Turnaround Cost Estimating Rigor

Turnaround Cost Estimating Rigor

Cost estimates for maintenance turnarounds are notoriously inaccurate and frequently overrun by more than their supposed accuracy range. Until recently there has been little research into why this is, and into how to improve turnaround cost estimates. However, there is now a small body of research that may be worth exploring, for those turnaround teams that are interested in continually improving their performance.

Over the decades, there has been considerable effort expended into how to improve the accuracy of capital project cost estimating. Anyone now preparing a cost estimate for a new process plant capital project can draw on a well-established and accepted set of industry norms for how to compile an estimate. This includes standards on the topics of cost estimate classifications, cost breakdown structures, how to deal with uncertainty & risk, how to calculate accuracy range and contingency requirements, and on documenting the basis of the estimate. The majority of these accepted norms are codified in the “Recommended Practices” published by the Association for the Advancement of Cost Engineering – International, or AACE in common parlance. ( https://web.aacei.org/ )

In 2021, I led a small team of volunteers at the AACE to take the concepts from capital project cost estimating and apply them to maintenance turnaround estimating. The initial result has been two Recommended Practices that are now available for anyone in the industry to use. These are:

  • RP 112R-20: Cost Estimate Classification System – As Applied in Maintenance Turnarounds for the Process Industries
  • RP 116R-21: Basis of Estimate – As Applied in Maintenance Turnarounds for the Process Industries

These two Recommended Practices provide very easy to use and simple to apply concepts, both taken from the capital project world and applied to maintenance turnarounds to improve turnaround estimating rigor. They are now available for anyone to use.

I have also contributed to several other Recommended Practices at the AACE, for capital projects. Becht is proud to be actively involved in codes and standards committees throughout our industry. Our subject matter experts use their multidisciplinary knowledge and holistic approach in every project.

Need advice or counsel for estimating costs of your turnarounds?  Contact a Becht expert regarding your future plans.



About The Author

Gordon is a Chartered Chemical Engineer with over 30 years of experience in capital project management and maintenance turnaround preparation and planning. This experience has been gained with owner, contractor and consulting organizations working at onshore and offshore facilities across the globe. Gordon specializes in project and turnaround preparation, planning best practices, and execution control; this includes front-end development, estimating, risk mitigation and change control. He has published a number of articles in technical magazines and several cost estimating recommended practices with the AACE-I. He is a dual-national British/French, residing in The Hague, The Netherlands.

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Turnaround Cost Estimating Rigor

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