab and floor = 300 × 0.25=100 m
3
.
Assume the cost of concrete = 200 $/m
3
.
The concrete cost for one floor = $20,000.

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Project Cost Control 121
• Quantity of coarse and fine aggregate and the price per cubic 
meter
• For ready mix, the price of each cubic meter by knowing 
the concrete grade, which is always 30–25 N/mm
2
in petro-
chemical projects
• Cost of shattering, bending bars, pouring, and curing per 
cubic meter of concrete
For ready mix concrete, obtain the following information:
• Quantity of steel in the meter cube of concrete and the price 
of a ton of steel
• The price of concrete from the nearest ready mix location to 
the site and the concrete pump
• The cost of wooden form, which is usually a special strong 
form to the pump concrete
• The cost of steel fabrication
• The cost of the pouring process and curing
Note that in calculating the reinforced concrete cost estimate, the main 
item is the quantity of steel in concrete and it is different according to the 
Calculate the approximate price for one meter cubed of reinforced con-
crete prepared onsite, noting that the approximate quantity of coarse 
aggregate is 0.8 m
3
and fine aggregate is 0.4 m
3
and this value is required 
to provide characteristic cube strength 25 N/mm
2
:
Steel cost = $1000/ton
Cement cost = $80/ton
Coarse aggregate cost = $5/m
3
Sand cost = $1/m
3
Steel quantity = 0.1 t/m
3
as shown in Table (4.2)
Steel cost = 0.1 × 1000
= $100
Cement cost = 7/20 × 80 
= $28
Coarse aggregate cost = 0.8 × 5 
= $4 
Sand cost = 0.4 × 1 
= $1
Material total cost 
= $133/m
3
(as a material only)
Cost of fabrication of wood and steel and pouring = $30/m
3
Total cost 
= $163/m
3

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122 
Project Management in the Oil and Gas Industry
structure element. The following table is a guide for estimating the quantity 
of the steel reinforcement.
The data in Table (4.2) is considered a guideline and depends on the 
concrete characteristics, strength, and the member design, so it is an indi-
cator for the quantity of steel reinforcement.
The percentage cost of the domestic and administration building will be 
a guide as shown in Table (4.3).