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