Gbaran Ubie IOGP (E-15811) SITE MATERIAL MANAGEMENT PROCEDURE

DAEWOO DN-54 GEN-E15811-C04-0002-C03

REVISION CHANGE DETAILS

Rev Location of Change Brief Description of Change

A02 Table of Contents Restructured(Section 6 to Section 10)
Section 1 PURPOSE SHELL comments incorporated
Section 2 SCOPE SHELL comment incorporated
Section 3 DEFINITION Added some abbreviations in this section
Section 6.0 and subsection 6.1 to Re-structured to incorporate SHELL comments
6.10
Section 7 SITE PROCUREMENT Developed
Section 8 DISPOSITION OF Changed Section title(MATERIAL
SURPLUS MATERIALS BACKORDERS) and contents for better
understanding
Section 9 DOCUMENT FORMS Developed in detail
Attachment 1 MATERIAL SHELL comment incorporated
RECEIVING REPORT
Attachment 3 MATERIAL SHELL comment incorporated
INVENTORY CHECK LIST
C01 GBU-15811-B-TR-00534 of SHELL comments
incorporated
C02 Section 6.4, 6.5, 6.7, 6.9, 6.10, 9.0 Developed
10.0
C03 Section 6.1, 6.6, 6.9.3, 6.10, 9.0, Developed
10.0

Page 2 of 18
Gbaran Ubie IOGP (E-15811) SITE MATERIAL MANAGEMENT PROCEDURE
DAEWOO DN-54 GEN-E15811-C04-0002-C03

TABLE OF CONTENTS

1.0 PURPOSE
2.0 SCOPE
3.0 DEFINITIONS AND ABBREVIATIONS
4.0 REFERENCE
5.0 RESPONSIBILITY
6.0 SITE MATERIAL MANGEMENT
6.1 FILE SETUP AND ADMINISTRATION

6.2 MATERIAL RECEIVING

6.3 CHECK AND INSPECTION

6.4 MATERIAL RECEIVING REPORT (MRR)

6.5 HANDLING OVERAGES, SHORTAGES & DAMAGES(OS&D)

6.6 NON-CONFORMANCE

6.7 STORAGE OF MATERIAL AND EQUIPMENT

6.8 MATERIAL AND EQUIPMENT STORAGE REQUIREMENTS

6.9 PROTECTION AND PRESERVATION

6.10 ISSUE OF MATERIALS AND EQUIPMENT

7.0 SITE PROCUREMENT

8.0 DISPOSITION OF SURPLUS MATERIALS

9.0 DOCUMENT FORMS

10.0 ATTACHMENTS

Page 3 of 18
Gbaran Ubie IOGP (E-15811) SITE MATERIAL MANAGEMENT PROCEDURE
DAEWOO DN-54 GEN-E15811-C04-0002-C03

1.0 PURPOSE

The objective of Site Material Management is to continue the material management

effort initiated in the office with specific emphasis on supporting the daily construction
effort. The primary functions of Site Material Management include receiving materials,
warehousing, controlling inventory, issuing materials, and providing any necessary site
procurement for materials required for the project completion. This procedure describes
responsibilities of Site Material Management Group and site material management
process for the Gbaran Ubie Integrated Oil and Gas Project (hereinafter called
“Project”). This procedure provides all parties with an understanding of their
responsibilities and requirements to meet the overall material management goals of the
Project.

2.0 SCOPE

This procedure applies to all the activities necessary to control the material and
equipment at Site, e.g. receiving, storage, handling, preservation and issue to
construction and disposal of surplus materials.

3.0 DEFINITION AND ABBREVIATIONS

• COMPANY means Shell Petroleum Development Company of Nigeria

Limited(hereinafter called “SHELL”)

• CONTRACTOR means Daewoo Engineering & Construction Co. Ltd(hereinafter

called “DAEWOO”)

• JOPT means Joint Offshore Procurement Team consisting of DAEWOO and

FLUOR personnel for the Contract
• MaterialManager®(MatMan) is the standard computer program that will be utilized
to support the Material Management function on this project.
• CPF - Central Processing Facility
• MASL - Master Approved Supplier List
• E-SPIR – Electronic Spare Parts Interchangeability Record
• ETA - Estimated Time of Arrival
• CWP – Construction Work Package
• RAS – Request at Site
• PHC – Port Harcourt
• HSE – Health, Safety and Environment
• PO – Purchase Order
• MSDS – Material Safety Data Sheet
• PPM – Project Procurement Manager

Page 4 of 18
Gbaran Ubie IOGP (E-15811) SITE MATERIAL MANAGEMENT PROCEDURE
DAEWOO DN-54 GEN-E15811-C04-0002-C03

• SMM – Site Material Manager

• SMCE – Site Material Control Engineer
• CCO – Custom Clearance Officer
• CMCE – Construction Material Control Engineer
• QCM – Quality Control Manager
• CM – Construction Manager

4.0 REFERENCE

• GEN-E15811-C01-00001, Procurement Plan

• GEN-E15811-C04-00001, Site Material Management Plan
• GEN-E15811-D04-00001, Logistics and Transportation Plan
• GEN-E15811-F01-00001, Project HSE Management Plan
• GEN-E15811-C01-00003, Procurement Procedure
• GEN-E15811-C01-00004, Material Tracking Procedure
• GEN-E15811-D04-00003, Custom Clearance Procedure
• GEN-E15811-C04-00004, Site Procurement Procedure

5.0 RESPONSIBILITY

The Site Material Management Group has a responsibility for ensuring the
implementation of site material management procedures and control of material from
receiving to issue for fabrication/construction. See the Site Material Management Plan.

The Site Material Manager (SMM) shall liaise with Project Procurement Team (JOPT)
on materials delivery schedule and advice of problem areas.

Additional specific responsibilities for the Site Material Management Group may also
be described in this procedure and in the other procedure.

The Site Material Management Group is composed of the SMM, Site Material Control
Engineer, Local Logistics Officer, Custom Clearance Officer, Construction Materials
Control Engineer and Quality Control Manager and they will report functionally to their
respective area manager / office and will report operationally to the SMM.

The Site Material Management Group is also composed of the Construction Manager,
Commissioning Manager, Quality Manager, HSE Manager, Security Manager, and
Construction Equipment Control Manager.

6.0 SITE MATERIAL MANGEMENT

The objective of Site Material Management is to continue the material management

effort initiated in the office with specific emphasis on supporting the daily construction
effort. The process of material management at the site includes the following elements:

Page 5 of 18
Gbaran Ubie IOGP (E-15811) SITE MATERIAL MANAGEMENT PROCEDURE
DAEWOO DN-54 GEN-E15811-C04-0002-C03

• Receiving materials and inspecting for conformity to Purchase Order

requirements

• Protecting and storing materials until issued for fabrication / erection

• Issuing materials for fabrication / erection

• Warehousing and physical inventories to assure that actual quantities on

hand match recorded quantities

• Handling, control and administration of hazardous and toxic materials

shall be performed in accordance with Government Authority and SHELL
requirements. The concerned individuals shall be aware of the Material
Safety Data Sheet (MSDS) instructions for handling these types of
materials

• Administrating returnable items such as shipping containers, cable reels,

drums, for timely return.

• Monitoring of planned deliveries according to the project schedule

6.1 FILE SETUP AND ADMINISTRATION

Site Material Management will organize the maintenance and administration of

files, documents and registers in accordance with the guidelines set down in the
Project Execution Plan. The material control system introduced shall be
electronic with certain manual backup documentation, electronic and manual or
purely manual.

Even though the local purchase approval document and details are contained in
the electronic material control system, a hard copy of each purchase approval
document and related change order will be filed numerically in a separate folder
in the Site Material Team.

For imported materials, all shipping documents as well as purchase order

documents will be provided and filed by electronic file in the Site Common
Server.

6.2 MATERIAL RECEIVING

• Site Material Manager(SMM) will be responsible for the receiving and

unloading functions at the Project site. All incoming shipments will be
routed via Site Material Manager(SMM) to pre-planned locations, for
receipt and unloading. Under no circumstances should material or
equipment be held for more than 24 hours without processing. The

Page 6 of 18
Gbaran Ubie IOGP (E-15811) SITE MATERIAL MANAGEMENT PROCEDURE
DAEWOO DN-54 GEN-E15811-C04-0002-C03

receiving locations will be controlled areas to preclude any material being

issued prior to its being properly received, inspected, and documented.

• On shipments where materials and equipment are delivered via shipping

container, a daily check will be performed on the activity of shipping
containers (placing, unloading or removing) to minimize or avoid any
demurrage charges against the shipment.

• As soon as the materials arrive, the Site Material Control

Engineer(SMCE) shall make a first check to ensure if the package
corresponds with the packing list and whether the material (as far as
can be inferred from their outward appearance) are in good condition.
Each consignment must be thoroughly checked for damage prior to
unloading. When there is obvious damage, photographs will be taken
before unloading. Damage reporting will be accomplished in accordance
with job site procedures. The consignment will be unloaded in the
designated area. If damages are evident, further inspection will be made
and additional photographs will be taken if needed.

The consignment will be physically checked to ensure that receipts are

in accordance with the accompanying shipping documents, and that the
correct number of packages or items has been received and circled on
the shipping documents. Discrepancies or damages will be noted on the
freight bill and signed by the receiving individual and the carrier's
representative.

6.3 CHECK AND INSPECTION

Material check and inspection shall be executed under management of the

Quality Control Manager (QCM). The SMM shall provide the QCM with
applicable vendor documents, such as mill certificates, inspection / test reports,
Material Safety Data Sheets, and notify QCM that materials are ready for
inspection. Material checks should be handled as follows

- When factory sealed packages of materials have the quantity and

description clearly marked on the package, it is not necessary to
make a detailed piece count of each package. Random spot
checks of individual packages can be made.

- When tally sheets are provided with mill shipments of pipe, it is not
necessary to check each length against the tally. Piece count and
approximate length match ups are sufficient

- A piece-count and check of tag numbers is required for deliveries

of all loose items or packaged tagged items. All accessories,
assemblies and spare parts shipped with tagged items are to be
received as sub-items and marked with the tag number

Page 7 of 18
Gbaran Ubie IOGP (E-15811) SITE MATERIAL MANAGEMENT PROCEDURE
DAEWOO DN-54 GEN-E15811-C04-0002-C03

- A piece-count and check of mark numbers is required for

deliveries of fabricated pipe and structural steel.

Receipt inspection shall be performed by the QC Engineer, who is assigned by

the QCM, in accordance with the Receipt Inspection Procedure. All items are
HOLD until QC inspection has been performed.

Site Material Manager will coordinate with Engineering and/or Site Quality
Control/Inspection and/or Construction Manager when special technical
inspection is required. Materials requiring Positive Material Identification (PMI),
as outlined in the Project specifications, shall be coordinated, handled and
recorded by Site Material Management.

6.4 MATERIAL RECEIVING REPORT (MRR)

All receipts of material/equipment, rentals, and services acquired against

purchase orders must be recorded by preparation of Material Receiving Reports
(MRR). The QC engineer will be responsible for the preparation of MRR's in
accordance with the purchase order information. After completion of inspection,
MRR shall be initiated by the QC engineer and approved by the Quality Control
Manager(QCM). Distribution of MRR’s and supporting documents will be as per
the Project requirements.

For manually generated MRR’s, "Lot" shipments of fabricated pipe, fabricated

structural steel, grating, and other material which is identified by mark piece
number may be identified on the MRR with the following statement:

"This MRR is issued to acknowledge receipt of material as per attached packing

list #_____________ and consisting of the following mark pieces:" Packing list
copies must then be attached and distributed with the MRR.

The Quality Control Manager or his delegate, prior to distribution, shall approve
manual and if required, hard copy computer generated MRR’s. Daily Receiving
Summaries are prepared each working day or as per Project requirements, to
reflect all receipts of materials and equipment processed during the previous 24
hours. The reports are distributed as required by Construction team.

6.5 HANDLING OVERAGES, SHORTAGES & DAMAGES (OS & D)

In the event any shipment is received with overages, shortages, damages, or

other deviations, the Site Material Control Engineer(SMCE) will initiate an
Overage, Shortage, and Damage (OS&D) Report and the Site Material Manager
shall approve the report

The Site Material Manager will take action to immediately notify Logistics
Manager or Project Procurement Manager of OS&D conditions.

Page 8 of 18
Gbaran Ubie IOGP (E-15811) SITE MATERIAL MANAGEMENT PROCEDURE
DAEWOO DN-54 GEN-E15811-C04-0002-C03

JOPT will be the focal point for coordination of OS&D resolutions. Copies of
OS&D reports will be forwarded to JOPT with results of Site decisions (e.g., to
retain overages, return damaged material, etc.). JOPT will coordinate return
authorizations with suppliers, and will be responsible for any other matters that
affect the terms and conditions of the purchase order.

6.6 NON-CONFORMANCE

When received material/equipment is determined to non-conforming to specified

requirements and non-conformance is the Supplier’s responsibility, segregation
of non-conforming item and actions taken shall be strictly in accordance with the
procedure(GEN-E15811-E13-00007) for the control of Non-conforming Item

6.7 STORAGE OF MATERIAL AND EQUIPMENT

Master Storage Plan

A master storage plan shall be prepared by the Construction Manager and

should be developed prior to the arrival of materials at the Project location. The
following points should be taken into consideration when developing the storage
needs:

z Material delivery schedules and Project philosophy regarding direct

delivery to erection locations and off site fabrication shops.
z Existing available storage facilities such as buildings, tanks, slabs,
prepared areas, etc.
z Completion schedules for substations, control rooms etc. in accordance to
the delivery schedules.
z Weather protection, conformity with warranty requirements, protective
maintenance requirements for outside storage areas, including proper
drainage.
z Special storage needed for hazardous materials as per Authority/SHELL
requirements.
z Special storage requirements for Construction Equipment, Small Tools
and supplies as applicable.
z Safety and security requirements.

Storage facilities shall be classified as warehouse building and open laydown

area.

Warehouse building: A warehouse will be built in Gbaran CPF site. The

warehouse shall be secured against entry and weather and sub-divided

Page 9 of 18
Gbaran Ubie IOGP (E-15811) SITE MATERIAL MANAGEMENT PROCEDURE
DAEWOO DN-54 GEN-E15811-C04-0002-C03

internally in a manner suitable to the area, to enable the location of stored items
to be determined and recorded. In addition the warehouse has one special
room which will be controlled by air conditioner for instrument and special parts.
The warehouse officer shall maintain the Temperature / Humidity Check Record
(Attachment 4) for the areas which require control of temperature / humidity

Open lay-down area: For the storage of large bulk materials, such as large bore
valves, piping materials, pipe supports, a fenced storage yard will be prepared
with proper drainage. A limited number of access gates to the yard for
controlling the flow of materials in and out shall be prepared. Cleanliness and
good housekeeping practices shall be enforced at all times in the storage area.
The storage area shall be cleaned as required to avoid the accumulation of
trash, discarded packing materials, and other detrimental soil.

Access to storage facilities shall be controlled and limited only to personnel

designated by the warehouse officer and all materials shall be in accordance
with the manufacturer’s instruction and preservation procedure

Inside Storage

z Materials shall be segregated by material commodities.

z Shelf storage within the different commodities where codes and sizes
apply shall be by type and ascending code sequence.
z Tagged items shall be by type and ascending tag numbers.
z Bulk storage to be used where feasible.
z Wherever possible materials, even though not designated for inside
storage and provided that space is available, should be stored inside to
minimize weather protection.

Outside Storage Areas

z Storage areas shall be, where feasible, divided into bays.

z Storage areas must be accessible for transport and construction
equipment with hard standing roads of sufficient width.
z Materials and equipment stored outside shall be stored off the ground by
the use of sleepers, dunnage, pallets, concrete slabs etc.
z Segregation shall be by material commodity.
z Storage within the different commodities where item codes and sizes
apply shall be by type, size and numerical item code sequence.
z Storage areas shall be assigned locations that facilitate the material
control system that has been implemented.

Page 10 of 18
Gbaran Ubie IOGP (E-15811) SITE MATERIAL MANAGEMENT PROCEDURE
DAEWOO DN-54 GEN-E15811-C04-0002-C03

z Sensitive items stored outside shall be covered with tarpaulins, plastic, etc.
as appropriate.

6.8 MATERIAL AND EQUIPMENT STORAGE REQUIREMENTS

Storage of hazardous materials is to be as per the Material Safety Data Sheets

(MSDS) and in accordance with Authority and SHELL requirements. The
requirements for storage are divided into four levels with respect to protective
measures to prevent damage, deterioration, or contamination of items and
materials based upon important physical characteristics - the ambient conditions
during construction installation and operation of the item or material.

LEVEL A - Items classified to Level A are exceptionally sensitive to

environmental conditions and require special measures for protection from one
or more of the following effects: temperatures outside required limits, sudden
temperature changes, humidity and vapors, gravitational (g) forces, physical
damage and airborne contamination (e.g., rain, snow, dust, salt spray, fumes).
The following shall be used as a guide for classifying and storing items intended
for Level A classification:

• Special electronic equipment and instrumentation

• Special materials, such as chemicals, that are sensitive to environment
• Computers

Items will be stored within a fire-resistant, tear-resistant, weather tight, and well-
ventilated building or equivalent enclosure, with any additional requirements
detailed by the manufacturer and/or engineering representative.

LEVEL B - Items classified to Level B are sensitive to environmental conditions

and require measures for protection from the damaging effects of one or more
of the following: temperature extremes, humidity and vapors, gravitational (g)
forces, physical damage and airborne contamination. The following shall be
used as a guide for classifying items intended for Level B classification:

• Instrumentation
• Electrical penetrations
• Batteries
• Welding electrode and wire
• Motor control centers, switchgear, and control panels
• Motors and generators
• Precision-machined parts
• Erection spares, such as gaskets and O-rings
• Air-handling filters

Items will be stored within a fire-resistant, tear-resistant, weather tight, and well-
ventilated building or equivalent enclosure.

Page 11 of 18
Gbaran Ubie IOGP (E-15811) SITE MATERIAL MANAGEMENT PROCEDURE
DAEWOO DN-54 GEN-E15811-C04-0002-C03

LEVEL C - Items classified to Level C require protection from exposure to the

environment, airborne contaminants, gravitational (g) forces, and physical
damage. Protection from water vapor and condensation is not as important as
Level B. The following shall be used as a guide for classifying items intended for
Level C classification:

• Pumps
• Valves
• Fluid filters
• Compressors
• Turbines
• Instrument cable
• Thermal insulation
• Fans and blowers

Items will be stored indoors, or equivalent, heat and temperature controls are
not required.

LEVEL D - Items classified to Level D require protection against the elements,

airborne contamination, and physical damage. The following will be used as a
guide for classifying items intended for Level D classification:

„ Tanks
• Heat exchangers and parts
• Accumulators
• Demineralizers
• Evaporators
• Piping
• Electrical cable
• Structural items
• Reinforcing steel

Items may be stored outdoors in well-drained areas.

6.9 PROTECTION AND PRESERVATION

Preservation and maintenance of equipment and materials while in storage and

in-place prior to initial operation will be administered by the Preservation
Manager under the Construction Manager and will be recorded on a “Equipment
and Materials Preservation Inspection Record. A plan and register will be
developed which specifies the particular requirements for each piece or
category of equipment based on FLUOR Engineering and manufacturer or
supplier’s recommendations.

Page 12 of 18
Gbaran Ubie IOGP (E-15811) SITE MATERIAL MANAGEMENT PROCEDURE
DAEWOO DN-54 GEN-E15811-C04-0002-C03

6.9.1 Measures to Protect and Preserve

The main operations involved in material handling for itemized equipment and
materials are to:

• Check materials arrived against Purchase Order and packing list and issue
the material receiving report.
• Perform required material inspection by the discipline inspector to verify
material integrity.
• Check the integrity of the original packing protection: if needed restore the
required protection for field storage.
• Define inspection / preservation program during storage / erection
• Move the material / equipment to the proper storage area according to the
storage requirement for materials
• Check periodically the material / equipment storage conditions according to
the inspection program: perform periodically the scheduled preservation
operations.

All equipment and materials will be handled, transported and stored in

accordance with CONTRACT requirements, Project specifications and vendor
recommendations. All stored materials and equipment will be properly identified
and marked, and their storage location will be recorded at all times for easy
traceability purposes when issued to production.

The following is the general procedure that is normally adopted for storage and
preservation of equipment and materials. Nevertheless specific preservation
procedures, in accordance with SHELL / vendors specification/requirements,
will be followed for different type of project material/equipment/machinery and
different term (short or long) of preservation, if it will be necessary.

6.9.2 Significant Considerations

In Nigeria there are several natural situations that have to be considered,

connected to the preservation of the Project materials, such as:

• Moisture
The continuous and heavy moisture present in the country must be opposed
with adequate protective coatings and/or housing and coverings for those
Project materials that can not be stored in an open area without protection
(i.e. electrical panel and small fittings)

• Temperature

Page 13 of 18
Gbaran Ubie IOGP (E-15811) SITE MATERIAL MANAGEMENT PROCEDURE
DAEWOO DN-54 GEN-E15811-C04-0002-C03

Elevated temperature may damage some Project material (e.g. material for
painting). Housing with air-conditioning facilities will be the adequate solution

• Water during the rainy season

During the rainy season, the protection treatment for the area reserved to
the materials and equipments must be taken such as drainage work of
adequate trenches in order to naturally drain the water and to keep the area
unchanged.

• Cleaning of the storage area

One of the most important thing for the preservation of the materials and
equipments is to keep the storage area cleaned.
The high grass or dirty area can be natural habitat of snakes, vermin or other
animals that could be dangerous to man. Then in the storage area mowing
grass and cleaning have to be done regularly.
The Site Material Management Group shall take into consideration of the
above factors which might be impacted against the preservation of materials
and equipments during the site preparation of the lay-down area which will
be flat graded with gravel on top.
Part of the area will be covered and sheltered warehouse equipped by
shelving.

6.9.3 Preservation

Depending on their nature, materials will be preserved as follows.

Piping fittings and valves: for all material shipping protection will be maintained
until prefabrication and/or installation

In addition, shipping crates will be maintained for the materials stored outside.
Crates will be protected from rain by tarpaulins, plastic film, zinc or other.

For mechanical equipment, shipping protection will be maintained until

installation, and the following issues will be controlled, at intervals, when
required:

• Moisture content
• Oil level
• Shaft rotation

The above issues will be developed (treatment of NCRs, security, etc), as part
of the project documentation.

Page 14 of 18
Gbaran Ubie IOGP (E-15811) SITE MATERIAL MANAGEMENT PROCEDURE
DAEWOO DN-54 GEN-E15811-C04-0002-C03

Protective housings and coverings will be applied to reduce deterioration from

the environment. These may be plywood boxing over rotating equipment, tape
coverings over exposed motor/pump shafts, or polyethylene bags over
instruments (inside only). If this type of protection is vapour tight, it keeps dust,
sand, rain, dew and salts from exposed surfaces. Coverings will also retard
oxidation or “drying out” of greases or oils applied to machined surfaces.
Covering of motor, turbine and compressor air inlets and taping over applied
protective greases is recommended.

If the equipment is designed for outside exposure, enclosing with box and/or
using plastic bags is generally not encouraged.

All preservation activities shall be performed by the Preservation Discipline

Manager under the Construction Manager in accordance with the Preservation
Procedure.

6.9.4 Quality Control during Storage

The quality control activities during storage will be carried out according to
Quality Control Plan.

Detailed written instruction as referred to in the applicable Quality Control Plan

and related Check-list will be supplied to all inspection areas specifying the
procedures to be followed to ensure conformance of inspected items to the
applicable requirements

The Quality Control activities will be performed by appropriately qualified

personnel. Written reports will be issued for each completed inspection

Inspection items will be marked accordingly in order to assure correct

identification of their inspection status, and relevant release reports issued
accordingly. Non-confirming items will be processed as per the established
procedure

6.10 ISSUE OF MATERIALS AND EQUIPMENT

Site Material Manager shall issue shortly materials and equipment to the
Construction Discipline Manager upon completion of receiving inspection and
receiving MRR from QA/QC Team. Material Issue Ticket form (Attachment 7)
shall be used for issuance of materials. Following issue of material to
Construction Team, the storage and inventory shall be controlled by the
Construction Discipline Team

Page 15 of 18
Gbaran Ubie IOGP (E-15811) SITE MATERIAL MANAGEMENT PROCEDURE
DAEWOO DN-54 GEN-E15811-C04-0002-C03

All the issued materials shall be recorded in the electronic material control
system with Material Inventory Check List (Attachment 3) by the Site Material
Control Engineer and the warehouse officer.

The Site Material Team shall make a periodic inventory checking for stock
status and monitor the status of shortage / proper storage

7.0 SITE PROCUREMENT

Site procurement will be in line with the Nigerian / Local Content Policy. The Site
Material Manager will conduct local procurement for material, equipment and services,
maximizing the use of local sources to the extent they are available and technically
acceptable, price competitive and can be delivered in time to suit the Project schedule.

Upon issue of a Material Requisition from the site, Site Material Manager will survey
the local market versus external availability and cost to obtain the necessary approval
as per project requirements.

DAEWOO intends to purchase the following items from the local supplier, partly or
wholly, depending on the availability and meeting specification.

• Sand and aggregates

• Cement

• Rebar

• Wire mesh

• Carbon steel vessels (less than 75mm in thickness)

• Consumables

Procurement will be normally via local purchase orders but cash purchases subject to
items to be procured and order value

All activities for the above site procurement shall be in accordance with the Site
Procurement Procedure.

8.0 DISPOSITION OF SURPLUS MATERIALS

In the event that materials at the site have been identified as surplus, the disposal of
that surplus material is the responsibility of the Material Management group. Surplus
material is most often the result of design changes, errors in estimates and takeoff,
and/or duplicate buying efforts.

Page 16 of 18
Gbaran Ubie IOGP (E-15811) SITE MATERIAL MANAGEMENT PROCEDURE
DAEWOO DN-54 GEN-E15811-C04-0002-C03

Once surplus has been confirmed, the Site Material Manager shall closely coordinate
with the Project Procurement Manager and Construction Manager and has the
responsibility for leading the work process to disposition the surplus material /
equipment and working with Site Engineering to identify possible alternative uses prior
to disposition

9.0 DOCUMENT FORMS

The table in Attachment provides a listing of the forms that will generally be used while
performing Site Material Management activities on the Project. They are used in the
execution of receiving, storage, handling, preservation and issue of equipment and
material for construction and return of the surplus items.

• MATERIAL RECEIVING REPORT: Used for material receiving/inspection by

QC engineer and Quality Control
Manager

• OS&D Report: Used for overages, shortages and damages report by SMCE
and SMM

• Material Inventory Check List: Used for material inventory by SMCE and
warehouse officer

• Temperature/Humidity Check Record: Used for control of warehouse

temperature / humidity by the warehouse
officer

• Storage Control Inspection Report: Used for checking periodically material

storage conditions by warehouse officer

• DAILY RECEIPT SUMMARY REPORT : Used for recording material received

on daily basis by Material Control Officer

• Material Issue Ticket(MIT): Used for issuance of materials by SMM

• Material Return Ticket(MRT): Used for return of surplus materials by CM

The information on site material management activities, such as receiving and issue
for construction, shall be updated on Procurement Control / Progress Report, which is
an integrated material tracking report from requisition to issue for construction and
issued to SHELL on weekly basis, by the Project Schedule Controller under the Project
Control Team in accordance with the Material Tracking Procedure

Page 17 of 18
Gbaran Ubie IOGP (E-15811) SITE MATERIAL MANAGEMENT PROCEDURE
DAEWOO DN-54 GEN-E15811-C04-0002-C03

If any forms have been modified due to SHELL or Project requirements, they are
included as attachments in the following section.

10.0 ATTACHMENTS

Attachment 1. Material Receiving Report (MRR)

Attachment 2. Overage, Shortage, and Damage (OS&D) Report
Attachment 3. Material Inventory Check List
Attachment 4. Temperature / Humidity Check Record
Attachment 5. Storage Control Inspection Report
Attachment 6. Daily Receipt Summary Report
Attachment 7. Material Issue Ticket (MIT)
Attachment 8. Material Return Ticket (MRT)

Page 18 of 18
ATTACHMENT 1. (GEN-E15811-C04-00002)

Gbaran Ubie IOGP (E -15811) DAEWOO DN-54

MATERIAL RECEIVING REPORT(MRR)

MRR No. : PO No. :

SIR No. : VENDOR :

CERTIFICATE/ INSPECTION
No ITEMS DESCRIPTION Unit Q’ty SPEC ID NO. Remark
MILL SHEET NO RESULTS

I.D No of Equipment NCR No.

used (If applicable)

A : Accept, H : Hold, N/A : Not Applicable

Certificate/Mill Sheet
Attachment Others

Inspected By :

Approved By :

Form No. : GEN-E15811-C04-00002-01(0)

ATTACHMENT 2. (GEN-E15811-C04-00002)
Gbaran Ubie IOGP (E -15811) DAEWOO DN-54

Overage, Shortage, and Damage (OS&D) Report

Project Name : Gbaran Ubie Integrated Oil & Gas Project (E-15811) Page of

Report No. : VENDOR :

P.O No. : MRR No. :

Item :

Equipment Tag No :

Description :

Photograph ( ) Yes / ( ) No

Recommended Action.

Effect on Schedule ( ) / Cost ( )

Prepared By : Date :

Approved By : Date :

Clear of Discrepancy ( ) Yes / ( ) No

Prepared By : Date :

Approved By : Date :

Form No. : GEN-E15811-C04-00002-02(0)

 Material Inventory Check List
PJ:Gbaran Ubie IOGP
Control Voyage Abam CPF MRR MIT
Item PO No. SRN No. P'kgs SITE STORAGE AREA Remark
No. SITE JOPT Arrival Arrival ISSUED C/NO ISSUED TEAM RECEIVED BY NO
 ATTACHMENT 4. (GEN-E15811-C04-00002)
Gbaran Ubie IOGP (E -15811) DAEWOO DN-54
Temperature / Humidity Check Record
1. Location 2. Storage Level : 3. Year/Month :

Temperature(`C) / Humidity(%) Checked By

Date
10 : 00 17 : 00 Signature Date
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
Form No. : GEN-E15811-C04-00002-04(0)
 ATTACHMENT 5. (GEN-E15811-C04-00002)
Gbaran Ubie IOGP (E -15811) DAEWOO DN-54
1. Record No.
Storage Control Inspection Report
2. Date

3. Storage Facility(Location) 4. Storage Level

6. Result
No 5. Inspection Item Remark
Accept Reject N/A
5.1 Inspection of Storage Facility

Access to Storage Area

Cleanness and Housekeeping Practices

Fire Protection

Storage of Food and Associated Item

Measures to Prevent Entrance of Animals

Temperature and Humidity Control

5.2 Inspection of Storage Methods

Ready Access to Stored Items

Arrangement of Hazardous Materials

Identification

Coverings

5.3 Inspection of Control Methods

Identification and Marking

Protective Covers and Seals

Coatings and Preservations

Desiccants and Inert Gas Blankets

Physical Damage Check

Cleanness Check

7. Inspected By :

8. Verified By :

Form No. : GEN-E5811-C04-00002-05(0)

ATTACHMENT 6. (GEN-E15811-C04-00002)

DAILY RECEIPT SUMMARY REPORT

Date :

Gbaran Ubie IOGP (E-15811) DAEWOO DN-54

No Items Description Unit Q’ty P.O No Vendor Remark

Received By :

Approved By :

Form No. : GEN-E15811-C04-00002-06(0)

ATTACHMENT 7.(GEN-E15811-C04-00002)

Material Issue Ticket(MIT)

(IMPORTED)
FOR MATERIAL DEPT
Gbaran Ubie IOGP (E-15811) PROJECT DAEWOO DN-54
MIT NO DATE REQUESTED REQUESTED BY RECEIVED BY SIGN GOOD AVERAGE BAD(RETURN) REMARK(MRR No.)

Q'TY Q'TY
SCN DESCRIPTION SPEC UNIT BALANCE PO NO. REMARK
REQUESTED ISSUED
1
2 -
3 -
4 -
5 -
6 -
7 -
8 -
9 -
10 -
11 -
12 -
13 -
14 -

DATE ISSUED TIME ISSUED ISSUED BY SIGN COMFIRMED BY SIGN REMARK

PAGE : 1 / 1
ATTACHMENT 8. (GEN-E15811-C04-00002)

Gbaran Ubie IOGP (E -15811) DAEWOO DN-54

Material Return Ticket(MRT)

MRT No Date Department Name Sign MIT No WBS Code Receiver Sign Date
Returned Name

SCN Description Short Spec Unit Q’ty Returned Cause Remarks

Accepted By(QC)

Form No. : GEN-E15811-C04-00002-08(0)