Department of Mechanical & Industrial Engineering

1. Design of High Strength Low Alloy Steel Natural Gas Transportation Pipeline ( Cost Analysis) Khalid Ahmed Al-Naimi Problem Definition and Objectives This problem analyze different aspects of financial costing of a gas pipeline at a near sea shore location. A simplified method of cost estimation is also presented with assumed values to simulate working environment. Data and graphs are presented to highlight the method and its usefulness. If actual data is inputted, the results are expected to generate reasonable agreement with the established statistics. Design Methodology The economic analysis of the offshore pipeline is based on following important points: Direct cost of installation. Pipe/casing material requirement/available. Design cost and geotechnical investigations cost. Construction inspection cost. Site work access cost. Legal and permit cost. Maintenance and overheads. A realistic cost analysis should take all these points in to consideration before the start of project. Cost benefit analysis and cost effective analysis are the preeminent methods for the economic analysis for decision making Analysis The capital cost of the pipe line depends on four factors namely: Material. Labour. Right of way (ROW) and damages cost. Miscellaneous charges. Conclusion At the start of this project we had little knowledge of pipelines and assumed they were relatively simple and did not vary much from pipeline to pipeline. This assumption was incorrect. When designing this project we realized that it would be near impossible to take into account every scenario for a pipeline. Another hindrance was the lack of support from the suppliers and experts to provide genuine information about the work due to legal issues. It was thought to limit the scope of the paper to a simple pipeline. In our example we ran the program with a design limitation to install 8in. diameter steel pipe for 10 kilometres. There are a number of factors which can seriously effect the cost of the project other than simply the material. The availability of material, transportation, environmental issues, legal and land acquisition issues, labour and taxes can severely effect the whole financial statement of the project. The material selection with accessories and insulation design is pretty much limited to the design requirements for safe and long term operations. As stated earlier, material cost only make up 20% of the total cost . Thus other factors are most decisive factors in the designing and costing of pipeline projects. With this exercise, we have figured out the way to compute the contributions of different variables on the costing and the way the total cost of project is recovered. Provided the correct data, we can generate results which will be of practical importance and comparable with the established facts and figures. Department of Mechanical & Industrial Engineering College of Engineering References: DNV OS-F101, Submarine Pipeline Systems, 2000. Web Sites: www.advancepipeliner.com, and www.pipingengineer.com.