On Site Material Management Procedure

Transnet Capital Projects Construction Management On Site Material Management Procedure 27 August 2008

I-TEM-0473-ZA01 -0 Doc No.HMG-CO-P-009, Rev. 3, Page ii

Table Of Contents

1. Purpose.................................................................................................................................1

2. Scope ....................................................................................................................................1

3. References............................................................................................................................1

4. Responsibilities ....................................................................................................................1

5. Procedure .............................................................................................................................1

5.1 Systems ........................................................................................................................... 15.2 Receiving And Shipping...................................................................................................... 25.3 Storage And Issuing .......................................................................................................... 25.4 Interface Guidelines .......................................................................................................... 25.5 Ethics............................................................................................................................... 35.6 Organisation ..................................................................................................................... 35.7 Warehousing Positions....................................................................................................... 3

5.7.1 Field Material Manager.............................................................................................. 35.7.2 Warehouse / Laydown Yard Supervisor ...................................................................... 35.7.3 Warehouse / Laydown Yard Material Controller ........................................................... 45.7.4 Warehouse / Laydown Technician (where required) .................................................... 4

5.8 Warehousing / Laydown Yard And Material Control .............................................................. 45.8.1 Introduction............................................................................................................. 45.8.2 Purchase Order Filing System .................................................................................... 45.8.3 Warehouse / Laydown yard Master File ...................................................................... 45.8.4 Physical Receipt of Materials and Equipment............................................................... 55.8.5 Processing ............................................................................................................... 55.8.6 Material Receipt and Check ....................................................................................... 65.8.7 Processing ............................................................................................................... 65.8.8 Handling Over, Short and Damaged Shipments ........................................................... 65.8.9 Handling Standard Packing........................................................................................ 75.8.10 Handling Quantity Variances...................................................................................... 75.8.11 Manual Inwards Goods Receipt Reports...................................................................... 75.8.12 Preparation and Distribution ...................................................................................... 75.8.13 Weekly Receiving Summary....................................................................................... 85.8.14 Computer Generated Inwards Goods Receipt Reports .................................................. 85.8.15 Warehouse / Laydown Yard Receiving Inspection Procedure ........................................ 8

5.9 Warehouse / Laydown Yard Storage And Preservation.......................................................... 85.9.1 Master Storage Plan.................................................................................................. 9

5.10 Storage Procedure............................................................................................................. 95.10.1 Material Groups........................................................................................................ 9

5.11 Physical Storage Inside .................................................................................................... 105.11.1 Shelving: ............................................................................................................... 105.11.2 Methods Of Storage................................................................................................ 10

5.12 Physical Storage Outside.................................................................................................. 105.12.1 Housekeeping ........................................................................................................ 115.12.2 Location Control ..................................................................................................... 11


I-TEM-0473-ZA01 -0 Doc No.HMG-CO-P-009, Rev. 3, Page iii

5.12.3 Material / Equipment Storage Requirements ............................................................. 115.12.4 Storage Requirements ............................................................................................ 12

5.13 Material Control And Issue ............................................................................................... 125.13.1 Issue Of Material .................................................................................................... 125.13.2 Requisitioning Materials .......................................................................................... 135.13.3 Warehouse / Laydown yard..................................................................................... 135.13.4 Requester – Receive Materials ................................................................................. 135.13.5 Material Control Filing ............................................................................................. 135.13.6 Returns Of Material ................................................................................................ 145.13.7 Material Requirements Planning............................................................................... 145.13.8 Schedule ............................................................................................................... 145.13.9 Requirements......................................................................................................... 145.13.10 Inventory............................................................................................................... 145.13.11 Equipment/Materials Due In .................................................................................... 145.13.12 Allocation Of Material.............................................................................................. 14

5.14 Out-Bound Shipments...................................................................................................... 15

6. Records...............................................................................................................................15

Annexure 1 - Over, Short and Damage Report – HMG-CO-FM-014 ........................................16

Annexure 2 – Inwards Goods Receipt Reports – HMG-CO-FM-015........................................17

Annexure 3 - Over, Short and Damage Log – HMG-CO-FM-016 ..............................................18

Annexure 4 - Material Shipping Record – HMG-CO-FM-017....................................................19

Annexure 5 - Field Material Request - HMG-CO-FM-018 .........................................................20

Annexure 6 - Field Material Return - HMG-CO-FM-019 ...........................................................21

Annexure 7 – Release Note - HMG-CO-FM-020 .......................................................................22

Annexure 8 - Field Material Issue Note - HMG-CO-FM-065.....................................................23

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I-TEM-0473-ZA01-0 Doc No.HMG-CO-P-009, Rev. 3, Page 1

1. PurposeTo establish the requirements and responsibilities for the implementation of an effective material management system for Transnet Projects.

2. ScopeAll projects requiring on site materials management.

3. ReferencesISO 9001

4. ResponsibilitiesThe responsibilities for the implementation of these requirements will rest with the materials management personnel under the direction of the field Material Manager, who reports to the Project Site Construction Manager. Responsibilities for Material Management and procurement at the Project site include the following:

Obtaining all goods required by construction that are not provided by Project Procurement, Client, or a third party

Developing and executing a site material management and contracting plan

Implementing and maintaining systems to manage site material management activities

Processing all valid requisitions

Soliciting and evaluating bids

Recommending and obtaining approvals for purchase

Issuing purchase orders and change orders

Expediting equipment, material deliveries, and services

Maintaining purchasing records

Co-ordinating purchasing activities with the home office

5. Procedure

5.1 SystemsThe Project will utilise established Transnet Projects material management systems (like iPAS) interfaced to ensure a smooth flow of material status reporting. The material management group will coordinate and develop methods for warehouse computer interfaces with other locations as required.



Maintain electronic logs and files for purchase orders and receiving reports, transfers of material, material shipping records, field material requisitions, and engineered bills of material.

5.2 Receiving And Shipping Material Management will be responsible for the receiving and unloading functions of all material and equipment cargo for the project. A dedicated controlled receiving area will be established to ensure cargo is properly received, inspected, and documented before storage or issue.

Perform physical checking of material and equipment against packing list and purchase order documentation.

Note any overages, shortages and damages and ensure that all such cases are documented by Overage, Shortage, & Damage Reports. Monitor all OS&D's to an acceptable conclusion (See Annexure 1 - Overage, Shortage, And Damage Report HMG-CO-FM-014).

Request technical inspection by Engineering and Site QA/QC as required.

Produce Inwards Goods Receipt Reports to document all material and equipment receipts (See Annexure 2 - Inwards Goods Receipt Report HMG-CO-FM-015).

5.3 Storage And Issuing Establish and maintain outside laydown yards and covered warehouse storage areas (where required) in accordance with established project procedures and accepted practices. "In storage" preventive maintenance as required on critical items of material and equipment, in outside storage areas, will be performed by others.

Issue required materials to authorized personnel with accompanying documentation. (See Annexure 8 for Materials Issue Note HMG-CO-FM-065)

5.4 Interface Guidelines Materials and equipment may account for as much as 50 - 60% of the total cost of a project. This means that effective material management and warehouse plans and practices, if devised early in the life of the project, and supported by project management can significantly reduce the cost to the project.

The Field Material Manager and his staff must be team players. It is vital that good communications be maintained with all project elements. In particular, emphasis must be placed on early liaison and planning sessions with:

Project Management

Construction Management

Project Controls

Quality Management Material

Management Construction

Engineering Field Accounting

Safety



Contracts

Warehouse operating methods and plans must be consistent with the overall goals established by project management, flexible enough to ensure that constructability is maximized, and provide optimum support to all members of the construction team.

5.5 EthicsMaterial Management functions involve frequent contact with suppliers; the handling of large quantities of valuable goods, and the commensurate level of responsibility of ethics is an integral part of this function.

5.6 Organisation For the purpose of this basic practice, the Field Material Manager reports operationally to the relevant Construction Manager and to the Programme Material Manager on a functional level.

This practice will be utilised by Warehouse Supervisor, lead material personnel and field management in establishing an organisation for site warehousing for the Project.

5.7 Warehousing Positions Based on the size and complexity of the project, the following field positions may be required.

5.7.1 Field Material Manager This position is only described here to show the link of Field Material Management to the overall Project Material Management responsibility.

The Field Material Manager (MM) reports directly to the Construction Manager and is responsible for the planning and controlling of all the efforts necessary to ensure that the correct quality and quantity of materials and equipment are available at the point of use when required.

5.7.2 Warehouse / Laydown Yard Supervisor Under administrative direction of the Field Material Manager, the Supervisor is directly responsible for all material activities. The Supervisor ensures that activities are conducted in compliance with established procedures and directs the actions to be taken by material personnel to establish storage areas and to monitor the storage and control of equipment and materials from time of receipt until issue.

The Supervisor establishes and conducts training programs for new employees in procedures and keeps personnel informed of requirements and commitments in regard to all operations.

Under general direction, but with extensive latitude for independent judgment and initiative, the supervisor supervises and directs technical, clerical, and craft personnel in the performance of a variety of material management assignments.

The Supervisor ensures that all activities are conducted in compliance with established procedures and accepted practices.

The Supervisor coordinates the project material management effort with all other project departments.



5.7.3 Warehouse / Laydown Yard Material Controller Material Controller is an intermediate level position performing high-level technical assignments in material management functions; may have lead responsibilities for clerical, technical, or craft employees.

Trains new personnel in all aspects of the material management function.

5.7.4 Warehouse / Laydown Technician (where required) The Technician performs a variety of assignments, both technical and clerical, to receive, inspect, store and issue material and equipment; receives general direction on new aspects of assignments and instructions as to required tasks and results expected.

5.8 Warehousing / Laydown Yard And Material Control This practice establishes guidelines of the set up for a field warehouse/laydown yard and record keeping.

5.8.1 IntroductionThe timely and accurate receipt and processing of materials and equipment is one of the most critical aspects of field operations. Efficient material/equipment receipt, inspection, and documentation are essential to ensure a smooth flow of requirements to construction activities, provide detailed and current material status reporting, and assure prompt payment of supplier invoices.

This procedure provides detailed instructions to:

Establish and maintain necessary files and registers, physically receive and inspect materials and equipment, Process Inwards Goods Receipt Reports, Prepare and distribute reports.

5.8.2 Purchase Order Filing System Material Management will maintain purchase order files; the following are the filing systems:

5.8.3 Warehouse / Laydown yard Master File Hard copies of each purchase order document and related change order will be filed in a separate folder in the material management office area. Associated documents such as IGR’s, packing lists, freight bills, faxes, etc., will be filed in the same folder as the referenced purchase order. The following guidelines are applicable to the preparation and maintenance of the purchase order folder:

The purchase order number, supplier name, and a brief description of the commodity will identify each file folder tab.

File contents may be organized in the following manner:

Left-Hand Side Right-Hand Side

OS& D reports, IGR’s, packing lists, MSR forms, deficiency reports, freight bills, material safety data sheets, fax messages, and other relevant documentation.

Copy of purchase order and change orders filed in numerical sequence.



Each purchase order and change order received by the Material Management group will be recorded in a Purchase Order Register. A separate Purchase Order Register can be maintained for each commodity, account, or other classification, if desired.

Purchase order files will be maintained in purchase order number sequence.

When a purchase order file becomes too bulky, an accompanying folder may be opened to hold IGR’s and supporting documents.

Individuals wishing to review purchase order folders must obtain approval from the Field Material Manager or designee. A card sign out method should be used when removing purchase order folders for review or update.

NOTE!!! UNDER NO CIRCUMSTANCES ARE PURCHASE ORDER FOLDERS TO BE REMOVED FROM THE FILE BY UNAUTHORISED PERSONS DUE TO CONFIDENTIAL PRICING AGREEMENTS.

At the Field Material Manager's option, a separate filing area may be established for closed purchase order file folders. A closed file can be reopened upon receipt of a new change order for a closed file.

At job completion, "open" purchase order files will be forwarded to the Purchasing Department for reconciliation and close-out.

5.8.4 Physical Receipt of Materials and Equipment The warehouse/laydown yard receiving section will perform receiving and unloading functions at the project site. An area within the warehouse/laydown yard will be designated as the Receiving Area. Incoming shipments will be routed to this area for receipt and unloading, or as needed rerouted to other areas for unloading. The Receiving Area will be a controlled area to preclude any material being issued prior to its being properly received, inspected, documented and having an accompanying Release Note.

Release Note:

A document generated by Transnet Projects and issued to the supplier or fabricator allowing him/her to release whatever item from the supplier/fabricator premises to the Construction Site.

This document will only be generated by Transnet Projects after it has inspected and accepted the supplied/fabricated items at the supplier/fabricators yard, inspection may include items like quality, etc.

See Annexure 7 for Release Note (HMG-CO-FM-020).

5.8.5 Processing All incoming materials and equipment will be checked by receiving personnel as soon as possible. Under no circumstances will material or equipment be held for more than 48 hours without processing, unless non-working hours are involved.

Warehouse/laydown yard receiving will receive all accompanying documentation.

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 a designated area. If damages are evident, further inspection will be made and additional photographs will be taken if needed.

Discrepancies/damages will be noted on the freight bill and signed by the receiving individual and the carrier's representative.

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.

Over-shipments, damaged items, and items not as ordered will be reviewed, by necessary personnel and an over, short and damage report issue.

5.8.6 Material Receipt and Check Material receipts (cases, boxes, etc.) will be opened and checked against the packing list and purchase order. If the packing list does not contain sufficient information, add any necessary details.

5.8.7 Processing Material designated for storage in outside laydown areas will be checked and located by the laydown area supervisor. Material designated for storage in the warehouse will be moved to the appropriate storage area. In all cases, locations will be noted on packing lists.

The packing list will be stamped with the Material Receipt stamp.

All variances to the packing list will be clearly noted and actual quantities received will be marked and circled on the packing list.

The warehouse receiving individual will coordinate with Engineering and/or Site QA/QC when special technical inspection is required.

Upon completion of receiving, checking, and inspection, all receiving documents will be sent to the warehouse systems group for further processing.

5.8.8 Handling Over, Short and Damaged Shipments Over, Short, and Damaged Shipments will be handled as follows:

In the event any shipment is received with overages, shortages, damages, or other deviations, the Warehouse/Laydown yard will initiate an Overage, Shortage, and

Damage (OS&D) Report (See Annexure 1 - Overage, Shortage And Damage Report HMG-CO-FM-014).

For Transnet Projects Intercontinental purchases, the warehouse/laydown will take action to immediately notify home office or local supplier of OS&D conditions. Since time is critical (suppliers and contractors with OS&D conditions should be notified within 48 hours), the warehouse/laydown yard will be the focal point for coordination of OS&D resolutions. Copies of OS&D reports will be forwarded to purchasing with results of field decisions (e.g., to retain overages, return damaged material, etc.). Purchasing will coordinate return authorizations with



suppliers, and will be responsible for any other matters which affect the terms and conditions of the purchase order.

All shipments involving OS&D reports (for other than over-shipments) will be held intact in a designated hold area, pending written disposition and return of the report to site Material Management by Purchasing.

Following receipt of the dispositional report, Material Management will implement the instructions and make distribution of the completed report in accordance with established job site distribution requirements.

All outbound shipments for the return to suppliers of OS&D material will be documented by the completion of a Material Shipping Record (MSR) (See Annexure 4 – Material Shipping Record HMG-CO-FM-017) and an authorised Release Note to remove the materials from stores control.

Material Management will maintain an OS&D Log for all OS&D reports (See Annexure 3 - Overage, Shortage, And Damage Log HMG-CO-FM-016). Copy of OS&D log will be sent to client on a weekly basis.

5.8.9 Handling Standard Packing Standard Packing will 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 mark numbers is required for deliveries of fabricated pipe and structural steel.

5.8.10Handling Quantity Variances Standard allowance on quantity variances will be handled as follows:

For materials that are traditionally ordered in bulk quantities (i.e., lumber, pipe, wire, cement, etc.), accept the shipment if the variance does not exceed ten (10) percent of the quantity ordered. Initiate an O.S.&D. report only if the quantity variance exceeds ten (10) percent. This does not apply to single unit items, such as valves, flanges, etc. Project management and controls need to agree on the types of goods this can be applied to.

5.8.11Manual Inwards Goods Receipt Reports All receipts of material/equipment, rentals, and services acquired against Transnet Projects Intercontinental purchase orders that are not documented within Material Management System for electronic IGR’s must be recorded by preparation of a manual Inwards Goods Receipt Report (See Annexure 2 – Inwards Goods Receipt Report HMG-CO-FM-015).

5.8.12Preparation and Distribution The warehouse/laydown yard receiving office will be responsible for the preparation and distribution of IGR’s and supporting documents.



The Checker section of the IGR is signed by the receiving person responsible for checking the material or equipment. The Warehouse/Laydown yard section will be signed by the supervisor of the receiving function.

A typical distribution of IGR’s is as follows:

1 copy - Project Procurement department (for distribution to C.A) 1 copy - Warehouse P.O. file 1 copy - Client (if required) 1 copy - Project Cost Engineer

5.8.13Weekly Receiving Summary The Daily Receiving Summary is prepared each Friday to reflect all receipts of materials and equipment processed during the previous week. The report is used to inform all affected departments that materials and equipment have arrived and are available for issue from the warehouse/laydown yard. The project may elect to do this report on a spreadsheet on the site network to be viewed and shared by the project. Typical manual distribution is as follows:

1 copy - Project Manager 1 copy - Construction Manager 1 copy - Field Material Manager 1 copy - Appropriate Superintendent(s)

5.8.14Computer Generated Inwards Goods Receipt Reports The Material Management System (iPAS) is used to generate Inwards Goods Receipt reports for all purchase order items identified within iPAS. Local receipt data is appended to this information by the (iPAS) operator after checking of materials. This method drastically reduces the number of manual documents to be prepared and provides a source of information, which can be extracted and reported in many different formats.

5.8.15Warehouse / Laydown Yard Receiving Inspection Procedure Warehouse/Laydown Yard personnel shall perform the initial visual inspection of materials / items for obvious shipping damage. If there has been shipping damage, initiate OSD report, in accordance with procedures. The Field Engineering Manager shall determine which items of material and equipment will require receiving inspection and provide QA/QC with a list of items to be inspected.

Close liaison between Material Management and Site QA/QC is essential to ensure that methods are established for compliance with receiving inspection and marking requirements relative to alloy, low temperature and special materials.

5.9 Warehouse / Laydown Yard Storage And Preservation Introduction:

Whenever possible, materials and supplies should be stored inside the warehouse. This is particularly true of items which are climate sensitive. Some examples include instruments, pressure gauges, electronic components, and welding rods. Each warehouse should provide a lockup (gold room) area for storage of small tools and other items subject to pilferage.



5.9.1 Master Storage Plan A master storage plan (along with plot drawings) should be developed prior to the arrival of materials at the project location. The following points should be considered:

Outside storage requirements (where applicable):

Material handling equipment/facility requirements such as hand trucks, forklifts, pallet jacks, stencil machines, shelving, pallet racks, additional building needs, etc

Weather protection requirements for outside storage areas, including proper drainage

The need to minimize repeated handling of materials and equipment

Protective maintenance requirements such as power for heaters lube oil mist system, etc

Conformity to warranty requirements (obtain from MFG. or Vendor through procurement)

Location control of stored materials and equipment

Safety requirements, including personnel training, fire prevention, access control, personal protective gear, adequate lighting and ventilation, etc

Warehouse and laydown yard security

5.10 Storage Procedure Inside storage facilities will require bins for the segregation of commodity items. Storage of all commodity items will be identified by the material identification (commodity code) numbers when possible. Material identification numbers are assigned for all pre-defined bulk electrical and piping materials, instrument bulks, and insulation commodities. Some projects may have locally assigned material identifiers for other items such as tagged instruments and consumable.

Material storage methods will be devised to ensure compliance with safety requirements. Fire extinguishers will be prominently located and regularly checked. Aisle spaces will be provided to permit easy and safe access and movement of personnel/material handling equipment. Security methods will be implemented to maintain an acceptable level of personnel access control.

Outside storage areas will be established for storage of large items. These materials must be protected from weather conditions such as extremely high/low ambient temperatures and humidity, sandstorms, flooding, or other local hazards. It is advisable to fence these areas and provide limited access to authorized personnel. All material stored outside must be mounted on dunnage, skids, pallets, or platforms.

5.10.1Material Groups Similar materials will be grouped and stored together when practical. Reinforcing steel and wire mesh.

Embedded items such as curb angle, sumps, anchor bolts, and sleeves. Cast iron, concrete, vitrified clay pipe and fittings

Stock pipe - carbon steel

Prefabricated pipe, segregated by area



Stainless steel pipe, special stainless steels

Equipment - vessels, exchangers, pumps, compressors, drivers, etc., segregated by area. When practical, large equipment will be delivered directly to the foundations or nearest location to allow ease of installation and minimize damage.

Piping material should normally be stored in outside laydown areas. Valves, fittings, flanges, and accessories will be stored by size. Shelf type electrical materials should be stored by size, and within the size by ascending commodity code sequence. Items such as junction boxes, switches, connectors, etc., should be shelf grouped in commodity code sequence.

Stock structural shapes - bar, plate, angle, etc.

5.11 Physical Storage Inside

5.11.1Shelving:If it is necessary to acquire shelving, metal shelves should be purchased rather than constructing wooden shelving.

5.11.2Methods Of Storage Loose material (stud bolts, small bore fittings, etc.) should be dispensed from its original carton when possible. A hole can be cut in one end of the carton and the carton placed on the shelf.

Upon receipt of instruments, a thorough check against the specification should be done, if possible. Instruments should be stored in their cartons and identified by the correct tag number.

5.12 Physical Storage Outside The cardinal rule for outside storage is to keep material out of the mud, and sand. This may be accomplished by the following methods:

Wood pallets should be standard double-faced 1,016 m x 1,220m. These make excellent temporary docks when it is not necessary for the surface to be solid

Cribbage or dunnage can be recycled from used shipping crates or purchased locally to meet specific project needs

Pipe Storage. Generally, pipe should be pyramid stacked. The pipe should be stacked on 150mm x 150mm cribbage with an adequate blocking at the end of each row, which would be nested in the 'V' of the previous row.

Primed pipe should be stored in tiers, with 25mm rough lumber between layers, and adequately placed at the end of each tier.

Drum Storage. Drums should be stored in a horizontal position to prevent ingress of moisture through the bung. The lid and vent holes position should be 3-9 o’clock. When stacking drums in rows, use 25mm rough lumber between tiers, running lengthwise along each end of the drums. Drum rows should be no longer than 12,192m with a maximum of 3 tiers. For very large drum storage areas, space in double rows, each single row 0,610m apart and each set of double rows 0,915m apart. When establishing bays, allot a 12,192m roadway between each bay to allow for crane turning radius.



Valve, Flange and Fittings Storage. All flanged valves should be stored in a vertical position, with the valve stem protected against corrosion and damage, and valve inlets capped to prevent entry of moisture or sand. Valves should be stored by size.

Flanges should be adequately spaced with dunnage to prevent damage to the beveled edges and flange facings. Fittings should be stored by type and size and turned with the opening down to prevent water collection.

5.12.1HousekeepingThe Warehouse/Laydown Yard Supervisor and/or designees will perform a continuous inspection program to ensure that good housekeeping practices are followed in all storage areas. This will include:

Prompt removal of trash and debris

Designation of eating and smoking areas; and application of rodent and pest control measures

5.12.2Location Control After the master storage plan has been finalised, some form of structured locator code system must be employed. The locator system should be sufficiently flexible to accommodate a wide variety of storage schemes. It must be designed to be compatible with the computerised inventory control system (iPAS).

5.12.3Material / Equipment Storage 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 those that 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 vapours, gravitational (g) forces, physical damage and airborne contamination (e.g., rain, dust, salt spray, fumes). The following shall be used as a guide for classifying items intended for Level A classification:

Special electronic equipment and instrumentation

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

LEVEL B - Items classified to Level B are those that 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 vapours, gravitational forces, physical damage and airborne contamination but do not require the special protection required for Level A items. 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 centres, switchgear, and control panels Motors and generators

Precision-machined parts

Erection spares, such as gaskets and O-rings Air-handling filters

LEVEL C - Items classified to Level C are those that require protection from exposure to the environment, airborne contaminants, gravitational forces, and physical damage. Protection from water vapour and condensation is not as important as that for Level B items. 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

LEVEL D - Items classified to Level D are those that are less sensitive to the environment than Level C. These items 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

Demineralises

Evaporators

Piping

Electrical cable

Structural items

Reinforcing steel

5.12.4Storage Requirements Items assigned a level of storage will be maintained at that level until they are removed from storage. Items that are removed from storage (or offloaded upon initial receipt) and are installed but not operating shall have the assigned level of storage maintained.

5.13 Material Control And Issue

5.13.1Issue Of Material Field Material Management shall obtain a list of contractor personnel that will be authorized to request and sign for materials issued from the Project warehouse or laydown area.



When equipment and material are issued to Contractors, such equipment and material shall be deemed to be under the care, custody and control of Contractor until it is passed back to Project material management warehouse/laydown area or accepted and handed-over to Client under the mechanical completion procedures. Such care, custody and control shall include, but not necessary be limited to:

safeguarding against theft or damage

protection against damage during construction preventive maintenance

return of surplus materials in good condition

5.13.2Requisitioning Materials When material is required, the responsible contractor will fill in the Field Material Request (HMG-CO-FM-018) and process as follows:

1. Enter the required quantity in the "Requested" column of the Field Material Request (FMR). 2. Enter a realistic required date 3. Sign the "Issued By" box. The signature must be legible. 4. Take the FMR to the Field Material Control section for material statusing and issuing. For

routine requirements, allow two (3) working days prior to the date the material is required.

Based on project set-up a list of work planned, “work packages” can be utilised to request "all" fabrication category material, provided categories were initially established to allow unnecessary material from being requested/issued prematurely.

Note: Items deemed to be required in less than two (2) working days notice based on schedule changes, etc., will be accommodated, but should be the exception and not the norm.

5.13.3Warehouse / Laydown yard Process issue transaction as noted on the FMR Original. Set backorders for material requirements which are not available. Generate Material Issue Note for warehouse/laydown yard issue. For the ordering of materials/equipment from site please refer the matter to the Procurement department for their relevant procedures.

Note: As Material Issue Notes are generated against a FMR, a current status of remaining quantities is maintained within iPAS.

Issue materials to Material Issue Note as specified. Stage material for pickup. Notify the data entry operator of any discrepancies (i.e. Material Issue Note (HMG-CO-FM-065) issues 5, but only 4 are available or quantity variation of pipe actually issued) and assist as necessary in reconciliation of the variance.

5.13.4Requester – Receive Materials Pick up material and sign Material Issue Note and original FMR to acknowledge receipt.

5.13.5Material Control Filing If the FMR references a piping line/sheet number or an electrical drawing/sheet number, the original FMR will be filed in the same folder as the line/sheet or drawing/sheet Bill of Material.



If no line or drawing number is referenced, the FMR will be filed by sequence number.

5.13.6Returns Of Material The FMR is used to document return of material to the warehouse/laydown area when material is determined to be surplus or for other reasons. The individual who fills out the FMR return document (Annexure 6) will note the Drawing no., line no., item codes and sizes on the FMR return , otherwise, a full and detailed description of the material shall be written on the FMR.

5.13.7Material Requirements Planning Material requirements planning is performed by the materials group, under the direction of the Materials Control Coordinator. The Materials Control Coordinator is responsible for coordinating material required at site dates, material availability dates, report generation for site management, staff and contractor personnel and other related activities. The Material Control Coordinator interfaces with Project Controls, Home Office and Local Procurement, Construction and Warehouse/Laydown Yard personnel to develop and implement a material plan.

Bill of material requirements, purchase requisitions purchase order information and warehouse stock balances are combined with the construction schedule in order to determine what work can be performed and also identify material and equipment arriving after the required at site date. The steps to accomplish this are detailed below.

5.13.8ScheduleUtilising information from Project Controls, Construction and the Contractor, a work package schedule is developed which relates to defined work activities with material required at site dates to support the construction plan. Work packages are created in iPAS and the corresponding Required on site date is input. These required at site dates are reviewed regularly with Project Controls and Construction to ensure they reflect the current construction schedule.

5.13.9RequirementsBill of material drawing requirements is provided in the iPAS Material Management Module. The material planning module will be updated as material information is updated from the home office. Field initiated requirements through use of the Field Material Requisition form will also be updated into iPAS.

5.13.10 Inventory Inventory is comprised of actual warehouse/laydown yard stock on hand.

5.13.11 Equipment/Materials Due In Requisition and purchase order quantities and delivery status are updated in iPAS.

5.13.12 Allocation Of Material Once the above snapshots of data are completed in iPAS, the program will allocate the on hand and due in material to known bills of material in accordance with the Required on Site date.

Shortage reports, expediting reports, availability reports and other reports will be generated to provide the necessary information to assist construction and the installation contractors in scheduling work activities.



5.14 Out-Bound ShipmentsAll outbound shipments are controlled by the Material Management. Material Management is responsible for ensuring proper packaging, arranging for carrier service, loading and documentation, and conformity to special transportation, which will also include requirements for hazardous materials. The department requesting shipment will initiate the requirement by preparing a Material Shipping Record, (MSR) (See Annexure 4 – Material Shipping Record) and forwarding it to Purchasing.

Note: The MSR can also be used for intra-site transfer of custody.

6. Records All documents generated in terms of this procedure are to be retained as records in accordance with the requirements of the Archiving Project procedure, refer HMG-DM-P-013 – ‘Archiving and Retention of Project Documentation’.

HG:dvwAttachment(s)/Enclosure



Annexure 1 - Over, Short and Damage Report – HMG-CO-FM-014

NO:

OVER, SHORT OR DAMAGED DATE:

REPORT (OSD) PREPARED BY:

SHEET OF

PROJECT: LOCATION PROJECT NO:

DISCIPLINE: GRV NO: DATE ISSUED:

OUR ORDER NO: YOUR DEL. NOTE NO. CARRIER:

TO VENDOR: FOR ATTENTION OF:

Goods listed below were received: * Over-supplied * Under-supplied, * Damaged, * Not to specification, * Delete which is inapplicable.

QUANTITY DESCRIPTION REMARKS

AFTER CONSULTATION BETWEEN THE SUPPLIER AND SLE IT IS AGREED THAT:

APPROVED FOR SLE:

TITLE: …………………………….....................................

NAME: …………………………......................................

* GOODS BE RETURNED IN FULL SIGNATURE: …………………......................................

* PART OF GOODS BE RETURNED DATE: ………………………….....................................

* DAMAGED GOODS BE RECTIFIED ON SITE APPROVED FOR SUPPLIER:

* SUPPLIER TRANSPORTS AND OFFLOADS TITLE: …………………………....................................

* (DELETE WHICH IS NOT APPLICABLE) NAME: ……………………….....................................

SIGNATURE:……………………....................................

DATE: ………………………….....................................

DISTRIBUTION: ORIGINAL VENDOR SITE PROCUREMENT SUPERINTENDENT SITE ENGINEERING SUPERINTENDENT SITE BOOK COPY


Doc No.HMG-CO-P-009, Rev. 3, Page 17

Annexure 2 – Inwards Goods Receipt Reports –HMG-CO-FM-015

I-TEM-0473-ZA01-0

NO:

INWARDS GOODS RECEIPT REPORT DATE:

(MRR) PREPARED BY:

SHEET OF

PROJECT : PROJECT NO:

VENDOR: PURCHASE ORDER NO:

INSPECTION RELEASE CERT. NO: INSPECTION REQUIRED: YES NO

LINE NO.

DELIVERY NOTE NO.

DESCRIPTION OF GOODS

QUANTITY RECEIVED QUANTITY OUTSTANDING

DELIVERY

COMPLETE PART

STORAGE LOCATION:

OSD REPORT NO. (IF ANY):

REMARKS:

RECEIVED: NAME: ..............................................................

SIGNATURE: ....................................................

SLE SITE NAME: ...............................................................

MATERIALS CONTROLLER: ……………………………………..

SIGNATURE: .......................................................................

DISTRIBUTION: ORIGINAL - TO VENDOR CONTRACTOR

CONTRACTS ADMINISTRATOR SITE BOOK COPY

INSPECTION AND EXPEDITING MANAGER


-009, Rev. 3, Page 18

Annexure 3 - Over, Short and Damage Log – HMG-CO-FM-016

I-TEM-0473-ZA01-0 Doc No.HMG-CO-P

PROJECT:

OSD REGISTER PROJECT NO:

PREPARED BY:

DATE:

OSD NO. DATE PO NO MRR NO. DESCRIPTION REMARKS


-CO-P-009, Rev. 3, Page 19

Annexure 4 - Material Shipping Record – HMG-CO-FM-017

GRV NO:

MATERIAL SHIPPING RECORD PROJECT NO:

(MSR) PROJECT:

SHEET OF

PREPARED BY:

DATE:

THE FOLLOWING GOODS WERE TODAY RETURNED TO:

COMPANY: CONTRACT NO:

LOCATION:

QUANTITY

ITEM SIZE DESCRIPTION OF GOODS/TAG NUMBER RETURNED RECEIVED

REASON MATERIAL IS RETURNED:

NOTES:

RETURNED BY:

TITLE NAME SIGN DATE

THE ABOVE GOODS HAVE BEEN RECEIVED BY ME IN GOOD CONDITION:


I-TEM-0473-ZA01-0 Doc No.HMG



Annexure 5 - Field Material Request - HMG-CO-FM-018 REQ NO:

FIELD MATERIAL REQUEST PROJECT NO:

PROJECT:

FOR ATTENTION: SHEET OF

MATERIALS CONTROLLER PREPARED BY:

DATE REQUISITION RECEIVED: DATE:

THE FOLLOWING GOODS ARE REQUESTED FOR WITHDRAWEL:


LOCATION:

QUANTITY

ITEM SIZE DESCRIPTION OF GOODS/TAG NUMBER LOC. REQ.D REC. ETA

FOR CONTRACTOR MATERIALS CONTROL:


THE ABOVE GOODS HAVE BEEN RECEIVED BY ME IN GOOD CONDITION: (Transnet Projects)




Annexure 6 - Field Material Return - HMG-CO-FM-019 REQ NO:

FIELD MATERIAL RETURN PROJECT NO:

PROJECT:


MATERIALS CONTROLLER PREPARED BY:

DATE RECEIVED: DATE:

THE FOLLOWING GOODS ARE RETURNED:


LOCATION:

QUANTITY

ITEM SIZE DESCRIPTION OF GOODS/TAG NUMBER LOC. REQ.D REC. ETA

FOR CONTRACTOR MATERIALS CONTROL:


THE ABOVE GOODS HAVE BEEN RECEIVED BY ME IN GOOD CONDITION: (Transnet Projects)




Annexure 7 – Release Note - HMG-CO-FM-020 Package No. FRD Sequential No. Project Release No.

Contract No:

Arranged Shipping Date:

Arranged Delivery Date:

Transportation means:

Load Mass:

Load Size: Waybill No.

Lifting Facilities Required: Yes

Capacity of Lifting Required:

Who to arrange Lifting Facilities:

Construction Manager Advised: Yes

Equipment # Description Items

Releasedof

Total Items Ordered

_________________________________________________________________________________________

_________________________________________________________________________________________

_________________________________________________________________________________________

_________________________________________________________________________________________

_________________________________________________________________________________________

_________________________________________________________________________________________

Remarks: ________________________________________________________________________________

_________________________________________________________________________________________

_________________________________________________________________________________________

Expeditor: ______________________________________ Date: __________________________________

(Engineers, Quality Assurance Representative & Expeditor)

Distribution: Q A Manager Q A Representative Package Engineer Area Project Manager

Contract Administrator Contract Master File (Original) Construction Manager Contractor



Annexure 8 - Field Material Issue Note - HMG-CO-FM-065REQ NO:

FIELD MATERIAL ISSUE NOTE PROJECT NO:

PROJECT:


CONTRACTOR MATERIAL CONTROLLER PREPARED BY:

DATE FIELD MATERIAL REQUEST: DATE:

THE FOLLOWING GOODS ARE ISSUED FOR YOUR INSTALLATION:


LOCATION:

QUANTITY

ITEM SIZE DESCRIPTION OF GOODS/TAG NUMBER REQ.D ISSUED REC.

FOR MATERIALS CONTROL:


THE ABOVE GOODS HAVE BEEN RECEIVED BY ME IN GOOD CONDITION: CONTRACTOR MATERIALS CONTROL


Documents

On Site Material Management Procedure