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8/10/2019 BKF4143-PROCESS ENGINEERING ECONOMICS 11213.PDF
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Univers i t i
Ma lays ia
P H N G
Eng i n e e r i n g
r ea t i v I ty
FACULTY O F CH EM ICAL NATURAL RESO URCES ENG INEERING
FINAL EXAM INATION
CO URSE
ROCESS ENGINEERING ECONOMICS
CO URSE CO DE
KF4143
L E C T U R E R
OH]) NOOR B IN NAWI
ANWARUDDIN HISYAM
DATE
0 JANUARY 2013
DURATIO N
HOURS
SESSION SEMESTER :
ESSION
2012/2013
SEMESTER I
PROGRAMME CODE :
K B / B K C I B K G
INSTRUCTIONS TO CA NDIDATE:
This question paper consists of
FIVE (5)
questions Answ er ALL questions
2
All answers to a new q uestion should start on new page
3
All the calculations and assumptions must be clearly stated
4
Candidates are not allowed to bring any m aterial other than those allowed by
the invigilator into the exam ination room
EXAMINATION REOUTREMENTS:
PEE Student's Handbook
DO NO T TURN TH IS P AG E UNTIL YO U ARE TO LD TO DO SO
This exam ination paper con sists of
ELEVEN (11 )
printed pages including front page
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CONFIDENTIAL
KB BKC BKG 12131 BKF4143
QUESTION 1
Formalin is a 37 wt% solution of formaldehyde in water. Formaldehyde and urea are
used to m ake urea-formaldehyde resins that subsequently are used as adhesives and
binders for particle board and plywood.
The Process Flow Diagram, PFD for Unit 800 Formalin production of
58 647
metric
tonnes per annumis shown in
Figure B.7.1.
All the major pieces of equipm ent are
illustrated in
Figure B 7 1
The reactor used is the type of jacketed non-agitated
reactor.
T able B.7.1, B.7.2 B.7.3
provides the inform ation for the Stream , Utility
and Major Equipment Sum maries as shown in
Figure B.7.1.
The following
Table 1
shows bare m odule costs for all major equipme nt:
Table 1: List of equipm ent and its bare module cost,
CBM.
Equipment
Bare Module Co st,
C BM
Methanol Preheater, E-801
$210,456
Air Preheater, E-802
257,890
Reactor E ffluent Cooler, E-803
W
Tower R eboiler, E-804
$315,485
Tower C ondenser, E-805
$310,782
Product Cooler, E-806
$302,896
Feed Air Com pressor, C-801
$205,780
Me thanol Feed Pump, P-801(A/B)
$60,196 X 2
Tower Reflux Pump, P-802(A/B )
$45,560X2
Product Pump, P-803(A/13)
X
Formaldehyde A bsorber, T-801
$1,850,650
FormaldehydeTower, T-802
Y
Formaldehyde Reactor, R-801
Z
Tower Reflux Drum, V-801
$350,950
a) Estimate the bare modu le cost,
C M
for the equipment as per
Table 1?
i)
Reactor E ffluent Cooler, E-803; W
(5 M arks)
ii )
Product Pump, P-803(A B); X
(4 M arks)
iii) Formaldehyde Tower, T-802;Y
(7
Marks)
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CONFIDENTIAL
KB BKC BKG 121311BKF4143
iv )
ormaldehyde R eactor, R-801; Z
5 M ar k s )
Giv en other information as follows:
Reactor Effluent Co oler, E-803:-
Floating-head, shell and tube heat exchanger
Area = 28.16 m2
Material of construction = Carbon S teel.
b
Product Pump, P-803(A B)
Stainless Steel, Centrifugal Electric Driv e
Power0 .5kW
75% efficiency
c
Formaldehyde Tower, 1-802
Material of construction (tower) = Stainless steel
Diameter tower =
2 5 m
Height/Length = 19 in
31 SS siev e trays, 70% efficient trays
Max P ressure rating of 200 kPa
d
Formaldehyde Reactor, R-801
Carbon S teel, Floating head C ounter flow Exchanger
A= 140 .44 m
; Q=8,928 M J/hr; Max P res. Rating = 350 kPa
b)
Estimate the
total bare mod ule costs,
CTM)
and gra ss roots costs, CGR)
for the
facility.
(7
Marks)
c)
Using Chemical Engineering Plant Cost Index (CEPCI) , what w ould be the
C G R
value in year 2011?
2 M ar k s )
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im
to Storage
Tank
P 803A/B
Figure B.7.1
Unit 8 : Formalin Process Flow Diagi:im
OT I
C r Q
t
1
t
L
t
2
C
0
C 801
601A/B
801
802 R 801801802803 E 804
805
a o l P 802 A/B P 503 A/B E 806
Feed Air
ethanol
ethanol
ir
Formaldehyde Formaldehyde Formaldehyde Reactor Towerower
ower Tower Product
roduct
Compressor Feed Pump
reheater Prehealer
Reactor
bsorber
owerffluent Reboiler Condenser Rellux Rellux
Pump
ooler
Cooler
Drum
Pump
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ONFIDENTI L
KB BKC BKG 121311BKF4143
ppen dix B In forma t ion for the Pre l im inary Des ign o f E leven Che mica l Processes
8 5
Tab le B 7 1 S t ream Tab les for Un i t 800
S t re a m N u m b e r
1
2 3
4
5
Temp ( C)
25.00
30.00
40.66
40.78 183 .01
150.00
Fres kPa
101.325 120.00
101.325
300.00
300.00
265.00
Vappr fraction
1. 0
0.0
0.0
0.00
1. 0 1 0
Total kg h
4210.54
2464.75
3120.31
3120.31 145.94
99.92
Total kmol h
1.45.94
76.92
99.92
99.92
4210.54
3120.31
C o m p o n e n t k m o l h
Methanol
0. 0 76.92 94.11
94.11
0.0
94.12
O x
y
ge n
30.66 0.0 0. 0
0. 0
30.66 0 0
Formaldehyde
0. 0
0.0
0.0
0.0 0 .0
0 0
Water
0.0 0 .0 5.81
5.81
0.0
0 0
Hydrogen
0. 0
0.0
0.0 0.0
0. 0
0 0
Nitrogen
115.28 0.0 0.0
0.0
115.28 0 0
S t re a m N u m b e r
8
9
1 0 2
Temp ( C)
200.00
171.94 200.00 100.00
30.00 84.57
Pres kPa 265.00
255.00
185.00
150.00
150.00
140.00
Vapor fraction
1. 0 1.0 1.0
1.0 0. 0 1 0
Total kmol h
145.94 245.86 7330.82
7330.82
2576.15
5354.21
Total kg h
4210.54 7330.85 278 .03
278.03
143.00
224.16
C o m p o n e n t k n io t h
Methanol
0. 0
94.12
31.45 31.45
0. 0
13.35
O x yg en
30.66 30.66 0.15 0.15 0.0 0 1 5
Formaldehyde
0. 0 0.0
62.67
62.67 0. 0 0 0 4
Water 0. 0
5.81 66.82 66 .82
1.43.00 93.68
Hydrogen
0. 0 0.0 1.66
1.66
0. 0 1 6 6
Nitrogen 115.28 115.28 115.28 115.28 0. 0 1 1 5 2 8
con t inued
Table B 7 1: Stream Components
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ONFIDENTI L
KB/BKC/BK G/1 21 31/BKF4J 43
A p p e n d i c e s
9 8 6
Table B 7 1 S t ream Tables for Uni t 800
C o n t i n u e d )
Stream Number
1 3
14
5
Temp ( Q
89.85
75.46
10664
Pres kPa
150.00
130.00
150.00
Vapor mole fraction
0. 0
0.0
0 0
Total kg/h
4552.75
655.56
3897.06
Total kmol/h
196.87
23.00
173.86
Component kmot/h
Methanol
18.10
17.19
0.90
Oxygen
0.00
0.00
0.00
Formaldehyde
62.63
0.00
62.63
ter
116.14
5.81
110.33
Hydrogen
0.00
0.00
0.00
Nitrogen
0.00
0.00
0.00
1 6
7
8
106.71
35.00
73.36
350.00
315.00
120.00
0. 0
0. 0
0.0
3897.06
3897.06
655.56
173.86
173.86
23.00
0.90
0.90
17.19
0.00
0.00
0.00
62.63
62.63
0.00
110.33
110.33
5.81
0.00
0.00
0.00
0.00
0.00
0.00
Table 8 7 2
Ut i li ty Stream F low Su mm ary for Unit 800
E 8 0 1
E 8 0 2
E 8 0 3
8 0 4
mps
hps cw
ps
2063 kg/h
45.43 kg
23,500 kg/h
8,949 kg/h
E 8 0 5
E 8 0 6
R 8 0 1
cw
cw
bfw - mps
775,717 kg/h
7,957 kg/h
3723 kg/h
Tab le B 7 3 Ma jo r Equ i pmen t
Sum mary for Uni t 800
Compressor
D-801 A/B (not shown on PFD)
C-801
Electric/exploSIonProof
kW (shaft)
Carbon steel
W 195kW
Centrifugal
Power = 18 3
95 efficient
continued)
0 efficient
Table B.7.1: Stream Com ponents Continued), Table B.7.2: UtililyStream and Table
B.7.3: Major Equipment
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ONFIDENTI L
KB/J3KC/BKG/12131/BKF4143
Append ix B In fo rmat ion fo r the Pre l im inary Des ign o f E leven Chem ica l Processes
8
Table B 7 3 Major Equipment Summ ary for Un it 800
Cont inued)
Heat Exchangers
E 8 0 1
= 405 in '
1-2 exchanger, floating head, carbon steel
Process stream in shell
Q=4111MJ h
Maximum pressure rating of 350 kPa
E 8 0 2
= 4.62 m2
1-2 exchanger, floating head, carbon steel
Process stream n
tubes
Q = 76 .75 MJ/h
Maximum pressure rat ing of 350 kPa
E 8 0 3
= 28.16 m2
1-2 exchanger, floating head, carbon steel
Process stream in shell
Q
983.23 MJ/h
Maximum pressure rating of 350 kl 'a
Reactors
R-801 Heat-Exchan ger Portion
= 140.44 m2
Counterfiow exchanger, floating head, carbon
steel
Process stream in tubes
Q
8,928 MJ/h
Maximum pressure rat ing of 350 kPa
Pumps
P8O1 A/B
Centrifugal /electric drive
Carbon steel
Power = 0 .3 kW
80 efficient
P-802 AJB
Centrifugal/electric drive
Carbon steel
Power = 1.7 kW
80 efficient
E-804
= 37.3 m2
1-2 excha nger, kettle reboiler, stainless steel
Process stream in shell
Q = 37,755 Mi/h
Maximum pressure rat ing of 250 kPa
E 8 0 5
= 269 m2
1-2 exchanger, floating head, stainless steel
Process stream in shell
32,456 Mj/h
Maximum pressure rating of 250 kPa
E-806
= 41 m
1-2 exchanger, floating head, stainless steel
Process stream in tubes
1169.7 MJ/h
Maximum pressure rat ing of 400kPa
R-80 1, Reactor Port ion
Thin layers of si lver wire gauze suspended
above heat exchanger tube bank
P-803 A/B
Centrifugal /electric drive
Stainless steel
Power = 0 .5 kW
75 efficient
continued)
Table B.7.3 Major Equipment Continued)
7
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CONFIDENTI L
KB BKC BKC 121311BKF4143
9 8 8
Table B.7.3 Major Equipment Summ ary for Unit 800
Con t i nued )
T o w ers
T-801
Carbon steel
10 m of packing
2-in ceramic Bed Saddles
20 theoretical stages
1.00 kPa/m pressure drop
Diameter = 0.86 m
Packing factor = 45
Maximum pressure ra t ing of 300 kPa
Vessel
V-801
Horizontal
Stainless steel
LI
= 4 0
Volume = 4.2
m 3
T-802
Stainless steel
31 SS sieve trays plus reboiler and partial
condenser
70 efficient trays
Feed on tray 18
Reflux ratio = 37.34
0.6096 m tray spacing, 0 .091 in weirs
Column he ight
9 m
Diameter = 2.5 in
Maxim um pressure ra t ing of 200 kl 'a
Whim simulating an entire process we recommend first using the Shortcut:
distillation column within the process for the methanol-Water/formaldehyde dis-
tillation. A rigorous column solver should then be used as a separate item to
simulate the column based on the results obtained from the shortcut column.
However due to the non-ideality of the thermodynamics the actual column sim-
TabLe 8 .7 .4 K va lues for Formaldehyde/W ater /Methano l System [2 ]
P psi a) = 14.696
T C)
Chemical Component
Formaldehyde
Water
ethanol
1
0.123
1.000
0 2 7 3
67.1
0.266
0.491
1 0 9 4
72.1
0.336
0.394
1 4 3 5
7 48
0.374
0.453
1 5 9 8
84.6
0.546
0.607
2359
97.6
0.693
1.105
2 5 8 9
99.9
0.730
1.198
2 5 9 5
150.1
1.220
2.460
3.004
T able B.7.3 Major Equipment Continued)
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CONFIDENTIAL
KB/BKCIBKG/12131/BKF4143
QUESTION
A RM 200,000 process equipmen t loan at 10 interest, compo unded monthly, is
to be repaid in 48 mon thly payments.
a)
W hat is the monthly payment and the total amount repaid?
5 M arks )
b) W hat monthly deposit would have to be m ake-up at the end of eac h month for
48 m onths in order to accumulate a fund of RM 200,000 on the last deposit
date with w hich to purchase this equipment?
5 M arks )
Now, assume an interest rate of 6 compounded monthly is being paid on all
deposits. Wh at is the total of the 48 deposits? C ompare your results with those from
Part (a).
6 M arks )
QUESTION 3
In Hazwani liMP graduate chemical engineer working in Palm Oil Refinery
Plant is ev aluating several alternatives to supply electricity to the plant. N ormally,
she w ill pay RM 5 ,000,000.00 for electricity purchased from Tenag a N asional
Berhad (TNB) for the first year and expect an increase of RM 500,000.00
annually.
Alternatively, she plans to build a 5000 k W P ower P lant. His operating cost for
the power plant are estimated to be RM 180,000.00 per year. So, she is
considering two alternative fuels:
Alternat ive I - WO OD
Installation Cost
Fuel C onsumption
Fuel Cost
Incremental Cost Rate
No Salvage value
RM1500/ kW
30,000 metric tonnes per year
RM50 per ton
RM5 per ton per year after year one
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CONFIDENTIAL
KB/BKC/BKG/12131/BKF4143
Alternative II - OIL
Installation Cost
Fuel Consumption
Fuel Cost
Incremental Cost Rate
No Salvage value
RM1200/kW
56,000 barrels per year
RM5 5 per barrel
RM 3 per barre l per year af ter year one
If interest rate is 12 , and the analysis period is 10 years, perform equivalent
uniform annual worth (EU AW ) analysis on each a l ternative as the fol lowing:
i)
o Nothing (Use TNB supply)
5 M arks)
ii)
s ing Wood or
5
Marks)
iii)
sing Oil?
5Marks)
W hich al ternative should be the best choice for J r . Hazwani?
3 M arks)
QUE STION 4
a The Fermenter for Bioprocess Equipment costs RM 355,000.00 and has an
estimated salvage value of RM 35,000.00 at the end of
years u seful l i fe .
Compute the depreciation schedule for the equipment by;
i)
Straight Line Method (SL)
(2 Marks)
ii ) Double Declin ing Balance Method (DD B)
4 M arks)
iii)
um of Y ears Digit Method (SOYD)
4 M arks)
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ONFIDENTI L
KB/BKC/BKG/121311BKF4143
b) The Company believes the above equipment can give annual receipts of RM
200,000.00 and annual disbursement of RM 120,000.00. Using the same figures as
part (a) with Straight Line Depreciation Method and Corporate Tax Rate of 25 ;
i)
What is the prospective internal rate of return (IRR) before income tax?
5 Marks)
ii)
What is the prospective internal rate of return (IRR) after the taxes?
5 Marks)
QUESTION 5
The cost of capital is the company s cost of using funds provided by creditors and
shareholders. A company s cost of capital is the cost of its long -term sources of funds:
debt, preferred equity, and com mon equ ity
a) What is the difference between IRR and WACC?
5 Marks)
b) Briefly outline the Cost of Capital Processing Steps?
5 Marks)
c) The Plant Design Company will raise capital in the following proportions:
Debt: 40 percent; Preferred stock: 1 Opercent; Comm on stock: 50 percent.
Calculate the weighted average cost of capital, WACC if its cost of debt is
3.6percent, its cost of preferred stock is 8 percent, and its cost of common
stock is 12 percent?
6 Marks)
END OF QUESTION P PER
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