CHEM E 485 Process Design I

-★- Chemical Processes Design

Aspen Plus Unit Operations

• Mixers/Splitters

  • Mixer - Mixes 1+ inlets to 1/2 outlet streams. The second outlet is the decant stream based on density.
  • SSplit - Splits flow based on only two outlet parameters (split fraction, flow)
  • FSplit - Splits flow based on many outlet parameters (split fraction, flow, limit flow, cumulative flow)
    • Cannot specify outlet conditions, homogeneously mixed

• Separators

  • Flash - Used for flash drums, evaporators, single-stage separators
    • Cannot specify outlet conditions, determined by thermodynamics
    • Flash2 - Separates feed into 2 outlets (VLE)
    • Flash3 - Separates feed into 3 outlets (VLLE)
  • Decanter - Liquid-liquid separation
  • Separator - Used for single-stage distillation and absorption with known inlet and outlet conditions
    • Need to specify outlet conditions
    • Sep - Separates feed into 2+ outlets
    • Sep2 - Separates feed into 2 outlets

• Exchangers

  • Heater
  • HeatX
  • MHeatX

• Columns

  • Shortcut columns - Used for rapid estimation
    • Assume constant molar overflow and constant relative volatility between light and heavy keys
    • DSTWU - Winn-Underwood Gilliland method
      • Fenske (Winn) equation determines min number of stages $N_{\min}$ and optimum feed location $N_{F, \min}$ at total reflex condition
      • Underwood equation determines the min reflux ratio $(L/D)_{\min}$
      • Gilliland correlation determines the actual number of stages $N$ and feed location $N_F$ at actual reflex ratio $L/D$
    • Distl - Edmister’s method
      • Requires design specification or simulation data from DSTWU
        • Actual number of stages $N$, feed location $N_F$, reflex ratio $L/D$, distillate to feed molar ratio $D/F$, condenser type, and operating pressures of condenser and reboiler
  • Rigorous columns - Used for rigorous simulation
    • Can perform detailed design of column iternals: geometries, hydraulics, packings etc.
    • RadFrac - Used for absorption, stripping, distillation (extractive, azeotropic, reactive)
    • Extract - Used for ternary liquid-liquid extraction
      • Requires thermal specification and stage-wise pressure profile
  • Crude/Petroleum
    • MultiFrac, SCFrac, PetroFrac, ConSep

• Reactors

  • Balance/Stoichiometry-based
    • RStoic - Models given stoichiometry and conversion (extent of reaction) but unknown kinetics and sizing
    • RYield - Models given stoichiometry and yield but unknown kinetics and sizing
      • Satisfies total mass balance, but not component balance (may not satisfy 1st law of thermo)
  • Equilibrium-based
    • REquil - Models reversible reaction assuming max conversion at chemical and phase equilibrium
      • Requires separate liquid and vapor outlets
    • RGibbs - Models chemical equilibrium with minimum $G$ of outlet mixture without given reaction
      • Follows 1st law of thermo
  • Kinetic model-based
    • RCSTR
    • RPlus
    • RBatch

Source: Aspen Plus Simulation Software (NPTEL, Indian Institute of Technology, Guwahati)

Ch 1 Design Process

• Block flow diagram (BFD)

  • Blocks represent unit operations
  • Blocks connected by inputs and outputs with arrows
  • Flow goes from left to right in general
  • Light stream toward top, heavy stream toward bottom
  • Critical info presented (important $T, P$, conversion, yield, chemical reaction)
  • If lines cross, horizontal line is continuous, vertical line broken
  • Simplified material balance provided

• Process flow diagram (PFD)

  • Process topology

    • Process topology - location of and interaction between equipment and process stream

    • Major equipment represented by icons with unique equipment number and descriptive name

    • All streams identified by stream number

    • All utility streams supplied to major equipment provided

    • Basic control loops with important control strategy shown

    • Naming convention: process equipments

      • Abbreviations
        • V - Vessel
        • P - Pump
        • E - Heat exchanger
        • H - Fire heaters
        • R - Reactor
        • C - Turbines/Compressors (trapezoid, shape relative to process stream flow)
        • T - Towers
        • TK - Storage tanks
      • Equipment numbering
        • XX-YBB A/B
          • XX - equipment abbreviation
          • Y - unit number (could be a subunit of a larger plant/process)
          • BB - equipment number of the unit
          • A/B - built in degeneracy (spare equipment) for important locations

    • Non-significant equipment replacement inherits equipment name and number

    • Significant equipment change uses new equipment name and number

  • Stream information

    • Stream number identified in a diamond box

    • Stream direction identified by arrow

    • Naming convention: utility streams

      Electrical component is not shown on PFD as utility streams

      • lps - Low-Pressure Steam: 3–5 barg (sat)*
      • mps - Medium-Pressure Steam: 10–15 barg (sat)*
      • hps - High-Pressure Steam: 40–50 barg (sat)*
      • htm - Heat Transfer Media (Organic): to 400°C
      • cw - Cooling Water: From Cooling Tower 30°C Returned at Less than 45°C
      • wr - River Water: From River 25°C Returned at Less than 35°C
      • rw - Refrigerated Water: In at 5°C Returned at Less than 15°C
      • rb - Refrigerated Brine: In at −45°C Returned at Less than 0°C
      • cs - Chemical Wastewater with High COD
      • ss - Sanitary Wastewater with High BOD, etc.
      • el - Electric Heat (Specify 220, 440, 660V Service)
      • bfw - Boiler Feed Water
      • ng - Natural Gas
      • fg - Fuel Gas
      • fo - Fuel Oil
      • fw - Fire Water

    • Stream flow summary

      • Requires: Stream number, temperature, pressure, vapor fraction, total mass flow rate, total mole flow rate, component mole flow rates
      • Optional: Component mole fraction, component mass fraction, component mass flow rate, volumetric flow rates, significant physical properties, thermodynamic data, stream name

    • Stream identification symbols (stream flag) shows info critical for safety

  • Equipment information

    • Equipment descriptions used for estimate equipment purchase cost
    • Towers: Size (height and diameter), pressure, temperature, number and type of trays, height and type of packing, materials of construction
    • Heat Exchangers
      • Type: Gas-Gas, Gas-Liquid, Liquid-Liquid, Condenser, Vaporizer
      • Process: Duty, Area, Temperature, and Pressure for Both Streams
      • Number of Shell and Tube Passes
      • Materials of Construction: Tubes and Shell
    • Tanks and Vessels: Height, Diameter, Orientation, Pressure, Temperature, Materials of Construction
    • Pumps: Flow, Discharge Pressure, Temperature, ΔP, Driver Type, Shaft Power, Materials of Construction
    • Compressors: Actual Inlet Flowrate, Temperature, Pressure Inlet and Outlet, Driver Type, Shaft Power, Materials of Construction
    • Heaters (Fired): Type, Tube Pressure, Tube Temperature, Duty, Fuel, Material of Construction
    • Other: Provide Critical Information

• Piping and instrumentation diagram (P&ID)

Ch 2 Structure and Synthesis of Process Flow Diagrams

• Hierarchy of design process

  • Decide batch/continuous
  • Identify input/output
  • Identify and define recycle
  • Identify and design separation
  • Identify and design heat exchanger or energy recovery system

• Batch/continuous

  • Batch process - finite quantity of product is made during a time period
  • Continuous process - feed is continuously sent to equipment; outputs continuously sent to storage or further processing
  • Pilot plant is important to gain insight into full-scale operations

    Factor	Batch	Continuous
    Size	➕ Small throughput <500 ton/yr	➕ Large throughput > 5000 ton/yr (economy of scale)
    Product quality/batch accountability	➕ When product quality must be verified and certified (pharm and food)	➕ When off-spec material could be blended or stored and reworked ➖ Could produce large quantities of off-spec product
    Operational flexibility	➕ Same equipment can be used for multiple operations	➖ Inefficient use of idle units ➖ Need retrofitting of plants if demand changes
    Standardized equipment - multiple products	➕ Same equipment can produce different products	➖ Same equipment can only produce designed products
    Processing efficiency	➖ Require strict scheduling ➖ Energy integration not possible - more utility usage ➖ Difficulty separation and recycle	➕ Efficiency increases with throughput ➕ Recycle is easy
    Maintenance and operating labor	➖ Higher operating labor cost (cleaning, preparation)	➕ Lower operating labor cost
    Feedstock availability	➕ When availability is limited/seasonal	➕ When needed in large quantity throughout the year ➖ Seasonal feed need to be stored
    Product demand	➕ When demand is seasonal	➖ Difficult to make other products during off-season
    Rate of reaction to produce products	➕ When reaction rate is slow and need high residence times	➕ When reaction rate is high and need less residence time
    Equipment fouling	➕ When equipment fouling is significant	➖ Fouling is harder to handle
    Safety	➖ Worker exposure to chemicals ➖ Higher operator error	➕ Established safety procedure and record ➕ Less risk with handling chemicals
    Controllability	➖ Controllability is difficulty and complicated	➕ Easier to control

• Input/output

  • Process concept diagram
    • Reactions, side reactions, reactants, products, byproducts
  • Block flow diagram
    • Reactor feed prep, reactor, separator feed prep, separator, recycle, environmental control
  • Process flow diagram
    • Input not consumed in reactor must operate equipment or pass through the process as inerts
    • Outputs must have entered from feed or be produced from reactions
    • Utility streams provide heat or work and do not contact process stream
  • Heuristics
    • Do not separate trace inert impurities before feeding
    • Do not separate impurities before feeding if difficult
    • Purify feed if impurities foul or poison catalyst
    • Purify feed if impurities react to form hard-to-separate or hazardous product
    • Purify feed if impurities is in large quantity

• Recycle

  • Raw material cost is ~25-75% total operating cost
  • ➕ Higher overall conversion, reduce raw material cost
  • ➕ Less waste processing
  • ➕ Less environmental impact
  • ➖ Bigger equipment (larger flow rate)
  • ➖ More equipment (more separation steps)

    Description	Equation	Heuristics
    Single-pass conversion	$\small\dfrac{\text{Reactant consumed in reaction}}{\text{Reactant fed to reactor}}$	$\downarrow$ single-pass conversion, $\uparrow$ recycle flow rate
    Overall conversion	$\small\dfrac{\text{Reactant consumed in process}}{\text{Reactant fed to reactor}}$	$\uparrow$ overall conversion, $\downarrow$ raw material loss
    Yield	$\small\dfrac{\text{Moles of reactant to produce desired product}}{\text{Moles of limiting reactant reacted}}$	$\uparrow$ yield, $\downarrow$ side reaction loss

  • Recycle types
    • Separate feed from product then recycle
      • If separation is easy
    • Recycle feed and product together, with purge stream
      • If not eqm reaction, cannot react further, or inert (avoid accumulation)
    • Recycle feed and product together, no purge stream
      • If eqm reaction, or can react further in reactor

Ch 3 Batch Processing

• Batch processing is unsteady state
• Gantt charts - tables that illustrate a series of tasks (rows) that occur over period of time (columns)
• Flowshop plant - all products use the same equipment in the same sequence, but not the same length of time
• Jobshop plant - not all products use the same equipment or used in the same sequence

Ch 4 Chemical Product Design

• Commodity chemical - manufactured by many companies in large quantity (usually continuous)
• Specialty chemical - made in smaller quantities (usually batch), usually by inventer company
• Product design strategies: needs, ideas, selection, manufacture

Ch 5 Tracing Chemicals through PFD

• Mixer - two or more input streams are combined to form a single stream
• Splitter - a single input stream is split into two or more output streams
  • Same $T, P, x_i, y_i$, Different $\dot{m}, \dot{n}, \dot{V}$
• Primary chemicals - species identified in the overall block flow diagram with chemical reaction
• Primary flow paths - path followed by primary chemicals between reactor and the boundaries of process
• Only reactors converts reactant to product
• Recycle loop - stream in a loop flow so that the flow path forms a complete circuit back to the point of origin
• Bypass stream - streams in a loop flow so that the flow path does not form a complete circuit back to the place of origin

Ch 6 Process Conditions

• The ability to make an economic analysis of a chemical process on a PFD is not proof that the process will actually work
• Stream $T, P, x_i, and y_i$ should be adjusted to process condition before fed into the unit
  • Changing $T, P$ is easier than $x_i, y_i$
• $P \in [1, 10] \ \mathrm{bar}$
  • $P > 10 \ \mathrm{bar}$ - High pressure needs thicker wall, more expensive equipment
  • $P < 1 \ \mathrm{bar}$ - Vaccum conditions needs larger equipment with special construction technique
• $T \in [40, 260] ^\circ \mathrm{C}$
  • $T < 40 ^\circ \mathrm{C}$ - lowest $T$ for water cooling. Cryogenic condition needs expensive construction material and refrigerant
  • $T > 260 ^\circ \mathrm{C}$ - highest $T$ for steam heating. Combustion heater needed
  • $T > 400 ^\circ \mathrm{C}$ - highest $T$ for stainless steeel to have no loss in tensile strength. Equipment needs expensive alloys and refractory-lined

-★- ChemE Economic Analysis

Ch 7 Estimation of Capital Costs

• Classifications of capital cost estimates

  • Economics - evaluation of capital costs and operating costs associated with construction and operation of a chemical process
  • Capital cost - costs of construction of a new plant or modification to an existing plant

  Name	Diagrams	Level of project definition	Purpose	Method	Expected accuracy index	Preparation effort index
  Order-of-magnitude estimate (Ratio/feasibility estimate)	BFD	0 - 2 %	Screening or feasibility	Stochastic or judgement	4 - 20	1 (Lowest) [0.015%, 0.300%] total plant cost
  Study estimate (Major equipment/factored estimate)	PFD	1 - 15 %	Concept study or feasibility	Primarily stochastic	3 - 12	2 - 4
  Preliminary estimate (Scope estimate)	PFD	10 - 40 %	Budget, authorization, or control	Mixed but primarily stochastic	2 - 6	3 - 10
  Definitive estimate (Project control estimate)	PFD, P&ID	30 - 70 %	Control or bid/tender	Primarily deterministic	1 - 3	5 - 20
  Detailed estimate (Firm/Contractor’s estimate)	PFD, P&ID	50 - 100 %	Check estimate or bid/tender	Deterministic	1 (Highest^) [-4%, +6%]	10 - 100

• Estimation of equipment costs

  • Equipment cost attribute (capacity) - equipment parameter used to correlate capital costs
  • Six-tenth rule - equipment without known cost exponent $n$ can be estimated with $n = 0.6$
    • Economy of scale - Larger equipment has lower cost of equipment per unit capacity
    • $n < 1$
  • Cost index
    • Marshall and Swift process industry index
    • Chemical engieering plant cvost index (CEPCI)

  Description	Equation
  Capacity and cost $n \in [0.4, 0.8]$	$\dfrac{C_2}{C_1} = \left(\dfrac{A_2}{A_1}\right)^n$
  Time and cost	$\dfrac{C_2}{C_1} = \dfrac{I_2}{I_1}$
  Time and capacity adjustments	$\dfrac{C_2}{C_1} = \left(\dfrac{A_2}{A_1}\right)^n \left(\dfrac{I_2}{I_1}\right)$

• Estimating total capital cost

  • Total module cost $C_{\text{TM}} = C_{\text{BM}}^\circ + C_{\text{Cont}} + C_{\text{Fee}}$
    • Bare module cost $C_{\text{BM}}^\circ = C_{\text{DE}} + C_{\text{IDE}}$
      • Direct project expenses $C_{\text{DE}} = C_p + C_M + C_L$
        • Equipment free on board (f.o.b.) cost $C_p$ - purchased cost of equipment at manufacturer’s site
        • Materials required for installation $C_M$ - piping, insulation, fireproofing, foundations, structural support, instrumentation, electrical, painting
        • Labor to install equipment and material $C_L$
      • Indirect project expenses $C_{\text{IDE}} = C_{\text{FIT}} + C_O + C_E$
        • Freight insurance and taxes $C_{\text{FIT}}$ - transportation, insurance, and tax cost for shipping equipment to plant site
        • Construction overhead $C_O$ - fringe benefit (vacation, sick leave, retirement benefits), labor burden (social security, unemployment insurance), salary and overhead for supervisory personnel
        • Contractor engineering expenses $C_E$ - salary and overhead for engineering, drafting, and project management personnel
    • Contingency $C_{\text{Cont}}$ - covers unforeseen circumstances: loss of time from weather and strikes, small change in design, unpredicted price increase
    • Contractor fee $C_{\text{Fee}}$
  • Auxiliary facility
    • Site development $C_{\text{Site}}$ - purchase of land; grading and excavation of site; installation and hookup of electrical, water, and sewer system; construction of all internal roads, walkways, and parking lots
    • Auxiliary buildings $C_{\text{Aux}}$ - administration offices, maintenance shope, control rooms, warehouses, service buildings (cafeteria, dressing rooms, medical facilities)
    • Off-sites and utilities $C_{\text{Off}}$ - raw material and final product storage and loading/unloading facility; equipment for process utility; central environmental control facility; fire protection system

  Level 5 cost	Level 4 cost	Level 3 cost	Level 2 cost	Level 1 cost	Definition	Expression in terms of $C_p^\circ$
  Grassroot cost	-	-	-	-	$C_{GR} = C_{\text{TM}} + C_{\text{Aux}}$
  |	Total module cost	-	-	-	$\begin{aligned}C_{\text{TM}} = C_{\text{BM}}^\circ + C_{\text{Cont}} + C_{\text{Fee}}\end{aligned}$	$\begin{aligned}=C_p^\circ (1 + \alpha_M)(1 + \alpha_L + \alpha_{\text{FIT}} + \alpha_L \alpha_O + \alpha_E)(1 + \alpha_{\text{Cont}} + \alpha_{\text{Fee}})\end{aligned}$
  |	|	Bare module cost	-	-	$C_{\text{BM}}^\circ = C_{\text{DE}} + C_{\text{IDE}}$	$=C_p^\circ (1 + \alpha_M)(1 + \alpha_L + \alpha_{\text{FIT}} + \alpha_L \alpha_O + \alpha_E)$
  |	|	|	Direct project expenses	-	$C_{\text{DE}} = C_p^\circ + C_M + C_L$	$=C_p^\circ (1 + \alpha_M)(1 + \alpha_L)$
  |	|	|	|	Equipment	$C_p^\circ = C_p^\circ$	$=C_p^\circ$
  |	|	|	|	Materials	$C_M = \alpha_M C_p^\circ$	$=C_p^\circ \alpha_M$
  |	|	|	|	Labor	$C_L = \alpha_L (C_p^\circ + C_M)$	$=C_p^\circ (1 + \alpha_M)\alpha_L$
  |	|	|	Indirect project expenses	-	$C_{\text{IDE}} = C_{\text{FIT}} + C_O + C_E$	$=C_p^\circ (1 + \alpha_M)(\alpha_{\text{FIT}} + \alpha_L \alpha_O + \alpha_E)$
  |	|	|	|	Freight	$C_{\text{FIT}} = \alpha_{\text{FIT}} (C_p^\circ + C_M)$	$=C_p^\circ (1 + \alpha_M)\alpha_{\text{FIT}}$
  |	|	|	|	Overhead	$C_O = \alpha_O C_L$	$=C_p^\circ (1 + \alpha_M)\alpha_L \alpha_O$
  |	|	|	|	Engineering	$C_E = \alpha_E (C_p^\circ + C_M)$	$=C_p^\circ (1 + \alpha_M)\alpha_E$
  |	|	Contingency	-	-	$C_{\text{Cont}} = \alpha_{\text{Cont}}C_{\text{BM}}^\circ$	$=C_p^\circ (1 + \alpha_M)(1 + \alpha_L + \alpha_{\text{FIT}} + \alpha_L \alpha_O + \alpha_E)\alpha_{\text{Cont}}$
  |	|	Fee	-	-	$C_{\text{Fee}} = \alpha_{\text{Fee}}C_{\text{BM}}^\circ$	$=C_p^\circ (1 + \alpha_M)(1 + \alpha_L + \alpha_{\text{FIT}} + \alpha_L \alpha_O + \alpha_E)\alpha_{\text{Fee}}$
  |	Auxiliary fee	-	-	-	$C_{\text{Aux}}$

• Bare module cost

  • Lang factor technique - used to estimate cost to build major expansion to existing plant
    • $C = F_{\text{Lang}} \sum C_{p, i}$
  • Module costing technique - used to estimate cost of a new plant
    • $C_{BM} = C_p^\circ F_{BM}$
    • Bare module cost - sum of direct and indirect cost based on base case of equipment built with carbon steel at 1 atm
    • Module costing technique protocol
      • Estimate bare module cost of exchangers, pumps, vessels
        1. Calculate bare module cost (2001) $C_{BM} = C_p^\circ F_{BM}$
           1. Estimate equipment cost at base case $C_p^\circ$
              1. $\log C_P^\circ = K_1 + K_2 \log A + K_3 [\log A]^2$
              2. (Table A.1 gives $K_i$)
              3. Figures A.1 - A.17
           2. Identify relationship of bare module factor $F_{BM}$
              1. $F_{BM} = B_1 + B_2 F_M F_P$
              2. (Table A.4 gives $B_i$)
           3. Estimate pressure factor $F_P$
              1. $\log F_P = C_1 + C_2 \log P + C_3 [\log P]^2 \quad (P [\mathrm{barg}])$
              2. (Table A.2 gives $C_i$)
              3. Vessel
                 1. $t = \dfrac{PD}{2SE - 1.2P} + \mathrm{CA} = \dfrac{PD}{2[850 - 0.6P]} + 0.00315 \quad (P [\mathrm{barg}], D[\mathrm{m}])$
                 2. $t_{\min} = 0.0063 \ \mathrm{m}$
                 3. $F_P =\begin{cases} \dfrac{t}{t_{\min}} & P > -0.5 \ \mathrm{barg} && t > t_{\min} \\ 1 & P > -0.5 \ \mathrm{barg} && t < t_{\min} \\ 1.25 & P < -0.5 \ \mathrm{barg}\end{cases}$
           4. Estimate material factor $F_M$
              1. Table A.3 + Figure A.18 - exchanger, pumps, vessels
        2. Calculate bare module cost with CECPI time correction
           1. $C_2 = C_1 \dfrac{I_2}{I_1}$
      • Estimate bare module factor of other equipment
        1. Table A.5 + Table A.6 + Figure A.19 - compressors, blowers, drives, evaporators, vaporizers, fans, fired heaters, furnaces, power recovery equipment, trays, demister pads, tower packing
        2. Table A.7 - conveyor, crystallizers, dryers, dust collectors, filters, mixers, reactors, screens
        3. Calculate bare module cost with CECPI time correction
           1. $C_2 = C_1 \dfrac{I_2}{I_1}$
  Symbol Conventions

  • Cost
    • $C$ - total cost
    • $C_p$ - Purchased cost of equipment
    • $C_p^\circ$ - Purchased cost of equipment at base condition (built with carbon steel at 1 atm)
    • $C_{BM}$ - Base module cost
  • Factors
    • $F_{\text{Lang}}$ - Lang factor
    • $F_{BM}$ - Base module factor
    • $F_P$ - pressure factor
    • $F_M$ - material factor
  • Others
    • $\alpha$ - Multiplication cost factors
    • $A$ - Equipment capacity
    • $B$ - Correlation fitting parameters
    • $K$ - Correlation fitting parameters
    • $S$ - maximum allowable stress for carbon steel = 944 bar
    • $E$ - weld efficiency = 0.9
    • $D$ - vessel diameter [=] m
    • $P$ - pressure [=] barg
    • $\mathrm{CA}$ - corrosion allowance [=] 0.00315 m
    • $t_{\min}$ - minimum allowable vessel thickness [=] 0.0063 m

• Grassroots and total module cost

  • Total module cost - cost of making small to moderate expansion or alteration to existing plant
    • Total module cost = bare module cost + contingency + fee
      • Contingency = 15% bare module cost
      • Fee = 3% bare module cost
  • Grassroots (green field) cost - cost of new facility which the construction is started on undeveloped land
    • Grassroot cost = total module cost + auxiliary facility cost
      • Auxiliary facility cost = 50% bare module cost at base condition

  Description	Equation
  Total module cost	$C_{TM} = \sum C_{TM, i} = 1.18 \sum C_{BM, i}$
  Grassroot cost	$C_{GR} = C_{TM} + 0.5 \sum C_{BM, i}^\circ$

• Plant costs

  Description	Equation
  Total module cost of a plant	$C_{TM} = C_0 \left(\dfrac{F}{F_0}\right)^n$
  Grassroot cost of a plant	$C_{GR} = C_0 \left(\dfrac{F}{F_0}\right)^n$
  Total module cost of parallel plants (trains)	$C_{TM, n\text{ trains}} = C_{TM, \text{train}} (n_{\text{trains}})^{0.9}$
  Grassroot cost of parallel plants (trains)	$C_{GR, n\text{ trains}} = C_{GR, \text{train}} (n_{\text{trains}})^{0.9}$

Ch 8 Estimation of Manufacturing Costs

• Factors affecting manufacturing costs

  • Cost of Manufacturing (COM) = DMC + FMC + GE
    • Direct manufacturing costs (DMC) - vary with rate of production
      • Raw materials - costs of chemical feedstock
      • Waste treatment
      • Utility - fuel gas/oil/coal, electric power, steam, cooling water, process water, coiler feed water, instrument air, inert gas, refrigeration
      • Operating labor - costs of operations personnel
      • Direct supervisory and clerical labor - costs of administrative, engineering, and supportive personnel
      • Maintenance and repairs - costs of labor and materials associated with maintenance
      • Operating supplies - cost of misc supplies that support daily operation but not considered to be raw materials
      • Laboratory charges - cost of routine and special lab tests for quality control and troubleshooting
      • Patent and royalties - cost of using patented or licensed technology
    • Fixed manufacturing costs (FMC) - not affected by rate of production
      • Depreciation - costs associated with physical plant (buildings, equipment, etc). Legal operating expense for tax purposes
      • Local taxes and insurance - costs of property taxes and liability insurance
      • Plant overhead costs (factory expenses) - catch-all costs associated with operation of auxiliary facilities, payroll and accounting services, fire protection and safety services, medical services, cafeteria, recreation, payroll overhead, employee benefits, general engineering
    • General expenses (GE) - management-level and admin activities not directly related to manufacturing
      • Admin costs - salary, other admin, building, and activities
      • Distribution and selling costs - costs of sales and marketing
      • Research and development - costs of research activity related to process and product
  Symbol Conventions

  • Cost
    • $\mathrm{COM}$ - total manufacturing cost
    • $\mathrm{COM}_d$ - total manufacturing cost without depreciation
    • $\mathrm{FCI}$ - fixed capital investment
      • $C_{TM}$ - total module cost
      • $C_{GR}$ - grassroot cost
    • $C_{RM}$ - cost of raw materials
    • $C_{WT}$ - cost of waste treatment
    • $C_{UT}$ - cost of utilities
    • $C_{OL}$ - cost of operating labor

  Description	Equation
  Total manufacturing cost	$\mathrm{COM} = 0.28 \mathrm{FCI} + 2.73 C_{OL} + 1.23(C_{UT} + C_{WT} + C_{RM})$
  Total manufacturing cost without depreciation	$\mathrm{COM}_d = 0.18 \mathrm{FCI} + 2.73 C_{OL} + 1.23(C_{UT} + C_{WT} + C_{RM})$

• Cost of operating labor $C_{OL}$

  • 1 operator = 245 shift/year (49 week/year, 5 shift/week, 8 hour/shift)
  • 1 plant = 1095 shift/year (365 day/year, 3 shift/day, 8 hour/shift)
  • 4.5 operator/$N_{OL}$
  • Wage estimation
    • ✖️ Do not use CEPCI
    • ✔️ Use The Oil and Gas Journal and Engineering News Record
      • 66910 $/year (2080 hour/year) (May 2016, Texas)
      • 32.16 $/hour

  Description	Equation
  Number of operators per shift ★ $P \le 2$	$N_{OL} = (6.29 + 31.7 P^2 + 0.23 N_{np})^{0.5}$
  Number of particular solid process	$P$
  Number of nonparticular processes that are [Compressor, tower, reactor, heater, exchanger]	$N_{np}$

• Utility cost $C_{UT}$

  • Battery limit - boundary of responsibility; PFD only include core unit operations, but not units that generate utilities.
  • Types of fuels
    • Coal - negative environmental impact, used near mines
    • No. 6 fue oil - heavy oil with high sulfur content
    • Natural gas - high regional variation of price
    • No. 2 fuel oil - used near coast, large price fluctuation
    • Electricity - generated by all sources
      • Only electricity can be predicted by CEPCI
  • Utility supply methods
    • Purchasing from public or private utility
    • Supplied by company
    • Self-generated and used by a single process unit
  • Types of utilities
    • Air supply - pressurized and dried air
    • Steam from boilers - process steam providing latent heat
    • Steam generated from process - process steam providing heat
    • Cooling tower water - process cooling water
    • Other water
    • Electrical substation
    • Fuels
    • Refrigeration
    • Thermal system
    • Waste disposal
    • Wastewater treatment
  • Estimate utility cost
    • Capital investment to build a facility to supply utility - use grassroot cost for FCI
    • Table 8.3

• Raw material cost $C_{RM}$

  • Table 8.4
  • Stream factor (SF) - fraction of time that the plant is operating in a year
    • $\mathrm{SF} \in [0.90, 0.96]$

• Waste treatment cost $C_{WT}$

  • Table 8.3

Ch 9 Engineering Economic Analysis

• Investments and the time value of money

  • Goal of manufacturing company: make money
  • Companies produce high value chemicals from low value raw materials
  • Personal income
    • Basic standard of living
    • Discretionary money
      • Consume money for now
      • Retain money for future
        • Simple savings
        • Investments
  • Money makes money when invested.
  • Investment - agreement between investor and producer with the expectation that the producer will return money to the investor at some specified future dates
    • Investor - party providing money $P$ (principal/present value)
    • Producer - party expected to return money $F$ (future value)
    • EQNS
  • Savings - people invest in bank
  • Loan - bank invest in people
  • Money - measure of the value of products and services
  • Value - other units to measure value of products and services
  • Usually, company is investor in project
  • Time value of money - Money today is worth more than money in the future

• Different types of interest

  • Simple interest - amount of interest paid is based only on initial investment
  • Compound interest - interest earned is reinvested

  Description	Equation
  Simple interest	$F_n = P(1 + i_s n)$
  Compound interest	$F_n = P(1 + i)^n$
  Compound interest with changing interest rates	$\begin{aligned}F_n &= P \prod_{j = 1}^n (1 + i_j) \\ &= P(1+i_1)(1+i_2)\cdots(1+i_n)\end{aligned}$

• Time basis for compound interest

  • Nominal annual interest rate $i_{\text{nom}}$ - annual interest rate if compounded per year
  • Actual rate $r$ - interest rate per compounding period
  • Effective annual interest rate $i_{\text{eff}}$ - annual interest rate if not compounded per year

  Description	Equation
  Actual rate ★ $m$ - number of compounding period per year	$r = \dfrac{i_{\text{nom}}}{m}$
  Effective annual interest rate	$i_{\text{eff}} = \left(1 + \dfrac{i_{\text{nom}}}{m}\right)^m - 1$
  Continuous compounding	$i_{\text{eff}} = \exp(i_{\text{nom}}) - 1$

• Annuity and discount factors

  • When cash flows occur at different times, each cash flow must be brought to the same point in time for comparison
  • Annuity - a series of uniform cash transactions taken place at the end of each year for some consecutive years
  • Discount factor - conversion factor converting present, future, and annuity values as a function of $i$ and $n$

  Conversion	Symbol	Common Name	Formula
  $P$ to $F$	$F/P$	Single payment compound amount factor	$(1+i)^n$
  $F$ to $P$	$P/F$	Single payment present worth factor	$\dfrac{1}{(1+i)^n}$
  $A$ to $F$	$F/A$	Uniform series compound amount factor; Future worth of annuity	$\dfrac{(1+i)^n - 1}{i}$
  $F$ to $A$	$A/F$	Sinking fund factor	$\dfrac{1}{(1+i)^n - 1}$
  $P$ to $A$	$A/P$	Capital recovery factor	$\dfrac{i(1+i)^n}{(1+i)^n - 1}$
  $A$ to $P$	$P/A$	Uniform series present worth factor; Present worth of annuity	$\dfrac{(1+i)^n - 1}{i(1+i)^n}$

• Inflation

  Description	Equation
  Purchasing power of future cash	$F' = \dfrac{F}{(1+f)^n} = P(1 + i')^n$
  Effective interest rate	$i' = \dfrac{1+i}{1+f} - 1 = \dfrac{i-f}{1+f}$
  Effective interest rate approximation ★ $f < 0.05$	$i' \approx i - f$

• Depreciation of capital investment

  • Capital depreciation - difference between purchase and installation expense and salvage value

  • Total Capital investment = Fixed capital + Working capital

    • Fixed capital - cost for building the plant
      • Land cannot be depreciated
    • Working capital - capital required to start up the plant and finance the first few months of operation
      • Working capital cannot be depreciated

  • Depreciation metrics

    • Fixed capital investment $\mathrm{FCI_L}$ - depreciable capital investment
      • $\mathrm{FCI_L} =$ (cost to build the plant) - (cost of land)
    • Salvage value $S$ - fixed capital investment minus land evaluated at the end of plant life
    • Life of the equipment $n$ - IRS equipment depreciation time (currently 9.5 years)
    • Total capital for depreciation $D$
      • $D = \mathrm{FCI_L} - S$
    • Yearly depreciation $d_k$ - amount of depreciation in the $k$th year
    • Book value $\mathrm{BV_k}$ - amount of depreciable capital that has not yet been depreciated
      • $\mathrm{BC_k = FCI_L} - \sum d_j$

  • Depreciation methods

    • Straight-line depreciation method (SL) - equal amount of depreciation is charged each year over the depreciation period allowed
      • $d_k^{SL} = \dfrac{\mathrm{FCI_L - S}}{n}$
    • Sum of the years digits depreciation method (SOYD)
      • $d_k^{SOYD} = \dfrac{(n + 1 - k)(\mathrm{FCI_L} - S)}{\dfrac{n}{2}(n+1)}$
    • Double declining balance depreciation method (DDB)
      • $d_k^{DDB} = \dfrac{2}{n} \left[\mathrm{FCI_L} - \displaystyle\sum_{j = 0}^{k-1} d_j\right]$
    • Modified accelerated cost recovery system (MACRS)
      • Use half year convention - equipment is bought midway through first year that depreciation is allowed
      • Most equipment has 9.5 year class life, 5 year recovery period, and no salvage value
      • Use DDB method then SL method when SL yields greater depreciation allowance

  • Taxation, cash flow, profit

    • Federal, state, city, local taxes are high for large corporations
    • Revenue $R$
    • Cost of manufacturing $\mathrm{COM}_d$ - excludes depreciation
    • Depreciation $d$
    • Tax rate $t$
    • Expense = Manufacturing costs + Depreciation
      • $E = \mathrm{COM}_d + d$
    • Income tax = (Revenue - Expenses)(Tax rate)
      • $(R - \mathrm{COM}_d - d)(t)$
    • After-tax = Revenue - Expense - Income tax
      • $(R - \mathrm{COM}_d - d)(1-t)$

Ch 10 Profitability Analysis

• Project cash flow diagram

  • Uses cumulative cash flow diagram
    • Assume land purchase is done at $t = 0$
    • Fixed capital investment ($\mathrm{FCI_L}$) at project construction years
    • Working capital (WC) at plant start-up
    • Teething problem - revenue for first year after start-up is less than subsequent years
    • Assume a working life for profitability analysis
    • Land, working capital, and salvage recovered at ebd of life

• Profitability criteria

  • Time, cash, interest rate

  • Nondiscounted profitability criteria

    • Payback period (PBP) - time required after start-up to recover the fixed capital investment ($\mathrm{FCI_L}$) for the project
    • Cumulative cash position (CCP) - Worth of the project at the end of life
    • Cumulative cash ratio (CCR)
      • $\mathrm{CCR} = \dfrac{\sum \text{Positive cash flow}}{\sum \text{Negative cash flow}} = 1 + \dfrac{\mathrm{CCP}}{\text{Land + WC +}\mathrm{FCI_L}}$
    • Rate of return on investment (ROROI)
      • $\mathrm{ROROI} = \dfrac{\text{Average annual net profit}}{\mathrm{FCI_L}} = \dfrac{\text{Slope startup-to-post-salvage curve}}{\mathrm{FCI_L}} - \dfrac{1}{n}$

  • Discounted profitability criteria

    • Discounted payback period (DPBP) - time required after start-up to recover fixed capital investment $\mathrm{FCI_L}$ for the project with all cash flows discounted back to $t = 0$
    • Net present value (NPV) - discounted cumulative cash position at the end of the project
    • Present value ratio (PVR)
      • $\mathrm{PVR} = \dfrac{\sum \text{Present value of positive cash flow}}{\sum \text{Present value of negative cash flow}}$
    • Discounted cash flow rate of return (DCFROR) - interest or discount rate for which net present value of the project equals to zero (break even)

  • Evaluation of equipment alternatives

    • Equipment with same expected operating lives and operating costs
      • Choose less expensive one
    • Equipment with same expecting operating lives
      • Choose less negative NPV
    • Equipment with different operating lives
      • Capitalized cost method
        • Fund needed to purchase equipment, replace at the end of life, and continue replacing it
        • Do not include operating cost
        • Equipment cost $P$
        • Residual $R$
        • Equipment life $n_{eq}$
        • Capitalized cost = $P+R = P \left[\dfrac{(1+i)^{n_{eq}}}{(1+i)^{n_{eq}} - 1}\right]$
      • Equivalent capitalized cost (ECC) method
        • Yearly operating cost (YOC)
        • Capitalized operating cost = $\dfrac{\mathrm{YOC}(\frac{F}{A})}{(1+i)^{n_{eq}}-1}$
        • Equivalent capitalized cost (ECC) = Capitalized cost + Capitalized operating cost = $\dfrac{P(1+i)^{n_{eq}} + \mathrm{YOC}(\frac{F}{A})}{(1+i)^{n_{eq}}-1}$
        • Residual R = ECC - P - YOC
      • Equivalent annual operating cost (EAOC) method
        • $\mathrm{EAOC} = (\text{Capital investment})(\frac{A}{P}) + \mathrm{YOC}$

-★- Synthesis and Optimization of Chemical Processes

Ch 11 Design Heuristics

• Heuristic - statement concerning equipment sizes, operating conditions, and equipment performance that reduces need for calculations

• Shortcut method - faster method that replaces extensive calculation to evaluate equipment sizes, operating conditions, and equipment performance

• Compressors

  • If $P_{out}/P_{in} > 3$, use multiple stages of compressors (which will raise $T$) and intercooling between compressors
  • If hot inlet gas, cool it before compression

• Heat exchangers

  • Heat integration - use heat generated in one part of the process to heat up other parts
  • If $\Delta T_{lm} > 100 \deg C$, need better heat integration
  • If stream have diff $T$ for mixing, need better heat integration

Ch 12 Reactor and Separation Design Heuristics

• Table 12.1 - choice of separation units
  • Example: separate A, B, C needs $\ge 2$ sep units. need design decisions to optimize cost-effectiveness
    • Sep A, then Sep B and C
    • Sep B, then Sep A and C
    • Sep C, then Sep A and B
  • Almost always need $(n-1)$ separation units for $n$ species
  • Number of ways to configure separation units: $S = \dfrac{[2(N-1)]!}{N! (N-1)!}$
    • Example: separate 4 components, need 3 columns, $S=5$ configurations
• Table 12.2 - choice of sequencing separation units
  • Remove the largest product stream first if possible