What is the purpose of cost estimation?
- project viability
- option comparison
- funding approvals
- cost control
- programming/ cashflow
- financial planning
What are different phases of cost estimates?
- feasibility estimate (FE)
- Option estimate (OE)
- Scheme Estimate (SE)
- Pre-design estimate (PE)
- Design estimate (DE)
- Construction Estimate (CE)
What is the accuracy of cost estimates in concept stage?
50%
What is the accuracy of cost estimates in pre-feasibility stage?
30%
What is the accuracy of cost estimates in feasibility stage?
25%
What is the accuracy of cost estimates in preliminary design stage?
20%
What is the accuracy of cost estimates in detailed design
15%
Capital cost estimate - CAPEX
- land acquisition
- pre-feasibility studies
- resource consent
- investigations
- design
- consents + fees
- construction
- supervision
- insurance and taxes
- construction overheads
- inspections, testing
Design fees are dependent on…
project complexity, site constraints, number of options assessed, field investigations, etc
Stages of design, where fees are present:
- concept
- pre-feasibility
- feasibility
- preliminary
- detailed design
Examples of field investigations:
- geotechnical investigations
- geological
- topographical survey
- contaminated site
- hydrological
- water quality
Approvals needed for
- resource consents (technical studies, consent hearing, environment court, management plans)
- property owner conditions of access
- legal fees
General items on a construction cost estimate “bill of quantities”
- P&G
- mobilisation
- management plans and submittals
- misc
- demobilisation
Specific items on a construction cost estimate “bill of quantities”
- earthworks quantities
- concrete volume
- pipes
etc
Operating cost estimate - OPEX may include
- operator fees
- power supply
- maintenance contracts
- materials
- administration
- annual reporting
- monitoring
etc
What is net present value NPV?
The present value of a project based on projected future cash inflows discounted back to current day rates compared to current investment - discounted back to current day rates
Explain an engineers estimate:
- based on bill of quantities
- rates based on experience/ similar jobs and reference materials
- may use an independent QS
What factors would a contractor consider for a earthworks construction cost estimate tender price?
- haul distance
- machine type
- machine numbers
- time of year
- site commute
- grade
What factors would a contractor consider for a materials construction cost estimate tender price?
- standard size
- lead time
- delivery cost
- machinery needed to install
- labour to install
What is the difference between construction cost estimate and tender price?
- contractors margin
- risk assessment
- hunger for the job…
- speciality/ efficiencies not identified by the engineer
- supplier relationship
What are some weighted attributes of a tender evaluation?
- relevant experience and track record
- organisational structure
- resources
- programme
- price
What changes the actual construction cost?
- unforeseen ground conditions
- extreme weather
- design inconsistencies
- supplier delays
What is financial risk assessment?
Probablistic cost estimation - what are the risks to the project - how do these relate to cost - what is the likelihood of each risk Accounts for project risks, cost of risks and probability
Project cost elements included:
- land purchase/ easement
- resource consents
- field investigations
- design
- construction
- regulatory fees
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Consultation28
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Resource Management Act (RMA)27
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Assessment of Environmental Effects (AEE)12
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Wastewater31
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Energy12
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Water Supply21
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Stormwater22
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Project Scoping23
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Cost Estimation24
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Contractors Perspective8
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Asset Management26
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Transport Issues12
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Urban Design16
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Risk Management18
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Safety in Design16
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Sustainability9
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Systems & Causal Loop Diagrams11
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Peer Review11
