Enhancing the value of developing hard-to-recover reserves through project management and tax regulation

As a recommended practice of AACE International, the Cost Estimate Classification System provides guidelines for applying the general principles of estimate classification to project cost estimates (i.e., cost estimates that are used to evaluate, approve, and/or fund projects).The Cost Estimate Classification System maps the phases and stages of project cost estimating together with a generic maturity and quality matrix, which can be applied across a wide variety of industries.This addendum to the generic recommended practice provides guidelines for applying the principles of estimate classification specifically to project estimates for engineering, procurement, and construction (EPC) work for the process industries.This addendum supplements the generic recommended practice (17R-97) by providing:• a section that further defines classification concepts as they apply to the process industries;• charts that compare existing estimate classification practices in the process industry; and • a chart that maps the extent and maturity of estimate input information (project definition deliverables) against the class of estimate.As with the generic standard, an intent of this addendum is to improve communications among all of the stakeholders involved with preparing, evaluating, and using project cost estimates specifically for the process industries.It is understood that each enterprise may have its own project and estimating processes and terminology, and may classify estimates in particular ways.This guideline provides a generic and generally acceptable classification system for process industries that can be used as a basis to compare against.It is hoped that this addendum will allow each user to better assess, define, and communicate their own processes and standards in the light of generally-accepted cost engineering practice.