1. Project Group No. 3 – Service Group
HAPUA
Project Group No. 3 – Service Group
SUB-GROUP NO. 3
HAPUA SPARES MANAGEMENT
Proposal for Bilateral Arrangement
Team Member:
Aznoran Mohd Noor
Rohaizad Samudin
26 February 2009

2. CONTENTS
HAPUA Generation Projects - Spare Management Sub- Working Committee
Objectives of Spares Management Project
Scope of Works
Updates on HAPUA Spare Management Sub-Working Group’s activities
Decision Made During 9th. HWG1 Mtg.
Malaysia’s Proposal

3. THE 3 HAPUA GENERATION PROJECTS
MALAYSIA
Mr. Ahmad Rashdi Jaafar
Project Group 3
- Service Group 3
THAILAND
Mr. Pithsanu Thongveerakul
Project Group 2
- Plant Performance Benchmarking & Database 2
INDONESIA
Mr. Bambang Susianto
Project Group 1
- Generation O&M 1
COUNTRY
LEADER
PROJECT GROUP NO
Sharing of repair facilities and service provider
Power Plant Engineering and Design
Spares management
SUB-WORKING
GROUPS UNDER
PROJECT GROUP NO3
3. Spares Management

4. Objectives of Spares Management Project
To reduce plant outages due to unavailability of spares by sharing
To reduce inventory level among member countries having similar plants e.g. sharing of large and expensive items such as transformers or rotors
To reduce the price of spares by having a better negotiating position with OEMs
To reduce the price of spares by having options whether to buy from OEMs or from alternative sources or to fabricate the parts through reverse engineering in recognised workshops

5. Scope of Works - Spares Management Sub-Working Group
To identify common strategic spares that can be shared among ASEAN Countries.
To come up with the mechanism of sharing of spares.
To set up spares pooling community and networking among members.
To share the knowledge and experience in the use of alternative parts.
To share information on the suppliers and manufacturers of alternative parts.
To share the knowledge and information in materials management initiatives.

6. Spares Management Sub-Working Group - 1st. Coordination Meeting
Date : Aug 2006
Host :EGAT, Thailand
Venue : Montien Hotel, Pattaya
Attendance:
Thailand (EGAT) – 9 persons
Vietnam (EVN) – 5 persons
Malaysia (TNB) – 3 persons
Philippines (NPC) – 2 persons

7. TNB’s representatives
The Delegates
TNB’s representatives

8. Activities During Coordination Meeting
- Sharing of information and experience on:
Gas Turbine Technology - initially focusing on Frame 9Es and MS 701F
Model, location and year commissioned of each GT.
History of operation and conditions
Experience in the use of alternative parts and Spares pooling
Materials Management Strategies and initiatives – optimizing stock value & cost savings initiatives

9. Meeting Outcomes/Status
Action Plans/Resolutions:
EGAT to come up with a standard format and compile all data on GT for all GT models-DONE.
EGAT and TNB to submit the list of all gas turbine models-DONE.
To proceed with the setting up of Data Warehouse & Information Network-IN PROGRESS
The sub-working committee to identify Frame 9E strategic spares that can be shared among ASEAN Countries-DONE.
To firm up with the mechanism of sharing the spares-IN PROGRESS

10. Proposed Information Network

11. Information Network for Frame 9E GT

12. Proposed Information Network for M701F

13. The way forward To schedule the 2nd. sub-working committee meeting.
To follow up on the action plans / resolutions from the 1st. Meeting.
To discuss and resolve issues / blockers (if any) that may hinder success.

14. Decision Made During 9th. Meeting of HWG1
Date : 12th November 2008
Venue : EGAT, Nonthaburi
Attendees : From 3 countries only i.e.
Indonesia Power (Mr. Darwis M. Daud)
EGAT (Mr. Pithsanu Thongveerakul)
TNB (Mr. Mohd Nazri Shahruddin)
Decision made : to continue with spares management / spares pooling project

15. MALAYSIA’S PROPOSAL

16. Spares Management Group Mtg. No. 1 (15th June 2007 in CBPS)
Resolutions
To share / pool strategic spares for Model Frame 9E strategic spares between TNB & EGAT
14 units of GE Frame 9E in TNB
18 units of GE Frame 9E in EGAT
To share / pool spares for Model Alstom GT 13E1strategic spares between TNB & Indonesia Power
4 Open Cycle units in CBPS,
6 Combined Cycle units in Tanjong Priok, Indonesia
Possibility of trading of spares/parts between HAPUA members

17. Spares Management Group Mtg. No. 2
Internal meeting No. 2 on 10th July 2007 in TNB REMACO PJ Office
Agenda
Detail discussion on each methodology
Finalizing milestone
To come up with details of MOU
To identify liaison person from EGAT and Indonesia Power
Next course of action
Meeting No. 3 – 18th Sept 2007
Agenda - discuss on Process Flow & MOU

18. Spares Management Group Mtg. No. 3
3rd meeting held on 18th Sept 2007
Finalized concepts on Spares Management
Reviewed and verified DRAFT MOU from Legal Services Department
Reviewed proposed action plan

19. Rationale for Bilateral Arrangements
TNB and EGAT
Adequate units of Frame 9Es to justify sharing and pooling
Pilot project before the model is extended to other HAPUA members
Very active in HAPUA spares management initiatives
Opportunity to reduce stock holding cost
TNB- CBPS and Tanjung Priok - Indonesia Power
Users of Alstom 13E1 in South East Asia
Proposed Pilot project - Bilateral arrangements between two utilities are easier to manage

20. Proposed Mechanism Principles
Based on mutual benefits / win-win strategy
Specific agreement for every transaction
Covers strategic spares which
Not available off shelf / at site
Emergency/urgent need
Require long lead time to deliver
High capital items
Methodology
Loan/purchase of existing new (unused) spares between utilities
Sharing / pooling of new (unused) spares

21. Proposed Concept – Loan/Purchase of Spares
Loan/purchase of new (unused) existing spares between utilities
New (unused) spares are available at either party
The loan/purchase must be based on mutual agreement without jeopardizing the operation of either utility
The replacement parts must be purchased and returned within an agreed period
All cost e.g. insurance, risk, logistics incurred shall be borne by the requestor

22. Proposed Concept –Purchase of Spares
Identify spares (new or refurbished) that can be sold / to be purchased
Willing seller – willing buyer concept
Mutually agreed Terms and conditions
Price
Payment terms
Delivery
Insurance & Logistics
Warranty issue

23. PROCESS FLOW CHART FOR LOAN OF SPARES
BETWEEN TNB & EGAT / INDONESIA POWER
REQUESTOR/
BORROWER
1.0 Preliminary inquiry on parts availability
2.0
Check / confirm availability
LENDER
Closed
3.0
Availability
of parts and
possibility
of borrowing? No
4.0
Forward official request & arrange logistic + insurance
5.0
Assist and arrange for parts delivery
Yes
8.0
Arrange for replacement parts delivery
7.0
Purchase of replacement parts
6.0
Delivery acceptance
9.0
Delivery acceptance of replacement parts

24. PROCESS FLOW CHART FOR PURCHASE OF SPARES
BETWEEN TNB & EGAT / INDONESIA POWER
BUYER
1.0 Preliminary inquiry on parts availability
Closed
4.0
Forward official request to purchase
6.0
Delivery acceptance
7.0
Arrange for payment No
3.0
Availability
of parts and
price confirmation
SELLER
Yes
2.0
Check / confirm availability
5.0 Aarrange for parts delivery & insurance
8.0
Acceptance of payment
Closed

25. Proposed Concept – Pooling of Spares
Pooling / Sharing of new (unused) spares
Identify and agree on expensive strategic spares that can be pooled to ensure reliability of plants
Establish a shareable database
Sharing / pooling issues to be detailed out
Cost sharing
Minimum stock level
Storage location & preservation
Logistics management
Insurance and risk management
Inventory replacement

26. Spares to be pooled have been purchased on cost sharing basis.
PROCESS FLOW CHART FOR POOLING / SHARING OF SPARES
BETWEEN TNB & EGAT / INDONESIA POWER
BORROWER /
REQUESTOR/
1.0 Preliminary inquiry on parts availability
Closed
4.0
Forward official request & arrange logistic + insurance
6.0
Delivery acceptance
7.0
Purchase of replacement parts
8.0
Arrange for replacement parts delivery No
3.0
Availability
of parts and
possibility
of borrowing?
LENDER
Yes
2.0
Check / confirm availability
5.0
Assist and arrange for parts delivery
9.0
Delivery acceptance of replacement parts
Closed
Assumptions:
Spares to be pooled have been purchased on cost sharing basis.
Utility which is responsible to keep the pooled spares have been identified and agreed.
Lender = utility which keeps the pooled spares, Borrower = utility which requires to use the pooled spares.

27. Issues In Implementation
Sharing and understanding the objectives, benefits and concern of this project by utilities in Thailand, Indonesia and Malaysia
Commitment from all parties
Legal issues
Inventory database
Further deliberation required to cover all other possible scenarios for implementation

28. Action Plan & Project MilestoneNo
Description
Target Date
Responsible Person
1.0
To draft proposal on concept and process flowchart
31 Aug 2007 (Completed) -
2.0
To draft MOU and verified by Legal Services Department
31 Aug 2007
(Completed)
3.0
To seek approval from VP Generation on concept and MOU
Mar 2009
Aznoran
To establish database
May 2009
Rohaizad
4.0
To discuss and get buy in on spares management concepts with
EGAT
Indonesia Power
Jun 2009
Team members
5.0
To sign MOU (draft copy of MOU has been distributed to attendees of HAPUA 8th. HWG1 Mtg, in Jan. 2008)
Aug 2009
6.0
To confirm strategic spares to be shared/pooled
Sept 2009

29. “Keeping the Lights On”
THANK YOU
“Keeping the Lights On”