Process Safety
Management
System Audit
Terms of Reference
Document No.
SR-65-19-01 ToR - PSM Audit
REV
DATE
DESCRIPTION
PREPARED
A
18/11/2019
Issued for comments
MSA
2
CHECKED
APPROVED
SR-65-19-01 ToR - PSM Audit
TABLE OF CONTENTS
1.0
INTRODUCTION .......................................................................................................... 4
2.0
SCOPE ........................................................................................................................ 5
3.0
OBJECTIVE .................................................................................................................. 6
4.0
AUDIT APPROACH ...................................................................................................... 7
5.0
ELEMENT WISE AUDIT APPROACH ............................................................................ 11
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SR-65-19-01 ToR - PSM Audit
1.0
INTRODUCTION
As part of continuous improvement process, Hub Power Services Limited (HPSL) has
engaged M/S Shepherd Risk to assist them in carrying out audit of Process Safety
Management system across the company head office and operations. Muhammad Saim,
Senior consultant, Process Safety will assist HPSL, HPSL will dedicate a team of Process
Safety & HSE personnel for audit.
This document gives a brief outline of Audit Terms and methodology that will be adopted.
HPSL is requested to prepare for audit accordingly.
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SR-65-19-01 ToR - PSM Audit
2.0
SCOPE
Scope of audit activities will cover HPSL Head office and 3 Plant sites:
1. Hub Power Plant.
2. Narowal energy Limited (NEL)
3. New Bong Escape Power Plant (NBE), Laraib Energy
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SR-65-19-01 ToR - PSM Audit
3.0
OBJECTIVE
Process Safety Management system is the application of management systems to
protect life of people, the environment and the property from catastrophic events
resulting from loss of control over processes.
There are three key aspects of
Process Safety Management:



Technical Integrity;
Design Integrity and
Operating Integrity
Objective of a Process Safety
Management Audit is to assess the
effectiveness of Safety Management
System and Culture at HPSL in
managing Design Integrity,
Technical Integrity and Operations
Integrity.
Process
Safety
Managem
ent
Operating
Integrity
The impact of a change in design
integrity (standard, design concept,
etc.) can take 5 to 10 years, before positive change is seen.
Example: team decides to change the design standard for a process vessel. From
now on, no block valves are allowed in the vent lines anymore. This change will
only show it benefit many years after the first vessel has been designed and put
into operation.
The impact of technical integrity can be anywhere between 1 and 5 years.
Example, the company can decide to remove all block valves after process vessels
across the whole facility. This will take a while to get budget, plant shutdowns, do
the work, etc.
The impact of operational integrity can be (almost) immediate.
Example, the company can send out Standing Order that from now on all block
valves are identified and placed in locked-open after each process vessel.
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SR-65-19-01 ToR - PSM Audit
4.0
AUDIT APPROACH
Audit will be carried out based on:



OSHA 29-CFR-1910 Audit Guidelines
AIChE, CCPS Guidelines for PSM Audit
Energy Institute PSM Audit guidelines
Since HPSL activities do not directly involve hazardous chemical process (not
directly involved with chemical, petrochemical or refining industry) hence OSHA
PSM 29.CFR.1910 is not fully applicable to HPSL operations, however, OSHA
29.CFR.1910.269 Occupational Safety and Health Standard for Electric Power
Generation, Transmission, and Distribution are directly applicable. Therefore the
audit will primarily be based on OSHA.29.CFR.1910.269.
Focus of the audit activities will be to assess whether the way organization is
currently operating is good enough in terms of Process Safety Management,
identify strengths and weaknesses and suggest actions to bridge the gaps to ensure
that organization is meeting industry best practices.
Overall audit process will be in three main steps:
1. Pre-Audit Activities
2. Audit Activities
3. Post Audit Activities
Audit activities will be based on site visit, interviews & discussions and document
reviews. Audit team will use experience and judgement in assessing the Process
Safety Performance aided by checklist and questionnaire.
In addition to focusing on Process Safety Management System Elements, the audit
team will carry out a Safety Perception Survey based on an employee & contractor
interviews and feedback.
Scope and activities of each of the three steps is detailed below:
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SR-65-19-01 ToR - PSM Audit
1 - Pre_ audit Activities
Lead Muhammad Saim - Consultant
HPSL Saleem Qureshi
Kick Off Meeting
Who: Muhammad Saim +
HPSL Core Team
Venue: HPSL Head office
Date: TBA
Estimated duration: 4 hrs.
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




Introductions & objective setting
Finalize audit Plan - Dates & Locations, allocate
resources
Prepare onsite agenda - Element wise audit plan
Review & finalize audit questionnaire
Gather background information:
o Previous Audit Report. A copy of the
previous audit report
o Action Plan. Status report on the resolution
of previous audit exceptions Regulatory
Requirements. Copies of applicable local
regulations
o Corporate Policies. Copies of applicable
corporate policies, standards, and guidelines
o Facility Policy Manuals and Plans. Copy of
tables of contents from current facility safety
manuals, emergency plans, and other
documents covering policies, procedures,
and reporting requirements
o Facility Organization. Current facility
organization chart annotated to illustrate line
and staff responsibility for all process safety
areas under review, and to identify key
contact people
o Facility Layout. Maps or diagrams to
illustrate location of different operations and
of process safety and control system
components Process
o Descriptions:
Discussion
of
process
operations, flows, chemicals and control
systems.
o Reports. Copies of selected process safety
status reports, self-audits, or other applicable
reports
o Incident Reports. Investigation reports for
recent episodic incidents
SR-65-19-01 ToR - PSM Audit
2 - Audit Activities
Corporate Level Audit
Lead: Muhammad Saim


Opening Meeting with Management & Leadership
Individual Interviews - Senior Management/Team
Leaders
 Corporate Policies
 Commitment to Process Safety & Objectives
 Top Process Safety Risks & Action Plans
 PSM Element wise assessment


Arrive at site
Opening Meeting with Site Management
o Introductions - All
o Audit Objectives & Plan - Consultant
o Site Briefing - Site Manager
Audit Activities - Team split as per element wise audit
plan
o Site visit
o Interviews
Managers,
Supervisors,
Operators, Technicians, Labor, Contractors
etc.
o Documentation & Data Review
Audit Team meeting - notes compilation
Close out meeting with site management
Support: Saleem Qureshi
Location: HPSL Head
office
Date: TBA
Estimated duration: 1 Day
Site Audit
Lead: Muhammad Saim +
Saleem Qureshi
Support: HPSL Audit
Team

Location: Plant Sites - Hub,
NLE, NBE
Date: TBA
Estimated duration: 1.5
Day each site


3- Post Audit Activities
Compilation of Audit
Findings
Participants: Audit Team
Location: HPSL Head
office
Date: TBA
Estimated duration: 4 hrs.
9



Share Element wise Audit Findings - Strengths,
Weaknesses, Observations
Submit element wise report and checklist to
consultant
Element wise rating
SR-65-19-01 ToR - PSM Audit
Audit Report
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Draft Report
HPSL Comments on Draft Report
Final Report & Presentation
SR-65-19-01 ToR - PSM Audit
5.0
ELEMENT WISE AUDIT APPROACH
Table below lists key aspects of audit against each element:
Element
Management Commitment
Management Leadership & Commitment
Policies & Principles
Integrated Organization
Structure
Line Management
Key Audit Aspects

Are the PSM Policies, Objectives and
Goals defined and communicated by
senior management & leadership to
entire organisation effectively, this
includes contractors?

Does the Leadership demonstrate
commitment to PSM Objectives & Goals
by providing adequate resources
(manpower, finance, time)?

Are PSM KPIs defined, measured and
steered at leadership levels?

Are employee benefits (e.g. annual
increment, bonus) linked to PSM KPIs?

Is the PSM organisation (e.g. HSE)
independent of site management
influences i.e. reporting directly to
senior leadership vs. reporting to site
manager?

Are competencies of core PSM / HSE
positions defined?

Are competent and experienced
personnel appointed on all approved
PSM/HSE positions?

Is there a system in place to collect and
maintain necessary Process Safety
Information?

Does a system exist to ensure that data
are accurate, reliable, and up-to-date,
and that process safety information is
available to all personnel who need to
have access to it?
Accountability & Responsibility
Goals, Objectives, & Plans
Technology
Safety Personnel
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Process Safety Information
SR-65-19-01 ToR - PSM Audit

Is there a program in place and
executed for Process Hazard & risk
Analysis?

Are the risk tolerability criteria defined?
Are all risks within ALARP or acceptable
limits?

Are applicable PHRA tools and
techniques clearly defined and
procedures and mythologies
documented?

Are competencies for leading and
participating in PHRA techniques
defined and developed within
organization?

Is there a plan in place for periodic
execution of PHRAs and is being
followed?

Is there a system in place for monitoring
timely implementation of
recommendations from PHRAs?

How are delays and deferments in
implementation of PHRA
recommendations handled, does the
management declare it an incident (API
754)

Is there are system in place for periodic
review and update of operating
procedures?

Are all operating procedure current and
updated? Reflecting latest PSI and
PHRAs?

Are operating procedures covering all
modes of operation, including normal,
shutdown & startup and emergency?
Process Hazard & Risk Analysis
Operating Procedures &
Practices
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SR-65-19-01 ToR - PSM Audit

Are safe upper and lower operating
limits defined?

Is there a system in place for managing
changes - facility, technology and
Personnel?

Does the Change Management
procedure define type of changes
covered under the subject?

Does the change management
procedure define the need for PHRAs as
applicable to the change?
Management of Change
Pre Start-up Safety Review
Is there a documented procedure in place
for Pre-Start-up Safety Reviews?
Has the company defined international
standards, guidelines, and industry practices
for Design, Fabrication, Procurement and
installation of critical equipment?
Facilities
Has the company defined inspection &
testing requirements for fabrication,
installation and maintenance?
Are procedures for inspection and
maintenance well defined?
Electrical & Mechanical Integrity
Has the company adopted RBI, RCM based
maintenance plans?
Are Safety Critical Elements and Activities
listed and performance standards included,
proof test intervals, and proof test
procedures defined, documented and
followed?
Are maintenance and inspection personnel
well trained/certified in relevant tasks?
Is there any overdue maintenance of any
Safety Critical Equipment?
Quality Assurance
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Are quality assurance requirements for
SR-65-19-01 ToR - PSM Audit
design, procurement, fabrication and
installation defined and documented?
How are process safety training objectives
set?
At what level of the organization is this
done?
How frequently is this assessment made,
and by whom?
At what level of the organization does this
training take place?
Training & Performance
Who is assigned primary responsibility for
the training?
How is input provided from other groups to
ensure that integration of a specific subject
into the overall training program will be
correct?
After development of the training materials,
who has the responsibility and authority for
validating the completeness and accuracy of
the materials?
Has the validation actually taken place?
Are training records maintained? Available?
Are contractors involved in every aspect of
PSM Program and necessary trainings
given?
Contractors
Are contractor workers competency
defined, and assessed?
Is contractor work force aware of their
contribution, and responsibilities towards
PSM?
Incident Investigation
Is there a procedure/guideline in place for
incident reporting and investigation?
Are there any trained incident investigators
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SR-65-19-01 ToR - PSM Audit
in the organisation?
Are lessons from incident investigations
shared with all including employees and
contractors?
Are comprehensive Emergency Response
Plans in place?
Is ER organisation defined and known to all
including employees, contractors and govt
agencies?
Emergency Planning &
Response
Area ER plans based on scenarios identified
and assessed in PHRA studies?
Are adequate resources required to execute
ER plan, should an undesirable event
occurs, available?
How are govt and external agencies
involved in ER planning?
Are trainings, testing and drills on ER plan
conducted regularly?
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SR-65-19-01 ToR - PSM Audit
Annexure I
PSM Audit Questionnaire
(will be given later)
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SR-65-19-01 ToR - PSM Audit
Annexure II
Safety Perception Audit Check list
(will be given later)
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SR-65-19-01 ToR - PSM Audit