ID Title Authors Year

EST-2751 Estimate Quality: Observations from Shoshanna Fraizinger, CCP 2018

Independent Reviews of Owner's Estimates

EST-2801 (Presentation Only) Understanding Estimate Larry R. Dysert, CCP CEP DRMP 2018
Accuracy FAACE Hon.Life

EST-2825 Introduction to the Organizational Cost Terry Josserand; Edwin P. 2018

Community Framework Chamberlin; Leone Z. Young

EST-2827 Allocating Probabilistic Contingency Gustavo Vinueza C. 2018

EST-2832 Transmission Project Estimate Assessment Yan Wang 2018

EST-2833 Maturity Assessment for Engineering H. Lance Stephenson, CCP 2018
Deliverables FAACE; Peter R. Bredehoeft, Jr.
CEP FAACE

EST-2875 CAPEX Growth Over Project Delay - A Case Dorothy A. Ekeng 2018
Study

EST-2877 Credible Estimates Require Probabilistic John R. Schuyler, PE CCP 2018

Models DRMP

EST-2880 The Development of an Estimating David Kyle, CEP 2018

Department – Strategic Approaches
EST-2881 Benchmarking and Predictive Analytics to Susan W. Bomba, PE; Lamis El 2018
Improve Estimates, Forecasts, and Didi
Performance Measurement

EST-2884 Three Models for Estimating Bid Markups Mohammadjavad Arabpour; 2018
Dr. Osama El Sayed Moselhi,
P.Eng.

EST-2892 Pre-Class 5 Estimating Cost Communication Lisa M. Taylor; Gregory Brink; 2018
for Long-Term System Planning Paul Galeno; Douglas W. Leo,
CCP CEP FAACE Hon.Life
EST-2901 How to Achieve Dramatic Reductions in Arnaldo M. Angelini; Giulio 2018
Megaprojects Costs Sansonetti, CCP

EST-2912 Technology Readiness Levels Guiding Cost Georg Buchner; Johannes 2018
Estimation in the Chemical Industry Wunderlich; Reinhard
Schomaecker

EST-3184 Estimate Validation and Bias Assessment: John K. Hollmann, PE CCP CEP 2019
Ratio-to-Driver Method DRMP FAACE Hon. Life
EST-3201 Predictive Analytics Can Improve Cost Anthony A. DeMarco; Richard 2019
Estimating for Smart City Projects Mabe; Grady Noll

EST-3252 Cost Estimating in Hyperinflation Economies Francis Lira Vargas 2019

EST-3302 (Presentation Only) Overview of New Dave Kyle, CCP CEP 2019
Estimating Recommended Practices

EST-3341 (Presentation Only) Overview - The Estimate Michael French, PE; Dave Kyle, 2020
Basis CCP CEP

EST-3342 (Presentation Only) Overview - Planning the Michael W. Smith, II; Dave 2020
Development of the Estimate Kyle, CCP CEP
EST-3345 (Presentation Only) Estimating Overview Dave Kyle, CCP CEP 2020

EST-3360 An Overview of Deterministic Estimating Kimberly Kozak 2020

EST-3391 Risk Analysis Approach to Contingency From Christopher L. Kinney 2020

the Perspective of an Owner Estimator

EST-3403 (Presentation Only) Function Points: One Daniel B. French 2020

Size Fits All

EST-3404 (Presentation Only) From Point A to Point Daniel B. French; Carol 2020
Estimate: How Requirements Become Dekkers
Function Points
EST-3412 (Presentation Only) Using Cost Enginering to Anthony M. Bazzini 2020
Quantify and Identify Project Risks

EST-3419 Estimating As It Pertains to Risk Shoshanna Fraizinger, CCP 2020

Management

EST-3423 Early Conceptual Estimating Methodologies Larry R. Dysert, CCP CEP DRMP 2020
FAACE Hon. Life; Bruce G.
Elliott, CCP FAACE
EST-3424 Supporting Estimates with Effective Scope of Larry R. Dysert, CCP CEP DRMP 2020
Work Definition FAACE Hon. Life; Todd W.
Pickett, CCP FAACE

EST-3454 Base Estimate, Estimate Accuracy, and Kelly Newman, PE CEP 2020
Contingency

EST-3480 (Presentation Only) Cost Estimate John K. Hollmann, PE CCP CEP 2020
Classification Overview DRMP FAACE Hon. Life

EST-3490 Cost Savings Possible from Converting John B. Smith; Dr. Robert C. 2020
California Offshore Platform Jackets to Byrd PE
Artificial Reefs
EST-3542 A Discussion of the Cost Estimate Dan Melamed, CCP EVP; Bryan 2020
Classification System: As applied in the A. Skokan, PE CCP; Gregory
Engineering, Procurement, Construction and Mah-Hing, PE; Rodney
Operations for the Environmental Lehman; Jake Lefman
Remediation Industries

EST-3559 Overview - Presenting an Estimate to the David Colangelo, CCP 2020

Client

EST-3563 (Presentation Only) Required Skills, Peter R. Bredehoeft, Jr. CEP 2020
Knowledge, Roles, and Responsibilities of a FAACE; Jeffery J. Borowicz, CCP
Project Estimator CEP PSP FAACE
Description
The cost estimating process is used to predict uncertain future costs (which will often become the baseline by which a project is managed)
A key aspect of cost estimating is the minimization of the uncertainty of the estimate given the level and quality of scope definition.
An estimator’s skill, judgement and experience are critical factors affecting the quality of cost estimating artifacts and ability to minimize
uncertainty in the numbers. In addition, the level of detail provided in estimate documentation will define how useful the estimate can be
for further cost engineering activities such as change management, earned value, resource loading, and cost control.

AACE® RP 46R-11 provides recommended competencies for a project cost estimator, however detailed skills, knowledge and methodology
are excluded from this recommended practice document.

Based on the Author’s work reviewing owner’s estimating artifacts, this paper describes:
• Some of the common areas of improvement across the organization’s estimating products,
• Elements an owner’s estimating organization can implement or review to address those areas, and
• Recommendations for maximizing the use of the estimate for other cost engineering activities.

This will be a presentation of the AACE Recommended Practice titled "Understanding Estimate Accuracy" (currently in development but
expected to be completed before the conference). It is intended that the RP will serve as the paper. The presentation will walk through the
identification of an estimate as a range of potential values, discuss the typical shape of the probability distribution associated with the
estimate range, identify the concept of estimate contingency, and identify the elements required to convey information about estimate
accuracy to stakeholders.

Organizations often experience conflicts because of role and responsibility overlaps and gaps. While a potential consequence of
organizational role and responsibility overlap is inefficiency, the consequence of a gap may result in the lack of sustainable and defensible
execution. One specific area of emergent research and assessment, with respect to organizational role and responsibility overlaps and gap
exists within an organization’s ability to generate sustainable and defensible cost estimates. This paper will assist organizations facing the
challenge to improve their cost estimation and analysis capabilities through the general characterization of the four interdependent cost
functions, their processes, and the participants all within the systematic Organizational Cost Community Framework.

Contingency management is necessary in any mid or large project. Calculation of contingency should include concepts such as uncertainty
and scenario thinking, blended into a probabilistic model. This final contingency number responds to a simulated scenario used as a
reference for calculating the potential economic and duration extensions for the project.

From the budgeting side, funding the contingency requires a different number of business units to contribute, each one of them with a
different magnitude. Finding that number, a percentage most of the time, is a task that should be carefully considered as each unit has a
different level of risk exposure through time. Contingency managers have the duty of proposing a somewhat fair solution for the
participant units as the project progresses, deriving a set of different calculations and prorating schemes that sometimes conflict between
each other.

This initial research approaches the contingency allocation problem recognizing the need of disaggregation, model robustness and
creativity in order to generate a set of valid alternatives to be applied to different industries, projects and realities.

In Alberta, transmission project costs are reviewed by the Alberta Electric System Operator (AESO). The AESO validates the preferred
alternative by assessing the reasonableness of the cost estimate.

This paper discusses the main activities in the AESO’s assessment of transmission project estimates:
- Information based analysis
- Quantity based analysis
- Interpretation of the analysis
- Conclusion and recommendations
Over the last 60 years, AACE International has provided numerous recommended practices that have advanced the skills and knowledge o
cost engineering. In an effort to provide further enhancement to the practice of cost engineering, the authors have developed a maturity
assessment tool based on AACE International’s Recommended Practice No. 18R-97, Cost Estimate Classification System - As Applied in
Engineering, Procurement, and Construction for the Process Industries.

The Maturity Assessment for Engineering Deliverables (MAED) tool, as introduced in this paper, is a maturity methodology that further
defines the “Estimate Input Checklist and Maturity Matrix” as provided in the Recommended Practice No. 18R-97 Cost Estimate
Classification System (CECS).

The AACE International RP No. 18R-97 Cost Estimate Classification System, complimented with the Maturity Assessment for Engineering
Deliverables, can be used as a quantitative approach in determining the appropriate level of maturity required for improved estimate
accuracy and confidence, and project delivery success. This article will provide readers with:
• A refined understanding of the maturity for each of the deliverables identified in the Estimate Input Checklist and Maturity Matrix.
• A quantitative assessment for the completeness and usability of the engineering deliverables.

Prolonged project delays could be detrimental to the project’s CAPEX, schedule and economic feasibility, if it does not end up killing the
project. The Case Study is a Midstream EPC Gas Project jointly owned by a National Oil Company and multiple International Oil Companies
The Project has been on the drawing board for over a decade with successive CAPEX estimates prepared during the project’s development
phase. This Paper presents the estimating processes that were adopted by the FEED contractor on behalf of the owner in the preparation
of the CAPEX estimates and the resultant steady CAPEX growth over time. While the major contributing factors to the CAPEX growth are
identified principally as scope changes (internal) and cost escalation (external), there were still many others. Appropriate monitoring and
quantification of these factors are required as the project’s CAPEX evolves over time in order to provide a good basis for informed decision
by management. Keeping the project’s CAPEX growth at a minimum enhances the realization of the project’s business objectives and
profitability.

In estimation and forecasting, a useful reference calculation is a project model solved with best single-point assessment inputs. However,
this deterministic solution (e.g., cost or schedule) seldom provides an objective project estimate. Proper calculations under uncertainty
require Monte Carlo simulation (MCS). In this, subject matter experts assess uncertain input parameters as probability distributions. The
MCS model then produces cost, schedule and other outcome values as distributions.

MCS provides important benefits: 1) Output values are distributions, communicating uncertainty; 2) For the most part, unbiased inputs
produce unbiased model outputs; and 3) The statistical mean outcome value is often substantially different than the reference value.

Stochastic variance (SV) is the correction from the deterministic solution to the mean MCS result. Contributors to SV include nonlinear
equations, correlations, and options. When preparing a variance analysis “reconciling forecast to actual” the important SV term stands
alone. A periodic variance analysis provides a useful report and project control tool.

In a previous paper, the author identified and recommended solutions to specific hindrances in the development of reliable cost estimates
including estimator competency, effective estimating tools, and a lack of reliable historical data. However, the execution of a plan to attain
the desired solutions in the corporate world is fraught with obstacles. Experience by the author with owner and engineering contractor
firms has identified common roadblocks and mitigation strategies to support the attainment of the solutions. This paper will discuss these
mitigation strategies including: developing an identified vision and objectives based on the Total Cost Management Framework, presentin
and winning management approval, development of a detailed plan, presentation to and obtaining support of middle and senior
management, and implementation. Topics will include understanding senior management’s perspective, communicating the correct
information at the appropriate level of detail, setting realistic goals based on business objectives, establishing a sense of urgency, short
term wins, and overcoming the challenges of implementation. These principles can be applied in any development scenario.
By applying predictive analytics to an organization’s historical data, project cost estimates and risk assessments can be more accurate,
improving forecasts and execution on a multi-year investment plan. The challenge with using historical data is that it is often dispersed
throughout various financial and project management software systems, requiring significant data analysis for the comparison to be viable
This paper describes the steps involved in developing a robust cost benchmarking tool that centralizes historical project data into a user-
friendly platform and predicts the cost of a construction project with a high degree of confidence, using only a few input variables. This
paper will detail the four development steps: data gathering, data classification, data analysis, implementation, and refinement. Using the
results from the tool, organizations can negotiate project cost reductions and focus risk management processes to inform contingency
decisions. Across a portfolio, the changes can result in significant savings and form the basis for setting achievable performance targets.

Bidding is a commonly used method by contractors to secure business for their companies. A typical bid price consists of three main cost
components; direct costs, indirect costs and mark-up. While there are methods for estimating direct and indirect costs with or without
contingency, there are fewer tools for estimating mark-ups. This study introduces Multiple Regression (MR), Artificial Neural Network
(ANN) and Adaptive Nero-Fuzzy Inference System (ANFIS) techniques for estimating markups, utilizing data collected from contractors in
Canada and the USA. To facilitate the modeling process, thirty factors, recognized to impact the mark-ups of estimates and 23 of which are
clustered in into five independent categories: need for work, job uncertainty, job complexity, market condition, and owner capability. The
ANN, ANFIS and MR models are developed using “MATLAB 2017a” and the results obtained by these methods are compared to their
respective performance against the actual estimated markups by the contractors. The ANFIS model yielded more accurate estimates than
the other two (2) models.

King County’s Wastewater Treatment Division (WTD) serves 1.7 million people in a 420-square-mile area around Seattle, Washington. Long
term system planning for public agencies such as WTD requires early commitment, allocation, and buy-in from decision-makers and
stakeholders to deliver their target mission. However, communicating projected scope and costs for early needs identification in the
conceptual planning stage is daunting. Although Class 5 conceptual estimates are typically considered for near-term use, long-term system
planning necessitates a 25- to 30-year forecast. In hindsight, public agencies are often criticized for not accurately predicting final total
project costs. Stakeholders often do not understand the limitations of early cost estimates and anchor to the lowest, most optimistic
expectations.

WTD embarked on a multiyear process to improve cost-estimate communication. As a result, WTD developed a pre-Class 5 estimate
methodology for communication of conceptual costs. This strategic planning-level estimate is focused on understanding costs early in the
project life cycle with limited scope definition.

WTD will present its approach to the development and communication of conceptual planning costs. This information is beneficial to a
wide range of project planning and delivery professionals with various levels of expertise in total cost management, project control, cost
engineering, and project management.
Scope definition, estimation of project costs and excellence in project management are core ingredients for success of mega projects.
Complex projects are common across various sectors including oil and gas, transportation, nuclear, construction and science and therefore
it is essential to implement project management strategies, scope identification and accurate cost estimation to improve their outcomes in
parameters of time, quality and budget. Many of the current construction management practices created are for traditional projects. The
analysis of literature and lessons learned suggests that there is need for innovative project management strategies to manage first of a kin
complex projects more effectively.

Problems related to first of a kind megaprojects include their complex nature, the use of traditional technologies, inappropriate project
management strategies and environmental conditions. Consequently, such factors are responsible for affecting the quality and cost of the
projects. It is essential to identify the project’s scope during the initial stages of the project to ensure that it is aligned with project goals
and does not affect the quality of the project; as well as supporting the preparation of cost estimates that are reliable and disciplined.

Cost estimate uncertainty is an integral part of the risk management strategy for a project, which is an influential factor in affecting the
total cost of megaprojects. When risk is managed appropriately, it can help in reducing the cost of the project, ensuring that quality and
time parameters are met. Additionally, project success is dependent on other factor such as accurate cost estimation, risk analysis, use of
high quality engineering, strong and robust project management strategies and team coordination and communication.

Based on the authors’ experience on megaprojects in the field of large nuclear, scientific and infrastructure projects, the paper describes
effective practices to achieve improved project outcomes by implementing high quality cost estimating processes, honest communications
proper organizational structures, risk analysis, progress and cost control for each project phase using best project management practices
and standards.

Selecting cost estimation methods that adequately fit the available data is difficult and holds great risks: Overly complex and time-
consuming methods often lead to forcing assumptions that narrow the path for future development, while too simple methods that do no
consider all known relevant data lead to lack of information.

The availability of data is closely linked to the progress of technology development. Technology readiness levels (TRL) are a popular concep
for evaluating the maturity of development projects in government, industry and science. Since existing TRL guidelines remain unspecific t
technologies, the need for a specification of TRL assessment for the chemical and process industries was identified. The first part of this
paper gives detailed TRL criteria and indicators for the chemical and process industries.

The second part provides a guideline for the selection of adequate cost estimation methods by aligning existing estimation frameworks
(e.g. AACE International classes) with the TRL scale and giving specific methods, estimation purposes and error ranges for each TRL. Finally
appropriate indicators for economic assessment are proposed for each TRL.

Cost estimate validation is often mentioned in AACE® International literature but not described in depth. This paper describes the practice
of cost estimate validation including a method called ratio-to-driver. Validation starts with the business establishing an objective in terms o
a cost strategy that is captured in the basis of estimate document. The cost strategy defines the estimating approach in respect to desired
base estimate bias (and every estimate is biased). Achievement of the cost strategy is the quality being assured by validation. Then,
reliable, normalized metrics (cost estimating relationships in ratio form) are developed from a comparison set of projects drawn from an
historical database (or obtained from some other reliable source). Database systems often do double-duty as validation tools; a precursor
to the future of analytics and machine learning. The ratio-to-driver method applies the metrics in a logical, stepped sequence of
comparisons that seeks to pinpoint the cause of variations. Because base estimate bias is a systemic risk, and validation measures bias,
validation is also a first step in quantitative risk analysis. While a long-established practice, estimate validation is not defined in AACE® cost
engineering terminology (RP 10S-90) and is only superficially covered in other estimating RPs. As such, this paper is intended as a basis for
an RP that will be aligned with others that include validation or benchmarking. The primary effected RPs (with abbreviated titles) are: 31R-
03 (estimate review), 34R-05 (basis of estimate), 35R-09 (estimate planning), draft CE-81 (estimate requirements) and 42R-08 (parametric
risk analysis).
Smart city projects will dramatically improve urban living, if they succeed. Many cities and traditional infrastructure construction
contractors are being challenged to understand, estimate, budget, propose and execute complex technology development and deploymen
projects. Failure to understand the internet of things (IoT) and other technologies, combined with typical contractor over-optimism, resul
in under estimates that may lead to disaster. Urban living will only improve if these projects start out with solid baseline cost and schedule
estimates.

New research shows that credible estimates can be achieved by leveraging benchmarks and lessons learned from defense and security
command, control, communications, computers, intelligence, surveillance and reconnaissance projects (C4ISR). New smart city statistical
predictive cost and schedule models, along with proven C4ISR predictive models, are a critical resource for city governments and
contractors undertaking these challenging projects. This paper will describe these models and illustrate the value of accurate estimating
through a smart city project case study.

Regardless of a project's complexity or magnitude, predicting its costs requires dealing with many factors such as uncertainties, escalation
and inflation. In hyperinflationary economies, predicting the cost of a project with the highest possible accuracy is a particularly difficult
task that requires the development of methodologies or procedures. It is of primary importance that the cost estimate should be traceable
and all its elements should be easy to identify because constant updates will certainly be made. This paper discusses this subject and
proposes some ways of dealing with hyperinflation in the context of cost estimation. The objective is to design a calculation procedure to
enhance the accuracy of cost estimates by including the impact of hyperinflation. This impact would be added to the costs obtained with
the traditional method for materials, construction equipment, labor, indirect costs. This proposed methodology is oriented to projects wit
a high level of definition or in the execution phase.

This session provides an introduction to 3 new or revised Recommended Practices: CE-81 (Owner's Estimate Requirements Document - as
Applied in Engineering, Procurement, and Construction for the Process Industries); 36R-08 (Development of Cost Estimate Plans - as
Applied in Engineering, Procurement, and Construction for the Process Industries); CE-95 (Development of Cost Estimate Bases - as Applie
in Engineering, Procurement, and Construction for the Process Industries).

The content and use of the documents will be explained, in particular the new sections on Class 4 and 5 estimates. The relationship
between each will also be discussed. This session is also intended to provide an opportunity for attendees to openly discuss the use of the
documents.

This session outlines the need for a well defined estimate basis. When prepared correctly, any person with appropriate experience can use
the BOE to understand and assess the estimate, independent of any other supporting documentation. A well-written BOE achieves those
goals by clearly and concisely stating the purpose of the estimate being prepared (i.e. cost study, project options, funding, etc.), the projec
scope, pricing basis, allowances, assumptions, exclusions, cost risks and opportunities, and any deviations from standard practices. In
addition, the BOE is a documented record of pertinent communications that have occurred and agreements that have been made betwee
the estimator and other project stakeholders. The BOE is characterized as a deliverable that documents the scope and cost of the project,
and ultimately becomes the basis for change management.
This presentation is based on 106R-19 (Development of Cost Estimate Basis - as Applied in Engineering, Procurement, and Construction fo
the Process Industries); and 34R-05 (Basis of Estimate).

This session outlines the requirements for a well defined estimate plan. The early development of this document is crucial for a successful
estimating process. The proper preparation and presentation of this key document greatly increases the likelihood of obtaining the desired
results by all stakeholders. The Estimate Plan should identify key stakeholders, expectations, standards, scope definition, schedule,
individual responsibilities, and expected methodologies. The plan provides opportunity to clarify expectations of stakeholders, allows time
for proper preparation of estimate inputs, and generally results in less rework and/or unacceptable deliverables.
This presentation is based on 105R-19 (Owner's Estimate Requirements Document - as Applied in Engineering, Procurement, and
Construction for the Process Industries); 36R-08 (Development of Cost Estimate Plans - as Applied in Engineering, Procurement, and
Construction for the Process Industries); and 35R-09 (Development of Cost Estimate Plans - as Applied for the Building and General
Construction Industries).
This presentation for estimators (or any other Project Controls professionals seeking a better understanding of estimating) is a follow-up to
TCM-XXXX Project Controls Overview: Putting Together the Pieces of the Puzzle. This session is based on the AACE publication Skills and
Knowledge of Cost Engineering (6th Edition) Chapter 9 and provides a brief introduction to each facet of estimating including; estimate
classification, required inputs and maturity level of the inputs to the estimate, planning the estimate, structuring the estimate, various
common methodologies used to develop conceptual and deterministic estimates, estimate accuracy, risk analysis and contingency, the
importance of integration with Cost and Schedule, documenting the basis of the estimate, and proper estimate presentation, review and
validation.
Each section of this presentation will be examined in detail in subsequent sessions throughout the remainder of the four days.

The focus of this paper is to provide a detailed overview of deterministic estimating and will include: 1. methodology of a deterministic
estimate; 2. the variations of detailed estimates (detailed, semi-detailed, and forced detailed); 3. Application of deterministic estimates
based on the level of scope development or estimate class; 4. Preparation of a deterministic cost estimate and prerequisite items; 5.
Adjustment allowances to account for productivity, escalation, contingency, etc. and 6. Challenges faced with the development of a
deterministic estimate.

When investing capital in projects, every plant owner has the right to know what they are buying, how much they are paying for what they
are buying, is that a reasonable cost, and what are the risks. The optimal chance of success is for the project development team to “think
like an owner”.

A simplified approach, process, and tool are identified in this paper for owners and their internal and/or external resources to use during
the early stages of industrial plant project development to answer these questions.
This process supports a high-level snapshot confirmation of the owner and project team understanding, application, and resolution of the
issues, risks, and opportunities necessary to accommodate today’s changing and aggressive business climate.

This approach:
• identifies and communicates owner expectations in the early stages of project development
• helps to confirm the owner and project team understanding of the risks the owner will or will not accept,[1]
• entices the project team to identify the level of potential for change in five major areas of project development during FEL
• captures and communicates the best professional judgement of the project team leaders at a single point in time occurring
immediately prior to requesting full funding decisions,
• facilitates identification of previously unspoken, unresolved, or forgotten significant issues and opportunities,
• minimally confirms the level of completeness of the capital funding request,
• supports final contingency recommendation,
• is performed using a sustainable globally available tool, and
• identifies how owners define and use contingency verses the range of accuracy in project funding decisions

There are many challenges when faced with creating estimates for software development projects. However, without a doubt, the single
largest driver for cost, effort, and duration is project size.
The typical approach to sizing a software project, if it is tried at all, is to 'estimate' software lines of code (SLOC). While this may be the
most expeditious method, history has shown that this approach usually produces highly inaccurate estimates.
IBM developed function points as an alternative method to bring about more consistent and accurate project sizing for use in software
project estimation. This methodology, while not a perfect solution, has enjoyed great success in more than 35 years of use worldwide.

This presentation will provide a brief overview of the International Function Point Users Group (IFPUG) Function Point sizing methodology
its key concepts, as well as strengths, limitations, and misconceptions. Function point-based metrics, FP based contracting and other key
uses for FPA will be covered. The presentation will also detail why FPA is preferable to SLOC or other sizing methods when creating
software development project estimates.

The International Function Point User Group (IFPUG) function point analysis software sizing methodology has been successfully used by
organizations for 30+ years. However, there remains confusion in the industry as to how the process works. Anyone who's heard of
function points, but is not a practitioner, often does not understand how the functional requirements of a software project are
'translated' into function points. This presentation demystifies the Function Point Analysis (FPA) process and educates those interested in
how function points are counted and/or are considering the use of IFUG Function Points in their organizations. The presenter will discuss
functional vs. non-functional requirements, provide examples of good and poor requirements, and how an FP count is developed based on
the functional requirements.
Quantification of project cost risks prior to full funding is well established requirement and practiced by many companies as part of norma
project development requirements. This presentation shares how ExxonMobil utilizes detailed cost estimates ("bid check") to model fixed
price bids on large ventures (>>1 G$) to assess both bidder understanding of job requirements on direct and indirect accounts as well as
associated imbedded financial risk assessments. An overview of work processes and practitioner skill requirements to accomplish this
outcome will be shared. This presentation will be supported by case studies that demonstrate the value and insight which this process
produces on world-class size ventures.

The outputs of estimating are typically a primary input for business planning, cost and risk analysis, management decisions, and project
cost and schedule control processes. All these aspects of corporate strategy and project planning are bounded, or guided by, an
organization’s risk appetite.

Estimating is fundamental to the ‘Assess’ & ‘Treat’ steps of risk management, as defined in AACE’s Total Cost Management Framework
(TCM) and Skills and Knowledge of Cost Engineering 6th Edition (S&K6). Estimator skill is required to determine the cost impact of the
risk (assess), and the cost to implement the plan to address the risk (treat), respectively. The cost impact of the risk contributes to the
amount of contingency required. However, there are several facets of strategic planning wherein the cost estimating process can introduc
assess, or mitigate risk.

This document addresses the topic of estimating as it pertains to risk and the various facets of project risk, which can be affected by the
cost estimate and the methods by which the estimates are developed. This paper is aimed at the junior to intermediate cost engineering
professional and provides a single source for AACE references on this subject.

A common issue often faced by estimators is how to prepare an estimate when there is little information or scope definition on which to
base the estimate. This paper provides an overview of conceptual estimating methodologies commonly used for the preparation of Class 5
estimates. Particular application to preparing capital facility estimates for the process industries is used although the techniques can be
used to support estimating in other industries as well.

There are many order-of-magnitude or conceptual estimating methods, and each can be useful in a specific situation. Often, a single
estimate may rely on using a combination of estimating techniques for different portions of the project. The conceptual estimating
methods that will be discussed in this paper include:
• Analogy Estimating
• Capacity Factored Estimating
• End-Product Units Estimating
• Physical-Dimensions Estimating
• Parametric Estimating
• Expert Judgement

This paper expands upon an earlier AACE International paper So You Think You’re an Estimator? [1], incorporating information from AACE
International (AACE) recommended practices such as AACE RP 59R-10: Development of Factored Cost Estimates – As Applied in
Engineering, Procurement, and Construction for the Process Industries [2]; as well as from other sources, such as Sharpen Your Cost
Estimating Skills [3], an article reprinted in the AACE Cost Engineering Journal.
Most estimators realize that one of the essential ingredients for preparation of an accurate cost estimate is the comprehensive and
sufficient definition, and subsequent control of project scope. Numerous studies have identified project scope definition as one of the mos
critical factors that influence project success. In 1982, the Construction Industry Institute (CII) Business Roundtable issued a report stating
that “poor scope definition at the (budget) estimate stage and loss of control of project scope rank as the most frequent contributing
factors to cost overruns."" [1] Nevertheless, obtaining adequate scope definition to support cost estimating continues to be one of the
most persistent problems faced by estimators.

This paper discusses issues involved in dealing with scope development problems during the preparation of capital facility cost estimates.
Topics to be covered include:
• Introducing a stage-gate project development process
• Identifying the minimum requirements to prepare various classes of estimates
• Communicating information requirements to project teams and estimate providers
• Corelating estimating techniques to the level of scope information
• Utilizing a frozen for estimating design basis and incorporating late changes
• Presenting the estimate in relation to the level of scope definition
This paper expands upon an earlier AACE International paper Scope Development Problems in Estimating [2], incorporating information
from AACE International (AACE) recommended practices on estimate classification, as well as from other sources.

This paper explores the definitions and relationships of three total installed cost (TIC) estimate elements: base estimate, estimate accuracy
and contingency. These elements have various meanings and applications in process industries and the author seeks to present a clear
perspective for their consistent use and quantification. Base estimate represents the most likely cost outcome of a project, within a range
of probable outcomes, and is the basis for quantifying other estimate parameters. The base estimate value includes direct costs, indirect
costs and design allowance, but does not include contingency or management reserve. Estimate accuracy is best measured from the base
estimate value, rather than the TIC estimate value (base estimate plus contingency). Although the latter method is commonly used, it may
undermine the purpose and definition of a base estimate by shifting the accuracy range high enough to exclude the base estimate itself (if
contingency is much greater than the interval between the lower accuracy boundary and the base estimate). Contingency is used for a
variety of purposes, sometimes insufficiently and sometimes excessively. The author presents contingency as an addition to the base
estimate for the purpose of establishing the TIC estimate value at a desirable confidence level for project funding.

This presentation will review the basic concepts and principles of cost estimate classification systems as addressed in the AACE
International (AACE) series of Recommended Practices (RPs) on the topic. The presentation will focus on Professional Guidance Document
No. 1 (PGD-01) that was released by AACE in 2018. PGD-01, a hyperlinked online document, provides a roadmap for finding RPs relating to
classification and estimate accuracy while also discussing the concepts and principles of classification. The presentation will also share the
history of the concept as it evolved from the first AACE guideline on estimate types in 1958. Today, there is a series of industry-specific
classification RPs aligned with common project phase-gate systems; these will be reviewed.

This paper reviews cost estimates for decommissioning and fully removing the 23 oil and gas platforms located on the federal Outer
Continental Shelf offshore California and estimates the costs that could be avoided (saved) if the platform jackets are partially removed an
reefed in-situ rather than fully removed. The cost savings are calculated by estimating the weight of the jacket structure that would remain
in-situ and multiplying that weight by a demolition cost ranging from $3,000 to $7,000/ton (short tons) for structure removal. This cost
range was derived from a review of published information on estimated and actual jacket removal costs. The calculations show that if all 2
platform jackets are reefed in-situ the estimated total cost savings achieved would range from $856 million to $2.0 billion. Reefing is the
process of removing all oil and gas related equipment and material that might contaminate the ocean from an offshore facility and leaving
the remaining steel structure as habitat for marine life. On a per platform basis, the cost savings range from a low of $0.3 million for
Platform Gina (84 tons remaining in-situ) to a high of $494 million for Platform Harmony (70,540 tons remaining in-situ). Under the
California Marine Resources Legacy Act (AB 2503) the owners of oil and gas platforms who obtain approval to reef a platform jacket are
required to share 65% to 80% of the cost savings with the State of California. Based on the cost savings estimates presented in this paper,
the State of California would receive an allotment ranging from a low of $685 million to as much as $1.6 billion if all 23 OCS platforms were
approved to be reefed in-situ.
This article will discuss environmental restoration cost classification for projects within a regulatory framework that involves development
of formal documentation, public input from external stakeholders, and ultimate approval by a regulatory authority. This regulatory
framework has a specific focus towards environmental compliance under the Resource Conservation and Recovery Act (RCRA) and the
Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). These United States (U.S.) federal laws are perhaps th
best understood as a generic framework for environmental remediation that can serve as a proxy for other regulations (at international,
national state and local levels) through the organization of the necessary steps of an environmental cleanup though six consecutive phase
indicating increasing maturity, described in detail in this article. Also, the reasoning and support for the classification of environmental
restoration project cost estimates in relation to their maturity will also be discussed. In addition, the role of risk in environmental
remediation projects is discussed.

Presenting capital cost estimates can be challenging, especially when it involves the presence of clients, colleagues or perhaps a third-part
review team. The pressure of preparing and presenting is coupled with the efforts of simply trying to finish an estimate on time.
Requirements can vary according to the nature of each project, class of estimate, level of detail, type of client, time limits, and a host of
other factors, and therefore a simple one-size fits all approach, or presenting the full estimate plan or basis of estimate is not ideal.
Presentations are a powerful tool in helping to convey a message to clients, and it is sometimes the first window the client has into the
overall estimate, so it’s important to deliver the best product, as future opportunities may be limited.

This article will attempt to discuss the important items to consider when presenting an estimate to a client. The intention is to create a
starting point for estimators and project controls staff to use in the development of presentations from high level studies to detailed
estimates and provide a basis upon which others can further develop and tailor their own set of standards.

Estimate presentations should also consider various technical and soft skills which can also help in the presentation process. Ideally, it
would be recommended to consider developing custom presentation templates for various levels of estimates and applications, gradually
improving and incorporating feedback into each subsequent version.

This presentation will align the core estimating skills, knowledge, roles and responsibility for Project from various AACE International
recommended practices. This presentation will outline the core competencies of a project estimator. The following is the list of project
estimator discussion topics:
• Planning the Estimate
• Estimate Methodologies
• Quantification
• Costing
• Pricing
• Estimate Conditioning
• Risk Evaluation and Contingency Determination
• Estimate Documentation
• Estimate Reconciliation
• Estimate Review and Validation
• Estimate Reporting
• Estimate Closeout
This presentation will discuss the roles and responsibilities in relation to career development of a project estimator. This will outline the
roles and from entry level to estimating manager.
This presentation will pull from key areas of the following AACE RPs:
• 11R-88: Required Skills and Knowledge of Cost Engineering
• 46R-11: Required Skills and Knowledge of Project Cost Estimating
• 101R-19: Roles and Responsibility of a Cost Estimator