Operations Expenditure (OPEX)
From the very early stages of a project, the cost of operating the completed asset is integral to the asset being a viable concern, both economically and sustainably.
In the SELECT phase, the decisions made about major items of equipment and systems have a major effect on Operability, Maintainability, Availability and the costs incurred to keep the asset in a condition which will enable the asset to realise the design intent for the entire design life of that asset.
Making the wrong choices at this juncture can have a devastating effect on the viability of the asset, making the cost of operating the asset significantly more expensive than it needs to be. These choices are often made by the Project Team, with little or no input from Operations and therefore no consideration of the effect their choices will have on OPEX.
Typically, OPEX costs are estimated on the basis of a percentage of the CAPEX cost of the Project, usually somewhere in the region of 2% - 8%. Such an approach is, more often than not, wildly inaccurate and can lead to Projects which are doomed to failure to be given the go-ahead based on these figures.
What is required is a
robust method of establishing a baseline OPEX figure, based on
actual operating costs for the equipment to be installed, to arrive
at an accurate estimate for OPEX that can be updated as more
accurate data is received as the project progresses.
OR&A Cost Evaluation Tool (ORACET)
The OR&A Solution incorporates such a system. The OR&A Cost Evaluation Tool (ORACET) enables an OR&A Team to build an accurate OPEX cost estimate by selecting key items of equipment from a Cost Model Library, building into a full and accurate OPEX cost estimate.
ORACET uses this Activity Based Cost Model (ABCM) approach to evaluate the OPEX costs for each operable and maintainable system on the asset, assigning tag numbers to them as they are added to the cost model, creating a preliminary Asset Register as it is developed.
This method uses a baseline Cost Model Library to assign appropriate operating and maintenance costs to a wide range of equipment, enables new equipment items to be added to the model and the existing values and data to be revised at any point (when more accurate or actual figures can be used).
This methodology also allows a number of models to be developed for any given project, enabling a comparison of alternative configurations to be made.
As the model(s) is (are) built for a specific configuration, the system automatically assigns tag numbers (based on an international numbering standard) to create a preliminary Asset Register for the asset which is then used to guide the design team and exported to the CMMS (along with the relevant cost, spares and manpower data).
ORACET can also produce a range of pre-formatted OPEX reports which contain the necessary detailed cost information for informed decisions to be made.