While other firms have engineering, construction, or manufacturing backgrounds, we have the full range of EPCM capabilities. Plus, we have the operational expertise that allows us to understand your desired end result and guarantee optimal performance. Having a project manager who knows not only how to build plants, but also how to operate the plant has a big impact on your startup time and overall operating costs. Large scale capital projects involve significant amounts of money and capital expenditures can easily get out of control.
What is Capital Expenditure?
Capital expenditure - capex for short - is a specific amount of money used to acquire or upgrade a business asset. Common examples of a capital expenditure would be a new building, a new facility or an upgrade to an existing facility. A capex is usually considered to be a deductible, because it represents an improvement to the business overall. This is deducted over the expected life of the item, rather than all at once in the case of repair or maintenance expenditures. Whether you need help managing a capital expenditure to be used for a dam, an aggregate plant, a gold mine, a frac sand plant or other facility, we are here to help.
A capital expenditure is amortized over the length of the life of the investment, which may range from an expectation of 5 to 40 years, depending on the investment. The time period is known as a recovery period. A recovery period is necessary for a company that is investing in major assets so a company will known how to deduct capital expenditures. The amortization means that the company cannot deduct the cost of the capital expenditure all at once and must spread it out over the life of the investment.
Benefits of a Capital Expenditure
A capex should create future benefits. A plant that may cost you $20 million dollars can see a return of much more than that over five to ten years. An investment in plant, property, and equipment that constitutes a major financial decision for a company must be formalized and approved at an annual shareholders meeting or a special meeting of the Board of Directors. In an accounting sense, a capital expenditure is added to an asset account (“capitalized”), thus increasing the asset’s basis (the cost or value of an asset adjusted for tax purposes). Done right, a capex will help get your company to the next level of production and distribution. Done wrong, a capex can represent thousands upon thousands of dollars in damages to the company.
At TPS we believe that success starts with people. Our experienced project managers have a well-earned reputation for completing projects safely, on time and on budget. All TPS project managers have a minimum of 20 years of experience and undertake the following:
Define the complete scope of the project
Create realistic time lines and Gantt charts
Develop and execute a project plan
Determine the capabilities of all of the required resources
Directly manage all subcontractors
Track progress of all project activities
Develop and track budget versus actual costs
Clearly communicate with all stakeholders
Provide daily on-site support for the duration of the project
Provide leadership throughout the project
Execute the startup and commissioning process
We are experts at what we do and always deliver on the promises that we make. To see the scale of some of the projects we have worked on, take a look at the ‘Our Work’ page. If you need capex or project management in the engineering, procurement, or construction fields, look no further. Our compass package will define a comprehensive plan with itemized projections on what the finished product will cost to produce. We collaborate with the capex team to incorporate as many operationally efficient items in the initial plant as possible. Your business risk is substantially reduced by proper planning and a solid operational plan prior to the construction of the plant.