May 27, 2008

Our cost estimates are within the right ballpark!

As I mentioned in the OTC trip report, there is a huge amount of uncertainty in our cost estimates, because we aren’t sure how the expense of a seastead will compare to that of an oil platform.  Since we believe that the success of seasteading hinges on whether it can be done at a reasonable price, this will be one of our key areas of research this year.  Here is some evidence that Andy House’s initial ballpark estimate of about $300/ft^2 for his Baystead and Seastead Lite designs is not unreasonable:

The Atlantis Garrison: A Comprehensive, Cost Effective Cargo and Port Security Strategy

Strategic Insights, Volume IV, Issue 4 (April 2005)

This essay proposes a solution to U.S. cargo and port inspection and security problems through the construction and use of offshore ports to screen, inspect, and transfer cargo for delivery inside the United States. Such a system would use offshore platform technologies, called pneumatically stabilized platforms, to provide large acreage ports that would be more cost effective to maintain and more efficient to screen inbound ships and inspect and transfer cargo than alternatives—such as overhauling the current ports systems at home and abroad. Offshore ports are proposed as a critical link into a port and cargo security defense-in-depth system involving a cargo security information system, offshore ports, and the current ports system.

Recent offshore platform construction estimates have been competitive with waterfront land values. Each platform’s costs are ultimately determined by its intended sea state environment, the proximity of the port to the construction site, and the variable costs of materials and labor. Higher cost platforms include a full array of intermodal operations, such as a tunnel and airfield for truck, rail, and air operations.

For the purposes of this essay, costs will be estimated for a hypothetical high end platform—on par with a 95-acre, 100-year typhoon-resistant, Asian transfer port that includes platform, anchoring, and top side systems, complete with its own power and water generation systems, plumbing, electrical, HVAC, fire suppression, insurance, front end engineering and development, and operational buildings. The rough order of magnitude in this example is $337 per square foot, or $14.7 million per acre.

Besides the cost estimate being a good data point, this is a business idea worth investigating.  Since they specifically mention pneumatically stabilized platforms, they’re presumably using the technology from Float, Inc., which we also plan to investigate.