eskomESKOM

Supplier Contract Quality Requirements Specification Division

Title: Supplier Contract Quality Requirements Specification

Unique Identifier: QM-58

Area of Applicability: E

Documentation Type: PC

Revision: 0

Total Pages: 58

Next Review Date: March 2015

Disclosure Classification: CONTROLLED DISCLOSURE

Supplier Contract Quality Requirements Specification

CONTROLLED DISCLOSURE When downloaded from the EDS database, this document is uncontrolled and the responsibility rests with the user to ensure it

is in line with the authorized version on the database.

Unique Identifier: QM-58 Revision: 0 Page: 2 of 58

CONTENTS Page

1. INTRODUCTION ...................................................................................................................................................... 4 2. SUPPORTING CLAUSES ........................................................................................................................................ 4

2.1 SCOPE .............................................................................................................................................................. 4 2.1.1 Purpose ..................................................................................................................................................... 4 2.1.2 Applicability................................................................................................................................................ 4

2.2 NORMATIVE/INFORMATIVE REFERENCES .................................................................................................. 4 2.2.1 Normative .................................................................................................................................................. 4 2.2.2 Informative ................................................................................................................................................. 4

2.3 DEFINITIONS .................................................................................................................................................... 5 2.3.1 Eskom Definitions ...................................................................................................................................... 5

2.4 ABBREVIATIONS .............................................................................................................................................. 7 2.5 ROLES AND RESPONSIBILITIES .................................................................................................................... 8

2.5.1 Division of Responsibilities ........................................................................................................................ 8 2.5.2 Eskom ........................................................................................................................................................ 8 2.5.3 Contractor .................................................................................................................................................. 9

3. ESKOM RIGHTS (NOT LIMITED TO THE FOLLOWING): ................................................................................... 10 3.1 GENERAL REQUIREMENTS ......................................................................................................................... 11

3.1.1 QUALITY MANAGEMENT POLICY ........................................................................................................ 11 3.1.2 IMPLEMENTATION ................................................................................................................................ 11 3.1.3 QUALITY MANAGEMENT IN ENGINEERING ....................................................................................... 12

3.1.3.1 Design Quality Plan ......................................................................................................................... 12 3.1.3.2 Design Planning and Control .......................................................................................................... 12 3.1.3.3 Design Quality Planning .................................................................................................................. 13 3.1.3.4 Criticality Assessment and Application ........................................................................................... 14 3.1.3.5 Design Inputs .................................................................................................................................. 15 3.1.3.6 Design Outputs................................................................................................................................ 15 3.1.3.7 Design Verification .......................................................................................................................... 15 3.1.3.8 Inter-discipline Check and Review (Squad Check) ......................................................................... 16 3.1.3.9 Design Validation (Including Software Validation) .......................................................................... 16 3.1.3.10 Design Changes ............................................................................................................................ 16 3.1.3.11 System and Sub-System Lists ...................................................................................................... 17 3.1.3.12 Design Element Identification, Traceability, and Composition Verification ................................... 17 3.1.3.13 Design, Safety and Model Reviews. ............................................................................................. 18 3.1.3.14 Constructability Maintainability, Operability Reviews .................................................................... 18

3.1.4 QUALITY MANAGEMENT IN FABRICATION & CONSTRUCTION ....................................................... 18 3.1.4.1 General ............................................................................................................................................ 18 3.1.4.2 Quality Audits and Related Quality Performance Reviews ............................................................. 20 3.1.4.3 Eskom Right of Access ................................................................................................................... 21

3.2 TENDER SUBMISSION PHASE ..................................................................................................................... 21 3.2.1 Contractor documents with the tender .................................................................................................... 21 3.2.2 The Contractor shall submit a draft Contract Quality Plan (CQP) with the tender. ................................. 22

3.3 TENDER EVALUATION, ADJUDICATION AND NEGOTIATION PHASE ..................................................... 23 3.3.1 Subcontracting......................................................................................................................................... 23

3.4 CONTRACT AWARD PHASE ......................................................................................................................... 26 3.5 CONTRACT AWARD AND QUALITY CONTROL PHASE ............................................................................. 27

3.5.1 Pre-contract execution ............................................................................................................................ 27 3.5.1.1 Supplier and subcontractor Quality Management Plan .................................................................. 27 3.5.1.2 Supplier and Subcontractor Inspection and Documentation Requirements ................................... 28

3.5.2 Contract execution .................................................................................................................................. 31 3.5.3 Inspection Reports .................................................................................................................................. 31 3.5.4 Non-conformance Reports and Log ........................................................................................................ 32





3.5.5 Contractors inspection and testing ......................................................................................................... 33 3.5.6 Verification of purchased product ............................................................................................................ 33 3.5.7 Third Party Inspection ............................................................................................................................. 36

3.5.7.1 AIA ................................................................................................................................................... 36 3.5.7.2 Eskom appointed AIA organization ................................................................................................. 36

3.5.8 MATERIALS MANAGEMENT PROGRAM ............................................................................................. 37 3.5.8.1 General ............................................................................................................................................ 37

3.5.8.1.1 Traceability .............................................................................................................................. 37 3.5.8.1.2 Positive Material Identification ................................................................................................ 38 3.5.8.1.4 Quantitative quality measurement tools .................................................................................. 38 3.5.8.1.5 Preservation ............................................................................................................................ 38

3.5.9 Expediting during contract execution ...................................................................................................... 41 3.5.10 Quality Control on Completion of the Contract ...................................................................................... 42

3.5.10.1 Manufacturing Record Books. ....................................................................................................... 42 3.6 SUPPLIER QUALITY PERFORMANCE MONITORING PHASE ................................................................... 43 3.7 E-QUALITY TOOL (ACHIEVER PLUS) .......................................................................................................... 44 3.8 PAYMENT AND DELIVERY ............................................................................................................................ 44

4. AUTHORIZATION .................................................................................................................................................. 45 5. REVISIONS ............................................................................................................................................................ 45 6. DEVELOPMENT TEAM ......................................................................................................................................... 45 APPENDIX A : TENDER & CONTRACT QUALITY REQUIREMENTS .................................................................... 47 APPENDIX B : QUALITY REQUIREMENTS FOR ISO 9001 SERIES ..................................................................... 48 APPENDIX C : TEMPLATE FOR A TYPICAL CONTRACT QUALITY PLAN ......................................................... 49 APPENDIX D : DEFECT NOTIFICATION ................................................................................................................. 53 APPENDIX E : CAR ................................................................................................................................................... 54 APPENDIX F : CONCESSION ................................................................................................................................... 55 APPENDIX G : CONCESSION .................................................................................................................................. 56 APPENDIX H: REQUIREMENTS FOR A PRODUCT VERIFICATION PLAN .......................................................... 57 APPENDIX I: QUALITY CONTROL PLAN/INSPECTION & TEST PLAN ................................................................ 58





1. INTRODUCTION

This specification is to specify and describe the minimum quality requirements for all existing and potential Eskom Contractors and Suppliers, and to define the quality criteria for the evaluation, selection and monitoring of same.

2. SUPPORTING CLAUSES

2.1 SCOPE

2.1.1 Purpose

The purpose of this specification is to specify the requirements by which Contractors and Suppliers shall manage, implement, maintain and continually improve a quality management system (QMS) based on ISO 9001:2008 (or latest applicable revision). The intention is that Contractors and Suppliers should continuously adhere to Eskoms quality requirements in respect of the supply of products and related services.

2.1.2 Applicability

This specification applies to all employees, entities, suppliers and Contractors involved in Eskom new build and operating and maintenance programme (plant refurbishment, engineering, procurement, manufacturing, installation, and commission works). When applied to a particular contract, the relevant clauses of ISO 9001:2008 (or latest applicable revision) and the business processes requirements are indicated on the enquiry/contract/order quality requirement forms (see Annexure A and B) This specification will be applicable to any type of contract, where the wording as well as applicable aspects shall be customised to the specific contract, and reflected in the contract document to be signed by Eskom and the supplier.

2.2 NORMATIVE/INFORMATIVE REFERENCES

Parties using this document shall apply the most recent edition of the documents listed in the following paragraphs.

2.2.1 Normative

[1] ISO 9001:2008 Quality Management Systems Requirements [2] ISO 9001:2005 Quality Management Systems Fundamentals and Vocabulary [3] ISO 10005:2005 Guidelines for Quality Plans Standard [4] ISO 10006:2003 Guidelines for Quality Management Systems in Projects [5] ISO 90003, Software Engineering Guidelines for the Application of ISO 9001

2.2.2 Informative

[6] ISO 9004:2009 Managing for the Sustained Success of an Organization A Quality Management Approach

[7] NEC family of contract documents, as applicable to the specific contract





[8] FIDIC form of contract, as applicable to the specific contract

2.3 DEFINITIONS

2.3.1 Eskom Definitions

a. Supplier The word supplier refers to the Contractor

b. Customer The word customer refers to Eskom Holdings SOC Limited (in the context hereof referred to as Eskom)

c. Contractor A group of people and facilities (corporation, firm, enterprise, institution etc.) with an arrangement of responsibilities, authorities and relationships. It also refers to supplier, consultant and service provider

d. Subcontractors An organization or legal entity that provides a product to the supplier and/or that enters into a

subcontract and assumes some of the obligations of the supplier or prime Contractor e. Inspection Agency

An organization or person appointed by Eskom for the purpose of performing quality assurance or quality control monitoring and or inspection services

f. Approved Inspection Authority An organization or person approved by the Chief Inspector, South African Department of Labour, in terms of the Occupational Health and Safety Act 85 of 1993 and appointed by Eskom

g. Regulatory body A person or persons representing a statutory body as required by law

h. Works All deliverables expected from the Contractors as per the scope of works, requirements specified in the request for tender

i. Major plant items Plant and Material items (e.g. components, works that have an impact on safety of staff or equipment, the environment, plant reliability and availability and are of a high cost (Refer to Guideline GGG 1099 General Plant level Classification). This also includes Transmission Primary and secondary Plant items, and same for Distribution.

j. Refurbishment Restoration to a sustainable usable state or as near as possible to new state (within agreed limits)

k. Quality Control Plan (QCP) A document specifying the activities to be inspected throughout the execution of the project, inclusive of test methods, procedures and acceptance criteria. (This term is equivalent to QIP and ITP)

l. Contract Quality Plan A document compiled, as required by the Contract Quality Requirements Specification, by a Contractor which spells out the aspects of the quality management system to be applied within a





specific Eskom project, and the methods to be utilized to ensure quality assurance, control and improvement of the identified activities that they will be carried out as stated in the Works Information to ensure that the product/service meets Eskom requirements (This document can be viewed as a combination of a PQP and QCP)

m. Intervention points Intervention points are those control points indicated by the various controlling bodies concerned with the implementation of a specific QCP / ITP. These can be in the form of tests, inspection, surveillances, witnessing, reviews, failure and incident investigations)

n. Hold points An activity of an inspection and test plan which must be notified by the Contractor to Eskom and beyond which work shall not proceed without the attendance of Eskoms representative or the written approval of Eskom to proceed.

o. Surveillance Point Random monitoring of work processes and tests.

p. Witness point An activity on an inspection and test plan where work may proceed providing Eskom or Authority/Agency has been notified as required and the latter has indicated that they will not execute the intervention point

q. Document review A review of the records developed by a Contractor to ensure that the relevant activity has been performed satisfactory and that contractual requirements have been met

r. Project Quality Representative The most senior person responsible for the management and administration of the Quality System at the project/site/department. This includes an external Contractor appointed by Eskom to perform this function

s. Technical expert This term refers to a person responsible for and fulfilling the role concerned with the technical aspects and integrity of the project, service, or process in respect of the specific contract (e.g Eskom Engineer , IT Specialist, Auditor)

t. Advisory expert This term refers to a person responsible for and fulfilling the role of providing specialist advice, as may be determined and required in connection with any relevant aspect of the review (e.g. Legal Advisor, Financial Advisor etc). This person is only called upon on a need basis

u. Contract Manager/Expert This term refers to a person responsible for fulfilling the role concerned with the contractual aspect of the Eskom Commercial relationship with the Contractors in respect of the specific contract (e.g. Package Manager)

v. Quality Dossiers An indexed file containing all applicable records, documentation, certificates, data package, and other data applicable to the works. The Quality Dossier will be reviewed during the turnover process)

w. Data Package





All documentation and certification required to be issued by the Contractor in order that the takeover can be certified by Eskom (An index of data packages must be established before commencement of works)

x. Criticality Rating The risk ranking of structures, materials, equipment, components and/or systems determined on the basis of either FMECA/FMEA, HAZOP studies/reports or any applicable risk and criticality bases.

y. FMECA Failure Mode Effects and Criticality Analysis (PGZ 45-25 - FMECA Studies).

z. HAZOP Hazard and Operability Study (PGZ 45-24 - HAZOP Studies)

zz. Surveillance Point Random monitoring of work processes and tests.

2.4 ABBREVIATIONS

Abbreviation Description AIA Approved Inspection Authority CV Curriculum Vitae

CQP Contract Quality Plan ISO International Standards for Organization QC Quality Control ITP Inspection and Test Plan

NEC New Engineering Contract OHSA Occupational Health and Safety Act PED Pressure Equipment Directive PER Pressure Equipment Regulation PQP Product / Project Quality Plan PVP Product Verification Plan QCP Quality Control Plan DRC Document Return/Review Code QIP Quality Inspection Plan QMS Quality Management System inclusive of project requirements SABS South African Bureau of Standards SANS South African National Standard NEC New Engineering Contract RFQ Request for Quotation MOC Management of Change CQP Contract Quality Plan, including Project and any related Life Cycle Requirements CAP Contract Administration Plan





Abbreviation Description AVL Approved Vendor List NDT Non Destructive Testing NDE Non Destructive Examination O&M Operating & Maintenance Manual

NOBO Notifying Body NCR Non Conformance Report PMI Positive Material Identification PQR Procedure Qualification Record WQR Welders Qualification Record WPS Welding Procedure Specification HES Health, Environmental, Safety MRB Manufacturing Record Books BOD Basis of Design FEED Front End Engineering Design

CFCCQMP Contractor Fabrication, Construction and Completions Quality Management Plan NORFI Notification of Readiness of Inspection CAP Contract Administration Plan I&TN Inspection and Test Notification RCA Root Cause Analysis

2.5 ROLES AND RESPONSIBILITIES

2.5.1 Division of Responsibilities

The Division of Responsibilities section identifies the interactions and responsibilities of Eskom and the Contractor during the performance of work. This document together with the Project Procedures describes administrative and procedural requirements that the Contractor must satisfy in accomplishing the work.

2.5.2 Eskom

2.5.1.1 Co-ordinate the work of the Contractor with activities of Eskom and other Contractors and service providers directly hired by Eskom. 2.5.1.2 From reports compiled by the Contractor, evaluate the performance of the work of the Contractor, suppliers and Subcontractors regarding schedule, quality, cost, safety and requirements for compliance with the Contract and bring any deficiencies of which Eskom is aware to the attention of the Contractor such review shall not relieve Contractor of its responsibilities. 2.5.1.3 Perform technical appraisal of the Contractors work efforts. Appraisal will be by specialist personnel and will be co-ordinated with the aforesaid parties. 2.5.1.4 Furnish or cause to be furnished the services of any service Suppliers as Eskom may wish to employ in connection with the Project.





2.5.1.5 Obtain support and agreement from Eskom finance and procurement organisations to establish and manage the Project quality Budget.

2.5.3 Contractor

2.5.2.1 Provide Eskom with information as requested for appraisal of the Contractors, Sub-Contractors and suppliers performance of the Project, including but not limited to, copies of calculations, Construction Documents in preparation, purchasing and contracting documents, estimates, schedules, progress measurements, cost reports, etc. 2.5.2.2 Evaluate and assume full responsibility for all design work including that performed by the Sub suppliers, material/equipment suppliers and Sub-contractors including shop drawings and samples for quality, conformance to design, and safety. The Contractor shall be responsible for construction means, techniques, methods and procedures. 2.5.2.3 Maintain effective liaison as required to co-ordinate and expedite transmission and interpretation of Construction Documents, to implement necessary design changes or modifications, and to resolve technical problems. All formal communications with suppliers and Sub-contractors shall be through the Contractor. 2.5.2.4 Conduct regularly scheduled meetings with Eskom to discuss status of various stages of the Project, methods for resolving difficulties encountered or foreseen and other topics pertinent to the Project. Record and issue minutes promptly after each meeting. Conduct regularly scheduled meetings with Eskom to provide constructability input and other information regarding economy of design. 2.5.2.5 Process changes in accordance with the agreed Project change management procedure. 2.5.2.6 Issue monthly and quarterly progress reports to Eskom in accordance with agreed Project requirements. 2.5.2.7 Maintain a comprehensive filing system in a format and location to be agreed with Eskom, to provide a current basis for all documents, decisions, disposition of directives and inquiries, and information exchanged among the parties including agreements and modifications thereto. 2.5.2.8 Formulate and implement procedures to protect Eskoms proprietary information during the performance of the Project. 2.5.2.9 Administer work performed by the suppliers and Subcontractors and monitor for quality, cost, schedule, progress, and safety. 2.5.2.10 Provide data, as required, to permit prompt resolution of technical problems and implementation of any necessary changes and modifications. 2.5.2.11Submit to Eskom those items requiring advance approval, including but not limited to the following: schedules, overtime requirements, submittals, travel plans for its personnel and its supplier and Subcontractors personnel assigned to the field staff as well as for other personnel, schedules and plans for temporary facilities, tools and equipment, and labour force build-up and run-down of the supplier and Subcontractors. 2.5.2.12 Distribute correspondence originating with the Contractor in accordance with the Correspondence Project Procedure. 2.5.2.13 Ensure all aspects of the Project are carried out fully in accordance with the requirements of the Contract. 2.5.2.14 Ensure progress of the Project meets the requirements of the Baseline Control Project Schedule and milestone dates, and the Control Budget. 2.5.2.15 Ensure that the Project Quality Plan is implemented and is effective in controlling the quality of critical items in the Projects.





2.5.2.16 Ensure that the Project Safety Plan is implemented and is effective in controlling the safe implementation of the Projects. 2.5.2.17 Develop and provide reports to the Eskom Project Manager detailing the status and anticipated completion of the Projects, in terms of cost, schedule, progress, earned value and quality. These reports must be developed by the Contractor and formatted in accordance with Eskom requirements. 2.5.2.18 Liaise with the Eskom Project Manager regarding the status of the Projects and specific problem areas. 2.5.2.19 In a timely manner, review with the Eskom Project Manager any aspect of the Projects or the Project that the Contractor believes could have an impact on total cost, schedule, or quality of the Project and agree to a course of action. 2.5.2.20 Liaise with local and regional authorities during approvals and ensure that all statutory requirements are met. This shall include developing proposals and applications on behalf of Eskom for statutory and third party approvals or submissions as may be required. (Some sites will require all liaisons with local and regional Authorities to be addressed via their own Eskom representative.) 2.5.2.21 Provide Eskom with evidence and assistance in demonstrating the integrity of the design, engineering and management services, and control over execution of the Project as may be required. 2.5.2.22 Ensure that timely and efficient procedures and work methods are adopted during the execution of the Project. (These should be detailed for the individual project.) The Contractor is particularly required to address areas of interfaces with other Eskom organisations and departments. 2.5.2.23. The Contractor shall, at least 90 days prior to the start of Construction, provide Eskom with a detailed procedure for setting up the Project Bank Account. The procedure shall also describe a detailed process to administer the account including the use of the application for funding

3. ESKOM RIGHTS (not limited to the following): To expect that the Works will be conducted in accordance with the contract between the parties. Access to Contractors information as determined by applicable legislation Eskom reserve the right to oversee Contractor audit programs by participating in selected audits

as an observer, and by assessing Contractor at key work stages. Eskom will coordinate with Contractor to develop an oversight schedule aligned with Contractor audit schedule.

To obtain access to any audit reports performed by the Contractor reflected in the audit programme

To conduct independent quality audits during all phases of the contract and the contractor shall provide all resources to support these activities.

Eskom shall have the right to participate or request for a technical investigation to be launched and conducted on the Contractor and subcontractors premises or other sites, when risk to Eskom products or service deliverables are identified.

To participate in and/or lead investigations related to incidents involving its products. To require from contractors to be responsible for the cost of re-inspections To withhold payment from Contractors as a result of outstanding non-conformances irrespective

of the agreed payment schedule and in accordance with the conditions of contract. Shall be granted electronic and hard copy access to all quality plans, procedures, documentation,

and other quality records relating to the Work including but not limited to data extracts.





Reserves the right to review, inspect and audit any or all parts of the Contractor QMS as well as any documentation, materials or equipment associated with the Work, at any time or Project Work location.

Shall carry out assessments and audits on all new Contractors and subcontractors Reserves the right to appoint resident quality inspectors that can be based at the Contractor

or subcontractors premises and on site where the work is being performed. Reserves the right to select witness and hold points within all developed Supplier QCP/ITPs for

Eskom oversight of selected functions and to perform surveillance or audits of the Work. Shall be given access at all reasonable times before, during and after manufacture and before

delivery, construction, erection, commissioning to measure, test and inspect the products and workmanship as necessary on the Contractors premises and on Eskom sites.

Reserves the right to suspend any pending deliveries, by the issuing of a cease delivery order at any time and for any portion of the work that is not being performed in accordance with the specified/agreed requirements.

To expect the Contractor to use Eskoms electronic system for the automation and management of quality and other relevant aspects of the project (Achiever Plus).

3.1 GENERAL REQUIREMENTS

3.1.1 QUALITY MANAGEMENT POLICY

Contractor Quality Management Program shall be based upon a Quality Management Policy and a series of Quality Objectives and a Project Quality Organizational Structure. Contractor Quality Management Policy shall be based on the following Quality Management principles:

Meeting Customer expectations Leadership Involvement of people Process approach System approach to management Continual improvement Factual approach to decision making Mutually beneficial Project - Supplier relationships

Contractor shall ensure efficient and effective communication of Project Quality Policy and Objectives to Contractor and subcontractor organizations. Communication of and discussion around project Quality Policy and Objectives shall be conducted at a frequency supportive of project management commitment to workforce engagement and continual improvement Contractor Project Quality Management System (QMS) is the system of processes by which Contractor will provide Eskom with assurance that Contractor Work deliverables are in conformance with Contract specifications

3.1.2 IMPLEMENTATION

Contractor QMS shall support Eskom and Contractor Project Management Objectives for safe, efficient and effective implementation of all Work processes and procedures.





Contractor CQP shall be implemented through utilization of a comprehensive QMS. The QMS shall incorporate Quality management processes and procedures tailored to support Project Quality Policy, Goals and Objectives in all Work functional areas and for all Work deliverables. Project Work functional areas include Engineering, Procurement, Project Controls, Logistics, Materials, Fabrication, Transportation, Preservation, Construction/Erection, Commissioning, Quality, HES, Security, Informational Management and other functional areas under Contractor Work scope.

The Contractor shall follow a graded approach and establish critical products and services, endorsed by Eskom. Contractors, subcontractors and all other suppliers of such products and services shall ensure compliance with QMS performance expectations. Eskoms position is to contract with Contractors who fully demonstrate commitment to the development, implementation and maintenance of a Quality Management System that conforms to the requirements of ISO 9001:2008 (or latest applicable revision). or equivalent. The priority is to encourage Contractors to continually improve their quality management system and enhance service delivery by obtaining ISO 9001:2008 (or latest applicable revision). compliance and certification.

It is the Contractors obligation to ensure that their operations and the products and services it provides to Eskom comply with any applicable statutes and or regulations. Any non-compliance by the Contractor and the resultant corrective actions shall be the responsibility of the Contractor.

The Contractor shall ensure that he complies with the works information and that appropriate quality requirements (as in the main contract) are included in subcontracts placed by Contractors to ensure subcontractors compliance with the Works Information.

3.1.3 QUALITY MANAGEMENT IN ENGINEERING

3.1.3.1 Design Quality Plan

Contractor shall develop and implement an Engineering Design Quality Plan incorporating all processes, procedures and supporting documents required to assure delivery of Engineering Work scope deliverables in FEED, Detailed Design, Fabrication and Construction and commissioning. Contractor Engineering Design Quality Plan shall obtain a minimum of DRC2 status and ready for implementation within thirty (30) days of the date of Contract award. However, all documents must obtain the DRC1 status prior to distribution for use.

3.1.3.2 Design Planning and Control

Planning, control, and verification of design activities shall be achieved by Contractor through use of documented processes and procedures that describe the organizational and technical interfaces and that define the necessary information to be documented, transmitted and reviewed as per the process defined in Document Control and Exchange Specification. The Contractor shall:

submit for Eskom review documented processes for the execution of the Engineering Work scope including but not limited to the sequencing of Work

develop a list of Engineering deliverables and an Engineering Deliverables Responsibility Matrix. Provide to Eskom within thirty (30) days following contract award the Engineering deliverables

and Engineering Deliverables Responsibility Matrix as per the process defined in Document Control and Exchange Specification.

The Contractor shall further ensure that:





Engineering deliverables and the Engineering deliverables responsibility matrix shall obtain a minimum of DRC2 status and a DRC1 prior to distribution for use. Matrix should describe the internal approval cycle for the Contractor.

Engineering Design Quality Plan processes shall define work processes including use of design software, alternative calculation requirements, and responsibilities for design activities for each Engineering discipline engaged in the design Work scope.

Organizational and technical design interfaces shall be identified and shall be controlled by engineering work processes including assignment of personnel with appropriate authority to assure coordination between Eskom, Contractor, subcontractors and Suppliers.

Engineering Design Quality Plan processes shall provide for Contractor discipline subject matter expert systematic and controlled review of all design activities (e.g. establishing Basis of Design (BOD) requirements, reviewing design inputs, approving design outputs, etc.). Contractor discipline subject matter expert review and approval shall be documented prior to submittal of engineering deliverables for Eskom review.

3.1.3.3 Design Quality Planning

The Contractor shall: prepare an Engineering Design Quality Plan or equivalent listing all Quality-affecting activities

and deliverables to be performed by each engineering discipline. Design documents including specifications, data and other information contained in the Work scope shall form the basis for design planning.

utilize detailed review of the Work scope to determine deliverables, including deliverable Quality activities, and delivery schedules represented in the Engineering Design Quality Plan. Based on the activities identified, each engineering discipline shall identify, in a discipline specific plan, the processes, procedures and work instructions to be followed to execute the discipline assigned Work scope.

ensure that suitably qualified and experienced design engineers are assigned to perform designated work. Contractor Engineering Design Quality Plan shall specify the position identity, responsibility, and authority levels of engineering discipline team members to whom elements of project engineering Work scope execution will be assigned.

The Contractor Engineering Design Quality Plan shall: document the basis for checking deliverables and shall incorporate reference checklists and other

tools to be used for deliverables review. document verification activities, such as inter-discipline squad checks and formal design review

requirements. specify the engineering discipline or other technically qualified manager responsible for

verification that engineering discipline specific design plans are consistent with project Work scope and are executed.

incorporate a design review and verification process to assure alignment between project functional areas external to Engineering.

Plans, processes and procedures for management and control of project-related computer hardware and software shall be described in Contractor Automation Plan. All computer software deployed in support of Contractor design activities shall be systematically verified by Contractor in accordance with ISO 90003, Software Engineering Guidelines for the Application of ISO 9001 prior to deployment to demonstrate fitness for purpose.





Contractor Automation Plan shall receive DRC 1 status prior to implementation.

3.1.3.4 Criticality Assessment and Application

Contractor shall: Utilize Quality Assurance and Quality Control activities (e.g. audits, assessments, verification and

testing processes and procedures) commensurate with assessment of Criticality. The level of Supplier verification and oversight by the Eskom and/or Contractor is driven by criticality rating that each item or piece of equipment receives.

Assess Criticality in compliance with Eskom Criticality Rating Program and shall obtain a DRC 1 status for Contractor criticality rating processes and process deliverables.

Utilize Criticality Process outputs in planning for and execution of verification of engineering, design, procurement, construction, installation, hook-up and commissioning activities.

Obtain DRC 1 status for verification plans. Ensure Criticality Ratings have been defined prior to issuing the first RFQ Incorporate criticality process outputs into Contractor Engineering Design Quality Plan. The criticality rating process should be used as a tool to reach an action plan that minimizes risk

to Eskom. The initial criticality rating may be amended (over-ridden) to a higher Criticality Rating during the Supplier selection process based on their known current historical experience and previous knowledge of the applicable potential Supplier and/or Sub-Supplier.

Contractor criticality process outputs shall be considered a key determinant in development of Quality audit and surveillance schedules and in development of Quality Control Inspection and Test Plans.

Eskom reserves the right to provide criticality rating for any or all Work scope deliverables. The criticality rating system applied shall be commensurate with the following Eskom

classification of parts system described as follows: Classification of Parts

Class-1 (Vital). Those parts that (1) have no redundancy and (2) are subjected to significant fatigue loads, failure of which could cause a catastrophic effect to/loss of equipment and/or life.

Class-2 (Critical). Parts, the failure of which could lead to one or more of (1) structural collapse, (2) a reduction or loss of functional capabilities, (3) unintentional operation or system/equipment shutdown essential to the safe functioning of the equipment and/or (4) injury to personnel. (Immediate action: system shut-down.)

Class-3 (Significant). Those parts (1) falling within Class-1 or 2, but with such high safety margin that the probability of failure is so rare that it can be demonstrated only by analysis, or (2) parts not within Class-1 or 2, but (a) the failure of which will cause problems w.r.t. efficiency, or (b) the design philosophy and/or materials used in the manufacturing process are so new that particular qualification tests are required to demonstrate their reliability.

Class-4 (Non-Significant). All parts not covered by Class-1, 2 or 3.





NOTE 1: Class-1 parts must be uniquely identified by a S/N, Class-2 parts should be serialised, Class-3 parts do not normally require serialisation but may be identified by a S/N, Class-4 parts do not require serialisation.

NOTE 2: Installations cannot be classified as vital. However, if a faulty component could cause the loss of the equipment/life, this means that it contains a potentially vital characteristic and an independent double check requirement (i.e. "dual inspection") must be identified.

3.1.3.5 Design Inputs

Contractor Engineering Design Quality Plan shall: Include processes and procedures to assure applicable design input requirements, including

latest local, state, national and international regulations, and applicable industry codes and standards are identified, documented and reviewed for adequacy. Incomplete, ambiguous or conflicting requirements shall be identified and referred to the appropriate authority for resolution.

Include processes and procedures to assure interfaces are reviewed for effectiveness in sharing of information and in communication of design input detail, timing and quality of information needs. Disciplines shall include both internal and external interfaces.

3.1.3.6 Design Outputs

Project design requirements shall be translated into specifications, drawings, data sheets, instructions, etc., (referred to collectively as design documents) as necessary to enable subsequent detail design, manufacture, installation and operation to be performed in accordance with Work specifications. Contractor Engineering Design Quality Plan shall include processes and procedures to assure interfaces are reviewed for effectiveness in sharing of information and in communication of design output detail, timing and quality of information needs. Disciplines shall include both internal and external interfaces. Contractor shall include design output milestones, solicitation of key internal and external end-user/customer comments, requests for clarification and requirements for design outputs. Design output shall be prepared and maintained in a readily accessible format in accordance with Work specifications. Request by Contractor or by Eskom for revision of design output format shall be subject to formal review by Contractor and by Eskom project management. Authorization to proceed by Eskom shall be required prior to execution of any request for generation of design output in a format not provided for in the Work scope.

3.1.3.7 Design Verification

Contractor shall document processes for design verification including, but not limited to: Check and approval of all design documents by suitably qualified and authorized personnel prior

to release for use Levels of competency of engineering personnel having checking and approval authority. Conducting technical audits/internal assessments. Where required, witnessing of verification activities by specialist engineers or an authorized third

party in accordance with Contract, engineering code or specification or regulation. Contractor Engineering Design Verification process shall include procedures for formal review and approval of all design documents by suitably qualified and authorized personnel prior to design document release for use.





3.1.3.8 Inter-discipline Check and Review (Squad Check) Contractor shall designate a Lead Discipline Engineer for each engineering discipline. Contractor Lead Discipline Engineer shall be responsible for verification that interdisciplinary checks and reviews required by the applicable discipline Engineering Design Quality Plan are performed by all affected internal and external interfacing disciplines including Eskom. The issuing discipline will examine all comments received and incorporate them into an updated design or other project document as appropriate. If the issuing discipline disagrees with any comments, the issue will be discussed with the reviewer (discipline organization) concerned until agreement on resolution is reached. No further work may be performed on the disputed activity until satisfactory resolution has been achieved. Responsibility for filing the original check prints or equivalent on which comments are recorded, including documentation of issue resolution, will reside with the issuing Contractor Lead Discipline Engineer. Each issuing discipline will maintain a file of inter-discipline review records where all comment copies are maintained for the duration of the Project.

3.1.3.9 Design Validation (Including Software Validation) Contractor shall develop and implement an Engineering Design Validation process. Contractor Engineering Design Validation process shall:

provide for a documented, comprehensive, and systematic examination of design elements serving to establish the extent to which Work scope deliverables have achieved compliance with Project requirements.

incorporate but is not limited to design review, performance (simulation) testing, alternative calculation methodologies, mechanical completion checks, commissioning and ready for start-up testing.

include procedures for establishing qualification and competency of engineering personnel assigned design development, design review and design approval authority.

include procedures for conducting discipline technical audits and internal Quality assessments as work progresses toward identified schedule milestones.

include procedures providing for witnessing of verification activities by specialist engineers or by an authorized third party in accordance with engineering code, project specification or regulatory requirement.

Contractor Design Validation process and any performance (simulation) testing proposals shall obtain DRC 1 status prior to implementation. Contractor shall ensure performance (simulation) tests are witnessed by Contractor qualified specialist engineers and shall provide a minimum of fourteen (14) days notice of proposed performance (simulation) testing to facilitate observation by Eskom. Contractor shall employ performance verified and validated computer software during design activities. New computer software deployed in support of Contractor design activities shall be systematically verified in accordance with ISO 90003, Software Engineering Guidelines for the Application of ISO 9001 prior to deployment to demonstrate fitness for purpose.

3.1.3.10 Design Changes

Contractor shall: control all design changes and maintain a Design Change Log. All design changes and

supporting documents shall be subject to review by Eskom. Changes to Eskom approved





preliminary design will be controlled, reviewed, and approved in the manner, and as far as practical, by the Engineering team members responsible for the original design.

obtain written Eskom approval for post-design freeze design changes. Supply risk assessment data with request prepare a formal, written statement of rationale accompanied by a report detailing engineering,

operational, construction, health, environment, safety, and other relevant discipline considerations for any post design freeze design change request.

ensure that any proposed design change is evaluated for adequacy, safety, conformance with specifications, suitability to fulfil the purpose for which it is proposed and for cost and schedule impact.

obtain Eskom Approval prior to commencement of detailed design change. develop and efficiently and effectively implement a post-design freeze Design Management of

Change (MOC) process for any Eskom approved detailed design change. Contractor Design MOC process shall incorporate validation of efficient and effective use of Engineering and other discipline design processes and in particular shall ensure utilization of Contractor inter-discipline check and review processes.

include in its processes for control of detailed design changes, a Process Safety Management of Change Procedure to identify and review changes that occur on documents used for the Design Hazard Review. The procedures shall be applicable to any changes in these documents through turnover. Changes to documents used in process hazard analysis shall be controlled using appropriate Eskom and/or national and international standards as a guideline e.g.US OSHA 1910.119.

All design changes shall be reviewed by the responsible discipline team member and approved by Contractor discipline lead engineer and all other discipline leads that are impacted by the change. Revised sections of design documents shall be marked and numbered for easy and quick identification. A Detailed description of design changes shall be logged and recorded on the revised drawing or other design document prior to submittal for Eskom review. On achieving approval of the change, revised documents shall be re-issued in accordance with Contractor document distribution and control procedures and DRC1 status achieved prior to implementation. Records of changes shall be kept for the prescribed contract period agreed by all parties.

3.1.3.11 System and Sub-System Lists

Contractor shall complete System and Sub-System Lists during FEED, Detailed Design and prior to issuance of work authorization for Fabrication and Construction. Identification of System and Sub-System and associated Quality verification documents shall be prepared prior to initial stages of construction to facilitate development and implementation of Construction Contractor tracking systems. During Construction, Identification of System and Sub-System Lists shall serve as the basis for tracking, completing and compiling construction Quality verification documentation. Identification of System and Sub-System Lists, and their Eskom Quality verification documents, shall be developed and maintained in a format suitable for ease of incorporation into handover to operations Systems Dossiers.

3.1.3.12 Design Element Identification, Traceability, and Composition Verification

Contractor engineering design procedures shall include provision for unambiguous identification of design elements including but not limited to materials, systems, equipment and other components. Contractor shall comply with Eskom specification regarding traceability and Positive Material Identification (PMI) for design elements identified as subject to Eskom requirements.





Design elements identified for enhanced control, e.g. (Criticality 1, 2 and as required 3) systems or system elements, shall be managed under Contractor product identification and traceability program from completion of detailed design through all subsequent Project phases, including handover to operations. Contractor engineering shall ensure efficient and effective communication of design element components subject to enhanced control through positive identification and traceability procedures to project Procurement and Quality.

3.1.3.13 Design, Safety and Model Reviews.

Contractor shall: document processes for conducting design, safety and model reviews. These processes shall

receive DRC1 status prior to implementation. Design and safety reviews shall include a process hazards analysis using appropriate Eskom and/or national and international standards as a guideline e.g.US OSHA 1910.119. Design, safety and model reviews shall be planned, formal meetings during which an appropriately qualified multi-discipline team examines aspects of the design. The reviews shall at minimum consider compliance with Eskom Safety in Design standard and Eskom Operations Assurance Process requirements. Contractor process document shall provide for and describe Eskom role in design, safety and model reviews.

provide Eskom a minimum fourteen (14) day notice of design, safety and model reviews to allow for appropriate Eskom personnel representation. Design, safety and model Review timing shall be reflected in the project schedule.

3.1.3.14 Constructability Maintainability, Operability Reviews

Contractor shall: document processes for implementation of constructability maintainability, operability reviews

which include consideration for working at heights, safety in design, and other hazardous work conditions. These reviews shall be planned, formal meetings during which an appropriately qualified multi-discipline team examines aspects of constructability, maintainability and operability.

provide Eskom a minimum fourteen (14) day notice of such reviews to allow for appropriate Eskom personnel representation. The timing of constructability, maintainability, operability reviews shall be reflected in the project schedule

document outputs from reviews and make these available to Eskom on request.

3.1.4 QUALITY MANAGEMENT IN FABRICATION & CONSTRUCTION

3.1.4.1 General

Contractor fabrication, construction and completions Quality Management organization shall be independent from those performing the Work.

Fabrication, construction and completions Quality Management organization chart shall clearly illustrate reporting relationship between Contractor fabrication and construction site project Quality Management organizations and Contractor home office Quality Management organization.





Contractor shall document and make available for Eskom review a comprehensive fabrication, construction and completions Quality Management Plan (CFCCQMP). CFCCQMP shall include all Quality Management plans, processes, procedures and methods.

CFCCQMP and organization structure, including a bar chart representation of the schedule proposed for personnel mobilization, shall be submitted for Eskom review not later than sixty (60) days prior to start of Work at any Fabrication or Construction site. Such mobilization shall be in compliance with Project Quality Personnel Qualification Specification.

CFCCQMP, Quality Management organization structure and mobilization schedule shall obtain DRC 1 or 2 statuses prior to implementation.

CFCCQMP shall ensure Fabrication and Construction Quality Management requirements for Work scope systems, system components, equipment, materials and other procured goods are clearly and unambiguously documented, and are efficiently and effectively communicated to Project Procurement, Logistics, Construction Management, Quality, Security and other Project functional areas (as required for efficient and effective support of Fabrication and Construction Work scope).

All applicable codes, standards, and relevant acceptance criteria documents are available at the work location and that Eskom representatives on site shall have on going access to this information. Workplace documentation shall be available in English and in any workforce appropriate language.

Contractor fabrication, construction and completions Management shall develop and implement a process for efficient and effective communication to Project Engineering, Security, Procurement, Logistics and other Project functional areas regarding environmental, workforce, community, government or other challenges, threats or factors which impose a need for change in Fabrication or Construction site management process or procedure.

Key characteristic Manufacturing processes can be improved through adequate planning and effective management of key characteristic variation. The key characteristics focus is intended to improve confidence for part features whose variation has a significant influence on end-products form, fit, performance, service life and manufacturability.

What is a Key Characteristic? For a part, subassembly or system, it is defined as selected geometrical, material properties, functional and/or cosmetic features, which are measurable, whose variation control is necessary in meeting customer requirements and enhancing customer satisfaction. Key characteristics are also selected measurable parameters of a process whose control is essential to manage variation of part or system key characteristics.

How are Key Characteristics defined? The key characteristics owner normally defines them. The owner is either a person or function that recognizes the reasons for selection of the key characteristic. Typically, these responsibilities are held by internal or external design, quality or manufacturing engineering, and should be identified by a cross-functional team.

Key characteristics shall be defined, by the OEMs and at the discretion of Eskom, to direct Quality Control efforts.





3.1.4.2 Quality Audits and Related Quality Performance Reviews

Quality Audits and related Quality performance reviews are intended to provide an objective evaluation of compliance with performance expectations defined in this specification, in Contractor CQP and in any other project Work scope specification.

Quality Audits and related Quality performance reviews include but are not limited to any Quality or other project functional area audits, assessments, verification of compliance reviews, surveillance, inspections, or other interim or final assessments of Work scope deliverables provided by Contractor, subcontractors or Suppliers.

Quality Audits and related Quality performance reviews shall be carried out by trained, accredited and experienced personnel in accordance with procedures documented in the CQP.

Contractor shall submit for Eskom review documented processes for conducting project Work scope Quality Audits and related Quality performance reviews. Contractor Quality Audits and related Quality performance review processes shall be designed to address evaluation of progress toward completion of project functional area deliverables as well as final deliverable quality.

Contractor shall provide a schedule of anticipated Quality Audits covering all functional areas and related Quality performance reviews at the time of first post-contract award CQP submittal.

Contractor shall maintain an accurate Quality Audit and related Quality performance review schedule and shall incorporate the current schedule as an attachment to the Contractor CQP.

Contractor Quality Audit and related Quality performance review schedule development process shall be designed to incorporate consideration of information generated by previously conducted audits and reviews, by input from project risk management evaluations (Risk Register) or from Eskom, Contractor, or subcontractor subject matter expertise

Eskom reserve the right to oversee Contractor audit programs by participating in selected audits as an observer, and by assessing Contractor at key work stages. Eskom will coordinate with Contractor to develop an oversight schedule aligned with Contractor audit schedule.

Eskom will have right to obtain access to any audit reports performed by the Contractor reflected in the audit programme

Eskom reserves the right to conduct independent Quality Audits scheduled and unscheduled - during all phases of the Contract. Contractor shall provide all resources to support these activities.

Eskom shall be given access at all reasonable times before, during and after manufacture and before delivery, construction, erection, commissioning to measure, test and inspect the products and workmanship as necessary on the Contractors premises and on Eskom sites.

The Contractor shall obtain access for Eskom to measure; test, witness tests, and inspects products which are being manufactured by any subcontractor. This includes surveillances.

Assessments and audits shall be carried out on all new Contractors and its subcontractors. Eskom shall have the right to participate or request for a technical investigation to be launched

and conducted on the Contractor and subcontractors premises or other sites, when risk to Eskom products or service deliverables are identified.

Qualification requirements for Contractor and subcontractor personnel engaged in conducting Quality Audits and related Quality performance reviews shall be defined in the Contractor CQP and shall be in compliance with Project Quality Personnel Qualification Specification.





3.1.4.3 Eskom Right of Access

Eskom: shall be granted electronic and hard copy access to all quality plans, procedures, documentation,

and other quality records relating to the Work including but not limited to data extracts. reserves the right to review, inspect and audit any or all parts of the Contractor QMS as well as

any documentation, materials or equipment associated with the Work, at any time or Project Work location.

shall carry out assessments and audits on all new Contractors and subcontractors Contractor:

Shall support Eskom effort to monitor, verify and/or witness any activities associated with the Work at any time.

Shall cooperate with Eskom requests for documentation, records, and inspection and witnessing. Eskom participation in audits, appraisals, assessment of plan and verification shall be conducted at no extra cost to Eskom

Shall ensure supplier provides access to Eskom to all Work procedures, quality records, and to all supporting documentation through provision of access to view and photocopy as required to support verification of Work scope requirements. Access shall include the ability to photograph Eskom equipment, systems, system components, materials, etc.

Provide access to all Quality related information pertaining to activities performed by itself or subcontractors, which Eskom might not have participated in the witnessing of quality assurance or control thereof (this refers to inspections, audits, etc., performed by the Contractor on its own subcontractors)

Eskom shall be allowed to assess, audit, approve or reject any sub-contractors employed by Eskom's Contractors/Suppliers to assist with the product and/or service delivery to Eskom.

Shall ensure above requirements are flowed down to subcontractors

3.2 TENDER SUBMISSION PHASE

3.2.1 Contractor documents with the tender

The Contractor shall submit the following documents with the tender: (All documentation submitted shall be in English).

a1] The Contractor shall complete and sign Form A (Enquiry/Contract/Quality Requirements) a2] The Contractor shall complete and sign Form B (Quality Requirements for Quality Management

ISO series) a3] The Contractor shall attach the following: a4] A copy of the CV/Resume of the Contractors quality management representative a5] The Contractor shall attach a copy of ISO 9001:2008 (or latest applicable revision). certificate

or objective evidence (e.g. copy of a compliance audit report) of a QMS that complies with ISO 9001:2008(or latest applicable revision).

a6] The Contractor shall attach a copy of the latest structure/organogram of the quality function/ department, including an abridged indication of qualifications of personnel. This structure





shall indicate to whom the organizations quality management representative reports in the organization

a7] Information on similar work performed (at most within the last two years) a8] Sample CQP (including a QCP and ITP) from a similar project carried out within the last two

years. a9] A sample Non-conformance report shall be attached to tender a10] A sample of a corrective and preventive action report shall be attached to tender a11] A sample of an audit schedule and report on a sub-Contractor a12] A detailed description of the process and procedure for the evaluation, selection and control of

suppliers and subcontractors shall be attached to the tender a13] Any quality management accreditations (NDT/ NDE/ Welding) and special processes requiring

certification a14] List of long lead items a15] Preliminary manufacturing schedules a16] Preliminary risk assessment data a17] Preliminary list of critical characteristics

3.2.2 The Contractor shall submit a draft Contract Quality Plan (CQP) with the tender. The CQP shall contain the following information (Refer Annexure C):

b1] A cover page containing the following information: a. The draft contract title b. The Eskom tender number c. The draft contract commencement and completion dates d. The names, designations, signatures, of personnel responsible for preparing and

approving CQP e. Provision for Eskom acceptance of CQP f. An index of contents g. A full description of the Works Information h. A description of the communication channels between the Contractor and Eskom

regarding all quality related issues (fixed contract meetings) i. An organogram showing the structure of the Contractor, which shall show the quality

management representative, and all other personnel responsible for control of quality activities/processes

j. An index of all the interfacing documents between the Contractor and Eskom k. A schedule (Index) of documents / records that shall be:

i. Submitted to Eskom during the contract ii. Captured on the Contractors QMS iii. Submitted to Eskom prior to the completion of the works/contract iv. A list of all sub-Contractors that shall be utilized during the contract.





l. This list shall indicate: i. the scope of supply of product and or service, ii. a method of acceptance of these sub-Contractors by Eskom shall be indicated iii. An indication of how the sub-Contractors shall be controlled and monitored during

contract execution iv. Objective evidence that Contractors sub-Contractors will work to the specified

quality standard v. An index of products that shall be:

a. Manufactured by Contractor /subcontractor b. Refurbished by Contractor /subcontractor c. Purchased as a new product

vi. A list of products/processes for which QCPs, ITPs WILL BE and WILL NOT BE prepared

vii. A list of products/processes/services that require special controls (e.g. welding, NDT/NDE)

viii. A description of the interface of the sub-Contractors and Contractors/suppliers QMS and applicable documents, procedures and work instructions

ix. An index of all standards, specifications for all processes, products, materials and plant applicable to the works/contract

x. A description of how all quality records shall be controlled (e.g. identified, completed, retained and disposition)

xi. A list of purchase orders for quality critical products showing purchase order number and scope of supply

xii. Application for defects acceptance (concessions) registers to be updated during the Contract.

xiii. A typical copy of the suppliers/ Contractors concession request register which shall be updated during the project/contract

xiv. Databook index and O&M Manual xv. Spare parts inter-changeability records

3.3 TENDER EVALUATION, ADJUDICATION AND NEGOTIATION PHASE

a) Eskom shall carry out a full technical and QMS assessment on a Contractor. b) Eskom shall carry out an evaluation of quality documentation submitted with each tender. c) Eskom shall have the authority and right to assess all of the Contractors subcontractors

before Contract award and to reject any that do not meet its requirements.

3.3.1 Subcontracting

a) Submission of subcontractors contract administration plan (CAP). The Contractor shall compile and submit a contract administration plan for Eskoms acceptance. The CAP must contain the following:





- a full schedule of subcontractors to be used during the lifecycle of the project. Such schedule shall include past performance of subcontractors as well as capabilities matrix

- the portion of the works information or volume of work to be subcontracted to each subcontractors with monetary value

- a schedule indicating how subcontractors were or will be pre-qualified, - the form of contract that will govern and regulate relationships between the main

Contractor and all subcontractors including term and conditions of contract - subcontractors performance monitoring and control strategies - a risk register listing all foreseeable contractual risks associated with the usage of

subcontractors, sub consultants and suppliers with relevant and applicable risk management strategy.

All risks/foreseeable risks must be listed under contract data provided by the Contractor. Risks to be carried by the main Contractor shall be separated from those to be carried by subcontractors

The risk management strategy must be aligned to actual costs and percentages stated in the schedule of costs components

- subcontractors respective high level programmes including subcontractors execution statements and respective interfaces

- subcontractors schedule of insurances - a contract communication plan whenever there is deviation from the communication

plan presented by Eskom and/or the NEC applicable contract - a guaranteed performance. This refers to the quality and conditions in which the works

will be upon completion and hand over to Eskom - subcontractors payment schedule processes - subcontractors change management processes - termination processes

b) Pre-qualification of subcontractors by the Contractor the Contractor shall pre-qualify all subcontractors in respect of overall competence and

capability and quality management system, by mean of a formal audit or assessment. All subcontractors shall comply with the requirements of ISO 9001:2008 (or latest applicable revision).or equivalent

c) Supplier and subcontractor Qualification and Selection Contractor shall develop and execute an effective and efficient program to ensure Project

Supplier and subcontractor qualification is conducted in compliance with Eskom Project Supplier Qualification Program.

Eskom shall be allowed to assess, audit, approve or reject any sub-contractors employed by Eskom's Contractors/Suppliers to assist with the product and/or service delivery to Eskom.

Contractors/Suppliers shall unambiguously acknowledge that Eskoms acceptance of the quality credentials of sub-contractors does not relieve the Contractors/Suppliers from any of their contractual and regulatory obligations. The Contractors/Suppliers remains fully responsible for compliance with all the provisions of the contract and furnishing products/services





which meet all applicable requirements of the contract, whether such products are manufactured, processed, provided or procured by the Contractors/Suppliers for the contract.

Contractor shall source all services, materials, supplies, equipment, systems, system components, etc. from firms identified in Eskom Approved Vendors List (AVL). Should Contractor identify the need for sourcing from a firm or firms not currently included in Eskom AVL, Contractor shall notify Eskom in accordance with process defined in Project Supplier Qualification Program (Contractor Request)

Use of services, materials, supplies, equipment, systems, system components, etc. from unlisted sources prior to receiving Eskom approval shall be subject to immediate incident investigation to determine the origin and nature of deviation from procedure and system requirements. Proposed incident corrective action shall be submitted to Eskom for approval. Repair and or replacement expense shall be assigned to Contractor account.

Where corrective action includes independent testing, such testing may include: mechanical testing (tensile strength, elongation, charpy, etc.), chemical composition (wet chemical analysis), and any other supplemental testing required by the original material specification or Project requirements. Contractor shall be responsible for the cost of additional testing regardless of test results. Should Eskom elect to deny use of the material, all replacement material shall be furnished at Contractor cost.

d) Management of subcontractors during project execution phase the Contractor shall submit the names of all proposed and qualified subcontractors for approval

by the Project Manager. The Contractor doesnt appoint a subcontractor or make use of his services or allow him to

access site without prior written consent / acceptance of Eskom. the subcontractor and the conditions and terms governing the contractual relationship between

the Contractor and subcontractors must also be presented to the Eskom for acceptance the Contractor and all his subcontractors shall acts in accordance with the health and safety

requirements as stated in the works information The Contractor shall, for the duration of the contract, maintain a list of approved

subcontractors including the scope of supply for which they are approved. The Contractor shall at all times ensure that the following particulars in respect of all its

subcontractors are submitted to Eskom, within 4 weeks of contract placement. The Eskom reserves the right to satisfy itself on the validity thereof:

Name and Address; Portion of the Works Information to be subcontracted; subcontractors QMS and certificate number (if certified) or audit report number (if not certified); Current scope of supply as recorded on their ISO 9001:2008 certificate; or other proof Previous experience in supplying identical or similar work; Approved by Contractor: Yes/No; Date of Approval. The Contractor shall not replace a subcontractor without informing Eskom Changes of subcontractors or their details must be communicated to Eskom prior to execution





3.4 CONTRACT AWARD PHASE

a) Access to premises, facilities, documentation and information: i. Eskom or its inspection agency shall be afforded access to all areas of the

Contractors and Subcontractors premises and facilities, to conduct quality audits, surveillance, investigations, expediting and inspections to verify compliance with the agreed requirements.

ii. Eskom reserves the right to participate in incident investigations if the quality and / or technical characteristics of product and/or services to Eskom are affected, irrespective of whether the incident occurred on an Eskom site or the contractors premises.

iii. All quality system documentation, records, reports, etc., shall be made available for review when requested by Eskom or its appointed inspection agency. The Contractor shall give written permission to its product and quality management system certification bodies, and/or any inspection/testing authority acting on its behalf, to make available all information at its disposal, and without any reservation, for review by Eskom, or by its appointed inspection agency

iv. The Contractor shall provide suitable facilities to Eskom or its appointed inspection agency, and shall supply any assistance necessary for the performance of any audit, surveillance, assessment and/or inspection activities to be conducted by Eskom

v. The Contractor shall provide timely notification to Eskom of changes to any agreed-upon request for inspection

vi. The Contractor shall ensure a safe working environment for Eskom or its appointed inspection agency, by informing it of the necessary safety requirements and possible safety hazards

b) Eskom non-conformance & inspection defect/reject reports: i. Non-conformance reports raised by Eskom and issued against the Contractor shall

be investigated by the Contractor as a matter of urgency, in order to determine the root cause, corrective action and preventive measures as required, with the implementation time-frames. Initial response within 3 working days.

ii. A formal response shall be prepared in respect of the defined criteria, and submitted to Eskom for its review, evaluation and acceptance, within a maximum of fourteen (14) calendar days from the date of issue of the non-conformance report see note at bottom of page on hard copy

iii. Eskom may at its discretion request a response sooner, and in any case before the supplier proceeds with any pending/further intervention or corrective action as may be required by Eskom.

iv. Should Eskom or its inspection authority/agency identify any non-conforming products/service during the conduct of its audits/surveillances/inspections, the supplier shall be deemed to be in breach of contract, and shall be held liable for any repair, rework and/or associated replacement costs. The Contractor may in such instances also be held liable for the full costs associated with the conduct of follow-up audits/surveillances/inspections

v. The nature, magnitude and/or frequency of non-conformance or inspection defect/rejection reports raised by Eskom or its appointed inspection authority/agency, shall form the basis of any action to rescind the suppliers qualification status.





3.5 CONTRACT AWARD AND QUALITY CONTROL PHASE

3.5.1 Pre-contract execution

3.5.1.1 Supplier and subcontractor Quality Management Plan

Contractor shall require Suppliers and subcontractors to submit project Quality plans and associated documentation in accordance with requirements of Project Quality Management System processes applicable to subcontractor or Supplier Work scope. Contractor shall, where applicable based on Work scope Criticality, ensure Procurement documents clearly and unambiguously require Supplier and subcontractor submission of a Supplier or subcontractor CQP for Contractor and Eskom review. Supplier or subcontractor CQP shall achieve DRC 1 status prior to implementation. Contractor shall ensure Supplier or subcont

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