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Inspection facility by contractor but paid for by operating company?

asked Dec 17, 2014 in Construction by sabdullayev (5,290 points)
I'm with an engineering contractor studying FEED for a FPSO and the requirement is for us to maintain quality control (QC) inspection at the warehouse facilities in the country of the oil field such that all goods, equipment and materials and associated documentation for the FPSO are QC inspected prior to storage in the warehouse or shipment offshore.

The problem with that is where quality conformance certificates are provided by the equipment vendor, we (engineering contractor) will rely on such certificate or any other 3rd party certificates. If we are required to have permanent inspection facility in country, then should we ask for the cost of such facility to be paid for by the operating company?

1 Answer

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answered Dec 17, 2014 by wangroc (3,280 points)

In the event that expediting or vendor attendance is required to support the procurement process then Contractor needs to carry out such attendance then make request for approval of such cost and be reimbursed in accordance with the Contract that was signed between Operating Company and your Engineering Firm.

With that being said, the Industry usually practice the followings:

  • Contractor during the O&M phase should carry out all spare parts identification and procurement activities in accordance with the Contract and Good Industry Practice including:
    • Place order with Operating Company approved vendors
    • Expedite orders as necessary
    • Carry out customs clearance and other regulatory requirements
    • Carry out in-bound inspection at Contractor’s warehouse
    • Confirm all required documentation received including all inspection, test and certification documentation as appropriate
    • Thereafter either store in Contractor’s warehouse or re-pack for onward transportation to FPSO Site
  • Contractor should develop spares list for capital, commissioning and operational spares as part of the spare parts strategy and submit for Company review and approval. The following should be included in the spare part strategy:
    • Commissioning and start up, capital and operating spares
    • Sparing method, required stock levels and locations
    • Preservation and storage requirements 
    • Lead time to spare is ready for installation
    • Procurement strategy including expeditious procurement of parts and material
    • Material specification and quality assurance (QA) strategy to ensure that acquired spares comply with applicable quality and certification requirements
  • Contractor should procure, manage, receive, marshal, inspect, stock and preserve all operational; and other spare parts required for 2 years of operation

Hope that answers your questions.