PETRONAS GAS BHD EXPERIENCES IN ACCREDITATION OF ISO 9002 QUALITY ASSURANCE STANDARD FOR ITS PIPELINE OPERATIONS DIVISION IN MALAYSIA

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1 International Pipeline Conference Volume 1 ASME 1996 IPC PETRONAS GAS BHD EXPERIENCES IN ACCREDITATION OF ISO 9002 QUALITY ASSURANCE STANDARD FOR ITS PIPELINE OPERATIONS DIVISION IN MALAYSIA Muhamed Ali Hashim Mohamed HSE QM Department Transmission Operations Division Petronas Gas Bhd Johor, Malaysia Tel: Fax: alimh@ petronas.com.my ABSTRACT S om e com panies s e e k IS O registration for com petitive reasons or b ecause custom ers require it. P E T R O N A S G a s Bhd, pipeline division com pany T O D or Transm ission O perations Division, seek IS O registrations purely for the benefits since the m an ag em en t believes that a well designed and well im plem ented quality system has a process which tends to be lean, sensitive to custom ers needs, highly reactive and efficient. This p ap er informs how T O D sets out to put IS O international quality system to w ork in its operations. A Q uality S teering Council w as form ed in Feb and th e H S E and Q uality M a n a g e m e n t M an ag er w as appointed as m an ag e m e n t representative. T he current working system w as first assessed. Next, an im plem entation plan w as prepared. Training w as provided and the quality m anual prepared followed by all the necessary work procedures and instructions. Finally there w as trial im plem entation and actual "live" im plem entation. In January T O D IS O registration was approved. P E T R O N A S A N D P G B -T O D P E T R O N A S is an international M alaysian Oil and G as C om pany with head office in K uala Lumpur, M alaysia. P E T R O N A S G as Bhd (P G B ) is a subsidiary com pany of P E T R O N A S organised to handle the processing and transm ission of natural gas to its customers. Transm ission O perations Division (T O D ) is the pipeline division in P G B that handles the operations, transmission and delivery of natural gas to P E T R O N A S customers. T O D started operation in late 1991 and current gas sales is about million standard cubic feet per day (m m scfd). C apacity is expected to reach mmscfd by year after T O D pipeline has expanded. T O D currently o perates the gas transm ission system in Peninsular M alaysia only. It has about 1000 kilometers of high pressure pipeline. Current T O D total personnel num ber is In 1990, all key personnel w ere trained in C anada, Alberta with N O V A C O R P International. In line with P E T R O N A S aspiration for quality, in 1994, T O D decided to seek IS O accreditation from Standards and Industrial R esearch Institute of M alaysia (S IR IM ), the g overm ent-sanctioned national accreditation body for IS O TOD had also adopted the following quality policy: " P G B -T O D quality policy is to ensure safe, reliable and efficient supply of Dry G as to all P E T R O N A S customers. W e are totally com m itted towards improving our business operations culture and all aspect of its activities so as to ensure P E T R O N A S custom ers satisfaction. T o realise this, P G B -T O D has adopted the IS O :1994 quality assurance standards operations." as a w ay of our business Copyright 1996 by ASME

2 B A C K G R O U N D O F P G B -T O D T O D operates the G as Transmission System in Peninsular M alaysia. This division provides transportation services for dry gas (commercially called natural gas or sales gas) and is responsible for the custody of dry gas from the point of custody transfer at the outlet of Gas Processing P lan t(g P P ) in Kerteh to delivery points at various locations along the gas pipeline route where custody of dry gas is transferred to specified customers. Dry gas is also exported to Singapore via high pressure sub-sea pipeline crossing the Johor Straits. (P lease refer to figure 1) a. All m anagers will be a m em ber of the Quality Steering Council (Q S C ) chaired by the G eneral M anager of TO D. T he M anagem ent Representative becomes the Secretary. b. The Health, Safety and Environment (H SE) Superintendent was elected the Managem ent Representative on quality and he will be responsible to ensure that the requirements of the ISO 9002 quality assurance standards are im plemented and maintained. This position was upgraded to H S E and Quality M anagem ent M anager. Dry gas produced by G P P is tested and m easured at the G P P M eter Station before entering the gas pipelines. The dry gas is then compressed at compressor stations to a pressure level that satisfy the hydraulic profile required to m eet contractual delivery pressures at various delivery m eter stations. A Supervisory Control and D ata Acquisition (S C A D A ) system facilitates the monitoring and controlling of the Gas Transmission System. T he system is monitored through the G as Control Centre located in Segam at Operations Centre w here information regarding operating conditions, supply, transmission and delivery of dry gas are monitored 24 hours a day, 365 days a year. The gas transmission facilities are designed and installed according to standards that ensures safe, reliable and efficient operations resulting in a high level of customers confidence. Operations and maintenance procedures and work instructions will ensure system integrity and ongoing reliability of the G as Transmission System. O ne operation centre and six regional offices, located strategically along the pipeline route, provide the bases from which T O D personnel conduct various activities related to the administration, operations and m aintenance of the Gas Transmission System. Q U A L IT Y S T E E R IN G C O U N C IL The Quality Steering Council was form ed in February T he following w ere the guidelines set by T O D Quality Steering Council in this IS O 9002 project. c. All T O D regional offices and departments will be simultaneously registered under one ISO 9002 certification. d. All procedures and work instructions will be developed and finalise in-house using current personnel expertise, resources and experience. e. A consultant will be engaged on "as and when required basis" to provide the necessary training and directions. The consultancy cost will be not more than RM 160,000 (U S 62,000) or RM 23,000 (U S 8,800) for each location. f. T O D will receive IS O 9002 accreditation from SIR IM, end of D ecem ber 1994 or early January 1995 giving about ten (10) months implementation time. At first, Q S C m em bers deliberated on options available for ISO 9002 registration. The first option was to have a single certification that covers the whole T O D activities and its operation centre and regional offices. The other option was to select a particular regional office to be the pioneer in IS O 9002 registration with others to follow suit. How ever after thorough discussion, the Q S C decided it would in fact be more beneficial to seek registration simultaneously for all offices and facilities since all regional offices will use the sam e quality procedures and work instructions. Furthermore, with all staff participating, many more working team s could be formed to provide feedback on the quality system implementation.

3 TRAINING Training is an integral part of IS O 9002 implementation. All m anagers and staff must be fam iliar and well trained with IS O 9002 requirem ents. Key personnel w ere given more detail and extensive training on IS O 9002 so that they could train and lead other personnel. The areas of training covered were: a. Introduction to IS O 9000 b. Introduction, Docum entation and Implementation of IS O 9000 c. Internal Quality Audit d. Lead Assessor Course e. Statistical Technique The total cost incurred for all the above training am ounted to R M 6 3,0 0 0 (U S 24,000). Since managers are the "guardian angels" of the quality system they were required to attend the Lead Assessor Course that covers IS O 9000 Quality Standards very extensively. H SE and Quality M anagem ent Departm ent also conducted ISO 9002 road show at all regional offices and conducted aw areness training, in-house, to all levels of personnel. During the road show all concerns, problems and feedback from personnel w ere noted and later incorporated at the im plementation stage. D O C U M E N T A T IO N The quality manual was the first document that had to be prepared before all departm ents could start to prepare the necessary procedures and work instructions. The quality manual addressed all the 18 elem ents of the ISO 9002 quality assurance standard and sets out organizational overview, system outline and the procedure references in the quality system. The Q SC m em bers spent a total of about six working days to review and finalise the quality manual. After the day, all m anagers had thoroughly understood the quality manual and what the quality manual expected from each department. Upon completion of the quality manual, each departm ent prepared the quality procedures and quality work instructions that is in line with the quality manual. Existing procedures w ere reviewed and updated to suit IS O 9002 requirem ent while som e new procedures were required to be written. The H SE and Quality M anagem ent Departm ent were responsible to coordinate the overall document preparation as well as to prepare HSE and quality m anagem ent procedures. Technical Services Departm ent were required to review and/or develop all technical procedures that have to be implemented at the various regional offices with input from regional offices personnel. All other departm ents w ere also required to do the sam e on the departm ental procedures. All quality procedures and work instructions were prepared in-house with participation from all levels of operation personnel. Operation Technicians were helpful during preparation of quality work instructions i.e. documenting how to do a certain task. The concern was to document everything so that it could be implemented in a practicable m anner (i.e. "to write what you do and do what you write"). Having this concern in mind, all procedures w ere written and m ade simple, easy to follow, unambiguous and covered all aspects of the quality system. Reference documentation, i.e. documentation that need to be referred to follow a procedure or work instructions, was also compiled and controlled. All operations related drawings w ere reviewed and controlled as well. The engaged ISO 9002 consultant was then called in to review all documentation. All comments by the consultant were taken up and documents w ere immediately revised by the respective authors. In June 1994, all departments had completed their documentation. "LIVE" IM P L E M E N T A T IO N From July to August 1994, "live" implementation of the quality m anagem ent system was carried out on a trial stage. During the trial implementation stage weaknesses in the quality m anagem ent system were detected by performing internal quality audit at all regional offices and departments. Feedback from users of procedures and work instructions was also received and used as a basis to revise and continually improved the documentation. In Septem ber 1994, actual carried out. "live" implementation was Impact to new work culture during the actual "live" implementation was at a minimal since this was already cushioned during the trial "live" stage. In October, internal quality audit was again conducted at all

4 departm ents to find any leftover w eaknesses in the quality system. At this stage, all personnel were already aw are of the docum ented quality system. Non-conform ances detected during the internal quality audit w ere im m ediately corrected. Most of the corrective actions required certain quality procedures and work instructions to be revised. S IR IM A D E Q U A C Y A N D C O M P L IA N C E A U D IT In October 3, 1994, tw o(2) S IR IM senior quality auditors carried out a one day adequacy audit to ensure that the docum ented quality system for T O D adequately addressed the requirements of IS O 9002:1994 Quality Assurance Standard. S IR IM auditors selectively audit through all T O D 38 quality procedures, 138 quality work instructions and quality manual. At the end of the adequacy audit S IR IM concluded that the quality system had addressed all requirements. T O D had obtained a "zero defect" adequacy audit and as such S IR IM recom m ended January 5-12, 1995, as the date for compliance audit. S IR IM also commented that the quality manual, procedures and work instructions were well written, easy to follow and precise. The perfect result of the S IR IM adequacy audit had m ade all personnel even more committed to ensure the success of IS O 9002 registration. Everyone felt proud about the adequacy audit result and is determ ined to get "zero defect" as well during S IR IM compliance audit. The presence of high morale m ade it easier to further sharpened the implementation requirements such as record com pleteness and keeping, document controlled and personnel understanding on quality procedures and work instructions. In N ovem ber and D ecem ber 1994, in-house internal pre-s IR IM compliance audit was conducted at all departm ents. The engaged IS O 9002 consultant was called in to help with the audit. After this audit confidence to pass S IR IM compliance audit was very high. From January 5-12, 1995 S IR IM sent tw o(2) senior quality auditors to conduct compliance audit on T O D. The compliance audit started at Shah Alam regional office, followed by Serem ban regional office and Pasir Gudang regional office. Next, S IR IM auditors audited Segam at operation center and finally Kuantan regional office including its compressor stations and facilities. After conducting a thorough compliance audit involving all activities from receiving, transmission and delivery of dry gas including the operation and m aintenance of gas transmission system, S IR IM auditors concluded TO D could be recom m ended for registration. The SIRIM auditors had conducted a total of fourteen(14) audit man days and observed only six(6) minor non-conformances throughout the audit. All six(6) minor non-conformances were corrected immediately and closed out during SIR IM audit closing meeting on January 12, 1995, itself although twenty one (21) days w ere officially given to close the minor non-conformances. S IR IM auditors commented that T O D quality m anagem ent system was well in placed and all personnel w ere very committed towards quality. IS O 9002:1994 registration for T O D was officially approved by the S IR IM Quality Standards Council in February This project was completed according to schedule and within budget. M A IN P R O B L E M S E N C O U N T E R E D The main problems encountered during the implementation of IS O 9002 project were the geographical fact that all personnel and facilities were distributed all over the country. Problems on document control were the most evident. Every time a document was distributed for implementation there were 87 people as recipient in the distribution list (m axim um ). In comparison, a centrally located plant would only have about 20 people in their distribution list. Therefore, m assive coordination is required to control all quality documents and drawings since IS O 9002 require documents to be controlled. This was achieved through developing a good document control procedure with the Document Controller centrally located in Segam at operation center. To ensure smooth running of the quality management system, the ISO 9002 program on awareness, internal quality audit, training, implementation and corrective actions follow-up, had to be continuously conducted and reviewed at all regional Offices. There are seven(7) main offices to be looked into namely, Shah Alam regional office, Serem ban regional office, Pasir Gudang regional office, Segam at operation center, Kuantan regional office,

5 Kuantan com pressor office and Kertih compressor office. Each office had their im plementation problems and w eaknesses. Problem s found at one location were im m ediately shared with other locations for corrective actions to be sim ultaneously taken. T he managers and heads of each location w ere responsible to ensure that the quality m anagem ent system in their area were running well. They would communicate with the m anagem ent representative if any assistance or clarification w ere required. T he effort put into this ISO 9002 project was like going through seven(7) ISO 9002 accreditation at a time. Another problem encountered w as to convince S IR IM that T O D w anted only one IS O 9002 registration as a whole and not seven(7) separate registration for each office. S IR IM agreed to provide for one registration after being informed that regional offices actually practised common quality procedures, which w ere developed at the head office in Segam at. Furtherm ore, regional offices only act as the operation and m aintenance arm of Segam at operation center. S IR IM however, had to charge T O D extra fee for registration due to the distributed location of the regional offices. There w ere problems too in getting personnel priority on the IS O 9002 project. Throughout year 1994, T O D had also em barked on other projects as well. Among them w ere right sizing the organisation, m anpow er planning program, conduct Intelligent Pigging, implementing a new m aintenance and purchase system and preparation for PG B public listing in Effective use of resource and time had to be planned to ensure that all personnel could focus on the successful im plementation of ISO 9002 project without jeopardizing other ongoing projects. give priority on IS O 9002 project. The drive and momentum to m eet S IR IM registration target date was easier to sustain during this short period. A longer implementation period m ay result in personnel commitment and eagerness to mellow down. c) T he "live" implementation of the quality m anagem ent system on a trial stage had improved the quality system at a faster pace. T he trial stage allowed revision on documents to be done unofficially, thus quickly. Also, personnel were not too worried about doing things right the first time during trial stage and as such could concentrate on testing the use of the written procedures. d) The training and aw areness program on IS O 9002 were conducted at all levels of personnel. As most training was done in-house, the dissemination of new work culture based on IS O 9002 concept, was effectively gained and internalised. e) All quality procedures w ere developed in-house. Furthermore, procedures from other organisations in and outside P E T R O N A S w ere also used as a benchmark. This had contributed to creation of some well-founded quality procedures. e) Last but not least, the most important success factor that contributed to the smooth implementation of the project was the good cooperation and team work obtained from all levels of personnel. Personnel were willing to work extra hours every day showing full commitment to the project. The P E T R O N A S shared values of loyalty, professionalism, integrity and cohesiveness truly existed in TO D. S U C C E S S F A C T O R S Am ong the factors that had directly or indirectly contributed to the success of this project were: a) T O D m anagem ent from the beginning had always provided positive directions or stewardship and all personnel w ere kept aw are of the m anagem ent commitment. b) The short im plem entation period of about ten(10) months had in fact successfully driven all personnel to B E N E F IT S G A IN E D All personnel agreed that IS O 9002 quality m anagem ent system had provided an overall improvement to the working system compared previously before the quality system was in placed. Som e examples of the benefits gained are as follows: a) M anagem ent decision making is now more competent and dependable because the Q S C reviews all the important quality elem ents like customer s complaint, internal quality audit results, process problems, gas supply etc. Every process is link under the ISO 9002

6 quality system such that m anagem ent now has a helicopter view of whats going on, where the problems are, and how to correct and prevent them. In sum, the benefits obtainable are seen at all levels of the company. ISO 9000 is certainly a powerful m anagem ent tool. b) There is now clear responsibility on all jobs because the procedures described who does what, where, why, when and how. At the stage when the procedures and quality manual w ere first written, it was realised that some work processes require new procedures to be developed. An exam ple is the customer complaint procedure. Previously custom er complaints were handled differently by different departm ent. The overall analysis on the trend or nature of customer complaints was not done. However, all complaints are now monitored by G as Control departm ent and customers can rest assured that complaints will be officially acknowledged in one or two days. All complaints are also discussed at Q S C and treated as an oppurtunity for improvement. c) The docum ent control requirem ent in ISO 9002 quality system ensures that every personnel have only the latest documents to work with. Records that have exceeded their stated retention period are now destroyed so there are no more bulky files containing records that no one cares about. Everyone could now do work according to the latest approved procedures and if the procedures w ere found to be lacking, it could be improved in the system. Thus, the quality system had help create an efficient office administration environment. FUTURE PLANS It is envisaged that ISO 9002 must becom e the way of life or the culture of T O D to assure continuous improvements and attainment of Total Quality M anagem ent or T Q M. The quest for excellence will not slow down. In the near future, the following plans are already in place. a. To upgrade the current quality m anagem ent system to comply with ISO 14000: Environmental Managem ent System. b. To continue with further quality training in areas like Statistical Process Control and Statistical Organizational Control, T Q M Planning and Surveys, Quality Im provem ent and Continuous Process Improvement, Benchmarking and Quality Leadership and Team work. c. To continuously improve any w eaknesses found in current quality procedures or work instructions. d. Identify new areas within T O D that can be included in the IS O 9002 quality m anagem ent system. d) The quality system requires that all important equipment is calibrated, checked and tagged. All operations and m aintenance work must be performed according to approved schedule and records of the work properly kept so that it could be audited later. The assurances built in the quality system had help create an efficient field operations and m aintenance environment. e) O ne benefit of being registered to S IR IM as an accredited IS O 9002 company is that the company undergoes objective surveillance audits twice a year by S IR IM 's professional quality auditors. This external audit had obligates m anagem ent futher to ensure the quality system is running smoothly and is in accordance to the quality standard. Also, due to ISO 9002 registration, customers had potrayed added contidence to T O D. CONCLUSION In February 1994, w e knew almost nothing about ISO However, because we started this project with a very strong commitment, w e had beaten all the odds by obtaining ISO 9002 accreditation in January W e also benefited tremendously from this new way of life or working culture. W e have shown that the implementation of ISO 9002 at T O D can be carried out at a relatively low cost and short time provided everyone works as a team to achieve a common goal. Looking towards the future, we see TO D as a division that has all the ingredient to achieve excellence in its business operations. This is evident with its proven track record in operations, m aintenance, safety and now the ISO 9002 accreditation.

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