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Petroleum Development Oman L.L.C.

Document Title: Specification for Commissioning and Start-Up (Key Principals)

Document ID SP-2113

Document Type Specification

Security Unrestricted

Discipline Engineering and Operations

Owner UOP – Functional Production Manager

Issue Date December 2010

Revision 1.0

Petroleum Development Oman LLC Revision: 1.0Effective: Dec-10

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SP-2113 - Specification for Commissioning and Start-Up (Key Principals)

Printed 14/12/10

The controlled version of this CMF Document resides online in Livelink®. Printed copies are UNCONTROLLED.

This document is the property of Petroleum Development Oman, LLC. Neither the whole nor any part of this document may be disclosed to others or reproduced, stored in a retrieval system, or transmitted in any form by any means (electronic, mechanical, reprographic recording or otherwise) without prior written consent of the owner.


i Document AuthorisationAuthorised For Issue – December 2010


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ii Revision HistoryThe following is a brief summary of the 4 most recent revisions to this document. Details of all revisions prior to these are held on file by the issuing department.

Revision No.

Date Author Scope / Remarks

1.0 Dec-10 Robin Norman UOP6 1st Issue

Draft Dec-10 Robin Norman UOP6 Draft for review

iii Related Business Processes

Code Business Process (EPBM 4.0)

EP.64 Design, Construct, Modify and Abandon Facilities

EP.65 Execute Operations Readiness and Assurance Activities

EP.71 Produce Hydrocarbons

EP.72 Maintain and Assure Facilities Integrity

iv Related Corporate Management Frame Work (CMF) Documents

The related CMF Documents can be retrieved from the Corporate Business Control Documentation Register CMF.

See Appendix 3


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TABLE OF CONTENTS

1 Introduction....................................................................................................................... 6

1.1 Purpose....................................................................................................................... 6

1.2 Review and Improvement.............................................................................................6

1.3 Step-out Approval........................................................................................................6

2 Strategy............................................................................................................................ 7

Figure 1 – RACI Overview....................................................................................................8

3 Flawless Project Delivery...................................................................................................9

4 Asset Ownership and Asset Management Transfer Strategy............................................10

4.1 Asset Ownership........................................................................................................10

4.2 Asset Management Transfer......................................................................................10

4.3 Final Asset Management Handover............................................................................11

4.4 Acceptance criteria....................................................................................................11

5 Commissioning Management System & Completions Tools.............................................13

5.1 Commissioning Management system structure...........................................................13

5.1.1 Strategy...............................................................................................................13

5.1.2 Control................................................................................................................13

5.1.3 HSE.................................................................................................................... 13

5.1.4 Flawless Project Deliver (FPD)............................................................................14

5.2 Certification and Completions Management System...................................................14

5.3 Systemisation............................................................................................................14

6 Organisation.................................................................................................................... 16

Figure 2 – CSU Organisation at Pre-Commissioning / Commissioning.................................16

Figure 3 – CSU Organisation Post RFU..............................................................................17

7 Competence.................................................................................................................... 18

Appendix 1 – Definitions and Terminology..............................................................................20

Appendix 2 – Abbreviations....................................................................................................22

Appendix 3 – Reference Material............................................................................................23


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1 IntroductionThe Pre-Commissioning, Commissioning and Start-Up of facilities have been an area of concern in PDO. The “Key Principles” detailed in this specification shall be used to develop the “Commissioning and Start-Up Strategy” produced in the Select Phase.

IMPORTANT: The “Commissioning and Start-Up Strategy” is a DCAF deliverable.

The Key Commissioning and Start Up (CSU) Principles are aligned to the PDO Procedure PR-1159 Engineering and Operations Commissioning and Start-Up

The Commissioning and Start-Up Phase of a P roject is characterised by: The risks of producing (toxic sour) oil and gas at pressure for the first time in

the life of a facility;

The requirement to utilise systems and procedures of the Operations Management System (OMS) and Emergency Response (ER) system for the first time;

The requirement to ensure that Process Safety and Asset Integrity are assured at all times;

The complexity of operating a new facility where multiple parties are present and multiple activities are being completed simultaneously;

For a brown field development: Integration of the new facilities into the existing operation;

IMPORTANT NOTE: For High H2S (Sour) Project an extra phase may be needed where the facility is gassed up with sweet Hydrocarbons. Only once the facility has been tested on sweet hydrocarbons the Sour hydrocarbons will be introduced.

1.1 PurposeThe purpose of this specification is to ensure the Commissioning and Start-Up Strategy is consistent throughout all projects and addresses the Key Principals detailed here in.

1.2 Review and ImprovementResponsibility for the upkeep of this Specification shall be with Functional Production Manager, UOP, the Owner. Changes to this Document shall only be authorised and approved by the Owner.

Users of the Document who identify inaccuracy or ambiguity can notify the Custodian or his/her delegate and request changes be initiated. The Requests shall be forwarded to the Custodian using the “User Feedback Page” provided in the Appendix.

The Document Owner and the Document Custodian should ensure review and re-verification of this document every 3 years.

1.3 Step-out ApprovalDeviations (Step Outs) from this specification shall be governed by PR-1247 - Project Change Control & Standards Variance Procedure, and require the authorisation of the Project Manager and endorsement from the Specification Owner.


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2 StrategyThe PDO CSU strategy for Pre-Commissioning and Commissioning shall be direct supervision by a PDO lead CSU team, but may augmented by CSU staff from a specialist CSU contractor.

Utilities systems shall normally be pre-commissioned / commissioned ahead of any other system to supply energy to all systems. The Start-up shall be supervised by the Operations Team supported by the CSU team (refer to remark 1 in Figure 1 and Section 4.2).

IMPORTANT NOTE: Support services for Pre-Commissioning and Commissioning shall be provided by the EPC and this shall be reflected in the contracting strategy.

Such support services may include:

Technician workforce

Scaffold

Riggers

Material Support & Management

Vendor call off

Consumables supply

First Fills

Admin assistance

Planners

Test Equipment

Tools

NOTE: Other strategies are possible, but they may place greater reliance on contractor’s competence and capability to execute CSU activities. Recent experience in PDO projects has shown major shortcomings in the EPC community.

The CSU strategy shall be part of the EPC Contract scope, roles and responsibilities. The Scope shall include system milestone payments that meet optimum start up sequence rather than area and commodity based payments.


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Figure1 RACI Overview compliments this strategy:

Responsible Parties Construction Pre-

Commissioning Commissioning Start-Up Operate

Asset Owner Oil & Gas Director Oil & Gas Director Oil & Gas Director Oil & Gas Director Oil & Gas Director

Asset Manager PDO Project Manager

PDO Project Manager

PDO Project Manager

PDO Operations Manager (NOTE) PDO Operations

ManagerPDO Project Manager

Activity Lead PDO Construction Manager

PDO CSU Manager

PDO CSU Manager

PDO Delivery Team Leader PDO Delivery

Team LeaderPDO CSU Manager

Activity Team EPC

PDO CSU Team PDO CSU Team PDO Operations Team PDO Operations

TeamEPC EPC PDO CSU Team

Mechanical PSUACompletion

RFSU Introduction of Hydrocarbons (Process Fluids)

Project to Asset Transfer

Figure 1 – RACI OverviewNOTE:- From the RFSU point forwards, through Start-Up and up to Final Handover, Operations will assume the overall responsibility for; the ‘day-to-day’ management of the facility; introduction of hydrocarbons; start-up activities; operations of hydrocarbon systems; management of personnel on the facilities and access control; management of HSSE, PTW, SIMOPS, MOPO and emergency response; OMS; hydrocarbon accounting; and production management.


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3 Flawless Project DeliveryFlawless Project Delivery (FPD) shall be a structured process geared towards early identification of potential flaws in a project and methods of ensuring dedicated mitigation of these flaws. The process shall utilise a variety of inputs into a work process. The work process shall continue through the life time of the project and shall be carried by dedicated staff in the project organization (Refer to PR-1612 - Operations Readiness and Assurance).

The FPD process will enable elimination of flaws that prevent systems from achieving a smooth start-up and steady state (production) operations (at the specified capacity) as soon as possible.

Application of FPD shall be mandatory in all projects exceeding 100 Million US$ value.


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4 Asset Ownership and Asset Management Transfer Strategy

4.1 Asset OwnershipAsset Ownership rests in PDO with the Oil or Gas Director in accordance with CP-115 - Operate Surface Product Flow Assets - CoP and shall:

be accountable for Production Operations Management in their Directorate;

be accountable for all Assets in the Directorate (Asset Owner);

be accountable for authorising asset abandonment within their Directorate, and ;

provide members of the Technical Directors Group

4.2 Asset Management TransferThe Construction Manager shall take the systems to Mechanical Completion (verification via Completions Management System (CMS)), after which the CSU Manager shall then take the systems through Pre-Commissioning and Commissioning.

The CSU Manager shall coordinate the Asset Management transfer from the Project Manager to the Operations Manager. This Asset Management transfer shall be planned and take place only after the acceptance criteria has been met.

On completion of a satisfactory Pre-Start-Up Audit, which shall include closeout of all high (I) priority PSUA and A ‘punch list’ action items and verification that the facilities are ready for start-up, management of the facilities shall be transferred from the Project Team to Operations. Referred to as “Custody Transfer”.

NOTE: B and C punch list items shall also require to be closed prior to SU, or transferred to an exception list.

From the RFSU point forwards, through Start-Up and up to Final Handover;

Operations will assume the overall responsibility for; the ‘day-to-day’ management of the facility; introduction of hydrocarbons; start-up activities; operations of hydrocarbon systems; management of personnel on the facilities and access control; management of HSSE, PTW, SIMOPS, MOPO and emergency response; OMS; hydrocarbon accounting; and production management.

Projects (including the contractor if applicable) shall remain responsible for integrity performance; preservation and defect management of the facility; shall supply all relevant procedures, materials and consumables; and supporting manpower, including technical support, to allow safe operation and performance verification of the facilities. Identified CSU team members will be retained for the SU phase.

During the initial start-up, functional and integrity tests, capacity test and reliability proving periods, up to final acceptance of the plant, the project/ contractor shall support the asset manager with sufficient technical support, labour and materials to evaluate performance, and to identify and rectify technical malfunction or breakdown.


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Depending on the contract, the contractor may have little responsibilities post start-up, e.g. warranty issues and defect management. It may be necessary for the asset manager to take ownership / leadership of follow-on activities with technical assistance taken from in-house engineering contractor or the project engineering contractor under the direction of the CSU team.

These considerations shall be incorporated in the Project (EPC) contract.

4.3 Final Asset Management HandoverSustainable steady-state operations shall be achieved prior to completion of the Execution Phase and Final Acceptance.

Sustainable steady-state operations shall be defined prior to FEED and will be measured over an agreed period following Custody Transfer, during which time the contractor shall provide “warrantee /guarantee” cover for the facilities.

Acceptance criteria shall be agreed between the Project Team and future Asset Owner and be developed during FEED, thus avoiding any confusion / grey areas.

The acceptance criteria for final handover shall be and agreed with the future Asset Manager and documented for each handover point as described above.

On completion of a satisfactory Final Acceptance Audit, the full responsibility for management of the asset will be transferred to the Operations Manager, which closes the Execution phase. Responsibilities of the Project shall cease at that point.

Any outstanding items at the time of provisional acceptance and final acceptance must be documented and arrangements (budget, resources, plans, timeline), satisfactory to both Project and the Asset Owner, recorded to deal with the outstanding items. At this stage the CSU organisation and the project organisation can be abandoned.

Performance testing shall be carried out in accordance with procedures agreed in advance by the equipment / system vendors and included in the overall Test Plan, in order to demonstrate the contractual guarantees on equipment and systems.

Final acceptance shall be the point at which the Operations Manager accepts the full ownership of the facilities from the Project Manager. Prior to final handover a final Acceptance Audit shall be carried out. To meet the requirements for final acceptance a number of pre-defined agreed conditions underpinned by the FPD methodology must have been met and exceptions agreed. Those exceptions will be handed over including budgets and resources.

4.4 Acceptance criteria Performance testing shall confirm the operating envelopes and targets and may include the following:

Capacities

Product Qualities (Sulphur Specifications in particular)

Production sales specification: quality, amount;

No flaring or flare limitation achieved;

Noise levels;

Nitrous oxide/ sulphurous oxide and carbon dioxide emissions;

Produced water quality;

Availability profile against timeline;

Less than a certain number of trips in a certain period; SP-2113 - Specification for Commissioning and Start-Up

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Less than a certain number of alarms in a certain period;

No alarm overrides;

Maximum flow;

Turndown;

Chemicals, utilities and catalyst consumption;

Technical availability (uptime) in first year of operation;

Achieving sustainable steady state against timeline;

Asset Integrity Verification System, Safety Critical Equipment (SCE) and Production Critical Equipment (PCE).

Operations Integrity Assurance system definition (OIA)

ESP; Ensure Safe Production is the standard for Live Operating Envelopes, Alarm Management, and Handovers.


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5 Commissioning Management System & Completions Tools

5.1 Commissioning Management system structureA Commissioning Management System will need to be developed in the Detail Design phase. This system comprises of processes, practices and procedures that ensure the effective management of the asset throughout the commission phase and will include following elements as a minimum:

5.1.1 Strategy Commissioning Execution and Start Up Strategy (this document)

Handover Procedure

Systemization Procedure

Start Up Network

Commissioning Manual (PR-1159)

5.1.2 Control Manpower Resource Plan including Vendor mobilisation plan

Level 4 Pre-Commissioning and Commissioning schedule

Spade / Blinds Management Procedure

Punch list Guidelines

Commissioning procedures

Commissioning Spares

First fills/Chemical register

System / Sub-system list

System marked up drawings (PEFS, Elec, Instr etc.)

Temporary equipment register

GU-623 - Project Completion Management System CMS Guideline

5.1.3 HSE HSE plan and reporting system

Commissioning Emergency response Procedures

Journey Management Procedure

Emergency Response Plan

Waste Management Plan

Permit To Work Manual


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5.1.4 Flawless Project Deliver (FPD) Q Plans (FPD implementation plan)

5.2 Certification and Completions Management SystemAn electronic database system shall be used to capture and track the status of all system tags, subsystems and systems, and associated punch lists in a structured manner, enabling verification and recording completion of check sheets and punch list items.

The completions system approved by PDO is the Certification and Completions Management System (CCMS) and is supplied by QEDi. The Use of CCMS shall be mandatory in PDO for all projects.

Guidance on the use of CCMS will be in accordance with GU-623 - Project Completion Management System CMS Guideline.

CCMS shall be used to track all phases of construction mechanical completion, hook-up and commissioning to ensure every system is checked and all procedures are completed before the system is handed over.. This fit-for-purpose, comprehensive certification program permits a wide range of construction and commissioning check sheets to be easily tailored to fit the specific requirements of each project.

CCMS shall be used throughout the project execution process - from planning and development to construction mechanical completions and handover, through pre-commissioning and commissioning, to the handover to operations - and includes complete phase-by-phase punch list tracking. The CCMS shall be owned and populated by the Project Team under responsibility of the Project Manager.

Engineering information from indexes, cable schedules and equipment lists are automatically loaded into the program and check sheets are assigned. The scope of work shall be reviewed by system leads, then assigned to field personnel to complete.

CCMS has a wide range of reporting features to cover construction performance, commissioning activities and punch list reports, and can also determine handover status among the various teams generating graphs showing planned and actual progress.

CCMS is tailored to track progress of written commissioning procedures, which other programs do not cover.

CCMS is based upon Microsoft Access, which allows information to be easily imported and exported. Authorized users may access comprehensive reporting features while the construction and commissioning data are still secure, prior to handover to operations.

5.3 SystemisationPre-Commissioning (sub system / discipline driven), Commissioning (system driven) and Start-Up shall be ‘systems’ based. Early in the FEED phase of the project these (sub) systems shall be defined and agreed, including all interfaces.

Systems shall be defined from a commissioning start-up point of view and be as ‘large as possible’ parts of a unit to enable operations to make individual commissioning and start-up progress.


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A system shall be a composite assembly of hardware that has a singular purpose within a unit, that can be commissioned and brought to Ready For Start Up (RFSU) status, to a significant extent, without dependency on other systems.

The (sub) systemization approach must be applied not only to process (including utility) systems, but also non-process systems i.e. civil and building works, and all supporting electrical, telecom and instrument facilities.

The main reason for systemization shall be to achieve Mechanical Completion (MC) followed by Ready For start UP (RFSU) in a structured way, thus enabling the introduction of hydrocarbons.


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6 OrganisationThe Commissioning Process shall be a Project Deliverable hence the Project Manager remains responsible for Commissioning and Start-Up until Final Handover. Start-Up i.e. the Introduction of Hydrocarbons shall be effected by an Operations Team that is competent in the operation of live hydrocarbon facilities.

Refer to Section 4.2 for a description of the responsibilities for the CSU manager and the Operations Manager

The Commissioning Start-Up (CSU) Team shall start-up and operate the non-hydrocarbon systems during commissioning activities until these systems are fully proven and handover to Operations can be carried out. See Figures 2 & 3 below for Organisation and Reporting relationships.

Figure 2 – CSU Organisation at Pre-Commissioning / Commissioning


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At RFSU (point of hydrocarbon introduction) the organization and reporting relationships shall be as Figure 3 below.

Figure 3 – CSU Organisation Post RFUAt RFSU the custody of the facility shall be handed over to the Operations Manager who will be responsible for the introduction of hydrocarbons in accordance with first start-up procedures which shall have been agreed with by Project and Asset Operations Managers. These procedures shall incorporate sufficient steps and safeguarding actions to verify that it is safe to start-up the plant, to increase throughput to nameplate volumes and to hold at a steady state for an agreed, uninterrupted period. After achieving steady state operations performance testing shall be carried out. Refer to Figure 1 – RACI Overview.


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7 CompetenceIn the lifecycle of a facility the Commissioning and Start-Up period covers a relative short period. The specific skills for the CSU process are difficult to build as staff tends to be absorbed in the Operations organisation or if contract staff, will dissipate to a next, possibly Non-PDO, project.

The CSU engineer shall show competence in the following:

1. Commissioning Organisation

Staff Experience requirements

Operator Involvement/ Integration

Key Positions

Functions and functional requirements

2. Commissioning Planning

Understanding CSU scope

Logic

Schedule

Commissioning Execution

Work Scope method statements

FPD methodology

3. Commissioning Deliverables

Systemisation

System Handover and punch listing

Commissioning procedures

CCMS

Administration procedures

(Vendor) Site support requirements

Vendor procedures and documentation

Training modules

Commissioning spares

First Fills

4. HSSE in Commissioning

Permit to Work

SIMOPS

Risk Assessment Methodology and Job Hazard Analysis

HSSE management and Operations HSSE Case

Regulatory requirements

Environmental Restriction (Flaring, water disposal etc)

ER requirements during CSU


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5. Start-Up and Initial Operation

PSUA (Pre-Start-Up Audit)

RFSU (Ready for Start-Up)

Handover processes

Performance verification processes

First start-up procedures

Start-Up Time Line

Use of KPI’s


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Appendix 1 – Definitions and TerminologyTo prevent misunderstanding and confusion the following definitions and terminology shall be used for the Commissioning and Start-Up process (ref. PR-1159).

Commissioning ProcessThe Commissioning Process verifies that equipment and systems that have not been operated before, or have been modified, are brought into operation safely and in the correct sequence.

Mechanical Complete (MC)Mechanical completion is a milestone achieved when all specified work is complete and subsequent acceptance inspection and physical testing is satisfactorily performed and documented.

Pre-CommissioningPre-Commissioning activities undertaken after mechanical completion, but prior to commissioning, are to prove and validate the functioning of equipment. Such activities could involve the introduction of fluids into systems, but not hydrocarbons

CommissioningThese activities are those undertaken after pre-commissioning to dynamically verify functionality of equipment and to ensure that systems, or facilities forming part of a system, are in accordance with specified requirements to bring that system into operation. Hydrocarbons are not introduced.

Pre-Start-Up Audit (PSUA)Prior to introduction of hydrocarbons, a Pre-Start-Up Audit shall be carried out. The audit shall verify key items such as:

Facilities are constructed as per design;

Operations philosophy is complied with;

Asset integrity is verified and can be demonstrated;

Necessary vendor support is identified and scheduled;

Operations staff are sufficiently trained and competent;

Operations Management System (OMS) is operable and ready for steady-state operations;

Commissioning ‘imperatives’ are in place and complied with;

Project assurance in place;

HSE-MS is in place;

Confirm physical readiness for start-up;

Emergency Response team and enablers tested and functional prior to start-up

The Pre-Start-Up Audit will be used to demonstrate the readiness of the facilities, systems and operations organisation to operate.


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Ready for Start-Up (RFSU)RFSU is considered as the point when all activities necessary to support the introduction of hydrocarbons (process fluids), including all utility and process utility, Process Automation System (PAS), safeguarding and shutdown systems have been pre-commissioned, commissioned and integrity has been verified.

Start-UpFollowing commissioning of the facilities, production of hydrocarbons (or process fluids) starts, when product specifications are met the export or injection into formations can commence.


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Appendix 2 – AbbreviationsThe following abbreviations have been used in this specification.

CCMS Certification and Completion Management System

CMS Completion Management System

CSU Commissioning & Start-Up

DCAF Discipline Controls and Assurance Framework

EPC Engineering, Procurement, Construction

ER Emergency Response

FEED Front End Engineering Design

FPD Flawless Project Delivery

HSSE Health, Safety, Security, Environment

MC Mechanical Complete

MOPO Manual Of Permitted Operations

OMS Operations Management System

OR&A Operations Readiness and Assurance

ORP Opportunity Realisation Process

PAS Process Automation System

PDO Petroleum Development Oman

PEFS Process Engineering Flow Scheme

PSUA Pre Start Up Audit

PTW Permit to Work

RFSU Ready for Start-Up

SCE Safety Critical Element

SIMOPS Simultaneous Operations


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Appendix 3 – Reference MaterialCP-115 - Operate Surface Product Flow Assets - CoP

PR-1159 Engineering and Operations Commissioning and Start-Up

PR-1247 - Project Change Control & Standards Variance Procedure ,

PR-1612 - Operations Readiness and Assurance

GU-623 - Project Completion Management System CMS Guideline

Flawless Project Delivery Process


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