4.0 - Procedure

< Security Level 2 > Sheet 1 of 8

MECHANICAL COMPLETION PROCEDURE FOR NITROGEN PACKAGE FOR HINDUSTAN PETROLEUM CORPORATION LTD. VISAKH REFINERY

DHT PROJECT JOB NO.

: 6261

DOCUMENT NO. : 6261–A–100–920-001

A Rev. no.

24.04.2009 Issue Date

UCM

For Bid Enquiry

Description

PRK

Prepared by Checked by Approved by

TOYO ENGINEERING INDIA LIMITED MUMBAI

SSV

INDIA

< Security Level 2 > Sheet 2 of 8

Revision history Rev.

Date

A

24.04.2009

Description

For Bid Enquiry

< Security Level 2 >

MECHANICAL COMPLETION PROCEDURE TOYO ENGINEERING INDIA LTD.

HPCL, Visakh ISSUED : 08.09.2008 DOC.No. 6261–A–100–920-001

JOB NO. : 6261 HDHT PROJECT

Sheet 3 of 8

CONTENTS

SL

Page No.

1.0

Intent …………………………………………………………….….

4

2.0

Definitions ……………………………………………………………..

4

3.0

Relevant procedures ………………………………………………...

5

4.0

System concept for mechanical completion ……………………

5

5.0 5.1 5.2 5.3 5.4

Procedure up to mechanical completion …………………………… Flow chart for mechanical completion ……………………………… Final inspection ……………………………………………………… Punch list …………………………………………………………….. Letter of agreement for mechanical completion ……………………

7 7 7 7 8

Annexure (1)

Definition of mechanical completion ( 21 sheets )

Annexure (2)

System concept for mechanical completion ( 1 sheet )

Annexure (3)

Flow chart for mechanical completion ( 1 sheet )

Annexure (4)

Request for final inspection ( 1 sheet )

Annexure (5)

OWNER punch list ( 1 sheet )

Annexure (6)

Letter of agreement for mechanical completion ( 1 sheet )

Annexure (7)

Revision history ( 1 sheet )

Rev. : Doc. No. : 6261–A–100–920-001

< Security Level 2 >

MECHANICAL COMPLETION PROCEDURE HPCL, Visakh ISSUED : 08.09.2008 DOC.No. 6261–A–100–920-001

1.0

TOYO ENGINEERING INDIA LTD.

JOB NO. : 6261 HDHT PROJECT

Sheet 2 of 8

Intent This Mechanical Completion Procedure (hereinafter referred to as “PROCEDURE”) has been prepared in order to achieve an expeditious MECHANICAL COMPLETION by identifying discipline work responsibilities of CONTRACTOR and the OWNER. This Procedure shall be made “Job Specific” based on Definition of MECHANICAL COMPLETION in the Contract as well as “Scope of Work” as per Contract.

2.0

Definitions In the PROCEDURE, the following terms and phrases having the respective meanings.

2.1.1 “OWNER” shall mean HINDUSTAN PETROLEUM CORPORATION LTD. (HPCL) and shall include its successors and permitted assigns. 2.1.2 "CONTRACTOR" shall mean the successful Bidder(s) selected by the OWNER as Lump Sum Turnkey Contractor for the execution(s) of the Detailed Engineering, Procurement, Construction, Pre-commissioning and Commissioning & Performance Guarantee Test Run including Total Project Management of the Licensed Process units and shall include the successors and permitted assignees of the CONTRACTOR and if the CONTRACTOR is Joint Venture or Consortium, shall include each member thereof shall include its successors and permitted assigns. 2.1.3 “PMC” shall mean TOYO ENGINEERING INDIA LIMITED, Mumbai, India (Hereinafter referred to as TOYO INDIA) who is Project Management Consultant appointed by OWNER. 2.1.4 “CONTRACT” shall mean the Contract between OWNER & CONTRACTOR including all annexure and all documents attached and amendments which the parties may hereafter agree in writing to be made to this CONTRACT. 2.1.5

“LICENSOR” shall mean any agency chosen that will be responsible for the supply of know how, basic engineering package and technical services for the Process Units.

2.1.6 “PROJECT” shall mean proposed NITROGEN PACKAGE at Vizag for which PMC shall provide services under the CONTRACT. 2.1.7 “WORK” shall mean an includes all things to be done or provided by the CONTRACTOR in connection with design, engineering ,procurement, construction, pre commissioning, commissioning, performance guarantee test run and / or installation of the facilities together with all other obligation and responsibilities of the CONTRACTOR under and pursuant to this contract. 2.1.8 “PROJECT SITE” shall mean the site demarcated for the Project at Vizag.

< Security Level 2 >

MECHANICAL COMPLETION PROCEDURE HPCL, Visakh ISSUED : 08.09.2008 DOC.No. 6261–A–100–920-001

TOYO ENGINEERING INDIA LTD.

JOB NO. : 6261 HDHT PROJECT

Sheet 3 of 8

2.1.9 “MECHANICAL COMPLETION” shall mean the completion of all activities of the Project other than the activities relating to commissioning and other activities as defined in the CONTRACT. 2.1.10 “ACCEPTANCE” shall mean the acceptance by OWNER after the Project has been declared as mechanically completed in all respects as defined in the Contract and has been taken over by OWNER for commissioning. 2.1.11 “VENDOR” shall mean any party supplying any of the equipment / materials for setting up the Project under an order placed by OWNER. 2.1.12 “SERVICES” means and includes the Project Management Consultancy services undertaken by PMC under the CONTRACT. 2.1.13 “CHANGES” means changes, additions, deletions in the scope of the work and services of PMC in accordance with the CONTRACT. 2.1.14 “OFF-SHORE EQUIPMENT AND MATERIAL” means the equipment and materials to be procured by OWNER for ISBL & OSBL Portion from sources outside India recommended by PMC through procurement services. 2.1.15 “ON-SHORE EQUIPMENT AND MATERIAL” means the equipment and materials to be procured by OWNER for ISBL & for OSBL Portion from sources inside India recommended by PMC through procurement services. 2.1.16 “EFFECTIVE DATE” means date on which CONTRACT becomes effective pursuant to the provisions of the CONTRACT. 3.0

Relevant Procedure This PROCEDURE is to be read in conjunction with: Document No. 6261 / PP / 007 – Field quality control procedure

4.0

System concept for mechanical completion MECHANICAL COMPLETION of the PLANT shall be defined to mean that the last SYSTEM of the PLANT is completed, inspected and tested in accordance with the codes, standards, and specifications. CONTRACTOR shall follow Annexure (1) “DEFINITION OF MECHANICAL COMPLETION”. Prior to declaring Mechanical Completion, 1. Contractor shall carryout PMI (Positive Material Identification) test of the Unit for all Process piping, Heat Exchanger flanges; vessel flanges etc and provide a report to the OWNER / PMC

< Security Level 2 >

MECHANICAL COMPLETION PROCEDURE HPCL, Visakh ISSUED : 08.09.2008 DOC.No. 6261–A–100–920-001

TOYO ENGINEERING INDIA LTD.

JOB NO. : 6261 HDHT PROJECT

Sheet 4 of 8

2. CONTRACTOR shall provide an inspection report for all vessel/columns after installation and confirm that these are as per Process Package. Any deviation shall be brought to the notice of OWNER/ PMC /Licensor as possible for taking corrective measures. 3. All precaution for hydro testing of Alloy steel piping shall be taken by contractor including use of correct type of water, drying of piping with compressed air after hydro test, preservation etc. 4. CONTRACTOR shall ensure that all isolation valves, which are lock open / closed, shall be procured and installed accordingly. All globe valves, check vales or any other devices/elements which have a directional feature shall be checked for correct installation. 5. All sample station shall be installed as per P&ID’s / Engineering requirement and considering safety aspects.

As soon as any unit, section or systems of the plant is mechanically completed and tested in accordance with the applicable standards, codes of engineering practice and specifications, CONTRACTOR shall notify to the OWNER of the aforesaid completion in writing with a request for the issue of certificate for MECHANICAL COMPLETION. The standard form of the letter as per Annexure (6) hereto is to be referred to. Such Unit, section or likewise shall be referred to as SYSTEM (Annexure (2) : “SYSTEM CONCEPT FOR MECHANICAL COMPLETION” hereto is to be referred however it can only be used as a basis for compiling a “job specific procedure” list, therefore each item shall be individually reviewed, assessed and revised where necessary, to ensure that all the relevant contractual requirements of the specifications, drawings, procedures, manuals, applicable codes of practice and engineering standards are fulfilled as per the Contract).

5.0

Procedure up to mechanical completion

5.1

Flow chart for mechanical completion

< Security Level 2 >

MECHANICAL COMPLETION PROCEDURE HPCL, Visakh ISSUED : 08.09.2008 DOC.No. 6261–A–100–920-001

TOYO ENGINEERING INDIA LTD.

JOB NO. : 6261 HDHT PROJECT

Sheet 5 of 8

The flow chart in Annexure (3) hereto summarises the detailed MECHANICAL COMPLETION OF THE PLANT. The flow chart also shows the split for the sequence of work items to be performed by CONTRACTOR and the OWNER. 5.2

Final inspection All field inspection shall be conducted in accordance with “FIELD QUALITY CONTROL PROCEDURE,” document No. 6261/ PP / 007 When CONTRACTOR considers any SYSTEM is substantially completed in accordance with the CONTRACT, CONTRACTOR shall issue a letter requesting for final inspection. Annexure (4): “REQUEST FOR FINAL INSPECTION” hereto is to be referred to. The request letter for final inspection shall include the following information: (1)

Description of the SYSTEM,

(2)

Extent of SYSTEM

(3)

Together with the above letter, CONTRACTOR shall submit the total Field Inspection Summary Sheet for the concerned SYSTEM.

On receipt of the information from CONTRACTOR the OWNER shall inspect the SYSTEM to ascertain whether the requirements and conditions for MECHANICAL COMPLETION are satisfied and agreed as per CONTRACT. 5.3

Punch list Where the OWNER considers MECHANICAL COMPLETION is not satisfied, they shall issue a punch list, Annexure (5) hereto, to CONTRACTOR, within (7) days from the date of receiving the inspection request. Upon receipt of the OWNER’s punch list, CONTRACTOR shall take corrective action to attend to all the punch items it deems necessary to fulfill its contractual obligations. Each punch item satisfactorily completed and inspected shall be dated and initialed by the OWNER and CONTRACTOR jointly. Upon completion of the punch list, it shall be signed by OWNER with Mechanical date of completion.

< Security Level 2 >

MECHANICAL COMPLETION PROCEDURE HPCL, Visakh ISSUED : 08.09.2008 DOC.No. 6261–A–100–920-001

5.4

TOYO ENGINEERING INDIA LTD.

JOB NO. : 6261 HDHT PROJECT

Sheet 6 of 8

Letter of agreement for mechanical completion After attending to, and completing the punch points, or if the OWNER state on the punch list that the requirements and conditions were satisfactorily completed for MECHANICAL COMPLETION by Signing and Dating on the appropriate section then CONTRACTOR shall issue the request to the OWNER to issue the LETTER OF AGREEMENT FOR MECHANICAL COMPLETION. The request to the OWNER to sign the LETTER OF AGREEMENT FOR MECHANICAL COMPLETION shall contain the following information as per Annexure (6) hereto. (1)

Description of the SYSTEM

(2)

Extent of SYSTEM

(3)

Outstanding items if any.

The completed punch list shall be submitted to OWNER / PMC as a final inspection document, together with the request for LETTER OF AGREEMENT FOR MECHANICAL COMPLETION. The OWNER shall sign the LETTER OF AGREEMENT FOR MECHANICAL COMPLETION, and return it to CONTRACTOR as soon as possible after receipt. This will facilitate CONTRACTOR to achieve milestone as stipulated in the contract and further enable CONTRACTOR to start commissioning activities of the system with the help of OWNER’s / Licensor’s operation personnel.