You are on page 1of 85

ABU DHABI NATIONAL OIL COMPANY

HEALTH SAFETY AND ENVIRONMENTAL MANAGEMENT MANUAL OF CODES OF PRACTICE VOLUME 1 : HSE ADMINISTRATION

GUIDELINE ON MANAGEMENT OF CONTRACTOR HSE


ADNOC-COPV1-04

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 2 of 85

RECORD OF REVISION Revision No. Date Section/Page Reason

Copyright The copyright and all other rights of a like nature in this document are vested in Abu Dhabi National Oil Company (ADNOC), Abu Dhabi, United Arab Emirates. This document is issued as part of the Manual of HSE Codes of Practice (the Manual) and as guidance to ADNOC, ADNOC Group Companies and independent operators engaged in the Abu Dhabi oil & gas industries. Any of these parties may give copies of the entire Manual or selected parts thereof to their contractors implementing HSE standards in order to qualify for award of contracts or for the execution of awarded contracts. Such copies should carry a statement that they are reproduced by permission of ADNOC, and an explanatory note on the manner in which the Manual is to be used. Disclaimer No liability whatsoever in contract, tort or otherwise is accepted by ADNOC or any of its Group Companies, their respective shareholders, directors, officers and employees whether or not involved in the preparation of the Manual for any consequences whatsoever resulting directly or indirectly from reliance on or from the use of the Manual or for any error or omission therein even if such error or omission is caused by a failure to exercise reasonable care.

All administrative queries should be directed to the Manual of HSE Codes of Practice Administrator in:

Environment Health & Safety Division, Exploration & Production Directorate, Abu Dhabi National Oil Company, P.O. Box : 898, Abu Dhabi, United Arab Emirates. Telephone : (9712) 6023782 Fax: (9712) 6668089 Internet site: www.adnoc.com E-mail:hse@adnoc.com

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 3

CONTENTS Page I. PURPOSE............................................................................................................ 5 II. DEFINITIONS....................................................................................................... 5 III. EXISTING LAWS ................................................................................................. 7 1. INTRODUCTION.................................................................................................. 8 1.1 Objectives ................................................................................................... 9 1.2 Background ................................................................................................ 9 1.3 Scope ........................................................................................................ 10 2. OVERVIEW ........................................................................................................ 11 2.1 Contract Phases and HSE Planning ....................................................... 11 2.2 Planning for HSE: Timing and scope ..................................................... 11 2.4 Company and Contractor HSEMS........................................................... 15 2.5 Joint HSEMS and COMAH Report Preparation...................................... 16 3. PLANNING AND INVITATION TO TENDER ..................................................... 18 3.1 Objectives ................................................................................................. 18 3.2 Outline Scope of Work or Services......................................................... 18 3.3 Contract Scope, Schedule and Strategy ................................................ 21 3.4 Contract HSE Assessment ...................................................................... 22 3.5 Contract HSE Specification ..................................................................... 23 3.6 Contractor Prequalification ..................................................................... 25 4. THE TENDER PERIOD...................................................................................... 27 4.1 Objectives ................................................................................................. 27 4.2 Contractor's HSE Plan ............................................................................. 27 4.3 HSE Costs ................................................................................................. 28 4.4 Incentive Schemes for HSE ..................................................................... 28 5. EVALUATION AND CONTRACT AWARD........................................................ 30 5.1 Objectives ................................................................................................. 30 5.2 Evaluation ................................................................................................. 30 6. MOBILISATION ................................................................................................. 31 6.1 Objectives ................................................................................................. 31 6.2 Kick-off Meetings ..................................................................................... 31 6.3 Mobilisation .............................................................................................. 34 6.4 Pre-execution Audit ................................................................................. 34 7. EXECUTION ...................................................................................................... 35 7.1 Objectives ................................................................................................. 35 7.2 Supervision............................................................................................... 35 7.3 Competence Assurance .......................................................................... 36 7.4 Inspection and HSE Auditing/Reviews................................................... 37 8. DEMOBILISATION ............................................................................................ 39 9. CLOSE-OUT ...................................................................................................... 40 10. REFERENCES................................................................................................... 41 APPENDIX I: CONTRACTOR HSE PREQUALIFICATION .................................... 42

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 4

APPENDIX II: PREQUALIFICATION HSE EVALUATION GUIDELINE (POINTS SYSTEM) ........................................................................................... 48 APPENDIX III: HSE RESPONSIBILITIES FOR GROUP COMPANY AND CONTRACTOR KEY PERSONNEL .................................................. 53 APPENDIX IV: HSE PLAN GUIDELINE FOR MAJOR CONTRACTS .................. 56 APPENDIX V. APPENDIX VI HSE PLAN GUIDELINE FOR SMALL CONTRACTS ................ 75 CONTRACT EXECUTION HSE AUDIT GUIDELINES ............... 80

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 5

I.

PURPOSE
The purpose of these Guidelines is to: define the minimum HSE objectives to be met at each stage of a contract develop a strategy for proactive management of Contractor HSE highlight the benefit of effective proactive approaches, particularly prior to tendering and mobilisation describe a planned approach to Management of Contractor HSE that will ensure a continuing improvement in HSE performance for all contractor activities describe the role and responsibilities of key personnel in contractor HSE management.

This document is targeted principally at Contract Holders and Group Company and contractor personnel tasked with planning HSE in contracts, with tender preparation, evaluation, award and subsequent contractor management. The approach described in this document is one of many possible ways of dealing with management of contractor HSE. The approach and guidelines are not mandatory and Group Companies may follow different methods, provided that they can demonstrate that their chosen approach is at least as effective as that described in this guideline.

II.

DEFINITIONS
A glossary of commonly used terms in HSE is given in the ADNOC CoP document HSE Definitions & Abbreviations [Ref. 1]. Any additional terms used specifically in the context of this document are defined below. Contract A formal business agreement detailing the terms and conditions for the supply of products or the provision of services. Contractor A firm which has entered into a legal contract to supply services or material to Company (Group Company). (The term is also frequently applied to suppliers who are available to provide services but are not currently in a contractual relationship with Company [Group Company]). Contracts Board A Committee of Senior Company Staff which ensures the implementation of the Company's contracting principles and objectives.

[1] ADNOC Manual of Codes of Practice: Guideline on HSE Definitions & Abbreviations, ADNOC-COPV1-05

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 6

Contract Holder Person within the Contract Sponsor's department who is responsible for managing all aspects of the Contract as regards the Contractor and all Company (Group Company) departments concerned. Contract Manager The person named in the contract to represent the Contractor in respect of the contract and to be responsible for the management of the contract. Contractor Representative The person appointed in writing by the Contract Manager to supervise the execution of the contract activities. Contractor Site Representative The person appointed in writing by the Contract Manager to assist the Contractor Representative in supervising the execution of the contract activities on a given site. Contract Sponsor The department, section or function that has budget and management authority to execute the Contract. Contractor's HSE Plan A contractor's proposal as to how he intends to implement the HSE requirements as outlined initially by the Group Company. For the selected contractor, this becomes the plan on which the HSE terms in the contract are based. HSE Plan A formal document showing how it is intended to manage the hazards determined. It is usually drafted initially by the Group Company. It should be recognised that in many situations, particularly for larger contracts, this HSE Plan will effectively form a significant part of the COMAH Report Group Company HSE Adviser An HSE specialist responsible for providing line management with current HSE guidance on technical and human matters, including where appropriate, advice on techniques, equipment, HSE auditing, training, incident investigation, emergency procedures; the Adviser's responsibilities do not include HSE performance in the line. Group Company Representative The person appointed in writing by the Contract Holder to supervise the execution of the contract activities. Group Company Site Representative The person appointed in writing by the Contract Holder to assist the Group Company Representative in supervising the execution of the contract activities on a given site.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 7

Procurement Term used to cover the whole cycle of activities which need to be performed to acquire and deliver to a user an item of material or a service, from conception of the need through design, purchasing, storage and delivery to ultimate disposal. Scope of work The description in established parameters of the work required to achieve the objectives of a project or activity. Tender Board Synonym for Contracts Board, but with more emphasis on tendering as the process to achieve contracts.

III.

EXISTING LAWS
Relevant UAE legislation applicable to the subject of this Guideline is described in the ADNOC CoP document HSE Administration Systems [Ref. 2].

[2] ADNOC Manual of Codes of Practice: Code of Practice on HSE Administration Systems, ADNOC-COPV1-01.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 8

1.

INTRODUCTION
This document identifies and describes the activities associated with the management of contractor HSE by ADNOC Group Companies within the formal framework of a contract, both prior to and after award. The specific objectives and mandatory requirements for each phase are stated, and thereafter guidelines are provided as an aid to achieving the objectives. The appendices provide illustrative examples of guidelines for the principal features of each phase. The extent to which these guidelines are applied will be influenced by the scale and HSE criticality of the contracts. This document sets out guidance on how to achieve the same or higher HSE standards as those required by ADNOC Group Companies for their own operations. It is based on a planned approach with attention being paid to the early project phases. This is to provide early awareness of the HSE issues that need to be included by the Contract Holder in the tender documents. It is targeted principally at Contract Holders and personnel tasked with planning HSE in contracts, with tender preparation, evaluation and subsequent contractor management. It contains the following chapters: 1. Introduction 2. Overview A basic introduction to the objectives, background and scope of coverage. An overall picture of the sequence of phases involved, planning the work, the HSE issues involved and the links with HSE MS. The main steps necessary in the Group Company's definition of HSE requirements in the contract and the prequalification of contractors. The HSE proposals expected in the contractor's bid in response to the tender documents and the clarification of these proposals. The assessment of the contractor's HSE Plan against the required criteria. The contract kick-off, assessment of the contractor's HSE performance during the mobilisation phase and pre-execution audit. HSE monitoring and supervision of the contractor during contract execution. HSE monitoring demobilisation. of the contractor during

3. Planning and Invitation to Tender 4. Tender period

5. Bid evaluation and contract award 6. Mobilisation

7. Execution 8. Demobilisation 9. Close-Out

The reporting and feedback of Group Company and contractor HSE performance.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 9

1.1

Objectives The overall objectives of this document are: Ensure that contractors meet or exceed ADNOC HSE standards Adherence to hazards and effects management process All hazards to the health and safety of the contractor's personnel, ADNOC and Group Company staff and the public, to the environment and to the assets of the contractor, ADNOC, Group Companies or public should be: identified, assessed systematically and eliminated where possible controlled through formal procedures and planning methods covered by contingency plans in place to deal with identified consequences of potential loss of control. Mutual HSE awareness Both the contractor and the Contract Holder should be mutually aware of both parties' minimum obligations to manage HSE and these obligations should be within mutually agreed contractual terms. Means to monitor the contract HSE management The means to monitor the contract HSE management system (HSEMS) should be mutually defined, understood, accepted and agreed by both parties as contractually binding. Equal attention to H, S and E Controls in place for hazards and effects management The controls necessary for the management of hazards and effects should be in place and working. Where they are not, this should be speedily remedied or in extreme cases, work should be stopped. Ensure clarity between Contract Holder and Contractor regarding responsibilities

1.2

Background A large part of ADNOC Group activities depend on contractors to carry out a wide variety of works and the majority of these are carried out in and around workplaces of relatively high risk. Efforts to achieve the required HSE standards must often overcome problems of language, culture, inhospitable environments whilst meeting the UAE and National Laws. Analysis of contractor HSE performance in the ADNOC Group shows improvement, however, of particular concern is the rate of serious incidents in road transport activities. The past approach to management of contractor HSE has tended to concentrate on monitoring/control of HSE activity after contract award, where reactive measures in response to incidents and inspections predominated.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 10

This document provides guidelines for a more proactive approach with 'upfront' HSE management by means of more focused attention during the initial project phases, i.e. during tender evaluation and mobilisation as an immediate objective and even earlier phases as an objective for the future. This shift of approach is represented in Figure 1.1. Also, it is anticipated that ADNOC Group of Companies will undertake 'Partnering' arrangements with contractors in which shared common objectives are to be met. These contracts usually have a long-term nature which emphasises the need for early identification of clear HSE objectives from the onset and inclusion of these in the contract.

Figure 1.1 1.3 Scope

HSE activity phasing for contracts

This document covers health, safety and environmental issues for all types and forms of contract services within the ADNOC Group of Companies. The extent to which these guidelines are applicable depends on the level of HSE risk that is incumbent to the contract services under consideration. In turn, this will influence the extent to which the full details presented in Chapters 3 through 9 of these guidelines may need to be applied.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 11

2.
2.1

OVERVIEW
Contract Phases and HSE Planning The influence and inclusion of HSE issues in the preparation of tender and contract documents and the subsequent HSE management of a contractor can be described within the context of an identifiable series of phases: planning and invitation to tender tender period bid evaluation and contract award mobilisation execution demobilisation close-out.

The chapters of this document follow this chronological sequence of events in contractor management. Each of the phases and the corresponding key HSE contract activities are shown in summary in Figure 2.1 and expanded in detail in subsequent chapters. The detailed guidance in the appendices follows the standard set of headings for HSE management with a further heading to cover those general issues of the work activities themselves. 2.2 Planning for HSE: Timing and scope The main HSE activities of each phase together with the way in which the responsibilities for these activities are divided between the Group Company and the contractor are shown in Table 2.1. The emphasis on HSE considerations in the early phases is for the following reasons: to improve contract HSE definition and awareness to provide early identification of HSE issues for inclusion in the tender documents to provide a framework before contract award for continued performance of HSE to agreed standards in subsequent execution to (re)confirm that contractors can fulfil HSE obligations, partly based on past HSE performance.

There are two main points to be considered in determining the application of HSE issues: the extent of the HSE coverage required the importance of specific HSE issues.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 12

Definition

Establish contract scope / schedule / strategy

Prequalify contractors Assessment of each contract

PLANNING AND INITIATION TO TENDER

Finalise tender document

Contractor prepares HSE plan

TENDER PERIOD

Review tender

EVALUATION AND CONTRACT AWARD

CONTRACT AWARD

Confirm HSE plan

Hold local kick-off meeting

MOBILISATION

Monitor HSE plan implementation and performance

EXECUTION

Maintain same level of vigilance as during execution Feedback to Register of Approved Contractors for prequalification of contractors

DE-MOBILISATION

HSE close out Report

CLOSE-OUT

Figure 2.1

Management of Contractor HSE: overall flowchart

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table 2.1 Phase Planning and Invitation to tender

Version 1 June, 2004 Page 13

Management of Contractor HSE: key targets and Group Company and contractor activities Target Major hazards identified with assurance that they can be managed Confirmation of major hazards with outline targets criteria and methods for control Confirmation that prequalified contractors can achieve targets Review of previous HSE record of contractors HSE tender evaluation criteria specified and agreed with Tender Board Group Company Qualitative HSE assessment of the work HSE sensitivities Hazard identification /quantification Health risk assessment Environmental impact assessment HSE policies and approach Group Company/contractor dialogue Contractor Group Company/contractor dialogue Respond to prequalification Discuss HSE responsibilities and staffing

Tender period

Contractor preparation of HSE Plan in accordance with Group Company criteria/input Confirmation that contractor HSE Plan will meet Group Company criteria Agreement with contractor on methods to be used, performance measurement criteria and audit/review strategy

Respond to clarification requests Meetings and site visits Evaluate bids Clarifications Meetings Finalise contractor's HSE Plan

Evaluation and contract award

Prepare contract HSE Plan Clarification requests Meetings and site visits Respond to clarifications Meetings

Mobilisation

Confirmation that contractor's HSE Plan has achieved preexecution targets

Kick-off meeting Confirm contractor's HSE Plan activities Supervision Pre-execution audit

Kick-off meeting Confirm contractor's HSE Plan activities Supervision Induction Training Meetings Inspection Pre-execution status achievement

Contd next page

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Phase Execution Target Assurance and verification that contractor systems are performing in line with contractor's HSE Plan Milestone reviews Group Company Supervision Meetings Promotion of HSE issues HSE performance review Investigation of incidents Auditing

Version 1 June, 2004 Page 14

Contractor Supervision Inspection Induction Training/Drills Meetings HSE performance review Investigation of incidents Auditing Correction of defects

Demobilisati on Close-Out

Management of final activities Analysis and feedback of Group Company and Contractor HSE performance

Supervision Close-out report Feedback for future contract HSE Plans/clauses

Supervision Close-out report and feedback (to own management)

The material presented in the remaining chapters of this document is sufficiently extensive and detailed to cover large contracts, for example, major engineering/procurement/construction (EPC) contracts, which involve significant elements of all the phases outlined above in table 2.1. The appendices similarly contain further details that could be relevant to such contracts and, in some circumstances all of the items listed may need to be considered. For small contracts, and those where the extent of planning work is much less, the need for such a comprehensive coverage will be correspondingly reduced. However, even for small or short duration contracts, HSE planning must not be ignored or treated superficially. In such cases, the work is likely to include the use of basic practices (e.g. scaffolding, welding, excavating, erecting formwork, etc) and the contractor should be able to demonstrate good general HSE management in each of these basic practices. In addition, the contractor should be able to understand and carry out hazard assessment when these practices are put together in different combinations, particularly in association with the hazards of the workplace (e.g. working in confined spaces, over water, etc) and live plant (e.g. presence of H2S, isolating electrical systems, etc). Preparations for contracts, large or small, must include the same systematic process of hazard identification, assessment, control and recovery, together with the evidence that a system is in place to manage these hazards. In a major project this HSE Plan will be a comprehensive document. In the other extreme, e.g. for the one-man contract undertaking a simple repetitive task, a short pro-forma completed to show that the hazards are recognised and understood is likely to be adequate.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 15

2.4

Company and Contractor HSEMS A typical Group Company HSEMS will describe the elements of the Group Company's management system as they apply to HSE (Part 1) and the detailed breakdown of business processes into the HSE-critical activities (Part 2). For an operation-specific situation, these two parts are translated into a demonstration of the HSEMS in action (as part of the COMAH report). Refer to ADNOC CoP document HSEIA Requirements [Ref. 3]. Where such operations require contracted work or services, the COMAH report must show how the Group Company manages contractor HSE and how the contractor achieves HSE management of his own workforce and his subcontractors. Major contractors providing services to Group Companies must be able to demonstrate that they already have an HSEMS and are prepared to contribute to the COMAH report. Whilst it is not intended that their HSEMS should be identical to that of the Group Company, it should exhibit the same degree of application and assurance of safe operations. A contractor familiar with the guidelines as provided in the ADNOC Group Guideline HSE Management System Guidelines [Ref. 4] and who uses these as the basis for his own HSEMS should be able to align immediately with this requirement. Smaller (minor) contractors, who may not have a formalised HSEMS, must still have a basic understanding of managing HSE in their operations and be prepared to provide a simple but effective management system. Service contracts are often used as a means of executing work. Initially such contracts often have no defined scope beyond a general description of the services, skills, plant, etc that the contractor must be able to provide. However, the ability of the contractor to mange HSE on a job-by-job basis is an essential requirement. For example, he should be able to make hazard assessments, apply and enforce controls to manage residual HSE hazards and effects, apply local HSE legislation correctly, respond effectively to emergency situations, etc. These abilities must be demonstrated prior to contract award. In Group Company operations, the HSE-critical activities represent those activities for which the principles of hazards and effects management must be applied and documented as part of the HSEMS. For work contracted out, these same principles should be applied to the activities carried out by the contractor. General contractor HSE management principles, (such as his approach to hazard assessment, use of PPE, HSE inspection of plant and equipment, etc), are included in this document. Throughout this document, reference is made to the 'HSE Plan' which essentially defines the combination of the HSEMS and a description of how the HSE-critical activities are to be managed. The term 'HSE Plan' has deliberately been retained for a wider understanding of management of contractor HSE, particularly with smaller contractors.

[3] ADNOC Manual of Codes of Practice: Code of Practice on HSEIA Requirements, ADNOC-COPV1-02.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 16

An important component of the HSE Plan is the demonstration how the Group Company and the contractor intend to link their organisations for the purpose of HSE management of the contract. This is particularly important for large and long-term contracts and it should be recognised that in these situations, this HSE Plan will effectively form a significant part of the COMAH report. When the Group Company clearly defines the HSE requirements, the contractor can then provide the necessary details of his management system and demonstrate how he intends to fulfil the requirements. The way that this occurs in a typical contract is shown in Figure 2.2. Guidelines for headings and contents for an HSE Plan for major contracts are given in Appendix IV, with those for smaller contracts, such as office services, in Appendix V. 2.5 Joint HSEMS and COMAH Report Preparation In major projects under circumstances that represent significant HSE risk, it may be necessary to combine the contractor and Group Company systems to form an effective overall HSEMS for the planned operation. To achieve this it is necessary: for the Group Company to provide the contractor with details of the hazards and hazardous operations which the contractor will encounter for the Contractor to describe his HSEMS and how he will manage HSE-critical activities identified by the Group Company and those additional activities, critical to HSE performance and known to the contractor, which are inherent in undertaking the specified work to complete the HSE hazards and effects register and activities catalogue with the contractor ensuring that this is compatible with that of the Group Company to complete the COMAH report with joint input to prepare a monitoring and audit plan to audit the COMAH report and joint HSEMS.

Typically, the various parts of the joint HSEMS and COMAH report, as jointly prepared by contractor and Group Company, must be expected to have relative input from both parties.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 17

Group Company

Contract HSE Plan Development

Contractor
Outline of corporate HSEMS
Typical approach to hazards & effects management, sample procedures, etc.

Prequalification

HSEMS for cont ract


Hazard & Effects management process for development by contractor

Invitation to tender
Detailed contract specific HSEMS
Hazard & effects management process developed
List of method statements for development

Tender period
Joint HSEMS meets requirements
Hazards & effects assessment meets requirements

Proposals for method statements acceptable

Contract evaluation & award

Detailed hazards & effects assessment

Quality (HSE) System Key: Corporate Process Task

Detailed method statements & work instructions

Pre-mobilisation Pre-execution

Figure 2.2

Development of contract HSE requirements

Clearly the above will vary significantly from contract to contract. The level of complexity, detail and degree of completeness will ultimately require the sanction of the Contract Holder who must satisfy himself on behalf of the Group Company that all appropriate aspects have been considered and action taken.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 18

3.
3.1

PLANNING AND INVITATION TO TENDER


Objectives The HSE activities carried out during the planning and invitation to tender phase fall under the following headings: determine the HSE impacts on scope, schedule and strategy for the contracts required assess HSE content of each contract confirm suitability of contract scope, schedule and strategy against HSE assessments prepare HSE-related contract documents prequalify potential contractors for HSE suitability, having reviewed their past HSE performance prepare the outline contract with appropriate milestone hold points.

Ahead of any finalised contract scope, Group Companies may consider dialogue with potential bidders to discuss possible contractor involvement, especially the technical and other difficulties that might influence HSE performance. Clearly at this stage no discussion on cost issues and/or possible award is appropriate. The sequence of activities is shown in Figure 3.1. 3.2 Outline Scope of Work or Services The starting point for the planning of contractor HSE management is the definition of work or services in sufficient detail to identify the major hazards and HSE impacts. This activity must be done by the Group Company and should be determined from a separate appraisal of the business area and activities themselves. The work should include aspects such as: type of activities location of site(s) and the workplace timing and sequence personnel plant and equipment used materials and consumables.

Experience gained from previous projects should be utilised by reference to: close-out reports from similar projects formal records of previous HSE performance by contractors on similar projects similar activities in relevant and/or nearby countries

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 19

HSE audits carried out in recent years on relevant activities general background information on planned areas of operations.

Definition of work or services should include requirement for an HSEMS from which specific tasks and targets with clear deliverables by the contractor (and, where relevant, the Group Company) can be derived. It should therefore address the main elements of an HSEMS as follows: Leadership & commitment Policy & Objectives Organisation, Resources & Competence Define how senior management set personal examples, demonstrate involvement and participation, communicate to employees, etc on HSE. Define the policy statements on HSE that are to be observed. Define the formal structure for organisation, allocating resources, defining communications and responsibilities on HSE issues between the Group Company and the contractor, setting minimum competence levels and training requirements in HSE expected on the project for Group Company and contractor staff and specifying documentation control. Describe how hazards and effects are to be identified, assessed, controlled and how recovery in the event of loss of control will be carried out. Describe how the controls for hazards and effects management are to be implemented, develop a comprehensive listing of HSE standards and procedures applicable to the project, describe change management proposals and emergency response procedures. Define how HSE performance is monitored, the criteria for HSE performance and how corrective action is to be taken. Define the basis under which internal and external HSE auditing and management reviews will be conducted.

Evaluation & Risk Management Planning, Standards & Procedures

Implementation & Monitoring Audit & Review

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04
Definition Identify workscope

Version 1 June, 2004 Page 20

Establish notional contract strategy DRAW UP POTENTIAL BIDDER LIST FROM LIST OF APPROVED CONTRACTORS No For main contractor For sub-cintractor(s)

Yes

Can an existing contract be used?

Take this into account during HSE assessment SCREEN POTENTIAL CONTRACTORS FOR SUITABILITY Previous experience Previous reports

Yes

Are potential contractors prequalified?

No

BASED ON THE HSE ASSESSMENT Determine scope for (supplementary) HSE plan Upgrade current regulations Determine need for additional supervision (Opco & contractor) Ditto training

Make an HSE assessment for each contract

SCREEN POTENTIAL CONTRACTORS FOR HSE SUITABILITY Previous experience Previous reports Questionnaire Visits, interviews, audits

Finalise HSE aspects for inclusion in variation order

Review HSE assessment against contract schedule and strategy Review/modify schedule Is contract schedule and strategy suitable? Yes BASED ON THE HSE ASSESSMENT No

Obtain final approval for bid list

Define scope of contractors HSE Plan Identify pertinent HSE regulations for the contract Agree Opco supervision strategy Identify and schedule Opco/contractor training needs Determine extent of prevailing influence Incorporate HSE related costs in contract Fix minimum pre-execution requirements Hold pre-tender meeting if considered necessary Agree HSE bid evaluation criteria and obtain tenderboard endorsement

Finalise HSE aspects for contract documents

Figure 3.1

Management of Contractor HSE flowchart: planning

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 21

3.3

Contract Scope, Schedule and Strategy The contract scope identifies those project activities that will be contracted out. For each contract, a short but comprehensive description of the work should be produced, from mobilisation to demobilisation. A contract schedule should be developed with due consideration of the HSE issues involved, paying particular attention to allowing adequate time for mobilisation/demobilisation. The contract schedule should highlight HSE issues that require special emphasis in later contract phases. The contract strategy adopted can be the single most important strategic management decision of a project. The factors to be considered in formulating the strategy include: number of contracts (and hence the number of Group Company contractor interfaces) availability of suitable existing contracts (e.g. service, call-off, etc) contractor resources and skills Group Company supervision resources and skills Group Company/contractor responsibilities local environment contract/project schedule competitive situation UAE and National Laws & Regulations prevailing influence Prevailing influence allows the Group Company to impose its own HSE requirements. In contrast, negligible influence only allows the imposition of relevant UAE and National HSE Laws & Regulations.

The interfaces between Group Company and contractor is an area that needs careful review and clear definition. The following two examples illustrate the problem: Example 1: a small contractor uses Group Company-owned mobile access equipment for electrical modifications on various sites. Responsibility for ensuring the maintenance of the equipment and the competency of the personnel using it should be defined. Example 2: An EPC contract for the expansion of a plant requires the new facilities to be brought on stream with no interruption to production on the existing plant. The Group Company/contractor interfaces are likely to be complex on start-up and the scope must specify the format and type of detail required for the start-up stage.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 22

A primary consideration in determining strategy is the extent to which project management is relinquished to the contractor. For HSE issues this will be particularly important for those aspects associated with project organisation and communications. Contract strategy should consider provisions for delay or forfeit of contract payments pending results of HSE audit findings and satisfactory completion of action items. Non or late submission of key HSE Plans and documents should be linked to contract payments. 3.4 Contract HSE Assessment A structured, formal HSE assessment should be developed for each anticipated contract. The details should be formally recorded with future actions identified and, wherever possible, action parties nominated. This will comprise elements of the HSEMS, together with aspects associated with the particular activities of the work, described in 3.2 above. The main objective of the formal assessment is to generate a plan that incorporates all Group Company and contractor HSE aspects relevant to the contract workscope. This plan will ultimately provide the framework for the contractor's HSE Plan. The main headings of the assessment are: carry out HSE hazards and effects management process Follow the process of identifying, assessing and controlling HSE hazards and establishing methods for recovery in the event of loss of control. If the contract relates to a development project then the hazards and effects management process will be underway and the hazards already identified will be added to those identified as projectspecific and will be included in the project hazards and effects register. If the contract relates to a common or recurring activity then the Contract Holder can access the hazards and effects register for that activity. identify the applicable HSE Laws & Regulations and Group Company standards and procedures identify the Group Company's HSE project organisation/interfaces and define supervision requirements, roles and responsibilities (see Appendix III for key personnel) examine carefully areas where critical time schedules and resource limitations may call for extra attention to HSE determine communication needs including scope and schedules for meetings identify minimum induction and training requirements: for both Group Company and contractor. Prepare a training schedule, paying particular attention to training needs for exceptional activities.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 23

Whilst major hazards associated with the operational phase of the project will have been identified earlier, the assessment at this stage will build up the level of detail and should involve the people who will participate in the project. The suitability of the notional contract scope, schedule and strategy should then be confirmed against the HSE assessment. At this stage, It may be appropriate to have dialogue with potential bidders as a further means of ensuring comprehensive coverage of HSE issues in the contract HSE assessment. 3.5 Contract HSE Specification The HSE assessment results may now be translated into a specification for inclusion in the tender as follows: define the scope of the HSE Plan and in particular the hazards to be addressed identify the HSE Laws & Regulations and Group Company standards and procedures that will be applicable to the contract define the Group Company/contractor interfaces and the Group Company supervision strategy identify and schedule Group Company and contractor training requirements determine the minimum 'pre-execution' requirements.

Appendix IV and V provide guidelines for defining the requirements of an HSE Plan for major and small contracts respectively (also refer to section 2.4). The tender HSE documentation should be compiled, with due attention to the following: Group Company responsibilities It is the Group Company's responsibility to ensure that the tender documents comprehensively cover the HSE requirements for the contract. Assumptions that the contractor already knows the issues are dangerous. Time must be spent to make comprehensive, clear and concise tender documents. Knowledge about hazards already identified by the Group Company must be passed on to bidding contractors. Minimum requirements The hazardous activities that need addressing by the contractor should be listed by the Group Company. Selection of these activities should be based on due consideration of the known exposure and frequency presented by these hazardous activities. Contractor responsibility The contractor must have independent responsibility for his own HSE Plan, but tender documents must make clear provision for the Group Company to perform HSE audits on the contractor in order to confirm compliance.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 24

Contractor reporting Clearly identified reporting requirements regarding HSE performance during contract execution. Contractor performance Provision for the suspension of work if the contractor does not observe the HSE requirements and, in particular at mobilisation, to withhold permission to start execution and hold payments until a satisfactory preexecution audit has been achieved. Special HSE provisions Where special HSE provisions are to be provided which require separate identification/pricing in the bid, the tender documents should specify these clearly and identify where the bidding contractor is to price for them.

In preparing his bid, the contractor must demonstrate compliance with such requirements by preparing his own HSE Plan within the Group Company framework. Bidding contractors must be allowed the freedom to use industry HSE standards if they are equivalent to or exceed the Group Company's standards. The Group Company must ensure the availability of expertise and resources to evaluate the proposed alternative standards. The tender documents must permit the flexibility for the contractor to take on ownership of his HSE responsibilities in order to retain the ability to manage the contract effectively. Short lead times for tender preparation could compromise the establishment of a sound basis for HSE management. The following aspects should be considered: use standard contracts, where possible ensure adequacy of document coverage make the documentation unnecessary bureaucracy appropriate for the contract without

specify any constraints on the methods of working identify where concurrent Group Company operations could be impacted take account and state the limits of the Group Company's prevailing influence.

This last aspect is of special concern in mobilisation and demobilisation phases and influence can be exerted by ensuring that these phases are adequately covered in the HSE Plan. In some instances the ability to exercise influence may be limited (for example when work is being carried out in a yard or factory where only a small percentage of the contractor's workload is for the Group Company).

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 25

3.6

Contractor Prequalification The general practice for selecting contractors is through the competitive tendering process. In the prequalification stage, potential contractors are screened to establish that they have the necessary experience and capability to undertake the contract in question. Only those meeting the necessary HSE criteria should be included on the prequalified list. A formal historical record of the HSE performance of all contractors previously employed should be maintained by the Group Company for use at tender prequalification. Prequalification is usually achieved by issuing a standard format document for the contractor to complete, supported where necessary by historical performance records. It may be necessary to review the content of standard format document and to add or emphasise requirements specific to the contract. Of special importance is the management by contractors of their subcontractors and the need for the main contractor to demonstrate his understanding and commitment to having full responsibility in this area. Appendix I provides guidelines for an HSE prequalification questionnaire. This questionnaire is directed towards establishing the status of the contractor's HSEMS. A points system method, which minimises subjective judgement, may be used to evaluate contractors' submissions. Contractors who achieve a predefined acceptable score will then be judged to have met the HSE pre-contract requirements. Appendix II provides guidelines for a points evaluation system. Group Companies should aim to be fully satisfied that contractors, eventually invited to bid, can perform the work to the required HSE standards. When prequalifying new or unknown contractors, it will may be necessary to arrange for inspection visits to the contractor's base site (with particular emphasis being placed on ensuring that the contractor has the resources and management structure to meet the Group Company HSE standards). Where considered necessary, the contractor's existing sites should be audited to verify that he can achieve the HSE standards proposed for the new contract. Exclusion of a contractor from a bid list may be necessary as a result of his unsatisfactory HSE record. The contractor should be clearly informed of the deficiencies in his HSE management performance and that inclusion in subsequent bid lists will require improved HSE performance. Contractor prequalification as described above is necessary for large or specialised contracts where new contractors or existing contractors must be vetted with respect to their capabilities to manage HSE matters against a particular scope of work. For more routine contracts it is likely that a Group Company will maintain a 'Register of Approved Contractors' whereby contractors are registered once considered capable of undertaking certain types of work effectively, including the management of the HSE aspects. The contractors are initially reviewed or

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 26

prequalified in a manner similar to that described above. Once the Group Company is satisfied that the contractors have the necessary systems in place to manage certain types of contracts satisfactorily they are permitted to bid for these. It is important to maintain a Group Company-wide system that can record upto-date details on the HSE performance of these contractors on contracts awarded to them. This system should also prompt the initiation of periodic HSE reassessments of contractors who have not been successful in bidding to ensure that HSE information is current. In large Group Companies, where a contractor may be working for a number of functions, it will be beneficial to assign a focal point within the Group Company to oversee the activities of that particular contractor in terms of work undertaken, resources available, potential over-commitment. The Group Company focal point must be fully familiar with the contractor's structure, the intended spread of resources and ultimately his HSE performance. The Group Company focal point is also in a position to provide Group Company management with an assessment of status before commitment to any particular strategy involving that contractor.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 27

4.
4.1

THE TENDER PERIOD


Objectives The HSE activities carried out in the tender phase fall under the following main headings: a. contractor's preparation of his HSE Plan in accordance with the b. framework provided by the Group Company c. Group Company responses to contractor's HSE clarification requests. d. Copies of queries and replies should be circulated to all contractors. e. Clarification meetings which may be held with contractors individually or in groups. All such meetings should be recorded by the Group Company. f. Site visits by contractors (as necessary). All meetings and visits should be recorded by the Group Company. The lead times for tender response should be sufficient for tenderers to provide a sound basis for HSE management.

4.2

Contractor's HSE Plan The principal activity in this phase is the preparation of the HSE Plan by the contractor. For a major contract this will probably form a significant part of the COMAH report (refer to Section 2.4). The HSE Plan must cover all contract phases from mobilisation to demobilisation and should provide a clear indication of the policies, procedures, standards, etc to be adopted during each phase of the contract. The contractor should use as the basis for his HSE Plan the Group Company contract HSE documents as described above in Chapter 3. However, as part of his submission, the contractor is required to state his own proposals within the framework described. In particular, the contractor should: Develop his own hazard assessment of the work described for the contract Define his execution proposals. The contractor should confirm his proposed use of policies, procedures, standards, etc and show that these comply with Group Company requirements or add to them where he believes the contract guidelines are insufficient. Demonstrate familiarity with the type of work involved Confirm his understanding that the Group Company standards and guidelines represent minimum standards.

These guidelines are designed to indicate the key features of the HSE Plan but are not necessarily exhaustive. The contractor may add to the list where needed. Conversely, some items in these guidelines may not apply to some contracts.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 28

4.3

HSE Costs The main objective should be to provide a clear means of assessing the weight each contractor is giving to HSE in his submission and for him to demonstrate that he has allocated sufficient resources to implement the HSE Plan satisfactorily. The tender documentation should, where possible, provide a mechanism to allocate costs of implementing HSE requirements and for the contractor to indicate these costs separately. However, care should be exercised to ensure that separated HSE costs are not included here for work which should be carried out as part of normal good practice. HSE pricing would normally be expected for such items as: audits meetings induction and training medical facilities, first-aid training, Medevac, safety equipment waste disposal incentive schemes personal protective equipment (PPE) emergency resources health surveillance journey management in logistics.

4.4

Incentive Schemes for HSE Incorporating an incentive scheme for HSE, involving additional payment in a contract, needs very careful consideration. It can absorb a significant degree of effort to administer and the longer term effectiveness can be questionable. To be effective such a scheme should: not discourage or suppress the reporting of incidents be proactive and therefore reward effort, e.g. audits and follow-up rather than 'after the event' statistics ensure that incentives are enjoyed and valued by the personnel who are in a position to influence the performance and maintain the systems be culturally adapted to the local environment.

A contract which has no incidents may reflect a considerable effort by personnel and a good HSEMS; on the other hand it can equally indicate a period of good fortune.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 29

With a better definition of what is expected from contractors in terms of the HSE Plan, it is easier to link contractual payments to the satisfactory development of the HSE Plans and the subsequent adherence to them. This, together with a more objective end-of-contract rating against the plan (used in evaluations for future work), is an effective long-term incentive for the contractor.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 30

5.
5.1

EVALUATION AND CONTRACT AWARD


Objectives The evaluation phase should: Evaluate thoroughly each contractor's HSE Plan. This should check that the HSE Plan achieves the minimum standards, including reference to proposed key competencies, subcontractors, manning levels, plant and resources, etc. evaluation acceptable personnel equipment

5.2

Clarify each contractor's HSE Plan where necessary and record all clarifications for inclusion in contract Establish the costs included in each bid for HSE activities Evaluate and provide rating and comparison of HSE aspects in the bids to determine acceptability on HSE requirements.

Evaluation The main focus of the HSE evaluation is the contractor's HSE Plan although other aspects of the bid should be scrutinised. In particular, aspects of the contractor's execution plan may be inconsistent with his stated intent regarding the fulfilment of HSE requirements and may need clarification (including site visits). It is important to establish the current status of the contractor's preparedness for HSE in the contract and to ascertain if further action is necessary on his and the Group Company's part before proceeding. In this regard, the Group Company should assess HSE costs and resources required for a specific contractor as well as those stated in the contractor's bid. Such Group Company requirements vary depending on the preparedness and HSE competence of the contractor. Where a tender is considered, even though it has HSE deficiencies, the Group Company should include an estimate of the cost of additional Group Company or contractor resources and the time needed to bring performance up to standard and take this into consideration when evaluating bids. The extent of the evaluation of HSE depends on the degree of HSE requirements for the contract but will have been determined by the level of work in the previous phases. Appendix II describes a guideline evaluation method for prequalification based on a points system. This method may also be followed for tender evaluation by utilising the expanded headings in the Group Company contract HSE documentation.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 31

6.
6.1

MOBILISATION
Objectives In the mobilisation phase the principal activities are as follows: Hold kick-off meeting (Group Company and contractor jointly) Commence mobilisation (contractor) Review and finalise the contractor's HSE Plan (Group Company and contractor jointly) Commence induction and training (Group Company and contractor jointly) Supervise, inspect and monitor progress (Group Company) Fulfil pre-execution milestone requirements (contractor) Hold pre-execution HSE audit (Group Company).

Prior to mobilisation, it is likely that the full HSE Plan is known only to the principal members of the Group Company's and contractor's project management teams. During mobilisation the HSE Plan has to be implemented by the management of both the Group Company and the contractor. Depending on the circumstances, additional Group Company supervisory staff may be required to allow rapid set-up and implementation of the HSE Plan. The resources required at this stage should not be underestimated. During mobilisation the Group Company must ensure that the contractor sets up a method of operation that is in accordance with the HSE Plan. It is at this stage that the implementation and ownership of the HSE Plan by the contractor begins and this needs careful control. Aligning all these interests requires the introduction of a good working relationship between Group Company and contractor and between contractor and subcontractors. The effective transfer of HSE responsibilities to any subcontractors, particularly if their activities are difficult to monitor (e.g. transportation), is particularly important. The HSE activities that will be implemented during mobilisation are indicated in Figure 6.1. 6.2 Kick-off Meetings An HSE kick-off meeting should be held with the contractor immediately after contract award and before the execution of any work. For a new contractor, the kick-off process should include both Group Company Contract Holder and the contractor's local management. If the contractor mobilises locally at the worksite, the kick-off meeting can similarly be held locally. If not, it may be necessary to hold the initial kick-off meeting at the contractor's base office, subsequently authorise mobilisation of his key personnel to site and follow up with a further local kick-off meeting.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 32

The local meeting should be held immediately prior to the start of any work. It should ensure that the contractor's workforce and supervisors are aware of the site hazards of the operation detailed in the scope of work and are familiar with HSE working procedures, rules and regulations, alarms and signals, emergency communications and procedures. Additional topics to be covered should include: Confirmation of the HSE Plan to be implemented Confirmation of contractor employees' competence in HSE Confirmation of HSE performance objectives Distribution and explanation of the Group Company HSE policy statement, basic HSE rules and work procedures Confirmation of the scope and schedule of activities to pre-execution milestone, HSE meetings, audits and reviews Group Company and contractor contingency plans Contact with third parties to ensure their role in emergency response plans is known Confirmation that HSE induction and training plans are in place Briefing of subcontractors on HSE requirements Incident reporting and investigation procedures.

The meeting may be structured as an HSE workshop, with participation by both Group Company and contractor management. At the same time as the kick-off meeting, the opportunity should be taken to check the physical evidence that HSE systems are in place, for example: HSE equipment Communications Environmental protection Health hazard identification and assessment, medical facilities, Medevac procedures HSE awareness and promotional material HSE documentation manuals.

The kick-off meeting should not be used as an opportunity to raise new HSE issues that should have been covered in the contract documentation.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 33

Contract Award

Yes

Contractor mobilises locally?

No

Hold kick-off meeting locally

Hold kick-off meeting at contractors base office

MOBILISATION LOCAL TO WORKS VICINITY Company: Review HSE plan Monitor pr-execution status Supervise, inspect, audit Contractor: Contract HSE plan Fulfill pr-execution procedure All: Commence (or continue) induction and training Attend progress meetings

MOBILISATION REMOTE FROM WORKS VICINITY Company: Review HSE plan Monitor pr-execution status Supervise, inspect, audit Contractor: Contract HSE plan Fulfill pr-execution procedure All: Commence (or continue) induction and training Attend progress meetings

Continue mobilisation

Contractor (and sub-contractor(s)) mobilise key personnel and equipment to vicinity of works

Pre-execution HSE audit

Hold kick-off meeting locally

Has the contractor met the specified milestone requirements?

No

Yes

Proceed to execution

Figure 6.1

Management of Contractor HSE flowchart: mobilisation

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 34

6.3

Mobilisation Once mobilisation activities have commenced, the Group Company should begin its supervision, monitoring, inspection and audit functions of the contractor's pre-execution activities to ensure the contractor's HSE Plan is being implemented. The Group Company supervisory function should ensure that the contractor has deployed his supervisory staff and is implementing the briefing and training that are required for his supervisors and employees. During the early part of the mobilisation phase it is likely that all personnel (Group Company and contractor) assigned to the project will attend an employee HSE orientation programme. During mobilisation the contractor should finalise the HSE Plan. He should incorporate the agreements reached with the Group Company at the kick-off meeting. The final HSE Plan for the contract will then be produced. Progress meetings should then be used as the formal method of reviewing HSE implementation.

6.4

Pre-execution Audit At this stage of the mobilisation (known also as milestone zero) an audit against the contractor's HSE Plan should be completed to determine whether the contractor has achieved the necessary targets stated in the HSE Plan and whether mobilisation can be considered complete. Achievement of HSE Plan targets should represent the first milestone of the project to which first stage payments may be associated. A contract clause reserving the right to terminate on failure to meet this milestone should be considered. The extent of the audit will again depend on the size and complexity of the contract. For a small contract an audit may be conducted by means of a simple checklist. For a large and complex contract a more analytical approach may be required. If the audit proves to be unsatisfactory then the status of the contractor's progress should be carefully reviewed. The options available at this stage are: Minor deficiencies - For relatively minor deficiencies the contractor should be requested to implement corrective action and the audit repeated. It may be possible to allow this to take place in parallel with initiating the execution phase. Serious omissions - In the more serious omissions the option of withholding permission to proceed or even terminating the contract may be necessary.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 35

7.
7.1

EXECUTION
Objectives Under the contract, the responsibility for proper supervision of the contractor's personnel on HSE matters rests with the contractor himself. However, the Group Company Representative should ensure that contractor's supervision complies with the requirements defined in the contractor's HSE Plan. Such checks should include confirmation of the following: The contractor's line management commitment to the HSE issues Reinforcement of the HSE targets as defined in the contractor's HSE Plan The provision of training as needed for specific contractor employees The regular checking and review of the contractor's performance by the Group Company Contract Holder The contractor's monitoring of the quality, condition and integrity of his plant, equipment and tools The contractor's holding of daily toolbox meetings and regular HSE meetings (minimum-weekly) The contractor's implementation of exercises and drills of contingency plans with maintenance of an effective audit trail, including follow-up and close-out of action items Monitoring of the contractor's incident investigation and follow-up Performance of HSE inspections/audits and reviews of the contractor's activities (including contractor's internal HSE control system) Any deviations from the HSE Plan formally assessed and approved.

7.2

Supervision The Group Company's commitment to sound working practices in HSE matters should be visibly demonstrated in contract execution by providing a representative or representatives from line management to fulfil the HSE obligations of the Group Company as described in the contract. Where there is access to Group Company HSE advisers or specialists, then it is important that the role of the adviser is understood to be indeed that of an adviser. The Contract Holder or Group Company Representative(s) may seek advice, support or services from an HSE Adviser on a routine or periodic basis but the responsibility for HSE matters on the contract must remain unmistakably with the assigned Contract Holder or Group Company Representative(s). The extent of supervision will depend on the local circumstances and nature of the work. If the worksite is on or close to operating plant, more supervision may be required than, for example, on a new construction site. However a

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 36

balance must be struck: too much instruction and direction by the Group Company tends to relieve the contractor of responsibilities stipulated in the contract. Demonstration of the Group Company's commitment to sound HSE management should be provided by: Verification that all HSE-related clauses in the contract are being complied with Regular and random site inspections by both the Contract Holder and the Group Company Representative(s) Attendance at regular HSE meetings with the contractor Follow-up of all incident reports Prompt provision of resources and advice for HSE matters Not cutting corners on costs for HSE aspects of the work Regular evaluation reports of the contractor's HSE performance Measures to promote improvements in HSE performance In extreme circumstances exercise of the right to curtail or suspend work for HSE reasons.

An HSE audit and review programme should be prepared, stating specifically what is expected of the Group Company Representative(s) in ensuring that the HSE Plan is finalised and adhered to, together with details of how the performance of the Group Company Representative(s) is to be measured. In certain circumstances it may be necessary to provide additional HSE specialist personnel to ensure the requisite level of supervision. 7.3 Competence Assurance During execution of the work the Group Company should monitor the competence assurance and associated training programme of the contractor and ensure that it meets the requirements of the HSE Plan. Where necessary the Group Company should also determine any additional needs which may occur as a result of local circumstances. Monitoring by the Group Company should include confirmation of the contractor's commitment to the following: Adherence to the contractor's personnel recruitment criteria Demonstration of personnel qualifications, ability and skills Provision of the necessary induction courses. Such courses should make personnel fully aware of the nature of the potential work hazards, instruct them in the use of protective and emergency equipment and explain/practise emergency drills. Training of contractor's personnel in the standards and procedures to be followed

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 37

Completion of the necessary HSE, first-aid, survival and job-related training (particularly permit-to-work system (PTW) and house rules) required by law and Group Company practices prior to starting work and the provision of certificates to that effect Provision where appropriate for contractor's personnel to attend ongoing HSE courses (preferably as mixed groups of Group Company and contractor staff) Availability of HSE documents, instruction and information leaflets and newsletters with special attention to use of local language and simple visual messages.

7.4

Inspection and HSE Auditing/Reviews Inspection and auditing provide the methods for monitoring contractor HSE activities. Regular inspections provide the day-to-day means of checking compliance with contract requirements. Auditing provides the more formal and comprehensive assessments of adherence to the written framework of the contract (the contractor's HSE Plan). The contractor will have defined in his HSE Plan his own audit/review plan for his work and that of his subcontractors. The documented evidence of these audits should be available to the Group Company together with the follow-up action taken. Inspections should be used to cover such aspects as: Compliance with PTW system Operational condition of HSE equipment HSE features on plant and equipment Reliability, serviceability and maintenance of work tools and equipment Emergency and contingency plan readiness and drills including use of firefighting equipment and first-aid Correct use of protective equipment Employee HSE awareness and demonstrated use of safe work practices.

The effectiveness of inspections can often be enhanced by the use of unannounced spot checks and involvement of the contractor's responsible supervisory personnel. Inspection and auditing is the primary responsibility of the contractor. However, Group Company supervisory staff should be tasked to monitor the implementation of the contractor's HSE Plan and ensure that the contractor's systems are in place. In doing so, however, it must be clear to the contractor that the responsibility for management of HSE is his.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 38

Auditing practices may be used to examine specific technical areas in more detail or to provide in-depth HSE management assessments (e.g. the contractor's internal HSE controls). Further details on auditing are given in the ADNOC Group Guideline Manual for ADNOC-led HSEMS Audits [Ref. 5]. The findings of all inspections and audits together with follow-up reports should be fed back to the contractor's site and office management. Effectiveness of audits may be enhanced by linking contract payment to completion of audit action items. Appendix VI provides a list of reference headings which can be used to derive topics for audit evaluations.

[5] ADNOC Group Guideline Manual for ADNOC-led HSEMS Audits, January 2002.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 39

8.

DEMOBILISATION
The contractor's HSE Plan continues to be the vehicle for monitoring his HSE activities in this phase. Two new areas figure prominently: Site restoration Waste management and disposal.

The contractor's HSE Plan should be reviewed as a first step before work commences. Due consideration should be taken of any similar activities with mobilisation, the problems encountered and solutions found. The Group Company should continue to monitor the contractor's performance against his plan, including attention to incident reporting. It is important to maintain vigilance on HSE matters to the very end of the contract.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 40

9.

CLOSE-OUT
The close-out report provides the formal method of providing feedback to Group Company management and for recording a concise history of the contract for future use. The report should derive the majority of its content by extracts from factual documentation collected during the entire duration of the contract. The analysis and summary at the conclusion should address the following: Assess the effectiveness of the contractor's HSE Plan Identify those areas unanticipated in the plan, how they were overcome and the future approach to be taken Highlight successful positive aspects that should be used in the future Provide a concise analysis of both the Group Company's and the contractor's HSE performance for discussion with the contractor's management for means of improvement Provide input information on the contractor for Group Company bid list to identify actions needed in assessments for future tenders.

The HSE close-out data should be recorded and fed back into the Register of Approved Contractors or another easily accessible form for future reference. A formal record of HSE performance should be kept on each contractor and be fully discussed with the contractor's management.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 41

10.
1. 2. 3. 4. 5.

REFERENCES
ADNOC Manual of Codes of Practice: Guideline on HSE Definitions & Abbreviations, ADNOC-COPV1-05 ADNOC Manual of Codes of Practice: Code of Practice on HSE Administration Systems, ADNOC-COPV1-01. ADNOC Manual of Codes of Practice: Code of Practice on HSEIA Requirements, ADNOC-COPV1-02. ADNOC Group Guideline HSE Management Systems, January 2002. ADNOC Group Guideline Manual for ADNOC-led HSEMS Audits, January 2002.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 42

APPENDIX I: CONTRACTOR HSE PREQUALIFICATION

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 43

APPENDIX I. 1 2 3 4

CONTRACTOR HSE PREQUALIFICATION

General guidelines for preparation of questionnaire The questionnaire should cover the information required to assess the extent to which HSE and its management are organised by the contractor. The contractor should be advised to cover all (including support) activities and not just those conducted on ADNOC or Group Company sites. The questionnaire should be completed by contractor line management. Emphasis should be placed on the need for complete answers substantiated by supporting documentation as far as is practicable. Responses and any supporting documentation must relate specifically to the policy and organisational arrangements of the company that would be the signatory of any contract. Submissions should be assessed by a scoring mechanism that can be used in the evaluation process. If necessary, follow-up discussion with the contractor's management may be needed.

5 6

7 The contractor should be encouraged to identify where he exceeds Group Company requirements and this excellence should be recognised.
Table I.1 Questionnaire for contractor HSE prequalification
Questionnaire items Section 1: Leadership and Commitment (i) Commitment to HSE through leadership a) Are senior managers personally involved in HSE management? b) Is there evidence of commitment at all levels of the organisation? c) Is there a positive culture towards HSE matters. Section 2: Policy and Strategic Objectives (i) HSE policy documents a) Does your company have an HSE policy document? If the answer is YES please attach a copy. b) Who has overall and final responsibility for HSE in your organisation? c) Who is the most senior person in the organisation responsible for this policy being carried out at the premises and on site where his employees are working? Provide name, title and experience. (ii) Availability of policy statements to employees a) Itemise the methods by which you have drawn your policy statement to the attention of all your employees? b) What are your arrangements for advising employees of changes in the policy? Responses

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table I.1 Questionnaire for contractor HSE prequalification (continued)
Questionnaire items Section 3: Organisation, Resources and Competence (i) Organisation commitment and communication a) How is management involved in HSE activities, objective-setting and monitoring? b) How is your company structured to manage and communicate HSE effectively? c) What provision does your company make for HSE communication meetings? (ii) Competence and Training of managers/ supervisors/senior site staff/ HSE advisers Have the managers and supervisors at all levels who will plan, monitor , oversee and carry out the work received formal HSE training in their responsibilities with respect to conducting work to HSE requirements? If YES please give details. Where the training is given in-house please describe the content and duration of courses. (iii) Competence and General HSE training a) What arrangements does your company have to ensure new employees have knowledge of basic industrial HSE, and to keep this knowledge up to date? b) What arrangements does your company have to ensure new employees also have knowledge of your HSE policies and practices? c) What arrangements does your company have to ensure new employees have been instructed and have received information on any specific hazards arising out of the nature of the activities? What training do you provide to ensure that all employees are aware of Group Company requirements? d) What arrangements does your company have to ensure existing staff HSE knowledge is up to date? (If training is provided in-house please give details of content.) (iv) Specialised training a) Have you identified areas of your company's operations where specialised training is required to deal with potential dangers? (If YES please itemise and provide details of training given.) b) If the specialised work involves radioactive, asbestos removal, chemical or other occupational health hazards, how are the hazards identified, assessed and controlled? (v) HSE qualified staff additional training (vi) Assessment of suitability of subcontractors/ other companies Does your company employ any staff who possess HSE qualifications that aim to provide training in more than the basic requirements? a) How do you assess: - HSE competence - HSE record of the subcontractors and companies with whom you place contracts?

Version 1 June, 2004 Page 44

Responses

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table I.1 Questionnaire for contractor HSE prequalification (continued)
Questionnaire items b) Where do you spell out the standards you require to be met? How do you ensure these are met and verified? Section 4: Risk evaluation and Management (i) Hazards and effects assessment What techniques are used within your company for the identification, assessment, control and recovery of hazards and effects? Do you have in place any systems to monitor the exposure of your workforce to chemical or physical agents? How is your workforce advised on the properties of chemicals encountered in the course of their work? What arrangements does your company have for provision and upkeep of protective clothing, both standard issue, and that required for specialised activities? Does your company have in place systems for identification, classification and management of waste?

Version 1 June, 2004 Page 45

Responses

(ii) Exposure of the workforce (iii) Handling of chemicals (iv) Personal protective equipment

(v) Waste management

Section 5: Planning, Standards and Procedures (i) HSE or operations manuals a) Do you have a company HSE manual (or Operations Manual with relevant sections on HSE) which describes in detail your company approved HSE working practices relating to your work activities? If the answer is YES please attach a copy of supporting documentation. b) How do you ensure that the working practices and procedures used by your employees onsite are consistently in accordance with your HSE policy objectives and arrangements? (ii) Equipment control and maintenance How do you ensure that plant and equipment used within your premises, on-site, or at other locations by your employees are correctly registered, controlled and maintained in a safe working condition? a) Where do you spell out the standards you require to be met? b) How do you ensure these are met and verified? c) Is there an overall structure for producing, updating and disseminating standards? (iv) Road Safety Management What arrangements does your company have for combating road and vehicle incidents?

(iii) Standards

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table I.1 Questionnaire for contractor HSE prequalification (continued)
Questionnaire items Section 6: Implementation and Monitoring (i) Management and performance monitoring of work activities a) What arrangements does your company have for supervision and monitoring of performance? b) What type of performance criteria are used in your company; give examples c) What arrangements does your company have for passing on any results and findings of this supervision and monitoring to your: - base management - site employees? (ii) HSE performance achievement awards (iii) Statutory notifiable incidents /dangerous occurrences Has your company received any award for HSE performance achievement? Has your company suffered any statutory notifiable incidents in the last five years (safety, occupational health and environmental)? (Answers with details including dates, most frequent types, causes and follow-up preventative measures taken.) (iv) Improvement requirement and prohibition notices Has your company suffered any improvement requirement or prohibition notices by the relevant national body, regulatory body for HSE or other enforcing authority or been prosecuted under any HSE legislation in the last five years? (If your answer is YES please give details.) (v) HSE performance records a) Have you maintained records of your incidents and HSE performance for the last five years? (If YES, please give following details for each year, number of Non Lost Time Injuries, number of Lost Time Injuries, number and type of injuries, total hours worked by workforce for each corresponding year, Frequency Rates, your company definition of a Lost Time incident). b) How is health performance recorded? c) How is environmental performance recorded? d) How often is HSE performance reviewed? By whom? (vi) Incident investigation and reporting a) Who conducts incident investigations?

Version 1 June, 2004 Page 46

Responses

b) How are the findings following an investigation, or a relevant incident occurring elsewhere, communicated to your employees? c) Are near misses reported?

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table I.1 Questionnaire for contractor HSE prequalification (continued)
Questionnaire items Section 7: Audit and Review (i) Auditing a) Do you have a written policy on HSE auditing and how does this policy specify the standards for auditing (including unsafe act auditing)? b) Do your company HSE Plans include schedules for auditing and what range of auditing is covered? c) How is the effectiveness of auditing verified and how does management report and follow up audits? Section 8: HSE Management - Additional Features (i) Memberships of Associations Does your company hold membership of any industry, trade or HSE organisation? Does your company have any other HSE features or arrangements not described elsewhere in your response to the questionnaire?

Version 1 June, 2004 Page 47

Responses

(ii) Additional features of your HSE management

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 48

APPENDIX II: PREQUALIFICATION HSE EVALUATION GUIDELINE (POINTS SYSTEM)

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 49

APPENDIX II PREQUALIFICATION HSE EVALUATION GUIDELINE (POINTS SYSTEM) Scoring The contractor's tender should be evaluated by attaching a score to the selected response for each category (see Appendix I). A suggested scoring system would be as follows (see Table II.1): HSE Plan documentation (sections 1 to 5, 7, 8): A 0 B 3 C 6 D 10

Performance and experience factors (HSE incidents) (section 6): 0 7 14 20

Elements scoring 0 should normally disqualify a contractor from being included in a prequalification list. Any elements rated so must be highlighted as a qualification on the tender if it is still to be considered.
Table II.1 Rating of contractors' prequalification by a points scoring system (headings and item numbers refer to Appendix I)
A B C D

Section 1: Leadership and Commitment Commitment to HSE through leadership: Appendix I, Item 1(i) No commitment from senior management HSE disciplines delegated to line managers - no direct involvement by senior management Evidence of active senior management involvement in HSE aspects Evidence of a positive HSE culture in senior management and at all levels

Section 2: Policy and Strategic Objectives HSE policy documents and availability: Appendix I, Items 2(i) and 2(ii) No written HSE policy A policy statement exists but not in a widely distributed document HSE policy establishes responsibility for HSE, but not widely distributed Policy with clearly established responsibility and accountability; is distributed to all employees; and is visible on notice boards

Section 3: Organisation, Resources and Competence HSE communication and meeting programmes: Appendix I, Item 3(i) None Periodic HSE meetings for special operations only HSE meetings performed on a regular basis at management and supervisor level In addition to C employees are assigned topics to discuss on a rotational basis

Staff HSE training: Appendix I, Item 3(ii) No specialised staff training HSE training assigned to a specific person on location HSE training applied to management but not comprehensively covered HSE training given formally to all relevant staff on their respective responsibilities

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table II.1

Version 1 June, 2004 Page 50

Rating of contractors' prequalification by a points scoring system (headings and item numbers refer to Appendix I) (continued)
A B C D

Employee orientation and training programme: Appendix I, Item 3(iii) No formal programme Verbal instructions on Group Company procedures only Orientation booklet provided for new employees but no on-thejob orientation by supervisor Specialised training: Appendix I, Items 3(iv) and 3(v) No HSE training established On-site basic training conducted occasionally HSE training is given for specialised operations, but no routine training conducted Formal HSE training programmes have been developed in all areas and are conducted on a regular basis. Retraining periods are established Employee handbook provided and supervisor outlines, explains and demonstrates new employee's job All under C together with: follow-up observation of the new employee's work is also included. Employee has explained to him safe practices and emergency duties

Subcontractors: Appendix I, Item 3(vi) No written arrangements Written arrangements in place for basic HSE matters only HSE arrangements incorporated in HSE manual but not in a format which is distributed to all employees HSE arrangements exist in handbook form, distributed to all employees, subcontractors, subcontractor employees and are enforced. Follow-up audits held with discussion/feedback to management and employees

Section 4: Risk Evaluation and Management Hazards and Effects Assessment : Appendix I, Item 4(i) Company's HSE system does not include hazards and effects assessment Company's HSE system makes reference to the need to assess hazards and effects but has no comprehensive structure to carry this out Company's HSE system includes methods for the assessment of major hazards and effects Company's HSE system has a comprehensive set of methods for the assessment of all HSE hazards and effects and applies them to all of its contracts with documentation

Exposure of the workforce: Appendix I, Item 4(ii) Company does not actively advise the workforce nor monitor exposure Company advises the workforce of the major hazards that they are likely to be exposed to but only monitors exposure randomly Company has formal methods for monitoring exposure to the major hazards Company has a set of formal methods for monitoring exposure to all foreseeable hazards (linked to its hazards and effects assessment method) and applies them to all contracts

Handling of chemicals: Appendix I, Item 4(iii) Company makes no special provision for advising the workforce about properties of chemicals Company provides information to workforce in the workplace on properties of chemicals but has no active followup Company distributes information to individuals in the workforce at start of their involvement onsite Company maintains a database of the properties of all chemicals encountered in its contracts and has formal methods of information distribution to all personnel and trains its workforce in handling, etc

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table II.1

Version 1 June, 2004 Page 51

Rating of contractors' prequalification by a points scoring system (headings and item numbers refer to Appendix I)
A B C D

Personal protective equipment: Appendix I, Item 4(iv) Basic PPE provided to personnel but no corporate procedure for assessing individual needs PPE requirements formally assessed but little effort made to ensure correct usage PPE requirements formally assessed with spot checks on usage Procedures in place to assess all PPE requirements, monitor and enforce usage and replacement needs. Stock inventories monitored, kept above demand levels. Training in use provided where needed

Waste management: Appendix I, Item 4(v) Company has no formal methods for the control of waste Company has general procedures for waste disposal Company has procedures for the disposal of each of the main categories of site wastes but makes no provision for minimising environmental impact Company has a formal system for waste management (including identification and classification), which actively seeks to minimise environmental impact

Section 5: Planning, Standards and Procedures HSE or operations manuals : Appendix I, Item 5(i) No HSE procedures available Basic HSE procedures exist Contractor has written HSE procedures to cover all hazardous operations Contractor has procedures to cover all HSE precautions, typical contractor HSE Plan requirements with a system of updating and dissemination to employees

Equipment control and maintenance : Appendix I, Item 5(ii) No defined programme to identify or evaluate hazardous practices and equipment conditions Plan relies on outside sources, ie Group Company inspections. Supervisory inspection of equipment confined to worksite personnel only A written programme outlining supervisory guidelines, responsibilities, frequency and follow-up is in effect In addition to C periodic inspections conducted by top management or by teams of specialists

Standards : Appendix I, Items 5(iii) No HSE standards available Basic HSE standards exist Contractor has written HSE standards to cover all hazardous operations Contractor has a system of specifying, monitoring compliance and updating standards

Road Safety Management : Appendix I, Item 5(iv) No special attention paid to road safety as an area of hazardous activities Importance of road safety acknowledged but left to core business managers/supervisors to enact individually Company has a general management strategy with some procedures for its component issues Company has a complete strategy and set of plans and procedures covering vehicles, drivers and operations management

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table II.1

Version 1 June, 2004 Page 52

Rating of contractors' prequalification by a points scoring system (headings and item numbers refer to Appendix I)

Section 6: Implementation and Monitoring Management and performance monitoring of work activities : Appendix I, Items 6(i) and 6(ii) No system for formally monitoring HSE performance Performance monitoring in a few areas carried out Company has a system for monitoring HSE performance in key areas Company has a comprehensive system for monitoring performance in all areas with feedback to employers for improvement and has received awards for achievement

Statutory notifiable / dangerous occurrences and improvement requirements and prohibition notices: Appendix I, Items 6(iii) and 6(iv) More than one occurrence of major incident in last five years One occurrence of a major incident in the last five years Occurrences relate to minor incident(s) only No occurrences in the last five years

HSE Performance records (Latest year injury rate comparison to contractors three preceding years average) : Appendix I, Item 6(v) Contractor supplied insufficient information to establish rate or rate increases Rate is not improving Shows only minor rate improvement Rate steadily improving by more than 20 per cent per year

Criteria for absolute performance Rate over 200 per cent that of Group Company Rate under 200 per cent that of Group Company Rate under 120 per cent that of Group Company Rate better than that of Group Company

Incident Investigation and reporting : Appendix I, Item 6(vi) Findings not generally communicated Findings communicated to key personnel only via limited company internal memo or similar media Findings communicated to all employees via specific company notice As in C but with the addition of details of implication for improving HSE performance

Section 7: Audit and Review Auditing: Appendix I, Item 7(i) Audit process is cursory only - HSE documents are not explicit about auditing Company HSE documents include reference to auditing but there are no specific details about scheduling and coverage Company HSE documents include details of how auditing is to be implemented with schedules/coverage for the key areas As in C but additionally specifies management's role in audit and follow-up on action items

Section 8: HSE Management - Additional Features Membership of Associations : Appendix I, Items 8(i) and 8(ii) No memberships Company has membership of at least one association but with no prominence given to HSE Company is a member of at least one HSE association Company is an active participant in at least one HSE association

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 53

APPENDIX III: HSE RESPONSIBILITIES FOR GROUP COMPANY AND CONTRACTOR KEY PERSONNEL

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 54

APPENDIX III. HSE RESPONSIBILITIES FOR GROUP COMPANY AND CONTRACTOR KEY PERSONNEL GROUP COMPANY Contract Holder Conducting a structured HSE assessment of the anticipated contract HSE prequalification of contractors for the bidders list Preparation of the Contract HSE specification for inclusion in the tender documentation Preparation of an HSE monitoring programme defining the role of Group Company Representative(s) in ensuring that the contractor's HSE Plan is finalised and followed Preparation of Group Company audit and review programme and securing appropriate resourcing for this programme in consultation with Group Company management Evaluation of the contractor's HSE Plans in the contractor bids Ensuring the adequacy of the contractor's HSE Plan at contract award Appointment in writing of competent Group Company Representative(s) Supervision of Group Company Representative(s) Conducting a pre-execution HSE audit and authorising the contractor to commence work if the pre-execution HSE requirements have been met Monitoring the performance of the contractor against his HSE Plan Authorisation of deviations from the contractor's HSE Plan Application of sanctions in the event of unauthorised deviations from the contractor's HSE Plan Preparation of HSE close-out report. Making quality assurance checks on contractor's review and inspections and follow up Verifying that hazards and effects management controls as specified in the contractor's HSE Plan are implemented Identifying deficiencies against the contractor's HSE Plan and agreeing remedial action with contractor or instigating sanctions in consultation with Contract Holder.

Group Company Representative

Group Company Site Representative Where a contractor may be working in a number of areas it is common for a Group Company to nominate someone who is responsible for the supervision of the physical work being executed under the contract at a specific appointed site. The Site Representative's HSE responsibilities follow those of the Group Company Representative, but are specific to the site.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 55

Group Company HSE Adviser Where there is access to Group Company HSE advisers or specialists, it is important that the role of the adviser is understood to be indeed that of an adviser. Advice, support or services may be sought from an HSE Adviser on a routine or periodic basis but the responsibility for HSE matters on the contract must remain unmistakably with the assigned Contract Holder and representatives. Provide advice and support in HSE issues as requested Provide review/audit services as requested Provide additional advisory support, where needed, to small contractors.

In the case of a small local contractor a decision may have been taken to provide additional supervisory support and assistance in HSE matters. The Group Company HSE adviser may be tasked with providing support but must exercise care that this is recognised as a temporary phase and that the contractor must be encouraged to develop quickly to a point where such assistance is no longer required. CONTRACTOR Contract Manager Preparation and quality of contractor's HSE Plan Definition of competencies required for HSE critical positions Assignment of appropriate personnel to these positions Ensuring adequate resources and provision in the schedule to manage the contract in accordance with the contractor's HSE Plan Notifying the Contract Holder in writing of his nominated Contractor Representative(s) and Contractor Site Representative(s) Provision of the resources to implement remedial actions following audits in an expeditious manner. Fulfilling the pre-execution HSE requirements Implementing the contractor's HSE Plan Seeking formal approval from the Contract Holder for any proposed deviations from or amendments to the contractor's HSE Plan Implementation of any additional requirements imposed by the Contract Holder.

Contractor Representative

Contractor Site Representative Where a contractor may be working in a number of areas it is common for the contractor to appoint a person or persons to assume responsibility on behalf of the Contractor Representative for the activity of supervising the physical work being executed under the contract in the specific area. The HSE responsibilities are as for the Contractor Representative but with responsibility for a specific site.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 56

APPENDIX IV: HSE PLAN GUIDELINE FOR MAJOR CONTRACTS

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 57

APPENDIX IV

HSE PLAN GUIDELINE FOR MAJOR CONTRACTS

HSE Plan Definition Guideline This appendix provides headings and subject material that the Contract Holder should use as the basis for his contract document preparation to define the scope and requirements of a contractor's HSE Plan. It can be used to check both the coverage by the Group Company in the tender documents and the plans defined in response by the contractor in his bid. The following is a checklist of the principal headings with an expansion into key checklist items (Tables IV.1 to IV.7) given on the following pages under the respective headings. The detail included in tender documentation should be in keeping with the complexity of the contract and should additionally include prompts for specific action plans, target dates and action parties. A contractor familiar with the ADNOC Group Guideline HSE Management Systems [Ref 4] and who uses these as the basis for his management system will align immediately with these headings. HSE Management System (HSEMS) Element 1. Leadership and Commitment Element 2. Policy and Strategic Objectives HSE Policy Statement HSE Organisation HSE Professionals Subcontractors HSE Communications HSE meeting programme HSE promotion and awareness HSE competence requirements Employee orientation programme HSE training (general) HSE training (professionals) Methods and procedures for hazards and effects management Assessment of exposure of the workforce to hazards and effects Material data sheets for safe handling of chemicals Hazards and effects management and the assessment of PPE requirements Methods and procedures for waste management

Element 3. Organisation, Resources and Competence

Element 4. Risk Evaluation and Management

[4] ADNOC Group Guideline HSE Management Systems, January 2002.

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 58

Element 5. Planning, Standards and Procedures HSE standards HSE legislation HSE procedures Basic HSE rules Emergency response procedures HSE equipment and equipment HSE inspection Occupational health Environmental Road transport

Element 6. Implementation and Monitoring HSE performance - general Incident investigation

Element 7 & 8. Audit and Review HSE auditing

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 59

Detailed checklists for HSE Plan


Table IV.1 Checklist for HSE Plan: Section 1 Leadership and Commitment Checklist items Leadership and commitment Commitment to HSE aspects through leadership Senior management should engender commitment to HSE issues at all levels through their personal style of leadership and management. Key elements include: visible expressions of commitment by senior people HSE matters should be placed high on personal and collective agenda All senior managers should set a personal example to others. They should be, and seen to be actively involved in HSE matters, eg attendance at HSE meetings, personal instigation of HSE audits and reviews, etc. a feedback system should be established to encourage and facilitate employee feedback on HSE matters a positive culture should be promoted at all levels Checked

Table IV.2

Checklist for HSE Plan: Section 2 Policy and Strategic Objectives Written HSE policy Dated and signed by Chief Executive Policy statements: specific to individual parts of the contract (eg locations/sites/plants) cover specialised aspects (eg alcohol and drugs) consistent with Group Company standards and guidelines clear, concise and motivating

HSE policy statement General

Content

Importance of HSE as a contract objective Incidents and injuries are unacceptable HSE established as a line management responsibility Everyone is responsible for their own and their colleagues' HSE at work

Distribution/ availability

HSE policy distributed to all concerned, ie handed to each employee by their line manager when issued all new employees handed a copy by their line manager displayed on notice boards at each work location (worksites and offices) copies provided for each company on the contract (including subcontractors, suppliers and agents) available to Group Company and contractor employees in their working language(s)

Discussion

Policy and its implementation when issued discussed by line managers with each employee

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table IV.3

Version 1 June, 2004 Page 60

Checklist for HSE Plan: Section 3 Organisation, Resources and Competence Checklist items
Checked

HSE organisation Key personnel Personnel responsible for the implementation of HSE objectives clearly identified in an organisation chart Responsibility adequately covered during all phases of contract Job descriptions in place showing each team member's HSE competencies, responsibilities and function Organisation clearly shows position of HSE professionals Contract objectives/ accountability Defined to meet health, safety and environmental objectives as well as those of time, cost and quality Accountability for HSE success and equally of any failure clearly stated Focal point within the team structure ensuring that all HSE matters have been identified Designated team leader to produce HSE objectives, tasks and targets for the contract Targets, etc to be realistic and consistent Establish procedures for distribution, reporting and reviewing HSE issues Manning/ communication Manpower philosophy Manpower level to be defined correctly so as not to compromise HSE Effective means to communicate HSE issues between the Group Company, contractor and subcontractors Organisation staffed by competent personnel with sufficient appreciation of HSE where necessary with specific training in the issues involved Corporate structure/ responsibility Company's expectations on HSE management to be communicated in depth Access of contractor's line management to their corporate management structure on HSE issues to be defined Level of handling project HSE issues by the contractor corporate structure (middle or senior management or board level) In the contractor's corporate organisation, individuals charged with responsibility for HSE at middle senior manager or board member level Access to specialist HSE advice for line management, eg HSE professionals Job definition Role of the contractor's HSE advisers well defined Job definition drafted provision of HSE documentation for small contracts employment of HSE specialist for large contracts

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table IV.3

Version 1 June, 2004 Page 61

Checklist for HSE Plan: Section 3 Organisation, Resources and Competence (contd) Checklist items
Checked

Reporting/ follow-up

Reporting relationship with line management Direct access to the Chief Executive Does line management follow advice offered Contractor's HSE department involved in: preparing and monitoring departmental action plans formulation and suitability of HSE rules planned inspections and audits together with line management promotional material HSE training subcontractor assessment training and auditing health risk assessment, health performance monitoring and health surveillance environmental monitoring supporting incident investigation by line management

HSE department

Guidance given by the contractor's HSE management in preparing and implementing: Subcontractors Management To be well integrated and identified in contract HSE Plans With own plans if carrying out a large portion of the work HSE Plans to be vetted for suitability by main contractor Main contractor to communicate that subcontractor subject to the same rigorous HSE standards as main contractor Identification/ vetting Subcontractors to be identified at this stage of the project Method of vetting those still to be identified to be stated Vetting of past subcontractor records Maintenance of approved subcontractor lists where HSE has been considered operating and emergency manuals emergency plans training for firefighting teams, first-aiders, etc emergency drills and exercises protective equipment and rescue

Contact and liaison with government departments maintained

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table IV.3

Version 1 June, 2004 Page 62

Checklist for HSE Plan: Section 3 Organisation, Resources and Competence (contd) Checklist items
Checked

Coverage/ awareness

Set up appropriate lines of communication to handle HSE issues, eg such items as: direct access to emergency services nearest hospital helicopter availability air ambulance, etc

Authorisation and implementation procedures fully understood HSE communications Emergency services: those organisations that would be expected to provide support in a major incident aware of requirements Briefed as to their likely role Coverage/ awareness Set up appropriate lines of communication to handle HSE issues, eg such items as: direct access to emergency services nearest hospital helicopter availability air ambulance, etc

Authorisation and implementation procedures fully understood Emergency services: those organisations that would be expected to provide support in a major incident aware of requirements Briefed as to their likely role External links Lines established to communicate externally incidents that may endanger those on a site Government agency reporting procedures and the associated responsibilities of Group Companies and contractors Contractor able to communicate with all his workforce in an emergency Communications take into account the diversity of languages amongst the workforce Ability of base to mobilise in an emergency, eg doctors, hospital facilities Emergency communication Appropriate for incidents envisaged Strengthened, duplicated or backed up by other means Contractor to establish a regular schedule for HSE meetings Define responsible management person for scheduling such meetings Procedure to maintain records of personnel attendance

HSE meeting programme

Scheduling

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table IV.3

Version 1 June, 2004 Page 63

Checklist for HSE Plan: Section 3 Organisation, Resources and Competence (contd) Checklist items
Checked

Management participation

Managers seen to be involved by employees in: HSE activities, objective setting and monitoring taking action and providing resources to support their stated policies and objectives

Meeting structure

HSE meeting structure Effective to manage and communicate on HSE Allow employees full involvement and their own ideas to be heard Typical agenda and meeting formats

Follow-up actions

Meeting actions Where action is agreed, is it seen to be carried out? Where action is not agreed, is it explained why? Results of HSE activities, both successful and less successful, openly communicated to all employees Meeting programme consistent with the rest of the management structure to communicate effectively HSE issues Meetings recorded clearly and consistently Structured to differentiate between health, safety and environment

Communication

HSE promotion and awareness Techniques Appropriate communications techniques used to make the personnel aware of HSE issues How this is to be implemented, eg Performance Promotional methods personal contact interactive video notice-boards newsletters (suitable for large sites) bulletins posters

HSE performance boards (eg at worksite gates) Possibilities include: small 'give-aways' with the HSE message competitions suggestion schemes

Part of business Fitness of personnel

HSE activities seen as an intrinsic part of running an efficient business rather than a costly and time-consuming 'extra'

HSE Competence requirements Confirmation of medical fitness from recognised / approved medical facility of all employees proposed for contract

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table IV.3

Version 1 June, 2004 Page 64

Checklist for HSE Plan: Section 3 Organisation, Resources and Competence (contd) Checklist items
Checked

Employee orientation programme Approach Provision of a comprehensive handbook for all new employees On-the-job orientation for supervisory staff Established procedure in relation to follow-up of all new employees at the worksite New employees Accountability Adequately trained and confident of their own abilities Coached to improve their work practices rather than blamed for mistakes Employees know they are accountable for HSE performance Aware that their HSE performance is part of the contractor's appraisal and reward system Know that flagrant or frequent breaks of published HSE rules will result in disciplinary action Procedures Reappraisal Contract standards Established training programme Required for new employee orientation consistent with existing Group Company standards and guidelines Programme subject to appraisal and review Statement on the current standard of workforce and training requirements to meet contract standard Including: Established training programme HSE management job procedures road safety health (first-aid, health hazards, medical services, alcohol and drugs, health promotion, use of PPE) auditing incident investigation and reporting HSE adviser skills supervisory development environmental protection HSE management job procedures road safety health (first-aid, health hazards, medical services, alcohol and drugs, health promotion, use of PPE) auditing incident investigation and reporting HSE adviser skills supervisory development HSE meetings environmental protection

HSE training (general)

Including:

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table IV.3

Version 1 June, 2004 Page 65

Checklist for HSE Plan: Section 3 Organisation, Resources and Competence (contd) Checklist items
Checked

Supervisory training Formalised programme

Supervisory development training promotes man-management skills and communication skills Formal HSE orientation programme for employees working onsite Records kept of employees who have been through the programme Employees trained before starting work Training covers those joining as a contract is being implemented

Coverage

HSE training of employees coverage (including): safety fire and explosion road transport/driving first-aid work procedures/PTW hazard awareness and reporting occupational health security basic HSE rules legislative requirements environmental protection

Supervisors' participation Course content

Supervisors required to brief and debrief staff before and after training courses Effective system for establishing the need for and the content of training courses Determining course effectiveness and relevance of training assessed

Specialised training

Relevant training given to personnel prior to the execution of hazardous operations Training gained through course attendance supplemented by onthe-job training as necessary Records kept of attendees of the training courses and qualifications gained by employees

Emergency training HSE content in other courses

Training covers the actions to be implemented and the employees' responsibilities in an emergency HSE included in: induction courses craft training supervisory training line management training auditing techniques

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table IV.3

Version 1 June, 2004 Page 66

Checklist for HSE Plan: Section 3 Organisation, Resources and Competence (contd) Checklist items
Checked

HSE training (Professionals) Selection Procedure in place for introducing competent HSE personnel on to the contract Criteria used by the contractor to select his HSE supervisory staff (eg career development, professional status) Training Training is received by HSE professional Required specialisation (eg drilling, radiation, chemicals) Appropriate levels of: Qualifications Table IV.4 institute training HSE management match for competence for the job being carried out match for the advice required

Knowledge and experience of the contractor's HSE professional:

Checklist for HSE Plan: Section 4 Risk Evaluation and Management Checklist items Checked

Methods and procedures for hazards and effects management Coverage Group Company assessment used as a starting point with additional hazards identified by the contractor Contractor's assessment carried out in accordance with his formal methods and procedures Analysis techniques used in preliminary form where appropriate Contractor covers all parts of the contract with assessments for the specific scope and locations of the contract Experience and awareness Contractor able to use material from previous similar projects and demonstrate awareness from past experience

Assessment of exposure of workforce to hazards and effects Coverage Contractor develops assessment of the scope and degree of exposure of workforce to hazards from the hazards and effects management process

Handling of chemicals Coverage Contractor demonstrates availability and distribution of guidance/information on the safe handling of chemicals, likely to be encountered in the contract, and proposals for confirming adherence to guidance during contract All processes identified that require use of PPE Statutory requirements similarly identified Procedure in place for recording issue to personnel together with follow-up inspection and replacement/re-certification Storage of PPE adequate and secure with procedure for ensuring adequacy of stock

Hazards and effects management and the assessment of PPE requirements Hazard assessment/ PPE requirements

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table IV.4

Version 1 June, 2004 Page 67

Checklist for HSE Plan: Section 4 Risk Evaluation and Management (contd) Checklist items Checked

PPE instruction/ training Renewal/ replacement

Requirements identified for all personnel Instruction and training in its use provided where needed Procedure for checking its use been specified Schedule and criteria for renewing PPE Schedule for re-certification Responsibility for payment

Table IV.5

Checklist for HSE Plan: Section 5 Planning, Standards and Procedures Checklist items Checked

HSE standards Availability Contractor in possession of HSE manual/set of standards Identifying minimum criteria for achievement during contract implementation Available in writing to all users in consistent, concise and clear form Users involved in the development Standards in line with Group Company requirements Control/ authorisation Controlled documents Updated regularly Approval level indicated Procedure for obtaining deviations from standards Responsibility for authorisation Mechanism for recording approved deviations Coverage Clear reference to national and international standards Setting minimum requirements on health, safety and environmental issues HSE procedures Availability/ control Written procedures available to cover hazardous operations on HSE Include HSE precautions to be taken Consistent with Company standards and guidelines Controlled documents Appropriate level Coverage: include health and environment Written procedures: familiar to all employees including subcontractors available in their working language contents related to individual job descriptions

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table IV.5

Version 1 June, 2004 Page 68

Checklist for HSE Plan: Section 5 Planning, Standards and Procedures (contd) Checklist items Checked

Deviations

Procedure for obtaining Responsibility and level Recording of authorised deviations

Omissions

Identify whether there are any areas where procedures for hazardous operations are not drafted Commitment to prepare System in place If the contractor's own system is utilised, is it consistent with industry norms and in line with Group Company standards and guidelines? Training standards and qualifications set for personnel allowed to implement procedures

Permit to work (PTW)

Training/ qualification Basic HSE rules Availability

Set of rules available and distributed to all employees Users acknowledge receipt New employees given a copy before starting work Method of discussion and verifying understanding

Coverage

Covers health and environment as well as safety Set of rules provided tailored to specific contracts Identify hazards likely to be encountered Address basic housekeeping and hygiene Cover signals that will be encountered on site

Production/ updating

Structure for producing updating and disseminating rules Frequency Personnel participation Involvement of users

Coverage

Identification of potential major emergency scenarios, and procedures to use in such scenarios, eg fire and explosions evacuation and abandon rig/location storm oil/chemical spill aircraft incident emergency communications Medevac well control and blowout diving emergency man overboard and search and rescue (SAR) H 2S

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table IV.5

Version 1 June, 2004 Page 69

Checklist for HSE Plan: Section 5 Planning, Standards and Procedures (contd) Checklist items Checked

Emergency response procedures Potential use of Group Company standards and guidelines Awareness By employees of procedures Plans Orientation Schedule of drills and testing Medical contingency plan included Review frequency Responsibility of employees for own and colleagues' HSE Monitoring mechanism Drills to be carried out without warning

Contingency plans allowed for in emergency situations Recovery procedures in place to be activated in event of emergency scenarios Drills to be held to demonstrate preparedness for response

HSE equipment and equipment HSE inspection HSE equipment List drawn up of all HSE equipment to be used on the project Identified by type, capacity and reference to standards Requirements identified for each item of HSE equipment, including: Schedule registry classification licensing survey test certification

HSE equipment inspection schedule established for the duration of the project Inspection frequency clearly identified for critical items of plant

Occupational Health Facilities available Facilities defined as part of contract Occupational health programme established to: identify hazards assess hazards control hazards, eg engineering controls, procedural controls, vaccinations, etc maintain emergency procedures

Appropriate for the site conditions Welfare programme meets the needs of isolated sites

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table IV.5

Version 1 June, 2004 Page 70

Checklist for HSE Plan: Section 5 Planning, Standards and Procedures (contd) Checklist items Local medical facilities evaluated in detail to assess: range and quality of equipment and supplies hygiene standards administration procedures and standards transportation and communication Checked

Sufficient for day-to-day needs and consistent with relevant health programmes Adequate provision for supply of drugs, antidotes, etc Staffing Contingency plans Accommodation and catering facilities Availability of adequately trained, experienced staff Access to medical treatment facilities (if external) Defined for possible incidents beyond capability of site facilities Where provided, facilities to meet normally accepted standards of hygiene at site location Facilities to be operated in line with government hygiene Regulations and to meet Group Company standards and guidelines Rules in force to maintain cleanliness of site and other facilities Promotion Promotional material available to assist in maintaining standards Appropriate for the contractor's workforce in terms of: Hygiene and housekeeping Environmental Awareness Control Of the workforce to protect the environment whilst executing contract Identify potential environmental hazards Develop procedures for handling materials and performing operations that may damage the environment Contingency plans Aims Focus for the environmental protection team At what level Line management responsibility for environmental protection been defined as well as other job objectives Development and enhancement of environmental impact statements for the contract language clarity, etc

Procedure on on-site cleanliness and maintenance

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table IV.5

Version 1 June, 2004 Page 71

Checklist for HSE Plan: Section 5 Planning, Standards and Procedures (contd) Checklist items Checked Environmental monitoring to gauge the impact of operations Plans appropriate and sufficiently detailed Recovery and restoration of site after contract completion Environmental audits of operations during the contract Carried out by experienced individuals or companies

Monitoring/ restoration

Audits Road Transport Drivers : competence and selection

Assess physical, mental and psychological capability Character and background Qualities and experience, medical examination, document checks, driving tests Special skills such as terrain and climatic experience and firstaid knowledge

Driving Permits Driver induction Driver training

Should record personal and employment details, types of vehicle licensed to drive and types of cargo licensed to carry Local area characteristics and regulations This should test vehicle operation and use, operating conditions (terrain, climate), off-loading and positioning, emergency situations, and vehicle inspection Techniques should identify deficiencies, analyse causes and select appropriate retraining Ensure correct type, capacity and size for facilities Good manoeuvrability and serviceability The job description should be clearly defined before the vehicle is chosen, to ensure work operations do not exceed the manufacturer's specifications Safety equipment and communications on board the vehicle need to be checked

Driver improvement Vehicle selection Vehicle specification

Passengers Freight Vehicle maintenance Ops management need and approval Ops management journey routing and scheduling Journey management

Is the vehicle designed to carry passengers? Design of vehicle and load limits Segregation, positioning and securing of freight Conducted on a regular basis Define the journey and justify the need Awareness of hazards involved Allocation of vehicles, written authorisation, verification of employees' driving standards Full awareness of route (hazards, conditions) Realistic schedules Logging of actions

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table IV.5

Version 1 June, 2004 Page 72

Checklist for HSE Plan: Section 5 Planning, Standards and Procedures (contd) Checklist items Checked Roles and responsibilities defined for management, supervisors, drivers, passengers Prequalification of contractors and contractor HSE management treating road transport with equal importance to main activity Standards for scope of operations included in tender operation Control and review mechanisms included in contracts Policy of no subcontracting without written authority

Roles and responsibilities Contracting

Procedures Emergency services Table IV.6

Ensure procedures are in place for all transport operations Monitor and review mechanisms in place In place and tested

Checklist for HSE Plan: Section 6 Implementation and Monitoring

HSE performance General Measurement Proposed plan to measure performance, ie Feedback/ analysis performance indicators progress against targets HSE initiatives/incentive schemes achievement of milestones numbers and types of training courses numbers and results of audits clearance of action items LTIF/TRCF Numbers of first-aid and minor injuries material losses vehicle incidents spillages occupational illnesses sickness absenteeism

Use will be made of reactive statistical indicators, eg

Availability and use of performance records Feedback/review/discussion at HSE meetings Presentation and distribution to employees Comparison of performance With other similar contract work Frequency Involvement of Group Company personnel

Comparison of performance

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table IV.6

Version 1 June, 2004 Page 73

Checklist for HSE Plan: Section 6 Implementation and Monitoring (contd) Checklist items Checked

Incident Investigation Coverage Reporting procedure for the contract Covering not only injuries to and time lost by personnel but also: Methods health incidents (diseases, exposures to hazardous substances, near misses, etc) environmental incidents (spillages, releases, contamination, etc) other safety incidents (safety equipment failures, loss of capital equipment) material loss

HSE performance General Incident investigation method established to determine and correct causes Incidents first reported to the direct supervisor Incident investigation teams led by the relevant managers Differentiation made between numbers of first-aid treatments and other minor injuries Procedure in place on vehicle incidents Methods to be used for collecting incident statistics Availability Table IV.7 Established HSE procedure outlining responsibilities, frequency, methods and follow-up Checklist for HSE Plan: Section 7 Audit and Review Checklist items HSE auditing Scope Compliance with the HSE Plan including: Coverage HSE management departmental personnel HSE technical personnel HSE subcontractor occupational health unsafe acts audit training environmental own activities and those of his subcontractors Checked

Consistent with Group Company standards and guidelines Schedule for full contract duration Involvement of personnel in audit teams from outside the location Carried out by a wide cross-section of the workforce including Group Company and subcontractor personnel

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table IV.7 Checklist for HSE Plan: Section 7 Audit and Review (contd) Checklist items Effectiveness How verified Involvement of the contractor's corporate management in review of findings Intention to publish findings Discussion with personnel on contract and at HSE meetings Lessons used to improve operations across the contract Follow-up Any numerical treatment made of findings Frequency of review of implementation progress Rejections of audit findings properly authorised and documented

Version 1 June, 2004 Page 74

Checked

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 75

APPENDIX V. HSE PLAN GUIDELINE FOR SMALL CONTRACTS

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 76

APPENDIX V.

HSE PLAN GUIDELINE FOR SMALL CONTRACTS

HSE Plan Definition Guideline This provides headings and subject material that the Contract Holder should use as a basis for his contract document preparation to define the scope and requirements of a contractor's HSE Plan. It can be used to check both the coverage by the Group Company in the tender documents and the plans defined in response by the contractor in his bid. The following provides a series of checklist items under the normal HSE MS headings.
Table V.1 Checklist for HSE Plan Checklist items Leadership and commitment Policy and Strategic Objectives Organisation, Resources, and Competence Senior management should reinforce the importance of HSE at all levels in the organisation and should be seen to be setting a personal example. Contractor has a policy which makes reference to the importance of HSE. It is formalised by the Chief Executive's or the Manager's signature. A focal point in the organisation for HSE. Simple procedure for distributing information on HSE issues to the workforce. A procedure for determining/enacting HSE training. Provision for obtaining HSE advice should this be outside the capability of the contractor's personnel. Simple procedure for ensuring any subcontractor adheres to same HSE standards. Simple advice on the importance of the links with client (or third party) emergency services on contracts. Typical agenda for any HSE items in meetings and how to ensure they are covered effectively. A statement of how HSE competence is assessed for personnel with HSE-critical activities to perform. Statement of requirements for employees to indicate that they have the necessary appreciation of the HSE issues in the contractor's business activities. This should include reference to potential client HSE induction sessions and HSE training. Such training could include items from the following list (as relevant to the contract): fire and explosion hazards road transport/driving first-aid work procedures/PTW hazard awareness and reporting security basic HSE rules Checked

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04 Table V.1 Checklist for HSE Plan (continued) Checklist items Risk Evaluation and Management Planning, Standards and Procedures legislative requirements occupational health environmental protection HSE targets set in clear quantifiable terms a system in place to assess workplace hazards

Version 1 June, 2004 Page 77

Checked

Contractor has a document with simple procedures/rules covering the HSE issues in his business activities with a method for review and update. This should include the following: HSE hazard awareness Basic HSE precautions to be observed in the workplace HSE hazards of tasks and operations encountered in his business HSE hazards of equipment used Use of PTW system Communications with supervisory personnel on site outlines the activities of his business identifies those areas that are HSE-critical finds a method how individual contract scopes can be simply appraised to determine where the attention to HSE issues need to be focused identifies how to determine PPE requirements identifies a simple set of steps for road transport management

Contractor has a document that:

Implementation and Monitoring

Contractor has a procedure for recording incidents, for advising legislative bodies where necessary and for making annual reviews of performance. Contractor has a procedure for investigating incidents. Contractor has a method for the management to carry out simple audits of his contract operations.

Audit and Review

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 78

Small Contract Typical HSE Plan Proforma This provides guidance for a set of headings for a typical HSE Plan for use on small contracts. The list of headings should be determined individually for the contract concerned.
Table V.2 Category GENERAL ADNOC Group Company Project Contract Title/Number Contractor details Site location Group Company Contract Holder/ Representative(s) Group Company Representative(s) Contract Manager/Contractor Representative(s) HAZARD ASSESSMENT Contract scope description Expected hazards identified (including adjacent operations, etc) Alternatives considered Procedures to be followed for hazard control (list documents or describe details here) Access/escape provisions (alarms, muster stations, etc) Emergency service provisions (including first-aid, nearest medical treatment, emergency phone numbers, etc) Competence standards for contractor's personnel Standards for contractor's equipment Training requirements (including site HSE induction) JOB/SERVICES DESCRIPTION Contractor's personnel assigned Contractor's equipment/consumables/services assigned Small contract typical HSE Plan proforma Item Details

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 79

Category

Item Group Company's personnel assigned Group Company's equipment/consumables/ services assigned Subcontractor details Responsibilities/interfaces defined PPE and any special HSE equipment to be used Working hours/job duration Site description/limits PTW provisions applicable Conditions for suspending work (eg weather, adjacent site operations, etc)

Details

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 80

APPENDIX VI CONTRACT EXECUTION HSE AUDIT GUIDELINES

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 81

APPENDIX VI
Table VI.1

CONTRACT EXECUTION HSE AUDIT GUIDELINES

Heading checklist for contract execution audits Checklist item Checked

Section 1: Leadership and Commitment Commitment Is there a feedback system to monitor reports/comments from the workforce? Are senior managers personally involved in HSE meetings and audits? Section 2: Policy and Strategic Objectives Policy Distributed/available to all employees on contract particularly new personnel and including subcontractors, buyers and agents, in their working languages Displayed on notice-boards at each work location Policy explains how further information should be obtained Implementation discussed by line managers with each employee as part of induction Supervisors and managers actively involved in implementing policy (eg via unannounced site HSE tours, investigation of incidents) Revisions brought to attention of all employees Section 3: Organisation, Resources and Competence HSE organisation Key personnel executing their responsibilities and job functions Line management responsibility for HSE being enforced Contract objectives being achieved Manpower levels sufficient so as not to compromise HSE issues Staffing by competent personnel, with training where necessary Contractor's corporate management actively involved in HSE as well as other contract aspects Subcontractors Only approved subcontractors identified in contract being used Subcontractor HSE Plans where identified in contract, being monitored by main contractor Liaison between contractor and subcontractors including discussion of HSE issues HSE communications Lines of communication to handle HSE issues in place and functioning Emergency services External links Back-up facilities provided where needed

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 82

Table VI.1

Heading checklist for contract execution audits (continued) Checklist items Meetings being held in accordance with contract schedule with management involvement targeting objectives Meeting structure encouraging employee participation Follow-up actions being cleared Communications being documented correctly Checked

Employee orientation programme

Handbook issue to all new employees On-the-job orientation taking place New employees being selected on basis of competency and are adequately trained Employees to be aware of importance of accountability rather than blaming culture Programme subject to appraisal and review

HSE promotion and awareness

Communications for promotion being actively used Policy posted prominently Promotional methods used where appropriate Recruitment standards being maintained Training programme in place for all areas identified in contract Briefing and debriefing of workforce by supervisors before and after training courses Course content being monitored to determine effectiveness and relevance Course training being supplemented by on-the-job training where needed Proper records being kept HSE being addressed in other courses such as induction, craft training, supervisory, line management , auditing

HSE training programme

HSE professionals

Use of competent personnel, adequately qualified, with correct training including, where necessary, specialised training Reporting relationship with line management in place and effective Active involvement of HSE department in support of the contract

Legislation and standards

Available to all relevant personnel - nominated representative charged with keeping legislation, standards, procedures, rules up to date. Documentation produced where omissions previously identified Statutory requirements being observed

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 83

Table VI.1

Heading checklist for contract execution audits (continued) Checklist items Checked

Section 4: Risk Evaluation and Management The workplace For such examples as working in confined spaces, working at heights, working over water, HSE in offices, site workshops, working near overhead and underground services, traffic routing, working in adverse weather Access method selection, scaffolding, mobile platforms, etc, ladders and staging For such examples as fork-lift trucks, excavators, abrasive wheels, portable tools, hand tools, etc For such examples as demolition, excavations, lifting operations, materials handling, formwork, erection of structures, welding, piling, high pressure water jetting, grit blasting, stressing operations For such examples as electricity, compressed air, steam, fuels, etc For such examples as dust, fumes, smoke, asbestos, H2S, PCBs, radioactive sources Availability of PPE for the hazards of the job In adequate quantities and to the required standards Procedures being followed for recording issue to personnel with follow-up inspection and replacement where defective Secure storage available Training in PPE use provided Section 5: Planning, Standards and Procedures Legislation and standards Available to all relevant personnel - nominated representative charged with keeping legislation, standards, procedures, rules up to date. Documentation produced where omissions previously identified Statutory requirements being observed Emergency response procedures HSE Procedures HSE equipment and equipment HSE inspection Awareness and practice of all drills in accordance with contract schedules with feedback of results and recommendations for improvement PTW system in place and working effectively HSE equipment identified in contract provided on site and to the required standards Inspection being carried out on all critical items according to schedule

Access to the workplace Working with plant and equipment Tasks and operations

Working with services and consumables Working with hazardous substances PPE

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 84

Table VI.1

Heading checklist for contract execution audits (continued) Checklist items Potentially hazardous equipment targeted including: compressed air tools electricity portable tools mechanical plant rotating machinery vehicles maintenance of all equipment Checked

Occupational health and welfare Hygiene and housekeeping

Facilities defined in contract in place and operating effectively with staffing by adequately trained personnel and with access to medical staff by all employees Contingency plans in place and tested Site cleanliness and maintenance being observed with management instrumental in keeping adequate standards Accommodation and catering facilities meeting the required standards Promotional material being used to assist in maintaining standards

Environmental

Monitoring and protective measures in place and being followed Contingency plans in place and tested Focus on environmental as well as other job issues.

Section 6: Implementation and Monitoring HSE performance Use of proposed plan to measure performance Achievements of milestones Numbers and results of audits Clearance of action items Potential use of TRIPOD technique to measure performance - feedback of results and discussion at HSE meetings Performance on environmental protection and health issues Incident investigation and reporting All forms of incidents being investigated promptly, health and environment as well as safety Incident investigation method being followed with relevant managers taking a lead Root causes being pursued Results communicated to employees and where appropriate subcontractors and other parties Improvement in performance being targeted Statistics being collected

HSE MANAGEMENT CODES OF PRACTICE Volume 1: HSE ADMINISTRATION COP G/L: MANAGEMENT OF CONTRACTOR HSE Document No: ADNOC-COPV1-04

Version 1 June, 2004 Page 85

Table VI.1

Heading checklist for contract execution audits (continued) Checklist items Checked

Section 7: Audit and Review Auditing Being carried out in accordance with schedule in contract, with the correct personnel (including management involvement), review of findings and the necessary follow-up and clearance of action items