CPE 520

PROJECT MANAGEMENT

MINI PROJECT REPORT

CLASS: EH3304I

GROUP MEMBERS:

1. JULIA BINTI FADZLI 2017632064

2. NURFARAH AQILAH BINTI ZAINI 2017632126
3. SITI NUR AISHAH BINTI MOHAMAD FAUDZI 2017632136
4. NURLINA SYAHIIRAH BINTI MD TAHIR 2017632214
5. QURRATUAINI BINTI MD ALI 2017632078
6.

SUBMITTED TO: SIR FITRI OMAR

DATE OF SUBMISSION: 12 JUNE 2018

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TABLE OF CONTENTS

1.0 INTRODUCTION........................................................................................................... 2
1.1 INTRODUCTION TO COMPANY NAME................................................................. 2
1.3 INTRODUCTION TO LOCATION ............................................................................ 9
2.0 MARKET ANALYSIS AND MARKET STRATEGIES ............................................... 13
2.1 INTRODUCTION TO FEASIBILITY STUDY OF MARKET, PROCESS AND
TECHNOLOGY .............................................................................................................. 13
2.2 TARGET MARKET ANALYSIS .............................................................................. 13
2.3 LOCATION ANALYSIS........................................................................................... 14
3.0 PROCESS ANALYSIS ................................................................................................. 15
3.1 PROCESS SELECTION............................................................................................ 15
3.2 PROCESS BACKGROUND ..................................................................................... 16
3.3 EQUIPMENT ............................................................................................................ 17
3.4 TECHNOLOGY ........................................................................................................ 19
4.0 COMPANY SET-UP .................................................................................................... 20
4.1 COMPANY ORGANIZATION ................................................................................. 20
4.2 JOB DESCRIPTION ................................................................................................. 20
5.1 ACTIVITY / WORK PACKAGE DURATION ......................................................... 29
5.2 PROJECT SCHEDULE ............................................................................................. 30
5.3 CRITICAL PATH ANALYSIS ................................................................................. 30
6.0 BUDGETTING ............................................................................................................. 35
7.0 PROJECT TERMINATION .......................................................................................... 40
8.0 CONCLUSION ............................................................................................................. 48

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1.0 INTRODUCTION
1.1 INTRODUCTION TO COMPANY NAME

Figure 1 – Company logo

The increasing in high demand of customers, and from other companies has lead in the
establishment of Malaysia Methanol Chemical Technology (MMCT) Sdn Bhd as a semi-
government company in distributing methanol in Malaysia. In establishing this company,
project manager had to meet the project sponsors and stakeholders to discuss our needs and
expectations in establishing our project scope, budget and timeline. Project plan had been
documented and details of scope, time and budget had been finalized. As discussed with the
stakeholders, we prioritized their needs and have specified our project goals. After regular
meetings and discussion, we had come to conclusion in establishing a company on methanol
based as it is highly demand in Malaysia. Based on the idea of producing methanol, we created
a project schedule. After series of considering the risks, management and expectations of our
company, we presented our project plan to our stakeholders. The stakeholders agreed in helping
us in establishing MMCT Sdn Bhd. We are proud to say that production of methanol has never
fail in local market and worldwide due to its demand. Methanol is highly marketable as many
companies have created technology that are methanol based such as in aerosol, door insulation,
manufacture of dyes and plastics, also in transportation (Methanol as a fuel).

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1.2 INTRODUCTION TO PRODUCT

i. Methanol Production

The first product proposed was production of methanol. The annual production of
methanol exceeds 65 million tons and continues to grow per year. Methanol has traditionally
been used as feed for production of a range of chemicals including acetic acid and
formaldehyde. In recent years methanol has also been used for other markets such as production
of dimethyl ether (DME) and olefins by methanol-to-olefins process (MTO) or as blend stock
for motor fuels. From the annual production estimated, Malaysia produced about 3% of
methanol in Asia-Pacific region in the year of 2012. The duration for the construction to finish
is 2 years and 4 months as estimated in the time management section in this report.

Production method of methanol is through the synthesis of methanol from carbon

dioxide gas, CO2. For this process, used carbon dioxide gas, CO2 and hydrogen gas, H2 as our
raw materials. Instead of producing the raw materials on our own, it will be more cost saving
to buy the raw materials from nearby industry and there will be lesser maintenance of
equipment. There are two methods used in this synthesis process which are direct method and
two step method.

Direct method : CO2 + 3H2 → CH3OH + H2O

Two step method : CO2 + 2H2 → CO + H2O

CO + 2H2 → CH3OH

For our company, we will select two step method because we can obtain methanol
directly without water as by-product. This production of methanol can be increase by the
presence of catalyst which is copper or zinc oxide. Process conditions with temperature of
210οC – 270οC and pressure 50-100 bar. For CO2, the gas enters at temperature of 25 οC and
pressure which of 1 bar while hydrogen gas enters at 25 οC and 1 bar. Then the following gasses
are compressed at 78 bar. This process starts when the carbon dioxide and hydrogen enter the
stream to reverse water gas shift (RWGS) reactor. At the RWGS reactor, CO2 is converted into
carbon monoxide gas, CO then CO and water are separated at the distillation column which
water will be coming out from the bottom of column and CO will be coming out at the top of
the column which then enter the compressor and react with hydrogen gas before entering the

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reactor. In the end of the process, the product exit at the bottom of the reactor then enter
separator which comes out at the outlet stream.

Other than that, there are increasing in demand of methanol from the customers. This
is because; methanol is the largest feedstock for applications such as plastics iindustries.
Methanol applications also includes as aerosol, door insulation, manufacture of dyes and
plastics. One of them includes production of polymers such as polyesters which uses methanol
as its original raw material. A variety of plastics produced based on the reactions from the
methanol with phenol, a white crystalline solid that is easily evaporated at a normal
temperature. The total operation and production costs of methanol is RM 13,722,987. The
company estimated a payback period within 5 years, which then deduce that the annual payback
needed to satisfy this period is approximately RM2,744,597.40

There are not many company in Malaysia that produces methanol. The largest
production of Methanol is in Labuan which is far away from the Peninsular Malaysia. The
production of methanol in Peninsular Malaysia is lacking, thus the idea to produce methanol is
good, whereby Peninsular Malaysia as our target market which includes regions that is
currently developing such as Terengganu, Pahang, Kuala Lumpur and Johor.

According to the chart of Malaysia’s annually petrochemical feedstock in Malaysia for

a plant, production of methanol is by 660,000 million tonnes per year in Labuan. This shows
that Methanol highly demand in Malaysia. Besides, in worldwide production of methanol is
also high. According to Methanol Market Service Asia (2014), the annual production of
methanol are as follows:

Table 1 – Annual production of Methanol for various country in 2014

Country Annual production of methanol

Europe 2.6 million tonnes
US 2.8 million tonnes
Middle East 14 million tonnes
SE Asia 4.8 million tonnes
China 35 million tonnes
South America 10 million tonnes

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ii. Styrene Production

Next, new product opportunity identified is production of styrene. Styrene is the

precursor to polystyrene used in plastics, protective coatings, polyester, resins and chemical
intermediates. The most common method for styrene production is catalytic dehydrogenation
which used ethylbenzene as the raw material. The company propose production of styrene as
one of the chemical to be considered for the new chemical plant main productions. The
company believed the demand for styrene will rise significantly as the chemical plant can fully
operate on 2021 due to the following reasons.

The most common method to produce styrene is through catalytic dehydrogenation of

ethylbenzene. Therefore, the company decide for the process. This process required
ethylbenzene as the raw material and catalyst usually iron oxide to enhance the rate of reaction
to change the reactant to product. Steam generation technology is required to prevent coking
from happening, supplies heat for endothermic reaction, shift the equilibrium towards higher
styrene production and minimize the loss to thermal cracking.

Figure 2 – Reaction of Ethyl Benzene to Produce Styrene

In Malaysia, few company could be the prospective supplier for the raw material needed
for styrene production listed as the following table. The raw material is highly available in
Malaysia market. Benzene and Ethylene can be supply from Titan Petchem (M) Sdn. Bhd in
Pasir Gudang, Johor, while Ethylbenzene from Idemitsu SM (M) Sdn. Bhd. Pasir Gudang,
Johor. The total of production and operation costs estimated to amounted about RM15.65
million. The company estimated a payback period within 5 years, which then deduce that the
annual payback needed to satisfy this period is approximately RM 3.13 million.

For marketability, (Styrene: 2018 World Market Outlook and Forecast up to 2027,
2018) revealed a unique data for the global market Asia Pacific holds the largest demand for
the styrene based on this forecast. (Ong, 2018) stated that styrene demand across Asia are stable
with buyers mostly buy a need-to-basis, lobbying for prices at under RM6183.64/tonne. Table
2 shows a few countries involved in Malaysia exportation for polymers of styrene in primary

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forms according to the United Nations COMTRADE database on international trade. Thus,
these data from Malaysia of Polymers of Styrene in Primary Forms show that the demand for
styrene in Asia is gradually increase and expected to rise and a good investment to generate
favorable revenue.

Table 2: Malaysia Export Polymers of Styrene in Primary Forms

Country International Trade*

China (Economics, China Imports From Malaysia of Polymers RM 694.41 million

of Styrene In Primary Forms, 2016)

United States (Economics, United States Imports From RM 14.06 million

Malaysia of Polymers of Styrene in Primary Forms, 2016)

Japan (Economics, Japan Imports From Malaysia of Polymers RM 64.70 million

of Styrene in Primary Forms, 2017)

India (Economics, India Imports From Malaysia of Polymers RM 74.38 million

of Styrene in Primary Forms, 2017)

Germany (Economics, Germany Imports From Malaysia of RM 5.98 million

Polymers of Styrene in Primary Forms, 2017)

iii. Biodiesel Production

The final product opportunity identified was a biodiesel production. Production of

biodiesel is a process which including methanol and vegetable oils as raw materials. Biodiesel
can be used with some precautions in diesel engines in many sectors including on-road
vehicles, off-road mobile equipment and vehicles and stationary equipment. In this company,
the waste vegetable oils were used to produce biodiesel with methanol. The by-product of the
production of biodiesel is glycerol that used in cosmetic product. The raw materials are
available in Gebeng. Pahang, where various suppliers of biofuel-related chemicals are close by
such as methanol in Dovechem Chemical Industries (Kuantan) Sdn. Bhd. and BASF Petronas
Chemicals Sdn. Bhd. Gebeng is a rural area so that there were many restaurants where they can
supply for waste vegetable oil to the company. The Gebeng Industrial Estate has near to some
cosmetic industries such as Uniweld Industrial Supply Sdn. Bhd. to supply the glycerol, which
being profit in cost production. For marketability, the many environmental benefits and

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applications of biodiesel will continue to ensure that a substantial market exists for this
attractive alternative to conventional petroleum diesel fuel.

The alkali-catalyzed process used in the production of biodiesel. The production starts
by heating and pressurizing the raw materials that are methanol and waste vegetable oil for
latter process. Methanol is brought to a temperature of 211 oC while waste vegetable oil to
293.9oC by using heat exchangers before being pumped to a mixer. The mixture then passed
through the heat exchanger to a temperature of 350 oC and flowed to the reactor. The plug flow
reactor is for the biodiesel production. Therefore, the production was slightly difficult to handle
because of their operating condition of equipment and the methanol, which is typical of
hazardous chemical.

The production and operation costs is randomly estimated about RM 14.55 million, the
company estimated a payback period within 5 years, which then deduce that the annual payback
needed to satisfy this period is approximately RM2.91 million.

Based on the table 3, the weighted factor scoring method is used to rank these projects
and determine project should our company pursues. To decide the best product for new process
industry, we have considered few aspects such as production process, raw materials
availability, marketability, low cost of production, payback period and the application. We
have outline three productions for our new chemical plant product which are methanol, styrene
and biodiesel. The highest total weighed score is the production of methanol. After full
consideration and comparison between each production, we have decided to choose Methanol
Production for our new chemical plant. We have provided reasons and justification for our
choice as stated.

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 Table 3 – Weighted factor scoring method for each production

Selection Weighting Methanol Production Styrene Production Biodiesel Production

Criteria
Score Weighted Score Weighted Score Weighted
Score Score Score

Production 20 5 100 4 80 4 80
Process

Raw Materials 20 4 80 5 100 5 100

Availability

Marketability 15 5 75 5 75 4 60

Low Cost of 20 4 80 3 60 3 60
Production

Payback Period 15 5 75 3 45 4 60

Application 10 4 40 5 50 4 40

Total Weighed 100 450 410 400

Score

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1.3 INTRODUCTION TO LOCATION

Based on the market survey and preliminary feasibility study, there are few places have been
considered for the site selection. Three sites within Peninsular Malaysia were selected for
further consideration: Pasir Gudang, Kerteh and Butterworth. The location chosen is Kerteh,
Terengganu for the existing infrastructure, proximity to road, rail and sea transport and thus
minimizing the overall transportation costs. Government assistance is anticipated to encourage
the development of the state. The plant layout is design based on specified safety
considerations, costs and ease of access and flexibility.

Table 4 – Characterization of The Site Suggestion

Site Suggestion

No Selection Criteria Kerteh, Pasir Gudang, Butterworth,

Terengganu Johor
Penang

1 Raw materials availability 5 4 3

2 Markets 4 3 3

3 Energy Availability 4 4 4

4 Climate Conditions 3 3 3

5 Transportation facilities 5 4 3

6 Water Supply 3 3 -

7 Waste Disposal 5 5 5

8 Labour Supply 3 3 3

9 Flood and Fire protection 3 3 3

10 Community factors 4 4 4

Total 39 36 31

1 = Very Bad , 2 = Bad , 3 = Moderate , 4 = Good , 5 = Very Good

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1. Raw Material Availability
The source of raw material is one of the most important factors in selection of a plant site. If
large volume of raw material is consumed, it is the best to choose the place for the plant site
near the raw materials sources. This is because it will reduce the transportation cost and storage
sites facilities. Based on the research and information gathering, below are the company that
provide the raw material for production of methanol: -

Table 5 – Company That Supply Raw Material for Production of Methanol

Raw Company
Material
Carbon Linde Gas Products Malaysia Sdn. Bhd.
dioxide Lot Q, Plot 1, Kertih Biopolymer Park, Phase 2, 24300 Kerteh, Terengganu.

All Gases Sdn. Bhd.

3789, Kawasan Industri Miel, Kampung Teluk Kalong, 24007 Chukai, Terengganu.
Hydrogen Linde Gas Products Malaysia Sdn. Bhd.
Address: Lot Q, Plot 1, Kertih Biopolymer Park, Phase 2, 24300 Kerteh, Terengganu.

2. Market
Malaysia's methanol demand was mainly driven by the formaldehyde sector. MTBE and acetic
acid were the two other major methanol end-use markets. Methanol have a large number of
chemically complex materials such as plastics. Kerteh, Terengganu was chosen as the best for
marketing factor. There are few companies that highly demand for methanol. For instance,
Petronas Chemicals MTBE Sdn. Bhd.

3. Energy Availability
All the state has equivalent price for electricity. It is due to standard price provided by the
Tenaga National Berhad (TNB) for the industrial sector. However, for the company that
generate their own electricity by using turbine concepts or other means of generation electricity
allowing the reducing of the utilities cost.

4. Climate Conditions
Adverse climatic conditions at a site will increase costs. Abnormally low temperatures will
require the provision of additional insulation and special heating for equipment and pipe runs.
Stronger structures will be needed at locations subject to high winds or earthquakes.

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5. Transportation Facilities
Transportation is another factor that must be considered for site selection because with
transportation is the way for connection. The plant should have better transportation facilities
to ease the transportation of the product to the customer and for the utilities. Based on the table,
we decided to choose Pasir Gudang as the 1 st place for transportation facilities, it is because
Pasir Gudang have three main terminal ports compared to Kerteh which only have two and
Butterworth only have one. Thus, Pasir Gudang provide a greater choice for transportation and
thus allowing to reduce the cost for the transportation.

Table 6 – Transportation Facilities for The Particular State

State Transportation Facilities
Pasir Gudang, Johor ✓ Tanjung Langsat Port
✓ Tanjung Pelepas Port
✓ Johor Port
Kerteh, Terengganu ✓ Kertih Port
✓ Kuantan Port
Butterworth, P. Pinang ✓ North Butterworth Container Terminal (NBCT)

6. Water Supply
Based on the data from the table below, the minimum charge for water supply in Johor is lower
compared to Terengganu. However, the rate per cubic metre for large consumption,
Terengganu offers lower price for the water supply. Therefore, Kerteh, Terengganu is the best
option since the price of the water is the lowest among the other states.

Table 7 – Price for The Particular State

State Price
Johor (SAJ) Band 1: 0 – 35m3 @ RM 2.80/m3
Band 2: > 35 m3 @ RM 3.30/m3
Min. Charge: RM 30.00
Terengganu (SATU) Band 1: RM 1.15/m3
Min. Charge: RM 50.00
Pulau Pinang (PBA) Not available

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7. Waste Disposal

All industrial processes produce waste products, and full consideration must be given to the
difficulties and cost of their disposal. The disposal of toxic and harmful effluents will be
covered by local regulations, and the appropriate authorities must be consulted during the initial
site survey to determine he standards that must be met. An environmental impact assessment
should be made for each new project or major modification or addition or an existing process.

8. Labour Supply

Labour will be needed for construction of the plant and its operation. Skilled construction
workers will usually be brought in from outside the site area, but there should be an adequate
pool of unskilled labour availability locally and labour suitable for training to operate the plant.
Skilled tradesmen will be needed for plant maintenance. Local trade union customs and
restrictive practices will have to be considered when assessing the availability and suitability
of the local labour for recruitment and training.

9. Flood and Fire Protection

The location should be located nearer the port location. However, the protection such as flood
protection should be considered. The plant must build at the place that has low chances to be
flooding. It can be measure by studies the topography of the site location. For the fire
protection, the plant should have many protections for the fire such as fire extinguisher, etc.
The location of the fire extinguisher must be easy for the people to see. It is because the fire
extinguisher can be used easily whenever getting emergency.

10. Community Factors

The proposed plant must be fit in with and be acceptable to the local community. Full
consideration must be given to the safe location of the plant so that it does not impose a
significant additional risk to the community. On a new site, the local community must be able
to provide adequate facilities for the plant personnel.

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2.0 MARKET ANALYSIS AND MARKET STRATEGIES
2.1 INTRODUCTION TO FEASIBILITY STUDY OF MARKET, PROCESS
AND TECHNOLOGY

Nowadays, methanol is well-known applications in various end use industries such as plastics,
automotive, paints & adhesives, construction and pharmaceutical. The reason our company
decided to produce Methanol because there are increasing in demand of the customers and from
other companies. One of them includes production of polymers such as polyesters, which uses
methanol as its original raw material.

A variety of plastics produced based on the reactions from the methanol with phenol, a
white crystalline solid that is easily evaporated at a normal temperature. This reaction is also
can be combined with Urea and Melamine where the Melamine is a white crystalline compound
made by heating Cyanamide and used in making plastics. Besides the plastics, methanol is used
to make Methanal. Methanal is a naturally occurring organic compound with a chemical
formula of CH2O. It also known as formaldehyde, Methyl Aldehyde and Methylene Oxide.

The methanol also used as a fuel due to its exceptional blending properties and high-
octane rating. Gasoline blended with methanol provides enhanced engine performance and
better fuel efficiency. Due to these reasons, demand for methanol is continuous in the future.
Therefore, our company wants to produce Methanol from Carbon dioxide and Hydrogen (CO 2
& H2) that derived we bought from nearby industry. We chose to buy raw materials instead of
producing on our own so it will be more cost saving and there will be lesser maintenance of
equipment.

2.2 TARGET MARKET ANALYSIS

We target the manufactures of end-use industry, the raw material suppliers, the aftermarket
suppliers, the research Institute or education Institute and the potential investors as our
customers who are in plastics, automotive, paints & adhesives, construction and
pharmaceutical industry in Malaysia.

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2.3 LOCATION ANALYSIS

Our company decided to produce methanol due to the fact that there are not much company in
Malaysia that produces methanol. We choose in Kerteh, Terengganu as our location to produce
methanol. It is because the largest production of Methanol is in Labuan, which is far away from
the Peninsular Malaysia. Considering the fact that Malaysia is lacking production of Methanol
in Peninsular Malaysia, we have come upon the idea of producing Methanol whereby
Peninsular Malaysia as our target market, which includes regions that is currently developing
such as Terengganu, Pahang, Kuala Lumpur and Johor.

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3.0 PROCESS ANALYSIS

3.1 PROCESS SELECTION

First of all, there are two methods in production of methanol which are from natural gas or
carbon dioxide together with hydrogen (syngas) as raw materials. Malaysia Methanol Chemical
Technology (M) Sdn Bhd chose to produce methanol from carbon dioxide and hydrogen as it
basically environmental friendly in helping to reduce carbon footprint besides carbon dioxide
can be found abundantly. It is easy to handle these gasses, as it is unlikely to be dangerous as
it can be easily captured through carbon capture, neither from the air nor from agricultural
sources. For hydrogen gas, it can also be obtained through renewable energy sources, biomass,
natural gas and so on. If we choose to produce Methanol through natural gas, it would be
difficult as it requires processing methanol synthesis compared to using syngas as raw materials
that can produce Methanol directly.

Despite the easily method of capturing both carbon dioxide and hydrogen, we chose
our main resources of obtaining the following syngas through buying the gasses from industry
nearby for cost saving purpose. If we chose to produce our own carbon dioxide gas and
hydrogen gas, we will have to invest more on equipment besides the maintenance of the
equipment. Considering the factor of the investment if we produce our own syngas, we chose
to buy from the nearby industry.

Generally, it considering the factor of safety throughout the process of production of

methanol, observation is required especially on summer days as methanol is flammable and
our company stores large amount of Methanol before transporting our production for
manufacturing purposes. For that, cooling gas is required to avoid explosion. For proper
handling methanol, our company take proper safety measures by ensuring proper storage and
transportation in order to keep the well-being of workers and individual. For that, in handling
Methanol, proper attire and protective goggles are needed to avoid eye irritant and to avoid
methanol from being absorbed into skin.

According to the chart of Malaysia’s annually petrochemical feedstock in Malaysia for

a plant, production of methanol is by 660,000 million tonnes per year in Labuan. This shows
that Methanol highly demand in Malaysia. Besides, in worldwide production of methanol is
also high. According to Methanol Market Service Asia (2014), the annual production of
methanol are as follows:

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Table 8 – Data of methanol market service in 2014

Region Market Service

World 65 million tonnes
Europe 2.6 million tonnes
US 2.8 million tonnes
Middle East 14 million tonnes
SE Asia 4.8 million tonnes
China 35 million tonnes
South America 10 million tonnes

As refer to the table above, we chose to produce Methanol as it never fails to be in high
demand for local market and worldwide. Methanol is highly marketable as many countries are
starting to use Methanol as a transportation fuel because of its efficiency to combust and low
cost compared to other fuel. Methanol applications also includes as aerosol, door insulation,
manufacture of dyes and plastics.

3.2 PROCESS BACKGROUND

There are two methods used in this synthesis process, which are direct method and two-step
method.

Direct method: CO2 + 3H2 → CH3OH + H2O

Two step method: CO2 + 2H2 → CO + H2O

CO + 2H2 → CH3OH

For our company, we chose two step method because we can obtain methanol directly
without containing any water. This production of methanol can be increased by the presence
of catalyst which is copper or zinc oxide. Process conditions with temperature of 210°C –
270°C and pressure 50-100 bar. For CO2, the gas enters at temperature of 25°C and pressure
which of one bar while hydrogen gas enters at 25°C and 1 bar. Then the following gasses are
compressed at 78 bar. This process starts when the carbon dioxide and hydrogen enter the
stream to reverse water gas shift (RWGS) reactor. At the RWGS reactor, carbon dioxide gas
(CO2) is converted into carbon monoxide gas (CO) then carbon monoxide (CO) and water are

16
separated at the distillation column. The water will be coming out from the bottom of column
and carbon monoxide (CO) will be coming out at the top of the column which then enter the
compressor and react with hydrogen gas before entering the reactor. In the end of the process,
the product exit at the bottom of the reactor then enter separator, which comes out at the outlet
stream.

3.3 EQUIPMENT

1. Reverse Water Gas Shift (RWGS) Reactor

Hydrogen gas, carbon monoxide gas and steam fed into the RWGS reactor. In this reactor, we
also use closed loop control, which transmits signal for the level, and temperature control to
ensure the methanol produced does not overflow and the temperature set is follow accordingly.

2. Compressor

In here, we install manual valve before and after entering the compressor as a bypass loop in
case the auto valve malfunction for the compressor to operate. We use pressure control in order
to ensure the syngas enters follow the pressure set accordingly. There are two pressure
controller which determines if the compressor is operate normally or not. If the compressor
does not operate accordingly, we can see that the valve on the both side of the pressure
controller is indifferent. For that, manual valve will be use to ensure the pressure enters is
suitable for the compressor to operate. The compressor is connected to pump which then pumps
out the methanol upwards into the cooler.

3. Cooler

In the closed loop control, we control the flow automatically based on the flow set for the
stream. In here, methanol is cooled to avoid explosion due to its properties that is flammable.
Temperature is control at the end of the cooler to avoid from low temperature of methanol to
be produced. The methanol produced is then send to the condenser if the temperature is at
normal rate.

4. Methanol Reactor

In here, it involves flow controller where the transmitter will ensure that the flow is enter the
reactor correctly. Cooling water is added into the pump for the water to enter the methanol
reactor. Excess water is then being purge.

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5. Condenser

In here, pressure is increased to meet the requirement for the methanol and water to be fed into
the compressor to operate normally.

6. Distillation Column (T-100)

In here, cooling water is supply for the operation of the distillation column. Level and flow of
methanol and water is controlled by the set point in the following distillation column. At the
top, light end products are produced while at the bottom, the methanol and water composition
then enter the next distillation column.

7. Distillation Column (T-200)

The only thing that differs from the previous distillation column is where at the top of the
column, pure methanol is produced while at the bottom of the column, water is produced which
the water is then being recycled back to the condenser for further process of the production of
methanol. excess hydrogen gas is then purge through the vent.

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3.4 TECHNOLOGY

Figure 3 – The Process Flow Diagram of The Production of Methanol

For the production of methanol, there are few major equipment that involves which includes
RWGS reactor, compressor, cooler, condenser, methanol reactor and distillation column. Raw
syngas which consist of carbon monoxide gas and hydrogen gas is fed into the RWGS reactor.
In the RWGS reactor, there are two steps of method involved which from methanol and water.
Methanol and water which is in the form of gas then enter the compressor to increase the
pressure so that the gas will have enough energy to be flow upwards. Cooling gas then is
supplied to the methanol in the cooler to avoid explosion as methanol as it is a flammable
chemical. The methanol is then entering the condenser to be condensed into liquid. The
condensed methanol enters the compressor which increases the pressure. From the methanol
reactor, both methanol and water enters the first distillation column which produces light end
products before separating in the second distillation column to produce pure methanol and
unreacted methanol together with water. Excess water from the first distillation column is
recycled back into the condenser to be reuse again for the production process.

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4.0 COMPANY SET-UP

4.1 COMPANY ORGANIZATION

Figure 4 – Organization chart

As shown in Figure 4, the organization chart for Malaysia Methanol Chemical Technology
(MMCT) Sdn Bhd. Referring to the figure above, the organizational structure of this project
management team is led by a Project Manager and a Project Engineer will be responsible in
assisting the project manager.

4.2 JOB DESCRIPTION

i. Project Manager and Project Engineer

➢ To supervise and provide instructions to project team
➢ Provide weekly Project Status Reports to the Project Sponsor
➢ Appoint weekly meetings
➢ Prepare supporting materials with the Project Sponsor (agenda, presentations, reports)
➢ Meet and deal with potential clients/ customers
➢ Execute project management processes: risk, issues, change, quality, and document
management

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 ➢ Ensure project plan, schedule, and budget is up-to-date and follow the project
plan/outline.

ii. Team Leader

➢ To supervise and provide instructions to sub-team members and sub-coordinates.
➢ Appoint meeting with sub-team members regularly
➢ Provide regular Status Reports to Project Manager
➢ Manage and resolve team-level risks, issues, and changes in the project.

In ensuring this project runs smoothly, several teams have been established based on their
knowledge and expertise. The teams are divided into six which includes the technical team,
construction team, finance team, human resources team, safety team and quality team. Each
team is led by a Team Leader who is responsible in managing their department in the project.

iii. Technical Team

Technical team consists of Process, Mechanical, and Electrical and Instrumentation engineers.
Each team members responsible for performing engineering activities based on their expertise.
1. Process Engineer
➢ To oversee the construction of new plants
➢ Ensuring the design, operation, control, equipment works of the plant as its
specification.
2. Mechanical Engineer
➢ Responsible in designing, building and maintaining tools and components for the
whole plant
3. Electrical and Instrumentation Engineer
➢ Responsible in installing equipment and utilities such as water and electricity supply,
control valve, and pipeline for the whole plant.

iv. Construction Team

1. Civil Engineer
➢ To provide technical advice on plant design
➢ Provide co-ordination and help in supervising construction projects
2. Site technicians
➢ To assist site engineer for maintenance works during the construction
3. Foreman

21
 ➢ In charge in overall constructions
➢ To ensure workers at construction site are following work procedures correctly and
follow safety precautions.

v. Finance Team
1. Head of Finance
➢ Responsible in giving instructions to accountants
➢ Assist project manager and engineer in budgeting
➢ Appoint meeting with sub-members regularly
➢ Update on company’s budget from time to time
2. Accountants
➢ Responsible in accounting and purchasing works
➢ To improving the operational and financial effectiveness of company’s budget
➢ Perform cost and financial analysis for projects and purchasing work
➢ Perform budgeting for overall project

vi. Human Resource Team

1. Human Resources Officer
➢ To maintain and enhance the organization's human resources
➢ Planning, implementing, and evaluating employee relations and human resources
policies, programs, and practices
➢ Conduct orientation and training programs.
➢ In charge in preparing employees for assignments

vii. Safety Team

1. Health, Safety, and Environments (HSE) Engineers
➢ Responsible on the safety and health of the employees especially those involve in the
construction activities and officers
➢ In charge in development and maintenance of health, safety and environmental
systems
2. Health, Safety, and Environments (HSE) Officer
➢ To ensure workplace safety comply with the regulation requirements
➢ To conduct regular site safety inspection and follow up actions

22
 ➢ To ensure project safety is accordingly to Environmental Quality Act 1974 and
Occupational Safety and Health Act 1994.
viii. Quality Team
1. Quality Assurance (QA) Engineer
➢ Responsible in determining which suppliers are qualified in delivering the required
quality
➢ To test supplied materials given out by suppliers
2. Quality Control (QC) Engineer
• Responsible in making sure the selected suppliers meet the qualification criteria
• Ensure the materials meet required quality standards

Table 9 – List of staffs for Administrative and Operational Department

DEPARTMENT SHIFT& TEAM POSITION PAX

Management Project Manager 1
Project Engineer 1
Head of Human Resource 1
Assistant Human Resource 1
Head of Finance 1
Accountant 1
Receptionist 1
Dispatch 1
Information Technology (IT) 2
Technician
Secretary 2
Marketing 2
Logistic 2
Construction Civil/ Site Engineer 1
Site Technician 2
Foreman 1
Quality Control Quality Assurance (QA) Manager 1
Quality Control (QC) Manager 1
3 SHIFTS (4 TEAM) QC Technician 4
Safety HSE Manager 1

23
 HSE Engineer 1
2 SHIFTS (3 TEAM) HSE Technician 2
Technical Process Engineer 2
Mechanical Engineer 2
Electrical and Instrumentation 2
Engineer
Production Manager 1
Assistant Manager 1
Senior Engineer 1
Engineer 1
3 SHIFTS (4 TEAM) Technician 3
Boardman 6
Utility Utilities Manager 1
2 SHIFTS (3 TEAM) Supervisor 2
Technician 3
Warehouse Warehouse Manager 1
2 SHIFTS (3 TEAM) Logistic Coordinator 2
Technician 3
Total No of 63
Staffs

24
 Project Timeline

Team Development
Project Management
Project Charter Scope

Project Plan Schedule

Raw Materials Feasibility Cost

Legal Approval
Raw Materials Feasibility
Location Selection
Assessment (Marketibility)
Environmental

Raw Material Inspection

New Chemical

Packaging/Packing
Product Testing
Inspection
Plant

Final Product Inspection

Installing Major
Equipments
Installing Minor
Equipments
Construction Contractor Selections
Wiring

Piping
Product Delivery
Operation Monitoring
Equipment Maintanance
Data Analysis
Prospective Customer

Sales & Marketing Prospective Supplier

Promotion

Figure 5 - Work Breakdown Structure For New Chemical Plant For Production of Methanol

25
 Production Of Methanol

Detailed
Start-up
Engineering Safety Analysis Contract Purchasing Site Works Installations Testing
Operation
Design

Major
Vendor Quotation Install Major Start-up
Final Drawings Hazop Site Cleaning Equipment
Contract Requisition Units Procedure
Testing

Water
Final Sizing Of Contractor Purchase Install Minor Shut-down
Fmea Drainage Leakage Test
Major Units Selection Order Units Procedure
System

Safety Construct Raw Material Start Up

Final Datasheet
Procedure Building Inspection Process

Packaging/ Operation And

Packing Maintanence
Inspection Manual

Final Product
Inspection

Figure 6 - Work Breakdown Structure For Production of Methanol (Set-Up Flow)

26
Figure 7 - Mind Map For New Chemical Plant For Production of Methanol

27
Figure 8 - Mind Map for Production of Methanol (Set-Up Flow)

28
5.0 PROJECT SCHEDULING

5.1 ACTIVITY / WORK PACKAGE DURATION

Time is the most elements to be controlled in every project to ensure that the project can be
completed within the project durations. The duration for each activity need to be allocated in
order to manage the time. The duration for each work package as shown in table 10:

Table 10 - Duration (month) for each phase

PHASE DURATION (MONTHS)

ORGANIZATION START-UP PHASE 13

PROCUMENT PHASE 12

CONSTRUCTION PHASE 13

COMMISSIONING AND OPERATION PHASE 4

29
5.2 PROJECT SCHEDULE

The details of activities have been listed in the project schedule. Gantt Chart is one of the tools
to monitor the activities of the project. The plan Gantt Chart is the based guideline for the
project while the actual progress need to be monitored in order to keep track if there is any
delay in project. Thus, time management is important to make the project success on time.

Table 11 – The details of activity with duration for each phase

PHASE ACTIVITY DURATION

(MONTH)

ORGANIZATION A- Team Development 3

START-UP B- Project Charter 4
C- Location Selection 6
D- Safety Analysis 1
PROCUREMENT E- Legal Approval 3
F- Contract & Purchasing 8
CONSTRUCTION G- Installing Equipment 5
H- Wiring 3
I- Piping 3
J- Site Work 2
COMMISIONING K- Testing Equipment 1
AND OPERATION L- Start Up-Operation 3

5.3 CRITICAL PATH ANALYSIS

Critical path analysis has been analysed using Critical Path Method (CPM). In order to control
the project, finding the critical path is important. In CPM, the activities that fall on the critical
path represent any task that will delay the whole project if it is performed behind schedule.

A critical activity is the activity that involved in a project which does not have any slack time.
Critical path analysis for this project as shown in table 12.

30
Table 12 - Critical path analysis
ACTIVITY DURATION ES EF LS LF SLACK CRITICAL
(MONTH) TIME TASK
A 3 0 3 0 3 0 Y
B 4 0 4 4 8 4 N
C 6 3 9 3 9 0 Y
D 1 4 5 8 9 5 N
E 3 9 12 9 12 0 Y
F 8 12 20 12 20 0 Y
G 5 20 25 20 25 0 Y
H 3 20 23 24 27 2 N
I 3 20 23 24 27 2 N
J 2 25 27 27 29 2 N
K 1 25 26 25 26 0 Y
L 3 26 29 26 29 0 Y

Earliest Start Time (ES): This is the earliest time an activity can be started, allowing for the
fact that all proceeding activities have been completed.

Earliest Finish Time (EF): This is the earliest time an activity can be finished or completed.

Latest Start Time (LS): This is the latest time an activity can be started without delaying the
start of following activities which would put the entire project behind the schedule.

Latest Finish Time (LF): This is the latest time for an activity can finish in order to remain
on project schedule.

Activity Slack Time (Slack): The amount of slippage in activity start or duration time which
can be tolerated without delaying the whole project.

31
AOA Network

Figure 9 Activity on Arrow (AOA) Network

AON Network

Critical Path

Figure 10 Activity on Node (AON) Network

32
The network of critical path analysis is shown in Figure where orange line indicates the
critical activities.

Table 13 - Network path with duration (month)

NO PATH DURATION (Months)

1 A-C-E-F-G-K-L 29
2 A-C-E-F-G-J 27
3 A-C-E-F-H-J 25
4 A-C-E-F-I-J 25
5 B-D-E-F-G-K-L 25
6 B-D-E-F-G-J 23
7 B-D-E-F-H-J 22
8 B-D-E-F-I-J 22

Based on the above figure and table, critical path has been identified as follows:

A→C→E→F→G→K→

33
 2018 2019 2020
ACTIVITY
JAN FEB MAC APR MAY JUN JUL AUG SEP O CT NO V DEC JAN FEB MAC APR MAY JUN JUL AUG SEP O CT NO V DEC JAN FEB MAC APR MAY
A

Figure 11 – Gantt Chart

34
 6.0 BUDGETTING

Table 14Total Salary for Administrative and Operational Department

DEPARTMENT POSITION PAX SALARY PER TOTAL (RM)

PAX (RM)
Management Project Manager 1 8700 8700
Project Engineer 1 3900 3900
Head of Human 1 7000 7000
Resource
Assistant Human 1 2200 2200
Resource
Head of Finance 1 8300 8300
Accountant 1 3000 3000
Receptionist 1 1800 1800
Dispatch 1 1800 1800
Information 2 2000 4000
Technology
(IT) Technician
Secretary 2 2700 5400
Marketing 2 2500 5000
Logistic 2 2300 4600
Construction Civil/ Site Engineer 1 3400 3400
Site Technician 2 2400 4800
Foreman 1 3200 3200
Quality Control Quality Assurance (QA) 1 7300 7300
Manager
Quality Control (QC) 1 7300 7300
Manager
QC Technician 2 3000 6000
Safety HSE Manager 1 8000 8000
HSE Engineer 1 2300 2300
HSE Technician 2 1800 3600
Technical Process Engineer 2 4000 8000

35
 Mechanical Engineer 2 3400 6800
Electrical and 2 3600 7200
Instrumentation
Engineer
Production Manager 1 7400 7400
Assistant Manager 1 5200 5200
Senior Engineer 1 7000 7000
Engineer 1 2500 2500
Technician 3 1800 5400
Boardman 6 1800 10,800
Utility Utilities Manager 1 3500 3500
Supervisor 2 2900 5800
Technician 3 1800 5400
Warehouse Warehouse Manager 1 7200 7200
Logistic Coordinator 2 2500 5000
Technician 3 1800 5400
TOTAL RM 194,200
TOTAL PER ANNUM RM 2,330,400

IMPORTANT NOTES:

Salaries for administrative and operational department are based on salary estimation in
Malaysia by https://www.payscale.com/research/MY/ and https://www.jobstreet.com.my/.
Employee’s experience, and skills are taken into consideration in determining their salaries.

Table 15 – Cost of major equipment

EQUIPMENT UNIT PRICE (RM)

RWGS Reactor 1 150,000
Methanol Reactor 1 2,000,000
Compressor 2 200,000
Cooler 1 500,000
Condenser 2 800,000
Distillation Column 1 5,000,000

36
 Storage Tank 1 250,000
TOTAL 8,900,000
IMPORTANT NOTES:
Price for cost of major equipment are based on the price on https://www.alibaba.com/

Table 16 – Expenditure Cost

TYPE NOTES TOTAL COST
(RM)
Raw Materials RM 500/Tonne
• Hydrogen RM 60/Tonne
• Carbon
Dioxide
Land RM 12/sqft RM 32,408,628
Plant size: 62 acres (2700719 sqft)
Construction 20% from total equipment price RM 1,780,000
Plant Building Estimation RM 5,000,000
Capital Cost Includes price of land purchasing, major equipment, RM 48,088,628
construction price and building price
Transportation 3% from capital RM 1,442,658
Utilities 3% from capital RM 1,442,658
Labors Includes those involve in installing equipment and RM 200,000
building plants
100 workers (RM 2000/person)
Maintenance Twice per year RM 10,000
License Per Annum RM 4,000
Insurance For company’s entire existence RM 10,000,000
TOTAL RM 100,377,132

37
Table 17 – Office Equipment Cost

TYPE UNIT PRICE/ UNIT PRICE (RM)

Desks and Office Chairs 6 Sets Each RM 187.70 RM 2,252.4
PC Computer 2 RM 2,000 RM 4,000
Laptop 6 RM 1,200 RM 7,200
Printer 2 RM 250 RM 500
Fax Machine 1 RM 300 RM 300
TOTAL RM 14,252.4

IMPORTANT NOTES:

Price of office equipment are based on market price in Malaysia as referred to

https://www.ikea.com/my/en/ and http://www.techhypermart.com/notebooks.html

COST ESTIMATION

Overall Cost
The overall cost consists of employee’s salaries (per annum), major equipment cost (one time
payment), expenditure cost (per annum and throughout company’s existence) and office
equipment cost (one time payment).

𝑂𝑣𝑒𝑟𝑎𝑙𝑙 𝐶𝑜𝑠𝑡 = 𝐸𝑚𝑝𝑙𝑜𝑦𝑒𝑒’𝑠 𝑆𝑎𝑙𝑎𝑟𝑖𝑒𝑠 + 𝑀𝑎𝑗𝑜𝑟 𝐸𝑞𝑢𝑖𝑝𝑚𝑒𝑛𝑡 𝐶𝑜𝑠𝑡

+ 𝐸𝑥𝑝𝑒𝑛𝑑𝑖𝑡𝑢𝑟𝑒 𝐶𝑜𝑠𝑡 + 𝑂𝑓𝑓𝑖𝑐𝑒 𝐸𝑞𝑢𝑖𝑝𝑚𝑒𝑛𝑡 𝐶𝑜𝑠𝑡

= 𝑅𝑀 2,330,400 + 𝑅𝑀 8,900,000 + 𝑅𝑀 100,377,132 + 𝑅𝑀 14,252.4

= 𝑹𝑴 𝟏𝟏𝟏, 𝟔𝟐𝟏, 𝟕𝟖𝟒

Capital Cost
The capital cost includes land of purchasing, major equipment, construction price and building
cost. Total estimation is made in determining the cost.

𝐶𝑎𝑝𝑖𝑡𝑎𝑙 𝐶𝑜𝑠𝑡 = 𝐿𝑎𝑛𝑑 + 𝑀𝑎𝑗𝑜𝑟 𝐸𝑞𝑢𝑖𝑝𝑚𝑒𝑛𝑡 + 𝐶𝑜𝑛𝑠𝑡𝑟𝑢𝑐𝑡𝑖𝑜𝑛 + 𝐵𝑢𝑖𝑙𝑑𝑖𝑛𝑔

= 𝑅𝑀 32,408,628 + 𝑅𝑀 8,900,000 + 𝑅𝑀 1,7800,000 + 𝑅𝑀 5,000,000

= 𝑹𝑴 𝟒𝟖, 𝟎𝟖𝟖, 𝟔𝟐𝟖

38
Operation Cost
Total operation cost is based on raw materials cost, employee’s salaries, transportation,
utilities, maintenance, license and insurance.

𝑂𝑝𝑒𝑟𝑎𝑡𝑖𝑜𝑛 𝐶𝑜𝑠𝑡
= 𝐸𝑚𝑝𝑙𝑜𝑦𝑒𝑒 ′ 𝑠 𝑆𝑎𝑙𝑎𝑟𝑖𝑒𝑠 + 𝑀𝑎𝑖𝑛𝑡𝑒𝑛𝑎𝑛𝑐𝑒 + 𝐿𝑖𝑐𝑒𝑛𝑠𝑒 + 𝐼𝑛𝑠𝑢𝑟𝑎𝑛𝑐𝑒
+ 𝐿𝑎𝑏𝑜𝑟𝑠

= 𝑅𝑀 2,330,400 + 𝑅𝑀 10,000 + 𝑅𝑀 4,000 + 𝑅𝑀 10,000,000

+ 𝑅𝑀 200,000

= 𝑹𝑴 𝟏𝟐, 𝟓𝟒𝟒, 𝟒𝟎𝟎

Production Cost
Consists of cost of raw materials, major equipment, transportation and utilities.

𝑃𝑟𝑜𝑑𝑢𝑐𝑡𝑖𝑜𝑛 𝐶𝑜𝑠𝑡 = 𝑅𝑎𝑤 𝑀𝑎𝑡𝑒𝑟𝑖𝑎𝑙𝑠 + 𝑀𝑎𝑗𝑜𝑟 𝐸𝑞𝑢𝑖𝑝𝑚𝑒𝑛𝑡 + 𝑇𝑟𝑎𝑛𝑠𝑝𝑜𝑟𝑡𝑎𝑡𝑖𝑜𝑛 + 𝑈𝑡𝑖𝑙𝑖𝑡𝑖𝑒𝑠

= 𝑅𝑀 560 + 𝑅𝑀 8,900,000 + 𝑅𝑀 1,442,658 + 𝑅𝑀 1,442,658

= 𝑹𝑴 𝟏𝟏, 𝟕𝟖𝟓, 𝟖𝟕

Net Profit Value

The company initial investment is RM 111 621 784 and a required rate of return of 12%. The
maintenance will cost RM10 000 for every year. The company estimated that 30% from the
initial investment as cash inflow for the first year and 20% increment for every year.

Year Inflow Outflow NetFlow Discount rate Net Profit Value

0 - 111 621 784 -111 621 784.00 1 -111 621 784.00
1 33 486 535.20 10 000 33 476 535.20 0.8696 29 111 195.01
2 40 183 842.24 10 000 40 173 842.24 0.7561 30 375 442.12
3 48 220 610.69 10 000 48 210 610.69 0.6575 31 698 476.53
4 57 864 732.83 10 000 57 854 732.83 0.5718 33 081 336.23
5 69 437 679.39 10 000 69 427 679.39 0.4972 34 519 442.19
Total 47 164 108.08

39
7.0 PROJECT TERMINATION

Project termination is the final stage in managing the project. The new chemical plant for
production of methanol is expected to finish constructed and can fully operated in a 2 years
and 5 months times and falls under the termination by addition category. This project is an
external but full – fledged addition to the company organization. The project can be terminated
successfully after the following factors is satisfied. Table 1 shows the project close – out
checklist for the project.

1) The objectives of the project are achieved to the full satisfaction of the users.

2) All closeout activities have been completed.

3) All designated interests officially accept the project result and accept the close out.

PROJECT CLOSE-OUT

Organization Financial Purchasing Site

Close Out Compliance Close Down

Charge Audits
Meeting Documents Facilities

Equipment
Reassignment Collect Supplier
Material
Plan Receivables Notifications
Disposal

Personal Reposts Final Report Final Payments

Figure 12 - Requirements in Order to Terminate A Project

Close Out Major Items

Work
Contract. Financial. Personnel. Records.
authorization

40
Steps in Terminating the Project

1) All outstanding contracts to be finalized.

2) Any responsibilities are transfer if necessary.

3) All project team is to be reassign to other duties, or back to their respective duties before
the project started.

4) All remaining resources is to be released.

5) The final accounting on the project is to be completed.

6) The results of the project are to be documented. A close – out report will the final report.

a) Project Performances.

b) Administrative Performances.

c) Organizational Structure.

d) Project teamwork.

e) Project management techniques.

7) The project is to be presented for approval/rejection by the client according to the

Project Agreement.

8) Installation and field testing are applicable.

9) Thanks all the members in the project team for their effort since they all worked hard
to finish up the project.

41
Table 18 - Project Close Out Checklist (Archilbald, 1992)

ITEM REQUIRED
REQUIRED ASSIGNED NOTES
TASK DESCRIPTION PR.
DATE RESPONSIBILITY REFERENCES
NO. YES NO

A PROJECT OFFICE (PO) AND PROJECT TEAM

(PT) ORGANIZATION.

1 Conduct Conduct project close-out meeting

2 Establish PO and PT release and reassignment plan

3 Carry out necessary personnel actions

4 Prepare personal performance evaluation on each PO

and PT member

B INSTRUCTIONS AND PROCEDURES.

1 Termination of PO and PT.

2 Close-out of all work orders and contracts

3 Termination of reporting procedures

42
4 Preparation of final report(s)

5 Completion and dismission of project file

C FINANCIAL

1 Close out financial documents and records

2 Audit final charges and costs

3 Prepare final project financial report

4 Collect receivables

D PROJECT DEFINITION

1 Document final approved project scope

2 Prepare final project breakdown structure and enter into

project file

E PLANS, BUDGETS AND SCHEDULES

1 Document actual delivery dates of all contractual

deliverable end items

43
2 Document actual completion dates of all other
contractual obligations

3 Prepare final project and task status reports

F WORK AUTHORIZATION AND CONTROL

1 Close out all work orders and contracts

G PROJECT EVALUATION AND CONTROL

1 Assure completion of all action assignments

2 Prepare final evaluation report (s)

3 Conduct final review meeting

4 Terminate financial, manpower, and progress reporting

procedures

H MANAGEMENT AND CUSTOMER

REPORTING

1 Submit final report to customer

44
2 Submit final report to management

I MARKETING AND CONTRACT

ADMINISTRATION

1 Compile all final contract documents with revisions,

waivers and related correspondence.

2 Verify and document compliance with all contractual

terms

3 Compile required proof of shipment and customer

acceptance documents

4 Officially notify customer of contract completion.

5 Initiate and pursue any claims against customer

6 Prepare and conduct defense against claims by

customer

7 Initiate public relations announcement re contract

completion

45
8 Prepare final contract status report.

J EXTENSIONS-NEW BUSINESS

1 Document possibilities for project or contract

extensions, or other related new business.

2 Obtain commitment for extension.

K PROJECT RECORDS CONTROL

1 Complete project file and transmit to designated

manager

2 Dispose of other project records as required by

established procedures.

L PURCHASING AND SUBCONTRACTING

1 Document compliance and completion

2 Verify final payment and proper accounting to project

3 Notify vendor/contractor of final completion

46
M ENGINEERING DOCUMENTATION

1 Compile and store all engineering documentation

2 Prepare final technical report.

N SITE OPERATIONS

1 Close down site operations

2 Dispose of equipment and material.

47
8.0 CONCLUSION

The company decided to construct new chemical plant with methanol as the main production since
methanol is currently high in demand and the demand is expected to increase by the year 2020 due
to its vast applications. The chemical plant is expected finish constructed and can be fully operated
in 2 years 5 months times. The process selected is two step method as methanol can be obtained
with minimum by – product. The location chosen is Kerteh, Terengganu which holds the highest
value through weighted scoring method since the location mostly satisfies the new chemical plant
needs and requirements. The total estimation capital needed for the project is expected to amount
of RM 111,621,784. The project is expected to satisfy the company requirement with the objectives
successfully achieved before the termination of the project will be done. The termination falls
under addition category and will be inspected by a team of termination project team.

48