Steps for the Procurement of Piping / Mechanical items

As piping constitutes a major chunk of any refinery, chemical, petrochemical, power

generating industries there is always need of purchasing various piping and
mechanical items. There must be an approved procurement procedure for smooth
functioning of this process and receiving items in the construction site without much
delay. In this article, We will explore the major Steps involved during the
Procurement/Purchase Process of piping/mechanical items for the Oil and Gas
Industry.

Many types of equipment and items need to be purchased in the piping project from different
vendors/suppliers. Before finalization of the
vendor/ supplier to get the pipe material, there are many phases/ steps which need to be
followed as mentioned below:

In the first step, an inquiry specification (normally specifications specifies all

technical requirements, preliminary drawings, quality requirements, etc.) for the
required equipment/item is floated to several different vendors to get a techno-
commercial quotation. Normally each company has a list of approved vendors. The
inquiry is generally sent to the approved vendors/ suppliers. In case the item is not
available with the approved vendors then other vendors are requested to go through
the approval procedure and they are included in the approved vendor list.

Based on the specification mentioned in the purchase requisition (PR) Vendors

prepare an offer and sends it. After receiving offers from the different
vendors/suppliers, each offer is checked and evaluated from a technical viewpoint
first and then cost point. If there are any changes/deviations or if there are points
which the vendor has not confirmed, it has to be clarified through technical
queries/TQ. This process may take a few days to complete.

After receiving the replies of all the technical queries and the deviation request from
the suppliers the originating engineer will decide if the vendor is technically suitable
for that particular inquiry. He may select several vendors as suitable based on
technical and qualitative requirements.

Specification engineer than populates the replies of all the vendors/suppliers in a

common document (normally in an excel sheet) which is called the technical bid
analysis (TBA)/ evaluation (TBE) report. This document will show the major/impact
points of the particular inquiry along with the replies from all the vendors/suppliers.
If there are any deviations they are mentioned against applicable points in the
TBA/TBE. In the TBA/TBE Specification engineer has to give a technical acceptance or
rejection of each vendor/supplier in the inquiry. This TBA/TBE report is then
forwarded to the projects/procurement/purchase department for further action at
their end.
After receiving the TBA/TBE, the projects/procurement departments then evaluate the
technically accepted vendor for commercial and delivery schedules. The vendor/supplier
which is acceptable in technical, commercial, and delivery schedule terms are given the
purchase order (PO).

After the purchase order (PO) has been placed/initiated with a vendor then the selected
supplier sends the final drawing and documentation for review and approval. The originating
engineer will review the drawing and documentation along with the datasheet and the inquiry
specifications send to and agreed by the vendor/supplier. If there are any comments or any
points which need to be added on the vendor drawing than the engineer can mark it up in the
drawing or document and send it back to vendor/supplier for incorporation. Once all the
comments are been taken care of, then the drawing and the document can be accepted.

Once the drawing is accepted the materials go into the fabrication shop and they are
prepared ready for inspection. Inspection is carried out as mentioned in the
datasheet/inquiry specification.

After the inspection, the material is then ready for dispatch to the site location as per
schedule. Along with the item, the vendor has to send all quality and test reports. All
ordered items normally bear a warranty of at least one-year successful operation
after installation.

What is Inch Dia ?

In construction projects Inch Dia unit of Measure is used to measure the progress of
Piping Spool fabrication. The weld joint of the pipe size is converted to the equivalent
inch dia of welding. Examples: 
1. One welding joint of 8 inch diameter pipe = 8 Inch Dia
2. Two welding joints of 12 inch diameter pipe = 24 Inch Dia

What is Inch Meter?

In construction projects Inch Meter unit of Measure is used to measure the progress of
Piping Erection and Hydrotesting. The length of pipe erected or hydrotested of the
pipe size is converted to the equivalent inch Meter of erection or hydrotesting.
Examples:
1. 10 Meter of 8 inch diameter pipe Erected or Hydrotested = 80 Inch Meter
2. 12 Meter of 6 inch diameter pipe Erected or Hydrotested = 72 Inch Meter.