In 2006, a large scale energy
infrastructure company (the Company) faced a growing portfolio of
capital projects, including several potential mega-projects. The company
had a solid history as an operator but did not have in-house cost
engineering capability to evaluate and manage such large capital
investments. Significant challenges surrounding estimate accuracy
provided strong motivation to improve. Fast forward to 2018 and the
Company has mature in-house Cost Engineering expertise and an integrated
suite of effective cost estimating and modeling, risk analysis, and
historical project benchmarking methods and tools that are aligned with
AACE® International Recommended Practices. Improvements in estimate
accuracy and performance repeatability have been excellent and
demonstrable. This case study will walk through the evolution from
immature processes and tools, to fully customized, ground-up tools and
finally towards the use of standardized industry tools extensively
calibrated with integrated systems now used to develop estimates for the
multi-billion dollar annual capital spend program. A company
acquisition now presents new challenges. A road map for future
improvement and integration will also be explored.