Process Safety

Management
System Audit

Terms of Reference
 Document No. SR-65-19-01 ToR - PSM Audit

REV DATE DESCRIPTION PREPARED CHECKED APPROVED

A 18/11/2019 Issued for comments MSA

2 SR-65-19-01 ToR - PSM Audit

 TABLE OF CONTENTS

1.0 INTRODUCTION .......................................................................................................... 4

2.0 SCOPE ........................................................................................................................ 5

3.0 OBJECTIVE .................................................................................................................. 6

4.0 AUDIT APPROACH ...................................................................................................... 7

5.0 ELEMENT WISE AUDIT APPROACH ............................................................................ 11

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1.0 INTRODUCTION

As part of continuous improvement process, Hub Power Services Limited (HPSL) has
engaged M/S Shepherd Risk to assist them in carrying out audit of Process Safety
Management system across the company head office and operations. Muhammad Saim,
Senior consultant, Process Safety will assist HPSL, HPSL will dedicate a team of Process
Safety & HSE personnel for audit.
This document gives a brief outline of Audit Terms and methodology that will be adopted.
HPSL is requested to prepare for audit accordingly.

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2.0 SCOPE

Scope of audit activities will cover HPSL Head office and 3 Plant sites:
1. Hub Power Plant.
2. Narowal energy Limited (NEL)
3. New Bong Escape Power Plant (NBE), Laraib Energy

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3.0 OBJECTIVE

Process Safety Management system is the application of management systems to

protect life of people, the environment and the property from catastrophic events
resulting from loss of control over processes.

There are three key aspects of

Process Safety Management:
 Technical Integrity;
 Design Integrity and
 Operating Integrity
Process
Safety
Objective of a Process Safety
Managem
Management Audit is to assess the
ent
effectiveness of Safety Management
System and Culture at HPSL in
managing Design Integrity, Operating
Technical Integrity and Operations
Integrity
Integrity.
The impact of a change in design
integrity (standard, design concept,
etc.) can take 5 to 10 years, before positive change is seen.
Example: team decides to change the design standard for a process vessel. From
now on, no block valves are allowed in the vent lines anymore. This change will
only show it benefit many years after the first vessel has been designed and put
into operation.
The impact of technical integrity can be anywhere between 1 and 5 years.
Example, the company can decide to remove all block valves after process vessels
across the whole facility. This will take a while to get budget, plant shutdowns, do
the work, etc.
The impact of operational integrity can be (almost) immediate.
Example, the company can send out Standing Order that from now on all block
valves are identified and placed in locked-open after each process vessel.

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4.0 AUDIT APPROACH

Audit will be carried out based on:

 OSHA 29-CFR-1910 Audit Guidelines
 AIChE, CCPS Guidelines for PSM Audit
 Energy Institute PSM Audit guidelines

Since HPSL activities do not directly involve hazardous chemical process (not
directly involved with chemical, petrochemical or refining industry) hence OSHA
PSM 29.CFR.1910 is not fully applicable to HPSL operations, however, OSHA
29.CFR.1910.269 Occupational Safety and Health Standard for Electric Power
Generation, Transmission, and Distribution are directly applicable. Therefore the
audit will primarily be based on OSHA.29.CFR.1910.269.
Focus of the audit activities will be to assess whether the way organization is
currently operating is good enough in terms of Process Safety Management,
identify strengths and weaknesses and suggest actions to bridge the gaps to ensure
that organization is meeting industry best practices.
Overall audit process will be in three main steps:
1. Pre-Audit Activities
2. Audit Activities
3. Post Audit Activities

Audit activities will be based on site visit, interviews & discussions and document
reviews. Audit team will use experience and judgement in assessing the Process
Safety Performance aided by checklist and questionnaire.
In addition to focusing on Process Safety Management System Elements, the audit
team will carry out a Safety Perception Survey based on an employee & contractor
interviews and feedback.
Scope and activities of each of the three steps is detailed below:

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 1 - Pre_ audit Activities
Lead Muhammad Saim - Consultant
HPSL Saleem Qureshi
Kick Off Meeting
Who: Muhammad Saim +
HPSL Core Team
Venue: HPSL Head office
Date: TBA
Estimated duration: 4 hrs.
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 Introductions & objective setting
 Finalize audit Plan - Dates & Locations, allocate
resources
 Prepare onsite agenda - Element wise audit plan
 Review & finalize audit questionnaire
 Gather background information:
o Previous Audit Report. A copy of the
previous audit report
o Action Plan. Status report on the resolution
of previous audit exceptions Regulatory
Requirements. Copies of applicable local
regulations
o Corporate Policies. Copies of applicable
corporate policies, standards, and guidelines
o Facility Policy Manuals and Plans. Copy of
tables of contents from current facility safety
manuals, emergency plans, and other
documents covering policies, procedures,
and reporting requirements
o Facility Organization. Current facility
organization chart annotated to illustrate line
and staff responsibility for all process safety
areas under review, and to identify key
contact people
o Facility Layout. Maps or diagrams to
illustrate location of different operations and
of process safety and control system
components Process
o Descriptions: Discussion of process
operations, flows, chemicals and control
systems.
o Reports. Copies of selected process safety
status reports, self-audits, or other applicable
reports
o Incident Reports. Investigation reports for
recent episodic incidents
 2 - Audit Activities

Corporate Level Audit  Opening Meeting with Management & Leadership

 Individual Interviews - Senior Management/Team
Lead: Muhammad Saim Leaders
Support: Saleem Qureshi  Corporate Policies
 Commitment to Process Safety & Objectives
Location: HPSL Head
 Top Process Safety Risks & Action Plans
office
Date: TBA  PSM Element wise assessment
Estimated duration: 1 Day

Site Audit  Arrive at site

 Opening Meeting with Site Management
Lead: Muhammad Saim + o Introductions - All
Saleem Qureshi
o Audit Objectives & Plan - Consultant
Support: HPSL Audit o Site Briefing - Site Manager
Team  Audit Activities - Team split as per element wise audit
plan
Location: Plant Sites - Hub, o Site visit
NLE, NBE o Interviews - Managers, Supervisors,
Date: TBA
Estimated duration: 1.5
Operators, Technicians, Labor, Contractors
Day each site etc.
o Documentation & Data Review
 Audit Team meeting - notes compilation
 Close out meeting with site management

3- Post Audit Activities

Compilation of Audit  Share Element wise Audit Findings - Strengths,

Findings Weaknesses, Observations
 Submit element wise report and checklist to
Participants: Audit Team consultant
Location: HPSL Head
office  Element wise rating
Date: TBA
Estimated duration: 4 hrs.

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 Audit Report  Draft Report
 HPSL Comments on Draft Report
 Final Report & Presentation

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5.0 ELEMENT WISE AUDIT APPROACH

Table below lists key aspects of audit against each element:

Element Key Audit Aspects

 Are the PSM Policies, Objectives and

Management Commitment Goals defined and communicated by
senior management & leadership to
entire organisation effectively, this
includes contractors?
Policies & Principles
 Does the Leadership demonstrate
commitment to PSM Objectives & Goals
Management Leadership & Commitment

by providing adequate resources

Integrated Organization (manpower, finance, time)?
Structure
 Are PSM KPIs defined, measured and
steered at leadership levels?

 Are employee benefits (e.g. annual

Line Management increment, bonus) linked to PSM KPIs?

 Is the PSM organisation (e.g. HSE)

independent of site management
Accountability & Responsibility influences i.e. reporting directly to
senior leadership vs. reporting to site
manager?

 Are competencies of core PSM / HSE

Goals, Objectives, & Plans
positions defined?

 Are competent and experienced

personnel appointed on all approved
Safety Personnel PSM/HSE positions?

 Is there a system in place to collect and

maintain necessary Process Safety
Technology

Information?

Process Safety Information  Does a system exist to ensure that data

are accurate, reliable, and up-to-date,
and that process safety information is
available to all personnel who need to
have access to it?

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  Is there a program in place and
executed for Process Hazard & risk
Analysis?

 Are the risk tolerability criteria defined?

Are all risks within ALARP or acceptable
limits?

 Are applicable PHRA tools and

techniques clearly defined and
procedures and mythologies
documented?

 Are competencies for leading and

participating in PHRA techniques
Process Hazard & Risk Analysis defined and developed within
organization?

 Is there a plan in place for periodic

execution of PHRAs and is being
followed?

 Is there a system in place for monitoring

timely implementation of
recommendations from PHRAs?

 How are delays and deferments in

implementation of PHRA
recommendations handled, does the
management declare it an incident (API
754)

 Is there are system in place for periodic

review and update of operating
procedures?

 Are all operating procedure current and

Operating Procedures & updated? Reflecting latest PSI and
Practices PHRAs?

 Are operating procedures covering all

modes of operation, including normal,
shutdown & startup and emergency?

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  Are safe upper and lower operating
limits defined?

 Is there a system in place for managing

changes - facility, technology and
Personnel?

 Does the Change Management

Management of Change procedure define type of changes
covered under the subject?

 Does the change management

procedure define the need for PHRAs as
applicable to the change?

Is there a documented procedure in place

Pre Start-up Safety Review
for Pre-Start-up Safety Reviews?

Has the company defined international

standards, guidelines, and industry practices
for Design, Fabrication, Procurement and
installation of critical equipment?

Has the company defined inspection &

testing requirements for fabrication,
installation and maintenance?

Are procedures for inspection and

maintenance well defined?
Facilities

Has the company adopted RBI, RCM based

Electrical & Mechanical Integrity
maintenance plans?

Are Safety Critical Elements and Activities

listed and performance standards included,
proof test intervals, and proof test
procedures defined, documented and
followed?

Are maintenance and inspection personnel

well trained/certified in relevant tasks?

Is there any overdue maintenance of any

Safety Critical Equipment?

Quality Assurance Are quality assurance requirements for

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 design, procurement, fabrication and
installation defined and documented?

How are process safety training objectives

set?

At what level of the organization is this

done?

How frequently is this assessment made,

and by whom?

At what level of the organization does this

training take place?

Who is assigned primary responsibility for

the training?
Training & Performance
How is input provided from other groups to
ensure that integration of a specific subject
into the overall training program will be
correct?

After development of the training materials,

who has the responsibility and authority for
validating the completeness and accuracy of
the materials?

Has the validation actually taken place?

Are training records maintained? Available?

Are contractors involved in every aspect of

PSM Program and necessary trainings
given?

Are contractor workers competency

Contractors
defined, and assessed?

Is contractor work force aware of their

contribution, and responsibilities towards
PSM?
Personnel

Is there a procedure/guideline in place for

Incident Investigation incident reporting and investigation?

Are there any trained incident investigators

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 in the organisation?

Are lessons from incident investigations

shared with all including employees and
contractors?

Are comprehensive Emergency Response

Plans in place?

Is ER organisation defined and known to all

including employees, contractors and govt
agencies?

Area ER plans based on scenarios identified

and assessed in PHRA studies?
Emergency Planning &
Response Are adequate resources required to execute
ER plan, should an undesirable event
occurs, available?

How are govt and external agencies

involved in ER planning?

Are trainings, testing and drills on ER plan

conducted regularly?

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 Annexure I
PSM Audit Questionnaire
(will be given later)

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 Annexure II
Safety Perception Audit Check list
(will be given later)

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