PROJECT MANAGEMENT FOR CHEMICAL

ENGINEERS

B. Peachey1, R. Evitts2 and G. Hill2,

1
New Paradigm Engineering, Edmonton, AB, Canada.
2
Department of Chemical Engineering, University of Saskatchewan, Saskatoon, SK, Canada.

Abstract: In North America, chemical engineering undergraduate curricula do not usually

contain compulsory courses dedicated to project management. Yet, early in their careers, chemi-
cal engineers are frequently assessed based on their abilities to completely solve an industrial
plant problem. The complete solution involves much more than just technical calculations.
Issues such as scheduling, scope, quality, safety and costs must always be addressed. In this
article, the ingredients of three lecture hours of material dedicated to introducing chemical
engineering students to the important area of project management are described.

Keywords: project management; planning; costs; performance; quality; safety; contracts; risks.

INTRODUCTION begin their careers in remote field offices,

Correspondence to:
Dr G. Hill, Department of
Chemical Engineering,
57 Campus Drive,
University of Saskatchewan,
Saskatoon, SK, S7N 5A9,
Canada.
E-mail: gord.hill@usask.ca
DOI: 10.1205/ece06019
1749–7728/07/
$30.00 þ 0.00
Education for Chemical
Engineers
Trans IChemE, Part D,
Volume 2, 2007
# 2007 Institution
of Chemical Engineers
Chemical engineering curriculum contains
large quantities of material that ensure stu-
dents focus on learning the technical details
of our profession. However, problems in
industry always involve much more than just
finding technical solutions. Industrial problem
solving includes issues such as scoping the
extent of the problem, establishing timelines,
finding technical support and suppliers, finan-
cial issues, safety and reporting. Handling all
these issues efficiently is the domain of pro-
ject management. The subject of project
management is covered extensively in many
books and texts (e.g., Dinsmore, 1993;
Watson, 1997; Kerzner, 1998; Lewis, 1998;
Melton, 2005). University courses dedicated
to project management topics are not uncom-
mon and are often available as elective
courses in chemical engineering. However,
in North America, due to the rules of accredi-
tation and the very limited ability to incorpor-
ate new courses, very few chemical
engineering programs include a single com-
pulsory course dedicated to project manage-
ment. In fact, in a survey of 28 Canadian
and American Chemical Engineering Depart-
ments (all randomly selected from the
AIChE Directory, Qin and Swinnea, 2006),
only one had a compulsory project manage-
ment course. Nevertheless, project manage-
ment is part of every engineering task, and
the understanding of project management
principles is often left for new graduates to
learn on-the-job. Many chemical engineers
established manufacturing facilities, or plant
sites where there may be very little opportu-
nity to learn project management skills from
mentors, except through occasional contact
with senior engineers in the head office.
Therefore, most students will benefit from
having some exposure to basic project man-
agement concepts to help them avoid unplea-
sant experiences in the early days of their
careers.
In the workplace there are two types of
managers. Functional managers take care of
a dedicated department and normally have
direct authority over a budget and personnel.
Project managers, on the other hand, fill
temporary positions established to accom-
plish a specific task, the project. Project
managers often have little authority, aside
from what they are assigned in the direct pro-
ject budget, and must rely on their personal
powers of communication and persuasion to
influence the members of his or her manage-
ment team (personnel seconded from com-
pany departments) to work diligently on the
project goals.
At the University of Saskatchewan, project
management lectures have been included in
the third year compulsory course, ChE 325:
Introduction to Process Engineering. This
course has a total of 37.5 h of lecture material
that introduce students to a wide variety of
skills needed in their final year, capstone
design project. In ChE 325, the topic of project
management is covered in one week of lec-
tures (two, 1.5 h lecture slots) in which five

Vol 2 14–19
 PEACHEY et al.
topics are discussed (A to E): Lecture 1: (A) introduction to
the topic of project management and ensuring access to
needed support is available before accepting a project; (B)
scoping, planning and getting approvals prior to starting
physical work; Lecture 2: (C) contracting for engineering
and construction activities; (D) project execution with regards
to health, safety, environment, cost, quality and schedule;
and (E) special features of small projects. Each of these
topics is detailed in the paragraphs that follow.
PROJECT ENTRY
The project manager needs to be clear who the clients are
(such as a direct supervisor, a senior manager in another
department, an external company manager, a government
agency official, and so on), what problem needs to be
solved and why that problem needs to be solved now. Do
the clients really understand and agree on what outcomes
they are looking for, and can they communicate that unam-
biguously? Do they expect the problem to be investigated
only with written and/or oral reports; or do they expect the
problem to be physically solved? In addition, what assump-
tions have already been made about this problem and
should those assumptions be examined? The project man-
ager must ask many questions in order to feel comfortable
that the problem is well defined and within his or her exper-
tise. Answers to these questions will focus the work directly
on the task to be solved, help prevent the project manager
from straying in the wrong direction, and will help ensure
that the clients are happy with the project results. In return,
the client will usually be impressed that the project manager
is interested in understanding the essence of the problem
and determining how urgently the problem needs to be
addressed. Details of constraints that must be met, how
often the client requires feedback on the progress of the
work, and client contact information in order to discuss any
problems that may develop during the work must be estab-
lished. A key issue will be the resources that can be used
to solve the problem and these should be decided before
the project is accepted. Resources needed to solve most
engineering tasks include: money and an account to
charge expenses, time to solve the problem, personnel sup-
port both within and outside your organization, and authority
to make decisions such as spending and contractor
selection.
At the project entry stage, the project manager must realize
project tasks will always include: planning the work; commu-
nicating clearly and motivating those who will work with him
or her to solve the problem; monitoring the timeline, quality
and expenses of the project; ensuring health, safety and
environment issues are clearly addressed; and responding
quickly to solve deviations from the proposed work plan.
There is never a time that problems will not occur during an
engineering task and it is wise for the project manager to
believe that Murphy was an optimist, whatever can go
wrong will go wrong but more than once.
The new project manager will have to learn to use several
software tools that are commonly used to plan and control
company projects. These tools may be company specific or
general, such as Microsoft’sw Project software. Project can
help in the planning of work schedules and monitoring of
budgetary issues.
Trans IChemE, Part D, Education for Chemical Engineers, 2007, 2: 14–19
15
Project Entry Example
Problems at the project entry level often occur because the
problem was not well understood by the client, consider the
case where the project manager was asked to solve a pro-
blem of unsafe volumes of gas venting from a water tank in
a gas plant. The assumption of the client was that a vapour
recovery system would be needed to collect and recycle
the venting gas. The project was initially scoped and bud-
geted on that basis. The project manager, however, did
some quick calculations and a site visit, which showed that,
based on physical properties and flows, the vented volumes
were much higher than what should have been expected.
A check showed the root cause of the problem was a rock
in the seat of a water level control valve on an upstream
separator. The project was cancelled, and maintenance
was carried out on the valve. A much smaller vapour recov-
ery system was eventually installed many years later for
odour control on the tank.
SCOPING, PLANNING AND APPROVALS
In the next phase of the engineering project, the project
manager begins by itemizing in writing all the information
gathered in the Project Entry phase in order to confirm the
true scope of the work. This is followed by the preparation
of preliminary plans, and finally approval of the plans by
the client. No work should commence until the plans are
approved. In the previous Project Entry phase, the manager
was evaluating the substance of the project, while this phase
becomes one of more critically defining the project by
preliminary planning and design. The more detail that is
developed in this planning and designing stage, the more
likely the project will run smoothly and reach a successful
conclusion.
After accepting the project, an initial task for the project
manager in this phase is gathering data. Most projects
involve a physical structure to be modified or built, and an
important task for the project manager is to determine soil
properties, the geology of the area and ecological issues
that may affect the work. Since these are typically technical
tasks that are beyond the expertise of chemical engineers,
it is important that assistance is available either within the
company or in the form of external consultants. Thus, the pro-
ject manager must assemble a project management team
with participants that have a variety of skills to assist in com-
pleting project tasks. The project manager must realize that
due to his or her limited expertise and usually even more lim-
ited time, he or she cannot possibly complete engineering
projects on their own. So it is important that access to person-
nel and equipment needed to successfully complete the
design task is readily available. However, it is equally import-
ant that the project team be no larger than it has to be, to
meet the scope of the project, no more than five or six
people under the direct supervision of the project manager.
Each team member will have clear responsibilities and
resources allocated to them to complete their objectives.
Team members will be expected to manage those responsi-
bilities with little interference from the project manager,
unless their tasks are not getting completed. To help organize
the team, a useful tool is the task responsibility matrix. This
two dimensional table places the team members as the
titles of the columns and the tasks to be performed
16 PROJECT MANAGEMENT FOR CHEMICAL ENGINEERS
(preferably in chronological order) as titles of the rows. Each
team member is placed in charge of separate tasks, but it is
realized that the team will not have all the expertise to carry
out all components of each task. In those cases, outside sup-
port will be flagged, such as consultants or operations staff.
Regular team meetings are needed to share progress
reports. However, the team is not a democratic committee
and if the project manager is convinced that bottlenecks
are occurring, he or she may have to make personnel
and resource changes to ensure the project is completed
efficiently and in a timely manner.
Problems may have been identified during the initial plan-
ning stage, for instance if a structure is needed to be built
on or near government parks or historical sites, delays will
occur in order to obtain permission to proceed with the
work. The project manager will need to study the regulatory
issues that will govern the project, the social climate at the
location of the work, and the availability of goods and ser-
vices that will likely be needed to do the work. Many steps
of the Project Manager’s work will likely fall under industrial,
legal or professional regulations or guidelines. For instance,
in the Province of Saskatchewan, the Engineering and
Geoscience Professional Act addresses issues such as con-
tracts and bids for major engineering projects. If the project is
large and located far from a populated area containing skilled
labour, a temporary labour force may be needed, so that
camps and travel issues must be considered. Using historical
information for similar projects and information gathered on
local issues, estimates of how fast various stages of the
project can be completed must be made.
In developing the Project Technical Plan, the management
team can make good use of Failure Mode Effects Analysis,
FMEA, when estimating where to allocate scarce resources.
In brief, FMEA requires the team to assign numbers to each
of three risk factors: probability of risk actually happening,
severity of the risk and finally ability of the team to detect
whether the risk will occur. The product of these three num-
bers is called the risk probability number (RPN). Resources
are applied in proportion to the value of RPN, the higher
the RPN, the more resources are applied to that risk factor.
Examples of common project risk factors include bad
weather, loss of personnel and technology failure.
The Project Execution plan is the key planning document
of this stage. It itemizes responsibilities of each team
member, engineering tasks, government and other stake-
holders, the work to be done, who will do the work, where
work is to be done, schedule of the work stages, approvals
and permits to be obtained, contracting strategy, labor
requirements, estimated costs, material procurement, con-
struction, health/safety/environment and commissioning/
start-up procedures.
Stakeholders outside the company, including government
organizations, must be considered at all stages. Regular
communications with these partners will help to prevent
nasty surprises when some of their concerns are not incor-
porated into the work. Unions should also be considered as
stakeholders and commitments to these organizations by
your company must be upheld. Most projects will require var-
ious sizes of work forces at different stages of the project, but
it may be possible to rearrange work stages to maintain a
fairly even contingent of labour at the site at most times.
It is clear that to be successful as a project manager, the
engineer needs good communication and motivation skills.
Trans IChemE, Part D, Education for Chemical Engineers, 2007, 2: 14–19
He or she will take ultimate responsibility for the success or
failure of the project and will be the key individual at all
stages of the work. Planning, coordination, decision-
making, delegating, documenting and time/cost control are
all tasks or skills that will be imperative to the success of
the project manager’s work. The members of the project
management team may change over time, with the import-
ance of individual inputs changing as the project continues.
For instance, process engineers will design the system to
begin with, have less or no influence during actual construc-
tion, but will likely return during commissioning and start-up
activities.
PROCUREMENT AND CONTRACTING
Once planning and approval are completed, a project
comes to life with the acquisition of workers, materials and
equipment needed to do the work. The project manager
needs to be aware of the proper procurement procedures
used in the company. Are local or national/international
suppliers used? Are open bids necessary or can targeted
businesses be approached? If bidding is used, ensure all
interested parties are dealt with fairly and ensure team
members avoid such things as gifts and meals that may be
construed as putting bias on decisions.
Details such as who buys materials are important. The
contractors with specialized knowledge in each work stage
are often the most qualified to make purchasing decisions
on bulk items and consumables, but these decisions should
still lie within your company’s policies of using local or other
suppliers and handling bids in a fair manner. Regardless of
the purchaser, members of the project management team
must stay on top of materials ordering, since it is important
that materials arrive just-in-time for their incorporation into
construction. Since lead time is inevitable, the orders must
be placed at the right moments in time, and some storage
must be made available at the construction site for materials
that arrive early. On the other hand, severe penalties must be
stipulated to suppliers who fail to deliver critical path equip-
ment items on time, since this can have drastic effects
on the project schedule. Ownership of materials is also an
important issue. For instance, when does ownership
change from supplier, to contractor, and then to your com-
pany? If damage occurs, ownership is a critical issue when
deciding who accepts the loss. What about ordering spare
units or the possibility of using surplus equipment that is
already available within your company’s inventory?
The selection of contractors follows the same rules as
materials procurement. Should local or other companies be
sought out? Is bidding to be used and should it be directed
towards select companies? What is the procedure and time-
line for receiving proposals and making the selection? Be
sure fair procedures are used and the bidders are aware of
all the procedures. The preparation and contents of each
contract should be as detailed as the whole project plan.
Detailed work and timelines of each contract must be clearly
specified. The obligations of both parties must be listed, as
well as the administration of the work. Clauses should be
included that cover how problems or discrepancies are to
be addressed. For most engineering tasks, payments must
be made as progress is made, since the financial burden of
large engineering or construction contract work is usually
 PEACHEY et al.
too much for contractors to bear, so payment scheduling and
appropriate measurable milestones must be included. When
assessing the bids, important issues to consider include the
experience of the contractors, the cost, and whether the bid-
ders have fully grasped the scope of the work to be done.
When a contract is to be awarded, four different types are
possible: (1) Lump Sum—is similar to purchasing a car, the
price is firm and based on the detailed specifications; the
contractor is responsible for delivering within that budget,
unless the client makes changes from the scope; (2)
Cost-Plus-Fee—is where the client pays all direct costs for
the project, as verified by invoices, and covers the contrac-
tors profit by adding a percentage fee; (3) Unit Price—might
be used to contract for insulation, where there is a fixed
price per unit of length of pipe sizes and insulation thick-
nesses; and (4) Time Rate—which might be used to supply
equipment such as cranes, where an hourly or daily rate is
charged for use or availability of a specialized piece of equip-
ment. It is important that the project management team has
regular and direct access to the contract work so that pro-
gress can be monitored. If changes need to be made,
direct access can help the team decide if they are really
necessary and if so, to help decide on what kind of changes
are best suited to meet the work objectives, and the impacts
of the change on cost, schedule, quality, and safety for the
project. The team member in charge of each contract stage
must also verify that the contractor is paying bills, since if
not, the owner may be held liable for unpaid expenses.
There has to be strict control measures placed on each con-
tractor, and any changes in project scope, so that cost over-
runs do not occur. The value of the work should be already
known to the project team from their expertise with similar
projects and/or documentation on typical costs for such
equipment and installations. The timeliness of the work
should be measured by strict metrics that were specified in
the written contract, and if deviations occur, the team
member in charge should develop strategies to help the con-
tractor get back on track. The cost and time factors for each
contract need to be frequently documented and information
provided to stakeholders so that all parties are aware of the
status of the work. Most projects, and component work
tasks, follow a typical ‘S’ curve in terms of percent com-
pletion, with slow starts, steady intermediate progress, and
followed by slow final completion.
Project Contracting Example
A major challenge in project management is anticipating
any issues which may arise during a project, so that the
response to the issue can be addressed in contract and pro-
curement documents. One issue that often comes up is
where there are multiple contractors working on different
components of a project, and friction or extra costs occur
where the work of one contractor impacts the work of
others. Normally the problem is that one contractor takes
longer to complete their assigned tasks, preventing other
contractors from starting, so there are usually incentives or
penalties included in contracts to prevent this. However,
this is not always the problem. In one case a pipeline contrac-
tor, with a lump sum contract, unexpectedly built up their
workforce and accelerated their work in advance of the
planned schedule, to allow them to move on to another
Trans IChemE, Part D, Education for Chemical Engineers, 2007, 2: 14–19
17
project. There were no contract terms to prevent this, in
fact there was a bonus for completing the work by a specified
date, but the rapid completion resulted in delays to other con-
tractors on the site due to higher than expected activity, and
also an increase in the cost when pipeline routing had to be
modified to accommodate the earlier than expected installa-
tions. In later contracts this problem was avoided by providing
a bonus for contractors exactly meeting the contracted
schedule, with penalties if they were too early, or too late.
QUALITY ASSURANCE
This item is the main focus of the project manager. It
includes ensuring that all aspects of the project meet
expected performance standards, meet all safety criteria,
comply with all government regulations and the project
work is performed in a balanced, cost effective manner. Per-
formance measures include ensuring equipment meets all
the technical specifications developed in the design stage
and set out in detail in the contracts issued to the contractors.
To meet this goal, appropriate manpower with appropriate
skill sets must be available to work directly with the project
manager. During the design work, issues to be reviewed
include schedule, costs, specifications, drawings, safety,
maintainability, operability and reliability. During construction
the quality assurance personnel check the credentials of
vendors and contractors, review the materials handling and
control procedures, record and verify construction changes
and ensure all contractor work is completed to the company’s
satisfaction, before payments are made. Finally, before
operations begin, the quality assurance personnel ensure
units have been tested, operating and maintenance manuals
are readily available, safety and emergency systems are in
place and working and finally that appropriately trained
operating personnel are on hand.
HEALTH, SAFETY AND ENVIRONMENT (HSE)
The project manager must make sure that these issues are
stipulated in all contracts and that appropriate safety equip-
ment and emergency response services are on hand at all
times during construction and start-up. Each contractor
must accept responsibility for HSE compliance during their
phase of work. Procedures for HSE and reporting require-
ments must be followed and appropriate penalties must be
in place for violations of these issues. Safety personnel
must be on hand to check procedures, materials, alarms
and equipment as well as to respond to emergencies such
as fires or spills during all stages of construction and oper-
ation. Government regulations must be followed and these
always stipulate that safety meetings be held at regular inter-
vals so that managers and personnel can freely input any
safety concerns about work that is being undertaken.
PRE-COMMISSIONING AND START-UP
Before contractors are paid and released from their obli-
gations, it is imperative that after each work stage equipment
is tested (pressure testing, vibration testing, control systems
working, alarm testing, and so on) to ensure it works to
expected performance levels. Each contractor must leave
18 PROJECT MANAGEMENT FOR CHEMICAL ENGINEERS
the site in a pristine state so that following work units are not
impeded in meeting their scheduled activities. When all con-
struction work is completed, all materials and supplies includ-
ing spare parts must be on hand and itemized before start-up
is commenced. Operators must have been fully trained and
oriented to the work site layout. Safe work permits and final
instrument monitoring checks must be on hand and carried
out by skilled personnel, probably brought in from similar
operating sites. The system should be purged, and then the
documented start-up procedures can be carefully followed
to bring the new project on-line.
WRAP-UP
The project management team should meet one last time
to provide design feedback, vendor and contractor assess-
ments and overall project feedback. This report will be a
vital piece of information to project management teams in
the future, or if any new problems show up after project
completion.
SMALL IN-PLANT PROJECTS
In some ways these types of projects are more difficult to
handle than large projects, since they are often taken for
granted by company management, and therefore less
resources are provided to the project manager to success-
fully complete the project. And yet, the outcome may be dis-
astrous unless the project manager ensures equal care and
similar due process is followed in completing small projects
as for major design projects. Thus it turns out that the project
manager spends much more of his or her time on the detailed
steps of small projects than on large projects, and the engin-
eering component of the project may be as much as 25% of
the final cost (versus 10% on a greenfield project) as many
peripheral systems will have to be checked to ensure they
can handle incremental loads. Also, dangers exist, since
the existing working plant contains hazards that all workers
must be aware of when they come to complete their
phases of the work. Operators must be informed on a daily
basis of project work that is starting or on-going in their
areas, feedback is needed from them regarding possible
safety problems and any ‘hot work’ must be supervised by
experienced operations personnel.
Small Project Example
Most industrial operations have now implemented change
management procedures to ensure that any changes made
in an operating facility are adequately reviewed for potential
consequences before they are implemented. Sometimes
even a seemingly simple request can potentially lead to
major disasters. A plant engineer received a maintenance
request to add some additional block valves to allow on-line
maintenance of two parallel, 100% spare, process vessels.
The spare allowed longer process run times between shut-
downs, but a full plant shutdown was required at some
point if both units went down, so the change was meant to
increase plant availability. The plant engineer designed the
piping to make the change. However, during the change
management review it was pointed out that this 1950s vin-
tage plant was designed on the basis of annual plant shut-
downs, and pressure relief protection was only provided to
Trans IChemE, Part D, Education for Chemical Engineers, 2007, 2: 14–19
the inlet and outlet of the plant, not on individual process
vessels or systems, and valves in the process were limited
to those required to redirect flow. Adding block valves, as
requested by maintenance, would have created the potential
for a high pressure situation in the process with no pressure
relief protection. Adding relief capability to the whole plant
would not have been economic compared to existing losses
due to flaring. The change was not implemented.
SUMMARY
Professional project management is the key to the safety,
quality, cost and schedules of all engineering tasks. Make
sure that when you accept these tasks you are clear on
what is to be done and are comfortable that the resources
needed to accomplish the work will be made available to
you. The key to success will be your initial and thorough
design plan and your ability to gather a qualified project
management team, while maintaining a high motivation
level in these members throughout the project lifespan.
You must stay on top of things by monitoring the pro-
gress and costs of each stage; and be prepared to take
action to correct deviations as each stage of the project
progresses.
EVALUATION AND IMPLEMENTATION
The lectures described above have been presented for the
past three years in our course. Students are assessed on
their ability to comprehend the material through a 15 min,
10 question quiz at the end of the last lecture and through
final examination questions. Following the quiz, students
are also provided an opportunity to give written feedback
on the quality of the presentations and usefulness of the
material. On a scale of 1 to 10, with 10 being the highest
score, the lecture rating is 9.4 (well above the overall Depart-
ment course average of 8.3). In their next academic term, stu-
dents are provided the opportunity to implement project
management activities through their final year, capstone
design project (as part of our course ChE 422: Process
Engineering and Design II). The majority of the capstone pro-
jects involve solving industrial design problems, while a few
projects involve scaling up new research processes devel-
oped in the College. Each design project is solved by a
design team made up of three students. The projects have
three phases: I. Project Definition and Alternative Selection,
II. PFD/PID Development and Process Modelling, and III.
Economics and Safety. For each phase, a different group
member acts as the project manager and is required to
implement the strategies identified in the process manage-
ment lectures. While acting as project manager, the quality
of the work done accounts for the majority of that student’s
mark in the course. Although no quantitative data is available,
it is very clear that the majority of students are enthusiastic
about their project management roles and take this responsi-
bility seriously. It is the professor’s opinions that this has led
to improvements in the quality of the final year design
projects.
REFERENCES
Dinsmore, P.C. (ed.), 1993, The AMA Handbook of Project Manage-
ment (American Management Association, New York, USA).
 PEACHEY et al. 19

Kerzner, H., 1998, Project Management: A Systems Approach to ACKNOWLEDGEMENTS

Planning, Scheduling, and Controlling (Van Nostrand Reinhold,
New York, USA).
Lewis, J.P., 1998, Mastering Project Management (Mc-Graw Hill,
New York, USA).
Melton, T., 2005, Project Management Toolkit: Supporting Success at
Every Stage (IChemE, Rugby, UK).
Qin, S.J. and Swinnea, J.S. (eds), 2006, Chemical Engineering
Faculty Directory (John Wiley & Sons Inc., Hoboken, NJ, USA).
Watson, C.S., 1997, Managing Projects for Personal Success
(International Thomson Business Press, London, UK).
The Department of Chemical Engineering at the University of
Saskatchewan is grateful for the ongoing financial assistance of
Dow Chemical Canada. Those funds support the continual improve-
ment of our undergraduate courses.
The manuscript was received 4 August 2006 and accepted for
publication after revision 10 December 2006.

Trans IChemE, Part D, Education for Chemical Engineers, 2007, 2: 14–19