Background
Victoria Chemicals was a leading producer of polypropylene. It supplies to customers of Europe and the Middle East. In addition to numerous small producers, there are seven major competitors within its market region. Victoria Chemicals produce polypropylene at Merseyside Works and in Rotterdam, Holland. The production process in Merseyside Works was old, semicontinuous at best, and need higher labour force compare to its competitors. Since the earning of Victoria Chemicals has dropped from 250 pence per share to 180 pence per share in the financial year of 2007. Pressures from investors have pushed Victoria Chemicals to improve its financial performance. Morris, the plant manager of Victoria Chemicals’ Merseyside Works in Liverpool, England, believed it’s the time to propose the capital project to senior management. This project focus on the renovation and rationalization the polypropylene production line at the Merseyside plant with the cost of GBP12 million, which could help to make up for deferred maintenance and to exploit opportunities to achieve increased production efficiency.
Evaluation Method
For implementing this program, there are two areas of improvements could be discovered. Firstly, deferral of maintenance in order to enhance Merseyside Works’ operates results. Secondly, correcting the antiquated plant design for saving energy and improving
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Introduction

The following report shows that the proposal of the modernisation project should obtain funding from the corporate headquarters of Victoria Chemicals.

The project has an initial outlay of GBP12 million to renovate and rationalise the polypropylene production line at Merseyside plant. This is done in order to make up for deferred maintenance and exploit opportunities to achieve increased efficiency.

This report