Technical & Commercial Contract To Provide Powerstation Management System (Psms

PSMS – PT Newmont, Lombok, Indonesia
PSMS – NEW - 0403
Technical & Commercial Contract to Provide

PowerStation Management System (PSMS)
for
PT Newmont
Lombok, Indonesia
Ref # PSMS-NEW-0403
April 22, 2003
Operation Technology, Inc.

23692 Birtcher Drive,
Lake Forest, California, USA 92630
Operation Technology, Inc. -1- Revision 1

PSMS – NEW - 0403
TABLE OF CONTENTS
1 GENERAL...................................................................................................................3
2 PHASE I - PSMS ENGINEERING.............................................................................3
3 PHASE I - SCOPE OF DELIVERABLES.................................................................7
4 PHASE II - PSMS INSTALLATION & INTEGRATION.........................................7
5 PHASE II - SCOPE OF DELIVERABLES..............................................................10
6 PHASE III – LOAD SHEDDING INSTALLATION AND INTEGRATION.........11
7 PHASE III - SCOPE OF DELIVERABLES.............................................................16
8 CLIENT’S RESPONSIBILITIES.............................................................................16
9 USER SUPPORT.......................................................................................................17
10 STANDARDS..........................................................................................................18
11 PROJECT IMPLEMENTATION.............................................................................18
12 CONSIDERATION & PAYMENT SCHEDULE....................................................19
13 PSMS HARDWARE (May be Provided by Client).................................................22
14 LOAD SHEDDING HARDWARE..........................................................................23
15 LIABILITY...............................................................................................................23
Attachment A: Package List and Description

Attachment B: Hardware Specification
Attachment C: Product Description
Attachment D: License Grant & Agreement
Attachment E: Preliminary Achitecture
ETAP and PowerStation Management System (PSMS) are trademarks of Operation Technology, Inc.
Windows, Windows 2000, Windows XP, and Excel are trademarks of Microsoft Corporation.
2003 Operation Technology, Inc. All rights reserved.

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1 GENERAL
This document presents technical specifications and commercial scope of work for
providing a power management system to PT Newmont, Indonesia hereafter
referred as Client.
ETAP PowerStation Management System (PSMS) offers advanced modules with

the flexibility of several package options. ETAP PSMS provides the following
main features:
i) Advanced monitoring system. The monitoring system will process the data,
reset the alarms, store all parameters and graphically display data on graphic
one-line diagrams in continuous mode.
ii) Real-time simulation capabilities.
iii) System analysis capabilities.
iv) Offline simulation capabilities and Event Playback using archived data.
v) Capability to allow for future system expansion.
vi) Automatic implementation of recommended settings to achieve continuous
optimum system operation.
vii) Operator controlled implementation of recommended settings to achieve
continuous optimum system operation.
viii) Intelligent Load Shedding and Load Preservation.
ix) Continuous scrolling display of data allowing Load Trending.
The proposed system (combination of all three phases) is the PSMS Imperious
package + Intelligent Load Shedding, which will interface with the plant’s
electrical data acquisition/metering system.
The project implementation is broken down into three phases each having
predefined milestones. Phase I covers the engineering associated with preparing
the ETAP PowerStation model for online applications. Phase II covers PSMS
integration for the online model for PSMS with the exception of online control and
load shedding. Phase III covers integration of PSMS for online control and load
shedding.
2 PHASE I - PSMS ENGINEERING
OTI will appoint a “Project Manager” who shall be responsible for its obligations
throughout the project implementation. OTI’s Project Manager will perform or
have others perform the following engineering services.
2.1 Kick-off Meeting

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2.1.1 Kick-off meeting will be arranged to answer questions, request

additional data, and review existing hardware & site design to
coordinate the various aspects of the project. To minimize costs, this
meeting can be held remotely via teleconference, email, Webex, or
other means.
2.2 Data Collection
2.2.1 All existing and available system data should be provided to OTI at
the front-end of the project. This data includes:
 The latest ETAP model for the system.

 List of metering points and the electrical parameters read from the
field meters along with the set points.
 Several sample sets of meter data from along with breaker /
switch status and metering tags in the system for different system
scenarios.
2.2.2 Data collection will be performed by Client. OTI will submit a list of
required data to Client at the start of the project and Client shall be
responsible for collection of all data. All required system data should
be forwarded to OTI at the front-end of the project. The data should
include:
 One-line diagrams
 Equipment ratings
 Protective device models/types
 Generators’ governor and exciter models along with their
respective parameters
 Generators Load Acceptance and Load rejection test data under
50% and 100% loading
 MV motors’ dynamic models along with load slip versus torque
curves
 Historical system disturbance records including type and location
of disturbances and their impacts on the system operation.
 Other pertinent information describing system apparatus
 Existing system study reports
2.2.3 OTI will utilize existing dynamic models for all synchronous
machines. If models are not available, there will be an additional
charge to build the dynamic model(s).
2.2.4 Client will provide all existing and planned relay settings to OTI.

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2.3 System Modeling
2.3.1 Client will provide the system model which will be taken online using
ETAP PSMS in Phase II of the project. The scope of work includes
the 150 kV to 3.3 kV system. The network downstream from that
point would be considered as unmonitored loads. Any additional
modeling below 3.3 kV by OTI would be in the form of lumped
loads. The scope can be expanded at a later date to include detailed
modeling and monitoring of low voltage feeders.
2.3.2 The existing ETAP model will be expanded to include metering

devices, which will interface, with the field meters.
2.4 Visibility Study & Data Acquisition
2.4.1 Review plant metering instruments & locations and suggest any
additional instrumentation that may improve plant monitoring.
2.4.2 Perform a plant visibility study to identify required measurement

points and their optimum location for accurate State and Load
Estimation (SLE) calculations.
2.4.3 A list of all required metering points and required parameters will be
forwarded to the Client upon completion of the visibility studies by
OTI. Client’s representatives shall be assigned to this project for
collection of all required data.
2.5 Evaluation & Validation
2.5.1 Perform model validation studies for steady-state operations.
2.5.2 Power monitoring and control hardware evaluation.
2.5.3 System studies for steady-state operations.
2.5.4 Tag determination and location for steady-state operations.
2.6 Communication Hardware Architecture for PSMS Integration
2.6.1 Based upon the Visibility studies and system evaluation, OTI will
develop a detailed system architecture drawing for the installation of
GE Universal Relays for the purpose of monitoring and load shedding
within PSMS. (Not to exceed 20 GE Universal Relays.)

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2.6.2 OTI will review the plan of action developed by the Client prior to
actions taken to implement replacement of GE SR750 and SR760
Relays with the installation and commissioning of the GE Universal
Relays.
2.6.3 OTI will recommend any changes to the course of action for the
installation and commissioning of the above communication
hardware.
OTI’s scope of involvement with the installation and commissioning of the GE

Universal Relays is purely on a recommendation and review basis. OTI assumes no
liability, directly or otherwise, for the actual installation and implementation of the
process. The scope of the proposal estimates the need for fourteen GE Universal
Relays, with a not to exceed of twenty GE Universal Relays.
2.7 Transient Stability and Load Shedding Studies
2.7.1 Transient Stability analysis will be performed to investigate the

stability limits of a power system before, during and after system
changes and disturbances. The program models dynamic
characteristics of a power system, implements the user-defined events
and actions, solves the system network equation and machine
differential equations interactively to find out system and machine
responses in time domain. From these responses, it is possible to
determine the system transient behavior, make stability assessment,
find protective device settings, and apply the necessary remedy or
enhancement to improve the system stability.
2.7.2 Results of the Transient Stability analysis will enable OTI to clearly
outline the load shedding hardware requirements. Based on OTI’s
recommendation, the client will install and commission the necessary
load shedding hardware. OTI will provide an option at the end of this
proposal to provide turnkey installation and commissioning of the
load shedding hardware.
2.7.3 Preliminary load shedding study will be performed along with the
stability studies per the following:
 Evaluate system protection scheme settings
 Evaluate plant historical disturbance records
 Identification and validation of system parameters.
 Design system transient stability limit study cases
 Perform transient stability limit assessment based on the study
results
 Run study cases to verify and fine tune the optimal and
achievable stability limits

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 Perform strategic load-shedding schedule protection design

 Evaluate and recommend load-shedding hardware
implementation scheme
3 PHASE I - SCOPE OF DELIVERABLES
3.1 Client will receive an updated ETAP model of the system per the
Engineering Services mentioned in Section 2 of this proposal.
3.2 Client will receive a recommendation from OTI for additional hardware
needed to perform system monitoring and load shedding.
4 PHASE II - PSMS INSTALLATION & INTEGRATION

Phase II may begin prior to the completion of Phase I, relying upon the completion
of the at least the data collection and visibility study milestones in Phase I.
4.1 Purchase PSMS Imperious (except Online Control)
4.1.1 PSMS Server Software

 500 Tag Interface
 500 Bus Simulation Capabilities
 PC-Based, Windows 2000
 OPC Interface
 Client-Server Architecture
 Multi-Console Capability
 User Access Management
 ODBC Format
4.1.2 PSMS Consoles

 One Primary Console
4.1.3 Advanced Monitoring

 Base Modules
 Continuous Real-Time Monitoring
 On Demand Data Retrieval
 State Estimator and Load Distributor
 Data Reconciliation and Consistency Check
 Bad Data Detection and Correction
 Alarm Management and Processing
 Energy Cost Monitoring
4.1.4 Real-Time Simulator

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 Load Flow
 Short Circuit
 Motor Starting
 Harmonic Analysis
 Transient Stability
4.1.5 Event Playback

 Sequence of Event Recorder (Seconds-based)
 Playback Server
 Playback Historian
4.2 PSMS Server and Console Hardware
4.2.1 Client has the option of purchasing the hardware for PSMS Server
and Console locally or OTI can provide the hardware (PCs) to Client.
If Client chooses to use existing PC’s for PSMS Server and Console,
they should meet the PSMS minimum hardware requirements (See
Attachment B). The PSMS Server needs to be delivered to OTI in
California for use in the Factory Acceptance Test.
4.3 Data Collection
4.3.1 Client will provide OTI will several sample sets of real-time data for
validation of the online PSMS model.
4.4 Tag Database Creation
4.4.1 Compile a tag cross-reference list that references the field device tag
names and characteristics to those used by PSMS. This tag database
would be created and used for online model validation.
4.5 Model Validation
4.5.1 OTI will validate the model for online operation. Online model
validation is the most important part of this phase. The validation
process involves comparing the metered data provided by Client with
the State Estimation results. Discrepancies are usually found in the
two results indicating inaccuracies of the offline model with respect
to the real system. One benefit of Phase II is to obtain a more accurate
model of the system, which Client can utilize for online applications
as well as accurate offline studies. Any deviations found during this
study would be listed and this list would be provided to Client for
field verification.

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4.5.2 OTI will modify meter locations in the ETAP model based upon the
results of the above validation.
4.6 Factory Acceptance Test
4.6.1 Conduct a one-day Factory Acceptance Test (FAT) in OTI’s,

California R&D office. This test is done for the purpose of
establishing that the design and functional operation of the complete
system conforms to the specified requirements.
4.7 PSMS interface
4.7.1 Communication interface to PSMS Server/Console(s) will be via

OLE for Process Control (OPC) protocol. An OPC Server will be
used to communicate with the monitoring and control equipment.
Communication to the select hardware to perform load shedding will
be done in phase III of this project.
4.8 Install and Setup PSMS
4.8.1 OTI will install and commission, the PSMS Server, PSMS Console,
Playback Server, OPC Server, Watch windows and real-time
simulation at the site. The installation and commissioning will be
used as an opportunity to train site staff on the setup of PSMS.
4.8.2 Engineering assistance for the system integration phase of the project
will include installation, setup and configuration of PSMS only. One
five-day trip to the site is required by one OTI engineer to perform
PSMS installation and integration.
4.8.3 Deliver PSMS User Guide to the plant that describes the operation of
PSMS.
4.9 Site Acceptance Test (SAT), PSMS Imperious except Online Control
4.9.1 A five-day trip to the site by one OTI engineer is required to perform
SAT. The PSMS Site Acceptance Test will be conducted at the
Client facility to validate the PSMS model with real time data and
verify connectivity to all assigned tags via the input tag table. PSMS
will be confirmed on the primary console, and tested for functionality
based on SAT guideline. The SAT is designed to determine the
accuracy of the PSMS performance.

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4.9.2 Upon a successful SAT, the Client’s Project Manager shall “sign off”
on the SAT results and the project shall move into the initial period of
Maintenance Contract Services as described in PSMS License Grant
& Agreement.
4.9.3 However, if any the above SAT does not pass OTI Project Manager
may request a “retest”. For the subsequent test(s), OTI’s Project
Manager is not required to be present at the plant site. The Project
Managers shall decide collectively to base the subsequent test upon
either the same plant operating data from the previous SAT or new
real time plant operating data.
4.9.4 The SAT shall include a checklist for the Client’s Project Manager to
sign that indicates that interface screens meet the original scope
specifications and that PSMS shall perform all purchased functions
described within the users’ manuals.
4.9.5 OTI will prepare the necessary test procedures. Columns shall be
provided so that the nominated testers can formally sign that the test
is complete and satisfactory.
4.10 Training
OTI provides one five-day on-site Introductory Training course on PSMS: A
maximum of 10 engineers/operators will attend the training course. Training
materials are included in the price. The customer is responsible for providing
a computer for each student to use during the training. All travel expenses
incurred by OTI in the performance of the training, such as the cost for air
tickets, travel days, local transportation, lodging, and expenses shall be
reimbursed at actual cost and will be invoiced per occurrence.
5 PHASE II - SCOPE OF DELIVERABLES

OTI will provide and deliver the following hardware, software and documentation,
contingent upon Client executing the standard Software License & Services
Agreement for PSMS.
5.1 One PSMS Server and One Console software. (Includes Playback Server)
5.2 One OPC server software.
5.3 Engineering Services per Section 4 of this proposal.
5.4 One PSMS User Guide / Operating Manual.
5.5 PSMS Onsite Training
Operation Technology, Inc. - 10 - Revision 1

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5.6 If applicable (optional as part of the order), OTI will provide One PSMS
Server PC and One PSMS Console PC’s with hardware requirements
matching Attachment B.
6 PHASE III – LOAD SHEDDING INSTALLATION AND INTEGRATION
6.1 Load Preservation System

The proposed dynamic Load Preservation System through PSMS allows for
optimum load shedding. This system is a combination of PSMS logic and
IED (PLC or UR Relay) programming where PSMS will download a
dynamic load shed priority list to the IED’s. This scheme considers a non-
traditional approach where a strategically devised load shedding is
determined using PSMS. The major advantage of this scheme is that it goes
beyond the classical load shedding schemes (such as using relay frequency or
breaker interlock) by prolonging the system CCT (critical clearing time), thus
improving the system stability margins with minimal load rejection. This is
achieved by constructing a Stability Knowledge Base (SKB) for the system
for various operating configurations and loading/ generation conditions.
Based on the SKB and Load Priority Tables (LPT) along with the on-line
parameters collected from the system (as defined by the Visibility study),
PSMS reacts in a fraction of the time than the conventional method of using
frequency relays. This is achieved since PSMS anticipates the system
reaction to a given disturbance (location, magnitude etc.) based on the SKB
and initiate the appropriate actions way before a frequency relay even detects
a change (df/dt).
This scheme requires transient system analysis on the system model to be

performed for all applicable (operating) configuration and loading/generation
conditions including any plant specific set up prior to implementation. The
other conventional methods (frequency relay) are used with this scheme as a
back up protection.
6.2 Load Shedding System

A Load Shedding Scheme can be implemented to monitor the status of the
plant such that on tripping of a power source, the lower priority loads can be
immediately shed. The priorities can be simple or complex depending upon
the decision of the plant operation departments.
To generate the appropriate sequences including islanding and load
balancing/shedding, the collected data from the IED’s shall be modeled in the
PSMS Server and transferred to various consoles- Monitoring, Simulator and
Supervisory Control / Advisory Control for its respective functions. The
Supervisory Control / Advisory Control shall be engineered for various
operations through its Stability Knowledge Base (SKB). These operations
will be inferred from past history of the system, results from Transient

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Stability runs at various scenarios in the system and then take all the
necessary information and produce load shedding / islanding sequences based
on current status of equipment.
For Dynamic Load Shedding, a Load Priority Table (LPT) will be built in the
SKB, which will dynamically be changing, based on the system changes and
type of disturbance recorded. These sequence tables will be created
continuously and available on the nodes where the corresponding equipment
is located. These sequences will be kept armed. The initiation of the
sequences will take place only when the initiating point of the sequence is
actuated through a hardwired signal.
6.3 Stability Knowledge Base (SKB)

In order to develop any load shedding system, the system stability margins
should be defined. This requires a comprehensive transient stability study of
the system for various operating condition and configuration. The purpose of
these studies is to determine CCT (critical clearing time) for disturbances
throughout the electrical power system. Based on these studies further
analysis is made as to the method to prolong the system CCT, thus improving
the system stability margins with minimal load rejection. This is done by
constructing a Stability Knowledge Base (SKB) for the system for various
operating configurations and loading/ generation conditions. The steps
required to perform the studies are as follows:
 Model the power system in PSMS including dynamic model of
generators and loads.
 Identify and validate the system parameters
 Design transient stability study cases
 Evaluate the system protection scheme settings
 Evaluate the plant historical disturbance records
 Define stability margin constraints
 Run study cases to verify and fine tune the optimal and achievable
stability limits
 Perform transient stability limit assessment based on the study results
 Run hundreds of cases for various operating scenarios to develop the
SKB
 Design strategic load shedding protection scheme on the result.
 Test and verify various operating scenarios with the developed load
shedding scheme
 Compile the SKB.
6.4 Load Priority Tables (LPTs)

LPTs are stored in the IED. These tables define the priority of a load from
the Process point of view based on the location and magnitude of the

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disturbance, available generation and loading as well as the status

(configuration of Protective Devices (PDs)) of the electrical power system.
Multiple tables are allowed and will be available at the IED level in the
“active” mode.
PSMS updates the LPTs based on the changes in system. The tables are
rearranged to optimize the number and the total kW to be shed.
PSMS updates the IEDs and splits the table among the regional locations, the
table may be sorted in order of geographical location.
Tables are sorted in the order of priority. The structure of the tables will be
established based on the system requirements
6.5 State Tables

PSMS monitors the state of the system based on the collected data. The
number of state tables is based on the possible configuration of the system
such as Normal, Islanded, Generator ON/OFF, etc. PSMS monitors the
status of the PDs and determines which LPT is appropriate for each specified
location of the system.
6.6 Arm List

PSMS develops the arm lists and downloads them to the local IEDs.
Given the current state of the facility is in and possible states the facility can
transition to, PSMS will calculate various scenarios for each state.
Each Local IED receives a multiple LPT based on the updated state.
When the transition of state occurs, IED will initiate the load shedding based
on the last update from PSMS. PSMS continuously check the status of the
system to optimize the amount of load shed throughout the system.
6.7 Purchase of Online Control and Load Shedding System
6.7.1 On-Line Control

 Remote Control of Switching Devices
 Remote Control of On-Line Compensation Equipment (if
applicable)
6.7.2 Intelligent Load Shedding

 Dynamic Load Priority Table

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 User Defined “Teaching” of Neural Network

 Automatic "Training" of Neural Network
 User-Defined Load Priority Tables (LPT)
 Load Shedding Scheme Redundancy with Backup
Contingencies
 Display ILS Tables at Any Time Instant
 Simulate Various Disturbances & Display Results
 Simulate & Test ILS Recommendations
 Advanced Adaptive Learning Algorithm
6.8 Install and Setup PSMS Online Control and Load Shedding
6.8.1 OTI will install and commission, the PSMS Online Control and Load
Shedding system.
6.8.2 Engineering assistance for the system integration phase of the project
will include installation, setup and configuration of PSMS. One five-
day trip to the site is required by one OTI engineer to perform PSMS
Online Control and Load Shedding installation and integration.
6.8.3 If Client changes the metering hardware that PSMS was connected to
in Phase II, a change order from OTI is necessary for the additional
work that is required to reconnect the communication interface to
PSMS in Phase III.
6.9 Load Shedding Validation
6.9.1 The purpose of Load shedding is to protect electrical distribution

system from total failure or blackout against instability linked to
sudden large load changes such as a loss of power generators.
Additional Transient Stabilities studies will be performed to
determine optimal load shedding system capabilities.
Recommendations will be made based on those studies for proper
settings for control and switching equipment to maximize load
preservation for the system and minimize the load shedding of critical
applications.
6.9.2 OTI will validate the model for Online Control and Load Shedding
operation. Load Shedding validation is the most important part of this
phase. The validation process involves comparing the metered data
provided by Client with the State Estimation and Load Shedding
study results. Discrepancies are usually found in the two results
indicating inaccuracies of the offline model with respect to the real
system. Any deviations found during this study would be listed and
this list would be provided to Client for field verification.

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6.9.3 Modifications to meter relay locations may be required based upon

the results of the above validation.
6.10 Site Acceptance Test (SAT), PSMS Online Control and Load Shedding
6.10.1 A five-day trip to the site by one OTI engineer is required to perform
SAT. The PSMS Site Acceptance Test will be conducted at the
Client facility to validate the PSMS connectivity to all assigned
hardware.
6.10.2 Upon a successful SAT, the Client’s Project Manager shall “sign off”
on the SAT results and the project shall move into the initial period of
Maintenance Contract Services as described in PSMS License Grant
& Agreement.
6.10.3 However, if any the above SAT does not pass OTI Project Manager
may request a “retest”. For the subsequent test(s), OTI’s Project
Manager is not required to be present at the plant site. The Project
Managers shall decide collectively to base the subsequent test upon
either the same plant operating data from the previous SAT or new
real time plant operating data.
6.10.4 The SAT shall include a checklist for the Client’s Project Manager to
sign that indicates that interface screens meet the original scope
specifications and that PSMS Load Shedding shall perform all
purchased functions described within the users’ manuals.
6.10.5 OTI will prepare the necessary test procedures. Columns shall be
provided so that the nominated testers can formally sign that the test
is complete and satisfactory.
6.11 SAT Final Review
6.11.1 A SAT Final Review will be conducted for PSMS Server software,
the input tag table, and the system model in accordance with the SAT
results. A five-day trip to the site by one OTI engineer is required for
the final review to resolve any open issues with the SAT.
7 PHASE III - SCOPE OF DELIVERABLES
7.1 PSMS Load Shedding software.
7.2 Engineering Services per Section 6 of this proposal.

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8 CLIENT’S RESPONSIBILITIES
OTI requests that the Client appoint respective Project Managers who shall be
responsible for their obligations throughout the project implementation.
Implementation of PSMS requires that the Client to provide the following
information and assistance at their expense.
8.1 Project Management

Client will provide coordination between OTI and Client staff and/or any
other subcontractors.
8.2 Data Collection

All existing and available system data should be provided to OTI at the front-
end of the project. These data should include:
8.2.1 Existing ETAP Model for the selected portion of the system.
8.2.2 Equipment ratings.
8.2.3 All Plant & equipment descriptions.
8.2.4 All Plant operating data such as expected predominant plant operation
mode(s), i.e. base load, part load, etc.
8.2.5 All reference data and other pertinent information describing system
apparatus.
8.2.6 List of metering points and the electrical parameters read from the
field meters along with the set points.
8.3 Tag Configuration

Complete tag list, presented as an Excel spreadsheet (predefined format),
with specification of engineering units, zero and calibration span (in
engineering unit) displayed in engineering units, and description of the
instrument saved.
8.4 Required Measured Data

All applicable measured data for each equipment component to be made
available and accessible throughout the project. Various set of “Real-time”
data from Pegasus and DCS along with breaker / switch status and metering
tags in the system for different system conditions.
8.5 Hardware Compliance

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OTI requests to approve of all hardware and software specifications for the
PSMS prior to its purchase. The Client should ensure that PSMS Server and
Console hardware meet the minimum PC hardware as well as operating
system requirements per Attachment B.
8.6 Software Security

OTI requests restricted use of the PSMS Computer by non-OTI personnel
until they have received formal PSMS training, e.g. no changing of
passwords during the PSMS installation, turnoff the modem, disconnecting
the telephone line, loading other software programs, changing computer
configurations, etc.
8.7 Physical Security

Client will be responsible for any materials, which OTI may deliver or have
delivered to the plant.
8.8 Metering Hardware

Client will be responsible for purchasing and installing any additional
hardware required for setting up PSMS that is not specifically stated in the
above proposal.
9 USER SUPPORT
9.1 OTI will provide software support via telephone, e-mail and fax, at no
additional charge, during the initial twelve months following the SAT. Client
will receive all upgrades that are released for PSMS system during the
maintenance period at no additional charge. Follow-up user support and
program upgrades will be provided at 15% of the prevailing published price
annually. Client may elect to pre-pay maintenance for up to five years at the
time of the PSMS purchase at the prices published in the proposal.
10 STANDARDS
10.1 The user manuals, other documentation, computer screens, training and other
interfaces shall be presented in English. The units of measure shall be in
English or as requested by the Client. OTI reserves the right to change or
modify the proposed computer hardware and software, other than the PSMS
software.

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11 PROJECT IMPLEMENTATION
11.1 OTI proposes to start work on Phase I and Phase II simultaneously, as

requested, upon receipt of Client’s Purchase Order and Client’s execution of
PSMS Software License and Services Agreements. OTI will begin work on
Phase III upon receipt of Client’s Purchase Order and any addendums to the
PSMS Software License and Services Agreements as necessitated by the
selection of third party services, software, and hardware (if any.)
11.2 Duration for completing Phase I of the project will be less than five months.
Completion of Phase II is expected to occur concurrently with the completion
of Phase I. A detailed plan of action is laid out in the updated Microsoft
Project file created by the Client, which is associated with this project. Note
that several milestones, including data collection and validation, need to be
completed prior to working on portions of Phase II. Completion of Phase III
is less than three months after the successful commissioning of the load
shedding hardware, the completion of the SAT of Phase II, and the execution
of the purchase order for Phase III. Note that project completion dates will be
affected if there is a slippage in delivery of the required system data as
specified in this proposal.
11.3 Each party shall identify a Project Manager within two weeks of OTI’s
authorization to proceed with the project. The respective Project Managers
shall be totally responsible for their companies’ activities from initiating the
project through conducting SAT. The Project Managers shall develop and
concur on a detailed project schedule. OTI shall assign a Project Manager
and a Project Engineer for this project.
11.4 OTI proposes a total of seven trips to visit the Client’s site and one client trip
to visit OTI’s R&D office. Estimated average trip duration is seven days
each, which includes two travel days per round trip. The objectives of these
trips are to:
11.4.1 Perform the visibility study (Phase I)
11.4.2 Conduct the FAT at OTI (Phase II)
11.4.3 Installation and commissioning of PSMS Imperious except Online

Control (Phase II)
11.4.4 Perform the Phase II SAT and train the plant staff (Phase II)
11.4.5 Installation and commissioning of PSMS Online Control and Load

Shedding (Phase III)

PSMS – NEW - 0403
11.4.6 Perform the Phase III SAT (Phase III)
11.4.7 Perform the SAT Review (Phase III)
11.5 OTI reserves the right to modify the number and duration of trips to satisfy
Client’s requirements. OTI shall rely upon conference calls with the Client
periodically to review the project’s status.
11.6 OTI shall notify Client’s Project Manager three weeks prior to the desired
date to conduct the FAT at OTI’s Lake Forest, CA office. In the event that
the Client’s Project Manager cannot attend the FAT, then OTI’s Project
Manager shall conduct the test as planned, send the results to the Client’s
Project Manager and then have a conference call with the Client’s Project
Manager to discuss the results.
11.7 OTI will notify Client’s Project Manager one month prior to each of the site
trips. The Client’s Project Manager may request a one-time delay up to one
month in initiating the SAT. In the event that the Client’s Project Manager
further desires to delay the initiation of the SAT, then the invoices pursuant
to Paragraphs 12.3.7 shall be paid as if PSMS passed the SAT. Afterwards,
Client may request OTI to initiate the SAT at a mutually convenient date to
the parties.
12 CONSIDERATION & PAYMENT SCHEDULE
12.1 Phase I – PSMS Engineering

OTI proposes to provide engineering services based on the scope of
deliverables. Client agrees to pay the price below:
12.1.1 Total Phase I Price (Total of 740 man-hours) $ 82,900

Notes:
The price in 12.1.3 is quoted for a maximum of 740 man- hours of engineering.
Any additional engineering requests will be handled as a change order.
Estimated travel expenses of $3,085 are not included in the above prices.
12.2 Phase II – PSMS Software

OTI proposes to license and install PSMS based on the scope of deliverables.
Client agrees to pay the price below.
12.2.1 PSMS Imperious except Online Control

(500 Tag / 500 Bus) $ 66,600
12.3 Phase II – PSMS Engineering and Training

PSMS – NEW - 0403
OTI proposes to provide engineering services based on the scope of

deliverables. Client agrees to pay the price below:
12.3.1 Phase II Engineering (Total of 240 man-hours) $ 32,400
12.3.2 Training (Discounted) $ 11,000
12.3.3 Phase II Engineering and Training $ 43,400

Notes:
The price in 12.2.1 is quoted for a maximum of 240 man-hours of engineering.
Any additional engineering request will be handled as a change order.
12.4 Phase III – PSMS Load Shedding Software
12.4.1 One PSMS Online Control and Load Shedding Software $32,200
12.5 Phase III – PSMS Load Shedding Engineering and Installation

OTI proposes to license and install PSMS based on the scope of deliverables.
Client agrees to pay the price below.
12.5.1 Phase III Engineering (Total of 160 man-hours) $ 21,600

Notes:
The price in 12.5.1 is quoted for a maximum of 160 man-hours of engineering.
Any additional engineering request will be handled as a change order.
12.6 OTI shall invoice the Client according to the following:
12.6.1 Phase I - 50% of the PSMS Engineering price upon receipt of Client’s
Purchase Order.
Phase I - 50% of the PSMS Engineering price upon delivery of

completed ETAP model and communication hardware
recommendations.
12.6.2 Phase II - 100% of the PSMS Software price upon receipt of Client’s
Purchase Order and executed PSMS Software License and Services
Agreements.
12.6.3 Phase II - 100% of the Hardware price at the time of hardware order
(if applicable).

PSMS – NEW - 0403
12.6.4 Phase II - 30% of the PSMS Engineering and Training price upon
receipt of Client’s Purchase Order and executed Software License and
Services Agreements.
submitting the configuration required for the measured and calculated
System tags and an accurate plant state point diagram.
completion of the installation and commissioning of PSMS.
successful completion of the PSMS Integration SAT.
12.6.8 Phase III - 100% of the PSMS Software price upon receipt of Client’s
Purchase Order and executed PSMS Software License and Services
Agreements.
12.6.9 Phase III - 100% of the Hardware price at the time of hardware order
(if applicable).
12.6.10 Phase III - 50% of the Load Shedd

Purchase Order and executed Software License and Services
Agreements.

installation and commissioning of Load Shedding.

completion of the Load Shedding SAT.
12.7 OTI shall invoice the Client per occurrence for its traveling expenses
associated with this project at actual cost based upon written documentation.
Travel expenses shall include the cost for business-class air tickets, local
transportation, lodging and meals.
12.8 Either party may request a Change Order, which reflects an increase or
decrease in the proposed work scope. The parties shall concur in writing as
to the scope of the Change Order and its impact on the project schedule and
prices prior to commencing the work proposed in the Change Order. As an
example, the Client may desire OTI to provide additional PSMS Consoles,
simulation capabilities, and/or engineering that is not envisioned in this
Commercial Proposal’s scope.

PSMS – NEW - 0403
12.9 OTI shall provide additional services, training, technical support and
engineering consulting at a nominal engineering services rate of $161 per
man-hour, portal-to-portal, plus direct expenses. Travel time shall consist of
eight hours per 24-hour day.
12.10 OTI shall submit its invoices to the Client for direct payment. Invoices are
due and payable in full within 30 days from OTI’s invoice dates. Client is
responsible to pay any taxes and/or customs due on the hardware purchased
and/or the PSMS sale, installation, and/or services. Any additional costs that
OTI may incur to import hardware to the Client’s site or conduct business
within the Client’s country to facilitate the delivery of PSMS shall be paid for
or reimbursed by the Client with its prior approval. A finance charge of
1.5% per month shall apply after the forty days on any unpaid balances.
Invoices are payable in United States currency. The Client shall wire transfer
the funds to the following OTI’s account:
Wells Fargo Bank

Bank Number 121000248
Account Number 692-171580
Operation Technology, Inc.
International Swift BIC: WFBIUS6S
13 PSMS HARDWARE (May be Provided by Client)

PSMS Hardware includes one PSMS Server and one PSMS Console PC. Client has
the option of purchasing the PC’s locally or can request OTI to provide the
appropriate PC’s. If Client should choose to use existing PC’s for PSMS, they should
meet then minimum hardware requirements as mentioned in the Attachment B –
PSMS Hardware Requirements.
13.1 One PSMS Server Hardware…………………………..…….US $ 12,000.00
13.2 One PSMS Console Hardware…………………………..……US $ 7,000.00
13.3 One OPC Server Hardware…………………………..…….....US $ 7,000.00

Server hardware is not configured as redundant. Expect additional costs for
redundant systems. PSMS hardware specification is listed in Previous Attachment-B.
Note that the above hardware price ranges vary based on manufacturer brand and
are subject to change. PSMS Server and Console PCs can be furnished by OTI.
14 LOAD SHEDDING HARDWARE

OTI shall determine the quantity and type of hardware needed to perform the
necessary load shedding application as part of the Load Shedding Analysis. The cost

PSMS – NEW - 0403
for load shedding hardware and installation of the hardware is not included in the
above price.
The estimated cost of Load Shedding hardware using General Electric (GE)
Universal Relays to implement Load Shedding, including installation, configuration,
and testing is less than $200,000.00. PLCs or other Universal-Type Relays may be
less expensive, and may be a viable option. This will be determined by the
engineering studies included in Phase I of the above proposal.
The PSMS interface including the tag database and Load State Estimator may need
to be revised if the new load shedding hardware replaces existing monitoring
hardware. In the instance that the 240 hours specified do not provide enough time to
make the validation and necessary changes it may require a service change order. If
a change order is required, the client will be notified prior to spending additional
hours.
The terms and conditions for phase III may be different than Phase I and Phase II
depending upon the vendor [s] selected. In addition the installation of the hardware
may require infrastructure upgrades at the site, which are also not included in this
proposal.
15 LIABILITY
THE TOTAL LIABILITY OF OTI UNDER ANY EVENT OR CIRCUMSTANCE
IS LIMITED TO ONE-HALF OF THE AMOUNT OF THE CONTRACT AS
LISTED IN PARAGRAPH 12.1.1, 12.2.3 AND 12.5.1 OF THIS CONTRACT.
THE CLIENT AGREES THAT OTI AND ITS OFFICERS, EMPLOYEES OR
REPRESENTATIVES SHALL NOT BE LIABLE IN ANY WAY FOR ERRORS
MADE BY THE CLIENT, HIS AGENTS OR EMPLOYEES BY TRANSPOSING
OR RECOPYING OF ENGINEERING DATA, CALCULATION AND
DRAWINGS, WRONG INTERPRETATION OF THE STUDY RESULTS, AND
CHANGES TO THE FINAL RECOMMENDATION OR REPORT.
FURTHERMORE, OFFICERS, EMPLOYEES, REPRESENTATIVES, OR
OTHER AGENTS OF OTI SHALL BE HELD HARMLESS FROM ANY
CLAIMS, INCIDENTAL OR CONSEQUENTIAL DAMAGES, AND SHALL
NOT BE LIABLE FOR ANY COSTS, LOSSES, DELAYS, ASSOCIATED
DAMAGES, OR ANY OTHER CHARGES, WHICH MAY BE THE RESULT OF
SUCH ERRORS.
This confidential proposal remains valid until May 9, 2003. All prices are in US currency
and exclude shipping, handling, taxes, duties, surcharges and other government-specified
amounts. Estimated tax amounts in Indonesia are 6% (hardware, software, and training)
and 6% + 10% (engineering / consulting services) based on the specific type of product /

PSMS – NEW - 0403
service. These amounts may vary depending upon the clients’ relationship with the local
government.

Technical & Commercial Contract To Provide Powerstation Management System (Psms

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PSMS – PT Newmont, Lombok, Indonesia

PSMS – NEW - 0403

Technical & Commercial Contract to Provide

April 22, 2003

Operation Technology, Inc.

Operation Technology, Inc. -1- Revision 1

Attachment A: Package List and Description

Operation Technology, Inc. -2- Revision 1

ETAP PowerStation Management System (PSMS) offers advanced modules with

2 PHASE I - PSMS ENGINEERING

2.1 Kick-off Meeting

Operation Technology, Inc. -3- Revision 1

2.1.1 Kick-off meeting will be arranged to answer questions, request

2.2 Data Collection

 The latest ETAP model for the system.

Operation Technology, Inc. -4- Revision 1

2.3 System Modeling

2.3.2 The existing ETAP model will be expanded to include metering

2.4 Visibility Study & Data Acquisition

2.4.2 Perform a plant visibility study to identify required measurement

2.5 Evaluation & Validation

2.5.1 Perform model validation studies for steady-state operations.

2.5.2 Power monitoring and control hardware evaluation.

2.5.3 System studies for steady-state operations.

2.5.4 Tag determination and location for steady-state operations.

2.6 Communication Hardware Architecture for PSMS Integration

Operation Technology, Inc. -5- Revision 1

OTI’s scope of involvement with the installation and commissioning of the GE

2.7 Transient Stability and Load Shedding Studies

2.7.1 Transient Stability analysis will be performed to investigate the

Operation Technology, Inc. -6- Revision 1

 Perform strategic load-shedding schedule protection design

3 PHASE I - SCOPE OF DELIVERABLES

4 PHASE II - PSMS INSTALLATION & INTEGRATION

4.1 Purchase PSMS Imperious (except Online Control)

4.1.1 PSMS Server Software

4.1.2 PSMS Consoles

4.1.3 Advanced Monitoring

4.1.4 Real-Time Simulator

Operation Technology, Inc. -7- Revision 1

4.1.5 Event Playback

4.2 PSMS Server and Console Hardware

4.3 Data Collection

4.4 Tag Database Creation

4.5 Model Validation

Operation Technology, Inc. -8- Revision 1

4.6 Factory Acceptance Test

4.6.1 Conduct a one-day Factory Acceptance Test (FAT) in OTI’s,

4.7 PSMS interface

4.7.1 Communication interface to PSMS Server/Console(s) will be via

4.8 Install and Setup PSMS

Operation Technology, Inc. -9- Revision 1

5 PHASE II - SCOPE OF DELIVERABLES

5.2 One OPC server software.

5.3 Engineering Services per Section 4 of this proposal.

5.4 One PSMS User Guide / Operating Manual.

5.5 PSMS Onsite Training

Operation Technology, Inc. - 10 - Revision 1

6 PHASE III – LOAD SHEDDING INSTALLATION AND INTEGRATION

6.1 Load Preservation System

This scheme requires transient system analysis on the system model to be

6.2 Load Shedding System