Feasibility Studies: Just How Good Are They?

Virtually every new process plant project goes through the ?Feasibility Study? phase before actually being built. The Feasibility Study is used by the owners and the bankers to evaluate the economics of the project and determine whether or not the proposed investment meets their respective investment guidelines. With a positive result, the project is approved and goes to construction and operation. Then, the actual costs are incurred and these actual costs may or may not agree with what the Feasibility Study predicted. Just how good have Feasibility Studies been? This paper looks at various projects and compares predicted to actual results and also gives information on how to spot a poor feasibility study.