SEMINAR ON

PIPING COSTING

Presented By
Rajendra M. Bharate
(CEO & Managing Director)
CONCEPTS CLEARANCE COMPANY PVT. LTD.,
18/B3, Bandal Complex, Near PMT Depot, Paud Road, Pune – 38
 BUSINESS PERFORMANCE PARAMETERS

1) Minimum Cost
2) Quality
3) On time Delivery
4) Profits – Return On Investment ( ROI )
5) Meeting Customer Expectation & Satisfaction
6) Competitive Advantage
7) Information ( All Right Factors )
8) Benchmarking – Adherence World Standards
 PARTIES INVOLVED IN PROJECT

1) Owner (Client)
2) Shareholders
3) Financer
4) Licensor
5) Government (Statutory)
6) EPC Contractor (Equipment Vendor)
7) Various Contractors
8) Consultants
9) Detailed Design & Engineering etc..
 PROCEDURE FOR TENDERING

1) Advertisement @ Intention
2) Submission of PQs
3) Evaluation of PQs
4) Issue of Tender to Pre-qualified Bidders (Techno-Com)
5) Submission of Technical Bids
6) Evaluation of Technical Bids
7) Submission of Commercial Bids
8) Evaluation of Commercial Bids
9) Finalization of Contractor & Issue of LOI
10) Contract Agreement
 PRE-QUALIFICATION

1) Company Information
2) List of Directors, Management & Organization Chart
3) List of Clientele
4) Types of Work Done & Same Type of Experience
5) Work Completion Certificates
6) Details of Staff & Workforce
7) Details of Construction Equipments
8) Financial Capabilities from the Bankers
9) Memorandum & Articles of Association (Limited Co.)
10) Balance Sheet for Last 3 Years
 TENDER / BID / PROPOSAL / QUOTATION

Technical Part
1) Technical Terms & Conditions with Deviations
2) Work Methods & Detail Technical Specifications
3) Equipment & Organizational Deployment
4) QA Plans, Planning, Control & Reporting Systems
5) Overall Schedule (Bar Chart)
6) Original Bidding Documents Stamped & Signed
Commercial Part
1) Price Schedule (Schedule of Rates)
2) Commercial Terms & Conditions
3) Rates for Extra Work
 TYPES OF GUARANTEES

1) EMD (Alongwith Tender) (% or Fixed Amount)

2) Advance Payment (10 %)
3) Security Deposit (10 %)
4) Retention Money (5%)
5) Performance Guarantee (10%)
 TURNKEY ASPECT
( LSTK / EPC / EPIC CONTRACTS )

Concept to Commissioning : Single Point Responsibility

1) Project Management
2) Engineering
3) Procurement
4) Quality Assurance
5) Construction
6) Commissioning
 FEW BASIC REQUIREMENTS

1) Types of Projects (Fertilizers, ..)

2) Types of Disciplines (Civil, ..)
3) Types of Works Involved (Piping, ..)
4) Types of Piping (Offsite, ..)
5) Piping Materials (CS, …)
6) Piping Schedules & Weights
7) Pipe Fittings & Valves
8) Fabrication of Pipes from Plates
9) Painting Works (Primer, ..)
10) Insulation Works (Hot, ..)
11) NDT Works (Radiography ..)
12) Testing & Commissioning
 Inch-Mtr (IM) & Inch-Dia (ID)

Inch-Mtr –
When a Pipe of 1 Inch Dia having a length of 1
Mtr is installed, it is termed as 1 Inch-Mtr.
(Ex. 6 Inch Pipe, Length 5 Mtr = 6 x 5 = 30 IM)

Inch-Dia –
When a Pipe of 1 Inch Dia Size is welded having 1
joint, it is termed as 1 Inch-Dia.
(Ex. 10 Inch Pipe, 4 Joints = 10 x 4 = 40 ID)
 ManHour, ManDay & ManMonth

ManHour –
When 1 Worker works for 1 Hour, it is said 1 MH of work.
(Ex. 2 Workers worked 8 Hrs = 2 x 8 = 16 MH)
ManDay –
When 1 Worker works for 1 Day, it is said 1 MD of work
(Ex. 3 Workers worked 7 Days = 3 x 7 = 21 MD)
ManMonth –
When 1 Worker works for 1 Mth, it is said 1 MM of work
(Ex. 8 Workers worked for 5 Mths = 8 x 5 = 40 MM)
 Piping Rates Quotation Basis

1) Per Mtr
2) Per Inch-Mtr
3) Per Inch-Dia
4) Per MT
5) Lumpsum
 Piping Welding Productivity

Normal Figures as per the Average working of

any Company, certain Norms are as below –

a) Shop Floor – 50 - 60 ID / Day / Welder

(Marking, Cutting, Grinding, Tacking etc..)

b) Erection at Site – 25 - 30 ID / Day / Welder

(Laying, Fit-up, Welding, Testing etc..)
 Piping Fabrication from Plates

Normally, above 30 Inch Size Pipes are

Prefabricated out of Plates by Rolling &
Welding.

Plate Bending Machine is very much

important aspect in this Fabrication. It is
Specified as Thk (mm) x Width (Mtr)
 Related Piping Works

• Pipe Supports Fabrication & Erection

• Mitres Fabrication (Tee, Reducer, Elbow ..)
• Insulation (Hot & Cold)
• Sand Blasting (SA 2 ½)
• Painting (Primer, Intermediate, Final)
• Hydro Testing
• Chemical Cleaning etc..
 Various NDT Requirements

• Visual Inspection
• Radiography (X Ray, Gamma Ray)
• DP / MP Testing
• Vacuum Box Testing
• Ultrasonic testing (UT) etc..
 Various Piping Materials

• CS – API 5L, A 106 Gr B (IBR, Non IBR)

• LTCS – A333 Gr 6
• AS – A335 Gr P1, P11, P22
• SS – 304, 304 L, 316, 316 L, 347 H
• GI – IS 1239
• HDPE / Plastic
• C.I. / Cement Pipes
• Cement Lined
 PIPING ERECTION TYPES

a) Unit Piping –
Involved within the plant mostly coming on Equipments & has more
number of welding joints is referred as Unit Piping.
b) Offsite / Rack / Yard Piping –
Involved within the plant mostly on Racks & across the plant, but has
less number of welding joints is referred as Offsite Piping.
c) Cross country Piping –
Out of plant mostly coming across the cities & has naturally less
number of welding joints is referred as Cross-country Piping. (Oil,
Gas, Water)
d) Under Ground Piping –
Involved under the ground / buried may be within or outside the plant
& has less number of welding joints is referred as Underground Piping
 Ratio of Inch-Mtr to Inch-Dia (Appr.)

• Unit Piping – 1.5 to 2.0

• Offsite / Rack / Yard Piping – 3.5 to 4.0

• Cross-Country Piping – 10.0 to 12.0

• Under-Ground Piping – 4.0 to 6.0

 IM & ID Calculations from Isometrics

• Piping Material wise Grouping

• Sizewize Grouping

• Number of Fittings

• Valves (Welded / Bolted)

 Piping Gangs

a) Piping Prefabrication –
Pipe Fabricator, Gas Cutter, Tack Welder,
Grinder, Helper

b) Piping Erection –
Pipe Fitter, Tack Welder, Rigger, Helper

c) Piping Welding –
Qualified Welder, Rigger, Helper
 Weighted Inch-Dia

Piping involves various types of Schedules. To estimate

Man-hours, Consumables etc.. for each Schedule, it is
really a tough task. Hence, all welding Inch-Dia are
converted to a 40 Schedule as a base. On this basis costing
is done, which becomes easier. This is called Weighed
Inch-Dia.

Example –
Size Sch Thk Actual ID Wighted ID
6” Dia 40 6 mm 100”D 100”D
6” Dia 120 18 mm 100”D 300”D
 Material wise Piping Consumables

(Sch 40 as a base) (Rs / Inch-Dia)

• C.S. – 30
• CSLT – 35
• AS – 80
• SS – 125
• G.I. – 10
• PVC / HDPE – 5
 Material wise Piping Rates (Only Factors)

(Considering CS as a base)

• C.S. – 1.00
• CSLT – 1.25
• AS – 2.50
• SS – 3.50
• G.I. – 0.60
• PVC / HDPE – 0.40
 Direct Cost

Direct Labor
Direct Supervision
Consumables
R & M of Tools / Tackles & Vehicles
Rental Charges of Equipments
Power & Water consumption
 Indirect Cost

Administrative Staff
Indirect Labor
Accommodation
Tools / Tackles & Vehicles Depreciation
Insurance
Preparatory Expenses
Travel
Bank Guarantees
General Expenses
Guarantee Obligation
 Total Price

Direct Expenses +
Indirect Expenses +
Material Supplies +
Subcontracting Charges +
Taxes & Duties +
Agents Commission +
Overheads +
Profits
 Section A ( Fill in the Blanks) ( 5 Marks )

1) 6 Inch Size pipe having 15 Mtr length laid on a rack will

have how many total InchMtr of work --
2) 12 Inch size pipe 5 Joints to welded will be having total
-------- Inch dia of work.
3) For Unit piping installed to be in Plant will have Inh-mtr
to Inch-dia ratio approximately ------
4) Pipe Fabrication from Plates is done at site normally
above ------- Inch Size Pipe.
5) Fabrication of Larger diameter Piping Fittings like Tees,
Elbow, Mitre, Reducer etc.. is done on basis of Per -- rate.
(Please mention unit)
 Section B ( State True or False ) ( 5 Marks )

1) 6 Inch Sch 40 CS piping of 2000 Mtr is to be erected as

Offsite Piping & the same quantity is to be erected as Unit
Piping in one Refinery Plant. Then Offsite piping will have
Less number of joints than Unit piping.
2) SS rate will be More than CS of the same schedule.
3) Various Schedules of Piping Inch-dia work is converted
to single unit of inch-dia of work for easy calculation
purpose. This concept is called ‘Weighted Inch-dia’.
4) One welder gang in ‘Erection Site’ will give an average
of 25-30 ID Productivity in a working shift of 8 hours.
5) The Piping, which is involved across cities & has less
number of welding joints, is referred Cross-country Piping
 Section C ( Write Answers in Short ) ( 5 Marks )

1) 5 Welders work for one daily shift of 8 hours per day for
10 days. Calculate total man-hours worked by them.
2) Total work done on one piping job was of 5,200
Manhours. Assuming one ManMonth (MM) of 208
Manhours, find total ManMonths spent on piping job.
3) One piping project has got total workers strength of 100
during its peak period. Find out the total Direct
Supervision strength (Engineers & Supervisors) as per the
normal experience of few standard norms.
4) Write the Elements of Direct Cost.
5) Write the Elements of Indirect Cost.
 Section D ( Full Descriptive Question ) ( 10 Marks )

Shriniwas Constructions Limited, Lucknow (UP)

In one of the Fertilizer Plant near Shahajanpur (UP) some

Piping Work is to be done. Quantity is finalized by the
Petroleum Company Design department & handed over to
Contracts Section for Estimation to find out the Total Cost
involved. They floated the Tender & ultimately ‘Shriniwas
Construction Limited, Lucknow (UP)’ was Selected as a
Final Contractor to Award the Contract being the Lowest
Tender.
Question –
1) Estimate the Total Cost in Rupees, which will be
required to carry out the work, as the Contracts
Department has to get ‘Top Management Approval’.

2) ‘Shriniwas Construction Ltd., Lucknow’ has offered 10

% discount on Total Pricing. Hence, also calculate the
Discount & Final Tender Price in Rupees Separately to
inform to the Top Management.
 Tender for Ammonia Fertilizer, Shahajanpur (UP)

Sr Item Unit Qty Rate Amount

1 Piping Laying IM 3,000 50
2 Piping Welding ID 2,000 100
3 Pipe Support MT 10 2,500
4 Insulation M2 50 100
5 Painting M2 100 50
6 Extra Labor Work Mhrs 200 75
7 Radiography (10%) --- ? 50
8 Commissioning Labor Mhrs 100 50
9 25 T Crane Supply Days 5 2000
10 Enamel Paint Supply Ltrs 10 200