A plant producing succinic acid from the fermentation of cane sugar, with a planned capacity of 30,000 ton/annum, requires a total investment of $145 million (working capital of $3 million).

The raw materials and utilities requires are

The fixed operating cost can be estimated as follows:

The selling price of succinic is $1.5kg.

The depreciation is 10% of FCI per annum. Neglect the salvage value. The tax rate is 40%.

Determine the ROI and payback period for the project.

Raw materials Cane sugar Process water Utilities Electricity Natural gas Cooling water Requirement (tons/year) 50 000 55 000 Requirement 38 000 MWh/year 2 000 000 GJ/year 3 500 000 tons/year Price ($/ton) 212 0.27 Price $ 0.07/kWh $4.1/GJ $ 0.04/ton Maintenance Labour Supervision 5% FCI/annum $1 000/month 4 operators per shift, 5 (8-hour) shifts per week 30% of labour costs Salary overheads Laboratory expenses Operating supplies Insurance, royalty etc. Plant overheads 30% of labour + supervision costs 15% of labour costs 15% of maintenance costs 3% of FCI/annum 50% of labour, supervision and maintenance