1 20/10/2004 Petroleum Development Oman Xxxxxxxxxxx (Audit Title) HSE MS Audit Xxxxxx (Period)

2 20/10/2004 Agenda Audit team Audit team Terms of reference Terms of reference Methodology Methodology Schedule Schedule Audit opinion Audit opinion Classification of findings Classification of findings Positives – Negatives Positives – Negatives Review of 8 HSE MS elements Review of 8 HSE MS elements Audit follow-up Audit follow-up

3 20/10/2004 Team Members  xxxxxxxxxxxxxx

4 20/10/2004 Terms of Reference 1 Objective: The objective of the audit is to assess the effectiveness of the HSE Management System and Operational Controls in the xxxxxxxxxxxxxxxxxx.

5 20/10/2004 Terms of Reference 2 (SCOPE) Special attention will be given to: Adherence to PDO HSE policiesAdherence to PDO HSE policies The process used for preparation and validation of the HSE Assurance Statements as part of the Annual Assurance ProcessThe process used for preparation and validation of the HSE Assurance Statements as part of the Annual Assurance Process Adherence to PDO Minimum Environmental StandardsAdherence to PDO Minimum Environmental Standards Processes for the identification of HSE-related legislative requirements, their dissemination, and for confirming adherence to themProcesses for the identification of HSE-related legislative requirements, their dissemination, and for confirming adherence to them Completeness of the identification of HSE critical activities, roles, responsibilities and competency requirements associated with HSE critical activitiesCompleteness of the identification of HSE critical activities, roles, responsibilities and competency requirements associated with HSE critical activities Implementation of HSE training program’s to close competency gaps for those carrying out of HSE critical activitiesImplementation of HSE training program’s to close competency gaps for those carrying out of HSE critical activities Availability and effectiveness of required procedures for the identification and control of all significant hazards and effects including the demonstration of ALARPAvailability and effectiveness of required procedures for the identification and control of all significant hazards and effects including the demonstration of ALARP Responsibilities, accountabilities and effectiveness of individual HSE tasks and targets and their contribution to continuous performance improvementResponsibilities, accountabilities and effectiveness of individual HSE tasks and targets and their contribution to continuous performance improvement

6 20/10/2004 Terms of Reference 3 (SCOPE CONT’D) Effectiveness in HSE data management and HSE performance monitoringEffectiveness in HSE data management and HSE performance monitoring Effectiveness of HSE documentation and the processes for its disseminationEffectiveness of HSE documentation and the processes for its dissemination Effectiveness of controls with respect to safeguarding of asset integrityEffectiveness of controls with respect to safeguarding of asset integrity Effectiveness of change control proceduresEffectiveness of change control procedures Requirements for contractors to have an implemented HSE policy and MSRequirements for contractors to have an implemented HSE policy and MS Completeness of HSE CasesCompleteness of HSE Cases Adequacy of emergency response procedures and contingency plansAdequacy of emergency response procedures and contingency plans Confirmation that findings from audits, inspections and incident investigations have been satisfactorily addressed, and closed out in an auditable processConfirmation that findings from audits, inspections and incident investigations have been satisfactorily addressed, and closed out in an auditable process Identification of significant gaps in the implementation of the HSE MS which have not been recognised, or for which no prioritised and resourced remediation plan is in place.Identification of significant gaps in the implementation of the HSE MS which have not been recognised, or for which no prioritised and resourced remediation plan is in place. Adequacy and monitoring of the Electrical Infrastructure HSE PlanAdequacy and monitoring of the Electrical Infrastructure HSE Plan

7 20/10/2004 Standards The audit was conducted in accordance with methodology in EP (December 1999) The Audit was conducted against the following standards (in order of priority):  Oman laws and regulations  PDO HSE policy  PDO HSE-MS as documented in the HSE Code of Practice Manual CP-122  PDO standards and procedures  Group and SIEP HSE policies, commitments & guidelines such as EP95 000

8 20/10/2004 Areas Visited Facilities Maintenance, Operations and Construction activity taking place in xxxxxxxxxx In particular: xxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxx

9 20/10/2004 Audit Process Terms of reference Audit programme Audit programme EP EP Familiarisation Review & Testing Reporting Site visit Interviews Test findings Drafting Editing Report Finalisation Agree findings Present Findings Study Documentation TODAY!

10 20/10/2004 Objectivity Balanced Team (Yes? Contractor!) Balanced Team (Yes? Contractor!)  xxxx, xxx, Independence Independence  Yes, one team member involved from audited operation Defined Process Defined Process  EP Standard Approach Standard Approach  8 HSE-MS elements  Base questionnaires  Standard evaluation sheets

11 20/10/2004 Audit Assessment Level of concern: Specific Level of concern: Overall scope for enhancement Good Fair Level of concern: Overall cause for concern Level of concern: Overall cause for grave concern Poor Unacceptable Unacceptable

12 20/10/ Weakness Classification Matrix PeopleAssets Environ- ment Repu- tation Severity No injury Slight injury Minor injury Major injury Single fatality Multiple fatalities No damage Slight damage Minor damage Local damage Major damage Extensive damage No effect No impact Slight effect Slight impact Minor effect Minor impact Localised effect Consider- able impact Major effect National impact Inter- national impact Massive effect Never heard of in EP industry A Low Medium High Has occurred in EP industry B Has occurred in the audited OU CD Happens several times a year in the audited OU E Happens several times a year in the audited facility High: Though not serious, essential to be brought to Management attention. Includes medium weaknesses as repeat from previous reports. Low: No major HSE impact at process level, correction will assure greater effectiveness/efficiency in process concerned. Serious: Exposes OU to a major extent in terms of achievement of corporate HSE objectives or results. Medium: Could result in perceptible and undesirable effect on achievement of HSE objectives. Serious

13 20/10/2004 Audit Opinion Serious: 0 Serious: 0 High: 2 (Reporting) High: 2 (Reporting) Medium: 16 Medium: 16 Low: 9 Low: 9 Total: 27 Total: 27 Overall Audit Opinion: XXXX

14 20/10/2004 Audit Opinion 0 0 0/F -  0 0 My -  0 F F -  0 F F/My My   0 My - -  >  Key: F = few 40 Findings Most Favourable Opinion S H M H+M Unacc. Poor Fair Good

15 20/10/2004 Classification of Findings Each Finding is categorised as follows: 1.Category:  People (P), Assets (A), Environment (E) or Reputation (R) 2.Severity level (from Weakness Classification Matrix):  Serious (S), High (H), Medium (M) or Low (L) 3.Each Finding is assigned to one HSE MS element 4.A Finding is accompanied by the Significance and one or more Recommendations to address the gap.

16 20/10/2004 Classification of Findings Each Finding is categorised as follows: 1.Category:  People (P), Assets (A), Environment (E) or Reputation (R) 2.Severity level (from Weakness Classification Matrix):  Serious (S), High (H), Medium (M) or Low (L) 3.Each Finding is assigned to one HSE MS element 4.A Finding is accompanied by the Significance and one or more Recommendations to address the gap.

17 20/10/2004 Findings Classification

18 20/10/2004 Positive Findings System Integrity is being maintained at high level. Additional power requirements are being met in a timely manner Role of CFDH is being discharged well. (Authorisation of Staff, Issue of Standards and Proceedures, Technical Support to Assets

19 20/10/2004 Areas of Concern XXXXXXX

20 20/10/2004 1: Leadership and Commitment Positive XXXXXX Area’s for improvement XXXXXX XXXXXX

21 20/10/2004 2: Policy & Strategic Objectives Positive XXXXXX XXXXXX Area’s for improvement XXXXXX XXXXXX

22 20/10/2004 3: Organisation, Responsibilities, Resources, Standards and Documents Positive XXXXXXX XXXXXXX Area’s for improvement XXXXXXX XXXXXXX

23 20/10/2004 4: HEMP Positive XXXXXXX XXXXXXX Area’s for improvement Area’s for improvement XXXXXXX XXXXXXX

24 20/10/2004 5: Planning and Procedures Positive XXXXXXX XXXXXXX Area’s for improvement XXXXXXX XXXXXXX

25 20/10/2004 6: Implementation & Monitoring Positive XXXXXXX XXXXXXX Area’s for improvement XXXXXXX XXXXXXX

26 20/10/2004 7: Audit Positive XXXXXXX XXXXXXX Area’s for improvement Area’s for improvement XXXXXXX XXXXXXX

27 20/10/2004 8: Management Review Positive XXXXXXX XXXXXXX Area’s for improvement XXXXXXX XXXXXXX

28 20/10/2004 Audit Follow-Up Review findings and recommendations Review findings and recommendations Identify action parties Identify action parties Agree and prioritise actions, set XXX Agree and prioritise actions, set XXX Resource actions Resource actions Develop implementation schedule Develop implementation schedule Set-up reporting and review programme Set-up reporting and review programme Monitor follow-up progress to close out Monitor follow-up progress to close out XXX responsibility !

29 20/10/2004 The End of the Close Out Presentation