1. Capital Cost Estimating @ Fluor
June 2006
Arjen Blok
Chief estimator Haarlem

2. Fluor Overview
Publicly owned engineering, procurement, construction and maintenance company
2005 revenues of $13.2 billion
2005 new awards: $12.5 billion
2005 backlog: $14.9 billion
37,000 employees worldwide
Offices in more than 25 countries
Major European offices:
Haarlem, the Netherlands;
Madrid, Spain;
Camberley,UK; and
Gliwice, Poland.
Consistently one of the world’s safest contractors

3. Presentation purpose EPC contractors current outlook
EPC contractors view on Estimating
Integration of Estimating tools in engineering environment
Aspen Kbase solution

4. EAME Market Summary Strong Upstream Oil and gas markets
Drivers: high prices, reserve replacement, energy supply security, product demand
Thriving LNG and gas processing sector
Complex projects drive increased client capex spending
Up to $50 billion in new contracts expected in ME alone in 2006
National oil companies less reliant on international oil majors
Refining upgrades/capacity expansions, new plants in Middle East
Fluor is pursuing about $20bn in regional prospects
Market focus shifts from clean fuels to conversion
Gas-to-Liquids, Integrated Gasification Combined Cycle
Regulatory environment drives European Union biofuels projects
New Petrochems/Chemicals complexes, primarily in Middle East
Chemical/plastics opportunities developing
Chemical markets may be peaking, downturn expected

5. EAME Market Summary
Power Generators focus on capacity shortages / fuel supply
Carbon Agenda drives environmental upgrades, emissions trading
European Union market deregulation, M&A activity
Nuclear new-build debate
Market risks
Shortage of skilled personnel
Geopolitics / political instability
Feedstock / material costs
Regulatory / environmental issues
Contractor Issues
Record backlog levels resulting in very selective bidding
More lump sum conversion contracts
Pressure on staffing, use of full service low cost engineering centres
Supply chain management, global procurement to contain equipment/ material costs

6. Impact on Operations Selectivity Lump sum conversion contracts
Business risk assessment
Early indication of cost for investment and pursuit decisions
Lump sum conversion contracts
Transparency and accuracy of estimates
Joint development
High focus on contingencies and allowances
Estimate centric execution / Change management
Pressure on staffing  dispersed execution  interfaces
Growth of GEC component, multiple offices
Partnering
National companies
Supply chain management, global procurement for equip. & materials
Price instability & risk
Out of sequence engineering
Increased focus on quantities
Quality
Increased audits, inspection
Reliability is key

7. EPC contractor view on Estimating
Why preparing estimates
Bidding work
EPCm Services
EPC
Service in project development
Support investment decisions
Project execution basis
Capex Cost only
Engineering
Procurement equipment & materials
Prefabrication
Erection (up to Mechanical Completion)

8. EPC contractor view on Cap Cost Estimating
Fluor follows AACE classification rules 18R-97

9. EPC contractor view on Cap Cost Estimating
Estimating tool = AspenTech Kbase
Design estimating tool, provided with
Scope & Construction models, Design rules & Engineering rules of thumb => Quantities
Pricing & labour basis
Estimating scope defined by available engineering data
Equipment data, Flow sheets , Plot Plan, etc
The earlier the estimate, the more use of Kbase technology
Class 4 & 3
Class 2
Replace Kbase models by BE info & execution plan

10. Integrated Design Build SM (IDB)
History Trail
Change Notification
Data Release
Data Ownership
Single Data Entry
Data Status

11. General specifications
Estimating data flow
General specifications
Area Information
Kbase
Equipment data
Utility Systems
P&ID information
Plot plan information

12. Connection IDB -> Kbase
AspenTech solution: API
Application Programming Interfaces
Allows automated data sharing in a controlled manner
Considerations
Quality of data
Ownership of data
Timing / availability of data
Status of data
Revision of data
Timing of activities for engineering disciplines is influenced by estimating

13. Fluor’s API’s Area Manager Equipment API MHCD Aspen Zyqad Electronic
List
Kbase
Utility Systems API
Bulk API
Piping Manual MTO
3D Model
Instrument Manual MTO
INTOOLS

14. Equipment API Obtain Equipment data from Kbase to Excel
Import data from Excel file back to Kbase
Advantages
More simple input of equipment data
Link from Kbase to any obtained excel equipment list
Possibility to make use of applicable data from other electronic sources such as Aspen Zyqad
Aspen Zyqad
Kbase
Equipment API
Electronic
Equipment
List
MHCD

15. Conclusion Market demands us to do it better, cheaper, faster
=> Automation
Estimating has great desire to connect to Engineering
! Controlled manner, considering status of project definition
Engineering should have desire to connect to Estimating
Estimate is Base Line Document
Kbase API’s provide great capabilities
? Can ISO help further developments, considering :
Estimating (in)dependency
Accuracy of an estimate is not driven by details

16. Capital Cost Estimating @ Fluor Thank you for you attention
June 2006
Arjen Blok
Chief estimator Haarlem