5A-QA-PL-02Rev00 - Project Execution and Quality Plan

WHITE NILE PETROLEUM OPERATING COMPANY LTD

DOCUMENT NO:

QA-PL-002

OGP TECHNICAL SERVICES SDN BHD SUDAPET LTD Sudapet Ltd.

THAR JATH DEVELOPMENT PROJECT

PROJECT EXECUTION & QUALITY PLAN

REVISION RECORD REV NO. 00

REVISION DESCRIPTION

DATE OF ISSUE

ISSUED FOR PMC IMPLEMENTATION

5/1/2004

Review

OWNER

CONSULTANT

REV NO

Origin.

Engineering

Procurement

Construc- Commisstion ioning

Approval Contract

QA

HSE

Project Control

00

CHECKED BY

DATE:

APPROVED BY

DATE:

PROJECT MANAGER

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DOC. TITLE : PROJECT EXECUTION & QUALITY PLAN

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RECORD OF CHANGE DATE OF PAGE AMENDMENT NUMBER OR RE-ISSUE ISSUED

PAGE REVISION NUMBER REASON FOR CHANGE NO. REPLACED

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TABLE OF CONTENT 1.0PURPOSE AND SCOPE................................................................... ..........................5 2.0OBJECTIVE............................................................................................................ .....5 3.0DEFINITIONS.................................................................................................. ............5 4.0REFERENCE............................................................................... ...............................5 5.0PROJECT DESCRIPTION....................................................................................... ....6 6.0SCOPE OF WORK ..................................................................................... ................6 7.0PROJECT ORGANISATION.......................................................................... ..............6 8.0EXECUTION STAGES............................................................................................... ..6

8.1ENGINEERING..........................................................................................................7 8.1.1General.................................................................................................................7 8.1.2Functional Objectives...........................................................................................7 8.1.3Engineering Practices ..........................................................................................7 8.1.4Resources.............................................................................................................9 8.1.5Sequence Of Activities.........................................................................................9 8.2PROCUREMENT AND MATERIALS MANAGEMENT......................................10 8.2.1General...............................................................................................................10 8.2.2Functional Objectives.........................................................................................10 8.2.3Management Practices........................................................................................11 8.2.4Resources ..........................................................................................................12 8.2.5Sequence Of Activities.......................................................................................12 8.3CONSTRUCTION....................................................................................................14 8.3.1General ..............................................................................................................14 8.3.2Functional Objectives ........................................................................................14 8.3.3Construction Management Practices .................................................................14 8.3.4Resources ..........................................................................................................16 8.3.5Sequence Of Activities ......................................................................................17 8.4COMMISSIONING..................................................................................................17 8.4.1General...............................................................................................................17 8.4.2Functional Objectives ........................................................................................17 8.4.3Commissioning Management Practices ............................................................18 8.4.4Resources ..........................................................................................................19 8.4.5Sequence Of Activities ......................................................................................19 8.5PROJECT PLANNING & CONTROL.....................................................................19 8.5.1General ..............................................................................................................19 8.5.2Functional Objectives ........................................................................................19 8.5.3Work Scope Definition ......................................................................................20 8.5.4Work Breakdown Structure (WBS)....................................................................20 8.5.5Time, Planning And Scheduling ........................................................................20 8.6COST ESTIMATING AND BUDGETTING............................................................23 8.6.1Project Capital Cost Estimation.........................................................................23 8.6.2CONSULTANT’s Project Operating Budget.....................................................23 8.7QUALITY MANAGEMENT ..................................................................................24 8.7.1General ..............................................................................................................24 8.7.2The Process Approach........................................................................................24

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TABLE OF CONTENT

8.7.3QMS Program....................................................................................................24 8.8HEALTH, SAFETY & ENVIRONMENT (HSE).....................................................27 8.8.1General...............................................................................................................27 8.8.2HSE Objectives..................................................................................................27 8.8.3HSE Culture.......................................................................................................27 8.8.4Organisation.......................................................................................................28 8.8.5HSE Committee Organisation............................................................................29 8.8.6Implementation Strategy....................................................................................29 8.9DOCUMENT MANAGEMENT..............................................................................30 8.9.1Hierarchy of Document......................................................................................31 8.9.2Responsibility for Document and Records control ...........................................31 8.9.3Project Final Documentation .............................................................................32 8.10PROJECT COMPLETION MANAGEMENT.......................................................32 8.10.1Mechanical Completion...................................................................................32 8.10.2Initial Acceptance.............................................................................................33 8.10.3Final Acceptance..............................................................................................33 8.11CONSULTANT - OWNER INTERFACE..............................................................33 8.11.1Project Progress Meetings................................................................................33 8.11.2Meetings with OWNER...................................................................................33 8.11.3Meetings with CONTRACTOR.......................................................................33 8.11.4Monthly Status Report......................................................................................33 8.11.5Official Correspondences.................................................................................34 8.11.6Unofficial Daily Communication.....................................................................34

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DOC. TITLE : PROJECT EXECUTION & QUALITY PLAN 1.0

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PURPOSE AND SCOPE This Project Execution and Quality Plan shall generally detail the plan and strategies that CONSULTANT shall undertake in performing CONSULTANT’s scope of works as Project management CONSULTANT for Thar Jath Development Project.

2.0

OBJECTIVE The main objective of this plan is to inform the OWNER on PMC’s execution plan as well as to create awareness among PMC staff on project execution strategies and implementation.

3.0

DEFINITIONS PMC

Project Management CONSULTANT – OGP and Sudapet

OWNER

White Nile Petroleum Operating Company

EPCC

Engineering, Procurement, Construction and Commissioning

PCC

Procurement, Construction and Commissioning

PIM

Project Implementation Manual

Monitoring

To keep track systematically with a target to collecting information.

Verification

To confirm by examination and objective evidence

Materials

For this project the term materials includes any material processed, unprocessed, assembled or fabricated into the equipment or other various devices that may be purchased for the project. The term does not include services purchased in support of the project.

WBS

Work Breakdown Structure

Critical Path A series of activities, which are the longest path in the Project or with the minimum float.

4.0

REFERENCE Project Management Consultancy Services Proposal Document with WNPOC

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PROJECT DESCRIPTION Block 5A is located onshore in southern Sudan approximately 950 km south of Khartoum. Block 5A is within the Muglad Basin which has a number of both existing and planned new developments and covers an area of approximately 7.4 million acres. Contract area for Block 5A is 20,917 sq.km. Raw crude oil from Thar Jath and Mala fields will be collected by buried flowlines and manifold systems leading to the Central Processing Facilities (CPF), where crude oil will be treated for water removal and stabilization and exported through a 173 km pipeline to the existing Heglig Pump Station # 1 for onward export of the crude oil to Port Sudan. In general, Block 5A Oil Development Project comprises the following facilities: Package 1A – Accommodation Complex Package 1B - Rubkona Bridge Package 2 – Central Processing Facilities (CPF) Package 3 – Field Surface Facilities (FSF) Package 4 – Export Pipeline Package 5 – Central Power Plant

6.0

SCOPE OF WORK Details of scope of work for PMC shall be referred to PMC Proposal Document.

7.0

PROJECT ORGANISATION The description of the roles, responsibilities and qualifications required of certain key individuals is given in Attachment 1.

8.0

EXECUTION STAGES As per the scope of work stated in the proposal agreement, the execution plan is broken down into the following disciplines: .a Engineering .b Procurement .c Construction & Pre-commissioning .d Commissioning

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.e Project Planning and Control .f

Quality Management

.g Health, Safety, and Environment .h Document Management .i

8.1

Final Handover

ENGINEERING 8.1.1

General This plan describes and establishes OGP’s engineering practices, resources, and sequence of activities needed to meet project management consulting requirements as described in the CONSULTANT’s PMC contract.

8.1.2

Functional Objectives To ensure successful delivery of CONSULTANT’s engineering services that meet project needs, established requirements and OWNER expectations in terms of time, cost, and quality for the scope of works where engineering services conducted by PMC. To assure OWNER that the CONTRACTORs engineering related work and products are in compliance with the requirement stated in respective contracts in terms of time, cost, and quality. To closely work with other groups within the PMC organization to meet project targets i.e. prompt feedback to procurement, construction and commissioning groups on technical queries, prompt reaction against quality assurance non-compliance and potential non-compliance. 8.1.2.i)

Quality Indicator and Standards Time - Engineering deliverables completed as per planned schedule. Cost - Rework cost not exceeding 1% of the contract value. NCR – No recurrence of NCR’s of the same nature.

8.1.3

Engineering Practices The following practices are appropriate to OGP engineering activities during the project executions.

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Organization This project shall be staffed by qualified engineers as needed for effective monitoring, assessment, and verification of engineering requirement. Responsibility and Authority The engineering manager is responsible to ensure this plan is carried out. Specific engineering responsibility, authority and interrelation of those who monitor, assess or verify performance or results are defined in appropriate procedures or instructions. Resources The engineering manager shall identify the required resources and assign trained personnel to monitor and verify CONTRACTOR performance of engineering works. Monitoring and Verification Monitoring and verification activities to be undertaken are addressed in the procedure Monitoring and Verification of Engineering by OTHERS, EN-PR-001. Design Management Plan For design that is under CONSULTANT’s responsibility, Package 1A and Package 1B, CONSULTANT shall monitor and verify the changes required and updates the document as appropriate. CONSULTANT’s field engineering services shall be deployed to manage the interface between engineering and procurement/construction/commissioning CONTRACTOR. The engineering manager shall ensure that the design management plan meeting requirement stated in the Quality Control of Design Activities EN-PR-002. For design which is under CONTRACTOR’s responsibility, Package 2, Package 3, Package 4, and Package 5, the CONSULTANT’s Engineering Group shall monitor and verify the CONTRACTOR’s design WORKS are developed and implemented meeting the contract requirement. Thereafter, the CONSULTANT’s Engineering Group shall monitor and verify that CONTRACTOR’s performance and results remained compliance with the approved plan. Design Control The CONSULTANT’s Engineering Group shall monitor and verify that design control is established and practiced by both CONSULTANT’s engineers and EPCC CONTRACTORs’ engineers. Document and Data Control The CONSULTANT’s Engineering Group shall achieve and maintain document and data control as required by procedure Document Control,

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QA-PR-001. The group shall also monitor and verify that the required control in managing document and data are achieved and maintained by CONTRACTORs. Procurement The CONSULTANT engineering group shall monitor and verify EPCC CONTRACTOR’s procurement activities including reviewing and recommending approval of evaluation process prior to CONTRACTOR placing a purchase order or requisition. 8.1.4

Resources The resources needed to manage the engineering group during this project are for the most part related to monitoring and verification of CONTRACTOR activities. To accomplish this task requires: )a Trained technical staff with appropriate skills. )b Organizational Freedom and Authority of all verification personnel is established. )c Time (man-hours) to accomplish the work OGP has estimated the skills and man-hours needed and included these factors in PMC contract agreement. Skills are described in appropriate job descriptions and assignment addressed in this document. Man-hours are constrained by the terms expressed in PMC contract. Should substantial changes in the scope of work occur the man-hour requirements might require adjustment and such must be included in any proposed change adjusting the scope of work.

8.1.5

Sequence Of Activities Activities to be performed by the engineering functions shall be integrated into project schedules. The event/activities listed below shall be scheduled and accomplished during the project phase indicated. PHASE 1 - Bid Evaluation a) Technical evaluation criteria b) Commercial evaluation criteria c) Preparation of Tender Estimates d) Clarification of Issues raised by bidders e) Technical evaluation of PCC and EPCC bids f)

Support of commercial bid evaluation

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PHASE 2 - Detailed Engineering and Procurement a) Monitor and verify activities/performance

EPCC

CONTRACTOR’s

engineering

b) Review and approve PCC CONTRACTOR’s shop drawings c) Review and recommend actions regarding technical document submitted by EPCC CONTRACTOR. d) Review and recommend actions regarding proposed technical changes. e) Provide technical information to other functional groups. f)

Ensure execution of HAZOP studies by EPCC CONTRACTOR

g) Monitor and report engineering related construction matters and schedule status or progress

8.2

PROCUREMENT AND MATERIALS MANAGEMENT 8.2.1

General This plan describes the Management Practices, Resources, and Sequence of Activities to be accomplished by CONSULTANT’s procurement and materials management functions as per the requirement of PMC contract. Those activities of the overall project management plan that determine the objectives and responsibilities appropriate to the functions of specifying, purchasing, handling, storage, packaging, preservation and delivery of materials to be included into the completed work

8.2.2

Functional Objectives To assure OWNER that procurement and materials related activities are in compliance with the stated requirement and the materials procured by the CONTRACTOR to meet established requirement for time, cost, and quality. 8.2.2.i)

Quality Indicator and Standards Time – Procured materials delivered at site as per planned schedule. Cost - Rework cost not exceeding 1% of the contract value. NCR – No recurrence of NCR’s of the same nature.

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DOC. TITLE : PROJECT EXECUTION & QUALITY PLAN 8.2.3


Management Practices These practices are appropriate to CONSULTANT’s procurement and materials management activities during this project. Organization This project shall be staffed by qualified procurement and materials management specialist as needed for effective monitoring and verification of the CONTRACTOR’s procurement and material activities, including monitoring and verification of SUPPLIER’s quality. Responsibility and Authority The Procurement & Materials Function Manager is responsible to ensure this plan is carried out. Specific responsibilities, authority and interrelation of those who monitor, assess or verify performance or results are defined in appropriate Project Procedures. Overall Project responsibility and relationships are addressed in Project Execution Plan and authority in individual job descriptions. Resources The Procurement & Materials Functions Manager shall identify resource requirements, provide needed resources and assign trained personnel to monitor and verify CONTRACTOR’s performance including the quality of materials procured by the CONTRACTOR. Monitoring and Verification Monitoring and verification activities to be undertaken are addressed in the procedure Monitoring and Verification of Procurement by OTHERS, PO-PR-001. The Procurement & Materials Functions verification activities shall be defined and documented in appropriate Project Procedure and Work Instruction. Procurement Plan The Procurement & Materials Functions shall monitor and verify the CONTRACTOR has developed and implemented a Procurement Plan, which conforms to appropriate contract requirements. Thereafter, the Procurement & Materials Functions shall monitor and verify the CONTRACTOR performance complies with the approved plan. The procurement plan shall address procedures for purchase specifications and purchasing. The plan shall also provide appropriate procedures/instructions for handling, storage, preservation and delivery of materials. Document and Data Control The Procurement & Materials Functions shall achieve and maintain document and data control as required by Project Procedures and Work

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Instructions. The function shall also monitor and verify that the required VENDOR and SUB-CONTRACTOR provided document and data control is achieved and maintained in compliance with the CONTRACTOR’s procedures as approved by OWNER. 8.2.4

Resources The resources needed to manage the Procurement & Materials Function during this project are for the most part related to monitoring and verification of CONTRACTOR’s activities. To accomplish these tasks effectively requires: a) Trained Technical Staff with skills appropriate to the specific activities. b) Organizational Freedom and Authority of all verification personnel must be clearly established. c) Time (man-hour) to accomplish the work. CONSULTANT has estimated the skills and man-hour needed and included these factors in the PMC contract agreement. Skills are described in appropriate job descriptions and assignment address in Project Plans, Procedures, Work Instructions, etc. Man-hours are constrained by the term expressed in the PMC contract. Should substantial changes in the scope of work occur the man hour requirements may require adjustment and such must be included in any proposed change adjusting the scope of work.

8.2.5

Sequence Of Activities Activities to be performed by the Procurement & Materials Functions shall be integrated into the project schedule. The procurement and materials management activities listed below shall be scheduled and carried out during Detailed Engineering and Procurement. a) Monitor and verify equipment and major purchases. b) Coordinate Engineering review of Comprehensive Evaluations submitted by the CONTRACTOR.

Technical

c) Coordinate with and assist the Quality Assurance Function to carry out;

•

Review and recommend approval of procedures for inspection, expediting, and quality assurance of material at VENDORs shop.

•

Engage third party inspection and expediting agencies.

•

Review or Audit of VENDOR quality assurance activities are carried out as approved by CONSULTANT.

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•


Monitor and verify that CONTRACTOR’s SUPPLIERs quality is adequate to meet stated requirements.

d) Ensure that Comprehensive Technical Evaluations are approved prior to CONTRACTOR placing orders. e) Monitor and advise OWNER on the CONTRACTOR;

)f

•

maximum use of Malaysian resources and SUPPLIERs of materials and equipment.

•

appointment of VENDORs and SUB-CONTRACTOR.

Perform the following tasks and advise OWNER on the CONTRACTOR compliance with approved standards, specifications, and schedules.

•

Monitor and verify procurement activities.

•

Review proposed changes in VENDORs and recommended to OWNER.

•

Ensure CONTRACTOR is carrying out expediting when necessary.

•

Report and recommend actions to correct ANY change that will affect schedule or quality.

•

Assist OWNER’s Operations with spare parts management.

•

Provide assistance with import tax exemptions and customs clearance.

•

If required assist OWNER with direct procurement of items operation.

•

Monitor and verify that the CONTRACTOR adheres to all requirements imposed by authorities.

•

Ensure that ownership and title of purchased items is vested in OWNER no later than their arrival to site.

•

Report to OWNER monthly on procurement schedule and quality

)g Coordinate with the Project Controls Function to carry out

•

Review of Procurement Schedule compatibility with Project Schedule.

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•

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Analyses of quoted delivery dates for compatibility, schedule adherence, and ability to meet the construction schedule.

)h Coordinate with the Engineering Function to carry out

)i

8.3

•

Review of comprehensive recommend to OWNER.

•

Witness shop test of equipment.

•

Identifying long-term spares, consumable spares, lubricants and lab equipment.

technical

evaluations

and

Coordinate and assist Construction and Commissioning to

•

Monitor and verify that goods received at site are inspected, identified and catalogued, properly stored and maintained by the CONTRACTOR.

•

Ensure adequacy of spare parts and process consumable items are purchased for commissioning.

CONSTRUCTION 8.3.1

General This section describes and establishes CONSULTANT’s Construction Management practises, resources and sequence of activities needed to meet project management consulting requirements as described in the PMC Contract.

8.3.2

Functional Objectives To monitor and verify that the project is built in accordance to the schedule project standards, specifications, and other requirements in EPCC contract agreement and advise OWNER on the performance of EPCC CONTRACTOR. 8.3.2.i)

Quality Indicator and Standards Time – Construction progressed as per planned schedule. Cost - Rework cost not exceeding 1% of the contract value. NCR – No recurrence of NCR’s of the same nature.

8.3.3

Construction Management Practices These practices are appropriate to CONSULTANT’s construction management activities during this project.

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Organization Qualified personnel as needed for effective monitoring, assessment, and advising OWNER on matters related to project management should staff this project. Functional organization charts for project phases are to be issued by Project Manager initially and thereafter when changes are made.

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Responsibility and Authority The Project Manager is to ensure this Plan is carried out. Resources The Project Manager shall identify resources requirements, provide needed resources as agreed by OWNER and assigned trained personnel to monitor and verify CONTRACTOR’s performance of construction work. Monitoring and Verification Monitoring and verification activities to be undertaken are addressed in the procedure Monitoring and Verification of Construction by OTHERS, CO-PR-001. Verification by qualified and trained engineers is the primary means, by which CONSULTANT measures and assesses performance and results. Construction verification activities shall be documented in appropriate project surveillance format. Quality Plan CONTRACTOR shall submit a detail Quality Plan for the construction phase for approval by OWNER or OWNER’s Representatives. This Plan shall address inspections, tests and other quality related activities to be carried out by the CONTRACTOR. After OWNER approval of the Quality Plan, CONSULTANT shall monitor and verify the CONTRACTOR’s compliance to the approved Quality Plan. Document and Data Control The Construction Function shall achieve and maintained document and data control as required by project procedures. The function shall also monitor and verify that required documents and data control is achieved and maintained by CONTRACTOR. 8.3.4

Resources The resources needed to monitor and advise OWNER on construction matters during this project are related to monitoring and verification of CONTRACTOR activities. To accomplish these tasks effectively requires: a) Trained technical staff with skills appropriate to specific activities. b) Organization freedom and authority of all verification personnel must be clearly established. c) Time (man-hour) to accomplish the work. CONSULTANT has estimated the skills and man-hours needed and included these factors in the PMC contract agreement. Skills are

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described in appropriate job description and assignment addressed in Project Plan, Procedures, Work Instruction, etc. For site staff a fixed daily charge rate shall be applied. Estimate duration of each site staff will be provided. Man-hours are constrained by the term expressed in the PMC CONTRACT. Should substantial changes in the scope of work occur, the man hour requirement may require adjustment and such must be included in any proposed change adjusting the scope of work. 8.3.5

Sequence Of Activities Activities to be carried out by the Construction function and appropriate phases of the WORK i.e. Base Work and Optional Work are describe in the PMC scope of work and include the following areas of activity in Engineering, Procurement, Construction and Commissioning. a) Monitor and verify CONTRACTORs’ construction and quality activities as described in the PMC contract. b) Review and recommend action regarding plans and procedures submitted by the EPCC CONTRACTOR. When approved, monitor and verify CONTRACTOR compliance with these documents. c) Review and recommend actions regarding proposed changes. d) Monitor and report construction related cost and schedule status/progress. e) Support the Commissioning and Operation Functions as needed. f)

8.4

Prepare a construction closeout report.

COMMISSIONING 8.4.1

General This section describes and establishes CONSULTANT’s commissioning management practices; resources and sequence of activities need to meet project management consulting as described in the PMC contract.

8.4.2

Functional Objectives To monitor and verify CONTRACTOR’s commissioning activities in order to advise OWNER that these activities are being implemented incompliance with safety and environmental requirements, schedules, approved procedures and other requirements of the contract agreement. 8.4.2.i)

Quality Indicator and Standards Time – Commissioning progressed as per planned schedule.

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Cost - Rework cost not exceeding 1% of the contract value. NCR – No recurrence of NCR’s of the same nature. 8.4.3

Commissioning Management Practices These practices are appropriate to CONSULTANT commissioning management activities during this project. Organization This project shall be staffed qualified specialists as needed for effective monitoring, assessment and advising OWNER on matters related to project Commissioning Manager initially and thereafter when changes are made. Responsibility and Authority The Commissioning Function Manager is responsible to ensure this plan is carried out. Specific responsibilities, authority and interrelation of those who monitor, assess or verify performance or results are defined in appropriate Project Procedures or Work Instructions. Overall Project responsibility and relationships including the authority of each individual i.e. job descriptions are addressed in Attachment 1. Monitoring and Verification Monitoring and verification activities to be undertaken are addressed in the procedure Monitoring and Verification of Commissioning by OTHERS, CM-PR-001. Verification by qualified and trained specialist and Engineer is the primary means by which CONSULTANT measures and assesses, performance and results. Commissioning verification activities shall be defined and documented in appropriate project procedure and work instruction. Commissioning Plan and Procedures The Commissioning Function shall monitor and verify that the CONTRACTOR has developed comprehensive written and schematic procedures, which include start-up and shutdown procedures, performance test and turnover procedures. These documents require OWNER comment and approval. The commissioning function shall monitor and verify that the CONTRACTOR’s performance and results remain in compliance with these documents. Document and Data Control The commissioning functions shall achieve and maintain document and data control as required by Project Procedures and Work Instructions. The function shall also monitor and verify that required document and data control is achieved and maintained by the CONTRACTOR. The requirements, activities, and responsibilities appropriate to document

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and data control are address in procedure Document Control QA-PR01. 8.4.4

Resources The Commissioning Manager shall identify resource requirements, provide needed resources and assign trained personnel to monitor and verify CONTRACTOR’s performance of the commissioning work. The resources needed to monitor and advise OWNER on commissioning matters during the commissioning phase of this project are for the most part related to monitoring and verification of CONTRACTOR’s activities. To accomplish these tasks effectively requires trained technical staff with skills appropriate to the specific activities. Time (man-hour) to accomplish the work. CONSULTANT has estimated the skills and man-hour needed and included these factors in the PMC contract agreement. Skills are described in appropriate job descriptions and assignment address in project plans, procedures, work instructions, etc. Man-hours are constrained by the term expressed in the PMC contract. Should substantial changes in the scope of work occur the man hour requirements may require adjustment and such must be included in any proposed change adjusting the scope of work.

8.4.5

Sequence Of Activities The CONTRACTOR shall prepare a detailed schedule for the commissioning time frame together with a VENDOR support schedule. Both of these documents are too reviewed and approved by OWNER.

8.5

PROJECT PLANNING & CONTROL 8.5.1

General This section shall provide the plan and strategies in Planning and Scheduling of works in this project. This procedure covers the initial activities during the Planning phase of the Project.

8.5.2

Functional Objectives Project Planning and Control activities is aimed at monitoring and verifying overall project progress in terms of time and cost to ensure compliance to master schedule and budgeted cost. 8.5.2.i)

Quality Indicator and Standards Time – Project progress meets the planned completion dates for phases in engineering, procurement, construction and commissioning. Cost - Overall cost not exceeding 1% of the contract value.

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DOC. TITLE : PROJECT EXECUTION & QUALITY PLAN 8.5.3


Work Scope Definition A Work Strategy shall be formulated by CONSULTANT to outline the implementation strategy that would be the best for the Project. The main output during this phase are: a) Work Breakdown Structure b) This Project Execution Plan c) PMC Services Proposal

8.5.4

Work Breakdown Structure (WBS) CONSULTANT shall develop the first and second level WBS that shall hierarchically breakdown the Project into smaller, more manageable and well-defined components to enhance the planning, organization, and controls of the implementation and reporting of the Project activities. The detail WBS shall be developed by PCC/EPCC CONTRACTOR and will be approved by OWNER. The First and second level WBS shall be approved by the CONSULTANT’s Project Director and the OWNER’s Project Manager within 1 month after the Project Start Date. The approved WBS shall then be compiled in the Project Implementation Manual for reference and guideline for all Project activities.

8.5.5

Time, Planning And Scheduling Time scheduling of the Project shall be addressed by the following deliverables will be developed: a) Master Project Schedule b) Engineering Work Schedule (Level-2) c) Procurement Work Schedule (Level-2) d) Construction Work Schedule (Level-2) e) Commissioning Work Schedule (Level-2) A Project Schedule Report that provides narrative explanations to the implementation strategy and sufficient details to describe the scheduling basis and assumptions made may also accompany the above schedules. The development of these schedules is more precisely detailed in the following paragraphs

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DOC. TITLE : PROJECT EXECUTION & QUALITY PLAN 8.5.5.i)


Master Project Schedule CONSULTANT shall develop the Master Project Schedule with thorough considerations to the following Project parameters: a) Scope of Work as defined in the Contract b) Scheduling objectives and constraints c) Financial objectives d) Quality objectives The Master Project Schedule shall document sufficient level of scheduling details to reflect the overall implementation and strategy in undertaking the Project from the start until completion. The Schedule shall reflect the expected Critical Path of the Project and shall be accompanied by an analysis of the criticality. A method statement to address on the foreseeable challenges facing the critical activities that will potentially affect the whole Project execution shall also be provided. The Master Project Schedule shall be approved within 1 month after the Project Start Date by the following authorities unless otherwise agreed in the project requirements: a) OGP Project Manager, b) OGP Project Director and, c) The OWNER’s Project Manager; The approved Master Project Schedule shall then be compiled in the Project Implementation Manual to serve as the Baseline Schedule for all Project activities. A sample of Schedule Basis Memorandum with Master Project Schedule is attached at the end of this procedure (Attachment 1).

8.5.5.ii) Engineering Work Schedule The EPCC CONTRACTOR is responsible to develop the Level-2 Engineering Work Schedule shall be developed to plan the available resources to accomplish the required Scope of Work as normally outlined in the Contract as the List of Engineering Deliverables. For Package 1A and 1B, where CONSULTANT has executed the engineering, no Engineering Work Schedule is required.

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In Level 2 Engineering Work Schedule, a method statement to address on the foreseeable challenges facing the critical activities during this phase should also be provided. CONSULTANT shall review and approve the work schedule. 8.5.5.iii) Procurement Work Schedule The PCC/EPCC CONTRACTOR is responsible to develop the Level-2 Procurement Work Schedule shall be developed to plan the Procurement activities to accomplish the required Scope of Work i.e. to procure the designated list of equipment and materials within the allocated time frame as dictated by the Master Project Schedule. This Schedule shall highlight on major Procurement packages and the critical Procurement milestones. Correct timing references with Engineering, Construction and other Project activities shall also be reflected in this schedule. A method statement to address on the foreseeable challenges facing the critical activities during this phase should also be provided. CONSULTANT shall review and approve the work schedule submitted by PCC/EPCC CONTRACTOR. 8.5.5.iv) Construction Work Schedule The PCC/EPCC CONTRACTOR is responsible to develop the Level-2 Construction Work Schedule to plan the available resources to accomplish the required Scope of Work i.e. to construct the facilities and install the designated list of equipment and materials. The Construction Work Schedule shall then be further developed to document sufficient level of details down to Level 4 to reflect the implementation plan to meet the Project objectives and constraints. The Schedule shall highlight on the critical activities during this phase. A method statement to address on the foreseeable challenges facing the critical activities during this phase that will potentially affect the other aspects of the Project shall also be provided. CONSULTANT shall review and approve the work schedule. 8.5.5.v) Commissioning Work Schedule The PCC/EPCC CONTRACTOR is responsible to develop the Level 2 Commissioning Work Schedule to plan the available resources to commissioning the facilities.

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The Commissioning Work Schedule shall document sufficient details to reflect the overall implementation strategy to meet the Project objectives and constraints The Schedule shall highlight on the critical activities and milestones during this phase. CONSULTANT shall review and approve the work schedule.

8.6

COST ESTIMATING AND BUDGETTING This section of the procedure addresses on the Cost Estimating and Budgeting for the Project where by the main deliverables are: a. OWNER’s Capital Cost Estimation b. CONSULTANT’s Project Operating Budget 8.6.1

Project Capital Cost Estimation CONSULTANT shall develop the Cost Estimates for the Project Capital Cost to the accuracy as required by the OWNER and submitted to OWNER. A Project Costing Report that provides narrative explanations to the basis and assumptions made shall accompany the above Cost Estimate. The approved Project Capital Cost Estimation shall then be submitted for OWNER’s review and records.

8.6.2

CONSULTANT’s Project Operating Budget The CONSULTANT’s Operating Budget shall document sufficient level of breakdown to reflect the financing plan in undertaking the Project from the start until completion. The following authorities shall approves the Project Overall Budget within four weeks after the Project Award Date unless otherwise agreed in the project requirements: a) OGP Project Manager, b) OGP Project Director and c) The OWNER’s Project Manager. The approved budget shall serve as the Baseline Cost Plan throughout the Project duration.

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QUALITY MANAGEMENT 8.7.1

General CONSULTANT is committed to establish, document, implement, and maintain the project quality management system (QMS) and continually improve its effectiveness in accordance with ISO 9001:2000 standards. CONSULTANT shall undertake the following efforts: •

To identify and map all product and functional core business processes and critical supporting work processes. This shall include determining the sequence and interaction of these processes. This is shown in Figure 1

•

To determine criteria and methods needed to ensure that both the operation and control of these processes are effective.

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To ensure the resources availability and the necessity of information in supporting the operation, as well as, monitoring these processes.

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To monitor, measure and analyze the processes.

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To implement actions necessary to achieve planned results and continual improvement of these processes.

CONSULTANT shall identify appropriate individuals, appoint special task forces, and obtain necessary external assistance or other suitable means to help CONSULTANT undertaking the above efforts. 8.7.2

The Process Approach CONSULTANT’s QMS is based on the management of its core processes and system, which have a direct impact to the product and service offered. This is achieved by defining the processes and measurement system and how the organization personnel, equipment and technical expertise shall be managed to ensure that the customers and interested parties agreed expectations and requirements are met. The CONSULTANT Business Process shall conform to process approach of the ISO9001: 2000 QMS.

8.7.3

QMS Program In essence, CONSULTANT QMS program shall cover all phases of the project namely: basic engineering, detail engineering, ITB preparation, procurement, construction and commissioning. The program is divided into 3 categories: Quality Planning

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Quality Planning is a process to identify which quality standards or requirement are relevant to the project and determining ways and methods to satisfy them. The quality planning shall include the following activities:

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Establish Project Quality Policy

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Establish a specific Project Quality Manual, QA-PL-001 that will show how the requirement of ISO9001: 2000 is met by the project QMS.

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Establish Project Execution Plan

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Support functional groups to establish each group’s objectives.

Quality Assurance Quality Assurance is a process to establish and to reinforce project quality standards or requirement and to measure and analyze the effectiveness of the project execution in satisfying the established quality standards or requirement. The process shall also identify opportunities for continual improvement in the project. The activities shall include:

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Establish Quality Assurance Procedures

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Establish Quality Assurance Specifications

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Support other project functional group to establish procedures

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Conduct QA/QC audits on internal CONSULTANT’s organization (Refer to QA-PR-005, Project Audits).

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Conduct QA/QC audits on SUPPLIERs and PCC CONTRACTORs (Refer to QA-PR-005, Project Audits).

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Manage issuance / maintenance of audit reports for all project audits (Refer to QA-PR-005, Project Audits).

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Manage issuance / maintenance of non-conformance reports (Refer to QA-PR-006, Control of CONSULTANT’s Nonconformance and QA-PR-007, Control of CONTRACTOR’s Nonconformance, QA-PR-008).

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Manage issuance / maintenance of preventive action reports (Refer to QA-PR-004, Control of Potential Non-conformance)

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Manage customer complaint reports.

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Conduct Contract Compliance Verification on CONSULTANT’s organization.

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•

Establish specific Quality Assurance Procedures for engineering, procurement, construction and commissioning activities.

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Support other construction and commissioning group to establish construction and commissioning procedures

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Review SUPPLIERs’ procedures

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Coordinate Technical Audits

and

PCC/EPCC

CONTRACTORs’

Quality Control Quality Control is a process to measure and analyze project results from specific operational activities using specialized operational monitoring and verification tools and techniques to determine if the results in compliance to established quality standards or requirement. This process shall also include identification and elimination of nonconforming products and identifying ways to eliminate the causes of non-conformances. The quality control activities shall include the following:

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Conduct general surveillance on engineering deliverables

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Conduct required inspection manufacturing/fabrication facilities

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Lead specific data analysis works for quality improvement

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Conduct third party inspection verification

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Conduct general surveillance on construction and commissioning activities

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Witness and approve Welding Procedure / Welder qualification

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Witness and approve validation other special construction and commissioning work processes

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Monitor construction process traceability

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Monitor punch list program

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Conduct verification on mechanical completion and commissioning completion readiness

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Lead specific data analysis works for quality improvement

•

Final Documentation

at

SUPPLIERs’

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HEALTH, SAFETY & ENVIRONMENT (HSE) 8.8.1

General CONSULTANT is committed to implement a systematic HSE management system (HSEMS) that shall ensure a safe and secured project execution. HSEMS shall be established in order to achieve and accomplish safe and secured project execution throughout the CONSULTANT’s scope of works. The HSEMS is defined as the policies, objectives, organizational structure, responsibilities, standards, practices, procedures, processes, controls and resources for implementing HSE management within the business activities.

8.8.2

HSE Objectives The objectives of the HSEMS are to ensure that: a) The health, safety and environmental hazards and effects inherent in the business operations have been systematically identified, b) Arrangements are in place to control those hazards and effects and to deal with the consequences should the need arise, c) The necessary information, training, auditing and improvement processes are in place to achieve these objectives. In other words, the HSEMS is to ensure the reduction of risks within the business operations and management through the effective implementation of the contents of the system and thus providing a safe work environment for all employees either they are direct employees or CONTRACTORs’/SUB-CONTRACTORs’ employees. 8.8.2.i)

Quality Indicator and Standards Time - Engineering deliverables completed as per planned schedule. Cost - Rework cost not exceeding 5% of the contract value. NCR – No recurrence of NCR’s of the same nature.

In order to emphasize the implementation of HSEMS in the project a specific HSE Plan, SF-PL-001, shall be developed to specify requirements of HSEMS to be adhered by the project community. 8.8.3

HSE Culture 8.8.3.i)

This section addresses the management and company’s commitment to sustain a culture that ensures the success of the HSEMS.

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8.8.3.ii) These requirements apply to all leading personnel who provide the leadership, commitment and guidance for the successful implementation of HSEMS. 8.8.3.iii) Management shall provide visible leadership and commitment to the HSEMS. 8.8.3.iv) Management shall provide the necessary resources and support to facilitate adherence of the HSE Policy and the implementation of strategic objective requirements. 8.8.3.v) A company culture that supports the HSEMS shall be characterised by: •

Belief in the company’s intention to improve and maintain its HSE performance at a required level for effective HSEMS implementation.

•

Motivation to improve personal HSE performance based on positive recognition, desirable attitudes and acceptance of individual responsibility.

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Participation of staff at all levels by encouraging their involvement and incorporating their input in HSEMS development, and continually seeking and supporting their suggestions for improvement.

•

Commitment of staff at all levels is essential to have a successful, effective consistent implementation and maintenance of the HSEMS.

8.8.3.vi) The HSEMS Engineer shall monitor any inconsistencies or lack of management leadership within the company, and provide improvement measures as necessary. 8.8.4

Organisation Implementation of HSEMS by CONSULTANT in the project involves three areas of the organisation: The Project Overall organisation, the project site organisation and the HSE Committee organisation. 8.8.4.i)

Central Management Organisation The organization structure shown in Attachment 1 depicts the CONSULTANT’s Project Overall organization, including functional areas and management roles. The Project Overall organization has overall responsibility and accountability for managing HSE in CONSULTANT’s activities. Inherent in each of the roles in the business structure is the responsibility and accountability for implementing the HSEMS within their area of authority. These responsibilities are further described in this section.

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Within the Project Overall structure is the Quality and HSE department. This department reports directly to the Project Manager to ensure autonomy and a direct communication path to senior management for quality and HSE related matters. The Quality and HSE department is facilitator and a resource for the organisation in implementing the HSEMS. 8.8.4.ii) Project Site Organisation The project site organization has the responsibility and accountability for managing HSE at project site. Similar to the Project Overall structure, each of the roles in the project organization has the responsibility and accountability for implementing the HSEMS within their area of authority, and these are described in this section. The respective Site Managers shall be responsible for defining the HSE roles and responsibilities of positions at construction sites that are not provided in the HSEMS Plan. 8.8.5

HSE Committee Organisation The Project HSE Committee shall have the mixture of all parties involved in the project i.e. the OWNER, the CONSULTANT, and SubCONTRACTORs. The objectives of the HSE Committee are as follows:

8.8.6

•

Provide a safe and healthy workplace

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Foster co-operation and consultation between management and workers in identifying, evaluating and controlling hazards

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Provide a channel of communication to exchange ideas, problem solving and feedback

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All levels of management and supervision personnel shall commit fully to their HSE responsibilities to ensure the success of HSEMS.

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Principal accountabilities shall include the general HSE strategic objectives and others developed for individual positions in the organisation charts to meet agreed HSE targets.

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All employees of CONSULTANT need to understand that they have a duty and responsibility to stop work that is being attempted in an unsafe manner, and to advise the senior manager immediately where and why this has been done.

Implementation Strategy CONSULTANT’s Strategic Objectives associated with Implementation are: 8.8.6.i)

Roles and Responsibilities of each individual in Projects. Management shall ensure that all employees are provided with a written description of their roles and responsibilities with respect to the HSE management system and have the

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necessary knowledge and skills to perform their current jobs safely. 8.8.6.ii) Monitoring and Verification of HSE performance by CONSULTANT and EPCC CONTRACTOR. Safety performance will be monitored in a consistent manner across project teams to track HSE performance within the organisation. This requirement shall be extended to EPCC CONTRACTORs where CONSULTANT’s role shall be to continuously monitor the performance and make periodic verifications to ensure the HSEMS requirement is met. 8.8.6.iii) Communication and Training of Safety. The Management from CONSULTANT’s side or EPCC CONTRACTOR shall ensure all employees are aware of the standards of the HSEMS to be used, through communication and training at all levels and all locations of works. Apart from CONSULTANT’s HSE Plan, EPCC CONTRACTOR shall be required to provide their own HSE Plans to define strategies, rules and requirement in the implementation of HSE in each package. 8.8.6.iv) All CONTRACTORs will be subject to assessment and prequalification prior to contract award. CONTRACTORs shall demonstrate compliance and commitment to the CONSULTANT’s HSEMS, as a minimum. 8.8.6.v) Management shall ensure that open and effective communication channels are maintained between the employees, the OWNER, the local community, and CONTRACTORs to ensure that HSE concerns of all parties are responsibly addressed. 8.8.6.vi) CONSULTANT shall continuously improve its HSE performance through adoption of audit recommendations, management review comments and feedback from the workforce, OWNER and CONTRACTORs via well-established communication channels. 8.8.6.vii) Outstanding HSE performance by OWNERs, employees and CONTRACTORs shall be recognised. 8.8.6.viii)Incidents that result in actual losses, including potentially serious near misses, will be reported investigated and analysed in a consistent manner. Corrective actions arising from investigations will be reviewed by Management and recommendations for implementation issued.

8.9

DOCUMENT MANAGEMENT Document Controller (DC) shall control all project documents and records. A dedicated document room shall be furnished to ensure effective document and records management of the project. CONSULTANT has established the

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mandatory QMS procedures Document Control, QA-PR-001 and Control of Project Records, QA-PR-003 to specify the management requirement for the Document and Records control of project. For detail methods on filing of document and records, procedure Project Document Filing System, PM-PR-001 is established. All document and records shall be established and identified by unique numbering. The procedure Document Numbering System PM-PR-002 is established to define rules to number a document or record. 8.9.1

Hierarchy of Document In case of conflict between the requirements of any of the above documents, the following order of precedence will apply: a) The requirements of contract between WNPOC and OGP for the supply of Consultancy services. b) The requirements of the Project Implementation Manual. c) The requirements of the Functional area plans, guidelines and procedures. Responsibility for the resolution of all conflicts between project quality system documents rests with the Project Manager.

8.9.2

Responsibility for Document and Records control Document Controller •

Maintaining master list of control document.

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Distributing controlled document whether in-process or approved ones.

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Receive and distribute correspondence and maintaining the database of correspondence.

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Maintain all original project records and distribute copies.

Functional Department •

Document & records content

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Document & records numbering

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Maintaining of database(s) of documents including; completion, milestones (planned and forecast/actual)

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Reports from database(s) showing only the responsibility of the functional group

Quality Assurance •

Monitoring the process of producing documents

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•

Specifying format of document and records

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Monitoring effectiveness of document reviews and approvals whether it is CONSULTANT’s or CONTRACTORs’

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Conducting audits and surveillances

Project Control

8.9.3

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Development of project control databases

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Identification of trends and variances against the planned dates

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Ensure variances are resolved or accepted and planned dates are amended if required and re-approved.

Project Final Documentation The Project Manager shall have overall responsibility to ensure that final project documentation and quality records are fully monitored by CONSULTANT's project team, to ensure the documentation shall fully describe and demonstrate the quality of work performed in engineering, procurement, construction and commissioning. Responsibility rests with functional managers to ensure project documentation and quality records in their individual functional area are compiled in an organized manner, and ensure all documentation demonstrates compliance with applicable standards.

8.10

PROJECT COMPLETION MANAGEMENT 8.10.1

Mechanical Completion CONSULTANT shall form a specialized monitoring team to verify CONTRACTOR’s Mechanical Completion. This team, which normally led by Construction/Commissioning Manager, shall conduct the following activities: •

Coordinating documentation of punch list

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Coordinating punch list clearance

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Identifying actions to resolve any punch list issues

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Reviewing Mechanical Completion checklist

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Updating Mechanical Completion checklist

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Reviewing Submission of Mechanical Completion Dossiers

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Recommend to OWNER the Approval of Mechanical Completion for CONTRACTORs

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Project QA/QC Engineer shall play his inspection and surveillance role in making sure the correctness and completeness of the CONSULTANT’s produced document and CONTRACTORs’ submitted document. 8.10.2

Initial Acceptance CONSULTANT’s commissioning team shall conduct monitoring and verification of start-up activities until the stable operation of the plant. The Initial Acceptance Dossiers shall be prepared by CONTRACTOR and submitted to OWNER for review and approval. Upon approval of the dossiers and completion of physical works, the team shall recommend Initial Acceptance of the project and the handover of the plant from CONTRACTOR to OWNER.

8.10.3

Final Acceptance CONSULTANT shall monitor the clearance of all punch lists from Initial Acceptance stage and ensure the completion of Project Handover Dossiers prior to recommending Final Acceptance of the project to OWNER.

8.11

CONSULTANT - OWNER INTERFACE 8.11.1

Project Progress Meetings The Project Manager will chair weekly Project Progress Meetings. The purpose of these meetings is to review the status/progress of all project activities including activities, identify any major problems or concerns, assign action items and set a schedule for resolving such problems or concerns. All the respective managers as well as Lead Discipline Engineers shall attend these meetings.

8.11.2

Meetings with OWNER The Project Manager will schedule and chair monthly meetings with the OWNER as necessary. The Engineering Manager, Project Control Manager, Procurement Manager and all Lead Discipline Engineers attend these meetings. They are held to provide the OWNER with a general status of the Project and to obtain his feedback.

8.11.3

Meetings with CONTRACTOR CONTRACTOR’s Project Manager shall chair the meetings with OWNER. CONSULTANT shall represent OWNER during discussion or negotiation with CONTRACTOR and also the decision-making in the meeting. OWNER may also be present in the meeting.

8.11.4

Monthly Status Report The Engineering Manager is responsible for preparing the engineering section of the Monthly Report. He is also responsible for assembling

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the supporting documents and supplying necessary information using the Engineering Management System. 8.11.5

Official Correspondences The procedure Communication & Correspondence Control, PM-PR-004 specifies the procedure for official written communication between CONSULTANT and Contractor.

8.11.6

Unofficial Daily Communication Any informal discussion, negotiation, decision-making with OWNER or CONTRACTOR will not be valid unless written documentation is generated to record such communication has occurred between CONSULTANT - OWNER or CONSULTANT - CONTRACTOR.

5A-QA-PL-02Rev00 - Project Execution and Quality Plan

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