PROJECT EXECUTION PLAN
1. OBJECTIVES
The objectives of this Plan are:
- To provide a standard template for Project Execution Plans (PEP);
- To identify the critical items which need to be included in all PEPs;
- To show how the PEP can be used as an organising structure for all project plans;
- To ensure that the key issues of value enhancement and risk management are properly addressed in the PEP.
The document is written as a guideline and therefore represents a recommended standard methodology which needs to be adapted to the specific PROJECT. Individual projects may deviate from, or modify, the content described here wherever such deviations can be justified.
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2. SCOPE OF THE PROJECT EXECUTION PLAN (PEP)
3. MAIN CHARACTERISTICS AND ACTIVITIES
3.1 Basic Principles
The basic principles to be applied when developing a PEP are:- Consistency and compliance with the others key project documents (e.g. the Field Development Plan)
- Multidisciplinary (compiled from stand-alone plans and procedures covering a broad range of project disciplines)
- Use –10% +15% accuracy on cost and schedule estimates (ideally based on at least 80% in value from tender responses).
- High level perspective
3.2 PEP Activities Overview
Normally, the PEP will cover all activities performed during the Execution Phase of the project under the management of the Project Team. This typically includes:
- Facilities design, fabrication and construction/installation
- Procurement and supply of materials
- Well drilling and completion
- Hook-up, pre-commissioning, commissioning and handover to Operations
- Operations and maintenance planning
- All supporting functional and technical activities/processes (e.g. value management, logistics, etc.)
- Activities which are not normally within the scope of the PEP include:
- Activities of the various committees (e.g. Operating committee, contractor’s committee, technical committee)
- Commercial negotiations and agreements
- Activities of the legal departments
- Senior management interactions with third parties, government agencies etc.
3.3 Management of the PEP Documentation
The PEP is usually approved and owned by the relevant Project Manager and he/she should approve all document revisions. On all projects there should be a formal document control mechanism in place and the PEP should be managed as a ‘controlled’ document. The PEP, together with its referenced standalone plans, should be made available to all project stakeholders.
3.4 Integration with other Documents
The PEP is the highest level project execution document, and is effectively an ‘umbrella’ for all the individual project plans, procedures, work instructions, or eventually sub-project PEPs.
It represents the ultimate source of guidance to the project team and should be the starting point when developing detailed project documentation. The PEP should specifically reference the relevant lower level documentation such as the individual project plans and Procedures.
The PEP is also an essential element of the Project HSE Management System and Project Quality System in that it specifies how these systems will be developed and applied to the project.
4. TYPICAL PEP TABLE OF CONTENTS
- Objectives and Scope of The PEP
- Project Objectives and Goals
- Project Objectives and Critical Success Factors
- Scope Summary
- Project Execution Strategy
- Summary Cost and Schedule
- Organisation
- Ownership and Contractual Obligations
- Project Organisation
- Company and Project Internal Interfaces
- Management Systems, Strategies, Plans and Procedures
- Management Systems
- HSE
- Security
- Quality
- Interfaces
- Permits and Consents
- Value Assurance
- Risk Management
- Information Management
- Project Change Management
- Planning and Controlling
- Procurement
- Supply Chain
- Design
- Drilling
- Construction
- Commissioning and Start-Up
- Operations and Maintenance
- Decommissioning
- Insurance
A brief description of each section is included in the following pages.
4.1 Objectives and Scope of the PEP
In this introductory section, clearly define:
- The objectives of the PEP:
- Why we need the document, and the value it adds
- Its position within the project document hierarchy:
- How it relates to other systems such as Project HSE & Quality Management Systems, etc.
- Which documents take precedence in case of conflict
- Document ownership o Who approves the PEP
- Who maintains it
- Its scope of application o Project elements - facilities onshore/offshore, drilling, associated projects (e.g. social) etc.
- Organizations covered, including suppliers and contractors
- Start and end point within the project lifecycle (e.g. Front-End Engineering through to handover)
4.2 Project Objectives and Goals
4.2.1 Project Objectives and Critical Success Factors
- COMPANY or JOINT VENTURE corporate objectives (overall)
- Project objectives and drivers
- Critical success factors
4.2.2 Project Summary
- Location
- Overview of reservoir (STOIIP, Geological description, etc.)
- Development Strategy: Overview of well patterns. Overview description of facilities’, Phasing of development activities
- Project scope boundaries (battery limits)
4.2.3 Project Execution Strategy
- Brief explanation of execution strategy only, demonstrating how and why the proposed execution strategy and plan will best meet the objectives of the project.
- Major risks to project success, plus control mechanisms (i.e. how the execution strategy controls/mitigates these risks).
- Major outstanding decisions (and timing for these to be made).
- Resources summary (number of work locations, numbers of personnel at each location, available assets and infrastructures, etc.).
4.2.4 Overview of Cost and Schedule
- Key targets and milestones
- Level of uncertainty/confidence around these (normally +/- 10% for a Project Sanction).
4.3 Organisation
4.3.1 Ownership and Contractual Obligations
- Ownership structure
- Contractual obligations (PSA and JOA)
- Role of the National Authorities
- Governance Structure: Committees and Sub-Committees, together with their roles and responsibilities
4.3.2 Project Organisation
- COMPANY (or Joint Venture) organisation
- Project organisation
- Organisation Strategy
- Organisation chart / lines of communication
- Financial delegation of authority for the project teams
- Recruitment/Manning strategy (if applicable)
- Accountabilities, responsibilities and required competencies of key individuals
- Roles of contractors and suppliers when an integral part of the project organisation
- Relationship with the Work Breakdown Structure
4.3.3 Company and Project Internal Interfaces
Brief definition, categorization and description of COMPANY and project internal interfaces, highlighting those that are particularly critical for the success of the Execution phase – i.e., interface with the Operations team.
4.4.Management Systems, Strategies, Plans & Procedures
4.1.1. Management Systems
Reference should be made to COMPANY’s Management System, and all applicable systems Partners’ management systems, etc. which give the overall management hierarchies and approaches to the PEP, as the PEP is a key controlling document in the PROJECT management system.
The PEP should reference among others, the following Management Systems:
- HSE Management System
- Quality Management System
- Procurement Management System
- Operations Management System
- Information Management System
4.1.2. Health Safety & Environment
- The expectation of what is intended to be achieved
- The responsibility of the HSE Committee
- The performance requirements of the Operating and Project Groups
- The above should also include references to HSE Standards and Guidelines.
4.1.2.1. Project HSE Management System
For smaller projects, a project-specific HSE Management System could not be required. The Project HSE Management System will include the Project HAZID and Risk Registers.
4.1.2.2. Health Safety & Environment Plan
The purpose of the Project HSE Plan is to:
- Provide a statement of the Project HSE objectives and performance and how they will be achieved over life of the Project
- Describe Project-specific HSE objectives and targets
- Describe the specific HSE management activities to achieve planned objectives, including responsibilities and competency assurance
- Describe the contingency and emergency response planning
- Describe special HSE initiatives and programmes
- Describe how Contractors’ HSE management performance will be evaluated prior to selection and during the execution of the work
The Project HSE Plan requires for a Document Management Procedure between the Contractors and COMPANY to be developed and maintained. This should clearly define the interface between the various HSE Management Systems, identifying key roles and responsibilities for each activity defined and its associated tasks, standards and procedures etc.
Contractors will be required to prepare appropriate HSE plans that ensure that the requirements set out in the contract and the overall Project HSE Plan are met. Where this is not possible, suitable interface documentation shall be developed and referred to.
4.1.2.3. HSE Auditing and Review
This section should contain the integrated Project HSE Audit and Review Schedule, comprising:
- COMPANY HSE Audit and Review Schedule
- Contractors’ HSE Audit and Review Schedules
4.1.2.4. Third Party Verification for Safety Critical Elements
If applicable, this section shall include:
- Definition of safety critical elements and their Performance Standards
- Development of Written Scheme of Examination
- Methods for demonstrating that performance standards for safety critical elements have been met through Independent Competent Person Verification
4.1.3. Security
- Special security risks or requirements description
- Measures undertaken for security of COMPANY and contractor personnel
- Measures undertaken for security of materials and equipment
- Plan for emergency preparedness
- Allocation of responsibility for assurance for security of site, personnel, materials and equipment between COMPANY, contractors, subcontractors and suppliers
4.1.4. Quality
4.1.4.1. Company Quality Assurance Procedures
The COMPANY Quality Management Systems and Procedures shall be referenced. These normally draw upon the requirements of the ISO 9001:2000 standards, and support the development process.
4.1.4.2. Project QA/QC Plan
The Project Quality Plan should be referenced, which will apply to all activities undertaken by the Project Team and will comply with COMPANY Quality Systems and Procedures. It will form the top-level Project document that will be used to cascade the requirements for quality management throughout the Project (i.e. it will set the frame in which Contractors’ quality management systems will operate).
Where appropriate, reference should be made to the appropriate terms within the contracts relative to quality.
The Project Quality Plan will restate the Corporate quality policy and objectives in the specific context of Project requirements.
The Project Quality Plan will:
- Identify the processes and the application of the processes needed to realize the project goals in accordance with the quality policy and objectives
- Indicate the sequence and interaction of the processes
- Define how these processes are operated and controlled.
- Identify the resources required to implement the processes.
- Identify the primary accountabilities and responsibilities.
- Monitor, measure and analyse the processes.
- Define the processes of continuous improvement will be implemented, including monitoring, measurement, analysis and improvement processes and receipt of customer feedback.
- Demonstrate management buy-in and commitment.
The Project Quality Plan shall define how the above points will be applied in all the areas of the project.
4.1.5. Interfaces
4.1.5.1. Stakeholders Management Plan
- List of identified stakeholders and their primary requirements
- Schedule, budget and quality implications of stakeholders’ primary requirements
- Stakeholder analysis results containing
- interests, objectives and drivers
- disposition towards Project and influence/power on Project outcomes
- level of potential obstacles posed
- possible strategies and actions
- risk assessment (likelihood and impact on Project of potential actions)
- Proposed stakeholder management strategy
- Action plan (key activities, timing and resource requirements)
- Monitoring mechanisms for gathering and managing stakeholder’s feedback in order to identify potential weaknesses or improvement points and incorporate change in the strategic pattern
4.1.5.2. Interface Management Plan
- Functions of the COMPANY involved in the interface
- Competencies involved
- Objectives of the specific interface activities
- Scope of the work required
- Deliverables
- Timing
- Roles and Responsibilities
4.1.6. Permits and Consents
4.1.7. Value
4.1.7.1. Value Management Strategy
- Value Assurance Process: the process for demonstrating that project value objectives have been met through activities such as Value Assurance Reviews, Peer Reviews and Peer Assists and value tracking methodologies
- Value Improvement Practices: techniques and methods used to increase project value for example by reducing costs and/or improving project attributes such as schedule.
- Decision Making Tools: the use of tools and techniques to improve decision quality
- Learning Capture and Application: the formal capture of lessons learned and dissemination to relevant areas of the project (see also section 4.8 Information)
- Risk Management Process: the process for the identification, evaluation and management of project risks
For the above areas the Project Value Management Strategy should address:
- The key project value drivers
- Specific areas to be a focus for value improvement
- Targets for value improvement
- Methodology for achieving the targets
- How value gains are to be measured, tracked and reported
- Education of the project team in value management techniques and processes
- Critical success factors and how these are to be addressed
- The value assurance process to be adopted
4.1.7.2. Value Improvement Plan
The Value Improvement Plan should contain a schedule of those activities such Value Improving Practices, Value Assurance Reviews, Peer Assists, Peer Reviews, key decisions requiring application of formal decision making processes and tools, lessons learned workshops, risk management activities and initiatives. It should identify the resources required to carry out the activities and the responsibilities of all the parties involved.
4.1.8. Risk Management
4.1.8.1. Risk Register
- Identified risks
- Define procedure for Risk categorization, impact area, level, manageability and priority
4.1.8.2. Risk Management Plan
- Risk identification and reporting
- Qualitative analysis
- Quantitative (probabilistic) analysis
- Response planning, including timing, roles and responsibilities
4.1.9. Information Management
4.1.9.1. Information Communication Technology (ICT) Plan
The Information Communication Technology (ICT) plan provides a framework for the IT systems required to support the overall Project life-cycle. The plan should identify:
- The life-cycle stages that the technology platform is supporting
- Business Process that support the life-cycle stages
- External Interface Requirements
- Service Level Requirements of the Production Environment
The ICT Plan should state the life-cycle stages that are supported by the technology platform(s) in terms of:
- Cost and Schedule Management
- Management Information Reporting
- Materials Management (logistics tracking and expediting of bulks and materials)
- Construction Management (warehouse management, construction planning, allocation of resources)
- Plant Management
- Commissioning Management (completion management, plant and equipment data management)
- Health and Safety System Management (tracking of HSE policies)
- Permits, Consents and Approvals Management (database of permitting status, contracts approved, customs cleared, accepted by warehouse etc.)
- Value and Quality Management
- Technology components that are common to all life-cycle stages include:
- Electronic Document Management
- Internet Portal Management
- Management Information Reporting
- Geographic Information Systems (GIS)
Within each lifecycle stage, the supporting work flows and business process should be developed to confirm the requirements of the discipline owners.
- The identification of interfaces with the technology platform may include:
- Enterprise Resource Planning (ERP) Systems
- Electronic Document Management Systems (EDMS)
- Operations
On the latter point, the interface with Operations is key and should include:
- A strategy for project execution and operation migration
- Identification of Project Technology components that will transfer into Operations (i.e. EDMS)
- Definition of all deliverables and information structure required for migration to operations
The service level requirements of the technology platform include:
- General Service Level requirements of key technology platforms across geography
- Operational running of email and web server components
- Bandwidth and availability requirements of secure and public internet connections
- Development of an infrastructure plan including office and satellite communication links
- Identification of Data Centre requirements
- Business Continuity Plan (BCP)
- Backup and Archive Strategy
4.1.9.2. Administration of Project Communication
- Partners interface and communications
- Interfaces and communications with the Authorities
- Minutes of meeting
- E-mail management
- Project correspondence
- Correspondence numbering
- Language Policy
4.1.9.3. Documentation Management
- Document numbering procedure
- Project document formatting procedure
- As-built documentation
- Document management and retrieval system (electronic or hard copy)
- Document archiving philosophy
4.1.9.4. Monitoring and Reporting
Define the objectives of the reporting system and the project monitoring criteria, for example:
- To demonstrate to senior management that the project is progressing in line with agreed objectives (and if not, that suitable actions are being undertaken)
- To communicate to project team and other involved Company functions the key data and facts on project status
- To provide a summary of project progress to partners and government.
- To identify areas requiring attention and/or corrective actions by the project manager and project team Where necessary, to enable approval of changes in budget or schedule.
- Activities and parameters to be monitored
- Methods of reporting progress
- Content, timing and distribution of progress reports
- Responsibilities (for providing/gathering information, approving and issuing reports) Special requirements for information management and the means by which these are handled:
- Compatibility with every Partner’s communications systems
- Communications with the Authorities and the public community
4.1.9.5. Knowledge Management System
A description of how the Project intends to identify, capture and transfer lessons learned originating within and outside the COMPANY.
4.1.10. Project Change Management
Categories of change and degree of effect on project objectives (e.g. cost and schedule objectives, etc.)
- Project Change (e.g. emanating from PSA/JOA terms and conditions)
- Design basis change
- Design change
- Scope change
- Regulatory change
Dependent upon category of change, process and authority level for managing change
- Description of the appointed Project Change Control Board
- Definition of the levels of project baseline for modification approval
- Reference to variation proposals/orders, company instructions, work orders and procedures
4.1.11. Planning and Controlling
4.1.11.1. Management of Costs
- COMPANY and contractor methods, systems and procedures for cost management
- Development of Cost Estimates, including explanation of levels of accuracy
- Cost estimate report
- Development of Control Budget
- Cost Budget
- Authorisation for Expenditure (AFE) / Cash Call management
- Requirements for cost collecting and reporting relative to frequency, content and distribution
- Allocation of responsibilities for cost estimating, reporting and control between COMPANY and Contractors.
- Cost reporting
- Earned value analysis
- Commitments and forecasting
- Cash calls
- Trend control
- Cash flow management
- Feedback of cost data (continuous improvement)
- Management of special cost-related problems and uncertainties
4.1.11.2. Schedule Management
- COMPANY systems and procedures for controlling progress and schedule
- Allocation of schedule management responsibilities between COMPANY Project Team and contractors.
- Progress measurement & reporting
- Earned value calculations
- Schedule updating
- Schedule integration - preparing and maintaining the "Project Master Schedule"
- Resource scheduling and control
- Schedule coordination with Operations
- Schedule coordination with Drilling
- Influence of individual schedules for onshore/offshore/pipelines on overall schedule
- Management of special schedule-related problems and uncertainties
- Project Master Schedule
- Integrated Plan
- Project risking, and probabilistic milestone dates
4.1.11.3. Accounting
- Organisation and responsibilities
- Accounting system and procedures
4.1.12. Procurement
4.1.12.1. Contracting Strategy
- Describe and explain the proposed contracting strategy:
- How has the overall work program been packaged, and why does this maximize value?
- Which commercial risks will be carried by, or shared with, the contractors, and which will be carried entirely by the project owners?
- Why is the most appropriate risk-sharing approach?
- What controls are in place to manage these risks? (reference the Risk Register and/or Risk Management Plan)
- Outline the tendering and award strategy for major contracts.
- What are the key constraints and how are we addressing them?
- How can we minimise cycle time whilst meeting all our obligations and maintaining our business principles?
- Reference the Contracting Strategy document, Contracts & Procurement Plan and/or other detailed procedures.
4.1.12.2. Procurement Plan
- Scope of work of each contract, status of pre-qualification activities and proposed award date
- Contract type to be adopted for each contract
- Reimbursement method for each contract
- Special terms and conditions
- Special procedures or considerations for pre-qualification of contractors.
- Outstanding decisions and how/when the decisions will be made
- Reference to contract administration procedures
4.1.12.3. Purchasing Strategy and Plan
- COMPANY policies and host government requirements.
- Identification of what will be provided in-house and what will be purchased by others.
- Schedule.
- Reference to Project specific procedures.
4.1.13. Supply Chain
4.1.13.1. Materials Management
- Description of the Materials Management Strategy, which should describe:
- Impact of Contracting Strategy
- External factors
- Coding rules
- Information Technology aspects
- Impact on Project Organisation
- Materials Management Plan, which should describe how the Project will manage the following phases of the Material Management Process:
- Specification of required materials
- Support to purchasing of materials and equipment
- Materials identification unique numbering system
- Inspection, testing, expediting of the produced materials
- Transportation of materials to their destination
- Handling, installation and storage of materials on site
- Provision of materials for operations and maintenance
4.1.13.2. Logistics Strategy
The logistics management strategy should describe
- The Integrated Management Information System to be used for the consolidation, forwarding, transporting, routing and tracking of freight from source to destination
- Existing infrastructure (office and warehouse facilities, transportation mode and route, including the main river and sea ports, berthing, width and draft limitations, airports, owners of the above)
- The need for upgraded/additional infrastructure
- Materials logistics: dimensions, weight, and criticality of material to be transported, frequency of movement per project phase, including special provisions for out of gauge equipment and materials, methodology of movement, both from outside the project area, and locally within the project area
- Personnel logistics: movement into and within the project area, frequency and numbers of personnel per project phase, modes of transport under normal and emergency evacuation situations
- The project organisation relative to logistics, including the role of a Project Management Services Contractor (if applicable) and key internal and external interfaces
- Schedule of Customs, Permits and Consents
- Logistics constraints: climatic conditions, legislation etc.
- The role of local companies in the provision of logistics services
4.1.14. Design
- Allocation of design management responsibilities between COMPANY, Project Management Contractor (if applicable), engineering contractors, and all the suppliers:
- Role of the PMSC (if applicable)
- Design/technical approval requirements and authorities
- Timing and plans for COMPANY design reviews - HAZOP and related design reviews
- Value Engineering and Constructability Reviews
- Integration of HSE management with design management
- Third party verification of design
- Means by which special design-related challenges or difficulties will be handled
- New technology
- Use of proprietary COMPANY technology
- Use of proprietary contractor technology
- Performance of design contractors that the COMPANY may be using for the first time
- Precedents set by existing facilities or JV partners.
- Design standards
- COMPANY minimum standards
- Local standards and practices
- Generally Accepted industry standards and practices
- Contractor standards and practices
- Policy on use of CAD or other automated design or management techniques
- Integration of Operations input into design
4.1.15. Construction
- Allocation of responsibilities between COMPANY, Construction Management Constructor (if applicable), and construction contractors
- Role of the CMC (if applicable)
- Subcontracting strategy
- Union relations
- Construction supervision
- Coordination of construction activities between onshore and offshore project areas
- Controlling progress and performance
- Coordination of COMPANY, contractor, vendors and module fabrication subcontractors, delivery and erection
- Integration of construction schedule with design and procurement
- Safety management and Quality management
- Preventive maintenance during construction
- Management of special construction issues
- New design or construction technology
- Temporary facilities
- Hostile environment
- Local construction regulations
- Performance of contractors that COMPANY may be using for the first time
- Site access
- Soil conditions
- HSE issues
- Emergency access / evacuation systems
- Local labour issues
- Assurance of adequacy of supply of construction labour, equipment and materials
- Local sources
- Union vs. non-union
- Training requirements
- Storage capacity, spill prevention plan
4.1.16. Commissioning and Start-Up
- Scope of work split between Construction (i.e. mechanical completion and pre- commissioning) and Commissioning and Start-up.
- Allocation of responsibilities between COMPANY and contractors during commissioning and start-up operations (including hand-over to Operations)
- Integration of timing, activities and requirements into the overall project plan to achieve “start-up driven scheduling”
- Co-ordination of planning between team, construction team and Operations
- Special start-up requirements to be reflected in project design or plans
- Unusual need for operator training
- New process or controls technology
- Hazardous materials
- Difficult or complex interface with Operations
- Effluent monitoring and mitigation related to start-up
- HSE issues associated with facility start up sequence
- Start-up sequencing to meet handover to Operations
- Interfaces for Handover to Operations
- Loop checks
- Safety walk-through
- Punch list close-out for residual construction items
- Requirements for operator-based training
- Operator training
- Maintenance training
- Start-up training
- Emergency response training
- Safety training
- Strategy for development of Local operator workforce
4.1.17. Operations and Maintenance
- Description of the General Operations philosophy relative to degree of automation, staffing levels, staff rotation, training, local content, contracting strategy, etc.
- Operations input into engineering design
- Transition planning for handover from Project to Operations
- Asset integrity plan
- Simultaneous Operations (SIMOPs) plans (if applicable)
4.1.18. Decommissioning
- Obligations (e.g. from PSA) and COMPANY policy
- Decommissioning Strategy and outline plan
4.1.19. Insurance
Description of how the project is going to transfer risk on third parties along the upcoming project phases.
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