5.1 Capital cost estimate
Wandoan Power's pre-feasibility study estimate is that the Total Installed Cost of thepower station with CO2 capture plant will be $3,773 million based on current costs and exchange rates. The estimate is generally to -20% to +25% accuracy. This means that the final capital cost is expected to be within a range from $3,020 million to $4,720 million.
A major driver of the project's estimated capital cost is the increased cost of doing work in a relatively remote Australian location.and GE have provided most of the information used to develop the estimated capital cost. Their work has been performed to a prescribed standard (AACE Class 4) and is based on the assumption that the project would feature a high level of onsite fabrication.
Preliminary engineering analysis by these firms has indicated some specific cost reduction opportunities:
- increased fabrication offsite,
- site layout adjustments, and
- design modifications to the plant which were conceived during the pre-feasibility study (as discussed in section 2.1).
These cost reduction opportunities, worth in total approximately $200 million and proposed to be investigated in the next phase of development, have been taken into account by Wandoan Power in estimating the Total Installed Cost of $3,773 million.
Further cost reduction may be achieved through some targeted cost reduction activities including value engineering of the design and construction approach (aiming for more modularisation) together with some trade-off analysis of potential alternative project locations and optimisation of scope versus performance requirements.
The makeup of the Wandoan Power TIC Estimate is summarised in the table below:
Table 5-1 Wandoan Power TIC Estimate summary
* Other is 'subcontractor distributables' which includes equipment, overheads and subcontractors' profit.