scope of work

Upstream Americas Controlled Document

Sierra Blanca/Cruz de Lorena Early Production Facility

Scope of Work

Project Sierra Blanca/Cruz de Lorena Early Production Facility

Document Title Scope of Work

Document Number SB-1000-VA-5793-0003

Document Revision 02

Document Status Approved for Use

Document Type Scope of Work

Owner / Author James Alexander

Issue Date 03-Feb-14

Expiry Date None

ECCN EAR 99

Security Classification Restricted

Disclosure None

Revision History shown on next page

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SB/CdL Early Production Facility Scope of Work Revision 02

UA Upstream Americas

Proprietary Information: This document contains proprietary information and may not be partly or wholly reproduced without prior written permission from SHELL Upstream Americas

Revision History REVISION STATUS APPROVAL Rev. Date Description Originator Reviewer Approver 01 16-Dec-13 Issued for Review J. Alexander See Below R. Elston 02 3-Feb-04 Approved for Use J. Alexander R. Elston

All signed originals will be retained by the UA Document Control Center and an electronic copy will be stored in Livelink

Signatures for this revision

Date Role Name Signature or electronic reference (email)

Construction Pablo Deblassi/ Mike Hanson

Engineering David Chapman/Duane Jubert/ Rajesh Patwari/Noel Lee/ Neil Skulski/ Mohamed Askar/ Jim Lemaire

IM/IT Stephen Brooks/Jonathan Trieu

Contracts and Procurement Jeremy Turpin/Daniel Caranti

Quality Wallace Hallum

HSSE/Technical Safety Daniel Fagan/Melissa Velasquez

Project Services Ron Windon/Melissa Morris/Emilie Cook

Operation Readiness/CSU Roger Balke/Kevin Capone

Environmental Gustavo Rosales/Richard Lewis

Project Delivery Arg Javier Suarez/Claudia Zapiola

Project Delivery Hou Rob Timmerman/Marc Villareal/Eddie Murtagh/Daniel Marklin

APPROVER Rob Elston

Summary

Scope of Work for Sierras Blancas/Cruz de Lorena Early Production Facility which is a subproject of the SB/CdL Early Production System being executed by SHELL P&T Onshore Projects.

Keywords

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Argentina, Sierras Blancas, Cruz de Lorena, Early Production Facility, EPF, Scope of Work

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TABLE OF CONTENTS EXECUTIVE SUMMARY .............................................................................................. 5 1. PROJECT BACKGROUND .................................................................................. 7 2. CONTRACTOR SCOPE OF WORK ..................................................................... 8

2.1. Engineering .............................................................................................. 9 2.2. Procurement ............................................................................................ 17 2.3. Construction............................................................................................ 17 2.4. Mechanical Completion ........................................................................... 20 2.5. Flawless Project Delivery .......................................................................... 20 2.6. Commissioning and Start-Up Support ....................................................... 23 2.7. Permit Support ........................................................................................ 25

3. SPECIFICATION GAP ASSESSMENT PROCESS ................................................. 26 4. PROVIDED BY SHELL ....................................................................................... 27 5. ADDITIONAL REQUIREMENTS ......................................................................... 27

5.1. Language ............................................................................................... 27 5.2. Units ...................................................................................................... 28 5.3. Software ................................................................................................. 28

6. SCHEDULE ...................................................................................................... 28 7. INTEGRATED PROJECT CONTROLS ................................................................. 28

7.1. General .................................................................................................. 28 7.2. Project Controls Plan (PCP) ....................................................................... 29 7.3. Reporting................................................................................................ 29 7.4. Project Management of Change ............................................................... 31 7.5. Project Calendar ..................................................................................... 32 7.6. Integrated Project Planning ....................................................................... 33 7.7. Progress Management ............................................................................. 37 7.8. Cost Control ............................................................................................ 39

8. INFORMATION MANAGEMENT & DOCUMENT NUMBERING .......................... 41 9. INTERFACE MANAGEMENT ............................................................................ 41

9.1. General .................................................................................................. 41 9.2. Communication between SHELL and CONTRACTORs ................................. 42 9.3. Communication between CONTRACTORs ................................................. 42 9.4. Meetings ................................................................................................ 43 9.5. Review & Comment and Approval ............................................................ 44

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EXECUTIVE SUMMARY

The Early Production Facility is a centralized pilot facility handling production from Sierras Blancas and Cruz de Lorena Blocks. Nameplate capacity is 10,000 barrels of oil per day (bopd), 8MMSCFD gas, and 1,000 barrels of water per day (bwpd). Oil will be separated, stabilized, stored, pumped, and metered prior to entering the oil export line. Gas will be separated, compressed, dehydrated, and metered prior to entering the gas export pipeline. Water will be separated, treated, filtered, and stored prior to being injected into a nearby water disposal well. The scope of the EPF begins at the outlet of the Gathering System and ends at the inlet of the export pipelines which will be a pre-defined surface flange near the edge of the EPF for oil and gas and at the flange of the wing valve on the water disposal well. Included in the scope of the EPF:

Civil Earthworks for EPF and access roads including civil engineering and design All surface production and measurement equipment (separators, chemical

injection, heaters, air coolers, instrumentation, control systems, programming, etc) including requisite supports

Compressors with foundations (per geotechnical recommendations) Oil and Water Storage Tanks including foundations LACT (Lease Automatic Custody Transfer) Unit Gas export meter Interconnecting pipe work including pipe supports and anchors Interconnecting cabling and wire including supports and grounding Water Treating, filtration, and pumping equipment Water disposal piping and instrumentation from EPF to Water Disposal Well Fencing around Water Disposal Well Pad Solar Power at Water Disposal Well Pad Local power generation including load calculations Firewater system Storm Water Management Roadways within site Control Room and Accommodation Buildings Site perimeter fencing Surface instrumentation on water disposal well head

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Onsite Communication Tower(s) for SCADA and IT from remote well pad facilities Closed Circuit Televisions (CCTVs) for monitoring of remote well pad facilities Installation in accordance with applicable codes and standards Commissioning and Start-Up Procedures/Manual including first fill calculations Equipment systemization for startup (start up sequence with accommodations for

start up, i.e. temporary fuel, temporary power, method for first fills,) Commissioning and startup spares Operating spares for 2 years Operating procedures Black Start procedures Commissioning and Start-Up Support Permit application support

Excluded from the scope of the EPF: Land Acquisition Disposal Well and Well Head Operations Chemicals and diesel first fills for facility equipment National, Provincial, and Municipal Permit applications

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1. PROJECT BACKGROUND

SHELL has interests in three onshore blocks in the Neuqun region of western Argentina as shown in the figure 1 below:

Figure 1. SHELL Interests in Argentina

Aquila Mora - 42,000 acres

Cruz de Lorena (CdL) - 39,000 acres

Sierras Blancas (SB) - 41,400 acres

Exploration and appraisal wells have begun to be drilled and are being produced utilizing temporary well pad equipment. However, flaring of gas and trucking of crude oil for long periods of time is not aligned with SHELLs Onshore Operating Principles. Hence it was decided to progress an Early Production System (EPS) that would enable sustainable production. A schematic of the full EPS and how the EPF fits in is provided below.

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Figure 2. Representative EPS Layout

2. CONTRACTOR SCOPE OF WORK CONTRACTOR Scope of Work consists of all Engineering, Procurement, and Construction as well as associated Project and Construction Management requisite for the successful operation of the Early Production Facility in accordance with Early Production Facility Basis for Design Part I EPF-MFPM-AA-7704-000-0001-000 Revision 03 and Part II EPF-MFPM-AA-7704-000-0001-000 Revision 03. Prior to submitting Proposal, CONTRACTOR is expected and required to be familiar with general conditions of the site including terrain, climate, road accessibility, soil variability, etc. In addition, CONTRACTOR is required to be well versed in all local legislative and regulatory requirements including those applicable to local content requirements, employment laws, and unions.

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CONTRACTOR shall validate concept design information provided by SHELL and is encouraged to recommend alternatives to reduce cost and/or improve schedule while maintaining the same functionality such as that for Water Treating.

2.1. Engineering CONTRACTOR shall perform requisite engineering and design in accordance with applicable codes, standards, best design practices, and SHELL mandated DEM1 requirements. Design shall mature in progression from Concept as proposed by SHELL to a Final Engineered Design by CONTRACTOR with requisite review and approval by SHELL. Reviews shall consist of document & drawing reviews (2D), 3D Model Reviews, Constructability Reviews, Hazard & Operability (HAZOP) reviews, and Pre-Start-UP Audit (PSUA) reviews as described below. Formal document reviews shall be submitted to SHELL via Document Control.

2.1.1. Document and Drawing Reviews

The following documents and drawings delivered as part of CONTRACTORs Scope shall be reviewed and approved by SHELL as noted. Documents requisite for other activities (i.e. HAZOP & Permitting) is also indicated.

Define ID #

Execute ID # Document Name

Required for Permit

Application

Required for HAZOP

Approved by 1-Nov-

14

Issued for Review by 1-

Nov-14 IFC

Project Management

338 Project Execution Plan x

1517 Derogations and Deviations Log (Standards) x

331 Constructability Report x

179 CP Execution Plan, incl Project Category Plan (CPEP) x

346 1417 Project Organisation incl. roles, responsibilities, resourcing and onboarding plan x x

399 Risk Management Plan & Risk Register x

406 1258 Interface Management Plan x x

395 462 Project Schedule - Level 3 x x

Health, Safety, Security, Environment & Social Performance (HSSE & SP)

1615 1620 Construction Contractor's HSSE Management Plan x x

1613 457 Emergency Response Plan x x

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Define ID #


Required for Permit

Application

Required for HAZOP

Approved by 1-Nov-

14


Nov-14 IFC

1616 1621 Construction HSSE Readiness Review Report x x

1413 449 Process Safety Review (eg HAZOP) x x x

Project Services

1387 Project Specific Cost and Schedule Procedures x

1628 Schedule Basis Report x

1404 Project Controls Plan x

1404.1 Management Of Change Plan x

Quality Assurance

591 1433 Project Quality Plan (inc FATs & licensor reviews) x x

Logistics

355 Logistics and Infrastructure Project Execution Plan x

Process Engineering & Technology

242 1213 Process Flow Schemes (PFS) x x x x

1497 1242 Equipment Listing x x x

241 Process Safeguarding Flow Schemes (PSFS) and Memorandum x x

251 655 GHG (Greenhouse Gas) and Energy Management Plan x x

243 1214 Process Engineering Flow Schemes (PEFS/P&IDs) x x x

249 1211 Relief, Flare and Vent Study Report x x x

420 Heat and Material Balance Report -Final x x x x

Mechanical, Materials, and Integrity

298 Corrosion Inhibition System Design & Test Proposal x

298.1 Functional Specification for the Corrosion Inhibition system x

298.2 Corrosion Inhibition Test Proposal x

298.3 Establish Chemical Test Requirements x

298.4 List of pre-qualified corrosion inhibitors x

298.5 Specify/initiate corrosion inhibitor testing x

298.6 Select hydrotest chemicals. x

302 488 Welding & Weld Inspection Specifications x x

1219 Tie In List & Schedule - Final x

487 Vibration Assessment Report x

267 1247 Plot plans/ Mechanical General Arrangement Drawings/ Facilities layout report x x x x

269 HVAC Design Report x

270 Mechanical Static Equipment Data Sheets and Specifications x x

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Define ID #


Required for Permit

Application

Required for HAZOP

Approved by 1-Nov-

14


Nov-14 IFC

1411 Materials and Corrosion Data Sheets and Specifications x x

1411.1 Produce required materials specifications x x

1411.2 Produce required coating specifications x x

1411.3 Produce required cathodic protection specifications x x

1411.4 Produce other material and corrosion integrity associated equipment specifications x x

297 Materials Selection Report x x

297.1 Consider all type of deterioration x x

297.2 Consider design temperature and maximum operating temperature x x

297.4 Review interactions between chemicals and materials x x

300 Corrosion Management Framework x

300.1 Execute Failure Mode and Effects Analysis. x

300.4 Include erosion and sand handling. x

Electrical Engineering

238.1 1426.5.1 Electrical Bldg Layout x x

238.2 1525 Electrical One Line Diagram x x x

238.3.2 1426.5.2 Cable Routing Layout x x 1426.5.4 Lighting & Receptacle Layout x x 1426.5.5 Grounding Layout x x x 1426.7 Panel Layout & Wiring Diagrams x 1426.8 Electrical Schematics & Connection Diagrams x 1426.9 Electrical Heat Trace Drawings (if applicable) x 1426.10 Electrical Installation Details x

1399.1 1426.11 Cable Schedule x x 1452.1 Protective Device Settings (Breakers & Relays) x

283 1426.3 Electrical Equipment Data Sheets and Specifications x x

278 1249 Electrical load list - Incl. Efficiency Column x x x

280 1426.1.2 Electrical Power and Protection System Study x x x

245 1217 Hazardous Area Classification Drawings x x x

Process Automation Controls and Optimization (PACO)

1642 1452 Telecoms Systems Design Package x x

1641 1634 Alarm Management Design Package x x

1639 1498 Instrumentation Design Package x x

667 Process Control Design Package x

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Define ID #


Required for Permit

Application

Required for HAZOP

Approved by 1-Nov-

14


Nov-14 IFC

257 1209 Instrumented Protection Systems and Fire & Gas Design Package x x x

683 Process Control Detailed Design & Construction Package x x x

684 Surveillance, Metering and Allocation Detailed Design & Construction Package

x

Rotating Equipment

1398.9 Compressor surge control and protection x

275 Rotating Equipment Data Sheets and Specifications x x

273 Rotating Equipment Type Selection Report x x

Utilities, Energy, and Heat Transfer

1390 1435 Utility Flow Schemes (UFS) x x x x

1391 1449 Utilities Engineering Flow Schemes (UEFS/P&IDs) x x

1412 Utilities and Heat Transfer Equipment Data Sheets and Specifications x x

Civil, and Structural Engineering

289 1220 Site Master Plan / Facilities layout x x x x

238.504 Buildings, structural steel, and concrete design x x

238.505 Foundations design x x

238.506 Drainage & Primary Treatment Report x x

238.509 Underground cabling and piping design x x

238.512 Construction camps x

238.513 Temporary facilities x

238.514 Onshore site preparation x

238.516 Roads, paving, and fencing x x

288 Off Plot Civil Logistics/Infrastructure Requirements x

Pipelines

Maintenance and Integrity

1524 Spare Parts Strategy x

332 486 Reliability, Availability and Maintainability Report addressing sparing, RRM and turndown

x x

Information Technology (IT)

Information Management (IM)

1643 1637 IM Scope of Work and Information Specification x x

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Define ID #


Required for Permit

Application

Required for HAZOP

Approved by 1-Nov-

14


Nov-14 IFC

Production Operations

1453 Alarm Catalogue x

440 Operating Procedures x

414 431 Commissioning and Start-up (CSU) Plan x X X

Miscellaneous

Vendor document requirement list X

Handling & shipping plan procedures X

Preservation Plan and procedures X

Drafting Standards X

Drawing title block X

* A list of descriptions for above deliverables can be found in Appendix I. Supplementary Documents.

2.1.2. 2D and 3D Model Reviews

CONTRACTOR shall conduct 30%, 60%, and 90% 3D Model reviews to afford the SHELL and CONTRACTOR teams to remain aligned and identify potential concerns which are best demonstrated via a visual representation of planned layouts. 2D drawing reviews shall occur prior to 3D model reviews. Meeting minutes of the review shall be captured including an action list, action owners, and time to complete. 30% Model Review The focus of a 30% model review is on accessibility, safety, layout, ergonomics and constructability. At a minimum, the items listed below should be included in the 30 % model review:

Location and orientation of all equipment including future Designated areas for Pipelines, launchers, receivers Structures (steel and concrete inclusive fire proofing) Containment Areas

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Electrical generators location Plot determining piping, electrical corridors Main access ways / operational access; Major piping and pipeways that influences equipment positions; Concrete slabs, paving and roadways Packaged unit location and orientation Escape routes (on grade and elevation) Pipe racks and main pipe support structures Outline of underground electrical and instrumentation trenches Main electrical and instrumentation cable trays / racks Laydown areas Mobile crane aprons (based on available cranes and on lifting study) Major Equipment Fencing

60% Model Review The focus of a 60% model review is on engineering. The 60 % model review shall be carried out and closed out prior to issuing the piping isometrics for construction. At a minimum, the items listed below should be included in the 60 % model review:

Closed out actions resulting from the 30 % model review All other piping largely completed Ladders, stairs and platforms Platforms for valves and equipment and operation Secondary steelworks and bracing Eyewash and safety shower locations (per applicable regulations) Pipe supports locations and types Local operation panels Instrument transmitters and outlines of junction boxes, secure instrument air vessels;

panels and cabinets inclusive stands, safety critical sensors / switches Electrical equipment such as outdoor switchracks and panels Aboveground instrumentation and electrical tray routing. Package units (if any)

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90% Model Review This revision is intended to be a confirmation of the results of the 60 % model review and prepare for construction readiness. The model shall be completed to include:

Closed out action items from 60% review Any late or special items; Any change since the previous reviews; All remaining piping.

2.1.3. Constructability Reviews

CONTRACTOR shall perform Constructability reviews to ensure constructability issues and concerns are addressed as early as possible during design development. CONTRACTOR may choose to combine these reviews with other reviews (i.e., 2D, 3D, other). CONTRACTOR, along with representation from the SHELL Team, shall perform Constructability reviews to ensure constructability issues and concerns are addressed as early as possible during design development. Contractor may choose to combine these reviews with other reviews (i.e., 2D, 3D, other). Proposed Constructability Review Schedule:

Pre-Constructability Review - Frame Construction Strategy & Deliverables o HSSE considerations o Application of modules o Procurement strategy o Equipment inspection and release o Logistics o Draft plot plan o Opportunities for modularization o Equipment list and BOM with division of roles and responsibilities o Contracting strategy o Construction input for project execution strategy and project implementation

plans e.g. risks, o Initial project schedule and estimate considerations

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o Document distribution matrix

Initial Plot Plan Review o Develop project specific plot plan with equipment lay out, lay down area,

trailer area, muster area, smoking area o Consider terrain and define special logistic requirements o Division of shop and field activities o Construction equipment consideration 30% Model & Constructability Review 60% Model & Constructability Review 90% Model & Constructability Review

Prior to construction mobilization and the execution of any field activities, CONTRACTOR must be able to demonstrate that they are ready to proceed with construction. This involves verification that management systems are in place, adequate planning has been conducted, procedures and training requirements are completed, and that the construction hazards have been adequately evaluated and controlled. These activities should be accomplished through a series of formal Construction Readiness Reviews (CRR) as outlined below. Construction Readiness Review Schedule:

60 Day Construction Readiness Review 30 Day Construction Readiness Review 7 Day Go / No Go Construction Readiness Review After Action Review / Lessons Learned

2.1.4. HAZOP Reviews

CONTRACTOR shall host a Hazard and Operability (HAZOP) review for the Early Production Facility. This review shall consist of a SHELL Facilitated session focusing on Asset Integrity, Process Safety, and Operability risks and will be attended by CONTRACTOR staff and SHELL representatives. CONTRACTOR shall be responsible to close out and incorporate all HAZOP findings as appropriate and agreed by SHELL into the design of the EPF. SHELL will not accept facility at Handover until all recommendations have been closed.

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Prior to HAZOP, the 60% design review should have occurred to eliminate the possibility of the HAZOP becoming a design review.

2.2. Procurement CONTRACTOR shall comply with all applicable local content legislation within the region of Neuqun and in particular, Ley N2755: "Compre Neuquino". CONTRACTOR is responsible to procure and pay for all requisite labor, material, equipment, goods, and services required to perform all phases of work. CONTRACTOR must have written approval from authorized COMPANY representative prior to placing any Purchase Order (P.O.) to vendors or SUBCONTRACTORS. Importation and associated customs payments of material, equipment, and/or services procured from outside Argentina is the responsibility of CONTRACTOR SUBCONTRACTORs are required to meet SHELLs Safety Requirements. CONTRACTOR shall provide a complete Vendor Document Requirement List for approval for major equipment prior to procurement. In the event CONTRACTOR does not have a VDRL, SHELL can provide. Although not mandated, Emerson is preferred for instrumentation.

2.3. Construction Construction shall be in accordance with the approved Issued for Construction (IFC) Drawings and Specifications. CONTRACTOR is responsible to provide all labor, equipment, and supervision required to perform work. This includes but is not limited to bull dozers, scrapers, cranes, forklifts, onsite material storage, power tools, welding machines, welding rods, fuel, power, water, toilets, trash bins, structural steel, rebar, concrete, silt fencing, geotextile fabric, gravel, paint, consumables, etc. In addition, CONTRACTOR is responsible for any temporary facilities and infrastructure required to perform work, site security while under the care of CONTRACTOR, and waste removal during construction. Site shall be kept clean and orderly during the course of

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construction and all debris and waste shall be removed prior to completing of Project. Waste disposal shall be in accordance with all laws and regulations. Contractor shall provide temporary service for cell phone and internet (WiFi) connectability at location from beginning of construction until Handover to Operations.

2.3.1. Civil Earth Works

CONTRACTOR is responsible for Access roads to site Clearing and grubbing site Storing top soil, per applicable laws Leveling site including compaction Drainage in accordance with applicable laws and regulations Surfacing, Leveling, Compaction and Drainage of plot space and roads Tank Containment with 1000 micron thick HDPE liner & sump Signage Quarry Control, if required (Contractor shall provide all the Documentation that SHELL

requests concerning Quarry Permits)

2.3.2. Civil/Structural/Architectural

CONTRACTOR is responsible for Installation of shallow and deep foundations Fabrication and installation of racks and miscellaneous supports Fabrication and installation of buildings and any structures Stairs, platforms, walkways, cross-over stiles, etc Windsocks, bollards, and barricades Signs (as per applicable codes and standards) Perimeter fencing and gates with minimum standards as per ASTM requirements Control Room and accommodations

2.3.3. Mechanical

CONTRACTOR is responsible for Shop and/or field fabrication for interconnecting pipe Installation of all equipment, interconnecting pipe

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Installation of underground piping & associated mechanical integrity per design Installation of field erected tanks Painting Integrity testing of installation

2.3.4. Electrical and Instrumentation

CONTRACTOR is responsible for Installation of all instrumentation and electrical equipment Installation of electrical generation and distribution equipment Developing and installing arc flash and shock hazard labels Installation of telecommunication tower Installation of tubing, cables, wires, and grounding Installation of SCADA system including RTUs, HMI, VSAT Installation of IT Systems including CCTV and VSAT Inspection & testing of electrical equipment per NETA ATS or equivalent requirements Installation of area lighting Programming validation including early system interconnectability (ensuring the

processors communicate with each other) Calibration of instrumentation Point to Point Testing Loop Testing

2.3.5. Quality Assurance/Quality Control

NOTE: All changes to IFC drawing shall be supported with an approved MOC. CONTRACTOR is responsible for and to provide all documentation in a binder for Non-Destructive examination Hydrotesting Continuity Checks Loops Checks As-Built drawings for P&IDs, One lines, wiring diagrams, Cause & Effect, Plot Plan As-built Plot Plan showing all buried piping, cabling, tubing Material Test Reports and Certifications Welding Operator Qualification Records Welding reports

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X-Ray Reports Weld Map for High Pressure Flowline Proctor testing Electrical equipment inspection and testing including records of results

2.3.6. Material Management

CONTRACTOR is responsible for Material Management in terms of storage, preservation, and tracking of items procured by CONTRACTOR.

2.4. Mechanical Completion Mechanical Completion is defined as the time at which all checks and tests of all equipment and construction (mechanical, electrical, instrumentation, & civil) are complete confirming that the installation is in accordance with drawings and specifications and ready for commissioning in a safe manner and in compliance with project requirements. A punch-list of non-safety critical items shall be created by CONTRACTOR and followed to closure. CONTRACTOR shall provide a Certificate of Mechanical Completion stating the work is complete in accordance with the approved Issued for Construction drawings and Specifications.

2.5. Flawless Project Delivery Typically, over two thirds of projects in Oil, Gas and Petrochemical industries experience costly interruptions during the Commissioning, Start-Up (CSU), and Initial Operation phases of the facility. Flawless Project Delivery (FPD) is essentially a risk mitigation program focusing on a number of high risk or Quality areas (Q Areas) for the Commissioning & Start-Up. These risks are referred to as Flaws. A Flaw is a learning that falls in a Shell defined Q-Area and is a deficiency or failure which, if not remedied will manifest itself mostly during Commissioning and Start-up phases in deferred production, loss of HSE control, delayed schedule, or additional cost. Flaws are mostly of a technical nature and result mostly from failures, e.g. poor design, poor equipment specification, construction practices and/or lack of appropriate QC and testing during procurement & execution activities.

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Shell has a Global Flawlist which has been developed based on the experiences from previous projects and are to be used as input in developing the project-specific Flaws list for this project. CONTRACTOR shall incorporate FPD into their work plans by assigning focal person to coordinate plans with the support of SHELL to develop and achieve delivery of a flawless project. CONTRACTOR shall schedule time and provide the resources to implement the following 5 Q-Area activities outlined in the table below.

Q-Area #

Q-Area Q-Area definition

Q01 Tightness Tightness of all components in a system is essential for a Right First Time start-up. Tightness of a system has two elements: external and internal tightness. External tightness focuses on the leak free operation of all system connections including flanges, caps, clamps, manholes, pump casings, compressor casings, instrument fittings and all other joints that require sealing for operation of a system. CONTRACTOR shall 1) Ensure correct bolt tightening method is being followed. (manual, torque wrench or hydraulic tensioning, correct sequence) 2) Check that lateral and parallel flange alignment is correct ( as per specification) 3) Verify correct gaskets are being used, installed gasket color coding is visible and gasket dimension is correct.

Q02 Cleanliness & Preservation

Cleanliness of a system is essential for a Right First Time start up. Emphasis shall be placed on building a clean plant. All equipment shall be preserved at appropriate moments in

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Q-Area #


different execution phases. CONTRACTOR shall 1) Secure vessel and pipe openings 2) Installation methods for final internal inspection 3) ensure nothing is stored in pipe or equipment

Q3c Mechanical Rotating Integrity

Ensure that Mechanical Rotating Equipment performs as per the original Design Intent for all Operating Modes. It typically addresses: bearing/coupling/complete failures, excessive vibration and noise, seal/flange/casing/lube oil leakages and failures, unauthorised deviations from PO documents, incomplete/incorrect mechanical installation, cleanliness/fouling/corrosion/erosion, preservation CONTRACTOR shall

1) Ensure excellence in workmanship with regards to compressor and pump alignment, along with associated piping.

Q3d Instrumentation Integrity

Ensure that all control and safeguarding systems, including their field instrumentation, perform as per design intent, both in static and in a dynamic mode. It typically addresses problems with: process control, (field) instruments, online and in-line instrumentation, analysers, DCS, IPS, Data Historian, and 3rd Party Instrument Systems. CONTRACTOR shall

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Q-Area #


1) Verification of processor communication between systems and packages

2) Clear instrument calibration requirements including alarm and trip settings

3) Programming aligns with field devices and termination location (loop terminations and programming match)

4) System operates in a fail safe mode

Q3e Electrical Integrity

Ensure that the electrical systems and components, e.g. power supply, UPS, network distribution (e.g. ENMCS), motor control systems (e.g. IMCS) correctly function. CONTRACTOR shall

1) Ensure Generator capacity is adequate (load study, account for VDF filtration, etc.)

2) Verify Grounding is consistent between packages (solid/high resistance)

3) UPS is available on all control and monitoring systems (instrumentation, PLC, HMI, etc.)

2.6. Commissioning and Start-Up Support Commissioning and Start-up will be performed by SHELL. CONTRACTOR shall work with SHELL in developing a Commissioning and Start-Up Plan as well as any training requirements. CONTRACTOR is responsible to provide requisite documentation, document creation support, and actual field support. CONTRACTOR is required:

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To provide and facilitate the formation and identification of vendor resources for start-up activities.

To provide required information for the decision-making, application and regulatory processes.

To provide guidance to address known and unknown project flaws that materialize during pre-commissioning, commissioning and start-up.

To provide reference manuals for all associated equipment To provide a notebook that will contain as-built P&ID's on a system by system basis,

partial commissioning check lists, instrument loop check list, rotating equipment mechanical run log sheets, vibration and bearing temperature logs, PSV calibration certification certificates and the control loop checks lists, operational pressure tests, U1A forms, Factory Acceptance Test (FAT) and Site Acceptance Test (SAT) documentation, instrument detail, electrical detail.

i. Mechanical Completion Definition and Scope ii. Pre-Commissioning Scope iii. Commissioning Scope (Safety Check, System Commissioning) iv. System Boundary Limits (sub/system and discipline boundaries) v. Electrical and Instrument circuit/loop Inspection and Test Plan vi. Mechanical Completion and Pre-Commissioning Verification and Punch

Listing vii. Punch list Management viii. Mechanical Completion Files ix. Commissioning Files x. FAT Inspection Documentation: xi. Initial start-up procedures

In developing the above, the following Engineering Documentation Requirements and References will be included:

i. Electrical area classification drawings and register ii. One-lines/Wiring & schematic diagrams/Cable & panel schedules iii. Electrical equipment settings (VFDs, UPS, Breakers, Relays, Generators) iv. Power Systems Study v. Instrument Indexes with calibration ranges and alarm/trip set points

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vi. Piping Line Lists (including Pipe Class) vii. Marshalling Box/Junction Box Schedules viii. Vendor Lists ix. Vendor Manuals including all vendor documents/drawings, CONTRACTOR

CSU and Operating Manuals x. Commissioning Spares Lists xi. Valve Lists xii. Cause and Effects Charts xiii. Trip Register/Schedule xiv. System P&IDs xv. HVAC P&IDs xvi. Schematic Diagrams for Piping xvii. Isometric drawings xviii. Tagging Spreadsheets xix. Equipment Data Requisition Sheets xx. Engineering Details (I&E, mechanical, civil, structural etc) xxi. Underground Drawings xxii. Control Narrative

2.6.1. Final Handover Package

CONTRACTOR shall provide a Final Handover Package consisting of all Engineering Deliverables updated per As-Builts. One (1) hard-copy shall be provided in a notebook and an electronic copy shall be provided with indexes in PDF.

2.7. Permit Support SHELL will prepare, apply and obtain all national, provincial, and municipal permits requisite for the construction and operation of the EPF. CONTRACTOR shall provide Permit support to SHELL via generating required design documents and assisting with answering clarifying questions as the need arises. Documents identified as being required for Permitting shall be brought to sufficient detail and Issued for Permitting within 60 calendar days from Contract Placement. Contractor shall share all knowledge of required permits in the region along with common issues or concerns with obtaining permits.

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3. SPECIFICATION GAP ASSESSMENT PROCESS SHELL will take the approach of utilizing CONTRACTORs standards for engineering and construction with the following caveats to ensure Asset Integrity and Process Safety is intrinsic to the design:

All applicable codes and standards mandated by legislative and/or regulatory bodies will be followed without exception

SHELLs Design Engineering Manual (DEM)1 (SHALL[PS]) requirements that are code requirements and/or applicable and value adding will be used

All of SHELLs applicable DEM2 requirements will be met which consists of o Safe Siting of Occupied Portable Buildings from process systems o Utilizing a Permit to Work Process o Utilizing a Management of Change Process o Avoiding liquid release relief to atmosphere o Avoiding tank overfill followed by vapor cloud release o Avoid brittle fracture of metallic materials o Utilize Alarm Management o Mitigation plan for H2S

Hence, non-DEM1 SHELL Design Engineering Practices (DEPs) will not be provided to CONTRACTOR to follow unless CONTRACTOR does not have a standard of their own to follow. In that event, the DEP will be followed on an as convenient basis in which variances to standards in those DEPs that are not followed are not documented. Non-Process Safety Shalls (i.e., lower case shalls) in DEM1 DEPs that are not followed will not be formally varianced. To ensure CONTRACTORs Standards meet SHELLs ALARP (As Low As Reasonably Practicable) aspiration for technical safety, a gap analysis will be performed to identify any potential gaps between CONTRACTORs Standards and SHELLs applicable DEM1 requirements. A list of applicable DEM1 and DEM2 requirements has been generated and will be provided to short listed CONTRACTORs to identify potential gaps as well as identify cost and schedule implications to implement. Short listed CONTRACTORs will be requested to indicate if their standards meet the DEM1 requirements which will be validated by the applicable Technical Authority (TA) in SHELL. In the event CONTRACTORs Standards do not comply with an applicable DEM1 requirement, the deficiency will be evaluated within the context of how else the risk may be mitigated (i.e., other barriers such as operating procedures, different hardware, etc). If an acceptable alternative risk mitigation is identified, the DEM1 requirement will be

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derogated with the approval of the applicable TA1. In the event an acceptable alternative risk mitigation is not identified, CONTRACTOR will be required to meet the DEM1 requirement and requested to provide a Cost and Schedule impact. Only after the resolution of the gap analysis along with a full understanding of the cost and schedule impacts associated with the mandated DEM1 requirements will the contract with CONTRACTOR proceed. Once finalized, any variation from the approved Specifications and Standards (CONTRACTORs or SHELLs) will be required to go through the Project Change Management Process for approval by the applicable Technical Authority to ensure Asset Integrity and Process Safety is never inadvertently compromised.

4. PROVIDED BY SHELL The following documentation is provided to support CONTRACTORs Engineering, Procurement, and Construction efforts. Technical Early Production Facility Basis for Design Part I: EPF-MFPM-AA-7704-000-0001-

000 Revision 03 Early Production Facility Basis for Design Part II: EPF-MFPM-AA-7704-000-0003-

000 Revision 03 EPF Site Plan: SB-1000-MP-4024-0001 Revision 01 EPF Access Plan: SB-1000-MP-4024-0002 Revision 01 Geotechnical Report To be provided later Interfaces Pipeline Tie-In Locations (To Be Determined) Launcher and Receiver Locations (To Be Determined) SCADA requirements for remote well pads (To Be Determined)

5. ADDITIONAL REQUIREMENTS

5.1. Language The primary language for this Project and its documents will be English with Spanish as Secondary except for Permit Documents in Argentina which are required to be in Spanish. Operating manuals are required to be translated into Spanish once approved. In the event there is a conflict between English and Spanish, English will prevail unless explicitly noted otherwise contractually. Notes and Comments on drawings will be noted in English and Spanish.

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5.2. Units Units will be SI Units. Double notation with US Customary Units is not required and will not be used unless absolutely necessary. Units typically expressed in US Customary Units (i.e., nominal pipe size, flange ratings, etc) will not be converted to SI.

5.3. Software SHELLs preferred software tools are listed below. Alternatives proposed by CONTRACTOR must be approved by SHELL. Reporting Microsoft Office Scheduling Primavera P6 or Microsoft Project (with approval of SHELL) 2D Computer Aided Design AutoCAD 2012 or older 3D Computer Aided Design AutoDesk Plant 3D Process simulation UniSim / HYSYS Pipeline hydraulics OLGA / PipeSim / ProMax Power Systems Analysis SKM Power Tools for Windows ver 7.0

6. SCHEDULE SHELL has developed an overall Project schedule in which CONTRACTORs schedule is required to adhere. Proposals for schedule improvements based on CONTRACTORs ability to implement faster will be considered. Work shall commence with a kick-off meeting between SHELL and CONTRACTOR that will take place approximately 1 week after placement of Purchase Order and it is anticipated for the Early Production Facility to be mechanically complete approximately 52 weeks later, subject to changes in the plan approved by SHELL and/or events and conditions beyond CONTRACTORs control.

7. INTEGRATED PROJECT CONTROLS

7.1. General

7.1.1. Introduction

It is the intent of SHELL that project controls (related to project estimating, reporting and forecasting of cost and schedule and risk management) will be executed using CONTRACTOR standard processes/procedures as documented in CONTRACTORS Project Controls Plan (PCP) submitted by the CONTACTOR based on EXECUTION PLAN and PROGRAMME. These systems, tools, processes and procedures must satisfy the project control requirements and principles as specified in this Section. CONTRACTORS

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PCP, and supporting procedures, are subject to approval by SHELL. Where CONTRACTOR PCP and Project Controls processes and procedures do not meet COMPANY requirements CONTRACTOR will amend their processes/procedures to meet these requirements.

7.1.2. Project Controls

CONTRACTOR will be fully responsible for implementing Project Controls (relating to project reporting, cost, schedule, risk management) for the WORK. The provisions of this Section specify the minimum requirements for Project Controls on the WORK. SHELL and CONTRACTOR agree that Project Controls shall be carried out on the basis of the processes and procedures as set out in the Project Controls Plan (PCP) prepared by the CONTACTOR.

7.2. Project Controls Plan (PCP) CONTRACTOR shall detail the Project Controls processes and procedures applicable

for the WORK in the Project Controls Plan (PCP). PCP is to set out CONTRACTORs methodologies, processes (including interface and management of sub contractors), staffing of the Project Controls organization (including number of positions and equivalent number of people phased over time) and the systems that CONTRACTOR shall implement consistent with the provisions of the CONTRACT.

In preparing the PCP, CONTRACTOR shall take account of and comply with SHELLs project control requirements and principles as specified in this Section.

CONTRACTOR shall submit the proposed PCP for COMPANY review no later than twenty (20) calendar days from the PO PLACEMENT. CONTRACTOR to submit for COMPANY review the detailed procedures described in CONTRACTORs PCP no later than thirty (30) calendar days, from the PO PLACEMENT, unless otherwise agreed with COMPANY REPRESENTATIVE.

7.3. Reporting

7.3.1. General

CONTRACTOR shall provide the daily, weekly and monthly reports described in this Section and all other reports required under the CONTRACT or as otherwise agreed with COMPANY, at the times stated or as soon as possible (where no time is stated).

CONTRACTOR shall maintain detailed information to support the daily, weekly and monthly reports and shall make such information available to SHELL as and when required by SHELL.

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CONTRACTOR shall prepare each report to such level and depth of content, details and structure as agreed with SHELL in addition to the minimum content set out in this Section. Each report shall provide sufficient content and details to meet SHELLs reporting requirements.

7.3.2. Monthly Project Management Report

CONTRACTOR shall submit to SHELL Monthly Project Management Reports in accordance with the agreed Project Calendar. CONTRACTOR shall manage the closure of all electronic and data systems (including financial accruals) to meet the due date and ensure accuracy of data. CONTRACTOR shall submit to SHELL a detailed procedure which demonstrates CONTRACTORS methodology consistent with this clause and the systems that CONTRACTOR shall implement to comply with this Clause. CONTRACTORs Monthly Project Management Reports shall contain such information and details as CONTRACTOR and SHELL shall agree from time to time. As a minimum the monthly report shall include the following main sections:

i. Health, Safety, Security & Environment & Social Performance (days at zero, LTIs, TRCF, number of behavioral based safety assessments);

ii. Executive Summary (Including any CONTRACTORS or SUBCONTRACTOR issues and concerns)

iii. Planned and forecasted key milestones; iv. Cost Summary; v. Physical Progress, Schedule Performance Index; vi. Risk Management; vii. Logistics, number of transportations to and from site (miles driven). viii. Management of Change (total number of approved changes and potential

deviations); ix. Progress Photos, as applicable; x. Significant achievements during the reported period.

7.3.3. Daily Reporting

During performance of WORK at any construction site, in a fabrication yard, or in the field, CONTRACTOR shall submit to SHELL daily reports for each such WORKSITE no later than the close of business of the working day following the day covered by the report. Daily reports shall contain, but not limited to the following:

i. Construction permit requirements for the following day;

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ii. Any subcontractors present on WORKSITE in connection with the WORK; iii. Issues and concerns, their consequences and corrective action proposed or

taken. The scope of activities reported in Daily report will be in line with the Work Breakdown Structure (WBS).

7.3.4. Project Monthly Cost Report

CONTRACTOR shall submit to SHELL Monthly Cost Report in accordance with the agreed Project Calendar. The report shall be submitted no later than five (5) working days after the end of the Gregorian calendar Month. CONTRACTOR shall manage the closure of all electronic and data systems (including financial accruals) to meet the due date and ensure accuracy of data. CONTRACTORs Monthly Cost Report shall contain such information and details as CONTRACTOR and SHELL shall agree from time to time. As a minimum the Monthly Cost Report shall include the following main subjects and accompanying details:

i. Provide a narrative of the cost highlights, concerns and mitigations, reasons for variances and changes to the anticipated final cost

ii. Include CONTRACT PRICE (original and current) iii. Complete Change Order Log (includes potential, pending and approved) iv. Provide monthly expenditure of the physical progress achieved against

defined milestone activities or against an agreed contract activity breakdown based on the baseline, and the forecast (to-go) expenditure of those and all activities as described in Section 8.4.

v. Include invoice summary with the following fields listed: Invoice Number, Date, Amount, Date Payment Expected, Date Payment Received, Amount Received, Amount Outstanding, and a Cumulative Total at the bottom

vi. For provisional, reimbursable items a complete cost and commitment report shall be provided

vii. Include a procurement summary, covering all materials, equipment and services procured by CONTRACTOR with sufficient granularity as agreed with COMPANY.

7.4. Project Management of Change CONTRACTOR shall establish its Management of Change Procedure which shall implement and be consistent with the provisions of the CONTRACT on management of changes.

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CONTRACTORs Management of Change Procedure shall address all changes from the agreed baseline EXECUTION PLAN and PROGRAMME the WORK in relation to scope, cost and schedule and as a minimum shall

i. Establish the baseline for Management of Change in relation to scope, cost and schedule

ii. Recognize and communicate potential changes to the baseline in an effective and timely manner to provide early warning of potential changes

iii. Where possible develop and present mitigation options to minimize impact to quality, cost and schedule

iv. Assess the impacts of the change to quality, cost and schedule, ensuring all impacted areas of the project are considered

v. Seek approval or instruction from SHELL as required CONTRACTOR shall submit to SHELL for review, its detailed Management of Change Procedure for implementing the provisions of the CONTRACT and specifically this clause. CONTRACTORs detailed management of change procedure shall describe CONTRACTORs methodology and systems for implementing the provisions of the CONTRACT.

7.5. Project Calendar SHELL will establish a Project Calendar for the WORK with CONTRACTOR. CONTRACTOR shall develop and submit its Project Calendar for review by SHELL.

CONTRACTORs Project Calendar shall provide details and clarity on key dates, cut-off dates, meetings, submissions and any other required detail, documentation and events that will occur on a regular basis.

CONTRACTOR shall maintain the Project Calendar so as to align with any agreed changes agreed with SHELL and the updated Project Calendar shall be re-submitted as changes occur. In any event, CONTRACTOR shall review and re-issue the Project Calendar every (3) three months.

CONTRACTOR shall submit to SHELL for review, its detailed Project Calendar procedure for implementing the provisions of the CONTRACT and specifically this clause. CONTRACTORs detailed Project Calendar procedure shall describe CONTRACTORs methodology and systems for implementing the provisions of the CONTRACT.

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7.6. Integrated Project Planning

7.6.1. General

CONTRACTOR shall be responsible for all detailed planning, scheduling and integration of the activities necessary to ensure the performance and completion of the WORK in accordance with the PROGRAMME, SCHEDULE OF KEY DATES, MILESTONES.

CONTRACTORs planning and scheduling shall encompass all phases of the WORK, including those performed by its SUBCONTRACTORS. CONTRACTOR shall structure the schedules in such a way that status and progress can be aggregated in a precise and transparent way from a lower level schedule to a higher level schedule.

CONTRACTOR is required to develop all schedules to a point that it is acceptable to SHELL

Level III integrated baseline Schedule, once approved by COMPANY, shall be saved as a Target or Primary Baseline schedule, and unless a formal re-baseline or a formal change request is approved by COMPANY, updated Level III integrated baseline can only be used after full substantiation of CONTRACTOR to COMPANY and approval by COMPANY.

7.6.2. Structure and levels of schedules

CONTRACTOR shall establish and maintain as a minimum, schedules on the following Levels:

i. Level I - CONTRACT Master Schedule: One Page Project overview of the WORK, reflecting the actual status as per the project calendar by showing milestones, bars that are clearly labeled and provide a comparison with the Baseline Plan. The actual status is based on the aggregation from Level III to Level I Schedule taken in consideration progress from other sources like Physical Progress, Productivity, Earned Value, etc This Level I Schedule can be reported in different software packages like Visio, Milestones Professional or any software package as agreed with COMPANY.

ii. Level II CONTRACT Management Schedule: Schedule reflecting the essential logic, key interface, contractual milestones and activities which represent the status as per project calendar derived from the Level III Integrated Plan and enables a comparison with the baseline. The number of activities needed in this schedule can vary, but should be enough to provide sufficient granularity and agreed with SHELL to enable and support project management of the WORK.

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iii. Level III Integrated Baseline Schedule / Integrated Plan: Integrated Baseline Schedule will be developed and is consistent with CONTRACT Management Schedule and maintained as the Integrated Plan in alignment with the timely aggregation and the project status, as per project calendar from more detailed schedules as necessary and based on a robust precedence network principle; sufficient detailed logic linked activities, resource loaded and effective segregation between the different WORK by inclusion of interface milestones. This schedule supports critical path analysis and comparison with the baseline.

iv. Level IV / V Detailed schedules / Databases / Worklist / Workpacks for Engineering, Procurement, Fabrication, Construction and Handover Pre-Commissioning / Commissioning and Start-up for the WORK. These schedules will be completely managed by CONTRACTOR and form the basis of the day to day management of the WORK and will be utilized to update the progress and status of the Baseline plan (Level III).

7.6.3. Schedule Requirements

CONTRACTOR shall as a minimum adhere to the following requirements while developing and maintaining schedules at their subsequent level and enable aggregation of Level III to Level I while maintaining the integrity of the schedules:

i. COMPANY Work Breakdown Structure (WBS); each activity in the schedule shall be assigned the relevant WBS code.

ii. CONTRACTOR shall work with COMPANY to develop consistent structures within the planning software.

iii. Schedules for Level II, III shall be utilizing PRIMAVERA Project Management Release 6.1. (Or most current version) or any other planning package as agreed with COMPANY.

iv. Level III Integrated Baseline Schedule / Integrated Plan shall be resourced loaded at the activity level and will reflect the essential resources needed in sufficient granularity to prove robustness of the schedule e.g. Engineering discipline hours, construction discipline hours.

To enable and facilitate schedule evaluation, periodic updating, aggregation to higher level schedules and to meet the various progress reporting requirements each activity in the Levels II / III will be consistently assigned with the following information:

i. Activity ID Coding ii. Activity coding as per PROJECT WBS and Project Coding (e.g Area / Phase

/ System / Discipline / Responsibility, etc).

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iii. Activity descriptions for different types of work will be unique, explicit and provide sufficient granularity to be self-explanatory.

iv. Activity Duration, Remaining Activity Duration, Early Start, Early Finish, (e.g. Actual Start / Actual Finish), Total Float, Physical Progress %

Level III integrated schedule / Integrated Plan shall be Construction and Commissioning driven and shall include all linkages between these two distinct work phases to support overall integrated schedule with sufficient granularity to support critical path analysis.

Requirement of shutdowns if any, along with duration of each shutdown for completion of various modifications, tie-ins etc. shall also be reflected in the schedules.

Mandatory and Expected Finish constraints are not allowed in the schedule. Open ends in the logic network, out of sequence, redundant logic and extensive lags

are not allowed and need to be resolved before submission. The use of extensive activity durations must be limited e.g. engineering activities not

longer than 30 days, construction activities not longer than 60 days and commissioning activities not longer 30 days.

Scheduling settings will be agreed upfront with COMPANY but otherwise should be based on retained Logic and delinked Physical and Schedule progress.

Each month the updated Level III Integrated Plan shall be submitted to SHELL electronically in native file format. Any problems with the schedule will be discussed between SHELL and CONTRACTOR before amendment of the schedule by CONTRACTOR.

Changes such as new, deleted or changed logic links, new or deleted activities, modified descriptions, changed activity durations and assigned resource changes will be documented and transmitted to SHELL along with the updated Baseline Schedule.

7.6.4. Weekly Update Cycle:

In line with the Project Calendar and as a minimum every week CONTRACTOR shall report on the status, showing progress of the Level III Integrated Plan to the new status date and is able to facilitate comparison of actual progress with the Baseline Schedule on an activity-by-activity basis, by indicating the % Physical Progress details on the activity bars, actual start and finish, and estimate a start date for the activities that are not in progress and an estimate of the remaining duration (or expected finish date) for activities in progress.

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7.6.5. Interface Milestone Plan

CONTRACTOR shall develop and maintain an Interface Milestone Plan detailing essential interfaces supporting the logical network of the schedule related to the WORK (e.g. other contractors, design, procurement, fabrication and construction) reflect the timing of interfaces and allow resolution of any potential discrepancies. CONTRACTOR shall update the Interface Milestone Plan on monthly basis and issue the update to SHELL along with the PROGRAMME.

7.6.6. Punchlisting, Systems completions, Handover and System Dossiers.

CONTRACTOR shall establish and implement a systems completion system and process that will provide actual status and control over the technical and administrative completion of the PERMANENT WORK in sufficient granularity.

CONTRACTOR will provide reports showing the status of the discipline walkthrough, punchlisting, handover of facilities, systems and subsystems and all documentation needed to support the completion of the PERMANENT WORK.

7.6.7. Changes, Revision of Planning and Scheduling Documents.

CONTRACTOR shall after the approval of SHELL of the proposed changes and amendments, reflect and describe the impact of all changes and amendments in the planning and scheduling documents.

In case of any event or change having impact on the overall project completion schedule, CONTRACTOR shall submit along with each change, a detailed evaluation of the schedule impact if any, due to change in scope/sequence of work etc. Justification for schedule impact should be accompanied by a logic network, clearly highlighting the impact of such changes on the completion of intermediate milestones as well as on the overall project completion.

CONTRACTOR shall note that the submission of Revised Schedules/ Recovery Schedules by CONTRACTOR and subsequent approval of the same by COMPANY during the period of project implementation shall not relieve CONTRACTOR from its obligations under the CONTRACT. All such revisions shall only be treated as a part of the control mechanism for effective monitoring, so as to arrest/minimize progress slippages during the period of implementation.

7.6.8. Typical Schedules

Typical schedules for the WORK to be provided by CONTRACTOR in accordance with the timing as agreed with COMPANY include but not limited to:

i. Level I/II/III

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ii. 30 / 60 / 90 Days look ahead

7.7. Progress Management

7.7.1. General

CONTRACTOR shall provide accurate and timely reports on the progress of the WORK, associated cost information and the status of deliverables on the following basis:

i. The method of calculating progress shall reflect the amount of effort (typically Man Hours) required to complete the WORK.

ii. All deliverables from the WORK will be monitored and CONTRACTOR will propose the system to be used to achieve this, however, the weightings for aggregating the progress and interim progress achievement milestones shall be based on Man hours and approved by SHELL. Proposed weightings are to be submitted by CONTRACTOR within 45 (forty-five) days from the PO PLACEMENT. Approved changes will be evaluated against the established progress measurement system, method and weighting and on agreement with COMPANY reported separately or included in the progress measurement system as part of a re-baseline.

iii. All reports shall show, in an appropriate format, the approved changes, deviations and variances and their effect on the WORK and/or the SCHEDULE OF KEY DATES and/or the CONTRACT PRICE. The layout of the reports shall reflect the WBS used by SHELL. CONTRACTOR accepts that as the WORK progresses, SHELL may require reports different from and in addition to those detailed in this Section.

iv. The WORK shall be completely and comprehensively phased in alignment with the EXECUTION PLAN and the PROGRAMME, SHELL approved changes and amendments and a continuous and consistent progress control shall be carried out throughout all phases of the WORK. CONTRACTOR will ensure a consistent process is used over the whole of the WORK to ensure the aggregated progress reported represents the true progress achieved.

v. CONTRACTOR shall develop processes to capture, calculate and report progress and baseline phased expenditure by activities under Engineering, Procurement (including fabrication), Construction and Commissioning per the example below:

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Figure 3. Example Phased Expenditure

vi. CONTRACTOR shall submit to SHELL for review, its progress management procedure for implementing the provisions of the CONTRACT and specifically this clause. CONTRACTORs detailed progress management procedure shall describe CONTRACTORs methodology and systems for implementing the provisions of the CONTRACT.

7.7.2. Progress Monitoring and Measurement

Throughout the duration of the CONTRACT, CONTRACTOR shall monitor progress of the WORK against the agreed progress measurement Baseline:

i. The progress shall be aggregated up to the Level 2 Contract Management Schedules and the Level 1 Contract Master Schedule for reporting the total progress of the WORK. Progress shall be assigned on the basis of physical completion of detailed activity deliverables. CONTRACTOR shall promptly notify SHELL of any matter concerning the WORK which if not resolved, is likely to affect the achievement of the dates in the SCHEDULE OF KEY DATES.

ii. Progress shall be measured based on earned man-hours for Engineering and Construction (including Fabrication). For procurement progress shall be measured based on appropriate milestones and weightings.

iii. All forecast dates are to be supported by observed rates of progress. If the progress data does not support forecast dates then CONTRACTOR is to either:

(a) revise the forecast dates in line with measured progress, or (b) provide explanation to SHELL in the schedule report of how the

shortfall in measured progress will be remedied during the forecast timescale.

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7.8. Cost Control CONTRACTOR shall execute cost control of the WORK during the term of the

CONTRACT in accordance with requirements of this Section. CONTRACTOR shall establish a tiered level of cost control in accordance with COMPANY agreed coding system and shall be fully consistent with agreed Work Breakdown Structure. The coding system shall reflect the SCHEDULE OF KEY DATES. All labor and other costs shall be effectively monitored and controlled by CONTRACTOR for any reimbursable elements.

CONTRACTOR shall maintain and report the following cost information for reimbursable elements of the WORK, if any.

i. Summary job-hour report by Discipline/Activity ii. Summary Cost and Commitment Report iii. Procurement Summary

CONTRACTOR shall provide an estimated monetary (Incurred Cost) value for the full calendar month by the 25th of the month or the Friday before if the 25th is on the weekend.

CONTRACTOR will make use of CONTRACTORs standard cost management tool and systems, which shall be submitted (and demonstrated as considered necessary) to SHELL for approval, including examples of reports and documentation to be used, within thirty (30) days of the PO PLACEMENT.

CONTRACTOR will supply electronic cost management data to SHELL in an agreed format to minimize manual upload into SHELL systems.

7.8.1. Budget Management

CONTRACTOR will use the CONTRACT PRICE as the budget for the WORK and the basis for control and reporting. The budget will be maintained by CONTRACTOR in line with all requirements of the CONTRACT:

i. Work Breakdown Structure ii. Cost Breakdown Structure iii. Management of Change

CONTRACTOR shall submit to SHELL for review, its detailed procedure for budget management in accordance with the provisions of the CONTRACT and specifically this clause. CONTRACTORs detailed procedure shall describe CONTRACTORs methodology and systems for implementing the provisions of the CONTRACT

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7.8.2. Work Breakdown Structure

A Work Breakdown Structure (WBS) is a hierarchical subdivision of the work scope to be controlled. The purpose of the WBS is to sub-divide a project into components where the work and associated budget can be effectively managed and controlled.

CONTRACTOR will strictly conform to the WBS structure as provided by SHELL for the PROJECT. Should CONTRACTOR have the need to expand the WBS to lower levels, this is acceptable, providing this structure rolls up to SHELL specified WBS.

SHELL will submit SHELL WBS to CONTRACTOR within seven (7) days of the PO PLACEMENT.

CONTRACTOR shall submit within thirty (30) days of the PO PLACEMENT any comments of the WBS for consideration by SHELL.

The WBS will be applied by CONTRACTOR to all reporting, planning, cost control, forecasts, estimates and other relevant project processes.

7.8.3. Cost and Forecasting Expenditures

CONTRACTOR shall provide a Contract baseline phased expenditure of weekly-planned and defined milestone activities or against an agreed Contract activities breakdown for carrying out the WORK. CONTRACTOR shall also provide a monthly updated forecast phased expenditure including approved change orders, if any, that will accurately represent the Estimate at Completion (EAC) of the WORK

CONTRACTOR shall submit to SHELL for review, its detailed procedure for Cost and Forecasting Expenditures in accordance with the provisions of the CONTRACT and specifically this clause. CONTRACTORs detailed procedure shall describe CONTRACTORs methodology and systems for implementing the provisions of the CONTRACT, this clause, and SHELL standard procedures.

7.8.4. Cost Breakdown Structure (CBS)

A Cost Breakdown Structure (CBS) is a hierarchical classification of project costs by the type of cost. The purpose of the CBS, particularly in combination with the Work Breakdown Structure (WBS), is to provide a uniform cost classification basis for estimating, cost reporting and collection of historical project cost data.

This clause should be read in conjunction with the clause on Work Breakdown Structure (WBS).

Where CONTRACTOR utilizes a CBS different to SHELL standard, the data provided to COMPANY should then be mapped across to COMPANY standard. All reporting and deliverables to SHELL from CONTRACTOR shall be provided with the conversion of coding already completed. CONTRACTORs methodology for mapping and

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conversion of CONTRACTORs coding to COMPANY standard, shall be submitted for review and approval by SHELL, within 3 (three) months from the PO PLACEMENT.

8. INFORMATION MANAGEMENT & DOCUMENT NUMBERING Upon successful award of Contract, all documents shall be transmitted to SHELL via Document Control utilizing LiveLink with a transmittal sent to [email protected] for subsequent distribution internal to SHELL. CONTRACTOR will be provided a designated LiveLink space to submit documents along with instructions and any requisite training to utilize the site. Documents shall be numbered in accordance with Shells Design Document Numbering Procedure (SAU-COM-MFPM-JA-6017-0001) which will be provided prior to award of Contract. A representative of SHELL will coordinate with CONTRACTOR to ensure proper numbering and submittal. During project development, documents shall be sent to SHELL in PDF format. At the completion of the Project, all documents shall be sent to SHELL updated to As-Built Status in PDF (as part of the Final Handover Package) and native format All documents shall be formatted to fit on A3 or A4 size paper. To support SHELLs internal assurance tracking, CONTRACTOR shall reference applicable Control ID numbers on transmittals and documents. When two Control IDs are provided, both are to be used.

9. INTERFACE MANAGEMENT

9.1. General Amongst the Project Team, Microsoft Office Outlook will be the primary means for written communication for typical day to day activities including minor clarifications, questions, and general information sharing that does not impact scope, schedule, or budget. Issues impacting scope, schedule, or budget shall be documented using the Project Change Management Process.

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Email shall not be relied upon as the only means of trying to work an issue and should only be used to the point in which an issue is identified at which point real-time interpersonal communication shall be utilized in the following order of preference:

Face to Face Meeting Telephone Call

Documenting what was discussed, outcomes, and next steps via email is acceptable and encouraged. Do not assume that people will action something in an email simply because it was sent. These action items are to be documented in the most relevant recurring meeting action item log to document and track action items.

9.2. Communication between SHELL and CONTRACTORs All direction to CONTRACTOR that may potentially lead to a Change Order or Project Change Notice must be channeled through the Project Delivery Focal. CONTRACTOR processes and forms for Requests for Information, Technical Queries, Change Orders, etc will be submitted to SHELL for approval and used to the greatest extent possible. In the event none exist, templates will be provided by SHELL for use. SHELL Document Control will be the conduit for communication between SHELL and CONTRACTOR for:

Technical Document (drawings, calculations, studies, etc) review, comment, approval

Technical Queries Requests for Information

The Project Delivery Focal will be the primary conduit for communication between SHELL and CONTRACTOR for:

Cost Updates Schedule Updates Project Change Notices

9.3. Communication between CONTRACTORs The assigned Project Delivery Focal(s) will be responsible to facilitate communications between CONTRACTORs of separate scopes, if needed. Any communication that may potentially lead to a Change Order must be channeled through the Project Delivery Focal. All formal documentation to be transmitted between CONTRACTORs of different scopes will be distributed by SHELL. It is not to be assumed by the Project Team that the individual CONTRACTORs communicate with each other or that the communications that

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scope of work

Documents

document revision

scope of work sb

contractor scope of

document status

sbcdl early production

document sierra blancacruz

revision date role

ua document control