Engineering Procedure
SAEP-1151
23 October 2017
Inspection Requirements for Contractor Procured Materials and Equipment
Document Responsibility: Project Quality Standards Committee
Contents
1
Scope ................................................................ 2
2
Conflicts and Deviations ................................... 2
3
Applicable Documents ...................................... 2
4
Definitions and Acronyms ................................. 3
5
Procurement Risk Management........................ 4
6
Contractor Purchase Requisition ...................... 5
7
Inspection and Test Plan .................................. 6
8
Special SA-175 Forms ...................................... 7
9
Minimum Inspection Levels ............................... 7
10
Responsibilities ................................................. 8
11
Technical Support ............................................. 9
Revision Summary .................................................... 9
Appendix I - Procurement Risk
Evaluation Guidelines ......................... 10
Appendix II - Procurement Risk
Mitigation Guidelines........................... 11
Previous Issue: 30 January 2017
Next Planned Update: 1 November 2020
Page 1 of 11
Contact: Megren, Abdulaziz A. (megraa0a) on phone +966-13-8804510
©Saudi Aramco 2017. All rights reserved.
Document Responsibility: Project Quality Standards Committee
Issue Date: 1 November 2017
Next Planned Update: 1 November 2020
1
SAEP-1151
Inspection Requirements for Contractor
Procured Materials and Equipment
Scope
This document, together with the purchase order and appropriate project specifications
define the minimum mandatory inspection requirements for project contractor materials
and equipment.
Commentary Note:
As per the Procurement Manual 3.1.2, Short-form and Mid-form Contracts are also within
the scope of this procedure.
2
Conflicts and Deviations
Any conflicts between this document and other applicable Mandatory Saudi Aramco
Engineering Requirements (MSAERs) shall be addressed to the EK&RD Coordinator.
Any deviation from the requirements herein shall follow internal company procedure
SAEP-302.
3
Applicable Documents
All references mentioned below shall be considered part of this document to the extent
specified herein and shall be of the latest issue (including all revisions, addenda, and
supplements) unless stated otherwise.
3.1
Saudi Aramco References
Saudi Aramco Engineering Procedures
SAEP-71
Portfolio Execution Planning (PXP)
SAEP-302
Instructions for Obtaining a Waiver of a Mandatory
Saudi Aramco Engineering Requirements
SAEP-1150
Inspection Coverage on Projects
Saudi Aramco Inspection Requirements
175-324400
Manufacture of Skid-Mounted Process Packaged
Equipment Units
Other Document
Schedule Q
Quality Requirements
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Document Responsibility: Project Quality Standards Committee
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Next Planned Update: 1 November 2020
3.2
SAEP-1151
Inspection Requirements for Contractor
Procured Materials and Equipment
Industry Codes and Standards
International Organization for Standardization
4
ISO 9001
Quality Management Systems - Requirements
ISO 10005
Quality Management Systems - Guidelines for
Quality Plans
ISO 19001
Guidelines for Quality Management Systems
Auditing
Definitions and Acronyms
Quality System: Organizational structure, procedures, and processes are resources
needed to implement quality management.
Mandatory Hold Point: An inspection point, defined in an appropriate document,
beyond which an activity must not proceed without the approval of a designated
organization or authority.
Witness Point: An inspection point, defined in an appropriate document, beyond
which an activity can proceed after notifying the designated organization or authority.
Review Point: A review point, defined in an appropriate document, is the point at
which a work activity cannot proceed without first ensuring the review and approval of
applicable documents or personnel qualifications by a designated organization or
authority.
Quality Assurance (QA): All the planned and systematic activities implemented
within the quality system, and demonstrated as needed, to provide adequate confidence
that an entity will fulfill requirements for quality.
Quality Control (QC): The operational techniques and activities that are used to fulfill
requirements for quality.
Quality Control Procedure (QCP): A QCP is a documented procedure detailing the
processes necessary to complete a specific work activity.
PIM: Pre-inspection Meeting
Type-A & Type-B Projects: As defined in SAEP-71.
Inspection and Test Plan (ITP): An ITP is a document based on the detailed
manufacturing, fabrication and, construction program and identifies each process
description. The ITP will set out related sequence of activities to be inspected,
examined, and tested, and includes the following:
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Document Responsibility: Project Quality Standards Committee
Issue Date: 1 November 2017
Next Planned Update: 1 November 2020
SAEP-1151
Inspection Requirements for Contractor
Procured Materials and Equipment
1)
Lists the relevant approved procedures for a particular material, component,
assembly, and/or, type of work.
2)
Identification of requirements for documents and acceptance criteria as applicable.
3)
Roles and responsibilities of all involved parties.
RIO: Responsible Inspection Office
Project Quality Manager (PQM): The senior Inspection Representative responsible
for coordinating all inspection requirements on behalf of the Inspection Department
with PM throughout all project phases.
SAIR: Saudi Aramco Inspection Representative
VID: Saudi Aramco Vendor Inspection Division
NDT: Non-destructive Testing
Procurement Risk Register: A list of contractor planned and actual POs with
assigned level of risk (i.e., critical, high, moderate, or low).
5
Procurement Risk Management
Limited to Type-A and Type-B projects:
5.1
Contractor within one month from developing the Material List shall develop the
Procurement Risk Register and submit it to company for review and approval.
5.2
Procurement Risk Register shall be evaluated according to weighed factors as
tabulated in Table 1 and using scores as per Appendix I.
5.3
SAIR shall use the “Procurement Risk Assessment Tool”, which can be requested
from quality monitoring unit supervisor, to evaluate and maintain the risk levels.
5.4
Contractor shall closely monitor and assess critical- and high-risk PO’s, to
ensure quality and minimize rework. The listing shall be reviewed monthly to
update risk assignments for new and existing PO’s, based on technical alerts,
major lessons learned, and deteriorating manufacturer performance.
5.5
As minimum, the risk mitigation guidelines described in Appendix II shall be
applied.
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Document Responsibility: Project Quality Standards Committee
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SAEP-1151
Inspection Requirements for Contractor
Procured Materials and Equipment
Table 1 - Contractor POs Risk Assessment Criteria
Criteria
Probability
Impact
Evaluation Source
Weight (%)
Failure Frequency
QMIS, SAP-QM and/or SME
20
Manufacturing Complexity
SME
20
Vendor/ Manufacturer Performance (VQI)
SME
15
Operational Conditions
SME
20
MSAERs availability
SME, RSA
15
Preservation and handling
Manufacturer
10
Cost and Schedule
Project Management SME
50
Quality
Proponent’s SME
50
5.6
Contractor shall carry out focused technical and quality assessments at specified
PO progress as per assigned risk in accordance with Table 2.
5.7
Contractor shall submit the focused assessment report to company including
found quality and technical issues, and required corrective actions.
Table 2 - Frequency of Technical and Quality Focused Assessments
PO Progress
Risk
Critical
30%
60%
90%
X
X
X
X
X
High
Medium
X
Bulk Material
6
Prior to first shipment.
Contractor Purchase Requisition
6.1
Purchase requisition originators shall identify the applicable fabrication and
inspection requirements in addition to the applicable 9COM. The minimum
inspection requirements stated in approved requisition shall be reflected in
purchase orders.
6.2
Purchase requisition originators may also modify the content of a coded SA-175
form for certain purchase orders provided the following procedure is followed:
6.2.1
If the modification is to delete or modify an inspection activity specified
in Mandatory Saudi Aramco Engineering Requirements, a waiver shall
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SAEP-1151
Inspection Requirements for Contractor
Procured Materials and Equipment
be duly obtained as per SAEP-302 against applicable standards before
altering the coded SA-175 form.
6.2.2
If the modification is to delete or add an inspection activity not explicitly
stated in Mandatory Saudi Aramco Engineering Requirements such as
witnessed tests, certification requirements etc., which are indicated in the
coded SA-175 form, concurrence shall be obtained from the Saudi
Aramco inspection representative (SAIR) before altering the SA-175
form.
Modified SA-175 forms will automatically become “175-SPECIAL”
forms. See Section 8 for further instructions on 175-SPECIAL forms.
6.3
7
When requested, after P.O. award and prior to sub-P.O. placements contractor
shall submit sub-vendor list for company review that shall include as a minimum
the following: material description, 9COM, approved sub-vendor (Name and
ID), inspection level and material specification.
Inspection and Test Plan
7.1
The vendor and/or sub-vendors shall prepare detailed ITP’s for all assigned
equipment and materials in accordance with all relevant Saudi Aramco
inspection forms (SA-175 forms), Schedule Q, and purchase orders.
7.2
ITP shall provide:
7.2.1
Detailed inspection activities and the required tests which include, as
minimum, inspection hold, witness, review points, and inspection
frequency.
7.2.2
Sampling plan criteria for inspectable bulk material which shall be
determined based on company standards and international code.
7.2.3
Clearly defined roles and responsibilities for each inspection activity.
7.3
Sampling plan availability does not relieve the vendor of the responsibility to
ensure compliance with company requirements.
7.4
SAIR reserves the right to increase inspection activities and sampling plan criteria
in coordination with Subject Matter Expert (SME) based on the criticality of the
purchase orders and past performance of selected manufacturers.
7.5
When required by company standard and/or project specifications, vendor
and/or sub-vendor shall submit for company review and approval all necessary
quality control procedures such as welding, NDT, heat treatment, and the
required related procedures for that specific purchase order.
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8
9
SAEP-1151
Inspection Requirements for Contractor
Procured Materials and Equipment
Special SA-175 Forms
8.1
Some inspectable materials do not have coded SA-175 forms linked to them.
When these materials are procured, the purchase requisition originators shall
specify source inspection requirements for materials, by filling in the blank
special SA-175 form.
8.2
The contractor is responsible to develop and maintain full document control of
issued special SA-175 forms during a project in term of numbering and
identification, approval, revisions and records preservation.
8.3
The PQM and/or SAIR is responsible to review and approve contractor
generated special SA-175 forms.
8.4
SA-175 form provides sufficient space and flexibility to accommodate all types
of equipment. However, it is not normally designed to cover more than one kind
of equipment.
8.5
For packaged and skid mounted equipment, separate SA-175 forms are required
for each type of inspectable equipment in addition to 175-324400, unless
otherwise directed by the SAIR to cover the inspection and testing of the
assembled packaged and skid mounted equipment.
Minimum Inspection Levels
9.1
Inspection levels shall be assigned on project contractor’s materials and
equipment to specify the minimum amount of inspection coverage deemed
necessary by Saudi Aramco to ensure that a product or service conforms to
specifications at a specific supplier's and/or sub-supplier's factory or fabrication
site.
9.2
The following system of coding the level of planned inspections shall be used to
define the inspection requirements:
Level 0:
Documentation requirements only as specified in applicable SA-175
form; no vendor inspection required.
Level 1:
Only final inspection including release for shipment is required prior
to shipping.
Level 2:
Includes pre-inspection meetings, one or more unspecified “in
progress” surveillance visit/s, all witness and hold points, final
inspection, and release for shipment.
Level 3:
Includes pre-inspection meetings, one or more unspecified “in
progress” surveillance visits, all witness and hold points, final
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SAEP-1151
Inspection Requirements for Contractor
Procured Materials and Equipment
inspection, and release for shipment. Inspections shall be on a
regular basis (daily, weekly or bi-weekly).
Level 4:
Resident inspector continually monitoring the work.
All inspectable material covered under the inspection levels as defined above,
shall be procured from Saudi Aramco approved manufacturers.
10
9.3
Minimum inspection levels by project contractor for procured materials and
equipment shall be as per the company provided list of inspection levels
extracted from SAP per 9COM at the project cut-off date.
9.4
VID provides quality monitoring and inspection support for projects in
accordance with approved ITP. SAIR will determine which purchase orders and
vendor activities to be monitored based on guidelines in Appendix II.
9.5
Inspection levels might be elevated or lowered by SAIR on case by case basis,
based on criticality of procured materials, performance of selected manufacturer
and qualification of contractor’s inspector, etc.
9.6
When vendor does not meet the specified performance requirements in the
purchase order, or company has placed the vendor on-hold after the company
has issued a “No Objection” letter to contractor, contractor shall increase the
inspection level to the next highest level for the purchase order without
additional cost to company, subject to company approval.
9.7
In case of materials/equipment not listed in the list as described in paragraph 9.3,
the SAIR will determine the appropriate inspection level.
9.8
Contractor shall not release material with punch list items unless approval is
obtained from company representative.
Responsibilities
10.1
SAIR and/or PQM is responsible to verify the assignment of appropriate level
of inspection. He is also responsible to determine the level of inspection for
non-listed materials/ equipment.
10.2
Contractor is required to provide enough inspection coverage for Procured
Materials, perform the required inspection, track material inspection status and
inspection notifications and highlight any deficiencies to company in timely
manner.
10.3
Contractor is responsible to propose the proper level of inspection in accordance
with this procedure and/or other contractual documents.
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SAEP-1151
Inspection Requirements for Contractor
Procured Materials and Equipment
10.4
RIOs are responsible to provide monitoring inspection services when requested
by the SAIR.
10.5
VID Management will insure the timely review and issuance of the revised
version of this procedure.
10.6
SAIR is responsible to escalating to SAIR’s management any repetitive major
observations from the same vendor for any further actions.
10.7
SAPMT is responsible to provide contractor a list of all inspectable materials
with their respective inspection levels, extracted from SAP, as a part of IFB
(Issued for Bid) package.
Technical Support
For technical support or enquiry regarding this procedure, contact current VID/QMU
Supervisor or VID Superintendent.
Revision Summary
18 November 2012
30 January 2017
1 November 2017
New Saudi Aramco Engineering Procedure.
Editorial revision to transfer document responsibility from Inspection Engineering to Project
Quality Standards Committee and other changes.
Major revision for two main reasons; (1) to update the listed IR Codes and associated
equipment descriptions to reflect the current selection of inspectable materials, and
(2) to make inspection levels more dynamic by obtaining inspection levels per the project
cut-off date from SAP. This revision will therefore no longer reflect inspection levels.
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SAEP-1151
Inspection Requirements for Contractor Procured Materials and Equipment
Appendix I - Procurement Risk Evaluation Guidelines
Score
Repeated
Issue
0
No previous
EDR or NCR
1
2
Equal to 3 -5
EDRs or NCRs
3
4
Higher than 6
5
Manufacturing
Complexity
Vendor
Performance
Operational
Conditions
Preservation and
Handling Requirements
N/A
N/A
N/A
N/A
Final inspection or
none critical review
Approved vendor with
VQI more than 85%
Low pressure, temp.,
and voltage, none
sour, utility services
Normal preservation and
handling, e.g., only box
packing.
In process inspection,
no special processes
review.
Approved vendor with
VQI between 85-75%
Approved vendor with
VQI between 75-70%
First Time purchased
engineered equipment.
New vendor or with
VQI between 70-65%
Licensed equipment or
with special design
conditions and
meteorology.
On-hold or with VQI
less than 65%
Medium pressure,
temp., or voltage,
(non-sour or critical)
High pressure, temp.,
and voltage. Sour,
cryogenic, cyclic or
other considered
safety hazardous
Normal preservation and
handling, e.g., shade.
Controlled Environment
Special preservation such
as N2, Oil, VCA
Special preservation such
as N2, Oil, VCA, and
special handling during
transportation.
Material MSAERs
Availability
N/A
Inspection and MASERs
requirements are all
available.
Special 175 form
required.
MSAERs are not
available, and SP 175
form is required.
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SAEP-1151
Inspection Requirements for Contractor Procured Materials and Equipment
Appendix II - Procurement Risk Mitigation Guidelines
Purchase Order Focused Assessment
Risk Level
Contractor Company
Inspector Monitoring
Senior
Inspector
Critical



High



Medium


Low

Inspection
PMT
Proponent
30%
60%
90%
30%
60%
90%










30%
60%

Technical SME
90%
30%
60%
90%




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