Project Management Manual

PROJECT MANAGEMENT MANUAL

The Project Management Manual For Transmission Projects

Asset Development Department Transmission Division Tenaga Nasional Berhad (Edition 1 – 2010)


Asset Development Department, Transmission Division Page i

A. INTRODUCTION .......................................................................................... 1

1. OBJECTIVE OF PROJECT MANAGEMENT MANUAL ....................... 1 2. SCOPE OF PROJECT MANAGEMENT ................................................. 1 3. PROJECT ORGANISATION STRUCTURE ........................................... 2 4. RESPONSIBILITIES OF KEY PERSONNEL ......................................... 3 4.1 PROJECT MANAGER .......................................................................... 3 4.2 PROJECT ENGINEER .......................................................................... 4

B. PROCEDURE/PROCESS ............................................................................ 4

1. PRE AWARD STAGE ............................................................................. 4 1.1 NOTICE TO PROCEED (NTP) ............................................................. 5 1.2 APPOINTMENT OF PROJECT MANAGER AND PREPARATION OF

PROJECT OUTLINE ............................................................................. 5 1.3 PROJECT BUDGETING ....................................................................... 6 1.4 BILL OF QUANTITIES (BQ) PREPARATION ...................................... 6 1.5 PREPARATION OF PROJECT EXECUTION PLAN (PEP) ................. 7 1.6 APPROVAL OF PEP AND ISSUANCE OF NOTICE TO TENDER

(NTT) ..................................................................................................... 8 1.7 TENDER AND EVALUATION PROCESS ............................................ 8 2. POST AWARD/CONSTRUCTION STAGE ............................................ 9 2.1. PROJECT PREREQUISITES ............................................................... 9 2.1.1 Letter of Acceptance ........................................................................ 9 2.1.2 Project Kick Off Meeting (KOM) ...................................................... 9 2.1.3 Notice of Commencement Date ...................................................... 9 2.1.4 Site Handing Over ......................................................................... 10 2.1.5 Contract Document ........................................................................ 10 2.1.6 Performance Security .................................................................... 10 2.1.7 Project Insurance ........................................................................... 11 2.1.8 Tax exemption ............................................................................... 11 2.1.9 Project schedule ............................................................................ 12 2.1.10 Safety and Health Measures ......................................................... 12 2.1.11 Cost Disbursement ........................................................................ 12 2.1.12 Budget and Purchase Requisition/Purchase Order ...................... 13 2.2 ENGINEERING REVIEW .................................................................... 13 2.2.1 Drawing Review & Approval .......................................................... 13 2.2.2 Equipment Manufacturing .............................................................. 14


Asset Development Department, Transmission Division Page ii

2.2.3 Type Test Requirement ................................................................. 14 2.2.4 Factory Acceptance Test Requirements ....................................... 14 2.2.5 Final Bill of Quantities .................................................................... 15 2.3 CONSTRUCTION STAGE .................................................................. 15 2.3.1 Approval from local authority ......................................................... 15 2.3.2 Site Mobilisation ............................................................................. 15 2.3.3 Civil Works ..................................................................................... 16 2.3.4 Equipment Delivery........................................................................ 17 2.3.5 Equipment Installation ................................................................... 18 2.3.6 Appointment of Tester. .................................................................. 19 2.3.7 Specification Compliance Audit (SCA) .......................................... 19 2.3.8 Site Acceptance Test/Testing Works ............................................ 20 2.3.9 Pre-Commissioning Inspection and Testing (PIAT) ..................... 20 2.3.10 Reliability and Safety Verification (RSV) ....................................... 21 2.3.11 Commissioning .............................................................................. 24 2.3.12 Project Taking Over ....................................................................... 24 3. POST COMMISSIONING ..................................................................... 25 3.1 Project Financial Closing..................................................................... 25 3.2 Defect Management & Project Closing ............................................... 25

C. PROJECT CONTROL ................................................................................ 26

1. PROJECT PROGRESS ........................................................................ 26 2. PROGRESS REPORTING ................................................................... 27 3. EXTENSION OF TIME (EOT) ............................................................... 28 4. PROJECT INSURANCE ....................................................................... 28 5. PERFORMANCE SECURITY ............................................................... 29 6. DELAY DAMAGES ............................................................................... 29 7. PROGRESS PAYMENT ....................................................................... 30 8. CONTRACT COST AND BUDGET ...................................................... 30 9. QUALITY ASSURANCE ....................................................................... 31

D. GLOSSARY ................................................................................................ 32


Asset Development Department, Transmission Division Page 1

A. INTRODUCTION

1. OBJECTIVE OF PROJECT MANAGEMENT MANUAL

The objective of this Project Management Manual is to provide a comprehensive guideline to Project Managers and Project Engineers in managing and ensuring that the implementation of transmission projects shall be in accordance with the following specific targets :-

Within the specified completion date. Within allocated budget and contract cost. In accordance with stipulated quality standards. In compliance with health, safety and environmental (HSE)

requirements. This Project Management Manual describes the detailed processes and procedures of project management based on established guidelines of ISO processes and procedures. This Project Management Manual shall be further supported by specific quality, inspection and testing procedures which provide further activity details. For clarity purposes, this Project Management Manual shall be read together with all other related Transmission Division’s procedures, manuals and instructions.

2. SCOPE OF PROJECT MANAGEMENT

The scope of project management shall include various phases of project life cycle from Notice to Proceed (NTP) to completion and closing of projects. The process of project management covers the following main project activities, namely:-



Planning Organising Coordinating Supervising Monitoring Controlling Closing

3. PROJECT ORGANISATION STRUCTURE

For effective implementation of projects, the project organisation structure shall be firstly established. The project organisation structure may include a functional structure, or a matrix structure, or the combination of both. It shall include members from various units and departments within Transmission Division as well as personnel from various disciplines from other divisions, including but not limited to:-

Project managers Project engineers Supervisors Finance officers Engineering department Procurement & Contract officers EWRM

A typical project organisation structure may be described as follows:-



4. RESPONSIBILITIES OF KEY PERSONNEL

4.1 PROJECT MANAGER

Heads the project team, provides direction, guidance and resolves issues.

Liaises with Government agencies, other relevant authorities and contractors.

Coordinates the works of the project components. Reviews and approves the contractors’ proposed construction

work programme for the purpose of project scheduling, management and monitoring.

Prepares monthly progress report to the Management. Administers the contract throughout the project

implementation phase. Manages claims and interim payments. Monitors and controls costing – financial projection. Reviews and verifies contractors’ extension of time claims. Monitors and verifies that equipment and works shall conform

to required specifications and quality standard. Resolves any contractual or project implementation issues. Prepares all relevant certificates relating to project contract(s).

Project Director

Engineering

Procurement & Contract

Project Manager

Finance

EWRM

Project Engineer

Project Supervisor



Manages the rectification of defects during defects liability period.

4.2 PROJECT ENGINEER

Assists the Project Manager to manage the construction

phase of project(s). Liaises with other relevant TNB divisions/departments and

contact persons responsible for approval of installation, testing and commissioning of project(s).

Ensures compliance to quality and safety requirements of project(s).

Checks and recommends for approval contractors’ detailed work schedule for the construction plan.

Organises and chairs monthly site meetings with contractor(s). Monitors contractors’ construction progress in adhering to the

required contractual milestones. Verifies construction progress claims by contractor(s). Monitors current and projected construction progress with

necessary corrective actions (if needed).

B. PROCEDURE/PROCESS

The project management cycle is divided into three (3) stages as follows:-

Pre-award Stage Construction Stage Post Commissioning Stage

i) PRE AWARD STAGE

The pre-award stage commences from the issuance of Notice to Proceed (NTP) until the award of a particular project.



1.1 NOTICE TO PROCEED (NTP)

Asset Manager to issue NTP to Senior General Manager (Asset Development) (“SGM(AD)”) to commence the pre-award activities.

1.2 APPOINTMENT OF PROJECT MANAGER AND PREPARATION

OF PROJECT OUTLINE

i. SGM (AD) to issue the appointment letter (together with the NTP documentation) to the relevant Regional Manager to be appointed as a Project Manager for a particular project and for the purpose of Project Outline (POL) preparation.

ii. Project Manager to coordinate a NTP kick-off meeting with other relevant divisions/departments, including Transmission Asset Maintenance Department (“AMD”), Wayleave and Land Management Department, Planning Division (“PD”) and Distribution Division (“DD”). AMD/PD to brief on the project and its requirements. Any feedback and updates on the issues relating to the project shall be accordingly coordinated by the Project Manager for the next course of action.

iii. Project Manager shall be responsible to prepare a POL within three (3) weeks from receipt of his appointment letter from SGM (AD). The POL shall consist of :-

Scope of work Project details - Proposed schematic & layout Existing schematic & layout Project schedule Project completion date Issues & concerns (Project Risks) Project Execution Team

iv. Each POL shall be attached with its own "Document

Identification Transmittal".



v. The POL shall be forwarded to the respective General

Manager (Asset Development) via the Project Coordination Unit (“UKP”) for review and approval.

vi. The POL shall then be forwarded by UKP to General

Manager (Engineering) with a copy to the respective Project Manager for scoping of works, project design and preparation of Bill of Quantities (“BQ”).

1.3 PROJECT BUDGETING

i. Project Manager is responsible to request for a budget for

new projects and to be forwarded to UKP for budget approval from TNB higher Management.

ii. The budget is to be requested during budget preparation

stage in March every year (as per usual yearly practice).

iii. Project Manager is responsible to monitor the utilisation of the budget during the implementation of the project.

1.4 BILL OF QUANTITIES (BQ) PREPARATION

i. Engineering Department shall be responsible to prepare a BQ within two (2) months from receipt of POL from UKP.

ii. During BQ preparation, UKP shall coordinate a Semi-Final Design Meeting with Project Manager, Engineering Department, Asset Maintenance Department, System Operation Department, PD, ICT Division, DD, Procurement & Contract Unit and AMD.



iii. The said Design Meeting shall identify any other alternative option(s) or change of scope of works (if so needed) for the project which shall be accordingly minuted, such as unsuitable substation site, unpractical project proposal due to site or system constraints, and so on. The cost and justification of such alternative option(s) or change of scope of works shall be detailed out with necessary follow up recommendations and to be agreed upon by both AMD and PD.

iv. The Minutes of Meeting which is to be prepared by the Project Manager shall be copied to AMD and PD.

v. Engineering Department shall then finalise the technical specifications and revised BQ after the Final Design Meeting and to be forwarded to UKP for further follow up action.

1.5 PREPARATION OF PROJECT EXECUTION PLAN (PEP)

i. UKP shall forward the BQ to the Project Manager for the

preparation of Project Execution Plan (“PEP”).

ii. The Project Manager shall be responsible to prepare PEP within one (1) week from receipt of BQ from UKP.

iii. The Project Manager shall prepare a PEP which consists the followings :-

Scope of work Project details - Proposed schematic & layout Existing schematic & layout Project schedule Project completion date Outage constraints & staging works requirements Issues & concerns (Project Risks) Recommendations (if any) Project implementation team



iv. The PEP shall be forwarded to the respective General

Manager (Asset Development) via UKP for his review and approval.

v. The PEP shall be attached with its own "Document Identification Transmittal".

1.6 APPROVAL OF PEP AND ISSUANCE OF NOTICE TO TENDER (NTT)

i. The PEP shall be reviewed and approved by the respective

General Manager (Asset Development).

ii. Upon approval of the PEP, SGM(AD) shall issue a Notice to Tender (“NTT”) to Procurement & Contract Unit to proceed with the tendering process.

1.7 TENDER AND EVALUATION PROCESS

i. Upon receipt of the NTT, the Procurement & Contract Unit shall proceed with the tendering process for the project.

ii. Procurement & Contract Unit shall also be responsible for the evaluation (technical & financial) and the conduct of pre-award meeting(s).

iii. The time frame for the procurement process from receipt of

NTT to award of contract shall be within the range of five (5) to eight (8) months.



2. POST AWARD/CONSTRUCTION STAGE

2.1. PROJECT PREREQUISITES

2.1.1 Letter of Acceptance

Letter of Acceptance (“LA”) shall be issued by the Procurement Division to successful contractor with a copy to the appointed Project Manager.

2.1.2 Project Kick Off Meeting (KOM)

i. Upon receiving the LA, the Project Manager shall conduct a

kick off meeting (“KOM”) with the successful contractor and all other relevant parties.

ii. The Project Manager shall prepare the agenda for the KOM

covering every aspect of the project.

iii. The Procurement & Contract Unit shall ensure that interim contract documents are made available during the KOM.

iv. The Project Manager shall issue a notice of project

commencement date to the successful contractor. The required time for project completion shall also be confirmed by the Project Manager with the contractor.

v. The Project Manager shall be required to prepare and

circulate the Minutes of Meeting within two (2) weeks after the conduct of the KOM.

2.1.3 Notice of Commencement Date

i. The Project Manager shall issue a not less than seven (7)

days’ notice of the project commencement date to the successful contractor.



2.1.4 Site Handing Over

i. The Project Manager shall ensure that the project site is

handed over to the contractor as per the specified date in the Appendix to Tender.

2.1.5 Contract Document

i. The Project Manager shall liaise with the Procurement

Division in ensuring that the contract document is finalised and signed within 56 days after the contractor receives the LA unless otherwise specified.

ii. The Project Manager shall keep one execution copy of the

contract document for reference and safe keeping.

2.1.6 Performance Security

i. The Project Manager shall be responsible in ensuring that the required Performance Security is submitted by the contractor within 28 days from the date of LA.

ii. The value of the Performance Security shall be five (5) per

centum of the total contract amount.

iii. The Performance Security shall be valid for the entire contract period plus the defects liability period with an additional six (6) months period thereafter.

iv. The Performance Security shall be issued by a locally

domiciled bank.

v. The contractor must submit the Performance Security to the Procurement Division where the Project Manager shall also



be required to keep a copy of the same in the project file for reference and safe keeping.

2.1.7 Project Insurance

For projects with contract value of less than RM100million,

i. The contractor shall be the insuring party and be responsible

for arrangement of insurance.

ii. The Project Manager shall ensure that the project insurance is in place and is legally in order before commencing any physical activities at site.

iii. The project insurance shall be valid for the entire contract

period until the issuance of Taking Over Certificate.

iv. The contractor shall be required to submit the project insurance policies with proof of payment receipts of insurance premiums being paid.

For projects with contract value of more than RM100million,

i. The employer (TNB) shall be the insuring party who shall

arrange for the insurance.

ii. The Project Manager shall initiate the floating of tender for the procurement of project insurance.

2.1.8 Tax exemption

i. Project Manager shall ensure that the application for tax exemption for both local and foreign materials to be purchased is carried out as per Group Tax Unit, TNB (GTU) requirements.



ii. Application for tax exemption must be submitted at least three (3) months before equipment delivery date.

iii. A time extension for tax exemption application may be

permitted where there is a delay in equipment delivery, where the validity of such an extension is one (1) year from the approval date.

2.1.9 Project schedule

i. Project Manager shall ensure that the project schedule is submitted by the contractor within stipulated time under the contract, and to stamp 'APPROVED' on the project schedule as the official approval prior to the execution of physical site works.

ii. The project schedule shall be prepared by adopting the

critical path method, such as Microsoft Project.

2.1.10 Safety and Health Measures

i. Project Manager shall conduct Safety Kick Off Meeting within three (3) months of the Project Kick Off Meeting.

ii. Project Manager shall ensure the formation of a Safety

Committee for his project.

iii. The implementation of all safety and health measures at site shall be in accordance with relevant safety procedures.

2.1.11 Cost Disbursement

i. Project Manager shall ensure that the contractor submit the

cost disbursement for the current year related to the approved work programme.



ii. Project Manager shall then review the cost disbursement as submitted by the contractor and to subsequently create the necessary Purchase Order.

iii. Project Manager shall create and release the Purchase

Requisition for the projected payments for the first three months of the project schedule.

iv. Project Manager shall request for the Purchase Order from

the Procurement & Contract Unit.

2.1.12 Budget and Purchase Requisition/Purchase Order

i. Project Manager shall create and release the Purchase

Requisition (PR) for Purchase Order (PO) request for the Financial Year.

ii. Project Manager shall manage and monitor the Capital

Expenditure and cost disbursement for the project.

2.2 ENGINEERING REVIEW

2.2.1 Drawing Review & Approval

i. Project Manager shall monitor and ensure that all the drawings are submitted by the contractor to Engineering Department for approval prior to the construction works as per agreed work programmes.

ii. Project Manager shall keep one copy of the approved

drawings for reference and safe keeping.



2.2.2 Equipment Manufacturing

i. Project Manager shall ensure that the contractor shall commence the manufacturing of all the equipment after drawings have been approved by Engineering Department.

ii. Project Manager shall monitor and ensure that the

manufacturing schedules are in accordance with the approved project schedule.

2.2.3 Type Test Requirement

i. Engineering Department shall review and inform the

contractor on the requirements of equipment type test.

ii. Engineering Department shall schedule the date of the type test with the contractor.

iii. Project Manager shall monitor the type test schedule and

keep one copy of the type test report upon successful completion of the type test.

2.2.4 Factory Acceptance Test Requirements

i. Engineering Department shall review and inform the contractor on the requirements of equipment factory acceptance test (“FAT”).

ii. Engineering Department shall schedule and arrange the FAT

with the contractor.

iii. Project Manager shall ensure that the FAT is successfully carried out prior to site delivery.



iv. Project Manager or his representative shall attend and monitor the FAT schedule and keep one copy of the FAT report for reference and safe keeping.

2.2.5 Final Bill of Quantities

i. Project Manager shall finalise the BQ with the contractor

based on approved drawings and equipment by Engineering Department within six (6) months from the contractual commencement date.

ii. Project Manager shall highlight all errors in Employer’s

Requirements, if any, within 56 days from the contractual commencement date.

iii. For lump-sum contract, the Project Manager shall finalise the

payment schedule based on milestones / equivalent BQ.

iv. Project Manager shall raise and submit Variation Orders for approval should cost variations arise due to TNB's fault (e.g. inaccurate BQ, change in scope or works, etc.).

2.3 CONSTRUCTION STAGE

2.3.1 Approval from local authority

i. Project Manager shall ensure that the contractor shall obtain

the necessary approval from relevant local authority(ies) before commencing civil work.

2.3.2 Site Mobilisation

i. Project Manager shall ensure that site preliminaries as per

the contract, e.g. site office facilities, security, electricity and water supply, etc., are provided by the contractor.



2.3.3 Civil Works

i. Project Manager shall supervise the construction works as against the approved drawings by using the ISO checklists.

ii. Project Manager shall ensure that the project

engineer/supervisor to be present at project site at all times during construction works by the contractor for supervisory purposes.

iii. Project Manager shall ensure that the contractor’s safety

officer to be present at project site during construction works and that the contractor has taken all safety measures and precautions in accordance with statutory requirements of Occupational Safety and Health Act (“OSHA”).

iv. Project Manager shall ensure that all workers of the

contractor at the project site shall be in possession of valid Construction Industry Development Board Malaysia (CIDB) green card and NIOSH TNB Safety Passport (NTSP).

v. Project Manager shall ensure that all approved copies of civil

drawings are made available at the site office.

vi. Project Manager shall ensure that the project engineer/supervisor shall keep up-to-date records of completed works for payment verification purposes.

vii. Project Manager shall ensure that all activities at site are

carried out in accordance with the project schedule.



2.3.4 Equipment Delivery

i. Project Manager shall ensure that the contractor submit to him the proposed delivery schedule of all materials and equipment required for the implementation of the project.

ii. Project Manager shall approve the delivery of equipment to

site whenever appropriate and to ensure that the equipment are handled and stored properly with adequate security.

iii. Project Manager shall approve the delivery of equipment in

accordance with the project schedule.

iv. Project Manager and the contractor shall ensure that the equipment transporters observe proper handling and transportation procedures before and during delivery of equipment.

v. Delivery of materials and equipment shall be made either to

site or to a designated store.

vi. Project Manager shall ensure that the equipment are delivered with all relevant documents attached (e.g. delivery order, packing list, etc).

vii. Project Manager shall ensure that the delivered equipment

are in accordance with specified quantities with no damage after inspection.

viii. Project Manager shall ensure that all materials and

equipment delivered shall be acknowledged by both the contractor and the Project Manager's representative.



2.3.5 Equipment Installation

i. Project Manager shall ensure that all associated civil works to be completed before the commencement of erection and installation works.

ii. The contractor shall make available complete sets of

approved drawings and provisional Operation & Maintenance manuals at the site office.

iii. The contractor shall submit an erection and installation work

programme to the Project Manager.

iv. Project Manager shall ensure that the installation /erection works checklists are to be used for project monitoring purposes.

v. All non-conformance reports which have been issued during

installation shall be recorded in the Master Defect List for further remedial actions.

vi. Further inspection shall be carried out after all non-

conformances have been rectified and updated.

vii. Project Manager shall ensure that the contractor’s safety officer to be present at site during construction works and that the contractor has taken all safety measures and precautions in accordance with OSHA requirements.

viii. Project Manager shall ensure that all workers of the

contractor at the project site shall be in possession of valid CIDB green card and NTSP.



2.3.6 Appointment of Tester.

i. Project Manager shall propose the start date of testing works for the Secretary of Testers’ Selection Committee to appoint the tester for the project.

ii. Project Manager shall ensure that the tester is appointed

prior to the commencement of the testing works.

2.3.7 Specification Compliance Audit (SCA)

i. Specification Compliance Audit (SCA) shall be carried out to check for compliance of Physical Installation to the Documentation.

ii. Project Manager/Project Engineer shall be in possession of

the SCA Declaration from the contractor prior to the SCA exercise.

iii. SCA shall be conducted in three stages, namely, Opening

Meeting, Documentation Check and Physical Check (Site Inspection).

iv. Project Manager shall take the following actions in

accordance with the SCA results:- Passed:

Proceed to SAT

Conditional Passed; Passed with minor defect/outstanding works: Rectify the defects/outstanding works Get endorsement from Project Manager for clearance

(SCA Clearance Form to be submitted to Project Manager). Refer to Appendix 4.

After clearance, proceed to SAT.



Failed:

Rectify the defects. Perform second SCA.

v. Project Manager shall issue the SCA reports to the

contractor.

2.3.8 Site Acceptance Test/Testing Works

i. Project Manager shall facilitate and arrange for the outages required for the testing works.

ii. Project Manager shall coordinate all testing activities

between the contractor, tester and other related departments.

iii. Project Manager shall monitor and coordinate the Site

Acceptance Test (“SAT”) to be carried out by the tester in four stages :-

Stage 1 – Multi-core termination checks and AC/DC system commissioning.

Stage 2 – Component level testing for primary and secondary equipments.

Stage 3 – CT/VT circuit check, switchgear operation test and control scheme test.

Stage 4 – Protection scheme test, stability test and trip test.

iv. After successful completion of SAT, Project Manager shall arrange for PIAT to be carried out.

2.3.9 Pre-Commissioning Inspection and Testing (PIAT)

i. Project Manager shall be in possession of the PIAT

Declaration from the contractor prior to the PIAT exercise.



ii. Project Manager shall call for pre-commissioning meeting

once the facility to be commissioned being fully installed and ready for PIAT and RSV.

iii. The agenda of the meeting shall include the followings:- Outage request Proposed switching / commissioning schedule Proposed PIAT / RSV and commissioning dates

iv. Action to be taken after PIAT:

Passed

Clear PIAT defects (if applicable).

Failed Rectify the defect. Perform second PIAT.

v. Project Manager shall ensure that all defects detected during

PIAT are to be rectified by the contractor.

vi. Project Manager shall ensure that the approved commissioning memorandum is made available before RSV.

2.3.10 Reliability and Safety Verification (RSV)

i. The RSV shall be carried out by AMD of Transmission Division to ensure the integrity of all new installations/plants prior to commissioning/energising.

ii. The RSV inspection shall be carried out only after completing and passing of PIAT during Stage 2 and upon completion of all tests in Stage 3 and Stage 4 of SAT.

iii. Project Manager shall submit the declaration on scope and

readiness of installation to be verified before the date for



RSV is scheduled. Project Manager is required to request for the RSV dates for the following month by the 22nd day of the current month.

iv. For works that involve system outages with limited time frame and requiring the issuance of Permit To Work, the function of RSV shall be delegated to the respective Asset Maintenance office to ensure safe and reliable energisation.

v. The RSV process for new installations/plants involves two (2) following phases :-

Phase 1 – Civil RSV a) Civil RSV shall be carried out after completion of

earthwork and at commencement of piling work. Project Manager shall submit declaration to Transmission AMD.

b) Documentation, records and physical work shall be checked during civil RSV. Some of the major check points are:-

Approved drawings Method statements ISO W.I. checklist Report - S.I, testing, etc. Approved certificate – materials, etc. Records- installation records, etc. Quality Of Workmanship. Source of water supply Availability/quality of access road

Phase 2 – Final RSV

Stage 1 – Documentation Check

Inspection on Test Results for completeness and adherence to SAT requirements.



a) Documentation

Clearance form Master Defect List Approved construction and engineering drawings

b) Physical check on primary equipments

Visual inspection Operation Health check Safety and working clearance Civil works, structures, fittings and installations Finished product used as per requirement

c) Settings

All final endorsed primary and secondary settings/configuration/calculations shall be made available and compiled properly at site.

Settings for every relay shall be downloaded and checked against the endorsed settings.

d) Test Results

Endorsed SAT test results must be made available. Analysis on the test results shall be carried out. Discrepancy on the test results as compared to the

accepted values shall be captured and justified.

e) Protection and Control Scheme Inspection on protection and control scheme as per

approved drawings and PCOP. Conjunctive test as per SAT requirement

f) Civil Inspection

Closure of NCRs M&E audit and test results Quality of workmanship & finishing BOMBA inspection Certificate of Fitness (CF)



Stage 2 – Site verification Physical checks and selective re-tests shall be carried out.

vi. RSV would only PASS if:-

Physical checks on primary & secondary equipment are in compliance to safety and reliability requirement.

All tests requirements as per SAT have been duly completed.

All test results have been analysed and endorsed by ESE. Selective re-tests successfully carried out. No safety related matters/issues on installation and

personnel. No issues pertaining to potential tripping/failure are

detected.

2.3.11 Commissioning

i. The contractor/tester/AM/Project Manager endorses the Clearance Certificate in confirming that the facility is fully tested and is ready for commissioning.

ii. If the commissioning of the facility is:-

Unsuccessful, Project Manager shall instruct the contractor to rectify

the problem. Prior to the contractor working on the rectification, the

Project Manager shall cancel the Clearance Certificate.

Successful, proceed to 2.3.12. 2.3.12 Project Taking Over

i. Project Manager to ensure that the Master Defect List (MDL) is prepared and signed by Asset Maintenance department (AM) and the contractor.



ii. Project Manager shall ensure the approval of the TOC within

seven (7) days after commissioning.

iii. Parties to endorse TOC:

For GCC Contracts: Project Manager, AMD, AM, the contractor and ICT

Division (if necessary).

For FIDIC Contracts: Project Manager, AMD and the contractor (to be

attached with MDL)

3. POST COMMISSIONING

3.1 Project Financial Closing

i. After TOC is issued, Project Manager shall ensure that all progress payments have been settled (excluding Retention Sums).

ii. Project Manager shall declare that the project is technically

completed within 25 days (i.e. set the project to TECO in ERMS) for TNB Finance Division to capitalise the project.

3.2 Defect Management & Project Closing i. Project Manager shall ensure that all minor outstanding

works and defects are rectified by the contractor within the Defect Notification Period.

ii. After expiry of the Defect Notification Period, Project

Manager shall issue the Performance/Completion Certificate within two (2) weeks after all defects in master defect list have been cleared.

iii. Project Manager shall prepare the Project Completion Report

within three (3) months after full commissioning.



C. PROJECT CONTROL

1. PROJECT PROGRESS

i. Project Manager shall ensure that the contractor submit for

approval the project schedule within 28 days from the commencement date.

ii. The project schedule shall include:-

Order in which the contractor intends to carry out the

works, including anticipated timing of each stage of design, drawing review/approval, manufacture, inspection, delivery to site, construction, erection, testing and commissioning

Sequence and timing of inspection and tests specified in the contract

iii. Project Manager to review and approve the project schedule

submitted by the contractor.

iv. Project Manager to monitor all WBS activities in accordance with the approved schedule.

v. If at any time the actual progress is too slow and/or progress

has fallen behind the approved project schedule, then Project Manager shall give notice to the contractor to submit a recovery plan and supporting report describing the recovery method which the contractor shall propose to adopt in order to expedite progress and completion within the contract period.

vi. If there is any application from the contractor for an extension of time, Project Manager shall evaluate the application to ascertain the entitlement.



vii. Project Manager shall issue Liquidated Damages notice

accordingly if the delay is due to the contractor.

ii) PROGRESS REPORTING

i. Project Manager shall ensure that the project progress report is prepared and submitted monthly by the contractor by the seventh day of the following month.

ii. The project progress reporting shall continue until the

contractor has completed all works including any outstanding works as stated in the Taking Over Certificate.

iii. The project progress reports shall include but not limited to

the followings:-

Executive summary of project progress Project description and project data Project progress – design & engineering, procurement

of equipment and construction progress Project progress S-curve Project financial status Site safety and health reporting Site labour and manpower reporting Risk management and reporting Potential causes of delays and recovery plans Charts and details Photographs

iv. Project Manager shall update Project Progress Reporting in

TIPS monthly.



3. EXTENSION OF TIME (EOT)

i) In evaluating the application of EOT, Project Manager shall

consider the following criteria:-

Cause of the delay – to ascertain whether it is due to the contractor or TNB or third party.

Under which Clause of the Conditions of Contract the EOT is based upon.

Whether the contractor has given sufficient notice in accordance with the Conditions of Contract.

Whether the reasons for the delay are justifiable. Whether the period of EOT applied for is justifiable.

4. PROJECT INSURANCE

i) The Project Manager shall ensure that within 28 days from the commencement date and prior to any site activities, the contractor shall have submitted the required project insurances.

ii) The project insurances required are:-

Construction and Erection All Risks (CEAR) Public Liability Insurance Workmen Compensation

iii) Project Manager shall ensure that the insurance policies are

valid until the Taking Over Certificate for the whole project has been issued.

iv) The Project Manager shall ensure that the contractor submits

the insurance policy and payment receipts of the premiums.



v) For any shipment of equipment from overseas, Project Manager shall ensure that the cargo is covered by Marine Open Cover insurance.

5. PERFORMANCE SECURITY

i) The Performance Security for a contract shall be valid for the whole contract period including the defects liability period plus an additional six months period thereafter.

ii) The Project Manager shall monitor the validity of the

Performance Security to ensure that whenever the project is delayed, the Performance Security shall be extended accordingly.

6. DELAY DAMAGES

i) If the contractor fails to complete the project as required under the contract and after all reasonable EOT has been granted, the contractor shall be subjected to imposition of delay damages (DD) in accordance with the Conditions of Contract.

ii) The amount of liquidated damages shall be calculated as

follows:-

Amount of DD: 0.15% of the Total Contract Sum per day of delay

Limit of DD: 15% of the Total Contract Sum

iii) The Project Manager shall monitor the progress of the project in accordance with the approved schedule and the contractual completion date. When the contractual completion date is due and the contractor fails to complete all



the works as specified in the contract, the Project Manager shall issue a notice to the contractor informing the latter on the imposition of liquidated damages.

iv) The Project Manager shall evaluate and calculate the amount

of liquidated damages to be imposed, prepare a breach of contract report and liaises with Shared Purchasing Department to arrange for deduction of the liquidated damages.

7. PROGRESS PAYMENT

i) The Project Manager shall: Certifies work done for the purpose of progress

payments. Ensures that budget allocation is sufficient to effect

payments. Manages budget transfer so that payments could be

made. Ensures certification and processing of the contractor’s

invoices is done within the specified time period.

9. CONTRACT COST AND BUDGET

i) The Project Manager shall monitor the financial status of the project costing in relation to the Total Contract Sum. The Project Manager shall ensure that any potential Variation Order shall be submitted for approval to the relevant tender committee depending on the amount of the Variation Order. No work on such Variation Order shall proceed prior to the Variation Order being approved.

ii) The Project Manager shall monitor the budget expenditures

for the project. If there is a shortfall in the project budget, the



Project Manager shall apply for additional budget during Supplementary Budget session. The Project Manager shall state the reasons and justifications for the additional budget requested for.

iii) The Project Manager must also ensure that the budget

allocated for the current financial year is to be fully utilised.

10. QUALITY ASSURANCE

i) The Project Manager shall ensure that all civil works, equipments, installation and erection works are carried out in accordance with the technical specifications and quality standards as specified in the contract. To ensure that all equipments and works comply with the specifications and quality standards, the Project Manager shall ensure that all inspections and testing are carried out in accordance with the contract requirements. The inspections and testing shall include the followings:-

SCA FAT SAT RSV PIAT



D. GLOSSARY

1. ACRONYM AD - Asset Development Department AMD - Asset Management Department AM - Asset Maintenance Department BQ - Bill of Quantities DSR - Detail Study Report ENGR - Engineering Department ERMS - Enterprise Resource Management System FAT - Factory Acceptance Test FSR - Feasibility Study Report GM - General Manager (Asset Development) HSE - Health, Safety and Environment KOM - Kick off Meeting LA - Letter of Acceptance LIR - Land Information Report LOI - Letter of Intent NEFS - Notice to do Engineering Feasibility Study NFS - Notice to do Feasibility Studies NLPS - Notice to do Land Preliminary Study NLI - Notice for Land Information NLM - Notice to do Land Matters NNTE - Notice to do Notice to Enter NTE - Notice to Enter NTP - Notice To Proceed NTT - Notice To Tender P&C - Procurement & Contract Unit PC - Performance Certificate PEP - Project Execution Plan PIAT - Pre-Commissioning Inspection & Testing PIOP - Principal Installation of Plant PM - Project Manager (Asset Development) POL - Project Outline



PSR - Preliminary Study Report PTI - Land Management & Wayleave Unit RSV - Reliability Safety Verification SAFCA - Safety Compliance Audit SAT - Site Acceptance Test SCA - Specification Compliance Audit SGM - Senior General Manager (Asset Development) SO - System Operation Department SPD - System Planning & Development TIPS - Transmission Information on Project System TECO - Technically Complete TNB - Distribution Division TOC - Taking Over Certificate UKP - Project Coordination Unit



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Project Coordination Unit

Asset Development Department Transmission Division

Tenaga Nasional Berhad

All Rights Reserved

Level 2, Transmission Building, Tenaga Nasional Berhad, No. 129, Jalan Bangsar, 59200 Kuala Lumpur

Project Management Manual

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