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VES-1100 General Requirements for Third Party Inspection

Services
TS-ENC-STD-0002

VICO Indonesia

VES-1100 General Requirements for Third Party Inspection

Services

Author

A.R. Thanura(Discipline Engineering Section Head)

Reviewer

A.Rastiarsa (E&C Manager)

Approver

P.Stegers (Technical Support Vice

President) / Vania De Stefani
(Engineering Authority)

VMS Primary
Element Reference
Date of Issue
Revision Number

VMS Secondary
Element Reference
31-Jul-2013
Next Review Date
B.01
Document Level
NOT CONTROLLED WHEN PRINTED OR DOWNLOADED
11.3

31-Jul-2016
2 - Standard

Helping me do my job better

VES-1100 General Requirements for Third Party Inspection

Services
TS-ENC-STD-0002

Revision History
Amendment Date

Revision
Number

Amender
Initials & Job
Title

Related Documents
Document Number

Document Name

Document Roles
Role
Reviewer
Approver
Consulted

Informed

Name

Job Title

Amendment

VICO Indonesia


VICO INDONESIA

DOCUMENT

VICO ENGINEERING STANDARD

NUMBER

VES-1100

TITLE

GENERAL REQUIREMENTS FOR THIRD PARTY INSPECTION SERVICES

11/02

Changed Virginia Indonesia Company to Virginia

Indonesia Company LLC and changed
BPPKA/PERTAMINA to BP MIGAS

Isdiarso K.

Sukiswanto

04/93

Converted from Word Processor # 201 to Word

Perfect 51

Djarot S.S.

Lukman M.

04/90

Changed HES to VES

Herriwanto

D.S. Newson

05/89

Combined with MTA-1100, added section 4.7

B. Gadjuli

D.S. Newson

02/89

Sections 2.0, 3.2d, 4.5i, 4.5j, 8.1c

B. Gadjuli

D.S. Newson

11/88

Defined types of services, revised payment terms,

revised data sheet

J. Carlson

D.S. Newson

9/86

General Revision, Add HES No.

J. Carlson

L.W. Smith

2/86

Original Issue

J. Carlson

L.W. Smith

NO.

DATE

REVISION

PREPARED

APPROVED BY

VES-1100

File: F:\WPDATA\NEWVES\2002\VES1100

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VES-1100
Rev. 7, 11/02

GENERAL REQUIREMENTS FOR THIRD PARTY INSPECTION SERVICES

TABLE OF CONTENTS
Page
1.0

SCOPE

2.0

DEFINITIONS

3.0

GENERAL REQUIREMENTS

4.0

DOCUMENTATION

5.0

COMMUNICATION WITH COMPANY

6.0

COMMUNICATION WITH VENDOR

7.0

COST OF INSPECTION SERVICES

8.0

PROPOSAL DOCUMENTATION

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3

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VES-1100
Rev. 7, 11/02

1.0

SCOPE
This standard defines the minimum requirements for inspection of equipment and materials by a
third party inspection company. This standard must be used in conjunction with the latest revision
of Company Standard VES-1000 and all the requirements defined in the Purchase Order for the
material and/or equipment.

2.0

DEFINITIONS
Throughout this Standard, the terms used shall be as defined in VES-1000 with the following
exceptions:

3.0

Inspector

The third party inspection company and all his subcontractors, if any, and
all employees of these contractors responsible for performing the services
defined in this Agreement.

Agreement

Company's "Contract Short Format", or any other type of contract between

Company and Inspector which includes this Standard, VES-1000, and all
terms, conditions, documents, drawings, etc. referenced therein.

GENERAL REQUIREMENTS
3.1

Inspector shall furnish international third-party inspection services to perform progress

inspection and expediting, to witness testing and to perform final inspection services in the
various manufacturing facilities associated with the Company Purchase Order(s) as defined
in the Inspection Document (See Section 4.0) and as specified on the Third Party Inspection
Services Data Sheets. These inspection services are required to ensure that the goods to be
supplied for Company's use are in complete compliance with the requirements defined in
the Purchase Order, and all specifications, data sheets, standards, codes, drawings and other
documents referenced therein.

3.2

The various types of inspection and expediting services required have been divided into the
following general categories:

a)

Final Inspection - Inspector shall provide the services necessary to visually inspect all the
equipment, materials and supporting documentation at point of manufacture, after
manufacturer has stated that the equipment is complete and ready to ship to ensure
that all the requirements of Company's Inspection Document, including all
referenced specifications, drawings and other documents referenced herein, have
been satisfied. Final inspection typically includes dimensional checks, inspection
of mill certificates, material test reports, test reports for hydrostatic and
performance testing and visual inspection of completed equipment to verify
compliance with Company's requirements.
b)

Progress Inspection - Inspector shall provide services for the inspection of

equipment and materials during the manufacturing process which shall include
witnessing of tests performed by the manufacturer on various components and
assemblies of the equipment and visual inspection of the manufacturing process of

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VES-1100
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the equipment and its components to satisfy the requirements defined in Company's
Inspection Document. When Progress Inspection is specified, the services
specified above for Final Inspection shall also be provided by Inspector. Progress
inspection typically includes such activities as welding inspection/NDT, witnessing
hydrostatic and performance testing, inspection of mill certificates and material test
reports, dimensional checks and functional tests.
c)

Packing Inspection - Inspector shall provide inspection services during the preparation of
equipment and materials for shipment, including visual inspection of the packing
operations, physical checking of all packing lists and review of all shipping
documentation.

d)

Migas Certification - Inspector shall provide all the services necessary for verification and
compilation of all documents, calculations, radiographs, hydrotest reports and all
other documents necessary to obtain certification of equipment by BP MIGAS, for
further transmittal to BP MIGAS by Company. Inspector shall provide all additional
information and answer all questions or comments as required by MIGAS until such
time as the certification is officially approved.

e)

Expediting - Inspector shall provide expediting services to ensure timely completion of the
manufacturing process. These services shall include meeting with manufacturers to
establish production schedules, telephone progress checks (minimum once per
week), visits to location of manufacturer and sub-suppliers (minimum once every 2
weeks) to verify actual progress and preparation of weekly expediting reports for
Company.

3.3

The type of services required will be specified on the Third Party Inspection Services Data
Sheet. Inspector shall perform all the services described in Section 3.2 for the types
specified on the data sheet plus all other inspection and testing requirements defined in
Company's Inspection Document.

3.4

Inspector shall be authorized to act as Company's inspection representative during any

inspection at Vendor's manufacturing facility, within the limits defined in the Purchase
Order. Inspector will have the authority to stop manufacture if non-compliance with the
Purchase Order is discovered. However, a delay in manufacture of more than four working
days resulting from such an action will require written concurrence from Company. It is
preferred that inspection visits not be scheduled on Fridays due to this four day turn around.

3.5

Inspector is not authorized to approve any changes which affect the price, delivery, technical
or commercial requirements defined in Company's Purchase Order. However, in the event
that changes which may improve price and/or delivery come to the attention of the Inspector,
he shall immediately notify Company that such changes are possible.
During or upon completion of inspection of items under manufacture, Inspector shall
immediately notify Company, by telex, of any deficiencies which may have been discovered
during the inspection.

3.6

3.7

Inspector shall not, under any circumstances, release goods for shipment until he has
received written or telex permission from Company to do so.

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VES-1100
Rev. 7, 11/02

4.0

DOCUMENTATION
4.1

For each Purchase Order, Company will furnish Inspector with an Inspection Document
consisting of the following:

a)
b)

Complete copy of the Purchase Order and all Change Orders, if any.
Complete set of specifications and all other documents and/or drawings referenced by the
Purchase Order.
Complete copy of Vendor's proposal.
Complete set of all correspondence between Purchaser and Vendor.
e)
Complete set of Vendor drawings, if available.
f)
Name, address, telephone number and telex number of Vendor's contact.
Letter from Company outlining Contractor's authority.
Name of Company's authorized project representative.
Company's Third Party Inspection Services Data Sheet.

c)
d)
g)
h)
i)
4.2

This document shall be in the possession of the Inspector's representative at Vendor's facility
during each inspection visit.

4.3

For progress inspections, some of the information, such as Vendor's drawings, may not be
available. It will be Company's responsibility to update and revise the Inspection Document
as required throughout the term of the Agreement.

4.4

Inspector shall furnish all referenced international (principally American) codes and
standards, such as those published by the American Petroleum Institute (API), American
National Standards Institute (ANSI), American Society of Mechanical Engineers (ASME),
American Society of Testing and Material (ASTM) and other international standards
organizations when these documents are referenced on Company Purchase Orders,
specifications and drawings. Inspector shall be familiar with the requirements of these
various codes and standards and shall have access to the referenced documents at all times
during each inspection visit.

4.5

All visits by Inspector to any Vendor's facility and all Final Inspections shall be documented
by an Inspection Report prepared by Inspector. These reports shall include, but not be
limited to the following information:

a)
b)

Purchase order number

Manufacturer's order number, shop order number, etc.,
c)
Name of Inspector
d)
Name of manufacturer's representative
Location of manufacturer's facility (address, telephone number, telex number)
Date of inspection
g)
Production status of order at time of inspection
Complete description of all inspection activities and the result of these inspections
Certified copies of all Vendor's test records, radiographs, instrument calibration sheets, loop
test sheets, etc.
Inspector's update of Vendor's fabrication schedule and best estimate of Vendor's completion
date

e)
f)
h)
i)
j)

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VES-1100
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k)
l)
m)
n)
4.6

Complete description of any defects, deficiencies, deviations from specifications or any

other irregularities discovered
Inspector's interpretation of any NDT results including radiographs
Photographs of the equipment and/or materials during the various phases of fabrication
including a complete set of as-built photographs
Inspector's signature
The Inspection Report from each visit must be mailed by Inspector via a courier service to
the attention of Company's project representative no later than three working days after
completion of the inspection. The Inspection Report must reach Company within seven
working days after completion of the inspection. Inspector may request additional time only
if required for test result interpretation, or because of unusual circumstances surrounding
inspection activity.

4.7

When Migas Certification (Section 3.2, d) is specified, Inspector shall provide the following
documentation, in addition to all other documents which may be required by Migas for issue
of an operating license:

a)

Manufacturer's Data Reports

b)

Assembly and Detail Drawings

c)

Calculation Sheets - signed by engineer

d)

Welding Procedure Specifications, Qualification Test Records

e)

Inspection Specifications

f)

List of Material Mill Certificates (Showing location, heat number)

g)

Mill Test Certificates

h)

Manufacturers Inspection Results - signed by inspector

-

i)
5.0

Actual Dimensional Records

NDT
Hydrostatic/Pneumatic Test Record Charts
Post Weld Heat Treatment Record Charts (when applicable)
Hardness Test Records (when applicable)

Name Plate Rubbing

COMMUNICATION WITH COMPANY

5.1

All communication between Inspector and Company shall be through Company's Project
Representative as defined on the Third Party Inspection Services Data Sheet.

5.2

Inspector is required to notify Company's Project Representative by telex prior to any

inspection visit. Company will then authorize the inspection by return telex. Any inspection
visit not previously authorized by Company will be for Inspector's account.

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VES-1100
Rev. 7, 11/02

5.3

Upon completion of each inspection visit, Inspector is required to notify Company by telex,
within one working day after completion of the inspection. This telex notification shall
include a brief summary of the inspection visit, including an outline of any proposed
shipping schedules.

5.4

Company's address and telex number are as follows:

VIRGINIA INDONESIA CO., LLC
c/o Supply Chain Management
Plaza Kuningan Menara Selatan, Lantai 6,
Jln. H.R. Rasuna Said, Kav. C11-14,
Jakarta.
Telex :
62458, VICO IA
Fax
:
(021) 523-6340/6100

Attention :

6.0

7.0

(Project Representative as defined on Third Party Inspection Services Data

Sheet)

COMMUNICATION WITH VENDOR

6.1

Upon award of this Agreement, Company will notify Vendor(s) that Inspector has been
appointed as Company's Inspection Representative.

6.2

Subsequent to this notification by Company, all future communication required to schedule

and coordinate inspection and testing visits shall be by Inspector, with a copy of all
communications to Company's project representative.

6.3

Once a tentative inspection date has been agreed upon by Vendor and Inspector, Inspector
shall telex Company as required by section 5.2 of this standard. Inspector shall allow at least
one week after notification of Company for receipt of approval to proceed with the
inspection visit.

COST OF INSPECTION SERVICES

7.1

Bidders shall submit a lump sum price to perform all the inspection services required by
Company's Inspection Document and by the Third Party Inspection Services Data Sheet.
This lump sum price shall cover all costs to perform the services, including transportation,
living expenses, correspondence (letter/telexes/phone calls), testing equipment and all other
costs associated with providing the inspection services.

7.2

The nature of third party inspection requires a means to provide for additional services when
problems, such as failure of a test which then requires repair and reinspection, occur. To
provide for such an occurrence, Bidder shall include a Provisional Sum in his lump sum
price equal to the percentage defined on the Third Inspection Services Data Sheet. This
Provisional Sum will only be paid if additional services are authorized in writing by
Company and then only for the additional services actually performed. If no additional

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VES-1100
Rev. 7, 11/02

services are required to complete the work, then the Provisional Sum will not be paid.
7.3

Bidders shall define units rates on the Third Party Inspection Services Data Sheet in terms of
Transportation Costs per inspection visit, Operating Cost per day at site of inspection and
Living Cost per man-day basis, in the proposal. Provisional Sums, if authorized, will be
based on these unit rates for only those services actually performed.

a)

Transportation cost shall be defined as a single per round trip cost to cover all air and surface
transportation costs for Inspector to travel to Vendor's manufacturing facilities.
Living Cost shall be defined as a single per man day cost to cover all living expenses,
including housing, meals, laundry and all other costs necessary to provide the
services specified in this Standard.

b)

c)

Operating Cost shall be defined as a single per man day cost for Inspector's personnel,
including all inspection and test equipment, telex, telephone, courier service and all
other costs necessary to provide the required inspection services.

7.4

Since Company requires telex notice before and after any inspection visit, these costs can be
easily verified. However, Inspector is required to document each invoiced inspection visit
against the Provisional Sum with copies of airline tickets, hotel bills, and other receipts to
verify physical presence at site during time for which the invoice is applicable.

7.5

Inspector shall not, under any circumstances, perform services which exceed the maximum
lumpsum price as defined in the Agreement. Any invoices submitted by Inspector which
cause the price for these services to exceed this maximum lumpsum value will be to
Contractor's account.

7.6

Invoicing for all services rendered shall be submitted to Company, Attention: Accounts
Payable, with a separate copy to Company's Project Representative. All invoices shall show
the following:

a)
b)

AFE No.
Service Agreement No.
c)
Purchase Order No.
Project Title
Type of Equipment or Material Inspected
Completion Report
Inspectors Name

d)
e)
f)
g)
8.0

PROPOSAL DOCUMENTATION
8.1

Bidders shall provide the following information in their proposals:

a)

Completed copies of Company's Third Party Inspection Services Data Sheets.

b)

Company's Inspection Document furnished with Request for Quotations.

c)

Completed copies of Company's Contract Short Format "Request for Quotation" Forms.

d)

A written resume defining the expertise and experience of the inspector(s) proposed for this
work.

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VES-1100
Rev. 7, 11/02

e)

A written document defining the scope of services which Inspector proposes to satisfy
Company's inspection requirement. This document will be used to evaluate the
Inspector's interpretation of Company's Purchase Order requirements and his ability
to provide the inspection services required.

f)

Name and address of Inspector's facility nearest to Vendor's facility from which services
will be provided.

8.2

Bid received which do not include all this information may be disqualified.

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VES-1100
Rev. 7, 11/02

VICO INDONESIA
THIRD PARTY INSPECTION SERVICES DATA SHEET
AFE No.

Revision:

Date

Prepared By
Approved By

:
:

Company Project Representative

Title

:
:
:

INSPECTION SERVICES

LOCATION
P.O. NO.

DESCRIPTION OF
EQUIPMENT AND MATERIALS

QUANTIT
Y

TYPE OF SERVICES REQUIRED

[
[
[
[
[
[

]
]
]
]
]
]

Final Inspection Only

Progress Inspection
Packing Inspection
Migas Certification
Expediting
Other :

TAG NO.

MFRG.

LUMPSUM PRICE INCLUDES

INSPECTOR'S
POINT OF
ORIGIN

UNIT RATE

NO. OF TRIPS

LUMSUM PRICE COMPOSITION

Price Unit
Transportation
Living
Operating :

:
:

Per Trip
Per Trip
Per Trip

NO. OF DAYS

Total Quantity
Transportation
Living
Operating :

:
:

Trips
Days
Days

Sub Total
Provisional Sum

% of Sub-Total

TOTAL LUMPSUM PRICE :

Notes :

1)

This Data Sheet must be used in conjunction with Company Specification VES-1100.

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VES-1100
Rev. 7, 11/02

Total Price

NO. OF
PERSONNEL