PDO xxxxxxxxx PRE-START-UP AUDIT

1. PDO xxxxxxxxx PRE-START-UP AUDIT

2. Agenda • the audit team • audit objectives • schedule • recommendations • reporting

3. Team members • xxxxx PDO (Leader)

4. HSE Performance “There must always be a gap between … aspirations and performance … But a gap between policy and performance is unacceptable” Phil Watts - Shell EP HSE Conference 22 September 1997

5. Terms of Reference Objective To assess the readiness of all resources, controls, procedures and services to support the operation of the new facility.

7. Standards • Applicable Oman laws and regulations • Group HSE policies and commitments • PDO and contractor policies, standards and procedures • Group and SIEP HSE guidelines such as EP95 000

8. Terms of reference • Audit programme • EP95-0130 StudyDocumentation Site visit Interviews Test findings ReportFinalisation PresentFindings Drafting Editing Agree findings Audit Process Familiarisation Review & Testing Reporting

9. Terms of Reference Scope • The scope is limited to those facilities, resources and controls necessary to operate the xxxxxxxxxx Expansion Facilities. Exclusions: • Corporate HSE issues not directly related to the Facilities.

10. Specific issues 1 • Demonstration that HSE risks are ALARP • Design, installation, commissioning • Future operation • HSE Case • Close out of audits and reviews • HAZOP close out • Fitness for purpose hardware • Constructed to design • Effectiveness of change control

11. Specific issues 2 • Commissioning • Plans & Procedures • Personnel • Concurrent operations risks • Procedures • Operating, Maintenance • Availability and adequacy • Emergency • Understood and exercised

12. Specific issues 3 • Operations plans for start-up • Organisation • Responsibilities • Contractor / PDO • Interfaces • Communications • Resources & services • Personnel • Spares, consumables • Environmental compliance

13. Audit Programme Sat 31/5 Opening Presentations Doc. Review Sun 1/6 Coastal Interviews Mon 2/6 Visit Site - Compile notes Tue 3/6 Return from Site Wed 4/6 Compile Report Sat 7/6 Draft Report/Final Presentation Wed 11/6 Issue Final Report

14. Audit opinions The IAC defines 4 possible audit opinions: • Good • Fair • Poor (equivalent to IAG Unsatisfactory) • Unacceptable The definitions are in terms of: • the level of concern • the inference for senior management

15. Audit opinion derivation • Based principally upon an assessment of severity and number of Findings • Definition of Few and Many: Few  20 Many  40 each Finding to contain only one weakness

16. AUDIT OPINION Few  20 Findings Many  40 Findings

18. Audit Recommendations • For a Pre Start-Up audit, an indication is given, in the classification of Findings of: • those that should be closed out prior to the introduction of hydro-carbons - classified (I) • those that should be closed out prior to close out of this project - classified (C) • those that are not directly related to project close out - classified (F)

19. Serious: Exposes OU to a major extent in terms of achievement of corporate HSE objectives or results. High: Though not serious, essential to be brought to Management attention. Includes medium weaknesses as repeat from previous reports. Low: No major HSE impact at process level, correction will assure greater effectiveness/efficiency in process concerned. Weakness Classification Matrix A B C D E Environ- ment Repu- tation Happens several times a year in the audited OU Happens several times a year in the audited facility Severity People Assets Never heard of in EP industry Has occurred in EP industry Has occurred in the audited OU No injury No damage No effect No impact 0 123 Low Slight impact Slight injury Slight damage Slight effect 1 Minor injury Minor damage Minor effect Minor impact 2 Medium Consider- able impact Major injury Local damage Localised effect 3 High Single fatality Major damage Major effect National impact 4 Serious Inter- national impact Extensive damage Massive effect Multiple fatalities 5 Medium: Could result in perceptible and undesirable effect on achievement of HSE objectives.

20. Report Principles • Report is collective view of team • no reference to sources • whole team review whole report • facts reported are as agreed by all the team • judgements are by consensus as far as practicable • wording agreed to as to intended meaning • audit leader has casting vote in case of disagreement • where possible, root causes identified • Final draft report before team disbands • no later changes, only minor (punctuation, grammar) editing in CO • final report within two weeks

21. THE END

22. Structure of Questionnaires • Generic Questionnaire (common to all HSE Audits) • Leadership & Commitment • Policy & Strategic Objectives • Organisation, Responsibilities, Resources, Contractor Management. Communications, HSE-MS Documentation, Standards & Change Control • Hazards and Effects Management • Planning & Procedures • Implementation & Monitoring • Audit • Management Review Subsidiary Questionnaire Facilities Subsidiary Questionnaire Seismic Subsidiary Questionnaire Facilities Subsidiary Questionnaire Drilling Subsidiary Questionnaire Start-Up Subsidiary Questionnaire Environment Subsidiary Questionnaire Health

23. EP-HSE Audit Method • Focus on Risk • OU Staff involved • Based on OU / Contractor standards • Bottom up Approach • Significance & breadth of findings • Assessment of the 33 HSE MS sub elements of the HSE MS Self Assessment Questionnaire (levels 1-4) • Follow up: OU responsibility • Audit of HSE MS, fully covering H, S and • Sampling Process • Questionnaire based

24. HSE Audit Overview • Auditors will: • operate in pairs (sometimes three) • make an appointment to see you • no surprise visits • try to make it as easy as possible • be only interested in facts, not speculation (interested in your view in how to improve) • possibly use a questionnaire in the interview • ask open ended questions • like “How ..”, “In what way…” • interview a “vertical slice” of the organization • look for the good as well as the less than adequate