Various Projects in the country, particularly in the Hydrocarbon Sector are subjected to a two stage approval process which is time consuming and has a history of impacting project viability. This also has an impact on the early project availability which can impact the speed of growth of the country.

In the first stage, typically known as Stage-I approval stage, the intent of the Project - Pre Investment Feasibility Report and its broad viability analysis is presented to the Board /GOI  for clearance and review of recommendations of Pre Investment Feasibility Report. Given the prima facie merits of the Project viability, a Stage II approval is accorded for carrying out following activities as a minimum:

1. Preparation of Detailed Feasibility Report examining various Technology Options and Capital Investment / Financial Analysis for the proposed Project.
2. Licensor selection for Licensed Process Units and process design for various facilities envisaged in the Project, to enable generation of equipment and hardware data for arriving at a (+/-) 10% accuracy level Capital Cost Estimate.
3. Identification of site and collection of data such as Preliminary Soil Investigation, Contour Survey, Availability of Infrastructure / Auxiliary Facilities in close proximity of Project location.
4. Identification of constraints and external interfaces with recommended solutions.

The DFR Schedules typically range between 6 to 9 months, depending upon the project configuration and the upfront involvement and cooperation of licensors to provide information on selected/recommended technologies. Invariably, DFR Preparation is carried out by conducting preliminary designs and broad estimation of equipment etc involved in the various facilities of the Complex, rather than taking recourse to actual process design of facilities envisaged in the Complex.

After submission of DFR, Projects have known to tread a rather uncertain course where time if often a causality.  On the brighter side, there are instances where Projects have been approved for investment in a short period of 4-6 months, but generally final investment approval Stage-II Approval has often been found to be delayed. For Mega complexes entailing investments of over Rs. 60,000 to Rs 100,000 crores, such delays can be deleterious not only to overall health of the project, but sometimes may impact the very relevance and viability of the Project. Given the adverse impact these delays can have on Project viability, obsolescence of technology and inflationary pressures are other factors to be contended with. It is imperative therefore, that the time span between DFR submission and investment approval should be minimised. It may not be out of place to mention, that in these stages of the project it is the service component only which is under question, as no hardware commitment is to be made. Consequently it would be useful to utilise the intervening period between Stage-I clearance to Stage-II clearance and further between submission of DFR to investment approval that some front end work is initiated, without any hardware commitment, to save on precious project implementation schedule.

Activities to be overlapped between Stage I & Stage II approval of Projects

Given the fact that GOI has already identified Maharatnas / Navratnas in the Hydrocarbon Segment, a Pre Investment Decision prior to the Stage-II clearance i.e. expenditure in excess of the limits imposed along-with Stage-I clearance of the Project could be taken up by the respective Boards of Owners as an initiative to save on Project Schedule considering that the investment against the activities to be undertaken would be predominantly design driven without any tangible financial commitment against physical assets.   Possibly a soft investment to the tune of 1% of the total Capital Cost envisaged for a Mega Grassroots Project only would be warranted to enable a schedule saving of 12-14 months on the overall project time cycle by carrying out Front End Engineering Detailing which is vital for initiating vertical Project Implementation.

Various measures such as deferred payments, post facto adjustments could also be explored between the Owner and the Consultant pending formal Board Approval. The essential part is to ensure, that this activity is initiated immediately after Stage I approval of the project.  The major activities that need to be initiated are enlisted below. The activities listed pertain only to those items, which have a direct bearing on schedule and could prove crucial for initiating a head-start to the Project.

1. Freezing Complex design basis and crude assays.
2. Plant simulation and Process Design of all Open Art Units to finalise Material Balances and BDEP (Basic Design Engineering Package).
3. Technology selection for licensed Units through NIT process for carrying out Process Design of various Process Units.
4. Design Conferences with the licensors and preparation of Basic Engineering Design Packages.
5. Preparation of Utility and Offsite Design Basis and BDEPs.
6. Completion of Soil Investigation and Site Surveys for contour mapping and grid pillar marking on selected project site.
7. Preparation/Finalisation of Plot Plan to incorporate the following:
   • Identification of all major facilities in the Complex to establish synergy between Process Units and Auxiliary Facilities. Identify all heavy lifts and plan for crane assembly, movement and rigging of Equipment and modules.
   • Identification of Water blocks to ensure minimisation of Piping lead lengths both  underground and above ground
   • Identification/location of the steam and power generation facilities in the complex to minimise steam line leads. Locate multiple substations and Switchyard for Power Distribution and control.
   • Align the plant controls and distributed control Philosophy if so envisaged.
   • Identification of ERCs/IRCs/Pipe Culverts/Pipe-way Bridges, heavy crane movement roads in advance to ensure sustained and uninterrupted, logistics management at site.
   • Identification of overall Pipe-rack/sleeper tracks in the Complex. Identify all Instrumentation and Electrical Ducts and Trays arrangement.
   • Identification of overall flare trestle corridor in the Complex. Align Flare KODs. Intermediate KODs to minimise Pipe-rack Elevations.
   • Identify Overall Fire Water Network, fire stations and Firewater Pump Stations. Integrate water reservoirs and evolve/schematics for the same.
   • Identify Raw water and Water treatment plants, water Recycling facilities
   • Identification of all major underground piping corridors along with location of pumping systems near the Unit battery limits to eliminate all gravity piping in offsite.
   • Preparation of site development plans, terracing and estimation of quantities.
   • Identification of Plant and Non Plant Buildings Layout
8. Thermal Design of Heat Exchangers, Air Coolers and API data sheets for furnaces and incorporation of all results in P&Ids.
9. Finalisation of equipment layouts for Process units at PFD stages to enable Process design/Hydraulics to be carried out on dimensioned layouts.
   Additionally, Equipment layouts to account for the following:
   • Composite Vs RCC structures for Pipe-rack and Technological structures.
   • Finalisation of heavy lift locations.
   • General Arrangement of Compressors houses along with maintenance plan.
   • General Arrangement of Furnaces and sub pipe--racks.
   • General Arrangement of Critical packages eg FCC Reactor/Regenerator, CCR Reactor Furnace / Regenerator arrangement, Hydrogen Reformer etc.
   • Location of Heavy lifts, High pressure reactors and HP exchanger Trains.
   • Identifications of Hard stands and routing of major above ground and underground piping headers.
   • Development of conceptual rigging schemes
   • Firming of Single Line Diagrams Overall Electrical Trench / Aboveground Tray layouts. Finalisation of Unit Substation Location/layout.
   • Finalisation of Plant DCS Architecture and location of MCR and SRR.
   • Finalisation of Unit maintenance Block and location.
10. Preparation of OSBL/ISBL Utility Distribution P&IDs
11. Mechanical Design of Pressure Vessels and Development of plate MTOs for tankages, spheres and mounded storages.
12. Estimation of cement, steel, reinforcement quantities.
13. ODC route survey, water and power source and surveys.
14. Pre-qualification of vendors and preparation of bid documents for critical LSTK Packages.
15. Upstream Planning for Crude Receipt and Product Despatch.
16. Finalisation of communication linkages between site and Head Office.
17. Identification of critical construction resources and machinery required for implementation of Project to be procured by Owner.
18. Firming of Project Procurement, Tendering, co-ordination procedures.

The above as may be inferred are all soft activities involving essentially Engineering and Licensing efforts. This is insignificant n the overall gamut of project framework but can have considerable impact by providing an upfront head start to a project, particularly Mega Projects where as much as 12-14 months could be saved in the overall implementation cycle of the Project. Surely a great plus!

Most of what is stated above is purely from personal experience in the Hydrocarbon Industry operating in PSU domains. Things in the Private sector could be a little different where Managing Licensor Concepts could be a factor to be additionally considered for the benefit of the Project schedules.

For the New Projects in Coal to Chemicals, Integrated complexes, Fertiliser complexes, Large scale Green Hydrogen/Green ammonia projects all these principles with little modification could be made use of. For a Nation which is at the cusp of a radical transformation saving time on the front end activities is a pre requisite!

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