Lang factor

In a 1947 article for "Chemical Engineering" magazine, H. J. Lang introduced the concept of factors (multipliers) to relate the total installed cost of a process plant to the cost of the major process equipment within that plant. The factors have changed over the years because construction labor, bulk materials (concrete, pipe, etc.), engineering design, indirect costs, and major process equipment prices have not changed at the same pace. These factors are widely used in the refining and petrochemical industries to help estimate the cost of new facilities. A typical multiplier for a new unit within a refinery would be in the range of 5.0. This means if you add up the purchase price of all the pumps, heat exchangers, pressure vessels, and other process equipment, then multiply that cost by 5.0, you will obtain a rough estimate of the total installed cost of the plant, including equipment, materials, construction, and engineering.