FEED

PETROPERU S.A. TALARA REFINERY MODERNIZATION PROJECT FEED-EPC CONTRACTOR IFP

VOLUME 2 PART C – SERVICES & DELIVERABLES - FEED & EPC MASTER JOB SPECIFICATION PAGE 1 OF 1 DATE: 11 DE JULIO DE 2009

PART C – SERVICES AND DELIVERABLES FRONT END ENGINEERING DESIGN - ENGINEERING, PROCUREMENT, AND CONSTRUCTION (FEED & EPC)

Table of Contents 1. Introduction 2. Project Participants 3. General Distinction between FEED and EPC Services, Deliverables, Performance Expectations and Success Factors 4. Project Instructions

International Bidding Process N° PCI-002-2008-OFP/P ETROPERU

PETROPERU, S.A. TALARA REFINERY MODERNIZATION PROJECT FEED-EPC CONTRACTOR IFP

VOLUME 2 PART C – SERVICES AND DELIVERABLES - FEED & EPC MASTER JOB SPECIFICATION PAGE 1 OF 4 DATE: 11 DE JULIO DE 2009

PART C – SERVICES AND DELIVERABLES FEED & EPC 1. Introduction Part C – Services and Deliverables is a section of the MJS for the PETROPERU S.A. Talara Refinery Modernization (TRM) Project FEED-EPC Agreement. It defines the framework of Services and Deliverables expected from the FEEDEPC Contractor. Part C presents a general description of the FEED-EPC Contractor’s roles and responsibilities during the FEED-EPC execution and is supplemented with Annexes C1 – FEED and C2 – EPC, each of which address in a more detailed manner the roles and responsibilities during the reimbursable cost (FEED) and Lump Sum (EPC) phases of the TRM Project. EMPLOYER is depending on the FEED-EPC CONTRACTOR to be conceptualizer, coordinator, optimizer, planner, designer, executer and Commissioning/Start-up/Performance testing CONTRACTOR for the entire TRM Project. Notwithstanding the definitions in Annex C1 – FEED, Annex C2 – EPC, and the Agreement, EMPLOYER lets the FEED-EPC CONTRACTOR to take the decision to organize and efficiently manage/execute the following: •

All FEED obligations/functions necessary to incorporate Licensors Basic Design Packages (BDP) and FEED CONTRACTOR’S internally designed “Open Art” BDPs into an integrated, optimized, cohesive, comprehensive, reliable, CAPEX and OPEX effective, high quality set of FEED phase deliverables including but not limited to complete FEED packages for all units, a +/-10% quality Open Book Estimate (pursuant to rule AACEI RP N° 18R-97 “Cost Estimate Classification System – as applied in Engineering, Procurement, and Construction for the Process Industries”), and a definitive EPC Phase Project Execution Plan (PEP).

•

Responsively develop a mutually acceptable LS Contract Price and Conversion from Reimbursable Cost to Lump Sum through an Open Book Estimate process.

•

Carry out the EPC phase “Date and Price Certain” Agreement and related responsibilities developed and agreed to following the FEED phase in accordance with established international performance standards and best practices.

These principles should be used to guide all FEED-EPC Contractor activities and actions throughout the TRM Project.




2. Project Participants A more detailed description of the principal participants in the TRM Project is presented in Part A – Project Perspective of the MJS. PMC obligations as expressed in the MJS are only relevant as between PETROPERU and the PMC and do not affect in any way the FEED-EPC Contractor’s obligations. An abbreviated summary is included herein for convenience: •

PETROPERU S.A. – named Owner and Employer for the Talara Modernization Project who has formed the EMPLOYER Project Team (PT) consisting of the EMPLOYER Project Manager and his staff responsible for the Project planning, development and execution. Project Management Consultancy Contractor (PMC) – Contractor selected by EMPLOYER to serve as EMPLOYER’s Representative and provide TRM project management support services to the PT as well as TRM project principal representation, consulting and oversight services on behalf of EMPLOYER with relations to the activities and performance of the FEED-EPC CONTRACTOR. Delegated authorities and responsibilities between EMPLOYER and the PMC will be documented in advance and shall be approved by EMPLOYER.

•

FEED-EPC CONTRACTOR – CONTRACTOR selected by EMPLOYER shall fulfill the principal Contractor roles and responsibilities outlined above in Section 1 – Introduction. FEED responsibilities will be conducted on a reimbursable cost – Fixed Fee Mark-Up culminating, among other things, in the development of quality Job Specifications for all Talara Refinery Modernization facilities and a comprehensive and competitively priced Open Book Estimate, supported by a comprehensive Project Execution Plan (PEP). Until Conversion is achieved (Pre-Construction period), detailed engineering and procurement work will proceed on a reimbursable cost basis. Once achieved, subsequent EPC work obligations will be completed on a mutually agreed LS basis and in accordance with a mutually agreed and updated PEP.

•

Licensors – EMPLOYER has selected a set of Licensors of proprietary processes to work collaborate with the FEED-EPC CONTRACTOR in order to provide a fully integrated, cost efficient and environmentally friendly modernization facility for Talara. Said Licensors will cooperate with the FEEDEPC CONTRACTOR and communicate directly on relevant technical matters. In addition, Licensors will provide guides and training for the EMPLOYER’s personnel and performance testing support.

•

Main Automation Sub-Contractor (MAC) – FEED-EPC CONTRACTOR will select and with EMPLOYER approval shall contract a Main Automation SubContractor (MAC) to be in charge of the design, procurement and construction activities of the modernized refinery Processes Control Systems. FEED-EPC CONTRACTOR shall be responsible for coordination with the Licensors and the MAC and shall assist MAC in carrying out its obligations and responsibilities in




an efficient, timely manner. The Licensors shall be expected to fully cooperate with the FEED-EPC Contractor and MAC in these efforts. The MAC will be a subcontractor of the FEED-EPC CONTRACTOR After the project closing out, the MAC and the EMPLOYER with discuss the possibility of entering in a new agreement in order to have operating assistance from the MAC. 3. General Distinction between FEED and EPC Performance Expectations and Success Factors

Services,

Deliverables,

Specific performance expectations for the FEED-EPC CONTRACTOR with regard to the FEED and EPC Phases of the TRM Project are set forth in Annex C1– FEED and Annex C2 – EPC respectively. Before proceeding to the Annexes, the end goals for each of these Phases should be recognized from a more holistic basis. It is EMPLOYER’s intent that at the end of the FEED portion of the FEED-EPC CONTRACTOR’s effort, the facilities for TRM Project be completely defined to where: •

An AACEI Class 2 Open Book Cost Estimate (+/-10% accuracy) can be and has been developed, supported by a quality, comprehensive PEP for the EPC Phase.

•

FEED-EPC CONTRACTOR and EMPLOYER can agree, in the established time, a mutually satisfactory Conversion and proceed without interruption into the LS EPC phase of the project.

•

FEED-EPC CONTRACTOR can, at EMPLOYER’s option, proceed immediately and efficiently into the Pre-Construction transition stage, initiating detailed engineering and procurement activities in accordance with the mutually agreed PEP.

EMPLOYER’s expectations at completion of the EPC Phase of the project, if it proceeds as anticipated with the FEED-EPC CONTRACTOR, include acceptance of a smoothly operating Modern Talara Refinery facility, meeting specified quality standards and operating efficiently and reliably, safely producing desired product quantities/quality, with desired operating flexibility, while meeting CAPEX and OPEX objectives in accordance with the Agreement. Annex C1– FEED and Annex C2 – EPC will provide more extensive definition of the services, deliverables and expectations for the FEED and EPC phases of the project respectively. In spite of the split between the FEED and EPC phases of the project, the FEED-EPC CONTRACTOR is expected to think entirely of these two phases and be prepared to develop the EPC phase in a highly timely and cost effective manner.




4. Project Instructions The following are Project Instructions (PI) for the FEED-EPC CONTRACTOR. These PI’s define a number of administration and communications minimum requirements between EMPLOYER/PMC and the FEED-EPC CONTRACTOR during the course of the project. It is expected that the selected Bidder will use these PI’s as a basis for developing, in an extensive and specific manner, its Coordination Procedures for the TRM Project. For the most part, PI’s are the same for both the FEED and EPC phases of the project, except where otherwise annotated.



VOLUME 2 PROJECT INSTRUCTIONS TO PART C SERVICES AND DELIVERABLES - FEED & EPC MASTER JOB SPECIFICATIONS PAGE 1 OF 1 DATE: JULY 16, 2009

PROJECT INSTRUCTIONS TABLE OF CONTENTS

Tab #

Title

1.

Correspondence

2.

Time Management

3.

Cost Management

4.

Quality Management

5.

Procurement

6.

Material Control

7.

Document Control

8.

Change Control

9.

Project Specificactions

10.

Finance and Insurance

11.

Responsibility for Other Contract

12.

Overall Construction Plan

13.

Site Health, Safety, Security and Environmental

14.

Monthly Progress Reporting

15.

Measurement of Percentage Completion

16.

Mechanical Completion and Facilities Turnover

17.

Models

18.

Compilation of Project Data

19.

Company’s Reviews, Agreements, Approvals & Authorizations

20.

Protection of Proprietary/Confidential Information




1. CORRESPONDENCE

I.

OBJECTIVE This Instruction addresses issuance and distribution requirements for all project related correspondence and communications.

II. GENERAL REQUIREMENTS All Project communications are to be provided in both the Spanish and English language with, in case of conflict, the Spanish version will prevail. Project participant addresses are presented in Exhibit 1-1, while the requirements for EMPLOYER-originated and CONTRACTOR-originated correspondence are detailed in Exhibits 1-2 and 1-3, respectively. (CONTRACTOR shall note that Exhibit 1-3, as presented, displays only a tabulation of those documents it and the Supervised Contractors, vendors, and subcontractors under its control shall produce and issue for the project. Therefore, CONTRACTOR shall submit, at the Agreement Signature, for EMPLOYER’s review and approval, Exhibit 1-3 upgraded to a matrix format and included as Exhibit 1-4.) A. Mail and Email Correspondence 1. CONTRACTOR-originated project correspondence shall be addressed to EMPLOYER’s Project Manager (or Representative at Site appointed by the EMPLOYER) using appropriate alphanumeric sequential numbering systems to identify correspondence. Copies and distribution of said correspondence shall be in accordance with Exhibit 1-4. 2. All EMPLOYER-originated correspondence to CONTRACTOR shall be in accordance with Exhibit 1-2 and addressed to Contractor's Project Manager or Construction Manager. 3. All hardy copy mailings shall use the most time/cost effective class of postal and courier services and shall accommodate, if appropriate, requirements of customs clearance or other applicable considerations. To further expedite delivery, larger mailings (or emails as applicable) shall be subdivided into smaller packages (or files for emails or other electronic transmissions) which shall be clearly identified as components of a larger multiple package (e.g., 1 of 6). 4. Facsimile transmission or emailing of letters and other items may be used when feasible but critical items such as notices, approvals, etc. shall be confirmed by hard copy originals mailed to the party. 5. Alternate means (e.g., air or motor freight) may be employed for those items not purely “correspondence” in nature such as catalogs, manuals, etc. International Bidding Process N° PCI-002-2008-OFP/P ETROPERU



1. CORRESPONDENCE

B. Telephone or Email Communication - Immediate, written confirmation of all queries, agreements, and instructions transmitted via telephone or email shall be mandatory. Should said confirmation require distribution, copies of such written confirmation shall be distributed in accordance with Exhibits 1-1, 1-2, and 1-3. C. Vendor Documents and Data - CONTRACTOR shall note that "Vendor Documents and Data" is defined to include all drawings, specifications, calculations, and other data requiring CONTRACTOR or EMPLOYER approval as produced by Vendors, Sub-Vendors, Supervised Contractors, and subcontractors under CONTRACTOR's control. Distribution by CONTRACTOR of said material shall be consistent with the development status of the information contained, e.g., raw, reviewed, resubmitted, or certified. D. SUPPORTING INFORMATION – CONTRACTOR shall design a system that permits to have electronic copies of all the documents and data generated during the Project execution with the security elements and appropriate access that have to be approved by the EMPLOYER; this system shall be always updated and maintained by the CONTRACTOR, with access to the EMPLOYER or EMPLOYER’s Representative.



VOLUME 2 PROJECT INSTRUCTIONS TO PART C SERVICES AND DELIVERABLES - FEED & EPC MASTER JOB SPECIFICATIONS PAGE 3 OF 20 EXHIBIT 1-1 PAGE 1 of 2 DATE: JULY 10, 2009

1. CORRESPONDENCE EXHIBIT 1-11 PARTICIPANT ADDRESSES EMPLOYER’s Authorized Representatives (Name of EMPLOYER’s Project Manager)

(Street Address) (Mail Address) (Telephone) (Cell Phone) (Fax) (Email Address)

(Name of EMPLOYER’s Representative at Site)


1

EMPLOYER shall insert names of appropriate EMPLOYER’s PT representatives and PMC representatives.




1. CORRESPONDENCE CONTRACTOR’s Authorized Representatives

(Name of CONTRACTOR’s Project Manager)


(Name of CONTRACTOR’s Construction

(Street Address)

Manager)

(Mail Address) (Telephone) (Cell Phone) (Fax) (Email Address)

Other: Additional names, addresses, functions, and organizations will be provided at the Agreement Signature.




1. CORRESPONDENCE

EXHIBIT 1-2 EMPLOYER-ORIGINATED CORRESPONDENCE DOCUMENT DISTRIBUTION

Requirements as to Originator, Number of Copies, etc. to be established.2 A. General B. Contractual C. Job Specification-Initial D. Job Specification-Revisions E. Change Proposal Requests F. Change Authorizations G. Cost Estimates H. Cost Reports I.

Procurement −

Vendor/Subcontractor Acceptability

−

Purchasing

−

Expediting

−

Subcontracting

−

Traffic

−

Spare Parts

J. Progress Reports

2

EMPLOYER shall develop this item prior to Agreement Signature.




1. CORRESPONDENCE

K. Quality Management −

Home Office (NPTA)

−

Shop Inspection

−

Field (Site Inspection)

L. Mechanical Completion and Turnover M. Start-Up




CORRESPONDENCE EXHIBIT 1-3 CONTRACTOR – ORIGINATED CORRESPONDENCE DOCUMENT DISTRIBUTION A.

B.

General

10. Control Estimate/Control Budget

1.

Contractual

11. Cost Forecasts

2.

Contractual Correspondence

12. Cost Control Conference Notes

3.

Job Procedures

13. Change Proposals

4.

Contractor Invoices

14. Change Orders

5.

Code of Accounts

15. Field Change Orders

6.

Insurance

16. Change Order Summary

7.

Conference Notes/Minutes of Meeting (General)

17. Bulk Material Summaries

8.

Follow Up Notes

18. Material Requisition Status (MRS) Report

Supervised Contracts

19. Purchase Order Report (POR)

1.

Correspondence

20. Material/Equipment Status and Expediting Report

2.

Invoices

3.

Conference Notes/Minutes of Meeting

21. Master Subcontracting Plan

C.

Project Control 1.

Monthly Progress Report

2.

Project Schedules

3.

Progress Curves

4.

Staffing and Labor Profiles/Productivity

5.

Earned Value (EV) Weekly Updates

6.

Shutdown Planning Conference Notes

7.

Time Management Effort Appraisals

8.

Monthly Cost Reports (SPCL)

9.

Cost Estimates




CORRESPONDENCE EXHIBIT 1-3 CONTRACTOR – ORIGINATED CORRESPONDENCE DOCUMENT DISTRIBUTION

D.

22. Specification Index

17. Subcontracts

23. Drawing Index

18. Subcontracts (Field)

24. Vendor Print Log

19. Subcontract Log

25. Spare Parts Control Log

20. Subcontract Status (Pre-Award)

26. Overall Construction Plan

21. Subcontract Schedule (Pre- Award)

Procurement

22. Subcontract Invoice/Payment Summaries

1.

Vendor/Subcontractor Correspondence

23. Recommended Spare Parts Summaries

2.

Vendor/Subcontractor Conference and Minutes of Meeting Notes

3.

Vendor/Subcontractor Lists

4.

Material Requisition (MR’s)

5.

Inquiry Documents/Specifications

6.

Inquiry Release

7.

Bids

8.

Bid Tabulations/Recommendations

9.

Purchase Orders/Attachments

E.

Traffic 1.

Freight Forwarding Agent Correspondence

2.

Customs Agent Correspondence

3.

Conference Notes/Minutes of Meetings

4.

Pro Forma Invoice

5.

Vendor's Commercial Invoice and Certificate of Origin

10. Purchase Orders/Attachments (Field) 11. Expediting Reports 12. Project Subcontracting Specifications 13. Subcontract Inquiry Documents 14. Subcontract Inquiry Release 15. Subcontract Bids/Fair Price Estimates 16. Subcontract Bid Tabulations/ Recommendation



VOLUME 2 PROJECT INSTRUCTIONS TO PART C SERVICES AND DELIVERABLES - FEED & EPC MASTER JOB SPECIFICATIONS PAGE 9 OF 20 EXHIBIT 1-3 PAGE 3 OF 12 DATE: JULY 10, 2009

CORRESPONDENCE EXHIBIT 1-3 CONTRACTOR – ORIGINATED CORRESPONDENCE DOCUMENT DISTRIBUTION 6.

Vendor's Packing List

7.

Export Declaration

8.

Consular Certification

9.

Ocean Bill of Lading

a.

Flow Diagrams

10. Ship's or Plane's Manifest

b.

P&ID's

11. Stowage Plan

c.

Maps, Plot Plans, and arrangements

12. Air Waybill

d.

Line Classification Sheets

13. Insurance Declaration

e.

Line or Pump Calculation Sheets

14. Notice of Claim

3. H.

Operating Instructions

Contractor Drawings 1.

2.

General

Mechanical Equipment (Ref. Exit 5-1 for detailed itemization)

15. Overage, Shortage or Damage (OSD) Report a.

Atmospheric Tankage - Appurtenances List

17. Master Voyage Summary Report

b.

Blowers and Fans - Data Sheets

18. Weekly Shipping Schedule

c.

Compressors - Data Sheets

19. Various Communications

d.

Forming, Packaging, and Proportioning Equipment - Data Sheets

16. Container Content List

F.

G.

Quality Management 1.

Engineering Technical Audits

2.

Shop Inspection Reports and Notices, including Non-Conformance Reports and Corrective Action Reports

3.

Field Reports, including Non-Conformance Reports and Corrective Action Reports

Project Data 1.

Project Record Books

2.

Equipment Reference File




CORRESPONDENCE EXHIBIT 1-3 CONTRACTOR – ORIGINATED CORRESPONDENCE DOCUMENT DISTRIBUTION e.

Heaters and Stacks - Data Sheets

f.

Heat Exchange Equipment - Data

g.

Marine Technical Equipment - Data Sheets

Instrumentation Equipment/ Materials (including DCS)

h.

Mechanical Drivers - Data Sheets

a.

Control Panels

i.

Mechanical Handling Equipment - Data Sheets and Conveyor Drawings

b.

Instrument Location Plans

c.

Installation Details

j.

Packaged Process Equipment - All Drawings and Data Sheets

d.

Data Sheets (Ref. Exhibit 5-1 for detailed itemization)

Pressure Vessels - All Drawings/Tray Data Sheets

e.

Installation Distribution

4.

k.

l.

Contractor Drawings

5.

m. Pumps - Data Sheets n.

o.

3.

Data Sheets (Ref. Exhibit 5-1 for detailed itemization)

e.

a. Thermal Insulation Distribution and Details

Separating and Mixing Equipment - Data Sheets Special Plants - All Drawings and Data Sheets

Insulation and Lining Materials

b.

6.

Fireproofing Distribution and Details

Pipe and Piping Materials

p.

Waste Treatment Equipment - Data Sheets

a.

Drawings/Model Cuts

q.

Water Treatment Equipment - Data Sheets

b.

Isometrics

r.

Vacuum Equipment - Data Sheets

Electrical Equipment/Materials a.

One-Line Diagrams and Area Classification

b.

Grounding

c.

Power and Lighting

d.

Electronic Instrument Control Loops and Instrument and Control Circuits





7.

9.

General Engineering Specifications

Material Summary

d.

Pipe Support Details

a.

Atmospheric Tankage

e.

Pipe Support Materials

b.

Blowers, Fans, and Compressors

c.

Forming, Packaging, and Proportioning Equipment

d.

Heaters and Stacks

e.

Heat Exchange Equipment

f.

Marine Technical Equipment

g.

Mechanical Drivers

h.

Mechanical Handling Equipment

i.

Packaged Process Equipment

j.

Pressure Vessels

k.

Pumps

l.

Separate and Mixing Equipment

Painting a.

8.

3.

c.

Paint Distribution

Buildings (Excluding Foundations) a.

Architectural Drawings

b.

Architectural Drawing Details

c.

Plumbing, Heating and Ventilating

Furniture Distribution a.

Structures (All Excluding Buildings)

b.

Structures, Platforms

c.

Steel Details, and Material Summary

d.

Pipeway and Instrument Supports m. Special Plants

10. Foundations a.

Piling and Foundations

b.

Building Foundations

11. Site Development

I.

a.

Paving, Pathways, Roads, etc.

b.

Underground Service Piping

Contractor Specifications 1.

Basic Design Specifications

2.

Construction Specifications





J.

n.

Waste Treatment Equipment

o.

Vacuum Equipment

p.

Electrical Equipment/Materials

q.

Instrumentation Equipment/ Materials

r.

Thermal Insulation and fireproofing Materials

s.

Pipe and Piping Materials

t.

Painting

u.

Buildings (Excluding Foundations)

v.

Structures and Foundations

w.

Site Development

x.

Welding and Thermal Processing

y.

Catalysts, Chemicals, etc.

a.

Dimensions Drawing with Foundation Data

b.

Cross Section with Parts List

c.

Completed Data Sheet

d.

Welding Procedures

e.

Material Specifications

f.

Drawing Index and Distribution

g.

Calculations - Mechanical

h.

Efficiency Data/Curves

i.

Lubricant Data Sheet

j.

Allowable Nozzle Effort Data

k.

Wiring Control Data

l.

Electrical Terminal Design

Vendor Data m. Arrangement and Connections 1.

Atmospheric Tankage n.

2.

a.


b.

Welding Procedures

c.


d.


e.

Erection/Placement Drawings

f.

Shop Details

g.

Field Erected Details

Piping Layout

Blowers, Fans and Compressors




CORRESPONDENCE EXHIBIT 1-3 CONTRACTOR – ORIGINATED CORRESPONDENCE DOCUMENT DISTRIBUTION o.

Dimensions Drawing

d.

Welding Procedures

p.

Lube and Seal Oil Flow Diagram

e.


q.

Seal Assembly

f.


r.

Seal Cross Section

g.

Calculations - Mechanical

s.

Code Certification Documentation

h.


t.

Priced Recommended Spare Parts List (PRSPL)

i.


j.

Wiring and Control Diagram

u.

Operating and Maintenance Instructions k.


v.

Composite Instruction Manual l.

Arrangement Drawings

w.

Shop Details m. Piping and Instrumentation

3.

4.

Forming, Packaging and Proportioning Equipment a.


b.


c.

Wiring and Control Data

d.

Erection Drawings

e.

Operating and Maintenance Instructions

f.

Shop Details

g.


h.


n.

Burner Assembly

o.

Pilot or Ignition Systems

p.

Soot Blowers

q.

Dry Out Procedure

Heaters and Stacks a.


b.

Cross Sections with Parts List

c.






5.

6.

Marine Technical Equipment (Same as Forming, Packaging, and Proportioning Equipment, as applicable)

Shop Details

7.

Mechanical Drivers (Same as Blowers, Fans, and Compressors, as applicable)


8.

Mechanical Handling Equipment (Same as Forming, Packaging, and Proportioning Equipment, as applicable)

9.


r.


s.

Operating and Maintenance

t. u.

Heat Exchange Equipment a.


b.


c.

Completed Data Sheets

d.

Wiring Procedures

e.


f.


g.


h.


i.

Piping and Instrumentation Diagram

j.

Vibration Switch

k.


l.


a.


b.


c.

Operating and Maintenance Instructions with PRSPL

d.

Drawing Index and Schedule

10. Pressure Vessels a.

Vessel Under Pressure Dimensions with Foundation Data

b.

Vessel Welding Procedures

c.

Vessel Calculations – Mechanical

m. Operating and Maintenance Instructions n.

Shop Details

o.

Drawing Index and Details




CORRESPONDENCE EXHIBIT 1-3 CONTRACTOR – ORIGINATED CORRESPONDENCE DOCUMENT DISTRIBUTION d.

Vessel General Assembly and Drawing Index

e.

Vessel Code Certification and Supporting Documentation

f.

Vessel Shop Details

g.

Vessel Mechanical Efforts Program and Data

h.

Tray/Internals Completed Data Sheets

i.

j.

Arrangement/Connection Drawings

k.

Lube and Control Oil Diagram

l.

Gland Sealing Diagram

m. Code Certification and Supporting Documentation n.


Tray/Internals Calculations

o.


j.

Tray/Internals Overall Arrangement

p.

Shop Details

k.

Tray/Internals Arrangement Diagrams and Instructions

l.

Tray/Internals Shipping and Material List

m. Tray/Internals Shop Details n.

Tray/Internals Drawing Index and Distribution

12. Separating and Mixing Equipment (Same as Forming, Packaging, and Proportioning Equipment, as applicable) 13. Special Plants (Same as Packaged Process Equip, supplemented by applicable component requirements) 14. Waste Treatment Equipment (Same as Special Plants)

11. Pumps a.


b.


c.


d.

Wiring Procedures

e.


f.


g.


h.

Lubricant Data Sheet

i.

Allowable Nozzle Efforts Data




CORRESPONDENCE EXHIBIT 1-3 CONTRACTOR – ORIGINATED CORRESPONDENCE DOCUMENT DISTRIBUTION 15. Water Treatment Equipment (Same as Special Plants)

18. Instrumentation Equipment/ Materials (including DCS) a.

Dimensions Drawings with Cutouts and Supports

16. Vacuum Equipment a.

Dimensions Drawings

b.


b.


c.


c.


d.


d.

Material Specification

e.

Calculations and Calibration Curves

e.


f.


f.

Arrangement Drawings

g.

Electrical Terminal Designation

g.

Assembly Diagram

h.

Panel Layout with Major Dimensions

h.


i.

Back Panel Layouts

j.

Typical Panel Cross Section

i.

Operating and Maintenance Instructions k.

Pneumatic Diagrams

j.

Drawing Index and Distribution l.


17. Electrical Equipment/Materials a.


b.


c.


d.


e.

Wiring Diagrams

f.


g.


h.

Shop Details/Pipe Supports




CORRESPONDENCE EXHIBIT 1-3 CONTRACTOR – ORIGINATED CORRESPONDENCE DOCUMENT DISTRIBUTION m. Composite Instruction Manuals

f.

Erection Drawings

n.

Photo Negatives and Prints

g.

Piping and Instrumentation Diagram

o.

Color Samples

h.

Vendor Field Fabricated Items

p.

Shop Details

i.

Shop Details

q.


j.


19. Pipe and Piping Materials a.

Dimension Drawing with Foundation Data

b.

Cross-Sections with Parts List

c.


d.

Welding Procedures

e.


f.


g.

Code Certification and Supporting Documentation

h.


i.


j.

Shop Details/Pipe Supports

21. Structures and Foundations a.


b.


c.

Structural Calculations

d.

Structural Erection Drawings

e.

Structural Shop Details/Pipe Supports

f.

Structural Painting Specification

g.

Foundation Erection/Placement Drawings

h.

Foundation Reinforcing Cutting/Bending List

20. Buildings (Ex Foundations) a.


b.


c.

Calculations - Structural

d.


e.





CORRESPONDENCE EXHIBIT 1-3 CONTRACTOR – ORIGINATED CORRESPONDENCE DOCUMENT DISTRIBUTION i.

6.


Site Safety/Security, and Sanitation Conference Notes

22. Site Development L.

K.

a.

Property Survey

b.

Topographic Survey

c.

Hydrographic Survey

d.

Fencing Details

e.

Field Compaction Report

f.

Soils Report

g.

Shop Details

h.


Mechanical Completion and Facilities Turnover 1.

Schematic Testing Diagrams

2.

Requests for Inspection

3.

Punch Lists

4.

Notices of Mechanical Completion

Field Construction 1.

Superintendent's Daily Report with Force and Construction Equipment Lists

2.

Weekly Worksheets

3.

Field Action Memoranda

4.

Material/Equipment Receiving Reports

5.

Accident Reports




CORRESPONDENCE EXHIBIT 1-4

DOCUMENT DISTRIBUTION MATRIX EMPLOYER-ORIGINATED CORRESPONDENCE

(To be provided)




CORRESPONDENCE

EXHIBIT 1-4

DOCUMENT DISTRIBUTION MATRIX EMPLOYER-ORIGINATED CORRESPONDENCE

(To be provided)




2. TIME MANAGEMENT I.

OBJECTIVE This Instruction addresses requirements of Contractor's time management functions.

II. GENERAL REQUIREMENTS A. Philosophy Contractor shall employ time management principles to effectively direct and control the TRM Project in its entirety. Accordingly, CONTRACTOR's planning and scheduling efforts shall critically address and monitor those activities and components whose potentially deficient performance could adversely impact overall performance. CONTRACTOR shall limit itself to execution of contractual work items specifically to those which have been previously identified, planned, scheduled, and approved. B. Responsibility Responsibility for time management optimization rests with Contractor and includes not only the activities of CONTRACTOR, but those of project participants (subcontractors, Supervised Contractors, vendors, etc.) under Contractor control. Additionally, CONTRACTOR shall organize related EMPLOYER activities and requirements. In satisfactorily discharging this responsibility, CONTRACTOR shall: 1.

Define the scope and depth of planning/scheduling efforts.

2.

Establish the plan and schedule format consistent with time management optimization.

3.

Provide overall coordination.

4.

Maintain all plans and schedules.

5.

Perform analyses and develop recommendations.

6.

Undertake requisite reporting activities.

III. SPECIFIC REQUIREMENTS A. Time Management Procedures CONTRACTOR's fundamental procedural document shall be the detailed work schedule submitted with its proposal and upgraded within sixty (60) days thereafter. CONTRACTOR shall issue this document as part of its Job Procedures, maintain it accordingly, and update it to define the conduct of its Time Management function. International Bidding Process N° PCI-002-2008-OFP/P ETROPERU



2. TIME MANAGEMENT B. Techniques and Systems Contractor shall utilize techniques of logic network diagramming within approved systems capable of utilizing such techniques (Primavera, MS Project, PERT Master, etc.) The specific approach - CPM, PERT, Precedence, etc. -- may be selected by Contractor subject to EMPLOYER approval. However, level of detail and description must be consistent with all work breakdown structuring and earned value reporting requirements (See Project Instruction Nº 15). CONTRACTOR shall translate requirements and conditions of network diagrams into more manageable control mechanisms for its home office and field construction activities, e.g., daily or weekly worksheets and/or look-ahead schedules. Said mechanisms shall develop finite engineering (EWP) and construction (CWP) work packages and establish interim milestone dates for each major activity. Contractor shall review and amend these mechanisms weekly to ensure they accurately reflect material, personnel and equipment requirements and status. Schedule reports shall be provided to EMPLOYER Project Manager (or their designee) in hard copy and electronic (native file) formats. C. Schedule Designations and Specifications The time management function includes three (3) primary schedule designations relating to three (3) distinct phases of control schedule evolution/development, and three (3) secondary designations to denote significant transition points. These are identified as follows: SD-1 SD-2 SD-3 SD-3FC SD-3MC SD-3S

Initial Project Management Plan (Level 1) Design Specification Plan (Level 2) Definitive Plan (Level 3) Field Construction Plan Mechanical Completion Plan Start-Up Plan

With each successive designation (primary or secondary) Contractor shall amplify level of detail and functional scope of the project schedule's supporting logic network diagrams to reflect available project definition and developing execution strategy. Timing and specifications for these designations are presented in Exhibits 2-1, 2-2, and 2-3. Said criteria however, represent minimum requirements of Contractor's effort. Accordingly, CONTRACTOR shall expand them as EMPLOYER’s Project Manager deems necessary to achieve the most effective coordination, surveillance, and control program to specific project circumstances. (Schedule requirements for shutdown or revamp situations are addressed in Section III.I of this Instruction.)




2. TIME MANAGEMENT D. Schedule Development CONTRACTOR shall produce progressively-developed project schedules at the appropriate stages of project evolution in accordance with the General Provisions; the criteria of Exhibits 2-1, 2-2, and 2-3; and the following requirements: 1. Should CONTRACTOR determine that the need exists to rework a schedule previously approved by EMPLOYER and issued by CONTRACTOR, Contractor shall not undertake said rework without EMPLOYER's prior approval. 2. CONTRACTOR shall submit all schedules to EMPLOYER’s Project Manager for review and approval and shall not release any schedule without EMPLOYER's prior approval. E. Control and Maintenance Contractor shall update the project schedule each month, or more often if required by EMPLOYER’s Project Manager. Schedule analysis and reconciliation shall be included in Monthly Progress Reports (See Project Instruction Nº 14) and shall highlight: 1. Summary of previous report and corrective/preventive measures taken, 2. Significant status changes during the present reporting period, 3. Measures proposed or initiated by Contractor for schedule adherence or time deficit recovery, 4. Summary projections of activities commencing and completing during the next reporting period, 5. Identification (by name) of those individuals charged with the responsibility for resolving present delays and potential problems, and timing for implementation of said actions. F. Progress Reporting In addition to monthly schedule status reports in Section III.E of this instruction, Contractor shall be required to provide EMPLOYER’s Project Manager with the following: 1. Individual progress and performance indices curves for engineering, procurement, and field construction for the entire project. The curves shall present projected and actual progress and be supported by similar curves for engineering discipline, each field construction direct craft, and each International Bidding Process N° PCI-002-2008-OFP/P ETROPERU



2. TIME MANAGEMENT subcontractor by unit or work area. (Development and maintenance of said curves shall be in strict accordance with work breakdown structure and earned value requirements of Project Instruction Nº 15 – Measurement of Percentage Completion). 2. Staffing profiles and Labor burden to support monthly progress projections including "recovery" situations. Representation of staffing requirements shall be consistent with curve development (i.e., by engineering, procurement, and field construction) as above. 3. Evidence that all available steps have been taken to maintain or better the Target Completion Date. This shall be repeated whenever any events that may jeopardize the schedule have taken place. CONTRACTOR shall take timely action to maintain predicted project schedule dates or to minimize delay including revision of work priorities, planned overtime, payment of premiums, and other means. G. Performance Monitoring/Data Access EMPLOYER’s Project Manager will require access to Contractor's field productivity data in order to be able to effectively monitor the execution of all phases of the project. These data include such information as budget hour and physical quantity estimates and adjustments, actual hours or work units expended and physical quantities installed, details of percent physical completion, estimated and actual unit productivity’s for each physical parameter used, productivity graphs and trend curves, and a complete explanation by CONTRACTOR of how CONTRACTOR compiles and uses the productivity data on a timely basis. CONTRACTOR will give EMPLOYER’s Project Manager access to all such data. H. Time Management Effort Appraisal CONTRACTOR shall conduct comprehensive appraisals of its time management effort via formal monthly and quarterly reviews of project status. The reviews shall be chaired by the Contractor's representative charged with the time management responsibilities for the project. In preparing for each review, this representative shall undertake a complete assessment of the schedule. This assessment will note problems (and their resolution), changes, accomplishments, strategy modification, etc. during the period since the last update. Following are typical relevant topics or areas to be addressed: 1. CONTRACTOR/ EMPLOYER/third party interfaces and relationships, 2. Input data relevance and validity, 3. Timeliness and quality of output data, International Bidding Process N° PCI-002-2008-OFP/P ETROPERU



2. TIME MANAGEMENT 4. Information gathering and dissemination, 5. Contingency planning and required development time for same, 6. Time deficit recovery planning and reaction time, 7. Trending and analysis, 8. Project status updating, 9. Schedule risk analysis program. I.

Shutdown Scheduling (if applicable) 1. CONTRACTOR shall appoint a Shutdown Coordinator whose responsibilities are to include all phases of shutdown program as discussed herein. He/she is to serve as direct point of contact with designated personnel regarding all considerations pertaining to shutdown planning and execution. No other work assigned to Shutdown Coordinator shall take priority over shutdown-related work. 2. CONTRACTOR shall prepare a detailed plan and schedule for each planned shutdown. Said plan and schedule shall be prepared in close cooperation with EMPLOYER's designated personnel, and shall be completed and submitted for EMPLOYER's review and approval three months in advance of the planned shutdown date. EMPLOYER will specify planned shutdown dates and shutdown durations for scheduling purposes. Scope of shutdown plan and schedule shall cover all shutdown work on the facility involved whether such work is anticipated to be performed by CONTRACTOR, by EMPLOYER, or by others. Schedule shall be in a format (arrow diagrams, bar charts, combo, etc.) agreed by EMPLOYER and shall show downtime work program by shifts and in hourly increments. Level of detail of work breakdown shall be consistent with the foregoing increments. Shutdown plan shall include the following: a. Itemization and timing of all pre-shutdown work required to achieve minimum downtime b. Itemization of timing of all work required to be accomplished during downtime c. Division of responsibilities d. Resource and other requirements for each item plus any additional "common" resources or other requirements. Resource and other requirements would include:




2. TIME MANAGEMENT •

Construction drawings

•

Construction tools and equipment

•

Construction supplies

•

Labor (by craft)

•

Materials

•

Supervision

•

Temporary facilities

•

Communications

•

Etc.

e. Time line summary of all resource and other requirements f.

Identification of schedule risk areas together with an appropriate contingencies plan to minimize adverse impact on downtime.

3. Shutdown reporting, beyond what is required elsewhere in this instruction shall begin as soon as EMPLOYER has agreed with Contractor's detailed shutdown plan and schedule. Contractor shall continuously maintain current master copy mark-up of shutdown plan and schedule. Reporting shall be primarily accomplished by weekly or daily shutdown planning meetings at Site, attended by designated EMPLOYER and CONTRACTOR personnel and others if required. a. Prior to shutdown, weekly planning meetings will be held. Contractor will present the master copy mark-up for review and will identify any item whose status is unsatisfactory. At the conclusion of the meeting, Contractor will immediately issue an "Exceptions List" specifying corrective action responsible person, and required timing. b. During shutdown, daily planning meeting will be held to review CONTRACTOR's master schedule mark-up, identify problem areas, and agree on following day's work program (including corrective action). At the conclusion of meeting, CONTRACTOR will immediately prepare and issue detailed work program for next day reflecting any agreed on correction action. c. CONTRACTOR will immediately advise EMPLOYER of any situation that might prevent shutdown objectives from being met.


Design Specification Plan

Definitive Plan

SD-2

SD-3

To be prepared by Contractor based on SD-2 development.

To be prepared by Contractor for each Basic Design Package (for which detailed engineering is less than 15% complete) consistent with SD-1 logic and durations. (See Exhibit 2-2 for timing.)

For RC Projects, to be prepared by Contractor within time period specified in MJS.

RESPONBILITY/TIMING

PRESENTATION/FUNCTION


• Continues SD-2’s visibility/control philosophy and, in addition, emphasizes the detailed engineering and procurement areas.

• Consistent with SD-2 development, utilizes an approved logic network diagramming technique (60 day and two week look-aheads to be issued for planning/ coordination of work) for maintenance by EDP methods.

• Provides maximum visibility and control on al item-by-item basis for each Basic Design Specification.

• Developed utilizing an approved logic network diagramming technique for maintenance by EDP methods.

• Serves as initial overview to identify: Project execution implications include primary interdependencies and internal/external restraints. Activities of all project participants – Company, Contractor, Governmental Authorities, and others – and required timing of these activities.

• Presented in logic network format on time scale.

EXHIBIT 2-1 PROJECT SCHEDULE DESIGNATIONS


Initial Project Management Plan

DESCRIPTION

SD-1

DESIGNATION


Mechanical Completion Plan

Start-up Plan

SD-3MC

SD-3S

prior to 75% completion point of field construction. During Precommissioning/ Commissioning, CONTRACTOR shall participate in start-up meetings.

EMPLOYER and CONTRACTOR

To be prepared jointly by

To be prepared by Contractor prior to 85% completion point of detailed engineering and/or approximately 50% completion point of field construction

To be prepared by Contractor prior to 30% completion point of detailed engineering and/or effective field construction initiation.


• Continues SD-2’s visibility/control philosophy and fully completes transition to start-up stage begun with SD

• Consistent with SD-2 development, utilizes an approved logic network diagramming technique for maintenance by EDP methods.

• Continue SD-2’s visibility/control philosophy. Also begins transition to startup emphasis by highlighting last 50% field activities and developing concentration upon process systems


• Continues SD-2’s visibility/control philosophy. In addition, emphasized field construction sequence stressing the first 50% activities.


EXHIBIT 2-1 PROJECT SCHEDULE DESIGNATIONS


Field Construction

SD-3FC


2400

1200

1200

250

(Cumulative)

Prior to 30% completion point of detailed engineering



RC: Within Agreementspecified time period

PROJECT TIMING

30

50

50

40

DETAILED ENGINEERING

25

25

25

35

PROCUREMENT

40

20

20

20

FIELD CONSTRUCTION

5

5

5

5

START-UP


FUNCTIONAL ACTIVITY DISTRIBUTION (AS A PERCENTAGE OF ACTIVITY TOTAL)

EXHIBIT 2-2 SPECIFICATIONS FOR ACTIVITY LEVELS PROJECT SCHEDULE ACTIVITY TOTAL AND FUNCTIONAL DISTRIBUTION

TIME MANAGEMENT


(Field Construction Plan)

SD-3FC

(Definitive Plan)

SD-3

(Design Specification Plan)

SD-2

(Initial Project Management Plan)

SD-1

DESIGNATION (Description)

ACTIVITY TOTAL


3100

2800


Prior to 85% completion point of detailed engineering and/or approximately 50% completion of field Construction 18

20


3. Activity totals and functional distribution carry a + 10% range of acceptability.

2. Activity totals exclude restraints between work items. (Restraint totals should half the activity total).

18

20

EXHIBIT 2-2 SPECIFICATIONS FOR ACTIVITY LEVELS PROJECT SCHEDULE ACTIVITY TOTAL AND FUNCTIONAL DISTRIBUTION

TIME MANAGEMENT

1. Refer to Exhibit 2-3 for Project Schedule Activity Specifications.

NOTES:

(Start-Up Plan)

SD-3S

(Mechanical Completion Plan)

SD-3MC


50

53

14

7




TIME MANAGEMENT EXHIBIT 2-3 PROJECT SCHEDULE ACTIVITY SPECIFICATIONS All SD-1 schedules shall satisfy the following criteria in order to comply with the requirements of Exhibit 2-2, "Specifications for Activity Levels": 1. The activities (and timing thereof) for each major participant of the project shall be identified and the interfaces/dependencies clearly described. 2.

With respect to detailed engineering activities, approximately half of these shall highlight the interdisciplinary relationships and interfaces which exist.

3. All activities in both detailed engineering and procurement must comply with the work breakdown structure and the required sequence of field construction and startup. 4. For equipment and material deliveries of a critical or long lead nature, the associated detailed engineering and procurement activities (including execution strategy) shall be clearly defined 5. All critical path sequences and float calculations must be completely identified. All SD-2, SD-3, SD-3FC, SD-3MC, SD-3S schedules shall satisfy the following criteria in order to comply with requirements of Exhibit 2-2, “Specifications for Activity Levels”: 1. Scope of activity coverage and distribution should be consistent with areas of risk exposure as identified. 2. All activities must possess the characteristics of being finite, definable and measurable (i.e., consistent with the work breakdown structure.) They must be appropriately resourced and leveled. 3. Coverage of critical and sub-critical (three months of critical path) activities shall be at least twice that provided for non-critical activities. 4. Where phased task completions are required, they must be properly identified. 5. The following specific requirements apply: • Detailed Engineering -

85% of the activities shall be between 5 and 20 project time units in duration.

-

80% (approximate) of the activities shall be distributed consistent with the breakdown by engineering man-hours by discipline and subdiscipline.




TIME MANAGEMENT EXHIBIT 2-3 PROJECT SCHEDULE ACTIVITY SPECIFICATIONS •

•

•

Procurement -

Distribution of activities should be on the basis of 60% major equipment and 40% bulk materials.

-


Field Construction -


-

85% of the activities shall be distributed consistently with the breakdown by field labor man-hours by construction craft and discipline.

Startup -

80% of the activities for SD-3MC and SD-3S schedules should be between 1 and 5 project time units in duration.




3. COST MANAGEMENT I.

OBJECTIVE This instruction covers Contractor's requirements for effective management of costs relating to the Agreement. Contractor's cost management activities are a significant part of a comprehensive, totally integrated project control program which Contractor must develop and implement for execution of the Work. Refer to Time Management (Project Instruction Nº 2) and Quality Management (Project Instruction Nº 4) for other significant components of the control program. It should also be noted that EMPLOYER intends to convert the contractual arrangement from a Reimbursable Cost (RC) structure to a Lump Sum (LS) arrangements at some point (Conversion) following completion of the Scope Definition, but prior to the start of Construction activities. Once this Conversion from RC to LS has been effected, the requirements of this Instruction shall be superceded and the requirements of Project Instruction Nº 2 – Time Management, Instruction Nº 8 – Change Control, Instruction Nº 14 – Monthly Progress Reporting and Instruction Nº 15 – Measurement of Percentage Completion shall be the primary Project Controls requirements by which Contractor must abide.

II. GENERAL REQUIREMENTS CONTRACTOR shall submit, at the Contract signature, for EMPLOYER review and comment the proposed organizational and procedural details defining its cost management program for the project. These details will be included in the Project Execution Plan and will be subject to modification as EMPLOYER's Project Manager deems necessary to satisfy in a deeper way: •

Cost Control

•

Estimating

•

Non-Recoverable Costs

III. SPECIFIC REQUIREMENTS A. Cost Control In conjunction with requirements of Section III.C (Non-Recoverable Costs) of this instruction and Project Instruction Nº 8 (Change Control), CONTRACTOR shall conduct a cost control program throughout the life of the project to attain established financial goals per Section III.B (Estimating) of this instruction. Specific requirements of said program are presented in the following paragraphs.




3. COST MANAGEMENT 1. Procedures and Organization Contractor shall submit, at the Agreement Signature, as in II above, the following information relevant to the Cost Management procedures and organization: a. A work flow diagram describing structure and formal communication link between all cost management organizational elements (both project and corporate) from the Contractor's Project Manager to all subordinate work production units whose performance is involved in data collection, status evaluation, and forecasting process. Manual and electronic-generated forms and other documents which are to convey cost information (including performance data and corrective action) from one organizational unit to another and to and from external parties such as subcontractors and vendors shall be identified on appropriate flow paths of this diagram. b. Contractor shall include a copy of each identified document along with information describing its purpose, intended application, responsibility for preparation, and frequency of issue. Instructions for each form shall also be included. c. An organization chart identifying individuals responsible for each organizational unit of the cost management structure and a description of duties. d. Description of surveillance/control procedures and the application limits to be employed in effectively executing the following cost management functions: •

Estimating

•

Cost Analysis and Forecasting

•

Preventive and Corrective Action

•

Non-Recoverable Costs.

e. Description of the interaction and coordination between the cost management, project management, and time management functions. 2. Functions Subsequent to EMPLOYER’s review of CONTRACTOR's procedures and organization as above, Contractor shall execute the following cost management functions: International Bidding Process N° PCI-002-2008-OFP/P ETROPERU



3. COST MANAGEMENT a. Estimating (Section III.B) b. Non-Recoverable Costs (Section III.C) c. Change Control (Project Instruction 8) d. Cost Analysis and Forecasting Contractor shall make daily cost analyses and summarize the results in its Monthly Cost Report. Contractor shall employ sampling techniques for said analysis to identify and correct at an early stage of project evolution unfavorable trends in such areas as: -

Home office hours/expenses

-

Engineered equipment purchase order prices

-

Bulk material quantities

-

Field labor productivity

-

Design basis changes

CONTRACTOR shall undertake forecasts weekly, bi-weekly, and monthly as project conditions dictate and EMPLOYER's Project Manager deems necessary for effective project control. CONTRACTOR shall include in its Monthly Cost Report (or more frequently as EMPLOYER's Project Manager determines) results of said forecasts, which results shall represent its best projection of cost to complete for the entire project, irrespective of the amounts included in the Control Budgets (FEED Services and Projected TIC). e. Cost Reporting Contractor shall prepare a Monthly Cost Report, which shall contain as a minimum the following components: -

Tabulation of Control Budget line items, authorized changes, and a summation of the two to form adjusted Control Budget

-

Tabulation by Control Budget line item of actual, recorded expenditures as provided by Contractor's accounting group

-

A similar tabulation of committed funds (e.g., purchase orders, purchase authorizations, etc.)




3. COST MANAGEMENT -

Similar tabulation of pending changes

-

Forecast of cost to complete for each line item

-

Summation of each item's expenditures, commitments, pending changes, and forecasts to develop predicted final Contract Price

-

Comparison of adjusted Control Budget and predicted final Contract Price for each line item, and an analysis of overruns/underruns with explanation for each.

To maintain consistency with Contractor responsibilities and forecasts, Control Budget scope shall be amended only by authorized changes. f.

Preventive/Corrective Action Subject to prior agreement with EMPLOYER'S Project Manager as to frequency, Contractor's Project Manager shall hold regular cost control meetings with the project cost engineer and responsible supervisors to address the following: -

Review and analysis of the latest Monthly Cost Report in conjunction with input from Contractor's home office and field cost control functions

-

Assessment of corrective efforts previously initiated to counter actual or potential overruns

-

Identification of additional overruns or undesirable trends

-

Initiation of new preventive and corrective measures

EMPLOYER's Project Manager and/or designated representatives shall participate in said meetings as EMPLOYER's Project Manager deems necessary. In addition to surveillance effected at regular cost control meetings, Contractor shall continuously and accurately monitor and report all trends, initiating corrective/ preventive action as needed and optimizing costs in already acceptable performance areas. B. Estimating 1. Estimate Designations In addition to the Control Estimate (discussed in detail in III.B.3 below), Contractor shall prepare cost estimates at EMPLOYER's direction at any point International Bidding Process N° PCI-002-2008-OFP/P ETROPERU



3. COST MANAGEMENT in the evolution of the project. CONTRACTOR shall submit all estimates to EMPLOYER's Project Manager for review and approval and shall not release any estimate without EMPLOYER's prior approval. When approved by EMPLOYER, each successive estimate shall become Contractor's current baseline project cost parameter. Should CONTRACTOR determine that the need exists to rework an estimate previously approved by EMPLOYER and issued by CONTRACTOR, CONTRACTOR shall not undertake said rework without EMPLOYER's prior approval. Contractor's estimate shall reflect at each successive evolution point: •

Available project definition and cost data

•

Development execution strategy

•

An accuracy range consistent with the quality of these items and estimating technique employed

Estimates shall also be consistent with the particular schedule designations and levels of detail specified in Project Instruction Nº 2 as well as EMPLOYER quality objectives. They shall include a detailed reconciliation with each previous estimate. Representative estimate designations with corresponding schedule designations, follow: Estimate Designation (ED)

Estimate Title

accuracy

ranges,

Accuracy Range

Schedule Designation (SD)

Undefined

*

ED-000

Conceptual

ED-00

Modular-Process

±50%

*

ED-0

Modular-Operating Unit Factors (Curve)

±50%

*

ED-1

Major Equipment (Factored)

±15%

SD-1

Control

±10%

SD-2/SD-3

Upgraded Control (Pre-Construction)

±5%

SD-3FC (Upgraded)

ED-2 ** ED-3

and

*Schedule consistent with estimate data. **ED-2 is to be considered equivalent to AACEI Class 2 – Cost Estimate designation.




3. COST MANAGEMENT 2. Supplementary Estimates CONTRACTOR shall exercise cost control throughout the period of early estimate development, to prevent cost "blackouts" during those phases when EMPLOYER may be making significant changes in scope, such as often occur during FEED Phase. Accordingly and as directed by EMPLOYER's Project Manager, CONTRACTOR shall prepare supplementary or transitional estimates to cover the progression from one established baseline to another. Such estimates will include a detailed reconciliation with each previous estimate. 3. Control Estimate (ED-2) CONTRACTOR shall prepare a Control Estimate (ED-2) which, when mutually approved by EMPLOYER and CONTRACTOR at Conversion, shall become the Contract Price for the project. Said Contract Price shall reflect Contractor's scope of work and shall provide the only mechanism by which Contractor may execute contractual commitments, except those covered in Section III.C of this Instruction. CONTRACTOR shall progressively develop the ED-2 in discrete portions throughout the FEED Phase, reflecting the scope of Work in a particular Unit FEED Package. When approved byEMPLOYER, each ED-2 portion will become part of the TIC Control Budget. Subsequent to EMPLOYER's approval of the final portion, CONTRACTOR shall produce the composite TIC Control Budget which shall reflect adjustments for all EMPLOYER’s approved changes to each ED-2 portion after its original approval/release. Following are the requirements of the ED-2 with respect to development, bases, and documentation: a. Developmental Requirements CONTRACTOR shall not begin ED-2 developmental activities until EMPLOYER has released Contractor to proceed. The mechanism for this release shall be provided by a joint meeting between CONTRACTOR and EMPLOYER's Project Managers to review and confirm the various components of the estimate development as follows: •

Developmental Cost and Personnel CONTRACTOR shall prepare for EMPLOYER approval an estimate of costs and personnel associated with developing each ED-2 portion and the composite TIC Control Budget.




3. COST MANAGEMENT •

Developmental Timing Contractor shall prepare a schedule of release for each ED-2 portion and the composite TIC Control Budget which shall acknowledge: -

Release of the ED-2 portion no later than thirty (30) days after release of the particular Unit FEED Package

-

Release of the composite ED-2 TIC Control Budget no later than thirty (30) days after release of the last Unit FEED Package

-

Continuing EMPLOYER review during development as well as final review and approval prior to release of the respective ED-2 portion and the composite TIC Control Budget.

b. Estimate Technical Basis Contractor's technical basis for the ED-2 shall be limited to completed Unit FEED Packages, excluding any impact of anticipated scope changes or input from preliminary detailed engineering. c. Estimate Cost and Scope Basis Contractor shall address for EMPLOYER consideration, review and approval, representative cost and scope basis elements such as: •

Wage rates, productivity factors, and attendant source reliability for home office and field

•

Engineered equipment cost data sources

•

Bulk material quantities, unit costs, labor units, and source reliability for all

•

Escalation due to schedule considerations and source reliability for same

•

Implications of shutdown or revamp work

•

Impact of anticipated currency devaluation/revaluation

•

Definition of allowances, contingencies, and other factors

•

Qualifications or exclusions from estimate scope




3. COST MANAGEMENT d. Estimate Content and Documentation Contractor's completed ED-2 portion shall satisfy following requirements with respect to content and documentation: •

Estimate shall be completely compatible with Contractor’s cost control system for the project.

•

Estimate details shall be entirely consistent with CONTRACTOR's standard accounting codes (Project Instruction 10, Section II.A), Project Schedule (Project Instruction 2), and all Work Breakdown Structuring and Earned Value reporting requirements (Project Instruction 15).

CONTRACTOR shall provide for review by EMPLOYER's Project Manager all supporting estimate development documentation (Estimate Basis Memorandum – EBM prior to preparation of the Estimate. Following Estimate preparation, documentation of the techniques, factors, data sources, allowances, assumptions, etc. shall be provided as backup to the Estimate). The extent of said supporting documentation shall be established during the above noted estimate development meeting at which time a typical Contractor estimate and supporting documentation shall be reviewed. C. Non-Recoverable Costs CONTRACTOR shall monitor and control all cost expenditures and commitments in the period between Agreement Award and approval of the completed Control Estimate. By definition, such obligations contain cost elements which EMPLOYER could not recover should the project abort. CONTRACTOR shall thus minimize EMPLOYER's financial exposure as follows: 1. Commitment Projections CONTRACTOR, in conjunction with schedules in Project Instruction 2 – Time Management, shall develop projections of commitments with breakdowns of the non-recoverable portions thereof. 2. Restrictions CONTRACTOR shall upon EMPLOYER's release to proceed with Control Estimate (ED-2) development (Section III.B) perform only those services and accrue costs associated with:




3. COST MANAGEMENT a. Developing the ED-2 Estimate b. Preparing the SD-1 Schedule (Initial Project Management Plan) c. Preparing the SD-2 Schedule (Design Specification Plan). 3. Other Limitations Contractor shall undertake other work which has been: a. Detailed in completed portions of the Control Estimate which have been previously approved by EMPLOYER b. Specifically authorized by EMPLOYER such as other estimates and schedules, various studies, etc. (Contractor shall comply fully with all applicable contractual requirements for such other work.)




4. QUALITY MANAGEMENT I.

OBJECTIVE This instruction addresses project quality management efforts required of contractor in the following areas: •

Home Office

•

Shop Inspection

•

Field

II. GENERAL REQUIREMENTS A. Home Office 1. CONTRACTOR shall submit, at the Agreement Signature, for EMPLOYER review and approval, its proposed quality levels for home office engineering and procurement functions as follows: a. Engineering - quality levels to be specified in terms of applicable codes, standards, Basic Design Packages, General Engineering Specifications, Design Practices, etc.; and in terms of engineering performance (See Instruction 9 – Project Specifications). b. Procurement - quality levels to be specified by vendor selection criteria, purchase specifications, inspection philosophy, etc. (See Project Instruction 5 - Procurement). 2. CONTRACTOR shall likewise submit, at the Agreement Signature, for EMPLOYER review and approval, its procedures for attaining and maintaining the above quality. Said control procedures shall include Contractor's in-house audit program. B. Shop Inspection 1. Prior to executing purchases of any of the materials or equipment presented in Exhibit 4-1, CONTRACTOR shall submit for EMPLOYER review and approval its proposed shop inspection program for the project including all procedures, plans and schedules. CONTRACTOR will take into account the quality control requirements stated in the licensed BDPs.




4. QUALITY MANAGEMENT 2. Contractor's inspection requirements:

procedures

shall

address

following

minimum

a. Order Information •

CONTRACTOR shall ensure that its purchase orders and its prime vendors' suborders contain full and complete order identification and information including inspection requirements, specifications, and procedures as applicable. Where EMPLOYER's Inspection Project Manager approves Contractor's recommendation that inspection be waived for a particular order, Contractor shall promptly advise vendor.

•

CONTRACTOR shall be responsible for complete continuity of all order identification and inspection information from prime vendors to subvendors’ agents to verify prime vendors' sub-orders for compliance.

•

Contractor shall pursue prompt rectification of all order information deficiencies in its own purchase orders and in the sub-orders of its prime vendors.

b. Execution/Inspection •

Prior to releasing fabrication, CONTRACTOR shall review and approve vendor fabrication procedures.

•

CONTRACTOR shall ascertain that Order Execution Programs (See Project Instruction 5, Section III.B - Procurement) contain adequate provisions for scheduling inspections.

•

Contractor shall cause vendor to have available for Contractor's inspector, prior to or at time of final inspection, all necessary documentation including:

•

-

Certified mill test reports,

-

Material data and charts,

-

Code forms,

-

Weld X-rays

CONTRACTOR'S inspector shall reject any material or equipment which fails to satisfy all requirements of its purchase order, including provision of required final inspection data as above. Items shipped to the Site prior to said release shall be summarily rejected.




4. QUALITY MANAGEMENT •

In the event of vendor's failure to provide required final inspection data, Contractor's inspector shall not release the item until he/she has received and reviewed said information. Vendor shall be required to undertake (and assume all costs for) verification tests for materials lacking adequate identification.

•

Equipment and material rejected as above shall retain that status and shall not be released until all order requirements have been satisfied by action approved by EMPLOYER's Project Manager.

c. Inspection Documentation •

CONTRACTOR's inspector shall prepare and distribute inspection notices in accordance with Exhibit 1-3.

•

CONTRACTOR's inspector shall issue appropriate release or rejection notices at vendor's facilities with subsequent distribution in accordance with Exhibit 1-3 (Project Instruction Nº 1). Rejection notices shall identify the specific cause of rejection (e.g., insufficient data, poor workmanship, etc.). Where vendor is required to undertake material verification tests as in II.B.2.b., CONTRACTOR shall so advise EMPLOYER.

•

For items where inspection is not required or has been waived, CONTRACTOR shall provide all test documentation for EMPLOYER in accordance with Job Specifications.

d. EMPLOYER's Inspection Privileges •

EMPLOYER's right to inspect or witness principal items tests (long lead items) or other tests it deems appropriate. .

•

CONTRACTOR shall keep EMPLOYER fully informed of its inspection plans and scheduled testing by vendors so that EMPLOYER can coordinate with Contractor any inspection or test witnessing it elects to carry out.

•

EMPLOYER will exercise its best efforts to give Contractor reasonable advance notice of any vendor inspections or test witnessing it plans to carry out.

C. Field 1. CONTRACTOR shall develop a comprehensive program of Quality Assurance (QA) and Quality Control (QC) covering all field work, and shall provide recommendations to EMPLOYER’s Project Manager and designated QA International Bidding Process N° PCI-002-2008-OFP/P ETROPERU



4. QUALITY MANAGEMENT representatives to ensure that said program is consistently and continuously applied for the duration of the job. 2. CONTRACTOR'S QA/QC program is subject to review by EMPLOYER’s representative prior to implementation. 3. The depth, detail, and level of Quality Control defined in Contractor's QA/QC program shall be not less than that contained in EMPLOYER's internal quality control procedures. 4. Review of Contractors' QA/QC program, or reference to, or any use of EMPLOYER's procedures will not relieve Contractor of its obligation to meet all requirements of Job Specification. D. Quality Management Plan Contractor's detail Quality Management Plan shall be specific to the requirements of the project and be submitted as part of its Project Execution Proposal. All adjustments will be incorporated and form the basis for Contractor's Quality Assurance program. E. Quality Management Organization To ensure Contractor's Quality Management Organization has the autonomy to carry out its duties objectively, the Quality Assurance Manager assigned to the project will have an independent reporting relationship with Contractor's corporate management.




4. QUALITY MANAGEMENT EXHIBIT 4-1 MATERIALS/EQUIPMENT REQUIRING INSPECTION1

1. Critical Long Lead Items. 2. Equipment and material defined in the Licensed and Unlicensed Basic Packages. 3. Furnaces and Boilers.

1

EMPLOYER and PMC CONTRACTOR will develop this point prior to Agreement signature.




5. PROCUREMENT I.

OBJECTIVE This instruction addresses requirements to be satisfied by Contractor. It should also be noted that EMPLOYER intends to convert the Contract Agreement from a Reimbursable Cost (RC) structure to a Lump Sum (LS) agreement at some point following completion of the Scope Definition stage, but prior to the start of Construction activities. Once this conversion from RC to LS has been effected, the requirements of this Instruction shall be superceded and the requirements of Project Instruction Nº 2 – Time Management, Instruction Nº 8 – Change Management, Instruction Nº 14 – Monthly Progress Reporting and Project Instruction Nº 15 – Measurement of Percentage Completion shall be the primary Project Controls requirements by which Contractor must abide.

II.

GENERAL REQUIREMENTS CONTRACTOR shall undertake all procurement activities (from potential source nomination to Site delivery) for securing on a timely basis and in satisfactory condition, material, equipment, subcontracts, and services required for the Project. The scope of this responsibility encompasses all vendor and subcontractor nomination, purchasing, subcontracting, expediting, inspection, and traffic management functions. Additionally, the Scope Definition includes assumption of any procurement activities initiated by EMPLOYER prior to Agreement Award. If it is necessary that the Contractor takes over some procurement started by the EMPLOYER, this will be considered as Early Work.1 (Attendant inspection responsibilities are covered in Project Instruction 4 – Quality Management.) 1. CONTRACTOR’s procurement activities shall be consistent with EMPLOYER’s procurement policies. Generally these include:

1

•

Material, equipment, and services of all types shall be purchased from any financially sound, reputable, and capable source.

•

The basis for selection shall be the most economical source which will reflect the best combination of quality, price, delivery, services, and reliability.

•

Purchases shall be consistent with efficient inventory management and utilization policies. With respect to the latter, particular emphasis shall be given to the interchangeability of equipment components.

•

All materials and equipment will be new and unused.

Question 113 - Round 3




5. PROCUREMENT •

Any drawings, data, specifications, instructions, schedules, packing lists, and any other literature supplied by vendor shall be in the English or Spanish languages.2

2. CONTRACTOR shall appoint a coordinator whose primary responsibility shall be to provide liaison between EMPLOYER and CONTRACTOR on all procurement matters. III. SPECIFIC REQUIREMENTS A. Proposed Vendors and Subcontractors EMPLOYER will provide timely the Contractor with a listing of qualified vendors, manufacturers and subcontractors as shown in Exhibit 5-1 for the Work. Within one (1) month after Agreement Award, Contractor shall submit its list of proposed vendors and subcontractors (including agencies). EMPLOYER shall review said lists designating each vendor or subcontractor as follows: Designation

Acceptability

1

Acceptable

2

Not acceptable for category proposed

0

EMPLOYER does not have sufficient Information

Notes:

2

1.

Proposed vendors are to be manufacturing sources only. Trading companies, vendor representatives, supply houses, and other "middleman" are not acceptable sources without prior approval of EMPLOYER.

2.

Proposed vendors lists shall be in accordance with applicable categories and sequence shown in Exhibit 5-1 attached hereto.

3.

Only designation "1" vendors and subcontractors may be used for the project. Designation "0" may be upgraded to designation "1" upon submission by Contractor of supportive information (e.g., experience, technical capability, financial soundness, etc.) satisfactory to EMPLOYER.

Question 114 – Round 3.




5. PROCUREMENT 4.

A "1" designation by EMPLOYER is not an unqualified acceptance or approval. The "1" classification refers to technical acceptability (i.e., capability to perform -- sometimes related to rather broad areas of material or equipment supply or construction expertise). Before placing an order with a "1" vendor or subcontractor, other prerequisites must be met, such as having the capacity to carry out the work within project time restraints, and having the necessary and specific demonstrated commercial experience.

The manufacturers (or vendors) lists approved by the EMPLOYER for the critical processes equipment will be provided with the basic design packages of the licensed processes. For the other equipment and systems, the CONTRACTOR will present its proposal for the approval of the EMPLOYER. In the subcontractors’ case, the EMPLOYER will be able to present an approved list and the CONTRACTOR shall also present its proposal. Where EMPLOYER is unfamiliar with certain proposed vendors or subcontractors, Contractor shall submit commercial and technical evidence to support the nominations and arrange shop surveys if so required. To avoid the potential implications of conflict of interest, CONTRACTOR is to advise EMPLOYER if any of proposed vendors are: a. Affiliates or subsidiaries of Contractor, or b. Organizations in which a substantial interest is held by Contractor, its affiliates or subsidiaries, either directly (by officer) or indirectly (by nominees or families of officers). Release of CONTRACTOR to proceed with solicitation shall be effected only by authorization of EMPLOYER's Project Manager. CONTRACTOR shall confirm the acceptability of source for materials purchased by its own subcontractors and by Supervised Contractors (See Project Instruction 11 – Responsibility for Other Contracts). B. Purchasing 1.

Inquiry, Bidding and Purchasing Preference shall be given to locally-supplied materials and equipment provided that the best combination of cost, quality, and schedule is not compromised.




5. PROCUREMENT Prior to soliciting queries from vendors, Contractor shall address the need for protecting any Licensor's proprietary information by having proper confidentiality agreements executed as necessary. Vendor shall agree to treat as confidential all information of a business or technical nature. Vendor shall not disclose confidential information to any third party or use any part thereof, except in performance of services hereunder. Vendor shall agree to limit access to such business or technical information to those employees reasonably requiring such access for the purpose of the performance of this Work. Vendor shall agree to use its best effort in requiring that its employees maintain the strictest confidence concerning proprietary business and technical information. Vendor should operate a quality management system which meets the requirements of ISO 9000. Supplier is not required to be ISO 9000 certified, unless so designated by EMPLOYER. It shall be deemed that the vendor has acknowledged full compliance to ISO 9000 unless supplier submits details of any proposed alternative quality system standard during the bidding phase, or identifies areas of noncompliance with any part of the quality standard. CONTRACTOR shall secure approval of Project Manager prior to releasing of the inquiries for purchases, in accordance to the Agreement. Except when there is only one vendor or in case of a Job Specification waiver, purchasing shall be made upon competitive bidding by three or more acceptable vendors. (Supplemental orders may, however, be placed directly with a selected vendor, subject to prior EMPLOYER approval.) 2.

Purchase Inquiry Requirements a. Contractor shall ensure that its inquiry contains the following minimum information: •

EMPLOYER identification as ultimate user.

•

Project name, location and project or unit symbol.

•

Contractor's requisition number.

•

Required ex-works delivery date, indicating priorities and delivery sequence if necessary.

•

Quantity and item numbers.




5. PROCUREMENT •

Account code(s) chargeable.

•

Item description with all relevant specification and code data.

•

Required receipt date for shop drawings, design calculations, and other vendor data relevant to Contractor's needs and those of others.

•

Delivery date* for all requested complete parts lists and recommendation for special tools** and Category III spare parts, including firm quotations for both written price commitments for the spare parts, valid for ninety (90) days after the placement of prime order.

•

Required number(s) of instruction, operating, and service manuals, stating applicable language requirements.

•

Export (if applicable) customers and duties requirements.

•

Inspection instruction.

•

Tax considerations.

•

Bulk material returned goods and/or cancellation clause provisions. * As a rule, Contractor shall use its best efforts to cause bidders to include this information with their bids for the parent equipment and quotations for designated spares. ** Special tools required for operation/maintenance and not included within the scope of the parent equipment quotation shall be ordered as designated spare parts with the original order placement, consistent with the definition of Category I spares (See Section III.F). Special tools included in the parent equipment quotation shall subsequently be turned over to EMPLOYER with the equipment and the cost for same shall be included in the Contract Price.

b. Where applicable, Contractor's inquiry documents shall instruct bidders to: •

Submit bids via closed package in accordance with procedures specified by Contractor (See Section III.C.8).

•

Submit bids by the specified date specifying delivery dates and commercial terms, and quoting prices for designated spare parts.* *

CONTRACTOR shall note that, for accounting purposes, EMPLOYER shall require price details for all Category I spares.




5. PROCUREMENT •

Submit a graphic schedule detailing engineering, procurement, manufacturing, and other activities required to execute order within delivery times quoted (Order Execution Program).

•

Provide the following information: Operating costs, when applicable; -

Discount credits, shipping costs, payments schedule, etc.;

-

Recommendations and quotations for Category III parts and Category I special tools (to supplement the quotations for designated spares specified);

-

Detailed presentations, with commercial terms, addressing the bidder's technical support capability for pre-commissioning, startup, and post-commissioning operations and emergencies;

-

Detailed presentations of the bidder's procedures for dealing with repairs and spare parts, noting:

-

+

Normal stock items and location of same,

+

Normal and emergency delivery means and times;

Detailed communications procedures to accommodate EMPLOYER requests (both normal and emergency) for parts and service during and subsequent to commissioning. The procedures shall identify responsible parties with job titles, addresses, phone numbers (office and home) and facsimile numbers.

c. CONTRACTOR shall state in its purchase documents that vendor's failure to transmit all required documentation will cause the order to be considered incomplete. Following procedures shall be undertaken by CONTRACTOR with respect to releasing, distributing, and interpreting completed inquiry documents: •

CONTRACTOR, prior to release of any inquiry package for major purchases shall submit for approval the following information to EMPLOYER: -

Specific vendors from whom quotations are being solicited

-

Programmed release date of inquiry documents




5. PROCUREMENT

3.

-

Proposed receipt date of bids

-

Basis of bidding (lump sum, reimbursable cost, unit prices, etc.)

-

Basis of delivery (F.O.B., C.I.F., etc.)

•

EMPLOYER’s Project Manager shall receive, simultaneously with bidders and other recipients designated in Exhibit 1-3, copies of all inquiry documents with accompanying purchase specifications, data, etc. Any subsequent EMPLOYER’s comments will be expeditiously transmitted to the Contractor. However, CONTRACTOR is not to delay its purchasing sequence in anticipation of the comments.

•

Should queries arise during the bidding period which evidence a need for clarification of inquiry documents, such clarification shall be provided to all bidders by: -

Written communication copied to EMPLOYER’s Project Manager; and

-

Telephone or email communications, with written confirmation copied to EMPLOYER’s Project Manager.

Bid Receipt and Review Requirements Contractor's bid receipt and review procedures shall satisfy following requirements: Bid Receipt For major purchases or as otherwise required by EMPLOYER, quotations shall be received by closed bid only, subject to following additional requirements: • Bids shall only be opened on the official due date unless all have been received earlier, and EMPLOYER's Project Manager agrees to an earlier opening. • Bids received subsequent to the official opening, shall not be accepted. • CONTRACTOR shall take all necessary measures to maintain security of closed bids.




5. PROCUREMENT Bid Review Tabulations • Non-Major Purchases For non-major purchases CONTRACTOR shall proceed in accordance to the Agreement terms, CONTRACTOR may note down the bids in tables as per its normal practice. Where, however, a single source quotation has been received or the selection has been made on other than lowest cost, preparation shall follow requirements of major purchase tables. • Major Purchases For major purchases or as otherwise required by EMPLOYER, note down in the tables the bids that take into account all relevant commercial and technical factors which support Contractor's recommendation of a particular bidder. Such factors shall clearly demonstrate: Competitiveness, fairness, and reasonableness of the bidder's quotation; Achievement of best combination of schedule, quality and cost (including operating and spare parts elements); - Acceptability of successful bidder's Order Execution Program as in B.2.b. above. (Programs of the prime and next leading contenders shall be submitted for comparison); - Satisfactory technical appraisal of recommended bidder's quotation, consistent with Job Specification requirements. • Company shall have full access to details of all bidders' quotations. • In addition to the specific factors supporting Contractor's recommendation, Contractor shall ensure that all tables address the following representative requirements: - Operating costs, when applicable; - Discount credits, shipping costs, progress payments, duties, etc.; - Comparison of cost vs. control estimate; - Comparisons of promised delivery vs. schedule requirements, etc.; - Confirmation of compatibility of shop capacity and Order Execution Program with project requirements;




5. PROCUREMENT - Promised dates for spare part and special tool recommendations and quotations; - Promised dates for shop drawings, design calculations, and other relevant data; - Inquiry deviations and the resolution of same; - Costs of vendor representative technical support. 4.

Purchase Order Release Requirements a. CONTRACTOR shall review the bid tabulation with and secure approval of EMPLOYER’s Project Manager prior to placing an order and shall provide incremental cost, schedule, and technical data for alternative bidders, if requested. b. Contractor shall assume responsibility for any procurement activity engaged in by EMPLOYER prior to Contract Award. Contractor shall take on and handle all subsequent activities for each item, regardless of the state of procurement, as instructed by EMPLOYER’s Project Manager. If it is necessary that the Contractor takes over some procurement started by the EMPLOYER, this will be considered as Early Work. For acquisitions initiated by the EMPLOYER before awarding a bid, the procedure is as follows:

5.

a)

FEED: purchases of long lead items are made in accordance with the terms agreed between the parties.

b)

EPC: purchases are the responsibility of the CONTRACTOR, and are within the scope of the EPC Conditions. The terms of these purchases will be defined during the cost estimating process (OBE) 3.

Purchasing Controls a. Material Requisition Status (MRS) Report CONTRACTOR shall issue MRS Reports on a monthly basis (or less often as directed). These reports shall contain the following information relevant to each MR required for the project: •

3

Scheduled and actual release date from engineering to procurement;





5. PROCUREMENT •

Vendor prescreening (if required), actual prescreening lists and responses;

•

Proposed or actual bidders list;

•

Scheduled and actual release date of the inquiry;

•

Scheduled and actual quotation receipt dates;

•

Scheduled and actual purchase order placement dates.

An MR shall be deleted from MRS Reports one month subsequent to actual purchase order placement. b. Purchase Order Record (POR) CONTRACTOR shall issue the POR on a monthly basis or more often as directed by EMPLOYER. The POR may be combined with the Material/Equipment Status Reports as noted in III.D.3.b. As a minimum requirement, the POR shall contain the following information: •

Proposals request number and date

•

Purchase Order number and date

•

Vendor and source country

•

Brief description of item

•

Item number

•

P.O. value

•

Required delivery dates for design data, equipment/materials, and spare parts

•

MR numbers or designation

c. EMPLOYER Identification CONTRACTOR shall ensure that EMPLOYER, with address, is appropriately identified by stamp, stencil, or other means approved by EMPLOYER’s Project Manager, as purchaser of record on:




5. PROCUREMENT •

All CONTRACTOR purchase orders;

•

All vendor or subcontractor inquiries and purchase orders;

•

All items shipped to the Site or directly to EMPLOYER's warehouse. (Items shipped to EMPLOYER's warehouse shall bear the proper EMPLOYER equipment numbers).

d. Correspondence All correspondence, specifications, spare parts data, and other procurement papers shall be distributed in accordance with the correspondence distribution requirements of Exhibit 1-3 and identified as follows: •

Project name/location,

•

Project symbol or code,

•

EMPLOYER's contract number,

•

Inquiry or Purchase Order number,

•

Equipment numbers as applicable.

e. Field Purchasing With the exception that all field purchases (except as stipulated by EMPLOYER) require prior approval of EMPLOYER's Site Representative, the above-noted detailed requirements shall also apply to field purchases. Alternations or additions to said requirements will be mutually agreed upon by CONTRACTOR and EMPLOYER’s Project Manager or designated representative. 6.

Major Construction Equipment Rental CONTRACTOR's rental of major construction equipment shall comply with relevant above-noted purchasing requirements, modified as follows: CONTRACTOR shall prepare, as soon as practicable, a definitive schedule of major equipment, indicating: - Items required and quantity of each - Need dated




5. PROCUREMENT - Anticipated Site durations - Anticipated Cost CONTRACTOR shall solicit competitive bids from equipment rental sources, consistent with schedule of equipment requirements. CONTRACTOR shall develop and submit for EMPLOYER’s approval necessary bid tables and recommendation. In any event, EMPLOYER will retain option of inspecting the Contractorfurnished equipment and those ones it deems appropriate. C. Subcontracting 1.

Scope of Services CONTRACTOR shall perform all necessary subcontract strategy, planning, development, award, implementation, and administration required to accomplish subcontracted work (including procurement of agency services) for which CONTRACTOR is responsible under the Contract. CONTRACTOR shall prepare all required price estimates to be used as the basis for analysis of subcontractors' bids for subcontractor work packages and as the basis for negotiating subcontract changes and claims.

2.

Procedures Contractor shall develop and implement subcontracting procedures that satisfy EMPLOYER's requirements for subcontracting.

3.

Planning and Development a.

Within three (3) months after initiation of Contractor's preliminary engineering work but no later than three (3) months prior to any subcontract bid solicitation activity, Contractor will prepare and submit to EMPLOYER for approval a Master Subcontracting Plan. This plan will: • Identify with explanation those portions of the project which Contractor proposes to subcontract and indicate intentions for non-subcontracted work; • Set scope and limits intended for each proposed subcontract work package;




5. PROCUREMENT • Describe overall subcontracting strategy, philosophy to be followed for the project;

policy,

and

bidding

• Establish a coordinated schedule to reconcile proposed subcontracted work with the project schedule; • Contain an outline of CONTRACTOR's proposed Project Subcontracting Specifications together with itemization of any significant anticipated deviations from EMPLOYER's subcontracting requirements. CONTRACTOR will periodically review and update approved Master Subcontracting Plan until all work to be subcontracted has been awarded. b.

Within thirty (30) days after approval of the CONTRACTOR's subcontracting plan and at least thirty (30) days prior to any subcontract bid solicitation activity, CONTRACTOR shall prepare, and submit to EMPLOYER for approval, Project Subcontracting Specifications. These specifications are supplemental to the Master Subcontracting Plan and will contain: • Comprehensive description of Contractor's organization and staffing to carry out subcontractor selection and subcontract administration including duties, responsibilities, authority, and interfaces of proposed staff; • Detailed procedures (including flowchart and schedule criteria) for bid solicitation, bid receipt, bid review and subcontract award; • Detailed procedures for carrying out subcontract administration (e.g. preparation of field administration plan and audit program for each subcontract); • Specific project subcontracting ground rules covering such items as qualification of bidders, personnel screening, planning and scheduling coordination requirements, reporting, etc. (Without jeopardizing quality and schedule, preference shall be given to local subcontractors); • List of construction facilities available to subcontractor(s), indicating source, and on what basis; • Definition of procurement responsibilities/interfaces;




5. PROCUREMENT • Subcontract terms and conditions, subcontract language tailored to the project, and other standard bidding documents such as information and instruction to bidders, etc.; • Subcontract change provision information; • Recommended bidders' lists (firm, tentative, or subsequently developed) for each proposed subcontract package. (EMPLOYER's review and designation procedure will be consistent with that in III.A). c.

4.

CONTRACTOR shall carry out all subcontracting activities in strict accordance with the Master Subcontracting Plan and the Project Subcontracting Specifications, approved by EMPLOYER.

Source and Qualification of Subcontractors a.

EMPLOYER will enclose herein, a listing of qualified subcontractors for the work as shown in Exhibit 5-3.

b.

Subcontracts may be solicited from any acceptable source in the World Open Market, subject to EMPLOYER's prior written approval.

c.

Acceptability of any potential subcontractor will be based solely upon commercial, technical, project execution, safety performance, and financial considerations.

d.

When selective bidding is used, CONTRACTOR will pre-qualify all bidders. Pre-qualification requires that CONTRACTOR confirm (and be able to support such confirmation to EMPLOYER's satisfaction) that a potential bidder is: • Financially sound, • Fully competent to carry out proposed subcontracted work, and • Generally willing to accept proposed subcontract terms and conditions including type of contract (i.e., fixed price, unit price, etc.), and • Free from potential conflict of interest implications as in III.A.3. • Meets or exceeds EMPLOYER’s Health, Safety and Environmental requirements. CONTRACTOR shall confirm the acceptability of subcontractors and agencies to be employed by its own subcontractors and by Supervised




5. PROCUREMENT Contractors (See Project Instruction 11 – Responsibility for Other Contracts). 5.

Competitive Bids Except where only a single source is available, all subcontracts shall be based on competitive bids from three or more acceptable subcontractors. Subcontracts may be awarded without formal competition, for change in scope or for inclusion of significant additional work, only with prior approval of EMPLOYER's Project Manager.

6.

Content and Distribution of Subcontract Inquiry a.

7.

Inquiry documents shall consist of: •

Information to bidders,

•

Job Specification (including Project Instructions),

•

Agreement/General Provisions (Terms and Conditions),

•

Proposal Form (including closed bid package).

b.

Documents must meet all Project Subcontracting Specifications requirements, conform to the Master Subcontracting Plan and schedule, and be compatible with Contract between EMPLOYER and CONTRACTOR. All of EMPLOYER's rights under the Contract must be preserved. Any exceptions to the requirements of this Paragraph must be specifically approved by EMPLOYER’s Project Manager or to release of the subcontract.

c.

Inquiry "packages" which meet the foregoing requirements may be normally released to bidders without any the EMPLOYER’s approval. However, Project Manager will designate specific inquiries which cannot be released without prior approval.

d.

Complete copies of all subcontract inquiry "packages" (including a list of bidders’ names and addresses) are to be provided to EMPLOYER’S Project Manager at the same time they are issued to bidders.

Fair Price Estimate A fair price estimate will be prepared for all subcontracted work including subcontract changes and claims.




5. PROCUREMENT Depending upon the anticipated dollar value of a particular subcontract, fair price estimate may take form of: -

A reasonable cost range,

-

An estimate derived from the Control Estimate, or

-

A detailed cost estimate prepared independently from the Control Estimate.

EMPLOYER's Project Manager will specify what form of estimate will be acceptable when anticipated dollar value change a lot. CONTRACTOR will exercise same degree of security for fair price estimates as required for handling bids to which estimates apply. 8.

Closed Packages Bid Procedure For subcontractor inquiries the following closed packages bid procedure shall be used. The procedure may also be invoked by Project Manager for special cases of lower value whenever the Project Manager judges that such procedures are justified. Inquiry documents will include a closed bid package, and will describe in detail: - Use of closed bid package; - How proposals must be delivered, to whom, and when, and - Separation of closed bid information (i.e., commercial terms) from technical and project execution aspects of proposal. Closed price bids will be received by CONTRACTOR, deposited in a secure location, and remain under Contractor's care, custody and control until formal bid opening. Closed priced bids package will be opened only on the bid due date unless all bids have been received earlier and EMPLOYER's Project Manager agrees to an earlier opening. Once closed packages have been opened, any bids subsequently received shall be ignored for any award consideration. CONTRACTOR will take all necessary measures to maintain security of closed bids packages.




5. PROCUREMENT 9.

Subcontract Award Recommendation a.

When CONTRACTOR has completed its bid analysis, it will prepare and submit to EMPLOYER a Subcontract Award Recommendation. EMPLOYER will accept or reject within five (5) days after the Contractor submits its recommendation.

b.

The Subcontract Award Recommendation shall contain following:

c.

•

Statement recommending subcontract award to a specific bidder;

•

Summary statement in support of recommendation;

•

Commercial analysis;

•

Summary and analysis, if required, of any non-commercial (e.g., technical, project execution, or risk considerations) factors (e.g., Health, Safety, and Environmental) which affect bid evaluation;

•

Any proposed deviations from the Master Subcontracting Plan or the Project Subcontracting Specifications;

•

Comparison of projected total cost and schedule versus the price estimate, Control Estimate, and project schedule. Any significant deviation is to be explained.

•

A field Administration Plan for the proposed subcontract;

•

Confirmation of proposed subcontractor's commercial, technical, and financial acceptability;

•

Any special features and considerations.

As a general policy, subcontract award will be made to that Bidder who will afford the best technical - economical proposal to EMPLOYER considering all economic factors including price and other commercial terms, risk considerations, performance, schedule, previous experience, availability of competent personnel, and other technical considerations.

10. Field Administration Plan a.

CONTRACTOR will prepare and submit for EMPLOYER's approval a Field Administration Plan for each subcontract as in paragraph (10.b)




5. PROCUREMENT b.

The Field Administration Plan will contain the following: •

Name of person in Contractor's organization who is directly responsible for administering the subcontract;

•

Subcontract reporting requirements;

•

Audit program;

•

Details of work measurement and progress determination;

•

Subcontract close-out criteria (checklist).

11. Reporting a.

Subcontracts reporting will be an integral part of the project's overall cost/schedule control system. Level of detail to which subcontract elements are broken out and specifically identified shall comply with work breakdown structure and earned value requirements in Project Instruction 15.III – Measurement of Percentage Completion.

b.

In addition to subcontract reporting as defined above, CONTRACTOR will prepare, as a minimum, the following reports specifically related to subcontracting:

c.

•

Subcontract log;

•

Subcontract status (pre-award);

•

Subcontracting Schedule (pre-award);

•

Invoice and payment summaries.

Reports may be numerical, geographical, descriptive, or a combination thereof.

D. Expediting CONTRACTOR shall be responsible for expediting all material and equipment purchased by CONTRACTOR and its subcontractors. (Per Section II.A this responsibility includes those purchases initiated by EMPLOYER.) Accordingly, CONTRACTOR shall submit prior to Agreement Signature, for EMPLOYER’s review and comment, its standard expediting procedures which CONTRACTOR shall amend as EMPLOYER’s Project Manager deems necessary to comply with EMPLOYER requirements as follows:




5. PROCUREMENT 1. Functional Scope a. Document Control CONTRACTOR shall expedite across the CONTRACTOR/vendor (and subcontractor) interface all purchase order related documentation including but not limited to: •

Purchase order revisions, including vendor change quotations;

•

Detailed engineering drawings and calculations;

•

Fabrication procedures;

•

Installation instructions;

•

Operating and maintenance manuals;

•

Spare parts data;

•

Vendor orders to subvendors;

•

Invoices;

•

Order Execution Program status reports and updates.

b. Time Management Contractor shall insure strict and continuing adherence to vendor's Order Execution Schedule as established at order placement. (Where Contractor is drawing upon the support of its subsidiary offices, it shall determine that these offices are provided with all necessary documentation to provide this support.) c. Quality Management Contractor shall establish that the requirements of Quality Management (Project Instruction 4) pertaining to procurement are understood and followed by its expediters and vendors that vendor's delivery date(s) accommodate time required for inspection. 2. Functional Mechanism a. Prior to issuing a purchase order for any material or equipment item, Contractor shall prepare and submit to EMPLOYER’s Project Manager for approval its proposed expediting plan for said order.




5. PROCUREMENT b. Upon issue of each purchase order, revision or amendment, or a letter of intent to purchase, CONTRACTOR shall initiate a continuing series of vendor and subvendor visits, the number and frequency of which shall be consistent with the order's criticality. Although they may provide supplementary contact, substitution of telephone advice or vendor advice regarding suborders as a primary means of control is unacceptable. c. CONTRACTOR shall expedite all vendor documents and data as defined in Section III.D. CONTRACTOR shall assign an individual to its project team with the complete responsibility for expediting, logging, and reporting receipt, status, and transmittal of said information. (This control shall be evidenced by means of the Vendor Print Log per Project Instruction 7, Section III.B.2 – Document Control). d. CONTRACTOR, through its vendors, shall maintain full and complete control over activities of subvendors by: •

Obtaining full particulars of suborders including factory addresses, reference numbers, and delivery schedules;

•

Determining that programmed deliveries of said suborders are compatible with vendor's Order Execution Program;

•

Insuring that subvendors use only materials from approved sources and that the relevant provisions of Project Instruction 4 – Quality Management are satisfied.

e. CONTRACTOR's expediting group shall anticipate impending delays in critical equipment, advising CONTRACTOR's Project Manager. CONTRACTOR's Project Manager shall immediately contact EMPLOYER’s Project Manager, advising of the problem and the status of remedial action. f.

CONTRACTOR shall monitor production to identify and resolve potential scheduling problems due to material unavailability. Should substitute materials be required, CONTRACTOR shall secure prior EMPLOYER’s approval.

g. Assistance of vendor's senior management shall be solicited as required to maintain compliance with quality and schedule requirements of the order.




5. PROCUREMENT 3. Control Reporting a. Expediting Reports •

An expediting report shall be prepared by Contractor's expediter and forwarded to EMPLOYER’s Project Manager within three (3) days of each visit or contact.

•

The report shall cover all information relevant to the order by addressing points in Exhibit 5-2 and noting latest delivery status and promised delivery. A marked-up copy of the order execution program shall be attached to document present status and shall be submitted to EMPLOYER’s Project Manager on a monthly basis or less often if required.

•

The report shall note, in particular, contact with vendor senior management as in D.2.g. above.

b. Material/Equipment Status (M/ES) Report •

CONTRACTOR shall produce Material/Equipment Status Reports on a monthly basis (or less often if required) for distribution per Exhibit 1-3. Said reports may be combined with the Purchase Order Record (POR) noted in III.B.5.b. The information contained in these reports shall be current within ten days.

•

The M/ES shall display the status of all purchased material and equipment and shall include highlights of the expediting reports in D.3.a. above.

•

Minimal content of the M/ES shall be: -

Purchase order number;

-

Description of item;

-

P.O. value

-

Vendor and source country;

-

Due dates and status of vendor drawings and data;

-

Date required at Site;

-

Original ex-works promised and present ex-works dates;




5. PROCUREMENT

•

-

Transportation details;

-

Port of export and vessel;

-

Port of entry;

-

Scheduled and actual sailing dates;

-

Scheduled and actual arrival dates;

-

Date and type of last vendor contact;

-

Listing of all suborders, including numbers, place of manufacture, and all other data as above;

-

Customs requirements.

CONTRACTOR shall be responsible for continually monitoring these reports to verify their accuracy and reliability. Verification checking of vendor-provided information must be undertaken on an ongoing basis by Contractor's expediting group.

E. Traffic 1. Traffic Terminology For overall consistency and clarity of communication, CONTRACTOR shall submit for EMPLOYER information, a listing of general traffic terms and commercial abbreviations used in international trade, freight, and insurance, as applicable to the project. 2. Functional Scope CONTRACTOR shall describe procedures to be employed and identify parties responsible for the traffic-related various tasks and activities including but not limited to: •

Compiling and consolidating information relating to movements of freight to and from the jobsite;

•

Conducting port survey;

•

Conducting a marine survey

•

Arrange and coordinate cargo movements at marshalling yards and points of shipment worldwide;




5. PROCUREMENT •

Obtaining charter and/or line tonnage for the transportation of freight to control and operate an economic and efficient service;

•

Contracting and monitoring freight forwarders;

•

Arranging for all required export/import and shipping documentation;

•

Ensuring proper and expedient customs clearance;

•

Maintaining proper and expedient customs clearance;

•

Monitoring contracts with a traffic content;

•

Keeping all participants informed of freight and vessel movements;

•

Maintaining costing records and schedules;

•

Contracting and supervising cargo handling Sub-contractors;

•

Maintaining OS&D records and arranging for processing of claims;

•

Specifications for export boxing.

3. Assembled Units All equipment covered by any resulting award shall be shipped in assembled units consistent with good shipping practice. When items must be disassembled for shipment they shall be match marked. All units and their containers shall be piece marked and show the award and item number. Machined and other unpainted surfaces shall be fully protected from impact and weather damage with all holes and nozzles plugged or covered. Protection provided shall be suitable for extended outdoor storage. 4. Contractor Departmental Interfaces Contractor shall define all interfaces between its traffic department and the various other functions within its organization (engineering, procurement, legal, etc.) describing the flow and content of information across each interface. 5. Traffic Management To adequately define the scope of traffic management efforts, Contractor shall identify: a. The various parties who will be interfacing within each effort, and




5. PROCUREMENT b. By means of schematic presentation, the various possible worldwide freight routes (air, land, and sea) to project Site from which will be selected the most time effective for each shipment. 6. Traffic Documents Contractor shall identify, by description of format and content and by definition of preparation responsibility, all traffic-related documents to be employed on the project including but not limited to: •

Purchase Order;

•

Pro Forma Invoice;

•

Vendor's Commercial Invoice and Certificate of Origin;

•

Vendor's Packing List;

•

Export Declaration;

•

Consular Certification;

•

Ocean Bill of Lading;

•

Ship’s or Plane’s Manifest;

•

Stowage Plan;

•

Air Waybill;

•

Insurance Declaration;

•

Notice of Claim;

•

Overage, Shortage or Damage Report;

•

Container Content List;

•

Master Voyage Summary Report;

•

Weekly Shipping Schedule;

•

Various Communications.

7. Freight Forwarders (Forwarding Agents) In selecting forwarding agents for this project, CONTRACTOR shall: International Bidding Process N° PCI-002-2008-OFP/P ETROPERU



5. PROCUREMENT a. Comply fully with the applicable portions of Subcontracting requirements (See Section III C of this instruction); b. Define duties and responsibilities of each forwarding agent vis-a-vis the responsibilities of its own traffic department. 8. Insurance CONTRACTOR shall define the responsibilities, function and interfaces within its own traffic department for executing procedures set forth in Project Instruction 10 – Finance and Insurance, Section D. 9. Customs CONTRACTOR shall define the duty status of imported equipment and materials, describe necessary custom documents and processing thereof, and define areas of interface between Customs, Company and Contractor. 10. Flow of Freight and Documentation CONTRACTOR shall outline (using schematic presentation) the flow of freight, documentation, responsibilities, and interfaces related to transporting equipment and materials from source to Site. F. Spare Parts This section addresses specific portions of procurement relating to Contractor's responsibilities for spare parts, and in particular, those of Category III - Parent Equipment Spares. (Contractor shall appoint a spare parts coordinator who shall be held accountable for the satisfactory discharge of these responsibilities which shall take precedence over any other of the coordinator's assigned duties). 1. Definitions a. Category I - Designated Spares Spare parts required by EMPLOYER - provided pursuant to Basic Design Specification/General Engineering Specification and special operating maintenance tools not within the scope of the parent equipment purchase order. b. Category II - Construction Spares Required for putting equipment in order immediately prior to turnover to EMPLOYER. (As such items will be replacements for those damaged/lost by Contractor or its subcontractor during construction, Contractor shall note




5. PROCUREMENT that it is not Company's intent to support Contractor's activities by providing said items from Company's stock). c. Category III - Parent Equipment Spares Spares (other than those items of Category I) which are required to support one or two years of continuous operations. Items so included are those: Subject to normal wear, erosion, or corrosion; Critical to equipment/facilities operations; Subject to breakage during normal inspection/maintenance. All parent spare parts will be tagged with EMPLOYER’s stock code numbers and identified in a separate sequence of purchase order numbers. CONTRACTOR will provide priced purchase orders for all spare purchase orders. d. Category IV - Bulk Material Spares Bulk materials intended for warehouse stock including such items as: •

Electrical material - conduct, cable, fittings, etc.

•

Piping material - pipe, valves, fittings, etc.

•

Instrumentation material - cable, tubing, etc.

2. Responsibilities and Procedural Requirements CONTRACTOR shall be responsible for procuring all Category I, II, and III spares as above. Said spares shall be physically present at Site as a prerequisite for Mechanical Completion. (EMPLOYER shall be responsible for procuring all Category IV spares.) Accordingly, CONTRACTOR shall develop and review with C EMPLOYER procedural mechanisms needed to discharge Contractor's responsibilities. (Contractor shall address, in particular, soliciting/receiving Category III spare recommendations/ quotations concurrently with quotations for parent equipment items). Said mechanisms shall cover the following: • Reviewing inquiries to vendors to ensure coverage regarding spare parts recommendations/quotations;




5. PROCUREMENT • Follow-up with vendors for timely spare parts recommendations, quotations, and delivery times; • Tabulating vendor recommendations and quotations for spares; • Reviewing said recommendations and compiling from them consolidated lists of interchangeable and frequently occurring parts; • Forwarding spare parts recommendations for Company review on an "assoon-as-available" basis; • Controlling spare parts procurement status and reporting same via the Materials/Equipment Status Report (M/ESR) and the Spare Parts Control Log (SPCL); • Ordering, expediting, receiving, and storing all spare parts for which Contractor is responsible. 3. Category III - Spare Parts Selection Criteria and Considerations Following criteria and considerations shall form the basis from which Contractor reviews its own spare parts queries, evaluates vendor recommendation/quotations, and develops recommendation summaries for EMPLOYER. When needed, the basis shall be suitably altered to accommodate additional equipment and/or criteria. a. Equipment Spare Part Selection Criteria 1. Equipment Requiring One Year Operational Support Items contained in Exhibit 5-1 as follows: •

Mechanical Equipment (excluding A.7, 10, 14, 15, 16)

•

Electrical Equipment

•

Instrumentation

2. Equipment Requiring Two Year Operational Support Items contained in Exhibit 5-1 as follows: •

Mechanical Equipment (only A.10, 14, 15)




5. PROCUREMENT b. Spare Parts Considerations Criticality of equipment item, process unit, etc.; •

Sources of parts supply and means of transportation vis-a-vis plant location;

•

Delivery lead times required for parts;

•

Sparing philosophy for equipment components;

•

Possible parts stock consignment with major vendor(s).

4. Purchase Inquiry Requirements for Spare Parts a. Inquiry Content Delivery Date* for all requested complete parts lists, recommendations and quotations for special tools and/or Category III spare parts including firm (90-day validity after receipt of order) commitments for the recommended spares; Required number of spare part quotation copies to be submitted with vendor proposals; EMPLOYER's equipment number list. *

Contractor shall use its best efforts to cause bidders to include this information with their bids for the parent equipment. In any event, quotations for designated spares must be included with parent equipment bid receipt.

b. Instructions to Bidders Submit, using EMPLOYER's equipment number list, the parent item name and description for which a spare part is recommended. For each equipment item provide a complete parts list or assembly drawing featuring for each recommended spare part: -

Description (including material) and vendor serial/prime source numbers;

-

Unit and shipping weights;




5. PROCUREMENT -

Identification as either specialty or stock and if the latter, location where stocked and delivery times for normal and emergency situations.

Provide composite list of spare parts replacements detailing the frequency with which recommended spare parts occur within the vendor's equipment items and the number and nature of such parent items to be supplied by the bidder. Specify the quantity, unit price, and total price of each recommended spare part plus target scheduled delivery date(s). (Said date(s) should preferably be concurrent with parent equipment delivery date(s) and in no circumstance, later than six weeks prior to unit mechanical completion). 5. Recommended Spare Parts Summaries Within fifteen (15) days of receipt of recommendations/quotations, Contractor shall prepare and present to EMPLOYER for review and modification recommended spare parts summaries as follows: −

Summary by hardware group of each vendor's recommendations to provide a total for each identical spare part recommended. Said compilations shall reflect Contractor's considered judgment regarding completeness of coverage for spare parts requirements.

−

Copies of the selected vendor's recommended spare part quotations with relevant Contractor remarks or recommendations.

−

Estimate of the probable need to replace the parts, and an assessment of their interchangeability.

6. Spare Parts Procurement Control CONTRACTOR shall ensure that spare parts requirements have been addressed for each piece of parent equipment, and where spares are required, to rigorously control their procurement. CONTRACTOR shall prepare a Spare Parts Control Log (SPCL) which, following initial release, shall be issued monthly or more often per EMPLOYER direction. Although final development of the SPCL tabulation format will require EMPLOYER consultation, following are the minimum required components: − Parent equipment purchase order number for every piece of equipment whether or not spares are required,




5. PROCUREMENT − Description of parent equipment item and equipment item number, − Equipment vendor, − Indication whether or not spare parts are required, − Description of recommended spare part with vendor serial number and prime source number, − Dates of receipt of vendor recommendation and subsequent transmittal of the summary for review by EMPLOYER’s Project Manager, − Date of summary return from EMPLOYER, − Order number and placement date for spare part, − Original and revised promised delivery dates, − EMPLOYER stock code.




PROCUREMENT EXHIBIT 5-1 EQUIPMENT/MATERIAL CATEGORIES REQUIRING SOURCE APPROVAL A.

Mechanical Equipment 1.

2.

3.

4.

f.

Crushers, Grinders and Shredders

Atmospheric Tankage (including internals)

g.

Extruders

a.

Storage Tanks

h.

Pelletizers

b.

Bins

i.

Printing Equipment

c.

Atmospheric Reactors

j.

Thermoforming Equipment

d.

Kettles

k.

Weighing Equipment

Blowers and Fans a.

Axial

b.

Centrifugal

5.

Heaters (including internals) and Stacks a.

Boilers (itemize by Type and Service)

Compressors

b.

Electric Furnaces

a.

Axial

c.

Flare Stacks

b.

Centrifugal (itemize by Service/Type)

d.

Free-Standing Steel Stacks

c.

Reciprocating (itemize by Service and HP)

e.

Process Heaters (itemize by Type and Service)

d.

Special

f.

Rotary Kilns

g.

Special Features

h.

Vertical Kilns

Forming, Packaging and Proportioning Equipment a.

Bagging Machines

b.

Batching Machinery

c.

Box Forming Machinery

d.

Briquetting Machines

e.

Compactors




PROCUREMENT EXHIBIT 5-1 EQUIPMENT/MATERIAL CATEGORIES REQUIRING SOURCE APPROVAL 6.

7.

Heat Exchange Equipment

l.

Mechanical Drivers (including Drive Trains and Gearing)

a.

Air Cooled Heat Exchangers

b.

Barometric Condensers

m. Engines (itemize by Type & HP)

c.

Cooling Towers

n.

d.

Dryers

Expanders (itemize by Type & HP)

e.

Evaporative Coolers

o.

Turbines (itemize by Type & HP)

f.

Shell and Tube Heat Exchangers

g.

Tank Heaters

h.

All other Heat Exchangers

8.

Mechanical Handling Equipment a.

Catalyst Handling Equipment

b.

Conveyors and Elevators

Marine Technical Equipment

c.

Cranes and Hoists

a.

Bollards

d.

Drag Lines

b.

Buffers

e.

Travelling Grates

c.

Capstans

d.

Cleats

a.

Blending Units

e.

Couplers

b.

Desalters

f.

Dolphins

c.

Inert Gas Generators

g.

Gangways

d.

Refrigeration Plants

h.

Hoists

e.

Sulfur Plants

i.

Hose

f.

All Others

j.

Loading Arms

k.

9.


Single Buoy Mooring




PROCUREMENT EXHIBIT 5-1 EQUIPMENT/MATERIAL CATEGORIES REQUIRING SOURCE APPROVAL 10. Pressure Vessels (including internals)

9.

Skimmers

10. Vibrating Screens a.

Convertor C.

b. c. d. e.

Special Plants

Drums 1.

Caustic and Chlorine Cells

2.

Hydrochloric Acid

3.

Phosphoric Acid

4.

Sulfuric Acid

5.

All Others

Reactors Storage (Pressure) Towers

11. Pumps a.

B.

Centrifugal (itemize by Service)

D.

Waste Treatment Equipment

b.

Cryogenic

1.

Disposal System

c.

Proportioning (itemize by Service)

2.

Incinerators

3.

Separators – API

4.

Filters

d.

Rotary

e.

Special Services

Separating and Mixing Equipment 1.

Agitators and Mixers

2.

Centrifuges

3.

Cyclones

4.

Dispersers

5.

Dust Collectors and Filters

6.

Mills (all)

7.

Precipitators

8.

Scrubbers

E.

Water Treatment Equipment 1.

Chlorinators

2.

Dearerators

3.

Feeders

4.

Filers

5.

All Others




PROCUREMENT EXHIBIT 5-1 EQUIPMENT/MATERIAL CATEGORIES REQUIRING SOURCE APPROVAL F.

G.

Vacuum Equipment 1.

Ejectors

2.

All Others

H.

Instrumentation Equipment/Materials 1.

Instruments – Local (itemize by Type)

Electrical Equipment/Materials

2.

Instruments – Panel Board

1.

Circuit Breakers (itemize by Voltage

3.

Instrument Panel Board Only

4.

Relief Control Valves

2.

Conduit and Fittings 5.

Stream Analyzer

3.

Distribution Feeders 6.

4.

Fire Alarm Equipment

Distributed Control System and Components

5.

Generators (itemize Rating and Voltage)

and

Paging I. by

Insulation and Lining Materials

KV 1.

Castable Linings

6.

Grounding Cable and Devices

2.

Equipment Insulation (Cold)

7.

Lightning Arrestors

3.

Equipment Insulation (Hot)

8.

Main Switch Panel

4.

Piping Insulation (Cold)

9.

Motors (itemize by Voltage)

5.

Piping Insulation (Hot)

10. Push Buttons and Relays

6.

Refractories

11. Starters

7.

Fireproofing

12. Switches 13. Telephone and Intercommunication Equipment 14. Transformers and Transformer Substations 15. Warning Devices Gongs, Klaxons, etc.)

(Bells,




PROCUREMENT EXHIBIT 5-1 EQUIPMENT/MATERIAL CATEGORIES REQUIRING SOURCE APPROVAL k. J.

Other Equipment/Materials

Pipe and Piping Materials (Not above) 1.

Aluminum

2.

Carbon Steel

3.

Cast Iron

4.

Ceramic

5.

Copper

6.

Glass

7.

High Alloy

8.

Large Ducts

9.

Lead

10. Lead Lined 11. Plastic 12. Plastic Lined 13. Reinforced Concrete Pipe 14. Rubber 15. Rubber Lined 16. Transite 17. Pipe Hangers, Rollers, Etc. (Excludes Major Support Structures) 18. Valves, Fittings, Flanges (All Materials And Types) 19. Expansion Joints


1. Confirm engineering responsibility 2. Review projected and actual engineering against approved order execution program.

Detailed Engineering 1. Review approval requirements for: 2. Drawings 3. Calculations and data 4. Spare parts with prices 5. Suborders 6. Fabrication procedures including welding 7. Confirm vendor’s understanding

1. Confirm vendor’s receipt of order 2. Confirm vendor’s understanding of order requirements 3. Resolve vendor queries, if any

STEP 2

1. Ascertain status of vendor submittals 2. Resolve problems, if any

1. Secure vendor’s shop order or production order number for reference

STEP 3

EXHIBIT 5-2 EXPEDITING GUIDELINES

PROCUREMENT


1. Review Purchase Order for completeness/clarity 2. Date placed 3. Date required 4. Date promised 5. Complexity/criticality of order 6. Packing/shipping instructions 7. Import/export licensing

STEP 1

Initial (Post Order Placement)

VENDOR ACTIVITY STAGES


1. Confirm release of fabrication drawings to shop or establish projected due date 2. Review against order execution program

1. Confirm vendor’s understanding/appreciatio n of specification requirements. 2. Resolve vendor queries, if any. 3. Review and advise vendor of inspection requirements as applicable

STEP 4

1. Ascertain if order ready for release for fabrication 2. Determine/resolve delays in release

1. Review vendor’s order execution program as approved at issuance of purchase order

STEP 5


1. Confirm issuance of bill of material or establish projected issuance date 2. Confirm material in stock availability or establish projected receiving date 3. Obtain production schedule and review against order execution program 1. Establish production start date 2. Ascertain estimated fabrication time and review against the order execution program 1. Establish present number of shifts engaged and hours worked 2. Ascertain potential benefits of cost/time tradeoffs 1. Confirm availability and vendor’s understanding of packing/shipping instructions 2. Determine date for forwarding invoice and packing lists

STEP 1

1. Determine the necessity for contacting vendor’s senior management to resolve problems and proceed as required. 1. For critical shipment, require vendor to maintain shipment trace and report status

1. Ascertain shipment release date 2. Confirm shipment and routing 1. Confirm availability of packing and crating materials

1. Confirm invoice date and number inclusion on export orders

1. Confirm vendor’s understanding of inspection requirements for main unit and auxiliary equipment

1. Review status of auxiliary and accessory items to accompany unit

STEP 5

1. Pressure vendor to expedite critical suborders

1. Ascertain potential or actual material shortages and expedite production start

1. Ascertain status of critical development functions, e.g., casting patterns 2. Review against order execution program

STEP 4

1. Investigate possibility of substitutions

1. Identify any potential problems

1. Confirm early ordering of critical material or establish projected order date. 2. Review against order execution program

STEP 3

VOLUME 2 PROJECT INSTRUCTIONS TO PART C SERVICES AND DELIVERABLES - FEED & EPC MASTER JOB SPECIFICATIONS PAGE 37 OF 38 Exhibit 5-2 Page 2 of 2 DATE: JULY 11, 2009

1. Ascertain and detail possible interference from other orders

1. Establish main unit and auxiliary equipment production and shipping schedules

1. Secure ordered materials’ suborder numbers and schedules 2. Determine which suborders will require intensive expediting efforts

STEP 2

EXHIBIT 5-2 EXPEDITING GUIDELINES

PROCUREMENT


Shipping

Production Recovery (As Applicable)

Production

Pre-Production

VENDOR ACTIVITY STAGES




PROCUREMENT EXHIBIT 5-3 LISTING OF QUALIFIED SUBCONTRACTORS




6. MATERIAL CONTROL I.

OBJECTIVE This instruction covers the requirements of CONTRACTOR'S material control as follows: •

Bulk Materials,

•

Field Material Control,

•

Equipment Protective Maintenance,

•

Surplus Materials.

II. GENERAL REQUIREMENTS A. Bulk Materials Prior to initiating bulk material purchases, CONTRACTOR shall submit for EMPLOYER’s review and approval its proposed home office bulk material control procedures for the project. Said procedures, in conjunction with CONTRACTOR's field material control procedures, shall fully address limitation of underruns in orders for all bulk materials – thermal insulation, electrical, piping, etc., as follows: 1. Upon EMPLOYER approval of the respective portions of the Control Estimate, Contractor shall place purchase orders in compliance with Site material requirements. Said purchase orders shall contain reasonable allowances for wastage and loss. 2. CONTRACTOR shall continuously compare ordered, on hand, and actually required quantities (as per process design drawings) and shall immediately undertake corrective action to preclude material shortages and surpluses. CONTRACTOR shall summarize and issue monthly (or more often if required by EMPLOYER) information generated by this monitoring in the form of bulk material status reports. 3. Contractor shall supplement the continuous monitoring effort in II.A.2 with formal material takeoffs reports and formal summaries when Project engineering is 50% and 90% complete. The requested information is to verify the state of the bulk material which shall be used in the preparation of the first 1 costs estimates of the Project .

1





6. MATERIAL CONTROL B. Field Material Control Prior to initiating purchases of bulk materials and engineered equipment, CONTRACTOR shall submit for EMPLOYER’s review and approval its recommended field material control procedures (if applicable). Said procedures shall completely define field or warehouse material control activities, (particularly for materials or equipment requiring special attention) from receipt to final disposition, and shall satisfy following minimum requirements: 1. Receiving and Inspection (if applicable) a. Immediately upon receipt of materials and/or equipment at Site, CONTRACTOR shall perform inspections to establish what has been received and assess the condition thereof. Inspections of large equipment or technically complex items shall be undertaken by CONTRACTOR's field engineering function. b. CONTRACTOR shall subsequently prepare material and/or equipment receiving reports to completely identify the items and their disposition. Overages, shortages, and damaged items shall be noted in a separate report. 2. Warehousing, Stock Records, and Inventory Control a. All stored materials shall be properly segregated, identified, marked, tagged, and protected from physical damage, weather, and theft. It should be noted that EMPLOYER will not provide dedicated security on Site for any material loss protection or other Project specific purpose, and that any requirements CONTRACTOR determines are required are to its account and under its control. Any security measures or procedures CONTRACTOR intends to provide will need to be submitted for EMPLOYER’s review and approval. b. Stock control sheets (e.g., Kardex, Bar Coding) shall be properly maintained for unallocated materials in storage and shall reflect receipts and issues on a daily basis. Periodic checks shall be undertaken to verify actual physical inventory against stock records. Frequency of said checks shall be determined by EMPLOYER's Project Manager. c. All material issues shall be made only by proper requisition/transfer documentation which must include: −

Cost coding,

−

Field planning work order number,

−

Authorization.




6. MATERIAL CONTROL d. All returns to Vendors and deliveries to or withdrawals from scrap and salvage yards shall require the same degree of control as material issues. e. CONTRACTOR’s field material control system will describe how all material issued from warehouse will be tracked/controlled in the field (includes equipment and all bulks, i.e., valves, pipe spools, cable reels, etc.) until physically installed in field. System will define protection, storage, location, and responsible parties for each of the Material Control functions/activities, including removal of equipment, material or tools for testing and/or repair. C. Equipment Protective Maintenance Prior to receipt of processes equipment, CONTRACTOR shall submit for EMPLOYER’s review and approval its proposed procedures for adequately protecting and maintaining project equipment from date of Site arrival until its final installation. Minimum requirements for these procedures follow: 1. Responsible Party (if applicable) CONTRACTOR shall identify by name the person who will be responsible for maintaining each equipment. Said responsibility will cover the entire period from receipt through construction completion. CONTRACTOR's field engineering function shall audit on a regular basis the performance of these responsible parties. 2. Program Content a. CONTRACTOR's protective maintenance program shall include but not be limited to: •

Periodically turning shafts in rotating equipment,

•

Checking the lube oil levels and cleanliness,

•

Temporary installation of lube mist systems during transit, site storage, and while placed waiting for installation of ancillary hardware,

•

Checking equipment requiring desiccant’s and/or inert gas blankets,

•

Verifying dry storage and/or controlled environment requirements of instruments and electrical equipment,

•

Verifying space heater hookup in electrical motors,




6. MATERIAL CONTROL •

Storage/protection of relief valves, control valves, hand valves, electrical junction boxes, cable, and other project hardware requiring prudent care and custody,

•

Maintaining protective covers or disks on flange surfaces,

•

Protection of equipment and continuance of protective maintenance of equipment setting on permanent location, while continuing construction of ancillary facilities, up to checkout and handover of equipment and facilities to EMPLOYER.

b. All protective maintenance functions shall be logged to include date, signature of responsible party, and inspection comments and action. D. Surplus Materials CONTRACTOR's proposed procedures for disposal of surplus materials shall be submitted to EMPLOYER's Project Manager for review and comment. CONTRACTOR shall amend the procedures as EMPLOYER's Project Manager deems necessary for compliance with EMPLOYER Requirements. CONTRACTOR shall promptly advise EMPLOYER’s Representative for a decision when there are surplus for all materials and equipment.




7. DOCUMENT CONTROL I.

OBJECTIVE This instruction addresses Project Document Control requirements to be satisfied by Contractor.

II. GENERAL REQUIREMENTS CONTRACTOR shall provide copies of “indexes” for all CONTRACTOR’s manuals, standard drawings, specifications, and procedures in order to know in a preliminary way the scope and characteristics of the Contractor’s documents management system based on its experience in the development of similar projects. Confidentiality of these documents is according to number III E – Proprietary Information, of the Project Instruction 7 – Document Control. CONTRACTOR shall provide these documents as part of the Information Management Plan, of the Project Execution Proposal described in Attachment 19 (Volume 1) of the Information to Bidders, so that EMPLOYER knows in a preliminary way the scope and characteristics of the CONTRACTOR’s documents management system based on its experience in the development of similar projects. Such information will be revised by the EMPLOYER, and will be used as a reference to verify the planning and the Project activities progress, and to confirm the 1 deliverables comply with the CONTRACTOR's standards and good practices . III. SPECIFIC REQUIREMENTS A. Construction Drawings 1.

Drawing Format and Control a. CONTRACTOR shall submit, for EMPLOYER's review and comment, its standard format(s) for every type drawing it proposes using for the Work. Said formats shall be modified as necessary to comply with EMPLOYER’s specific requirements. CONTRACTOR shall not produce drawings for the Work in any other format. b. Drawings shall be distributed in accordance with Exhibit 1-3 of the Project Instruction Nº 1 - Correspondence.

2.

Drawing Index a. CONTRACTOR shall submit for EMPLOYER's review and comment, the standard index for all drawings. CONTRACTOR shall modify said index as EMPLOYER’s Project Manager deems necessary. CONTRACTOR shall thereafter properly maintain said index for the life of the project.




7. DOCUMENT CONTROL b. The drawing index shall serve two functions: it shall be a listing of every drawing to be produced by Contractor and a control on the progress of drawings. Accordingly, the index shall clearly indicate: •

Title and number of the drawing;

•

Due date;

•

Start date and progress;

•

Completion, approval, release, and revision number and dates;

•

Engineering discipline and individual responsible.

B. Vendor Prints 1. Procedures a. Prior to initiating any activity related to receiving and processing drawings, calculations, and other technical data from Vendors, sub-Vendors, Supervised Contractors, and subcontractors under its control, CONTRACTOR shall submit its procedures for Vendor data control for approval by EMPLOYER’s Project Manager (See Project Instruction Nº 5, Section III.D.2.c. - Procurement). b. Said procedures shall require that Vendor data control be the responsibility of CONTRACTOR's Project team and not of an outside function. c. The procedures shall comply with the minimum requirements of the section D.2, hereto. 2. Vendor Print Log a. Contractor shall develop and maintain a Vendor print log which shall accurately index and control each technical document as in B.1.a above and shall be periodically submitted for EMPLOYER's review and comments. b. Said log shall be updated and issued monthly, or more frequently as directed by EMPLOYER’s Project Manager, in accordance with Exhibit 1-3 of the Project Instruction Nº 1 - Correspondence.

1

Questions 115 and 116 – Round 3




7. DOCUMENT CONTROL C. As-Built Drawings (as applicable) CONTRACTOR shall prepare as-built drawings reflecting field modifications to engineering flow diagrams (P&ID’s), electrical one-line diagrams, electrical schematic connection and interconnecting wiring diagrams, loop diagrams, dimensioned equipment layouts, and drawings including Vendor's and Subcontractor's drawings and diagrams of all underground installations and other work not normally visible such as vessel internals. Project Record Books, Equipment Reference File, and Operating Instructions shall all reflect as-built conditions (See Project Instruction Nº 18 – Compilation of Project Data). All of these drawings have to comply the minimum requirements mentioned in the section D.2, below. The CONTRACTOR must also submit the plans “as built” following the completion 2 of the construction and installation works . “As built” documentation of the existing facilities of the refinery will be available for the Successful Bidder at the beginning 3 of the Contract . D. Electronic Files 1. Recommendations and Procedures CONTRACTOR shall submit for EMPLOYER's review and comment the following: •

CONTRACTOR's recommendations regarding the extent of electronic files for drawings and other documents based on EMPLOYER's drawing requirements, project logistics, and Contractor's experience.

•

CONTRACTOR's proposed procedures for electronic files including preparation, distribution, and control, consistent with the recommendations above and the requirements of D.2.

2. Minimum requirements CONTRACTOR's requirements:

procedures

shall

address

the

following

minimum

a. Electronic File Indices An index shall be prepared for the overall plant and for each design specification unit or system. The index shall then itself become an

2 3

Question 207 – Round 1 Question 133 – Round 1




7. DOCUMENT CONTROL electronic file and will become the framework for compilation and retention of the electronic files for the overall plant and each design specification. b. Documents for Electronic Files Following are typical documents which shall be included in the electronic files and indexed for the overall plant and individual design specification units or systems: •

•

Overall Plant −

Overall plot plans with elevations and coordinates;

−

Overall site development drawings;

−

Plant process and utility flow diagrams;

−

Plant equipment list identified by design EMPLOYER's item number, and descriptions;

−

Overall environmental design criteria including all government requirements, approval procedures, testing methods, etc.

specifications,

Units or Systems −

Plot plans;

−

Process and utility flow diagrams including electrical one-lines;

−

P&ID's with pipes classification sheets;

−

All system diagrams;

−

Plans of principal pipe racks and all underground utilities and systems;

−

Unit or system equipment distribution by EMPLOYER's item number and descriptions;

−

Major equipment (heaters, boilers, pressure vessels, compressors, etc.), Vendor drawings, specifications, and data sheets including those for all internals;

−

Instrument panel layouts;

−

DCS configuration and connection diagrams;




7. DOCUMENT CONTROL −

Foundation and piling plans, foundation details for equipment, buildings, and structures;

−

Building plans and elevations;

−

Major structure (non-building) plans and elevations.

major

c. Electronic File Specifications All electronic files of “as built” drawings completed in electronic format shall be provided in either 3-D CAD files with all “attributes”, at a minimum as specified by EMPLOYER. Drawings shall be managed using a database system with integrated TM graphic platform (PDMS or similar). All the drawing, including the ones from the sub contractors and vendors shall be elaborated and issued using the same system. The FEED-EPC CONTRACTOR shall provide to the EMPLOYER, at the beginning of the FEED Phase, the software packages and at least three licensees in order to allow the EMPLOYER to review the drawings and diagrams developed by the CONTRACTOR. The EMPLOYER will communicate the FEED-EPC CONTRACTOR upon the definition of the offices location where the Engineering and Construction will take place and where the required licenses will be installed. It has been foreseen in a preliminary manner that at least one of the licenses shall be located at the offices of the EMPLOYER4. d. Electronic File Distribution Distribution of all electronic files shall be in accordance with Exhibit 1-3 of the Project Instruction Nº 1 - Correspondence. E. Proprietary Information 1. EMPLOYER Information CONTRACTOR shall submit, for EMPLOYER's review and comment, its standard procedures for handling proprietary information of others. Said procedures shall be modified by CONTRACTOR to comply with C EMPLOYER requirements and shall be subsequently applied by CONTRACTOR to:

4

Question 208 – Round 1




7. DOCUMENT CONTROL •

Safeguard all proprietary information supplied to it by EMPLOYER for the prosecution of the Work, and return same to EMPLOYER at the completion of the Work;

•

Disclose to subcontractors and Vendors, by means of properly executed confidentiality agreements, proprietary information necessary for the prosecution of the Work.

2. Upon EMPLOYER's request, CONTRACTOR shall also enter into confidentiality agreements with third parties to use the proprietary information of such third parties in prosecution of the Work. It is clarified that the EMPLOYER requirement is to provide “copies of indexes” of all CONTRACTOR´s information aforementioned, in order to know in a preliminary way the scope and characteristics of the CONTRACTOR’s documents management system based on its experience in the development of similar projects. Confidentiality of these documents is according to number III E – Proprietary Information, of the Project Instruction Nº 7 – Document Control. Such information will be revised by the EMPLOYER, and will be used as a reference to verify the planning and control of the Project activities, and to confirm the deliverables comply with the CONTRACTOR's standards and good practices. The requested information shall be submitted as part of the Information Management Plan of the Project Execution Proposal described in Attachment 19 of the Information to Bidders. Such proposal shall be submitted to the EMPLOYER as a requirement for the Contract Signature. F. File System 1. File Index CONTRACTOR shall submit, for EMPLOYER's review and comment, its standard project file index. Said index shall be modified as deemed necessary to comply with EMPLOYER requirements and project files shall be maintained in accordance with the index. CONTRACTOR will provide and maintain said index as an electronic file and update/issue it on a monthly basis, or more frequently as directed by EMPLOYER’s Project Manager, in accordance with Exhibit 1-1 to 1-3 of the Project Instruction Nº 1 - Correspondence. 2. File Access CONTRACTOR shall ensure reasonable access by EMPLOYER to CONTRACTOR's files. Where CONTRACTOR deems that such access would jeopardize proprietary file information, Contractor shall so advise




7. DOCUMENT CONTROL EMPLOYER’s Project Manager in writing, identifying the sensitive items for EMPLOYER's further consideration. G. Documentation 1.

Conference Notes a. CONTRACTOR shall submit for EMPLOYER's review and comment its standard conference notes format for documenting all meetings. CONTRACTOR shall subsequently modify said format as EMPLOYER’s Project Manager deems necessary to comply with project requirements. b. Said conference notes shall be action/responsibility oriented, identifying: •

Each item (specifically defined) requiring action,

•

The person (by name) responsible for the action,

•

When the action required shall be completed.

c. Within two (2) working days following all CONTRACTOR meetings with EMPLOYER or with Supervised Contractors, subcontractors, or with Supervised Contractors, subcontractors, or Vendors, CONTRACTOR shall prepare and issue the conference notes in accordance with Exhibit 1-1 to 1-3 of the Project Instruction Nº 1 - Correspondence. 2. Correspondence Log CONTRACTOR shall develop for EMPLOYER approval a log for registering transmission and receipt of all job-related correspondence. Said log shall be arranged both by subject and chronology, and shall clearly indicate all originators and addresses. It shall be presented for review when requested by EMPLOYER's Project Manager. Said log shall be provided and maintained in electronic format, and updated and issued on a weekly basis in accordance with Exhibit 1-3 of the Project Instruction Nº 1 - Correspondence. 3. Telephone and Email Documentation As set forth in Project Instruction Nº 1, Section III, all job-related telephone queries, agreements, and instructions shall be properly documented. Emails have to be controlled and distributed in accordance with requirements of Appendix 1-3 of the Project Instruction Nº 1 – Correspondence.




8. CHANGE CONTROL I. OBJECTIVE This instruction addresses requisites of Change control throughout the life of the project. PMC has to revise the CONTRACTOR’s Change Control Procedures for compliance, and provide EMPLOYER’s Project Manager with the analysis and recommendations so that some actions are improved and/or rectified. II. REQUIREMENTS Following are basic control requirements of Change Orders development and processing for this project: A. Procedural At the Contract Signature, CONTRACTOR shall submit for EMPLOYER’s review and comment its standard procedures for processing Changes including schematic presentations of change document flow. CONTRACTOR shall then modify these as necessary to comply with EMPLOYER requirements and document the Project procedures. Said procedure shall address: • Change proposal timing, • Change proposal content, • Change document distribution and authorization, • Change order monitoring and reporting. PMC has to check said procedures and provide the EMPLOYER with the respective recommendations for the improvement and/or correction to certain actions. B.

Timing 1. Within seven (7) calendar days of receipt of EMPLOYER's request for a Change proposal, CONTRACTOR shall submit said proposal. Should Contractor be unable to comply with this requirement, it shall promptly advise EMPLOYER's Project Manager substantiating the reason(s) for delay and advising of the date when said proposal shall become available. PMC has to monitor the CONTRACTOR for the compliance of the requirements of the EMPLOYER.




8. CHANGE CONTROL 2. For those situations where CONTRACTOR wishes to initiate a Change, CONTRACTOR shall advise EMPLOYER in writing prior to expending any work hours in estimating said Change. PMC has to check the CONTRACTOR’s Change Proposals for complying with the requirements and validity of the EMPLOYER and at the same time it has to provide EMPLOYER’s Project Manager with the recommendations for its disposition or approval. C. Change Proposal Content The Contractor's Change proposal (submitted as a Change Order draft) shall contain, as a minimum, the following information: 1. The Proposal Initiator (EMPLOYER or CONTRACTOR) 2. Reason(s) for Change (operability, maintenance, safety, environmental, engineering or construction errors by others, etc.). 3. Description of the Change with respect to facilities and services. 4. Impact on the Contract Price by reference to cost changes of specific components as directed by EMPLOYER's Project Manager. Said components shall include: a. Home and branch office costs, b. Direct material and labor costs, c. Subcontracts, d. Indirect field charges, e. Fee 5. Impact on Target Completion Date with supporting documentation. 6. Impact on the Project's utilities or process requirements, as applicable. 7. Definition of any impact upon CONTRACTOR's and Licensors’ guarantees. 8. Definition of the latest date for Company approval of the Change without affecting Target Completion Date.




8. CHANGE CONTROL PMC has to check the CONTRACTOR’s Change Proposals for complying with the requirements and validity of the EMPLOYER and at the same time it has to provide EMPLOYER’s Project Manager with the recommendations for its disposition or approval. D. Distribution and Authorization Following specific distribution and authorization requirements are to be observed: 1. Distribution - All Change documents, including both Change proposals and executed change authorizations, shall be distributed as per Exhibit 1-3 of the Project Instruction Nº 1. 2. Authorization - Following receipt of CONTRACTOR's Change Proposal, EMPLOYER shall critically review said proposal. Should EMPLOYER concur with the proposal, a formal Change authorization will be executed by EMPLOYER and CONTRACTOR, with the latter released to proceed immediately with the Change. Changes so authorized will be deemed to be all-inclusive in all respects. Subsequent claims based on the "accumulated impact" of many or all changes previously authorized will not be recognized. In case the EMPLOYER does not implement the proposed change, the CONTRACTOR has to be compensated only for the proposal preparation cost as stated in II. C. 4.f aforementioned. PMC has to monitor the CONTRACTOR for complying with the EMPLOYER’s requirements. E. Monitoring and Reporting CONTRACTOR shall maintain a Change Orders summary which shall be submitted monthly to EMPLOYER's Project Manager or more frequently if EMPLOYER requires. Said summary shall include, as a minimum, the following information in tabular format: 1. Change proposal number and brief description, 2. Date Change requested, 3. Date submitted to EMPLOYER, 4. Date approved or rejected by EMPLOYER, 5. Disposition (approval or rejection), 6. Impact on Control Budget and Target Completion Date, 7. A preliminary cost estimate of each pending Change. International Bidding Process N° PCI-002-2008-OFP/P ETROPERU



8. CHANGE CONTROL PMC has to check the CONTRACTOR’s Change Proposals for complying with the requirements and validity of the EMPLOYER and at the same time it has to provide EMPLOYER’s Project Manager with the recommendations for its disposition or approval.




9. PROJECT SPECIFICATIONS I.

OBJECTIVE This instruction has as objective to address requirements for CONTRACTORprepared Project specifications as follows: •

Basic Design Specification, which for TRM Project are entitled Basic Design Packages (BDP)

•

General Engineering Specifications (usually common for all BDP Packages)

•

Supporting Calculations

•

Construction Specifications (usually common for all BDP Packages)

II. GENERAL REQUIREMENTS EMPLOYER will identify the GES to be used in the global Project development or early in the BDP preparation period. Those GES shall be provided by FEED-EPC CONTRACTOR, to be used during the Project activities, a whole set (printed and electronic files) of these GES shall be given to the EMPLOYER Project Manager. CONTRACTOR shall submit, at Agreement Signature, for EMPLOYER’s review and comment its standard procedures for preparing project specifications. Said procedures shall be subsequently modified as EMPLOYER’s Project Manager deems necessary to satisfy project requirements. III. SPECIFIC REQUIREMENTS A. Basic Design Specifications Following are minimum requirements for Basic Design Specifications where Contractor is required to prepare said specifications. 1. General - Separate process design information is to be developed for the selected and alternative designs. (Design calculation requirements are covered in Section III.C). Outline, format, and table of contents will be subject to EMPLOYER approval prior to CONTRACTOR beginning preparation of Basic Design. 2. Specification Contents a. Description of facilities b. General information and instructions applicable to all design specifications (e.g., basic engineering design data).




9. PROJECT SPECIFICATIONS c. General engineering specifications covering all applicable areas of detailed engineering design (e.g., piping, pressure vessels, etc.) d. Process flow diagrams (PFD) for each system showing flow sequence, quantity, and stream composition at all interfaces. e. Piping and instrument diagrams (PI&D) showing flow sequence in detail and specifically showing: All process pipes and valves including their size, flange rating, material and corrosion allowance, thermal insulation, and steam heating requirements; All equipment with item number(s) and the following information: Drums and towers

−

dimensions and design temperature and pressures;

Exchangers

−

duty and surface areas;

Furnaces

−

duty by service and heat fired;

Pumps

−

rate, Pressure and specific gravity at normal conditions;

Control valves

−

DP, Pressure and air failure action;

Compressors

−

rate, MW, GHP, inlet and outlet conditions;

Safety valves

−

set pressure;

Instrumentation;

Connections to Safety and Utility Systems;

Normal operating temperatures and pressures; Utility rates (normal and maximum); Battery limit temperatures, pressures, and flow rates for feed and product streams. f.

Specifications for all process equipment including dimensions or capacities, construction materials, corrosion allowances, and complete definition of special or unusual features. CONTRACTOR may use its standard engineering specification sheets to exhibit these data.

g. Full definition of all tie-in points (physical coordinates, etc.). h. Plot plans and elevation drawings, showing location of process equipment and elevations.




9. PROJECT SPECIFICATIONS i.

Utilities for the entire Plant by individual consumers including normal and maximum requirements of water (cooling and process), fuel, power, and steam.

j.

Safety and pollution control requirements including any onsite blowdown drums and water disengaging facilities.

3. Supporting Heat and Material Balance Memoranda a. Compositions, conditions, quantities and properties of all processes streams for normal and startup operations if different. b. Temperature - enthalpy curves or tables for each heat exchangers service especially where such relationship is non-linear. Dewpoint and bubble point are to be designated. 4. Supporting Study Memoranda Pertinent data on any alternate cases or economic studies performed by Contractor. B. General Engineering Specifications CONTRACTOR shall submit, at Agreement Award, for EMPLOYER’s review and comment its standard general engineering specifications. Said specifications shall subsequently be modified or supplemented as EMPLOYER’s Project Manager deems necessary to meet with EMPLOYER requirements and criteria. CONTRACTOR's specifications for the Project shall cover all applicable areas of detailed engineering design, reflecting Job Specification requirements, government requirements, and industry-accepted practices and procedures for process Plant engineering/construction. As such, they shall be entirely consistent with information, directives, and standards produced by state and local government, trade, and industry organizations. A partial source list of required codes, specifications and standards follow: •

API: American Petroleum Institute

•

ANSI: American National Standards Institute

•

ASTM: American Society for Testing and Materials

•

ASME: American Society Mechanical Engineers

•

TEMA: Tubular Exchanger Manufacturers Association




9. PROJECT SPECIFICATIONS •

NACE: National Association Corrosion Engineering

•

ISA: Instrumentation Society of America

•

NEMA: National Electrical Manufacturers Association

•

IEEE: Institute of Electrical and Electronics Engineers

•

IEC: International Electrotechnical Commission

•

IES: Illumination Engineering Society

•

IRI: Industrial Risk Insurers

•

OIA: Oil Insurance Association

•

NFPA: National Fire Protection Association

•

UL: Underwriters Laboratories

•

FM: Factory Mutual

•

NFPA 70: National Electrical Code

•

OSHA: Occupational Safety and Health Administration

•

CENELEC: Committee of European Normalization Electrotechnique.

•

ISO: International Organization for Standarization

•

ARI: Air-conditioning and Refrigeration Institute

•

AMCA: Air Movement and Control Association

•

ASHRAE: American Society of Heating Refrigerating and Air-conditioning Engineering

Other codes used in the refinery industry For designing the building structures, the Bidder will present its proposal about regulations, engineering and building standards, for the EMPLOYER’s approval, but the compliance with the national structural standards in force of the Reglamento Nacional de Edificaciones (National Building Rules) must necessarily be taken into consideration.




9. PROJECT SPECIFICATIONS •

Standard E-050; Soils and Foundations

•

Standard E-030; Seismic-resistant Design

•

Standard E-060; Reinforced Concrete, these will be complemented with the rules for structural concrete, regulations and standards of the ACI; the most demanding requirements shall be taken into consideration.

•

Standard E-070; Brickwork

•

Standard E-090; Metallic Structures; these must be complemented with the AISC-LRFD structural steel standards for high-seismic areas.

PERUVIAN REGULATIONS The Hydrocarbons Act, Law 26221, and its Regulations. D.S. 051-93-EM, 052-93EM, 015-2007-EM. Where such codes, specifications and standards permit design options, CONTRACTOR shall not select an option without prior EMPLOYER’s approval. C. Supporting Calculations Requirements for all Contractor-prepared supporting calculations for both Basic Design Specifications and other work follows: 1. Basic Design Specification Calculations a. CONTRACTOR shall provide EMPLOYER with six (6) bound sets of all final design calculations upon which the Basic Design Specifications and any alternatives are based. Organization, format, and level of detail shall be specified by EMPLOYER’s Project Manager. b. Said calculations shall use the English language and international system of measurements, with certain exceptions as may be permitted/instructed by EMPLOYER. 2. Other Technical Calculations a. CONTRACTOR shall provide, as required by EMPLOYER’s Project Manager, all other calculations relating to detailed engineering and various studies. b. Said calculations shall also use the English language and international system of measurements, with certain exceptions which may be permitted/instructed by EMPLOYER.




9. PROJECT SPECIFICATIONS D. Construction Specifications At least six (6) months prior to initiating any field construction activity, CONTRACTOR shall submit for EMPLOYER’s review and comment its standard construction specifications. Said specifications shall subsequently be modified or supplemented as EMPLOYER's Project Manager deems necessary to comply with project requirements. CONTRACTOR's Construction Specifications for the project shall cover all applicable areas of construction and shall reflect all Job Specification requirements, all government requirements, and industry-accepted practices/procedures for processes plants construction. As such, they shall be entirely consistent with information and directives in the most recent revisions of all applicable codes, specifications and standards produced by government, trade, and industry organizations (partial source list provided in III.B.). CONTRACTOR's Construction Specifications shall be entirely consistent with Contractor's Overall Construction Plan (See Project Instruction Nº 12 – Overall Construction Plan). IV. SPECIFICATION INDEX A. Contractor shall update and issue as directed by EMPLOYER’s Project Manager, specification indexes of all standard specifications, standard drawings, project specifications, etc. prepared by CONTRACTOR and applicable to project. Said indexes shall be distributed in accordance with Exhibit 1-3 (Project Instruction Nº 1 – Correspondence). B. For Project specifications, the index shall clearly indicate: • Title and number of the specification • Due date • Start date and progress • Completion, approval, release, and revision dates • Engineering discipline and individual responsible




10. FINANCE AND INSURANCE I.

OBJECTIVE This instruction covers the general requirements for: •

Accounting/Auditing,

•

Invoicing,

•

Code of Accounts,

•

Cash Flow,

•

Insurance.

II. REQUIREMENTS A. Accounting/Auditing 1. CONTRACTOR shall submit its standard cost accounting and audit procedures for EMPLOYER’s review and comment. CONTRACTOR shall modify these as EMPLOYER’s Project Manager deems necessary to comply with EMPLOYER requirements. 2. Cost accounting procedures shall follow CONTRACTOR's standard account codes and permit a breakdown into EMPLOYER's code of accounts at the close of the project by means of an engineering type estimate. 3. CONTRACTOR shall ensure that EMPLOYER's audit privileges under the Agreement are appropriately extended through all levels of the Agreement and all subcontracts. B. Invoicing 1. The CONTRACTOR's invoices shall be submitted in such form and detail as required by the Employer. Said invoices shall be addressed to the EMPLOYER and submitted to the EMPLOYER's Project Manager as to Services and Work performed, attaching the respective justification approved by the EMPLOYER or its Representative. Review, consideration and payment of said invoices will be undertaken in accordance with the Contract Agreement and the EPC Conditions of Contract."




10. FINANCE AND INSURANCE C. Cash Flow 1. Within two (2) weeks after FEED-EPC Contract Signature, CONTRACTOR 1 shall submit, for EMPLOYER's review and approval, a disbursement plan that will address at least the following: •

Dollar value of invoicing by month.

•

Uncertainties regarding the planned invoicing.

•

Periods where project cash flow may be crucial to the Contractor, vendors, and subcontractors.

•

Assumed lag times between: - cost incurred by Contractor, - cost paid by Contractor, - invoicing by Contractor for reimbursable Costs and Fee, - payment by EMPLOYER for reimbursable Costs and Fee.

2. CONTRACTOR shall update this plan as necessary when conditions change materially. 3. CONTRACTOR shall promptly advise EMPLOYER of non-project related events or developments within the Contractor which can reasonably be expected to impact on the financial status of this project. D. Insurance 1. Two (2) months prior to initiating any activity covered by insurance, CONTRACTOR shall submit for EMPLOYER approval its procedures for executing the following activities for appropriate insurance category or categories: a. Notification to Company of any anticipated or actual claims and losses/damages affecting the project or Company's property, supported by cost assessments and documentation. b. Investigation of all claims, losses, and damages including preparation/issuance of reports to EMPLOYER’s Project Manager. Said procedures shall be approved before initiating subject activity. 1

Question 117 - Round 3. (It is necessary to follow the instructions of number 18 of the Information to Bidders to the execution of the Contract.)




10. FINANCE AND INSURANCE 2. Two (2) months prior to the commencement of field activities, CONTRACTOR shall submit for EMPLOYER’s review and approval, CONTRACTOR's proposed procedures to minimize any claims and losses or damage to the project and EMPLOYER's facilities.




11. RESPONSIBILITY FOR OTHER CONTRACTS I.

OBJECTIVE As set forth in the Project Instructions, Contractor shall administer and supervise, in representation of the EMPLOYER, certain contracts for work relating to, but not included in, the scope of the Contract. A listing of these other contracts and each Supervised Contractor (SC) is provided in Exhibit 11-1 below. Said activity and the performance of each SC listed in Exhibit 11-1 shall be provided by the EMPLOYER and must be incorporated by Contractor into the overall scope of own project 1 execution responsibilities to EMPLOYER . This Project Instruction covers general and specific requirements of such incorporation.

II. RESPONSIBILITIES A. General 1. Contractor, as supervisor and coordinator of SC activities, shall expand the definition of its own interface responsibilities with the EMPLOYER to include all SC relationships. 2. Contractor shall thoroughly review and acquire complete familiarity with contract documents of each SC. Should Contractor discover any inconsistencies among said contracts, or between said contracts and the Contract, it shall immediately advise the EMPLOYER’s Project Manager of the EMPLOYER about these inconsistencies for requiring any action by the EMPLOYER. 3. Notwithstanding the necessity for resolving possible inconsistencies indicated in numeral II.A.1, the Contractor shall ensure compliance of all the Project Instructions. Contractor shall continuously monitor each SC's cost, schedule, and quality performance, bringing deficiencies to SC's attention and following up for corrective action. Contractor shall immediately advise the EMPLOYER about any circumstances of a serious nature. 4. Contractor shall note and comply with requirements of Project Instruction Nº 15 – Measurement of Percentage Completion regarding the progress reporting of SC activities. 5. Contractor shall include with its Monthly Progress Report, separate summaries and assessments of each SC's progress and performance. 6. Contractor shall receive, review, countersign, and transfer to the EMPLOYER all SC notices relating to SC's contract provisions including but not limited to: a. Dates of Mechanical Completion and Acceptance, 1





11. RESPONSIBILITY FOR OTHER CONTRACTS b. Strikes and Force Majeure, c. Variations in project conditions, d. Intention to terminate work suspended. B. Specific Contractor's specific responsibilities regarding SC surveillance, coordination, and direction are as follows: 1. Time Management - Contractor shall include within its time management activities: a. Reviewing each SC's work program for conformance with the total project schedule, and with EMPLOYER's prior concurrence, effecting all necessary improvements. b. Ensuring an overall SC cognizance of any project developments with potential impact on SC work. 2. Cost Management - Contractor shall include within its cost management activities: a. Monitoring SC cost management efforts, immediately advising the EMPLOYER of deficiencies, and undertaking corrective action as directed by the EMPLOYER. b. Receiving, reviewing, countersigning, and remission of SC invoices to the EMPLOYER, prior to Conversion. c. Receiving, reviewing, countersigning, and remission SC Change proposals and claims for changes in work. 3. Quality Management - Contractor's quality management function shall include: a. Confirming the acceptability of subcontractors and sources of material supply to be utilized by each SC (Project Instruction N° 5 - Procurement). b. Reviewing SC quality management procedures for compliance with project requirements. c. Monitoring SC QA/QC efforts, and where Contractor assesses these as deficient, immediately advising to the EMPLOYER and undertaking remedial action as directed by the EMPLOYER.



VOLUME 2 PROJECT INSTRUCTIONS TO PART C SERVICES AND DELIVERABLES - FEED & EPC PAGE 3 OF 3 Exhibit 11-1 Page 1 of 1 DATE: JULY 12, 2009

RESPONSIBILITY FOR OTHER CONTRACTS EXHIBIT 11-1 LISTING OF SUPERVISED CONTRACTORS

TO BE PROVIDED BY THE EMPLOYER

EMPLOYER’S CONTRACT NO.

SUPERVISED CONTRACTOR

CONTRACT DEFINITION


CONTRACT TYPE



12. OVERALL CONSTRUCTION PLAN I.

OBJECTIVE This instruction covers requirements for Contractor's Overall Construction Plan which shall fully describe Contractor's procedures and strategies for executing the project at Site.

II. REQUIREMENTS At least six (6) months prior to initiation of its Site operations, Contractor shall submit for EMPLOYER approval its proposed construction plan establishing Contractor's requirements and those of Supervised Contractors and subcontractors. Until such time as EMPLOYER approves said plan, Contractor shall not commence any field 1 activity . III. PLAN DEVELOPMENT A. Site Recognition Development of the plan shall address detailed data produced from Contractor's Site recognition. Any Site recognition information not collected by Contractor during its bid preparation, but required for plan development, shall be collected in a follow-up recognition. Said recognition shall be undertaken as early as practical during FEED Phase and shall ensure complete coverage of such items as:

1

•

Site description including soils information, borings, marine data, and existing facilities;

•

Meteorological data, climatic conditions, and seismic conditions;

•

Water supply, communications, and other utility services including fire-fighting capability;

•

Transportation facilities government regulations;

•

Construction camp considerations and environmental considerations such as waste disposal and sanitation;

•

Living conditions including community factors and local attitudes;

•

Government requirements regarding design and inspection, construction permits, import-export licenses, work permits, visas, taxes, benefits, etc.;

including

material

handling

Question 242 - Round 1.


capabilities

and



12. OVERALL CONSTRUCTION PLAN •

Owner requirements and assistance re: work permits, operator training, government liaison, etc.;

•

Quality and quantity of local manufacturers, vendors, and suppliers;

•

Availability, skills, training requirements, unions, wages, and attitudes of construction labor;

•

Construction labor agreement summaries including expiration dates and local jurisdictional agreements.

•

Availability, sources, and cost of construction equipment and tools;

•

Local subcontractors, engineering firms, and laboratories;

•

Local shop facilities including capacities, qualifications, and union affiliations;

•

Construction practices and other factors and considerations;

•

Special requirements for unusual or unique project conditions;

•

Cost data regarding commodity prices, equipment codes, cost of living, etc.

B. Plan Content Contractor's procedures shall completely define the handling of its Site operations. Representative items to be addressed shall include: 1. Temporary Facilities Planning Items •

Temporary building and all utility requirements;

•

Materials flow including roadways, traffic unloading and warehousing areas, etc.;

•

Site safety, security, and sanitation including firefighting, latrines, first aid, etc. (Ref. Project Instruction N°13 – Site Health, Safety, Security, and Environmental);

•

Functional area requirements including quarry, batch plant, piping fabrication, etc.;

•

Subcontractor and Supervised Contractor area requirements;

•

Personnel transport including vehicles, parking areas, etc.;

•

Construction camps requirements;





Communications;

•

Heavy lift equipment including gin poles, guyed derricks, etc.;

•

Welding requirements regarding system;

•

Cold and/or hot weather requirements;

•

Site drainage and erosion control;

•

Fuels and consumable gas requirements.

portable welders equipment or welding

2. Operational Planning Items •

Field Construction Schedule development including field start date;

•

Field organization charts, staff and labor requirements for entire job, mobilization/demobilization considerations, and timing;

•

Field Quality Management program including Quality Control and Quality Assurance functions;

•

Field Time and Cost Management functions;

•

Site Procurement function including receiving, storing and issuing equipment, materials, construction tools, etc.;

•

Requirements and timing for establishing and staffing intermediate bases of operation;

•

Heavy lift plans for lifts in excess of higher than 100 tons or 80% of lifting equipment's maximum rated load (all two-crane lifts are considered critical);

•

Testing/inspection of lifting equipment;

•

Lifting equipment erection/dismantling;

•

Rigging interference for lifting plan;

•

Requirements for tools and equipment including maintenance;

•

Job subcontractors plan and administration;

•

Site coordination procedures;





Plans for recruiting, hiring, and assimilate personnel;

•

Assistance for necessary insurance coverage:

•

Assistance for drainage and run-off control;

•

Assistance for securing work permits;

•

Equipment protective maintenance;

•

Plans for obtaining vendor technical representative consultancy;

•

Liaison with EMPLOYER;

•

Liaison with other parties such as public utilities, the media, etc.;

•

Plan for pre-job labor conference (as applicable);

•

Site work rules.

C. Plan Format Format, text, drawings, charts, etc. of Contractor's Overall Construction Plan may follow Contractor's standard presentations subject to the prior review and approval by EMPLOYER. D. Construction Specifications Contractor shall ensure complete consistency of contents between its Overall Construction Plan and Contractor’s and EMPLOYER’s Construction Specifications (See Project Instruction N° 9 – Project Specificati ons).




13. SITE HEALTH, SAFETY, SECURITY, AND ENVIRONMENTAL I.

OBJECTIVE This instruction presents general and specific requirements of Site health, safety, security, and environmental for this project. The FEED-EPC CONTRACTOR is obliged to accomplish with the Integral Management System that the EMPLOYER has implemented for its operations or Project Management; likewise, he shall prepare and submit all the Project reports in relation with said system. In the Plan to be submitted to the FEED-EPC CONTRACTOR shall have into account the identification and development as minimum of the following factors. •

Processes List

•

Processes Mapping

•

List of environmental aspects by process

•

Matrix of Significance Evaluation

•

List of significant environmental aspects

•

Operational Control Matrix.

The EMPLOYER (or EMPLOYER Representative that acts in behalf of the EMPLOYER) shall be authorized to perform audits about any aspects of the FEEDEPC CO0NTRACTOR system. II. REQUIREMENTS A. General 1. Formulation and subsequent execution of all Contractor procedures and directives regarding health, safety, security and environmental protection shall comply fully with all Peruvian governmental requirements and EMPLOYER procedures, specially those specified in the Security Manual, health at work and Environmental Protection – M 040 of PETROPERU S.A.. 2. Special attention shall be assigned to the accomplishment of the activities, norms and guidelines of the Environmental Handling Plan and the Community Relations content in the Project Environmental Impact Assessment Study and the Health and Security, Environment and Occupational Health Management Plan of the EMPLOYER.




13. SITE HEALTH, SAFETY, SECURITY, AND ENVIRONMENTAL 3. The CONTRACTOR shall take all the measurements in health security at work and Environmental Protection, in order to prevent accidents, incidents or environmental impacts, accomplishing with what it is established in the Integrated Environmental System, Security and Occupational Health of the EMPLOYER. 4. In complying with all procedures and directives in II.A.1 above indicated, Contractor shall be responsible not only for its own employees but also for those of its subcontractors and Supervised Contractors. Where Contractor's efforts are deemed deficient by the EMPLOYER, Contractor shall improve these efforts by whatever means the EMPLOYER deems necessary. B. Specific As part of the Overall Construction Plan (See Project Instruction N°12), Contractor's proposed Site health, safety, security and environmental procedures and directives shall address as a minimum: 1. Safety a. Participation of Contractor's Site management and supervision personnel in executing Contractor's safety procedures. b. Structure, responsibilities and activities of Contractor's Site safety organization and interface with similar local organizations and of the EMPLOYER. c. Safety education and indoctrination programs, including incentives. It should be noted that all Contractor, and Contractor’s subcontractor, Supervised Contractor, and vendor personnel attend a safety training program class and pass, as a minimum. Any unescorted personnel will be required to meet the EMPLOYER’s administrative requirements. All construction employees and/or other personnel who will perform Work at the Site will require the EMPLOYER’s specific training program. Depending on the nature of Contractors and its subcontractors/supervised contractors, other training programs may be required, i.e., fresh air mask training, etc. d. The CONTRACTOR shall answer by any accident or incident occurred during the execution of the works, reserving the EMPLOYER the right of indicating the CONTRACTOR as responsible of the obligations generated by the mentioned event. e.

Vehicular and pedestrian traffic control including walkways, parking, etc.




13. SITE HEALTH, SAFETY, SECURITY, AND ENVIRONMENTAL f.

Safety inspections and accident prevention programs with enforcement provisions.

g. First Aid plans. h. Disaster contingency plans for fire, weather extremes, etc. i.

Work permit control.

j.

Safety reports, records, and statistics.

k. Relations with government safety authorities. l.

Compliance with the EMPLOYER's regulations for contractors working within the plant.

2. Security a. Participation of Contractor's Site management and supervisory personnel in executing Contractor's security procedures. b. Provisions for security personnel independent of EMPLOYER's security forces. c. Work force screening, orientation and positive motivation programs with disciplinary action provisions for all personnel -- direct hire, subcontract, agency, etc. d. The person in charge of the works by the part of the CONTRACTOR shall be the responsible for the vigilance and the accomplishment of its Security Program, Health at work and Environment. e. Physical measures, including: •

Perimeter barriers (fences, walls, gates, guardhouses, personnel and vehicle check points, etc.)

•

Positive identification (photo badges, color coded hard hats, tool and equipment marking, etc.)

•

Other (alarms, safes, communications, building security provisions, etc.).




13. SITE HEALTH, SAFETY, SECURITY, AND ENVIRONMENTAL 3. Health a. Participation of Contractor's Site management and supervisory personnel in executing Contractor's Health procedures. b. Siting and control of canteens, dormitories, and latrines including decontamination provisions. c. Sanitary inspections. d. Waste and rubbish removal programs. e. Medical screening and surveillance of all personnel, especially food service workers. The CONTRACTOR shall have the obligation of carrying out the medical exam to its workers according to the risks to which they are exposed and according to the established in the legal norms in force. f.

When an accident or incident occurs, the CONTRACTOR shall inform to the EMPLOYER about the event and shall submit a detail report. Moreover, he shall inform to the governmental organisms (Ministry of Labor and Job Promotion, Osinergmin, etc)

4. Environmental a. The CONTRACTOR shall submit an evaluation of significance of its environmental aspects that include the correspondent operational controls, monitoring and the verification of those significant, in accordance to the established in the Integrated System of EMPLOYER Management. b.

Participation of Contractor's Site management and supervisory personnel in executing Contractor's Environmental procedures.

c. Control and disposal of Contractor generated hazardous material. d. Containment of potential hazardous material spills, i.e. fuel storage, oil leaks, chemical cleaning solutions/waste. e. Identification of hazardous material and procedures for a safe work environment. f.

Classification of hazardous Contractor’s scope of Work.

materials

discovered

in

carrying

out

g. The CONTRACTOR, in case of acquiring chemical products for the activities to be carried out in the EMPLOYER installations shall provide to the EMPLOYER the security sheet of material, known also as MSTS




13. SITE HEALTH, SAFETY, SECURITY, AND ENVIRONMENTAL (Material Safety Data Sheet) in accordance to ISO 11014-1 ISO and in Spanish. h. Control and disposal of hazardous waste i.

Control of dust, noise and disposal of non-hazardous spoil material generated during course of performing Contractor’s scope of work. It should be noted the EMPLOYER will provide a spoil disposal area on site.

j.

Notification to all Contractors, and its subcontractor/Supervised Contractor employees of any hazardous material conditions, and issuance of MSDS and sheets, along with provisions for proper protective clothing and other precautionary measures appropriate for any given situation.




14. MONTHLY PROGRESS REPORTING I.

OBJECTIVE This instruction refers to the requirements and content of Contractor's Monthly Progress Report and the hierarchical monthly reporting support system which can be quickly referenced upon request by the EMPLOYER. Characteristics of Contractor reporting are covered in a number of Requirements/Project Instructions. It is expected that a Contractor will respect all the Requirements/Project Instructions. If questions arise regarding any Requirement/Project Instructions, the Contractor should immediately seek the EMPLOYER clarification before choosing an interpretation or a course of action.

II.

REQUIREMENTS A. Procedural Contractor shall issue to the EMPLOYER a Progress Report summarizing the performance and status of all major aspects of the Project, no less than monthly. Contractor’s Progress Report shall be issued as maximum the fifth th (5 ) of the month following the reporting period. Contractor shall submit for the EMPLOYER review and approval its standard monthly progress reporting format which shall be modified as necessary to comply with EMPLOYER requirements. Distribution shall comply with requirements of Exhibit 1-3 (Project Instruction N°1 – Correspondence). B. Principles The EMPLOYER desires that Contractor Progress Reports be carefully structured so that important/relevant and comprehensive summary about the development of the project in an easily understandable and quantitative manner. The Report shall be brief but clear in all aspects, utilizing management summary displays whenever possible. As a general principle, the EMPLOYER requires that Contractor maintain the original baseline performance information and curves on all presentations, even if the EMPLOYER Company has approved revised projections. Such revised projections will be designated as Revisions. The EMPLOYER desires to be alerted early to any significant project variances from plan/expectations. This being surfaced, while being assured that Contractor’s hierarchical project tracking and monitoring system is effectively picking up such variances early without the EMPLOYER having to




14. MONTHLY PROGRESS REPORTING exhaustively examine Contractor’s entire array of monitoring activities each month. Contractor Monthly Progress Reports should contain a highlighted area where the most significant challenges are described along with either the recommended or the approved course of action. Contractor Monthly Progress Reports should also contain a log of open action items with appropriate notification and requirement dates and designation of the responsible party. Items contained therein shall be maintained until fully completed. Contractor shall not use the Monthly Progress Report as a primary source of first time communication to the EMPLOYER regarding important project developments, challenges and/or status information. C. Content The Progress Report shall contain two major portions: Analytical. 1.

Narrative and

Narrative – The Narrative section shall clearly and concisely assess the current status (cost, schedule, etc.) of the project, identify any pertinent opportunities, deviations or problems and define appropriate solutions and/or actions. It shall also describe the status of action items or problems identified in earlier reports. Contractor’s narratives should be limited and also contain quantitative comparative information which allows the reader to determine quickly if the subject being referenced occurred as planned, and if not, what the deviation is from planned.

2.

Analytical – The Analytical Progress Report shall be configured in accordance with Exhibits 14-1 through 14-14. It is intended that the Progress Report contain at its highest levels an overall assessment of Project status, with further details available at progressively lower hierarchical levels. Thus, the Project Summary and Cost Summary may be used to obtain a quick insight into status and progress, with identification of potential problems areas for further pursuit in more detailed areas of the Report. Management summary graphs should be included when appropriate to aid in the review and understanding of the report. All advance status comparisons should contain the corresponding planned expectation and reflect present status relative to said expectation. The EMPLOYER prefers that as much summary status information as reasonably possible be presented in quantitative format.




14. MONTHLY PROGRESS REPORTING If Contractor has a standard Progress Report that covers and contains substantially all the elements contained in the exhibits, it may submit information regarding this standard to the EMPLOYER for consideration. Only upon the EMPLOYER’s written approval may the standard be used as replacement for all or any portion of the exhibits. More likely, the EMPLOYER will request that Contractor amend its standard to incorporate the requested information not included in the Contractor’s standard. Specific content shall include the following: a. Overall statement of the advance of the project and perspectives (safety statistics, cost, schedule, progress, etc.) supported by summaries extracted from Contractors other published reports for the project. b. Areas of concern and opportunities, significant risks or challenges and their proposed solutions; status of previously identified risks and challenges and proposed resolution. c. Analysis of the project schedule as described in Project Instruction N° 2, Section III.E, Time Management. d. Analysis of the project costs and cash flow curve as described in Project Instruction N° 3, Section III.A.2.e, Cost M anagement. As noted in Project Instruction N° 3 – Cost Managem ent, following the conversion from Reimbursable Cost to Lump Sum cost basis, the requirement as noted herein under Section C.2.d shall be amended. All other requirements as noted herein (Project Instruction N°14 – Monthly Progress Reporting) shall remain in force. e. Summary of change orders for month reported plus cumulative totals, as described in Project Instruction N° 8, Section I I.E - Change Control. f.

Analysis of Project Progress (Earned Value), citing Plan, Real Forecast to include: •

Engineering Progress (Earned Value) -

Progress Curve

-

Staffing Histogram

-

Productivity




14. MONTHLY PROGRESS REPORTING •

Procurement Process -

•

Progress Curve

Construction Progress (Earned Value) -

Progress Curve

-

Staffing Histogram

-

Productivity

g. Analysis of project quality issues such as summary of NonConformance Reports (NCR) and Corrective Action Reports (CAR), including number issued, number resolved, number outstanding and status of resolution for outstanding NCR’s and CAR’s, describing quality issues for month reported and highlighting most significant issues and resolution proposals. h. Subcontract information and status as per Project Instruction N° 5, Section III.C.11, Procurement. i.

Procurement and expediting summary status report as described in Project Instruction N° 5, Section III.D.3.a and b, Procurement.

j.

Brief summary of Supervised Contractor (SC) progress and performance as per Project Instruction N° 11, Secti on II.A.5, and Responsibility For Other Contracts.

k. Analysis of Site Safety, and Environmental incidents. l.

Site progress photographs.

D. Review If requested by the EMPLOYER’s Project Manager, Contractor shall submit its Monthly Progress Report for review prior to formal release.




15. MEASUREMENT OF PERCENTAGE COMPLETION I.

OBJECTIVE This Project Instruction addresses basic requisites and procedures for Contractor's measurement of percent of Work complete.

II. GENERAL REQUIREMENTS Contractor shall submit at the Contract signature, for the EMPLOYER's review and comment, its standard procedures for physical progress measurement. Subsequent to any modification deemed necessary by the EMPLOYER’s Project Manager, said procedures shall be used to provide project control in time and cost management. A. Project Control - In conjunction with Time Management (Project Instruction N° 2), Contractor shall apply measurement of percentage physical completion to all project activities to detect unfavorable schedule trends, deficiencies in productivity, potential schedule overruns, and other project execution problem areas. B. Progress Payment - As set forth in the Agreement, Contractor shall submit at specified intervals invoices for portions of the amounts earned and Mark-Up according to categories specified in the Agreement. Invoiced amount for each category shall be directly proportional to measured actual completion of Work at end of invoice period. Cost Management shall detect unfavorable cost trends, potential cost overruns, and other project execution problems. Contractor shall ensure that said measured percentages exclude all components attributable to Supervised Contractor progress. III. SPECIFIC REQUIREMENTS For the above purposes, Contractor's physical progress measurement procedures shall utilize principles of work breakdown structuring and earned value progress reporting presented below. Contractor shall also cause all Supervised Contractors (See Project Instruction N°11 – Responsibility for Other Contracts) to adhere to said principles for all overall consistency. A. Work Breakdown Structure (WBS) - Contractor shall subdivide the entire project effort (including Work and responsibilities of the EMPLOYER, Supervised Contractors, and other project participants) into smaller activity packages for increased visibility and control. Said breakdown shall require: 1. A format to completely define relevant and descending control levels by which the project can be most effectively checked and controlled such as:




15. MEASUREMENT OF PERCENTAGE COMPLETION a. Participants - Company, Contractors. etc.;

Contractor,

subcontractors,

Supervised

b. Project phase - process design, detailed engineering, procurement, field construction, etc.; c. Function - engineering, planning, procurement, etc.; d. Design specification - identified units; e. Engineering discipline - civil/structural, process, electrical, mechanical, etc.; f.

Engineering discipline activity - general arrangement drawings, model, etc.;

g. Field craft - civil/structural, electrical , mechanical, etc.; h. Field craft activity - piling/foundations, piping, etc. 2. Work element identification must be completely consistent with Contractor's standard account codes (See Project Instruction N° 10, Section II.A), the Control Estimate, and the project schedule (See Project Instruction N°2 – Time Management) so that each element in the WBS will be identified in the account code, estimate, and schedule. (Vendor activities and level-of-effort items such as supervision are exceptions to this rule.) Said identification shall require: a. Listing of all elements, designating control levels to which they pertain, and specifying project participant(s) responsible for their execution. b. Defining each element's content in terms of cost, material quantities, hours of effort, subcontract or consulting assistance, etc. B. Earned Value (EV) Progress Reporting Contractor shall report progress in such form and detail as approved by the EMPLOYER’s Project Manager.




16. MECHANICAL COMPLETION AND FACILITIES TURNOVER I.

OBJECTIVE This instruction covers the requirements of Mechanical Completion and Facilities Turnover and defines attendant Contractor and the EMPLOYER’s responsibilities. The CONTRACTOR shall include in its Project Preliminary Plan the initial procedures for the phases of Mechanical Completion and Pre-Commissioning1.

II. DEFINITIONS Following definitions apply to completion and turnover: •

•

1

Mechanical Completion means, in respect of the Works and any Section, when all of the following requirements have been satisfied (a)

the Contractor has constructed and installed all Materials, Plant and other equipment, components and systems constituting the Works or the relevant Section (except for completion of minor portions of the Works or Section such as painting, final grading, final insulation, and any other portion of the Works or Section not affecting the Pre-Commissioning, reliability, dependability, operability, safety, compliance with applicable Laws and mechanical and electrical integrity of the Works or Section) in accordance with the Contract;

(b)

the Contractor has made available for inspection by the Employer all Permanent Works systems in accordance with the procedures set out in the Master Job Specifications or mutually agreed to at the time by the Contractor and the Employer;

(c)

the Works or relevant Section are mechanically and electrically sound, all systems have been flushed, cleaned out and filled as necessary for PreCommissioning; and

(d)

the Works or relevant Section are in all other respects ready for PreCommissioning

Pre-Commissioning means, in respect of the Works and any Section: (a)

all pre-operations checking and testing required for the start up of the Works or Section; and

(b)

all other work and testing forming part of Pre-Commissioning as set out in the Master Job Specification.

Question1 – Round 3.

International Bidding Process N° PCI-002-2008-OFP/PETROPERU



16. MECHANICAL COMPLETION AND FACILITIES TURNOVER •

Ready for Start-Up (RFSU) means, in respect of the Works and any Section, when all of the following requirements have been satisfied: (a)

the Works or Section have achieved Mechanical Completion;

(b)

all Pre-Commissioning for the Works or Section has been completed satisfactorily and all systems have been started up in accordance with the procedures set out in the Master Job Specifications or mutually agreed to at the time by the Contractor and the Employer and can be operated without the use of temporary equipment that is not part of the Works or the relevant Section;

(c)

all systems and subsystems relating to the Works or the relevant Section have been installed and the equipment and systems included therein (except for completion of minor portions of the Works or Section such as painting, final grading, final thermal insulation, and any other portion of the Works or Section not affecting the start up or Commissioning of the Works or Section) can be operated: (i)

operated in accordance with Good Engineering and Construction Practices and applicable Law; and

(ii) in a manner that does not void any Subcontractor or system warranty;

(d)

the Contractor has provided to the Employer the documents in accordance with Sub-Clause 5.6 [As-Built Work Documents] and Sub-Clause 5.7 [Operation and Maintenance Manuals], of the EPC conditions in respect of the Works or the relevant Section;

(e)

the Contractor has provided any training which is required by the Master Job Specification for the Employer's Personnel or the Employer's contractors' personnel who will participate in Commissioning and/or the Guarantee Tests of the Works or the relevant Section (save for any training which the Master Job Specification states may be provided after the commencement of the Guarantee Tests);

(f)

the Contractor has supplied the spare parts, special tools, Consumables and other facilities, services and materials required to be delivered in accordance with the Master Job Specification for Commissioning and/or the Guarantee Tests for such part of the Works.

(g)

the Works are all in all other respects ready for Commissioning in accordance with the Contract; and




16. MECHANICAL COMPLETION AND FACILITIES TURNOVER (h)

the Contractor has performed all other obligations expressly stated in the Contract to be pre-conditions, or required, for Ready for Start Up.

•

Guarantee Tests means the operative tests to be carried out to determine whether the Processes Guarantees and, where applicable, the Minimum Guarantee Levels have been attained, as more particularly described in Schedule 9 [Performance Guarantees and Guarantee Tests] of the EPC Conditions of Contract. No test which is carried out otherwise than in accordance with the procedure described in that Schedule shall be deemed to be a Guarantee Test.

•

Good Performance Guarantee Period means, pursuant to Article 1523 of the Peruvian Civil Code, in respect of completed elements of the Works comprised in each Section, the period commencing on the relevant date of Taking Over and expiring 24 months after that date.

•

Reception means, in respect of the Works or any Section, when all of the following requirements have been satisfied in accordance with Article 1780 of the Peruvian Civil Code. The Contractor must acquire regulations, standards and other bibliographic material necessary to comply with its obligations. (a)

Ready for Start Up Certificate has been issued for the Start-up;

(b)

the Contractor has completed and Commissioned the Works, or the Works comprised in such Section, except for the items on the Punch List, in accordance with all Contract requirements and the Works or such Section comply with applicable Laws;

(c)

either: (i)

the Guarantee Tests have been passed and the Performance Guarantees attained or satisfied; or

(ii)

the Guarantee Tests have been passed and the Performance Guarantees attained or satisfied except only for the Performance Guarantees for which the Contractor has: (A) attained the Minimum Performance Levels; and (B) paid or allowed Penalties for non-execution to the Employer in accordance with the Contract in respect of its failure to attain the corresponding Guarantees;

(d)

the Contractor has supplied the spare parts, special tools and Consumables required to be provided to the Reception under Sub-Clause 7.12 of the EPC Conditions and replaced any spare parts, special tools and Consumables




16. MECHANICAL COMPLETION AND FACILITIES TURNOVER used or consumed during the carrying out of Guarantee Tests which are required to be replaced pursuant to the Contract; (e)

the Contractor has completed its training obligations to be effected prior to Taking Over of the Works or Section for the Employer's Personnel and other nominees of the Employer;

(f)

the Contractor has delivered to the Employer the documents and data required by Sub-Clauses 5.6 and 5.7 of the EPC Conditions; and

(g)

all other requirements or pre-conditions for Taking Over stated in the Contract have been satisfied.

III. COMPLETION AND RECEPTION REQUIREMENTS Contractor shall develop and, subject to EMPLOYER approval, implement detailed completion and turnover procedures for the project. These procedures shall address the following •

EMPLOYER’s Planned Start-up Sequence (Exhibit 16-1),

•

EMPLOYER’s completion and take over Specification (CTS),

•

System completion testing.

Said procedures shall be divided into home office engineering and jobsite functions, satisfying certain minimum requirements as follows: A. Home Office Engineering 1. Immediately upon receipt of the EMPLOYER's Planned Start-up Sequence and approval of Contractor's piping and instrumentation drawings (P&ID's), Contractor shall begin development of a system test program for the project. ANSI B31.3 or the EMPLOYER’s general piping specifications will govern testing requirements. In the case of conflicts, the more restrictive one shall prevail. 2. The test program shall contain a schedule consistent with the above sequence and shall identify on the P&ID's every element and component for each system to be tested. System identification shall be such as to permit coordinated development of both testing and flushing programs for each system. 3. The test program shall designate test pressures, testing media, any limitations, blinding plates requirements, testing equipment, temporary piping, line, and miscellaneous test materials for each system. It should be noted that due to process condition and/or mechanical effort limitations pneumatic tests will be




16. MECHANICAL COMPLETION AND FACILITIES TURNOVER required for certain systems, i.e., Catalyst Circuits, Flare Line, etc. Contractor is responsible for performing all such test related to Contractor’s scope of work. A separate schematic testing diagram shall be produced for each system based on the marked-up P&ID's and test program criteria shown on the piping line list. Said schematic diagram shall reflect applicable testing after system flushing and shall incorporate all pertinent information re: vents, drains, pressure medium, blind plates, accessibility, potential construction interferences, etc. which can be ascertained from the P&ID's and model (if applicable). Said line list will identify hydrotest package number, designate operating pressure, design pressure, test pressure, governing testing code, and any special flushing/cleaning of lines. It should be noted that foreign supplied pipe typically is supplied with a protective paint that if not completely removed can poison the catalysts and potentially produce off-spec products. Therefore, contractor is to insure all associated pipe/fittings associated with the catalyst circuits and final wet end process systems that have internal protective coatings and/or paint are to be internally sandblasted clean to near white finish prior to fabrication. These systems will also require chemical cleaning after associated piping systems are mechanically complete. B. Jobsite Functions 1. Contractor shall program its jobsite completion and testing work in accordance with III.A.3 above. 2. Contractor shall formally request EMPLOYER's inspection prior to testing and/or turnover of any unit, system, or area or equipment. Such requests shall be signed by Contractor's Construction Manager and shall transmit all testing diagrams, drawings, and other relevant data. 3. Following requirements shall govern issuance of interim and final turnover notices by EMPLOYER's Project Manager: a. Notices shall evidence mechanical acceptance and formal transfer defined in II above and shall be accompanied by "punch lists" of unfinished items which are required for Mechanical Completion and Final Acceptance but are deemed by the EMPLOYER's Project Manager to be non-critical to prestart-up activities. These should be generally limited to thermal insulation and painting items. Said punch lists shall contain both Contractor and the EMPLOYER observations and indicated scheduled completion date for each item. b. Notwithstanding the non-criticality of unfinished items in III.B.3.a., notices shall not be issued for areas in which conditions are assessed as




16. MECHANICAL COMPLETION AND FACILITIES TURNOVER hazardous to pre-start-up activity due to concentrations of Contractor personnel, quantities of unfixed materials, etc. c. All items appearing in Contractor's portion of the Mechanical Completion column of the CTS must by definition, be completed prior to certification of Mechanical Completion. d. While the exact format of turnover notices shall be as specified by the EMPLOYER's Project Manager, turnover notices shall require the signatures of Contractor’s Construction Manager, the EMPLOYER's Manager, and the EMPLOYER's Operations and Maintenance Manager. e. Should Mechanical Completion (as verified by EMPLOYER's Representative Construction manager) precede issuance of a turnover notice, Contractor shall be obliged to continue its equipment protective maintenance program (Ref. Project Instruction N° 6, Section II.C) until such issuance. 4. The EMPLOYER may assume the rectification of certain non-critical deficiencies and changes which cannot be completed by Contractor subsequent to interim turnover and prior to start-up may be assumed by Company. These shall be so noted on the final turnover punch list, and appropriate Contract Price adjustments negotiated. 5. Contractor shall be expected to undertake certain corrective work subsequent to issuance of a turnover notice if such work is required through no fault of the EMPLOYER. Contractor shall arrange the coordinations for all subcontractor technical personnel and vendors as required to perform such functions as erection supervision, functional checkouts, and other related duties. CONTRACTOR must comply with all the training activities and elaboration of manuals for the Start up, Commissioning and Guarantee tests of the facilities after the modifications2. The licensors will provide guides of operation and maintenance that have to be reviewed by the FEED-EPC CONTRACTOR; furthermore, they will provide qualified technical personnel for the development of the training activities3. It is important to say that there are no personnel qualified for the Pre-Commissioning

2 3

Question 115 – Round 2. Question 116 – Round 2




16. MECHANICAL COMPLETION AND FACILITIES TURNOVER Phase: The EMPLOYER will be responsible for providing the personnel to be trained4. Should the services of a vendor technical representative be required by the EMPLOYER after release by Contractor, Contractor shall formally transfer supervision of said representative to the EMPLOYER by letter with appropriate copies. The EMPLOYER will then issue instructions to the representative regarding expense recording requirements and assume all costs except travel for return home or to next assignment both of which shall be to Contractor's account. IV. CTS COSTS OF THE COMPLETION AND TAKE OVER SPECIFICATIONS All other Contractor CTS items are provided by Contractor and are included in the Contract Price.

4

Questions 83 and 154 – Round 2.




16. MECHANICAL COMPLETION AND FACILITIES TURNOVER EXHIBIT 16-1 EMPLOYER'S PLANNED START-UP SEQUENCE

EMPLOYER desires the following mechanical completion sequence:

Months Prior to Overall Mechanical Completion

Facility

(TO BE PROVIDED BY COMPANY PRIOR TO CONTRACT AWARD)

NOTES:

1. The EMPLOYER will develop its pre-commissioning and start-up schedule in progressively more detail. Contractor is expected to work closely with the EMPLOYER on plant completion details and to cooperate with the EMPLOYER in achieving construction in the manner and sequence which produces short and efficient start-up and earliest onstream operation. 2. The EMPLOYER plans to issue notices to cover turnover of those facilities or systems which the EMPLOYER needs prior to final turnover.


Drawings and Specifications

Subcontractor and Vendor Technical Support

Permits and Certification

Equipment Identification

G-1

G-2

G-3

G-4

C

C

b. Assist the EMPLOYER in securing all governmentrequired documentation by the Government for startup.

a. Label all equipment items (including instrumentation) in accordance with the EMPLOYER instructions for identification (HIMS Labels), legibility, method, etc.

C

C

b. Supervision of subcontractor and vendor technical personnel as required.

a. Assist the EMPLOYER in securing all governmentrequired documentation for plant construction and operation.

C

C

a. Arrange for all required subcontractor and vendor technical personnel to perform necessary activities at the appropriate stages of construction prior to Mechanical Completion.

a. Inspect entire plant to confirm that erected facilities comply wih all applicable diagrams, and instrumentation, construction drawings, vendor, specifications, and other applicable documents.

A

A

A

A

EXHIBIT 16-2 COMPLETION AND TURNOVER SPECIFICATION (CTS) GENERAL (G) MECHANICAL COMPLETION ACTION REVIEW WITNESS INSPECT ACTIVITY DESCRIPTION


ITEM

NO.


C

ACTION

A

REVIEW

WITNESS

INSPECT

PRE-COMMISSIONING

KEY: A = Company C = Contractor


Rust Preventative Removal and Lubrication

Fireproofing and Thermal Insulation

Painting

General Housekeeping

G-5

G-6

G-7

G-8

a.

a.

Ensure that all accessways, platforms, and operating spaces are clear of debris, tools, other materials, etc. in areas to be started up.

Ensure that minimum amounts of painting scaffolding and numbers of painters remain in areas to be started up.

a. Ensure that all fireproofing and the minimum required thermal insulation for process, heat conservation, and personnel protection have been installed.

b. Install initial charge of lubricants as supplied by the EMPLOYER immediately prior to turnover. Provide the EMPLOYER with record of such installation.

a. Drain or otherwise remove all rust preventatives and oils used for protection during construction. Provide the EMPLOYER with record of such removal.

C

C

C

C

A

A

A

A



ITEM

NO.


C

ACTION

REVIEW

A

WITNESS

INSPECT

PRE-COMMISSIONING



Lighting

Noise

Spare Parts

Flush Water and Test Water Disposal Equipment Protective Maintenance Record

G-10

G-11

G-12

G-13

Ensure that all ladders and platforms have been erected in compliance with applicable drawings and specifications. Ensure that all the thermal expansion movement of all the components can be accommodated. Verify adequacy of all lighting intensities and submit confirmation satisfactory to the EMPLOYER. Verify after startup that noise levels are at or below acceptable limits and submit confirmation satisfactory to the EMPLOYER an paint blue lines defining perimeter of acceptable noise levels. (Contractor to provide plot plan showing results). Ensure that all spare parts for which Contractor is responsible are physically present at jobsite as a prerequisite for Mechanical Completion (Ref. Project Instruction N°5 - Procurement) Dispose of all water used for flushing and/or testing in accordance with the EMPLOYER’s instructions.

a. Provide to the EMPLOYER, at time of equipment turnover, the protective maintenance records for each item being turned over.

a.

a.

a.

a.

b.

a.

C

C

C

C

A

A

A

A



G-14

Ladders and Platforms

ITEM

G-9

NO.


C

C

C

ACTION

A

A

REVIEW

A

WITNESS

INSPECT

PRE-COMMISSIONING



Equipment and Furnishings

Maintenance

SB-2

SB-3

a. Check for completeness of work as shown on drawings. b. Assist the EMPLOYER in securing all necessary certification for building occupancy and use. a. Check installation of all equipment provided by Contractor plus the EMPLOYER-furnished items installed by Contractor. b. Commission air conditioning, lavatories, elevators, etc., and make all performance tests. c. Provide all furniture and business equipment unless otherwise specified. a. Assume building and equipment maintenance upon occupancy. C

C

C

A

A

EXHIBIT 16-2 COMPLETION AND TURNOVER SPECIFICATION (CTS) SPECIFIC BUILDINGS (SB) MECHANICAL COMPLETION ACTION REVIEW WITNESS INSPECT ACTIVITY DESCRIPTION


Note: Energizing will be accomplished only under the EMPLOYER’s permit control. Subsequent work on components or systems which have been energized shall be subject to the EMPLOYER’s permit control procedures.

General

ITEM

SB-1

NO.


A

A

A

C

WITNESS

A

REVIEW

C

ACTION

INSPECT

PRE-COMMISSIONING



Transformers

Switchgear

SE-1

SE-2

b.

h. a.

f. g.

e.

a. b. c. d.

Examine for mechanical damage, oil leaks, etc. Check no-load tap changers for proper movement. Perform oil dielectric tests; specify or furnish oil. Check fan controls and any alarm connections for proper operation. Check fans for correct phase rotation and polarity before energizing. Check for proper tap setting, high and low voltage. Make “megger” test of windings, phase to phase and phase to ground. Check oil level Inspect for damage and missing parts, alignment, clearance of moving parts, etc. Before connecting incoming and outgoing cables, the switchgear shall undergo a 1-minute “megger” test. C

C

C C

A

A

A

A

EXHIBIT 16-2 COMPLETION AND TURNOVER SPECIFICATION (CTS) SPECIFIC-ELECTRICAL EQUIPMENT/MATERIALS (SE) MECHANICAL COMPLETION ACTION REVIEW WITNESS INSPECT ACTIVITY DESCRIPTION


ITEM

NO.


C

C

C

C

C C

ACTION

A

REVIEW

A

A

A

A

WITNESS

A

INSPECT

PRE-COMMISSIONING



Switchgear (Cont’d)

SE-2

c. Witness or perform oil dielectric tests, specify or furnish oil. d. All circuits, bus bar and connections shall display the following minimum resistance: 600 volts 601 volts to 15kV and less 15kV and up 1/2 meg 50 megs 200 megs (Breakers IN) (Breakers OUT) (Breakers OUT) e. Check for proper phase rotation of 1-2-3, counting from; left to right, top to bottom, or front to rear, when viewing from the operating mechanism side. f. Test or check direct trip breakers. g. With breaker in test position, test operation with local, remote and manual operation. h. Test automatic transfer equipment by simulating power failure or under-voltage condition. i. Set relays in accordance with job relay schedule and check operation in trip circuit. j. Check fuse holders for damage and fuses for size and rating. k. Paint or tag all electrical apparatus (push button boxes, connection boxes, etc.) according to the EMPLOYER’s color code or regulations. A A

C C



ITEM

NO.


C

A

A A

C C C

A

C

WITNESS

A

A

REVIEW

C

C

ACTION

A

INSPECT

PRE-COMMISSIONING



Plant Ground System

Transformer or Generator Neutral Resistance Ground Emergency Generator Turbo Generator

SE-4

SE-5

a. (Refer to Operation Manual for activities. Contractor to undertake activities in conjunction with vendor rep.) a. (Refer to Operation Manual for activities. Contractor to undertake activities in conjunction with vendor rep.)

a. Test cables rated at less than 5000 volts with 500 voltmegohm instrument. b. Give high potential test to cables and terminations rated at 5000 volts and above. Test voltage to be 80% of IPCEA factory test values. Cable runs of less than 200 feet may be tested with “megger” in lieu of “hi-pot” test. a. Measure actual resistance to ground at the ground loop or grid. b. Check resistance to ground of all equipment and tank grounds which connect to individual ground rods. c. With simulated ground, check for proper operation of ground detector system. a. Check grounding transformer, resistor, current transformer and relay for size and rating and set relay in accordance with job relay schedule.



SE-7

SE-6

Cables

ITEM

SE-3

NO.


C

C

A

A

A

C C

A

C

A

WITNESS

A

REVIEW

C

C

C

ACTION

A

A

INSPECT

PRE-COMMISSIONING



High Voltage Switchgear Motor Control Center Main Power Supply

SE-8

Induction Motors

SE-12

a. (Refer to Operation Manual for activities. Contractor to undertake activities in conjunction with vendor rep.) a. (Refer to Operation Manual for Activities. Contractor to undertake activities in conjunction with vendor rep.) a. Close main breaker and check phase rotation and voltage. b. Energize feeders. c. Set supply breaker relays and energize supply line. a. Inspect for damage, missing parts, and mechanical operation. b. If oil immersed, check oil level and type of oil. c. Check relay, meter and control systems for continuity. d. Test starter and control circuit with “megger.” e. Operate starter from both local and remote control stations. a. With motor disconnected from load, check bearing lubrication and rotate by hand. b. Perform one-minute “megger” test from phase to phase and phase to ground and dry motors which show unacceptable low values. A

C

C

A

C

A



Motor Starters

SE-11

SE-10

SE-9

ITEM

NO.


C

C C C

A

A A A

A A

C C

A

A

WITNESS

A

REVIEW

C

C

C

ACTION

INSPECT

PRE-COMMISSIONING



Uninterrupted Power Supply (UPS)

SE-13

c. Run motor two hours and check temperature, speed, current, rotation, and vibration or in accordance with vendors requirements. a. Check battery and charger for damage and check electrolyte for level and specific gravity. Adjust charging current and voltage. b. Check emergency generator and automatic transfer equipment for automatic starting, generation and transfer with simulated loss of normal power. c. Check static “no-break” power system for AC & DC input voltage and output AC or DC voltage and verify that output is “no-break” by simulating loss of AC supply and loss of battery. C

A



ITEM

NO.


A

C

A

WITNESS

A

REVIEW

C

C

ACTION

INSPECT

PRE-COMMISSIONING



Electrical Test Records

SE-15

a. Check all terminations for proper and tight connections, check loops for continuity and accidental ground. b. Inspect all terminal boxes for drains and breathers, cable seals and ensure moisture free. c. Check for proper type T/C wire and polarity of connections. d. Pour seals (including area classification isolation seals) Then identify seals have been poured by painting seal plugs with red paint. e. Check power supply and fuses at control board, control loops and field instruments. f. Collaborate with instrument engineer in checking out instrumentation from Provox DCS to field devices. The Contractor shall design and supply the new DCS system to be installed for all the scope of the project, which may come from a manufacturer different from the existing one. a. Provide to the EMPLOYER all records of electrical testing. b. Arrange for government inspections as required. C

A

A

C A

A

C

C

A

C



Electronic Instrument Loops

ITEM

SE-14

NO.


C

C

C

ACTION

A

REVIEW

A

WITNESS

INSPECT

PRE-COMMISSIONING


VOLUME 2 PROJECT INSTRUCTIONS TO PART C SERVICES AND DELIVERABLES - FEED & EPC MASTER JOB SPECIFICATIONS PAGE 18 OF 44 Exhibit 16-2 Page10 of 36 DATE: JULY 13, 2009

Safety

SF-2

a. Check firewater mains, laterals, and hydrants for completeness of installation. b. Hydrotest firewater mains and laterals. As it is mentioned in section 4 of Part C FEED-EPC Services and deliverables of the Master Job Specification (MJS): “It is expected that the selected FEED-EPC Contractor will use these PI’s as a basis for developing its expanded and specific Project Coordination Procedures for the TRM Project”. In this respect, the amendments proposed to Project Guideline 16 Mechanical Culmination and Delivery of Facilities shall be revised with the Successful Bidder. c. Test all fire-fighting equipment (including deluge system). d. Commission and afterward operate firewater mains, laterals, hydrants and other fire-fighting equipment. a. Per Job Specification, either install safety valves or testing dummy spools during construction. b. With the EMPLOYER’s agreement, schedule safety valve testing so that valves are tested no more than sixty days before turnover. c. Remove safety valves from either their installed location or storage and transport to and from third party API Certified test shop Contractor’s test bench. d. Bench test, record, and tag all safety valves. Provide the EMPLOYER with test record.


Fire Protection

SF-1

C

C

A

C

C

C

A

EXHIBIT 16-2 KEY: COMPLETION AND TURNOVER SPECIFICATION (CTS) A = Company SPECIFIC-FIRE PROTECTION AND SAFETY EQUIPMENT (SF) C = Contractor MECHANICAL COMPLETION ACTION REVIEW WITNESS INSPECT NO. ITEM ACTIVITY DESCRIPTION


A

A

C

A

C

WITNESS

A

REVIEW

C

ACTION

INSPECT

PRE-COMMISSIONING



Install (or reinstall) all valves tested in SF-2.d above. Install safety shields. Verify rupture disc. Conduct tests required by code, law or insurance. In accordance with the EMPLOYER Instructions, paint and/or tag all safety equipment including locked/car sealed type and/or locked in accordance with the EMPLOYER’s specifications. j. Seal/lock all block valves designated as car sealed and/or locked valves. k. Test all safety facilities - eye wash fountains, safety showers, etc.

e. f. g. h. i. C

C C A

C A

EXHIBIT 16-2 KEY: COMPLETION AND TURNOVER SPECIFICATION (CTS) A = Company SPECIFIC-FIRE PROTECTION AND SAFETY EQUIPMENT (SF) C = Contractor MECHANICAL COMPLETION ACTION REVIEW WITNESS INSPECT NO. ITEM ACTIVITY DESCRIPTION


C

C

C C

ACTION

A

REVIEW

A

WITNESS

A

INSPECT

PRE-COMMISSIONING


General

ITEM

a. Leak test pneumatic control circuits in accordance with the EMPLOYER’s General Engineering Specifications. b. Inspect the installation and connection of all system components for compliance with Job Specification requirements. Confirm range and function capability using dummy signals as required. c. Collaborate with electrical engineer in checking out electronic loops, electrical signals, alarms, etc. d. Check thermocouples for proper installation and operation. e. Calibrate instrument and control systems in accordance with the EMPLOYER’s General Engineering Specifications; tag and record instruments as they are calibrated. f. Set all switches in accordance with instrument data sheets. g. Set all controllers with preliminary modes of tuning in accordance with the EMPLOYER’s General Engineering Specifications. h. Blow down and tightness check all instrument air lines and tubing immediately before commissioning. i. “Tune” instruments when process fluids are available. (Finalize control mode settings).

C

A

A A

C

C C

C

A

A

EXHIBIT 16-2 COMPLETION AND TURNOVER SPECIFICATION (CTS) SPECIFIC-INSTRUMENTATION EQUIPMENT/MATERIALS (SI) MECHANICAL COMPLETION ACTION REVIEW WITNESS INSPECT ACTIVITY DESCRIPTION


SI-1

NO.


A A

C

A

C

C

A

C

WITNESS

A

REVIEW

C

ACTION

INSPECT

PRE-COMMISSIONING



Orifice Plates

SI-3

b. Install devices after cleaning/flushing and carry out hydrostatic testing. a. Check material, measure the orifice with inside micrometer, check against data sheets, and tag. b. Deliver orifice plates to the EMPLOYER for installation. c. Install orifice plates after completion of line flushing.

a. Install Blind-off or isolate the pipes during the hydrostatic tests; do not run on water. As it is mentioned in section 4 of Part C FEED-EPC Services and deliverables of the Master Job Specification (MJS):”It is expected that the successful FEED-EPC Contractor will use these PIs as a basis for developing its expanded and specific Project Coordination Procedures for the TRM Project.” In this respect, the amendments proposed to Project Instruction 16 Mechanical Culmination and Facilities Turnover shall be revised with the Successful Bidder5.

C

C

A

C

C

C

C

A

A

A

A

A

C

WITNESS

A

REVIEW

C

ACTION

INSPECT

PRE-COMMISSIONING



Questions 69, 70, 71,72, 73, 74, 75, 76, 77, 78, 79, 80, 81, 82, 83, 84, 85, 86, 87, 88, 89, 90, 91, 92, 93, 94, 95, 96, 96, 97 y 99 – Round 1.

Positive Displacement Flow Meters (& Other Inline Components inside the pipes)

SI-2

Blow down and the adjument of the main piping of the processes after line flushing. k. Install seal fluids where required. l. Provide instrument loop diagram at least three months before turnover.

j.



5

ITEM

NO.


Torque Tube type Level Devices Float type Switches Gage Glasses Pressure Gages Local Thermometers Hand Control Valves

SI-4

Positioners

SI-11

a. Actuate each valve manually to insure that it strokes properly through 100% range. b. Lubricate as required. a. Actuate each valve manually to ensure that it strokes properly through 100% range. b. Lubricate as required. a. Check manual linkage.

a. No calibration required; check mechanical movement comparing it with an output. a. Clean and check the illuminators devices. a. Install immediately prior to turnover due to the exposure to damage during construction. a. Same practice as for pressure gages.

a. Check mechanical operation and direction.

C

C

A

A



Control Valves

SI-10

SI-9

SI-8

SI-6 SI-7

SI-5

ITEM

NO.


C

A

C C

A

A

A

WITNESS

A

REVIEW

C

C

C C

A

ACTION

A

A

A

INSPECT

PRE-COMMISSIONING



Atmospheric Tankage

ITEM

a. Conduct hydrostatic testing of tank and internal piping in accordance with Job Specification. b. After testing, clean and dry tank. As it is mentioned in section 4 of Part C FEED-EPC Services and deliverables of the Master Job Specification (MJS): “It is expected that the selected FEED-EPC Contractor will use these PI’s as a basis for developing its expanded and specific Project Coordination Procedures for the TRM Project”. In this respect, the amendments proposed to Project Guideline N° 16 Mechanical Culmination and Delivery of Facilities shall be revised with the Successful Bidder. c. Secure all holes of access in accordance with the EMPLOYER’s vessel closure procedure. d. Cubing tank and issue record to the EMPLOYER. (Where required by Government regulations, the EMPLOYER shall undertake independent cubing of the tank, and Contractor shall assist as required). e. Install all items whose installation was restrained by the testing, and complete painting. C

EXHIBIT 16-2 COMPLETION AND TURNOVER SPECIFICATION (CTS) SPECIFIC-MECHANICAL EQUIPMENT (SM) MECHANICAL COMPLETION ACTION REVIEW WITNESS INSPECT ACTIVITY DESCRIPTION


SM-1

NO.


C

A

A

INSPECT

C

A

WITNESS

A

REVIEW

C

C

ACTION

PRE-COMMISSIONING



Boilers

ITEM

a. Perform a nonoperating (cold hydrostatic) test on boiler pressure components in accordance with Job Specification and applicable codes, draining test water completely on completion. As it is mentioned in section 4 of Part C FEED-EPC Services and deliverables of the Master Job Specification (MJS): “It is expected that the selected FEED-EPC Contractor will use these PI’s as a basis for developing its expanded and specific Project Coordination Procedures for the TRM Project”. In this respect, the amendments proposed to Project Guideline N° 16 Mechanical Culmination and Delivery of Facilities shall be revised with the Successful Bidder b. Undertake air leakage air in the complete structure. c. Inspect for completeness and compliance with all applicable drawings and specifications. d. Verify that thermal expansion of all components and piping can be accommodated. Provide the EMPLOYER with record of this verification. e. Check flare and ductwork for cleanliness and check boiler damper for positioning and travel. Secure the flare and ductwork. A

A

C

C



SM-2

NO.


C

A

A

C

WITNESS

A

REVIEW

C

ACTION

INSPECT

PRE-COMMISSIONING



Boilers (Cont’d)

ITEM

h. Cure refractory in accordance with vendor recommendations. i. Check out safety supervisory system and all other instrumentation. j. Following satisfactory run-in of matrix drivers and directional checks of fans, couple drivers and fans. k. Commission fans and drivers, as per SM-3. Verify satisfactory operation of air entries and check vibration. l. Charge with treated for blow with the equipment steam. m. Commission steam main conducts as necessary. n. Per vendor instructions and Contractor’s procedures, perform dry out, boil out, and chemical cleaning as applicable. o. Following completion of SM-2.n, inspect drum internal surfaces, removing any and all debris. Providing supervised labor, open, clean, inspect and secure boilers. p. Repeat SM-2.a, using treated water.

Check control valves and soot blowers for satisfactory operation. g. Develop dry out procedure in accordance with vendor recommendations (Submit said procedure to the EMPLOYER and review same with the EMPLOYER no later than ninety days prior to start of dry out).

f. C

A



SM-2

NO.


C

A

A A

C C C

C

A

C

A

A

A

WITNESS

A

REVIEW

C

C

C

C

ACTION

A

INSPECT

PRE-COMMISSIONING



Compressors (Also, Fans & Blowers as Applicable)

Compressors (Also, Fans & Blowers as Applicable) (Cont’d)

SM-3

SM-3

q. Carry out the hot blow and hot adjustment of the security valves. r. Final check and adjust instrumentation and control systems. s. Carry out manually effect load changes to establish boiler response. t. Verify satisfactory operation of safety shutdown capability. u. Demonstrate guaranteed test. a. Install compressor interconections in accordance with vendor tolerances. Adjust as needed to alleviate potential stresses. b. Make cold alignment of compressor and driver to vendor tolerances, providing record to the EMPLOYER. c. Ensure all compressor suction piping and lube and seal oil piping are turned over in clean condition, i.e., free of debris, mill scale, etc. d. Pickle all compressor suction piping and lube and seal oil piping in accordance with Job Specification. Dispose of waste per the EMPLOYER instructions. C

C

A

A



ITEM

NO.


C

C

A

C

A

A

WITNESS

A

REVIEW

C

C

C

C

ACTION

A

INSPECT

PRE-COMMISSIONING



ITEM

e. Charge the lube oil, seal oil, and all cooling systems with flushing oil and circulate until the level of cleanliness required by Job Specification has been attained. When cleaning is completed, dispose of spent flushing oil per the EMPLOYER instructions. f. Charge lube oil, seal oil and oil cooling systems with operating oil supplied by Company. Provide the EMPLOYER with record. g. Following satisfactory run-in of the motors and the check of compressor, couple the two elements. h. Install temporary suction strainers as required. i. Remove, clean, and reinstall temporary strainers to remove dirt, debris, etc. j. Commission piping system required for run-in. k. Operate equipment and prove the vibration devices,, temperature, trip, governor & safety device checks. Adjustments as needed. l. Check water content and for water and other contaminants on the oil systems m. Perform hot alignment and any required hot doweling. n. Correct deficiencies uncovered during compressor run-in. o. Remove all temporary suction strainers, screens, etc., after a reasonable period of operation. p. Check out auxiliaries, control systems, alarms, signals, and shutdown components. C

A



NO.


A A

C C

A A

A

C C C C

C

A

A

C

C

A

C

WITNESS

A

REVIEW

C

ACTION

INSPECT

PRE-COMMISSIONING



Furnaces

SM-4

a. Perform a non-operating (cold hydrostatic tests) of the pressure components in accordance with Job Specification and applicable codes, completely draining test water and air blowing upon completion. b. Inspect for completeness and compliance of the works with all applicable drawings and pertinent specifications. c. Blow fuel lines, check lines for cleanliness, and connect burner piping. d. Verify that thermal expansion of all components and piping can be accommodated. Provide the EMPLOYER with record of this verification. e. Check operation of all trip regulators, air inputs, and soot blowers. f. Develop dry out procedure in accordance with vendor recommendations. A

A

C

C

C

A



ITEM

NO.


C

C

C

ACTION

REVIEW

A

A

A

WITNESS

INSPECT

PRE-COMMISSIONING



ITEM

g. Cure refractory in accordance with vendor recommendations. h. Check out furnace instrumentation. i. As applicable, commission blowers and motors as per SM-3. Verify satisfactory operation of air inputs registers and check vibration. j. Per vendor instructions and Contractor’s procedures, perform dry out, boil out and chemical cleaning as applicable. k. Final check and adjust instrumentation and control systems. l. Perform light off the systems, drying, and purging. m. Verify satisfactory operation of safety shutdown capability.



NO.


A

A

A

A

C

C

C C C

WITNESS

A

REVIEW

C

ACTION

INSPECT

PRE-COMMISSIONING



Flare Stacks

Mechanical Drivers

SM-6

SM-7

b.

a.

Set and cold align turbine and associated piping, or adjust hot set as recommended by vendor. Furnish record of this alignment to EMPLOYER. Remove rust preventatives, oil, grease, etc., used to preserve the equipment during construction. Provide the EMPLOYER with record of such removal.

Fill basin and correct any leaks, draining and refilling if necessary. e. Cooling tower water conditioning. f. Run-in motors per Job Specification. g. Couple motors to fans, start-up, and check vibration. h. Run-in and guarantee test tower. Shell and Tube a. As required by government regulations, perform field testing of exchangers.. b. Ensure that thermal movement can be accommodated a. Check flare piping and burner installation for optimum operation. b. Blow out steam and fuel gas piping. c. Light pilots. d. Establish levels in seal vessels. Small Steam Turbines

d.

C

C

A

A



ITEM

NO.


A

C

C C C

C C

A A

C C C C

WITNESS

A

REVIEW

C

ACTION

A

A

A

INSPECT

PRE-COMMISSIONING



Flare Stacks

Mechanical Drivers

SM-6

SM-7

d. Fill basin and correct any leaks, draining and refilling if necessary. e. Cooling tower water conditioning. f. Run-in motors per Job Specification. g. Couple motors to fans, start-up, and check vibration. h. Run-in and guarantee test tower. Shell and Tube a. As required by government regulations, perform field testing of exchangers.. b. Ensure that thermal movement can be accommodated a. Check flare piping and burner installation for optimum operation. b. Blow out steam and fuel gas piping. c. Light pilots. d. Establish levels in seal vessels. Small Steam Turbines a. Set and cold align turbine and associated piping, or adjust hot set as recommended by vendor. Furnish record of this alignment to EMPLOYER. b. Remove rust preventatives, oil, grease, etc., used to preserve the equipment during construction. Provide the EMPLOYER with record of such removal. A

A

C

C



ITEM

NO.


A

C

C C C

C C

A A

C C C C

WITNESS

A

REVIEW

C

ACTION

A

A

A

INSPECT

PRE-COMMISSIONING



ITEM

c. Put Company-supplied lubricants. Provide the EMPLOYER with record of such installation. d. Install all permanent packing and accessories. e. Install temporary strainers as required. f. Remove, clean and reinstall temporary strainers to remove dirt, debris, etc. g. Commission steam supply lines. h. Check and run-in turbines and maintain them after turnover. i. Check operation and setting of overspeed trips when uncoupled. j. Check bearing temperatures, vibration, etc., in operation. k. Make final hot alignment check after driver equipment run-in and coupling to driven equipment. l. Remove temporary strainers. m. Check over-speed trips and shutdowns after coupled to associated equipment. C C

A A



NO.


C C

C

C

C

A

A A

C C

WITNESS

A

A

REVIEW

C

C

ACTION

INSPECT

PRE-COMMISSIONING



Mechanical Drivers (Cont’d)

SM-7

Remove, clean, and reinstall temporary strainers to remove dirt, debris, etc. g. Charge lube oil and seal oil systems with flushing oil and circulate. When cleaning is completed, dispose of spent flushing oil per the EMPLOYER instructions. h. Charge lube oil and seal oil systems with operating oil supplied by the EMPLOYER. Provide Company with record.

f.

Large Steam Turbines a. Install turbine piping in accordance with vendor tolerances. Adjust as required to alleviate potential stresses. Provide record of parallel flange alignment to the EMPLOYER. b. Make cold alignment of turbine and driven equipment to vendor tolerances, providing record to the EMPLOYER. c. Ensure all control, lube oil and seal oil piping is turned over in clean condition, i.e., free of debris, mill scale, etc. d. Pickle all control, lube oil and seal oil piping in accordance with Job Specification. Dispose of waste per the EMPLOYER instructions. e. Install temporary strainers, permanent packing, mechanical seals, and accessories as required. A

A

C

C




ITEM

SM-7

NO.


C

A

C

A

WITNESS

A

A

REVIEW

C

C

C

C

ACTION

A

A

INSPECT

PRE-COMMISSIONING



Pumps

SM-8

Operate and verify device vibration, bearing temperature, trip, governors, and safety device checks. Make adjustments as required. Check for water content or other contaminants in oil systems. Correct all deficiencies uncovered during turbine run-in. Couple the motor or driven equipment. Perform hot alignment and any other required adjustments. Check out auxiliaries, control systems, alarms, signals, and automatic shutdown components. Remove all temporary strainers, screens, etc., after a reasonable period of operation. Set and cold align pumps and drivers in accordance with the EMPLOYER Standards; or approximate hot set as recommended by vendor. Furnish record of this alignment to the EMPLOYER. Check drivers for rotation and run-in. Couple pumps to drivers after drivers have been run-in.

j.

b. c.

a.

p.

o.

l. m. n.

k.

Commission steam supply lines.

i.

C

A




ITEM

SM-7

NO.


C C

C

C

C C C

C

C

C

ACTION

REVIEW

A A

A

A A A

A

A

WITNESS

INSPECT

PRE-COMMISSIONING



Pumps (Cont’d)

SM-8

d. Remove rust preventatives, oil, grease, etc., used to preserve the equipment during construction. Provide record of such removal to the EMPLOYER. e. Install the EMPLOYER-supplied lubricants. Provide Company with record of such installation. f. Install temporary packing if permanent packing is not suitable for flushing. (Contractor to show on diagram he instrumentation and piping if required). g. Install temporary strainers in suction piping. h. Make final check of cold alignment. i. Check all vents, drains, seals, flushing bypasses, etc. for conformance to specifications, overpasses flushing drawings and. Checkout and fill pump seals in accordance with the EMPLOYER’s Standards. j. Check alignments, bearing temperatures, vibration, etc., during flushing operation; report any malfunctions to Contractor. Check and run-in pumps, maintain them after turnover. k. As necessary, remove, clean, and replace pump screens to remove dirt, debris, etc. A

A

C C C

A

A

A

C

C



Pumps (Cont’d)

ITEM

SM-8

NO.


C

C

C

ACTION

A

REVIEW

A

WITNESS

INSPECT

PRE-COMMISSIONING



Pressure Vessels

SM-9

n. Remove temporary strainers after pumps have been in operation for a reasonable period. o. Remove temporary strainers after pumps have been in operation for a reasonable period. a. Blow dry all vessels and perform a non-operating pressure test on all field erected vessels in accordance with applicable codes and Job Specification. b. Develop a cast able curing and dry out procedure in accordance with vendor recommendations. (Submit said procedure to the EMPLOYER and review same with the EMPLOYER no later than ninety days prior to start of dry out). c. In accordance with Job Specification, install vessel internals and perform tray leakage tests (tightness).

Maintain all firewater or other permanent service pumps used for water supply during construction as above. Return pumps in first class condition. m. Perform final hot alignment check.

l.

C

C

A



Pumps (Cont’d)

ITEM

SM-8

NO.


C

A

C

C

C

ACTION

REVIEW

A

A

WITNESS

A

INSPECT

PRE-COMMISSIONING



Pressure Vessels (Cont’d)

ITEM

(2) For vessels loaded by Contractor. h. If required by the EMPLOYER, provide and supervise labor to open, clean, and secure vessels during and after flushing.

d. Install, curve, and cure the refractory linings per the approved procedure. e. Ensure each vessel is thoroughly cleaned of all debris and foreign materials. f. When all work is completed to the EMPLOYER’s satisfaction, issue closure form of the team. g. Secure all vessel internal man-ways and external openings in accordance with the EMPLOYER’s checkout procedure on receipt of the EMPLOYER’s closure form approval, subsequent to final inspection or charging with catalyst, chemicals, etc., as follows: (1) For vessels loaded by the EMPLOYER.

C



SM-9

NO.


C C

C

A

C

ACTION

REVIEW

A

WITNESS

A

A

INSPECT

PRE-COMMISSIONING



Packaged Process preassembled Equipment and Special Plants

SM-11

a. Install all miscellaneous mechanical equipment such as loading arms, loading racks, mixers, filters, agitators, scales, cranes, fans, etc. b. Install, lubricate as required, perform mechanical checks and adjust all equipment prior to turning over to the EMPLOYER. c. Calibrate all solids weighing and measuring devices in their field installed operating positions in accordance with the EMPLOYER’s Standards. Furnish record of all calibration data to the EMPLOYER. d. Test all lifting equipment in accordance with insurance requirements and/or government codes. e. Test run to verify for conformance with the EMPLOYER’s vibration requirements and set monitoring devices. Verify clearances within the EMPLOYER and/or Vendor specifications. Measure noise levels for conformance with the EMPLOYER’s Standards. Furnish records of all verification records. f. Have all in-line filter elements removed for hydrotesting by certified vendor representatives. a. Inspect for completeness and compliance with all applicable drawings and specifications. b. Carry out checks in accordance with the appropriate sections of the CTS and vendor instructions. A

A

C C

A

C



Misc. Equipment

ITEM

SM-10

NO.


C

A

A

C

WITNESS

A

A

REVIEW

C

C

C

ACTION

A

INSPECT

PRE-COMMISSIONING



Water Treatment Plants (Cont’d)

Waste Treatment and Disposal

SM-12

SM-13

d. Load all catalysts and chemicals in accordance with Section SO of the CTS. e. Perform necessary operating checks and commission plant. a. Inspect for completeness and compliance with all applicable drawings and specifications. b. Carry out checks in accordance with the appropriate sections of the CTS and vendor instructions. c. Load all catalysts and chemicals in accordance with Section SO of the CTS. d. Perform necessary operating checks and commission plant.

c. Load all catalysts and chemicals in accordance with Section SO of the CTS. d. Perform necessary operating checks and commission plant. a. Inspect for completeness and compliance with all applicable drawings and specifications. b. Carry out checks in accordance with the appropriate sections of the CTS and vendor instructions. c. Check out automatic cycle timing equipment.

C

C

A

A



Water Treatment Plants

ITEM

SM-12

NO.


A

C C

A

A

C

C

C

A

C

A

WITNESS

A

REVIEW

C

C

C

ACTION

INSPECT

PRE-COMMISSIONING



Procurement

Installation

SO-1

SO-2

a. The Contractor shall procure all catalysts, chemicals, desiccants, Raschig rings, inert balls, etc., as noted in Responsibility Interfaces, Sections IV and XI. a. Verify cleanliness of all vessels prior to installation of chemicals, catalysts, etc. b. Install initial charge of chemicals supplied by vendor with equipment. c. In accordance with the EMPLOYER’s schedule and direction, supply and supervise labor to load materials for equipment other than that in SO-2.b. d. Air blow as necessary. e. Inspect during and after loading to ensure proper installation, obtaining catalyst samples in accordance with Company’s Procedures.

A

EXHIBIT 16-2 COMPLETION AND TURNOVER SPECIFICATION (CTS) SPECIFIC-OPERATING CHEMICALS AND MATERIALS (SO) MECHANICAL COMPLETION ACTION REVIEW WITNESS INSPECT ACTIVITY DESCRIPTION


ITEM

NO.


C C

A

C

WITNESS

A

REVIEW

C

C

ACTION

A

INSPECT

PRE-COMMISSIONING



Installation

SP-1

a. In accordance with Job Specification, provide and install all required blanks and strainers, both permanent and temporary. As specified by the EMPLOYER, provide and install other start-up blanks. b. Remove, clean, and replace strainers as required to remove dirt, debris, etc. c. Verify that valve packing and lubrication satisfy Job Specification. d. Provide and apply line identification by sign, tag, and stencil per the EMPLOYER instructions. e. Provide the EMPLOYER with record of installed blinds and strainers. f. Retorque piping and equipment bolts. g. Commission spring hangers and supports subsequent to hydrostatic testing and provide setting data to the EMPLOYER. • Cold Set • Hot Set h. Check pipe anchors and guides for compliance with piping flexibility requirements. A

C

A

C A

A

C

C

A

C

EXHIBIT 16-2 COMPLETION AND TURNOVER SPECIFICATION (CTS) SPECIFIC-PIPE AND PIPING MATERIALS (SP) MECHANICAL COMPLETION ACTION REVIEW WITNESS INSPECT ACTIVITY DESCRIPTION


ITEM

NO.


C C C

C

C

ACTION

A

REVIEW

A

WITNESS

A

INSPECT

PRE-COMMISSIONING



Flushing (Cont’d)

SP-2

b. Supply and supervise labor and provide all tools required to undertake water flushing/air drying operations in a. above. Said operations shall include, but not be limited to, removing debris and blowing lines, installing temporary blanks, strainers, and piping; dropping control valves, spool pieces, and soft seat valves, etc. (Additionally, Contractor shall subsequently reassemble piping and repair thermal insulation and painting damaged by the flushing/air drying.)

Check hangers, pipe anchors, and guides during startup to verify that thermal movement has been accommodated to the thermal expansion. j. Install corrosion probes. k. Remove temporary strainers. l. Tighten/Repack all valves in VOC hydrocarbon service. Valves in other services tighten/repack as required. a. In accordance with the EMPLOYER’s Planned Startup Sequence (Exhibit 16-1, latest issue), schedule and direct water flushing/air drying operations.

i.

C

C

A

A



Flushing

ITEM

SP-2

NO.


C

C C

C

ACTION

A

REVIEW

A

WITNESS

A

INSPECT

PRE-COMMISSIONING



Testing

ITEM

c. Provide and install all replacement gaskets, hoses, temporary piping and spool pieces, equipment, and other items required for flushing/air drying operations (Ref. Responsibility Interfaces, Section IV). a. In accordance with Job Specification and Contractor’s test program, pressure test all piping. Ensure that all permanent supports have been installed. b. Perform all operational dryout and leak/tightness testing. c. Correct all deficiencies noted during tightness testing.



SP-3

NO.


C

C

C

C

ACTION

REVIEW

A

A

A

WITNESS

INSPECT

PRE-COMMISSIONING





17. MODELS I.

OBJECTIVE This instruction addresses requirements of models to be constructed by Contractor in accordance with these Project Instructions. The development and use of a 3D computer model is covered in Section II hereof. In addition to the 3D model, the Contractor should prepare some physical models (hard and made of plastic), taking into consideration the global scope of the Project 1 and following the instructions contained in Section III and IV of this Instruction .

II. 3D COMPUTER AIDED DESIGN (CAD) MODELS2 A. Purpose The 3D CAD Model is intended to be a computer aided design tool for all home office engineering disciplines. Although beneficial for other uses such as field construction, start-up and operator training, these shall be considered supplemental. The 3D Model shall be developed under the supervision of Contractor's design personnel in Contractor's home office and shall, with respect to timing, fully support Contractor's detailed engineering effort. It shall contain only the amount of detail required to produce accurate and complete working drawings. As such, these documents shall be a scale replica of the entire facility for which the tool is being used. The drawings and diagrams for engineering and construction will be elaborated and delivered using an integrated system of database and graphic platform, using TM (Plant Design Management System) or similar. The process the PDMS diagrams (P&ID, PFD, plot plan, one-circuit distribution, etc) shall be elaborated using “2D intelligent technology” following the standard ISO 15926. It is important to emphasize that the pipings and instruments supports may be omitted from the 3 scope of the models . The product or suite that the Contractor shall use for the development of the intelligence technology in 2 dimensions shall generate automatically outcome files which comply with the ISO 15926 standard. The generation of the drawings in 2D shall use a graphic platform in (AutoCad or equivalent), the drawings may be elaborated working in a local or remote manner.

1

Question 28 – Round 1 and 112 – Round 3. Questions: 49 – Round 1 (Information more detailed shall be provided to the successful Bidder) and 111 Round 3. 3 Question 50 – Round 1. 2




17. MODELS The drawings shall be subject to a verification of consistency of the drawing 4 elements . The application used to be able to interrogate and display drawings generated in the graphic platform, including specific information and each element represented in the diagram of two dimensions. This information should be stored in a database which does not permit the repetition of elements with the same identification or label number, each and all of the records shall be stored showing the state in force and representing all the life cycle of the installation. The information contained in the database, must be able to be extracted in the form of fact sheets, lists and reports, using an interface itself and exported to some software. Nowadays, the information with respect to the plans and technical documents is available in electronic form (autocad), scanned and printed in paper. There are no 3D models for the existing units5. The electronic versions of the tool should be the latest; this version must now be used in similar industries (Oil & Gas) in the American continent. The developer and owner of the technology must recommend the most functional and optimum version for the project. The CONTRACTOR shall propose the appropriate system and the EMPLOYER shall approve. Also, the CONTRACTOR shall provide to the EMPLOYER, at the beginning of the FEED effort, the software packages and at least three licensees in order to allow the EMPLOYER to review the drawings and diagrams developed by the EMPLOYER. A workstation system is also required. The Licenses shall be located at the places indicated by the EMPLOYER and at least one of the licenses 6 shall be located at the EMPLOYER’s offices . The CONTRACTOR shall elaborate new drawings of the existing facilities using 3D scanning surveying technology. The CONTRACTOR may subcontract laser survey of the existing facilities to a company specialized in laser survey, following the Contract procedures. As this activity is within the CONTRACTOR’s obligations scope, the CONTRACTOR will be responsible for the execution of the laser surveys. It is confirmed that underground facilities are excluded from laser survey7.

4

Question 29 – Round 1. Question 243 - Round 1. 6 Question 208- Round 1 7 Question 119 – Round 3. 5




17. MODELS As well, it is confirmed that the 3-dimension scanning technology refers to the development of the 3D model starting from dotted cloud data obtained from the laser scanning system, and that the scope of the Contractor’s work includes the development of 3D models and the extraction of the Refinery isometric plans of both the upgraded and new facilities8. B. Description and Content Contractor shall utilize a 3D Model for all of the project's facilities, Contractor shall describe the system they use and how they intend to utilize it for the project. The Employer shall approve the program to be used. 1. Work Flow Diagram To illustrate how Contractor's 3D Model designs evolve, Contractor is required to develop a work flow diagram that delineates the entire process from database development through to issuance of approved for construction documents. This will include prerequisite information requirements and a list of deliverables (Intelligent P&ID's, Plot Plans, Isometrics, Electrical Routing Diagrams, etc.) and when produced during the design development. 2. Complementary Software Contractor to identify complementary software systems to be utilized for completing designs. Contractor shall demonstrate to the EMPLOYER’s satisfaction that system(s) and database “attributes” to be utilized by Contractor are compatible with those system(s) currently used by the EMPLOYER. 3. Clash Reviews One of the major benefits of 3D Models is the ability to identify design interferences. Contractor is to identify system's clash review capabilities and how interdisciplinary designs are checked for interferences (i.e., structural secondary supports, pipe, electrical and instrumentation, etc.). 4. Plant Walk-Through Feature To facilitate model review, Contractor's system should have a plant walkthrough feature that allows Contractor/EMPLOYER to fully visualize access and operability of facilities.

8





17. MODELS 5. Deliverables Contractor to identify all the deliverables to be issued by 3D Model, including but not limited to description and/or example of the following content. As a minimum, the model shall contain the following: a. All process and process piping and utilities, properly identified with thermal insulation and heat veins so designated; b. All valves, including hand wheels and valve actuators; c. All equipment items, including firefighting (monitors, hydrants and hose reels); d. All buildings and structures including smokestacks, pipe racks, supports, etc. with fireproofing requirements indicated; e. Engineered pipe supports; f.

Transformers and switchgear;

g. Electrical and Instrument major raceways; h. All instrumentation, properly identified; i.

Handrails and ladder cages.

The instrumentation piping may be omitted from the scope of the models. All equipment, instrumentation and piping shall be shown to scale. Following items are to be shown in location on the model base: a. Roadways, accessways, and site drainage scheme; b. Foundation limits; c. Underground facilities and utilities. The following miscellaneous and standard details are representative of those items which may be omitted: a. Miscellaneous pipe supports; b. Instrument piping; c. Lighting.




17. MODELS 6. Early Bulk Material Take-offs Contractor shall describe when and how early bulk take-offs will be conducted and reconciliation made to model's final material lists. 7. Data Protection Contractor to describe data protection measures. As a minimum, system shall have a dual server and be backed up daily to protect against system failures and corruption of data. C. Model Reviews The EMPLOYER shall have free access to the Model at all times and Contractor shall provide at least one work station from which the EMPLOYER will have access in addition to undertaking the following formal reviews: 1.

Interim review when Model is approximately 30% complete, with equipment and major piping included;

2.

Interim review when model is approximately 60% complete with additional structural piping and electrical details.

3.

Final review when Model is 90% complete, prior to production of piping isometrics drawings.

4.

Operability, safety and maintenance reviews as and when deemed necessary by the EMPLOYER's Project Manager.

Contractor shall coordinate, schedule and fully document the results of formal reviews. D. Post-Engineering Utilization To maximize the use of the Model during construction, Contractor is to make a 3D Model work station available at the Site, for use by construction subcontractors in constructability planning and construction coordination. E. Handover Upon completion of the project, Contractor shall hand-over the latest copy of the model in its native format, including database information with “attributes”. Contractor to provide engineering drawing, as determined by the EMPLOYER, converted to be compatible with the EMPLOYER's in-house CAD system.




17. MODELS 9

III. HARD, PLASTIC BLOCK MODELS A. Purpose

If Requested by the EMPLOYER’s Project Manager, Contractor shall construct, to a scale agreed upon by EMPLOYER's Project Manager, a preliminary model to determine the plot plan and equipment relationships. The model shall be in block form to represent units, major items, buildings, roadways, etc. B. Review and Utilization Upon completion of said model, Contractor shall solicit the EMPLOYER's review, comments, and approval in order to finalize plot development. Contractor shall subsequently, submit for the EMPLOYER approval a plot plan drawing based on the approved preliminary model. Following receipt of said plot plan approval, Contractor shall begin preparing the detailed model as in Section III below. IV. HARD, PLASTIC DETAILED MODELS A. Purpose The detailed model is intended to be a detailed design tool for all home office engineering disciplines. Although beneficial, other uses such as field construction, start-up, and operator training shall be considered supplemental. The detailed model shall be constructed under the supervision of Contractor's design personnel in Contractor's home office and shall, with respect to timing, fully support Contractor's detailed engineering effort. It shall contain only that amount of detail required to produce accurate and complete working drawings. As such, it shall not be a scale replica of the entire facilities it represents but only of those portions requiring accurate definition. The CONTRACTOR will start the construction of the model (mock up) with the FEED elaboration, and terminate with the detail engineering so that before the construction the model is available10, considering all the Project Scope (docks, offsite, ISBL) during the FEED Phase11. B. Description and Content 1. The detailed model shall be built to a scale of 3/8" to 1' - 0", and shall contain the following representative items, all of which may utilize approximate standard model components to indicate location and size requirements: 9

Question 176 – Round 3 (It will be accepted the reception of the plastic models budgets as part of the FEED Early Works). 10 Question 153.1 - Round 2. 11 Question 153.2 - Round 2




17. MODELS a. All process piping, properly identified and color coded with thermal insulation and heat veins so designated; b. Auxiliary piping 2" diameter and larger, likewise identified, color coded, etc; c. All valves; d. All equipment items including firefighting; e. All buildings and structures including stacks, pipe racks, main supports, etc. with fireproofing requirements indicated; f.

Transformers and switchgear;

g. All instrumentation, properly identified. All piping 2" diameter and larger shall be shown to scale. Contractor shall utilize plastic piping components exclusively.

In this regard,

2. Following items are to be shown in location on the model base: a. Roadways, accessways, and site drainage scheme; b. Foundation limits; c. Underground facilities and utilities. 3. Following miscellaneous and standard details are representative of those items which may be omitted: a. Handrails and ladder cages; b. Miscellaneous pipe supports; c. Instrument piping; d. Equipment shafts, flanges, and pedestals. C. The EMPLOYER The EMPLOYER shall have free access to the model at all times in addition to undertaking the following formal reviews with Contractor: 1. An interim review at approximately the 70% completion of model; 2. A final review when the model is 90% completed;




17. MODELS 3. Operability, safety, and maintenance reviews as and when deemed necessary by the EMPLOYER's Project Manager. Contractor shall coordinate, schedule, and fully document the results of all formal reviews. D. Photographs Contractor shall photograph the completed final model for record purposes in accordance with instructions from the EMPLOYER's Project Manager and provide the EMPLOYER with six (6) sets. E. Post-Engineering Utilization Upon completion of its usefulness as a design tool, the detailed model shall be transported to Site for use as an aid in field construction, start-up, operator training, etc. Prior to shipment, however, Contractor shall review with the EMPLOYER's Project Manager: 1. Shipping details, including means of transportation, insurance coverage, etc.; 2. Provision for placement at Site in such manner as to ensure the model's safety and security. Contractor shall ensure that all subsequent engineering changes are duly incorporated into the model at Site. F. Maintenance Contractor shall promptly repair all damage and replace any missing components. G. Handover Subsequent to Mechanical Completion, the model, with any major damage repaired and all missing major components replaced, shall be handed over to the EMPLOYER.




18. COMPILATION OF PROJECT DATA I.

OBJECTIVE This instruction covers requirements for various technical data to be compiled by Contractor. When completed, said compilation will form a comprehensive source of information to assist the EMPLOYER personnel in start-up and production operations, maintenance, trouble-shooting, and future improvements. Said compilation will be in three parts: The CONTRACTOR shall design a system that allows having an electronic way, as supporting information, all the documents and the data that have been generated during the execution of Project with the elements of security and adequate access that shall be approved by the EMPLOYER, this system shall be permanently upgraded and keeping by the CONTRACTOR and with access to the EMPLOYER or EMPLOYER Representative. The compilation consists of three parts: Project Record Books consisting of consecutively numbered volumes of relevant data for the overall plant and each design specification unit and system (process, utilities, and offsites); Equipment Reference File consisting of consecutively numbered volumes, arranged by design specification unit or system, of data for each major equipment category item within the design specification; and Operating Instructions consisting of step-by-step instructions for safe start-up, onstream operations, and shutdown (both normal and emergency) of each design specification unit or system.

II. GENERAL REQUIREMENTS Following general requirements apply to all three types of documents: A. Proprietary Information In addressing areas of proprietary nature, Contractor shall exercise strict information security in accordance with Project Instruction N° 7.E – Document Control. All necessary security measures shall be reviewed with EMPLOYER’s Project Manager prior to data compilation and/or preparation of documents, and the correspondent electronic files as well. B. Format All binding, lettering, page size, and other physical characteristics shall be in such form and detail as specified by the EMPLOYER’s Project Manager.




18. COMPILATION OF PROJECT DATA C. Distribution Distribution of documents shall comply with requirements of Exhibit 1-3 (Project Instruction N°1 – Correspondence). III. SPECIFIC REQUIREMENTS Specific requirements for each of the three types of documents shall be as directed by the EMLOYER’s Project Manager. However, the following are representative requirements: A. Project Record Books 1. Preparation and Release a. Preparation shall permit release of applicable Project Record Books to precede start-up of any unit or system by no less than three (3) months. Individual volumes shall be issued when completed. b. The EMPLOYER’s Project Manager shall authorize release of partially completed volumes if, in his assessment, the missing data does not detract from the volumes' usefulness. Subsequent distribution of originally missing data shall comply with all instructions of the EMPLOYER’s Project Manager. 2. Content Requirements a. Contractor is to compile all of the referenced Project Record Data in Exhibits 18-1 and 18-2 Project Record Books Content Requirements. B. Equipment Reference File 1. Preparation and Release Timing requirements for Equipment Reference File preparation and release shall be same as for the Project Record Book. 2. General Content Requirements Following requirements are common to all categories: a. Within each design specification volume, equipment items shall be arranged by the EMPLOYER's item number and include a brief description, requisition or purchase order number, vendor, model number and serial number.




18. COMPILATION OF PROJECT DATA b. Specific information contained for each item shall be divided into spare part (SP) and non-spare part (NSP) categories. c. Both Category I and Category III spares (See Project Instruction N° 5, Section III.F) shall be included in the SP items in III.B.2.b, above. Additionally, information contained in vendors' spare parts recommendations and Contractor's summary shall be duly incorporated to provide complete data regarding interchangeability, weights, prices, delivery times, etc. d. Contractor is collect and retain prerequisite information for use in compilation of Equipment Reference Files. 3. Specific Content Requirements a. An individual file is required for each piece of equipment. Contractor is to compile all of the Equipment Reference File data. C. Operating Instructions 1. Preparation and Release a. Preparation shall permit release of operating instructions including Company approval time for each design specification to precede Mechanical Completion of the applicable unit by no less than eight (8) months. b. As with the Project Record Book and Equipment Reference File, the EMPLOYER’s Project Manager may authorize release of partially completed volumes under certain conditions. 2. Content Requirements a. Operating instruction for each design specification shall address safe startup, operation, and shutdown under all conditions and specify the values to be maintained for all variables. Operating manuals for specific equipment items shall be included in the Equipment Reference File. b. Each volume or portion thereof for a design specification shall contain the following general sections: Introduction

unit or system duty and objectives;

Process Description

process discussion vis-a-vis objectives; design bases for strainer raw materials and product slates; material balance; equipment product




18. COMPILATION OF PROJECT DATA slates; material balance; equipment provided; etc; Control Description

process theory and operating conditional interrelationship between operating variables; unit or system controls; equipment details; flow diagrams etc.;

Pre- Commisioning

emergency provisions and equipment; procedures for flushing and testing systems; procedures for inspecting and commissioning equipment components, etc.;

Commisioning

general and specific procedures for unit or system operation with precautionary instructions;

Shutdown

general and specific procedures for the shutdown of the unit or system under normal and/or emergency conditions with precautionary instructions for all situations;

Safety

safety practices to be employed in all operating and maintenance procedures; safety and accident preventative equipment; safety flow diagrams, etc.;

Appendix

major equipment summary; instrument list, utility, catalyst, and chemical requirements; sample and control tests and procedures; etc.

IV. SUPPORTING INFORMATION REQUERIEMENTS The EMPLOYER’s General Management shall determine the specific requirements that must have into account the CONTRACTOR to design its Control System of the Support Information for each one of the: a. Project Register Books b. Equipment reference files c. Operative Instructions


X

X

X

SUMMARY OF PROCESS SPECS & DATA X X X X

X X X

DATA SHEETS

X X X X X X X X X X

PERFORMANCE DATA/CURVES X

X

X X X X X

X

X X X X

X

X X X X

OUTLINE DIMENSIONS


EQUIPMENT 1. MECHANICAL EQUIPMENT Atmospheric Tankage Blowers and Fans Compressors Heaters (including Boilers & Stacks) Heat Exchange Equipment (Cooling Towers Only) Machinery (Handling, Mixing, Packaging, Etc.) Mechanical Drivers Pressure Vessels Pumps Special Plants & Equipment (including Packaged & Environ. Protection)

DATA REQUIRED NOZZLE ORIENTATION X

X

PLAN & ELEVATION DRAWINGS X

X

CROSS SECTION WITH PARTS LIST X

X X X X

X X

INTERNAL LAYOUTS/SHOP DETAILS X

X

X

X

T

X X

LUBE/SEAL OIL/CONTROL DATA

EXHIBIT 18-1 EQUIPMENT DATA FOR PROJECT RECORD BOOK VOLUMES

X

X

VENDOR


X

X

MODEL NUMBER

Include fan and driver data.

SPECIAL REMARKS

VOLUME 2 PROJECT INSTRUCTIONS TO PART C SERVICES AND DELIVERABLES - FEED & EPC MASTER JOB SPECIFICATION PAGE 5 OF 8 EXHIBIT 18-1 PAGE 1 OF 2 DATE: JULY 10, 2009

T = for turbines only.

INSTRUMENTATION EQUIP/MATERIALS (as applicable) X

X

X

X X

OUTLINE DIMENSIONS


3.

X

Switchgear & Motor Controls

X

X X

X X

DATA REQUIRED DATA SHEETS

EQUIPMENT 2. ELECTRICAL EQUIPMENT Generators Motors

SUMMARY OF PROCESS SPECS & DATA

PERFORMANCE DATA/CURVES



CROSS SECTION WITH PARTS LIST X

X

X X

LUBE/SEAL OIL/CONTROL DATA X X

VENDOR X

X

X

X

MODEL NUMBER

INTERNAL LAYOUTS/SHOP DETAILS

NOZZLE ORIENTATION

Include current transformer rations, relay curves, etc. Include calculations and calibration curves.

Include driver data.

SPECIAL REMARKS


X X X X X

Electrical (Generation, Distribution)

Fuel Gas Fuel Oil & Naphtha Oil Movement & Storage Safety (Blowdown, Depressuring, Flare, Relief, etc.)

BALANCES FOR ALL DESIGN CONDITIONS X

X

PRESSURES X

X

X X

X

QUANTITIES


X X X

DESIGN BASICS OR SPECIFICATION

Air Compression (Plant, Instrument) Blending (Fuel Oil, Gasoline, Lube Oil, Naphtha, etc. Buildings and Civil Work

UNIT OR SYSTEM

DATA REQUIRED E

DEWPOINT X

X

FUEL CONSUMPTION X X

PROCESS FLOW SHEETS X X X X

X

P&IDS WITH LINE CLASS. SHEETS X X X X

X

PLOT PLAN X X X X

X

X


SUMMARY MATERIAL SPECIFICATION X

X X X X

X

X

X

EQUIPMENT DATA (per Ex. 18-1)


X Include safety valve protection calculations.

Include generation and distribution onelines.

SPECIAL REMARKS

EXHIBIT 18-2 CONTENT REQUIREMENTS FOR UTILITIES AND OFFSITE PROJECT RECORD VOLUMES


TANKAGE SCHEDULE

DESIGN BASICS OR SPECIFICATION X X X X

BALANCES FOR ALL DESIGN CONDITIONS X

X X X

QUANTITIES

PRESSURES


Note: All the information shall be filed in digital way.

Steam (All Generation, Distribution, Condensate) Terminals (Marine, Rail, Truck) Waste Treatment (All Types) Water Treatment (Supply, Treatment, Distribution

UNIT OR SYSTEM

DATA REQUIRED E


PROCESS FLOW SHEETS X X X X

P&IDS WITH LINE CLASS. SHEETS X

X

PLOT PLAN X X X X

PLAN & ELEVATION DRAWINGS X X

EQUIPMENT DATA (per Ex. 18-1) X X X X

TANKAGE SCHEDULE

SUMMARY MATERIAL SPECIFICATION

FUEL CONSUMPTION

DEWPOINT

SPECIAL REMARKS




19. COMPANY'S REVIEWS, AGREEMENTS, APPROVALS, AND AUTHORIZATIONS I.

OBJECTIVE This Instruction addresses the EMPLOYER's reviews, agreements, approvals, and authorizations related to Contractor's execution of Work.

II. REQUIREMENTS A. General It is the EMPLOYER’s intent to not interfere with the expeditious and orderly progression of Contractor's execution of Work so long as Contractor is meeting all requirements of the Contract. However, Contractor should clearly understand that drawings, vendors' prints, specifications and other documents which Contractor is required to submit to the EMPLOYER for review (degree of review at the EMPLOYER's discretion) or approval must be submitted on a timely basis in order to minimize the cost/schedule impact of any change should the EMPLOYER elect to make a change. B. Specific - Following categories of drawings require the EMPLOYER approval: • Block Flow and Process Flow diagrams; • Piping and instrumentation diagrams (P&ID's); • Mechanical flow diagrams - process, utility, and safety relief (flare); • Plot plans; • Underground plot plan • Equipment General Arrangement Diagrams/Mechanical Access; • Piping plan drawings (OSBL) • Electrical one-lines; • MCC layout of the Motor Center Control. • Cable tray routing plans; • Grounding plans; • Lighting plan; • Control Room details (Architectural, Foundation, Layout, Panel layouts); • Paving, grading, and roads; International Bidding Process N° PCI-002-2008-OFP/P ETROPERU



19. COMPANY'S REVIEWS, AGREEMENTS, APPROVALS, AND AUTHORIZATIONS • Instrumentation/electrical diagrams to existing in-service equipment • Isometrics involving tie-ins to in-service equipment and lines. • Vendor prints of critical equipment (to be established during review of document distribution matrix) • Specifications generated by contractor • Unpriced bid tabs The above list may be amended at the discretion of the EMPLOYER's Project Manager. In such cases, Contractor shall be given reasonable advance notice. C. Other The Agreement, General Provisions, and other parts of the Job Specification also contain specific requirements for the EMPLOYER's Reviews, Agreements, Approvals, and Authorizations.




20. PROTECTION OF PROPRIETARY/CONFIDENTIAL INFORMATION I.

OBJECTIVE This instruction presents the outline requirements and establishes minimum standards for security procedures related to proprietary/confidential information which Contractor shall use in formulating its Job Procedures for executing the Work.

II. GENERAL REQUIREMENTS Contractor shall conduct the performance of the Work in a manner which shall control the distribution of confidential information developed by or for the EMPLOYER, and prevent access to this information by any unauthorized parties, including the information generated. III. SPECIFIC REQUIREMENTS A. Confidential Information All data and information pertaining to proprietary equipment and instrumentation/computer systems, as well as certain other project items, data and information identified by the EMPLOYER from time to time, is to be treated as confidential information. This includes all information giving the process/operating data and characteristics, materials of construction, physical dimensions and configurations of specified or related equipment, Plant or equipment throughout, and cost or schedule information relating to the project. B. Secrecy Agreement Prior to the execution of any activity on the Work, Contractor and the EMPLOYER shall execute a Secrecy Agreement covering the treatment of confidential information. All Contractor employees or contracted personnel shall be familiar with the terms of this Secrecy Agreement, and shall be cleared by signing a document binding them to the terms of said Agreement prior to performing on any portion of the Work or being given access to any confidential information related to the Work. C. Project Location Contractor shall devote a restricted area of its office space for the development of the Work. This area shall have controlled access, and will be "off-limits" to any personnel not cleared. Contractor shall develop a method to ensure that only cleared personnel are granted unrestricted access to the ”off-limits”, and to record and control the access of all persons not cleared. Access by persons not cleared is to be kept to an absolute minimum. A conference area, inside the project location and immediately adjacent to an entry, shall be established to minimize movement by persons not cleared inside the project location. Essentially all project Work is to be performed in the project location. International Bidding Process N° PCI-002-2008-OFP/P ETROPERU



20. PROTECTION OF PROPRIETARY/CONFIDENTIAL INFORMATION D. Vendor Contacts No third party vendor, supplier or subcontractor shall be given access to confidential information unless such third party has executed a Secrecy Agreement relative to the information. All confidential information supplied to third parties as part of a request for bids shall be returned by unsuccessful bidders (including all copies made by Vendors). E. Data/Word Processing No confidential information shall be entered into any data or word processing systems unless adequate security routines and procedures, approved by the EMPLOYER, are present in such systems to prevent individuals not cleared from accessing the information. A log shall be kept of all confidential information retained in data or word processing systems or on recorded media. With the EMPLOYER authorization all such confidential information shall be purged from the systems/media at the conclusion of the Work. F. Reproduction All reproduction of confidential information shall be performed on equipment located in the project location, operated by cleared personnel. G. Mail and Courier Service Contractor shall arrange for all incoming mail and courier service which may contain or relate to confidential information to be labeled on the outside of the envelope for direct delivery to the project location. Specific responsibility shall be designated for the receipt, opening and logging of such in the project location before distribution to the appropriate project personnel. Any incoming mail and courier service, which, for whatever reason, should have been received under this arrangement and was not so received, shall be logged in with annotation of its unsecured arrival. All outgoing mail which contains or relates to confidential information shall be packaged/wrapped in the project location, shall be addressed to specific personnel authorized to receive such information and be sent under a secure mode of delivery. H. Model Any model effort to be required as part of the Work shall be performed inside the project location, including the fabrication of model equipment, if applicable.




20. PROTECTION OF PROPRIETARY/CONFIDENTIAL INFORMATION I.

Trash Disposal All documents to be discarded which contain confidential information shall be rendered unreadable within the project location before being dispersed as trash for disposal. Contractor shall develop, for the EMPLOYER’s prior approval, the method to be used in making the documents unreadable.

J. Logs All logs referred to in this instruction are to be kept as part of the project documentation, and shall be available for the EMPLOYER's review as requested.



VOLUME 2 ANEXO C1-FEED MASTER JOB SPECIFICATION PAGE 1 OF 1 DATE: 13 JULY 2009

ANNEX C1– FEED SERVICES AND DELIVERABLES Table of Contents 1. Introduction 2. Input Information/Data 3. FEED-EPC Contractor Scope of Work During FEED Phase 3.1

Phase Planning, Management and Control

3.2

Interaction and Relationship with PT, PMC and Licensors

3.3

Talara Refinery Modernization Complex Integration and Optimization

3.4

“Open Art” Unit BDP Preparation

3.5

Finalization of Licensor BDPs

3.6

BDPs to Complete FEED Packages

3.7

Preparation of OBE

3.8

Project Execution Planning

3.9

Long Lead Item Procurement

4. FEED-EPC Contractor Scope of Work During Pre-Construction 5. FEED Package Readiness for Potential Third Party Involvement

International Process N° PCI-002-2008-OFP/PETROPERU


VOLUME 2 ANNEX C1 – FEED – SERVICES & DELIVERABLES TO MASTER JOB SPECIFICATION PAGE 1 OF 22 DATE: 18 JULY 2009

ANNEX C1 – FEED SERVICES AND DELIVERABLES

1. Introduction Annex C1 – FEED – Services and Deliverables specifically addresses the requirements of the FEED-EPC Contractor during the FEED Phase of the Work. 2. Input Information/Data As previously stated, the FEED-EPC Contractor is expected to develop its response to the FEED-EPC IFP utilizing the background information and expectations contained in MJS Parts A, B, C and Annexes C1 and C2. The EMPLOYER shall deliver the information of the actual units that are available within a term of a month (1) after the date of the beginning of the Services. 3. FEED-EPC Contractor Scope of Work During FEED Phase Broad Perspective •

The Contractor shall, as part of the Services, review and fully satisfy itself as to the accuracy and adequacy of the Feed Technical Information (including the Heat and Balance Data and each Basic Design Package), and verify that such information is suitable for the purposes of satisfying the Employers requirements for the Project as set out in the Master Job Specifications.

•

Collectively includes all FEED obligations/functions necessary to incorporate EMPLOYER’s designated Licensor BDP and FEED Contractor’s internally designed “Open Art” BDPs into an integrated, optimized, cohesive, comprehensive, reliable, CAPEX and OPEX effective, high quality set of FEED phase deliverables including but not limited to complete FEED packages for all units, an AACEI Class 2, (as per the Association for the Advancement of Cost Engineering internacional-AACEI)+/-10% quality OBE, and a definitive EPC Phase PEP.

•

FEED Phase facility packages should be suitable for the FEED-EPC Contractor to prepare and present its LS Conversion Price Proposal or, in the event said price is unacceptable to EMPLOYER, to be conveniently and expeditiously used by EMPLOYER to secure alternative pricing from qualified third party industry EPC Contractors.



•


At EMPLOYER’s discretion, if EMPLOYER and the FEED-EPC Contractor cannot achieve Conversion immediately after completion of the FEED ,EMPLOYER may instruct the Contractor to proceed with the early stages of the EPC Phase in accordance with the mutually approved PEP which accompanied the FEED OBE after suitable agreed adjustments. During this Pre-Construction period, the FEED-EPC Contractor will work diligently to mitigate those issues which are preventing Conversion, continuously adjust its Conversion Price Proposal in accordance with project developments and attempt to achieve Conversion closure at the earliest possible opportunity. Employer will routinely be kept informed of cost commitments and expenditure levels and forecasts during the Pre-Construction period. The PMC obligations as stated in the Master Job Specification are only relevant between PETROPERU and the PMC and do not affect the obligations of the FEED-EPC Contractor.

Phase Obligations 3.1 Phase Planning, Management and Control Upon the signature of the FEED-EPC Agreement for the TRM Project, the selected Contractor is expected to implement its proposed/approved PEP by promptly putting in place the management, technical and administrative structure and resources to efficiently/ effectively carry out the FEED Phase of the Work. As stated in the Preamble to the MJS, the FEED-EPC Contractor is the primary participant in the overall program and is expected to plan and maintain its momentum while managing its direction and efficiency, not only through the FEED Phase, but throughout the FEED-EPC effort. The FEED-EPC Contractor is expected to carry out all technical studies necessary to develop an optimum, integrated CAPEX and OPEX efficient, overall facility plan, e.g., refinery-wide mass and energy balances, heat integration studies, effluent compliant analyses, energy conservation. Throughout the FEED Phase, the FEED-EPC Contractor is expected to maintain a well planned, coordinated and organized working environment, utilizing sufficient, competent, qualified staff to carry out the work, while maintaining effective communications and interaction with the PT, PMC and all Licensors. In this planning, it shall be considered that the Main Activities shall be developed exclusively by the FEED-EPC CONTRACTOR (no subcontractors). By Main Activities it is understood those activities developed by the CONTRACTOR, using the specialized knowledge, technologies, licenses, patents, good engineering practices and any other ability inherent to the CONTRACTOR, to ensure that the basic design, detail engineering,




equipment procurement, and the construction and assembly, is performed complying strictly the quality requirements established in the CONTRACT1. Some of the requirements including but not limited to, are listed below: (a) Design and Specification of the processing Equipment. (b) Specification Sheet Preparation of the processing Equipment. (c) Heat and Mass Balance Preparation (d) Flow Diagrams Preparation, Piping and Instrumentation, Equipment Distribution and other related. (e) Utility definition required for the Project. (f) Integration Activities of the Licensed and Open Art BDP’s, which includes the Licensor’s coordination. (g) Preparation of the Estimated Costs and Schedules t be defined in the OBE phase. 3.2 Interaction and Relationship with PT, PMC and Licensors The FEED-EPC Contractor shall initiate its work in a sequence that will most effectively interact with EMPLOYER’s selected Licensors so that all work is done in a timely, efficient manner, which minimizes recycle iterations and leads to an optimum overall, integrated plant configuration and design. 3.3 Talara Refinery Modernization Complex Integration and Optimization The FEED-EPC Contractor shall take the defined crude slate/assay mix and product specifications set forth in the Basis of Design and the indicated processing sequence and technologies, and develop a detailed material and energy balance for the complete refining complex by leading and interacting with the designated Licensors and its own “Open Art” facility design teams in order to achieve optimized, integrated, fully balanced mass and energy requirements for all component facilities. A preliminary sequence of the FEED-EPC Contractor’s Work and that of the Licensor’s is shown in MJS Part B – Basis of Design, Subsection 3.3. The FEED-EPC Contractor is expected to work closely with each of the Licensors, taking maximum advantage of integration and efficiency opportunities while respecting the operational and maintenance flexibilities of the facility.

1

Question 202, Round 3




3.4 “Open Art” Unit BDP Preparation It is expected that the FEED-EPC Contractor will develop the same information and deliverables associated with “Open Art” Basic Design Packages (OA-BDP) as noted for the Licensed Units as shown in this MJS Part B – Basis of Design, Subsection 3.4. It is expected that a separate OABDP package will be produced for each “Open Art” unit, while moving seamlessly through each BDP to produce the complete FEED Package. A chart describing the “Open Art” modified or new facilities for the Project is shown below for convenience:

Unit Primary Distillation Vacuum Distillation I Vacuum Distillation III Caustic Treatment Units Utilities and Offsites Gas Recovery Amine Plant for off gasses General Facilities & Services (including new dispatch jetty)

New or Expanded 2 Expanded Expanded New Expanded Expanded and New New New Expanded and New

3.5

Finalization of Licensor BDPs Not all Licensor BDPs will necessarily be as complete as called for in Part B – Basis of Design, Subsection 3.4. In such instances, if the Licensor does not or cannot produce the missing information, the FEED-EPC Contractor shall complete the work to the desired standard, based on mutual agreement between Employer and FEED-EPC Contractor and Licensor concurrence.

3.6

BDPs to Complete FEED Packages Each Licensor and FEED-EPC OA-BDP will be extended in accordance with the following specifications to produce a complete FEED package for each of the designated processing units, utilities and offsite facilities.

2

The detailed information of units to be expanded shall be provided to the Successful Bidder of the process. Answer to question 132 – Round 1.



Deliverable Feed Package - Assembly


Description FEED Packages are to be assembled by unit area. The Design Basis provides all the information agreed between parties involved in the project and upon which the FEED for the Plant will be based: • • • • • • • • •

Design Basis

• • • • • • • • • • • • •

Function and scope of the units Definition and description of all the process design cases Feed source and specifications Products destinations and specifications Plant capacity and turndown On-stream time Utility specifications Battery limit conditions General equipment and systems capacity design criteria Environmental requirements Safety requirements Codes and standards Site location, boundaries, benchmarks and coordinates Site location and existing facilities with laser mapping Local meteorological conditions Unit specific vent and drain philosophy Unit specific layout requirements Unit specific operations and maintenance requirements Unit specific commissioning and start-up requirements Unit specific single source vendor list Design Basis Philosophies (piping, electrical, process controls, etc.) Critical Design areas and Limitations Description

PROCESS DESIGN

Process Description

Process Flow Diagrams (PFD’s)

This will include a general description of the Process including the chemistry and salient features, and a more detailed description, from which each unit operation in the Process should be understood in conjunction with the Process Flow Diagram. Process flow diagrams (PFD’s) will show the functionality of the process systems of the unit, with the following information included: • Flow scheme with process streams and main utilities streams. • Source of incoming and destination of outgoing streams. • Tag number and service of equipment; indication of duplicates and installed spares. • Main control loops and instrumentation, necessary for proper functioning of the process at all normal




Deliverable •

• • • • •

Description operating conditions. Functional outlines of columns, vessels and reactors; numbering of trays and packing or catalyst sections; indication of main process internals and feed and product locations. Functional outlines of convection and radiant section coil arrangements for heaters. Functional type of heat exchangers such as air cooled, shell and tube or plate; allocation of shell and tube side. Functional type of pumps and compressors such as centrifugal or reciprocating; indication of capacity control when relevant. Stream number for all major process streams. Main utility streams; process conditions for utility streams are provided in the mass balances, on the PFD or on the UFD’s (see next chapter).

Mass and energy balances including supporting calculations will be provided at normal steady state operating conditions, showing chemical and physical characteristics of all primary streams and of secondary streams where appropriate. Data for alternative operating cases (e.g. start of catalyst life, end of life) will be provided where these affect significantly the operation of the plant. Utility Flow Diagrams

Utility Consumption List

Equipment List

Diagrams similar to the PFD’s covering major utility systems including Fire Fighting Systems. A listing of all utility users will be prepared for each system (e.g. steam, boiler feedwater, cooling water, hydrogen, nitrogen, fuel gas, etc.) giving details of normal and maximum operating requirements. Provide a listing of equipment by unit area with the following information: • Equipment Tag number • The number of operating and spare pieces • Service description • Main process characteristics (e.g. duty, capacity, dimensions, etc.) • Mechanical design conditions • Selected materials of construction • Remarks; this includes information like common spares with another equipment, part of a package unit, critical or proprietary service; equipment which is new, revamped, relocated, redundant or re-used in another service, recommended vendor for sole sourced equipment



Deliverable

Chemical and Catalyst Schedule

Plant Effluent Data Schedule

Piping and Instrumentation Diagrams (P&IDs)


Description This schedule will describe the specifications and physical and/or chemical properties, initial charges, expected consumption and recommended inventory. Suggested suppliers, where restricted purchase applies, will also be identified. Includes MSDS Sheets. A schedule of new and existing Plant effluents and emissions specifying: • Compositions • Physical state and conditions • Quantities General Approved For Design (AFD) Piping and Instrument Diagrams of the unit will be provided to allocate, identify and specify all piping, special piping items, instruments and process control elements in the unit, based upon the flow scheme and control scheme given on the Process Flow Diagrams, Utility Flow Diagrams and in the Process Control and operation philosophy. Piping Shown The following piping information is included: • All process lines required for all operating modes of the unit, including start-up, (normal and emergency) shutdown, regeneration, etc • All utility lines required for servicing the unit • Line size, line number and pipe class for all lines shown, including preliminary hydraulics calculations • Piping items like valves, spool pieces, spectacle blinds, (high point vents and low point drains for piping will not be included) • Heat tracing (steam or electrical) and jacketing where required for process reasons • Requirements for sampling, special arrangement of lines, sloping of lines, hot or cold flushing, purges, blanketing, etc. • Source of incoming and destination of outgoing lines • Sample points and references to typical installation (details of sample point installations will not be included) • Tie-ins Instrumentation Shown The following instrumentation information is provided: • All instruments required for all operating modes of the unit, including start-up, (normal and emergency) shutdown, regeneration, etc • Control loops and their main elements required for proper and safe operation of the unit • Air failure position of control valves • On/off valves (and air failure position) • Set pressure of safety valves/rupture discs • Size of control valves and safety valves, including




Deliverable • • •

Minimum Equipment Elevation Summary Schedule

Line Designation Tables (LDT)

Process Critical Line List

Piping Specialties Items List

Piping Specialties Process Data Sheets

Piping Services Specifications

Description relief valve inlet and outlet pipe sizes Tag numbers of instruments, instrument loops, safety valves and on/off valves Flow meter type and preliminary size In-line analyzer types and hook-ups for connection (supply and/or return) to the process

Equipment Information The following equipment information is provided for each piece of equipment: • Tag number and service • Outline depiction • Indication and numbering of process internals • Position and elevation requirements (to grade and/or other references) • Type of heat exchanger or heater • Type of rotating equipment nozzles • Nozzle sizings • Heat Tracing type • Insulation type • Mechanical seal type A schedule of minimum elevation requirements for items of equipment. The LDT will include the following information: • Line Numbers • Line sizes • Piping specifications • Flowing medium codes (service code) • “To and from” data • Operating pressures and temperatures • Mechanical design pressure and temperature • Insulation requirements This document will include a list of critical lines whose detailed piping design must be reviewed by the Licensors. A listing of all piping specialty items identified on the P&ID’s. Piping specialty items are in line piping items that are not covered by general piping specifications. (Special valves, desuperheaters, spectacle blinds, etc.) Process Data sheets for Piping Specialty Items including: • Item Number • Function • Design Type • Operating and Design Conditions (Flows, Temperature, Pressures, etc.) Piping Services specifications are based on fluid properties and operating and mechanical design pressures and temperatures. The specification includes information pipe sizing, materials of construction, wall thickening 3 considerations and valving requirements .

3

More details about the material specification and drawings shall be provided to the successful bidder. Question 32 – Round 1.



Deliverable

Tie-In Summary

Relief Valve Summary Materials Selection Report

Hazards Study Report

Laboratory Equipment Specifications

Analytical Manual

Process Operating Manuals and Performance Test Procedures


Description A listing of all battery limit tie-ins as noted on the P&ID’s including the following information: • Tie-in Number • Service Tie-ins • Location • “Hot” or “Cold” tap • Basic Design (“Double Block and Bleed”) • Description of special requirements and conditions A tabulation of pressure relief valves discharging to the atmosphere or flare, listing design conditions for each case. The report will provide the basis for material selection and special requirements for materials of construction. This report will contain the following information: • Results of PHA/HAZOPs Reviews • Listing and discussion of potential process hazards, their effects, prevention and implications for plant design and operation • Incorporate HAZOP recommendations where possible and provide list of outstanding recommendations to be incorporated in detailed design • A listing of flammable and/or toxic substances • A listing of substances likely to be found in the Plant with a commentary on their uses, locations within the process, their individual and, where appropriate, collective hazards • Material safety data sheets In addition to the Laboratory Basic Design consider only the Specification deliver for laboratory analytical equipment which is needed to control and monitoring the new process 4 units . A manual detailing analytical methods, sampling points, analytical equipment and reagents used to control the Process Units during normal operation and to determine performance during guarantee test runs. These are “high level” descriptions of activities that will be used as a basis to develop step-by-step instructions in starting up the Process Units. Information included is: • Process DescriptionG • Start-up and Planned Shutdown ProceduresG • Normal and Emergency Operating ProceduresG • Emergency Shutdown ProceduresG • Performance Test Procedure, defining in detail how the guaranteed

MECHANICAL DESIGN Long Lead Items Equipment List (LLE) Engineering Equipment Data Sheets (General)

4

Equipment whose delivery might force the schedule extension if not ordered prior to Conversion • Equipment engineering data sheets will be prepared for all process equipment

Answer to question 100 – Round 1.



Deliverable

Columns, Reactors, Vessels and Drums

Heat Exchangers (Shell and Tube Type)

Heat Exchangers (Proprietary Type, e.g., Air Coolers, Plate Exchangers)

Rotating Equipment (Compressors, Pumps, Fans and Blowers)


Description • These data sheets will contain the information listed on the BDP Process Data Sheets, adding mechanical information which further defines the design of the equipment • These data sheets will contain sufficient information so that they can be issued to equipment vendors as part of Inquiry Requisitions Additional information for specific types of equipment are as follows: • Sketch showing general arrangement with main dimensions, tray location/packing height, nozzle locations, support requirements • Operating Fluid • Operating and Design Pressures and Temperatures • Design Code and Notes • Process Nozzle Sizes and Preliminary Instrumentation Nozzle Sizes • Materials of Construction • Corrosion Allowance • Insulation Requirements • Details of Internals (where applicable) • Tray Process Specifications (duty and materials, where applicable) • Type of Heat Exchanger • Number of Shells • Duty • Operating and Design Pressures and Temperatures • Allowable Pressure Drop • Materials of Construction • Corrosion Allowances • Design Codes and Notes • Nozzle Sizes • Surface Area, number, size and arrangement of tubes • Insulation Requirements • Duty • Operating and Design Pressures and Temperatures • Allowable Pressure Drop • Design Code and Notes • Materials of Construction • Corrosion Allowance • Nozzle Sizes • Insulation Requirements • Plot Limitations (if applicable) • Driver Data (if applicable) • Type of Unit • Number Required • Duty Specification • Fluid Characteristics and composition • Particular process requirements




Deliverable • • • • • • • • • • • • • • • • • •

Fired Heaters

• • • • • • •

Boilers

• • • • • • • • • • • • • •

Description Operating Conditions: pressure, temperature, flow rates and differential pressures Materials of Construction Corrosion Allowances Recommended type and specification of driver Efficiency (at operating point) Special seal requirements Type and Specification of Driver (where appropriate) Design Codes and Notes Operating Location Lube/Seal Oil System (where applicable) Instrumentation Requirements (where applicable – minimum for safe operation) Utilities Requirements Type of heater Materials of Construction Process conditions for the governing design case(s), including vaporization data, where needed Process conditions for the auxiliary streams Absorbed heat duty for the process stream and auxiliary streams Design requirements (e.g. number of passes, tube diameter, heat flux and/or velocity limitations, allowable pressure drop, minimum efficiency, excess air, NOx) Mechanical design conditions (per section when relevant) Materials of construction (per section when relevant) Type and specifications of fuel(s) for fired heater, power data for electrical heater Thermal design of fired heater General arrangement drawing of fired heater showing coil(s) layout Noise limitations Design requirements for combustion air preheat and flue gas systems Type of boiler Process conditions for the governing case(s) Heat duty Fuel requirements Design requirements (Temperature, Pressure) Water quality specifications Steam specifications Blowdown and effluent specifications Condensate specifications General arrangement drawing (including access platforms) Noise limitations Combustion management system description Materials of Construction Design Codes




Deliverable • • • • •

Packages and Miscellaneous Equipment Items

• • • • • • • • •

Description Mechanical Design conditions Equipment Description Number Required Sketch showing Principal Dimensions (where appropriate) Supports and arrangement of the items (where appropriate) Operating and Design Conditions Fluid Characteristics Design Codes and Notes Nozzle Sizes Materials of Construction Corrosion Allowances Drive Data (if applicable) Utilities Requirements Instrumentation Requirements (where applicable minimum for safe operation)

PIPING DESIGN/PLANT LAYOUT

Overall Refinery Plot Plan

Process Units General Arrangement Drawings

Utilities and Offsites General Arrangement Drawings 3D Plant Model

Critical Piping Layout Studies

5

The Overall Refinery Plot Plan will be updated to reflect the installation of the expanded/modified facilities. Include a key plan for the General Arrangement Drawings. The general arrangement plan of the existing refinery has been provided in Appendix 5.1 of Part B “Bases of Design” 5 of the “Master Job Specification” . General Arrangement Drawings will be prepared for each of the new/modified process units. These drawings will show at a minimum: • Location of Equipment • Location of main structural steel members • Location of aisleways, ladders and platforms • Location of main piperacks, cable trays, etc. • Location of safety and fire fighting equipment • Incorporation of Licensors’ standards and requirements General Arrangement Drawings will be prepared for the Utilities and Offsites Areas. A 3D Plant Model will be developed for this project. The Contractor is to indicate what software will be used for Model development. These studies will include the following information at a minimum: • Identification of critical pipelines • Isometric sketches for: - Critical pipelines - High cost mechanical piping (to support development of OBE) - Preliminary stress analysis for certain pipelines (high temperature, long run, large diameter, etc.)

Related to question 31 – Round 1



Deliverable Underground Piping Layout Studies

PROCESS CONTROLS/ INSTRUMENTATION DESIGN

Process Control and Operation Philosophy Report


Description A study of cable trenches, firewater lines, major U/G piping, (e.g., process piping, sewers, etc.) which indicate material of construction, sizing, routing, potential conflicts, etc. This work to be performed in close coordination with the TRM Project MAC Contractor During the first FEED phase (maximum 2 months after the Contract signature), the FEED-EPC Contractor will develop a MAC Selection Process which results will be finally approved by the EMPLOYER. The main operational control functions are described in the Process Control and Operation Philosophy Report. Operational control involves all manual, continuous and automated actions to properly operate the process and keep the process within its operating window, thus making products meeting their specifications. Special process considerations such as startup, shutdown, fuel gas composition, etc. will be included. This report also addresses emergency situations – how to avoid and how to regain control of operations. The document will be developed in parallel with the Process Flow Diagrams (PFD’s). It describes the primary objectives of the process and how these can be achieved during normal operating modes. Furthermore, it provides an operational control description for each process unit, the possible expansion with advanced process control and an indication of sequence and batch controls. As far as applicable, it also includes operational control design considerations. The Process Control and Operation Philosophy sets the basis for the Process Control Functional Specifications.

Process Controls Functional Specifications

Define platform of advanced control and optimization management of assets. The operational control functions are specified in detail in the Process Control Functional Specification. Operational control consists of regulatory control, sequence and batch control, manual manipulation and may include advanced process control. The document will be developed in parallel with the Piping and Instrument Diagrams (P&ID’s). The design basis of the PCFS is given in the Process Control and Operation Philosophy. The specifications will contain a functional description of the complex regulatory control loops and (semi) automated sequence/batch controls. The specific operational and implementation aspects of all regulatory controls (e.g. equations, tracking, transmitter failure handling) will be included. If applicable, Sequential Function Charts or structured text (as per IEC-1131-3 standard) are provided for sequence/batch controls. During FEED default values are used. DCS functional specifications are also included (including preliminary loop/logic diagrams).



Deliverable

Preliminary Process Trip Schedule and Logic Diagram

Emergency Shutdown (ESD) Functional Guidelines

Instrument Index

Instrument Specification Sheets


Description The process trip schedule is a matrix diagram showing actuations required for the safe start-up operation, and shutdown (Trip) of the Plant. The logic diagram is a preliminary representation of the initiator and trip actions listed on the process trip schedule. This document provides the minimum functional requirements of the ESD system to provide the Plant with a safe and reliable protection system during normal and upset process conditions. It provides technical guidance as to: • The recommended system design and technology to be used • A description of the methodology of the operator interface • An explanation of the Process Trip Schedule and Process Logic Diagrams and their use in the programming of the ESD system The Instrument Index lists instruments and/or functions that are required for control and safeguarding of a process plant. It is the basic document derived with the P&ID’s from which the instrumentation work is executed. The Instrument Index shall be part of a Smart Instrumentation Database, fully integrated with the P&ID’s and instrument specifications. The following fields of the instrument index will be completed: • Tag number • Service description • Instrument Type • P&ID number • Location (local, local panel, etc.) • System (DCS, ESD, etc.) • I/O type (input/output, digital, analogue) • Line size • Pipe class • In-line instrument size Listing of instruments in the instrument index will be limited to those instruments as indicated on the P&ID’s. The instruments specification sheets will contain relevant process and instrument specifications valid for the function and type of instrument. Specific information for certain instrument classifications are as follows: Control Valves Specification Sheets • Process conditions for the governing design case(s) • Spring action • Mechanical minimum stop (if applicable) • Mechanical design conditions • Preliminary sizing • Noise limitations



Deliverable

I/O Count Report


Description Safety Valves/Relief Devices Specification Sheets • Protected equipment/systems • Relief cases identification • Process conditions for the relief cases • Type of safety valve/relief device • Mechanical design conditions • Preliminary sizing Analyzers Specifications Sheets • Function of analyzer • Property to be analyzed • Composition of fluid to be analyzed • Type of analyzer • Process conditions for the governing design case • Range of value of the property to be analyzed • Number of I/O • Communication with DCS • Mechanical design conditions • Utility requirements • Housing requirements Flow Instruments Specification Sheets • Capacity • Process conditions for the governing design case • Type and function of the instrument • Mechanical design conditions • Preliminary size Flow Metering Skid Specification Sheets • Capacity • Process conditions for the governing design case • Type and function • Mechanical design conditions Alarms and Automatic Shutdown Devices • Alarm Cabinet/Panel Description • Type of Alarm • Trip points • Connection to Control System • Configuration Special or Unusual Instruments • As directed by the specific instrument An I/O Count Report will be prepared indicating the inputs and outputs defined per system with reference to base documents used and assumptions/spares/space taken into account. If applicable I/O count shall also contain the count for signals connected to other systems like PLC, machine monitoring. Serial interface signals may be incorporated.

ELECTRICAL DESIGN The Power Consumers List will provide an overview of power consumer data of the plant, including the aggregates of utilities such as lighting and heat tracing. Power Consumers List

The list will show name plate ratings, connected and operating loads and related electrical performance data under normal plant operating conditions.



Deliverable

Electrical Load Balance Study

Electrical Equipment Data Sheets

Single Line Electrical Drawing (Preliminary)

Unit Hazardous Area Classification

Electrical Cable List (Preliminary)

CIVIL, STRUCTURAL AND ARCHITECTURAL

Preliminary Civil Design

6 7


Description The Power Consumers List also indicates the emergency power requirements on the basis of which an emergency power network will be developed. Includes the electrical equipment load allocations to the switchgear/MCC’s. Electrical equipment sizing data will be used on the Electrical Equipment Data Sheets. Data sheets will be prepared for the following electrical equipment within the unit. • Electric motors, individual motors, individual sheets for large drive systems, if required including frequency converter data sheets • HV cable • Other Switchgear, MCC’s • UPS Systems • Variable Drive Systems This diagram indicates the electrical distribution system of generators, switchgear, MCC and transformers, identifying process loads for normal and emergency/essential power. The single line diagram will be based on the "Electrical Load Balance Study” The Unit Hazardous Area Classification Memorandum will provide an overview per equipment item per unit of the contents chemical properties, volume, operating pressure, operating temperature. This document serves as back-up document for the hazardous area classification lay-out. The Unit Hazardous Area Classification Lay-out drawings are based on each unit’s general arrangement and shows sources and extent of gas and/or dust explosion hazards, including a legend and explanatory notes. Text shall include a summary of rules and codes followed electrical area classification within each unit, a material selection table, a listing of prevailing products and possible restrictions in application or validity. These documents are used as basis for the selection of equipment and materials An Electrical Cable List for the respective unit will be prepared indicating preliminary sizes of HV and LV cables. The list shall be based on the cable sizing specifications. Cable sizing calculations shall include the application international derating factors. The cable list will serve as the basis for the cable trench sizing and routing. The Contractor must acquire regulations, standards and other bibliographic material necessary to comply with its 6 obligations . The following documents will be prepared: • Soils Investigation Reports (prepared by local Geotechnical Engineering Company). Latest report 7 to be included at minimum . • Preliminary Site Development Plan (including paving and grading sketches)

Questions 61 and 62 – Round 1. Question 37.1 - Round 1 (The Contractor shall include the most recent soil study).



Deliverable

Preliminary Structural Design

Preliminary Architectural Design

Demolition/Dismantlement Relocation Plan

Material and Installation Design Standards Specifications (Issued For Design

Equipment Insulation List

Constructability Report


Description 8 • Preliminary Foundation Sketches (including railways, trenches, etc.)Piling Study • Soils disposal plan The Contractor must include the most recent soil study. The following documents will be prepared: • Preliminary Structural Sketches for: - Process Structures - Piperacks - Loading Dock - Other Structures Preliminary floor plans of the: • Administration Building • Laboratory Building • Control and Operations Center This plan will cover: • Identification of areas to be demolished or dismantled as shown on a “marked up” existing drawing • A listing and description of equipment to be relocated The development and issuance of material and installation design standards and specifications, including, but not limited to: • Piping • Layout and spacing • Mechanical • Process Controls (DCS, Instrumentation, etc.) • Electrical • Civil • Structural • Architectural • Insulation • Painting • Fireproofing • Other Coatings (e.g. acid coatings for concrete, etc.) Reference to specific codes and industry standards should be identified in these specifications. A listing of applicable codes, procedures, standards and specifications shall be included. A list of equipment to be insulated with the following information: • Item Number • Item Description • Insulation Specification • Insulation Thickness A report that covers the construction aspects of the project, including the following information: • Highlights of Constructability review of design

8

Question 37.2 - Round 1 (More information about the piles shall be submitted to the Successful Bidder).



Deliverable

VIP Report

Project Execution Plan


Description documents • Equipment Plot Plan Placement vs. Installation and Removal • Construction Clearance Required – Horizontal and Vertical • Safety Permits and Procedures Required • Underground Conditions Evaluated • Tie-Ins/Hot Taps • Revamp Requirements • Work Sequence • Modularization • Labor Survey (Availability, Skills, Work Rules, Work Week, Union, Open Shop, Third Party Nationals, Etc.) • Heavy Lift/Rigging Plans • Laydown Area, Marshalling Yards, On-Site/Near Site Storage, Etc. • Temporary Facilities Requirements, Placement • Temporary Utilities • Turnover Requirements (Sequence, System Boundaries, Punchlist, Turnover Package Requirements, Hold Points, Witness Points, Walkdowns, Etc.) A report concerning Value Improving Practices (VIP) activities that took place during FEED. Information included is: • VIP Schedule • Procedures used • Ideas considered • Ideas implemented • Benefits to be achieved Development of PEP as described in Section One of the IFP

It is clarified that: •

P&ID´s - equipment information: the nozzle dimensioning for rotary equipment is excluded from the FEED phase scope.

•

Laboratory equipment specifications: this is included in the FEED scope.

•

Process Operating Manuals: They are excluded from the FEED scope and have to be completed as part of Ready for Start Up.

•

Heaters: specifications sheets (according to the API 560 or ISO 13705 standards) 9 necessary for the purchase orders issuance are within the FEED scope .

Boilers: platforms distribution is excluded from the FEED scope

9

Respuesta a la Pregunta 120 – Ronda 3.



3.7


Preparation of FEED-OBE The FEED-OBE shall comply with AACEI Class 2 requirements and be a +/10% accuracy. All required supporting data should be developed to the level of engineering completeness specified therein. The OBE preparation process to be adhered to by the FEED-EPC Contractor shall be based necessarily on following provisions10: Estimate Basis Memorandum (EBM) •

An EBM is to be prepared prior to development of the OBE. The EBM is the plan by which the FEED-EPC Contractor will develop the OBE. EBM shall be presented to Employer for approval prior to start of work on OBE, which is expected to occur during the mid- to-latter stages of FEED development, at which time sufficient engineering has been developed (approximately 30% of the Detail Engineering)to permit OBE assembly.

•

The EBM should establish the overall philosophy for the OBE and scope inclusions and exclusions, set estimating factors, methods and principles which can be pre-established in order to minimize the level of review required once the completed OBE is available.

The Pre- Construction phase finishes when the Conversion is achieved.

•

The EBM is intended to pre-identify the methods, techniques and cost data sources to be used in the preparation of the OBE, including such things as estimating factors, labor surveys/rates/productivity/availability, bulk material and equipment allowances, etc. It should also define the level of technical definition and sourcing of important cost estimating information (e.g., extent and source of

•

bulk material take-offs, equipment specifications, what is to be firm quoted, what is to be budget quoted, estimated in-house). Establish agreement on what estimating systems are to be used and identify which default factors will be acceptable, acceptable reference databases, levels of accuracy, etc.

•

The EBM shall confirm the WBS and Code of Accounts to be applied and the estimating structure/format to be followed.

•

The EBM shall define how the OBE contingency is to be developed and escalation is to be treated.

10

General Clarification about the Schedule of Round 3 The Scope Definition phase finishes when it is accepted the Scope Definition Proposal submitted by the CONTRACTOR with the Open Book Estimate (OBE). The Pre-Construction phase is completed when the Conversion is achieved.



•


The EBM shall confirm that the OBE will be consistent with plans and schedules reflected in the EPC PEP.

Open Book Estimate (OBE) The OBE will be outlined in the EBM and shall include but not be limited to the following: •

Scope of Work including clear delineation of inclusions and exclusions

•

Type of Estimate – confirm consistency with AACEI Class 2 (+/-10% Accuracy) and any departures there from

•

Methods/Systems/Techniques used in preparation of the OBE

•

Identification and reference to Source Data and Documentation utilized in OBE preparation

•

WBS and Code of Accounts structure and level of detail included

•

Material Take-Off Techniques utilized (count vs. factored)

•

Definition of Allowances utilized

•

Complete listing of assumptions, premises, exclusions, inclusions, qualifications statements and justification

•

Confirmation of alignment with Project Schedule requirements (including premium costs, overtime costs, etc. necessary to achieve Project Schedule requirements)

•

Direct and Indirect cost summaries and supporting detail

•

Subcontracts

•

Equipment by Class (Towers, Furnaces, Pumps, Heat Exchangers, etc.)., defining Material Costs, Installation Labor Manhours and Costs, Subcontract Costs (showing split between labor and material costs)

•

Materials by Class (Concrete, Structural Steel, Piping, Architectural, etc.) defining Material Costs, Installation Labor Manhours and Costs, Subcontract Costs (showing split between labor and material costs)

•

Engineering (Home Office Costs)

•

Construction Management Staff Costs




•

Field Indirects (Temporary Consumables, etc.)

•

Other Costs such as Catalysts and Chemicals

•

Spare Parts Costs

•

Escalation Assumptions (Provisions)

•

Contingency

Facilities,

Construction

Equipment,

Employer shall require FEED-EPC Contractor to present a complete OBE package, which shall have, the EBM, OBE and a Basis of Estimate document included. Insofar as the EBM is a planning document, the Basis of Estimate is the supporting document that describes how the OBE was actually developed, reflecting deviations and their rationale, from the EBM. The OBE will serve as the basis for negotiation of the Conversion from a RC structure to a LS EPC structure. At progressive development intervals of the OBE during the FEED stage, Employer and Contractor shall engage in a series of Risk Analysis exercises to identify Risks and exposures that would affect the Project costs and levels of Cost Contingency. Contractor shall therefore develop “neat” Cost Estimates (including appropriate allowances, but ex-Contingency) for these Risk Analysis exercise(s). The Cost Estimate Risk Analysis results shall be initially utilized to determine an appropriate level of Contingency for the Project, which shall then be included in the OBE. Several iterations of OBE updates and risk analysis exercises may be required to achieve Conversion. Such updates to the OBE (and Risk Analysis) shall be conducted at least monthly until achievement of an approved OBE and Conversion is effected. 3.8

Project Execution Planning FEED-EPC Contractor is requested to expand upon Part A – Project Perspective included in this MJS, incorporating their respective plans for carrying out the Work and presenting their plan and schedule for the FEED Phase of the TRM Project in a Preliminary-PEP (P-PEP) that will be delivered at the Contract Subscription. EMPLOYER requests that this plan and schedule for FEED Phase of the TRM Project be completed to Level 2 detail and coverage. This plan and schedule, with any mutually agreed adjustments and approval, will serve as the Master FEED Phase plan and schedule to launch the FEED effort. Contractor will be expected to regularly status, update and expand the level of detail for this Master Plan and Schedule, adequate to effectively plan, manage and status the work.



3.9


Long Lead Item Procurement The FEED-EPC Contractor shall provide an equipment component lists that, in its experience shall be considered as from long load procurement. During the course of the FEED effort, the FEED-EPC Contractor will update the list of long lead items in conjunction with the Licensors to provide EMPLOYER with its best insights as to what equipment and/or materials might be considered for early procurement in order to shorten the overall duration of the TRM Project. Subject to EMPLOYER’s review and agreement, said long lead items will be procured before Conversion (during the Scope Definition or during the PreConstruction phase) in order to capitalize on schedule reduction opportunities. Additionally, firm quotations for such long lead items will be needed in order to comply with the quality requirements of the OBE.

4. FEED-EPC Contractor Scope of Work During Pre-Construction As previously indicated, it is expected that Conversion will occur at or shortly after the completion of the FEED Phase of the work. Should this not occur, and subject to EMPLOYER’s approval, the FEED-EPC Contractor is authorized to begin some or all detailed engineering and procurement work indicated on its EPC PEP, on a reimbursable basis, until Conversion is achieved. The FEED-EPC Contractor shall work continuously to improve its proposal for Conversion in an endeavor to affect Conversion as early as possible after completion of the Scope Definition Phase of the TRM Project. 5. FEED Package Readiness for Potential Third Party Involvement Should EMPLOYER decide that it would be beneficial to its general interest to proceed with the EPC work with other parties, the FEED Phase work products must be well organized enough to allow such third party Contractors to efficiently prepare EPC LS proposals and proceed with EPC work at EMPLOYER’s authorization.



VOLUME 2 ANNEX C2 – EPC - SERVICES & DELIVERABLES TO MASTER JOB SPECIFICATION PAGE 1 OF 1 DATE: 10 DE JULIO DE 2009

ANNEX C2 – EPC SERVICES AND DELIVERABLES

Table of Contents 1.

Introduction

2.

FEED-EPC Contractor Scope of Work During EPC Phase 2.1

Transitioning from Pre-Construction

2.2

Planning, Management and Control Phase

2.3

Interaction and Relationship with PT, PMC and Licensors

2.4

Detailed Engineering, Procurement, Construction, Commissioning/Start-up/ Performance Testing

2.5

Performance Testing

2.6

Final Acceptance



VOLUME 2 PROJECT INSTRUCTIONS-PART C SERVICES & DELIVERABLES -FEED-EPC MASTER JOB SPECIFICATION PAGE 1 OF 8 DATE: 10 JULY 2009

ANNEX C2 – EPC SERVICES AND DELIVERABLES

1.

Introduction Annex C2 – EPC – Services and Deliverables, broadly addresses the requirements of the FEED-EPC Contractor during the EPC (Construction) Phase of the work. The Agreement and MJS taken collectively more definitively define the extensive requirements of the EPC Phase. It should be noted that transitioning from the FEED Phase to the EPC Phase will shift Contractor compensation from a Reimbursable to a LS platform. Given that the details for the EPC Phase are contained throughout the Agreement and MJS, the following will simply provide an overview of the EPC Phase requirements.

2.

FEED-EPC Contractor Scope of Work During EPC Phase 2.1

Transitioning from Pre-Construction The FEED-EPC CONTRACTOR for the TRM Project is expected to be fully experienced and qualified to carry out all EPC roles and responsibilities. After completion of the Scope Definition Stage of the project and successful Conversion, it is expected that the FEED-EPC Contractor will proceed to implement the EPC Phase of the work with due diligence and in accordance with the mutually approved EPC Phase PEP. In essence, the FEED-EPC Contractor’s responsibilities during the EPC efforts will include, but not be limited to detailed engineering, procurement (purchasing, expediting, inspection, traffic) of equipment and material, subcontracting, construction, commissioning, startup and performance testing through successful performance of all project facilities and for overall management, coordination and control of its scope of the work in a safe, orderly, responsive manner. The FEED-EPC Contractor will be solely responsible for the execution of project work during the EPC Phase, subject to only preestablished approvals by EMPLOYER and the requirements of the Agreement and these MJS. During the EPC Phase, the FEED-EPC Contractor will continue to collaborate with the TRM Project Licensors in order to ensure their satisfaction and support.

2.2

Planning, Management and Control Phase During the EPC Phase, the FEED-EPC Contractor will continue to have responsibility to meet TRM Project completion requirements, efficiently plan and coordinate the work, monitor and control progress and maintain project momentum. Contractor will also assist EMPLOYER and PMC in managing changes without disruption to the work.



2.3


Interaction and Relationship with PT, PMC and Licensors Throughout the EPC Phase, the EPC Contractor is expected to maintain timely, open and objective communications and interaction with the PT, PMC and Licensors as well as all other project participants, respecting their contributions to the project. EMPLOYER expects the TRM Project to be an outstanding example of cooperation and positive relationships with all involved parties.

2.4

Detailed Engineering, Procurement, Construction, Commissioning/ Start-up/ Performance Testing The FEED-EPC Contractor’s roles and responsibilities during these important stages of the EPC Phase as set out in the Agreement and this MJS are expected to be recognized and practiced by the FEED-EPC Contractor. EMPLOYER expects that the FEED-EPC Contractor will respect and exercise industry best practices throughout its work. As a world class, proven Contractor, the FEED-EPC Contractor is expected to be fully aware of industry best practices and incorporate these measures in order to make the TRM Project a first quintile industry performance example. Some FEED-EPC Contractor EPC Phase technical obligations are defined in Project Instruction Nº 18, while other technical deliverable obligations include but are not limited to those listed in the following table. Administrative, Project Management, Project Control, etc. deliverable requirements are referenced in other sections of the IFP.



Category/Discipline General

Item

Deliverable Title/Description

1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15.

Project General Engineering Specifications Project Coordination Procedures Listing of Applicable Codes, Standards, etc. Engineering Calculations Books Utility Summaries Expendables Summary Materials Safety Data Sheets Site Plans 3-D Model FEED Packages FEED Open Book Estimate (OBE) Design Registration & Regulatory Submittals Environmental Submittals Material Take-offs Underground Drawings – Plans, Section, Details Design Reviews/Logs - PHA/HAZOP Reviews/Reports incorporate recommendations considered and adopted in detailed design - Design Reports - Risk Assessments & Mitigation Reports Construction Studies Construction Infrastructure Packaged Equipment – Definition, Scope, Coordination Lessons Learned Report Complete Set of Purchase Order & Subcontract Files Process Design Criteria Process Simulations & Modeling Process Standards & Speculations Licensor Basic Design Packages Process Flow Diagrams Process Descriptions Material & Energy Balances Process Information for Area Classification Process Physical/Chemical Data Process Equipment Sizes/Sketches Process Equipment Specification/Load Sheets Safety Valve Sizing Basic Data Sheets Piping & Instrument Diagrams (P&ID) Process/ Utility/Auxiliary Utility Balance Diagrams Line Sizing/Wall Thickness & Hydrotest Data Hydraulics Calculations (Equipment & Piping) Pump & Reboiler NPSH Calculations Line Designation Tables Tie-In Distribution & Related Details Process Logic Narratives Battery Limit Conditions Chemical Requirements Summaries & MSDS Product Safety Data Sheets Process Data Sheets Instrumentation Process Data Sheets Specialty Items

16. 17.

18. 19. 20. 21. 22. 23. 24. Process


1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25.


Notes


Category/Discipline

Mechanical

Furnaces

Vessels

Exchangers

Rotating, Special & Utility Equipment

Item


26. 27. 1. 2. 3. 4. 5.

Pressure Safety Valves (PSV) PSV Discharge & Flare Calculations Mechanical Design Criteria List of Mechanical Standards and Specs Equipment List Mechanical Equipment Data Sheets Equipment Specifications for Packaged Equipment Material Selection Diagram Design Calculation/Studies Mechanical General Arrangements Manufacturing Data - Equipment General Arrangements/Sections - As Builts from OEM - Maintenance and/or Repair Manuals - Operating Manuals Furnace Design/Purchase Specifications Furnace Data Sheets Furnace Design Calculations Furnace General Arrangements/Detailed Dwg. Furnace Inquiry/Purchase Requisitions Vendor Drawings Test Procedures/Reports & Performance Requirements Parts List/Recommended Spares Operating & Maintenance Catalogs/Manuals Vessel Design/Purchasing Specs Vessel Outline & Detailed Drawings Vessel Design Calculations Vessel Nozzle Sizes/Orientations Vessel Purchase Order / material Requisitions Vessel Fabrication Drawings & Design Calcs Vessel Platform & Ladder Drawings Vessel Pipe Support & Guide Drawings Exchanger Design/Purchasing Specs Exchanger Rating Calculations Exchanger Setting Plans/Tube Sheet Layouts Exchanger Purchase Order / Material Requisitions Vendor Fabrication Dwgs & Design Calcs Equipment Design/Purchasing Specifications

6. 7. 8. 9. 10. 11. 12. 13. 1. 2. 3. 4. 5. 6. 7. 8. 9. 1. 2. 3. 4. 5. 6. 7. 8. 1. 2. 3. 4. 5. 1. 2. 3.

7. 8. 1.

Equipment Detail Specs/Data Sheets Equipment Purchase Order / Material Requisitions Space & Utility Summary Vendor Arrangement/Detail Drawings Test Procedures/Test Reports/Performance Curves Vendor Parts List/Recommended Spares Vendor Operating & Maintenance Catalogs Instrument & Control Systems Design Criteria

2. 3. 4.

List of I&C Standards and Specs Process Control Diagrams Control Systems Specification

4. 5. 6.

Instrumentation & Control Systems



Notes


Category/Discipline

Layout/Piping Design


Item


5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30.

Instrument Index Updated Instrumentation Database Instrument Design/Purchasing Specs Functional Process Control Specifications Control Room and Panel Layouts Instrument Logic Diagrams DCS and PLC Configuration Code Instrument Vessel/Equipment Sketches Instrumentation Purchase Order / Material Requisitions Instrument Location Plans Instrument Loop Diagrams Instrument Tray/Conduit/Cable/Piping Layouts Instrument Installation Details Instrument Winterization Distribution Instrumentation Wiring/Termination Lists Key Plans Panel Layouts Tray Schedules Fire Alarm Drawings Alarm Setting Summary Console Layouts I/O & Control Bldg Equipment Room Layout DCS Configuration/Database I/O Slot Arrangements Manufacturer’s Data & Design Records Spare Parts List

31. 32. 33. 34. 35. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22.

Cable Schedules Control System Block Diagrams Control & Logic Narratives Graphics Operating Manuals Piping Design Criteria List of Piping Standards & Specs Engineering Studies Plot Plans Key Plans Battery Limit Connections Plan Piping General Arrangements & Elevations Piping Sections and Details Isometrics w/ Bills of Materials Demolition Isometrics Piping Specialty Data Sheets Stress, Load & Support Calculations Pipe Material/Purchase Requisitions Pipe Support Drawings Steam Tracing Isometrics Electrical Tracing Isometrics Engineering Calculations/Studies U/G Piping, Drains, Sewers Layout Drawings A/G Piping Key Plans/Elevation Drawings Vendor Design & Fabrication Drawings - Equipment General Arrangements - As Builts from OEM


Notes


Category/Discipline

Civil


Item


23. 24. 25. 26. 27. 28. 29. 30. 31. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11.

- Maintenance & Repair Manuals - Operating Manuals Pipe Spool Fabricators Data & Design Record - Spool Sheets - MTRs w/ Traceability Reports - NDE Summaries w/ NDE Reports - Hydrotest Reports Piping Material Specification Sheets Isometrics Civil/Structural/Architectural Design Criteria Site Soils & Subsurface Investigations/Reports Site Surveys C/S/A Standards & Specifications Key Plans Engineering Calculations Design/Purchasing Specifications Site Preparation & Development Drawings Demolition Drawings Site Rough Grading Drawings Tank Farm Berms, Drainage & Pit Layouts and Details Piling Layout and Schedules Foundation & Pile Cap Layouts Dwgs & Plans Concrete Drawings – Plans, Sections, Details Site Paving/Ditches Drawings Structural Steel Drawings – Plans, Sections, Details Structural Steel Bills & Material Structural Steel Purchase Order / Material Requisitions Architectural Drawings – Plans, Sections, Details Underground Drawings incl. Sewers & Drains Building Requirements - Building Criteria - Building Codes Analysis - Renderings - Building Perspective - Landscaping Plans, Sections, Details - Floor Plans - Roof Plans - Buildings, Elevators and Sections - Ceiling Plans - Door Schedules - Finishes Schedules - Furnishings Schedules - Plumbing Layout and Details Vendor Design/Shop Drawings - Rebar Drawings - Pre-cast Concrete Drawings - Structural Steel Drawings Manufacturer’s Data & Design Records - Equipment General Arrangements - As Builts from OEM - Maintenance & Repair Manuals

12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42.


Notes


Category/Discipline

Electrical

Item 43. 44. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36.

Painting/Insulation/Fire Proofing

37. 38. 39. 1. 2. 3. 4. 5. 6.


Deliverable Title/Description - Operating Manuals Dewatering and Temporary Drainage Electrical Design Criteria List of Electrical Standards & Specs Engineering Studies Engineering Calculations Load Lists/Short Circuit Studies Key Plans Plot Plans Electrical Equipment List Single Line Diagrams Wiring Diagrams Schematics Area Classification Drawings Lighting Layouts Power Systems Power Layout Grounding Layouts Cathodic Protection Electrical Panel Schedules EHT Systems - Isometric Drawings - Power Drawings - Control Drawings Cable Routing and Schedules Cable Tray Layouts U/G Conduit/Cable Runs Electrical Design/Purchasing Specifications Electrical Material Purchase Order / Material Requisitions Electrical Wiring/Termination Lists Electrical Installation Details Electrical Equipment Data Sheets Communications, Architecture & Drawings Software Monitoring System Licenses Vendor Manuals - Vendor Design Drawings Manufacturer’s Data & Design Record - Equipment General Arrangements & Sections - As Builts from OEM - Maintenance or Repair Manuals - Operating Manuals Painting Design/Purchasing Specifications Insulation Design/Purchasing Specifications Fire Proofing Design/Purchasing Specifications List of Painted/Insulated/Fireproofed Equipment List of Painted/Insulated/Fireproofed Piping List of Painted/Insulated/Fireproofed Structural Steel


Notes



2.5

Performance Testing EMPLOYER expects the FEED-EPC Contractor to remain in responsible charge of the facilities until all expected Performance Testing of the units have been successfully completed. Detailed plans and coordination procedures for this important work will be developed during the course of the project, and in sufficient time for the adequate planning, recruitment, orientation and training of EMPLOYER personnel intended to operate and/or maintain the Modernized Refinery.

2.6

Final Acceptance Final acceptance for the FEED-EPC Contractor is defined in the Agreement.


FEED

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