Methodology of life cycle cost with risk expenditure for offshore process at conceptual design stage

Kiil Nam, Daejun Chang, Kwangpil Chang, Taejin Rhee and In-Beum Lee

Energy, 2011, vol. 36, issue 3, 1554-1563

Abstract: This study proposed a new LCC (life cycle cost) methodology with the risk expenditure taken into account for comparative evaluation of offshore process options at their conceptual design stage. The risk expenditure consisted of the failure risk expenditure and the accident risk expenditure. The former accounted for the production loss and the maintenance expense due to equipment failures while the latter reflected the asset damage and the fatality worth caused by disastrous accidents such as fire and explosion. It was demonstrated that the new LCC methodology was capable of playing the role of a process selection basis in choosing the best of the liquefaction process options including the power generation systems for a floating LNG (Liquefied natural gas) production facility. Without the risk expenditure, a simple economic comparison apparently favored the mixed refrigerant cycle which had the better efficiency. The new methodology with the risk expenditure, however, indicated that the nitrogen expansion cycle driven by steam turbines should be the optimum choice, mainly due to its better availability and safety.

Keywords: Life cycle cost; Risk expenditure; Production availability; Risk assessment; LNG FPSO (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0360544211000065
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:energy:v:36:y:2011:i:3:p:1554-1563

DOI: 10.1016/j.energy.2011.01.005

Access Statistics for this article

Energy is currently edited by Henrik Lund and Mark J. Kaiser

More articles in Energy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().