The Study Of Cost Estimation For Offshore Oil EPCI Project

Crude oil is the strategic material and is very critical for all countries worldwidely.The oil exploration is extending from onshore fields to offshore fields. The offshoreoil fields are extending from the shallow water area to the deep water area. The costestimation for the booming offshore oil and gas sector is utmost critical for thecompany engaging in this business.There are a lot of differences among the offshore oil project cost estimation andthe traditional onshore industry business cost estimation. Firstly, the offshore facilitywill sever the oil field for fifteen years facing the typhoon, the acid and high pressurewell flow without the chance to be repaired in the dry dock like the ships. Thissituation results in the high quality equipments are required for the offshore facilityand high cost. Secondly, the single unit lifting weight may reach30,000tons. Thiskind of weight will require some specific offshore barge to be used to install thefacility. These kinds of barges are not abundant worldwidely. The dependence to thesespecific offshore barges will result in high cost, too. Thirdly, the clients intend to signthe contract in the mode of EPCI, which will transfer most of the risks to thecontractor.How to implement the cost estimation for the offshore oil EPCI project andmaximize the profit is a primary goal for the companies involved in this business. Thepaper studies the typical offshore oil project, the cost estimation for these kinds ofproject, the risk identification and mitigation. The bidding strategies and some biddingskills, such as the unbalanced bidding, are also studied in this paper.A sample is enclosed to demonstrate real offshore oil EPCI project costestimation, risk assessment and the final lump EPCI price decision using themethodology studied in this paper.The method mentioned in this paper is also practical for other similar offshore oilEPCI project bidding and cost estimation.