2000 at a total investment cost of AUD400 million and has an annual capacity of 1.5...

 

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2000 at a total investment cost of AUD400 million and has an annual capacity of 1.5 million tons. As pant of its expansion plan, the company is considering to build a same plant but with a smaller capacity of 0.5 million tons per annum in Brunei Darussalam The following data is available: 2016 2000 108.1 Annual Plant Cost Index 106.2 Brunei Darussalam Australia 1.14 Location factor 1.07 (a) Estimate the cost Company QBY would have to pay in order to build the plant in Brunei Darussalam in 2016 using the Capacity Ratio method, assuming a capacity factor or cost exponent value of 0.7 (12 marks) (b) What would be the level of accuracy of your cost estimate using above method? (3 marks) (c) Briefly describe two types of information that would significantly improve the accuracy of your cost estimate above. (5 marks] (d) What should the level of accuracy of a cost estimate be at the time of awarding major contracts and taking final investment decision (FID) for a project? Give your reason 2000 at a total investment cost of AUD400 million and has an annual capacity of 1.5 million tons. As pant of its expansion plan, the company is considering to build a same plant but with a smaller capacity of 0.5 million tons per annum in Brunei Darussalam The following data is available: 2016 2000 108.1 Annual Plant Cost Index 106.2 Brunei Darussalam Australia 1.14 Location factor 1.07 (a) Estimate the cost Company QBY would have to pay in order to build the plant in Brunei Darussalam in 2016 using the Capacity Ratio method, assuming a capacity factor or cost exponent value of 0.7 (12 marks) (b) What would be the level of accuracy of your cost estimate using above method? (3 marks) (c) Briefly describe two types of information that would significantly improve the accuracy of your cost estimate above. (5 marks] (d) What should the level of accuracy of a cost estimate be at the time of awarding major contracts and taking final investment decision (FID) for a project? Give your reason

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a Cost of Building new plant in Brunie Darussalam in 2016 By Capacity ratio Method Cost of Inve... View the full answer