State of Israel

Ministry of Energy and Water

Natural Gas Authority

Distribution System Directive (DSD)

August / 2010

Prepared for
Natural Gas Authority
Qiryat Hamada 6
POB 45140
Jerusalem 90451

Prepared by
Parsons Brinckerhoff
Beit Bareket 1
Airport City
POB 1032
Airport City 70100
Israel
www.pbworld.com
Revision # Date Reason for change
0 1.2.09 Initial draft
1 2.3.09 Review with comments
2 22.3.09 Review with comments
3 6.4.09 Submitted to NGA
4 19.11.09 Submitted to NGA
5 31.03.10 Delete all statutorical issues PB Ref DCN 30875
6 8.8.10 Add'l comments to section 6 PB Ref DCN 31784

II
 Table of Contents

Table Of Contents .................................................................................................................... 3

Abbreviation List ...................................................................................................................... 5

SECTION1.0 GENERAL........................................................................................................... 6

SECTION 2.0 DESIGN OF THE SYSTEM ............................................................................ 9

2.1 Schedule 9
2.2 Detailed Design 9
2.3 Provision of the Package 12
2.4 The NGA Review Process 12

SECTION 3.0 PROCUREMENT ............................................................................................. 14

3.1 Manufacturing of the System 14

3.2 Lawful code 14
3.3 Certificates 14
3.4 Traceability 14
3.5 Material Specification 15

SECTION 4.0 CONSTRUCTION ............................................................................................. 17

4.1 Construction of the system 17

4.2 NGA Supervision 20
4.3 Notification to the NGA 20
4.4 Testing and Commissioning 20
4.4 Testing and Commissioning 21

SECTION 5.0 REQUEST FOR GASSING UP .................................................................. 23

5.1 Request Requirements 23

5.2 NGA Review 24
5.3 Provision of Gassing up permit 24

SECTION 6.0 OPERATIONS AND EMERGENCY .......................................................... 25

6.1 Procedure Details 25

6.2 Construction Completion Certificate 26
6.3 System Completion Approval 28

SECTION 7.0 PROVISION OF AS BUILT DOCUMENTATION ........................................ 30

SECTION 8.0 FINAL COMPLETION APPROVAL ............................................................. 31

SECTION 9.0 HEALTH SAFETY AND ENVIRONMENT PLAN ....................................... 32

9.1 General safety 32

9.2 Adherence to Procedures 32
9.3 HSE Objectives 32
 9.4Training and Material Maintenance 33
9.5 Safety Management System 33
9.6 Items to be Addressed in HSE Procedures 34
9.7 Environmental Responsibility 35
9.8 Incident reporting 35
9.9 Hazard Identification Study (HAZID)III 35

SECTION 10.0 QA/QC SYSTEM QUALITY ASSURANCE AND CONTROL PLAN ...... 37

SECTION 11.0 INSPECTION AND MAINTENANCE PROGRAM................................... 38

IV
 Abbreviation List

ABD - As Built Documentation

AGI - Above ground installation
ALARP - As Low As Reasonably Possible
CA - Certifying Authority
CAR - Corrective action report
CP - Cathodic Protection
CTOD - Crack Tip Opening Displacement
DSD - Distribution System Directive
EMP - Environmental Management Plan
HAZ - Heat Affected Zone
HAZID - Hazard Identification Study
HAZOP - Hazard & Operability
HSE - Health, Safety & Environment
NCR - Non conformance report
NDT - Non Destructive Testing
NGA - Natural Gas Authority- Israel
OPM - Operating Manual
Owner - Owner may be owner and/or operator
P&ID - Process and instrumentation diagram
PFD - Process flow diagram
(W)PQR - (welding) Procedure qualification record
QA/QC - Quality Assurance / Quality Control
QP - Quality Plan
SCADA - Supervisory Control And Data Acquisition
SMS - Safety Management System
WPS - Welding procedure specification

V
SECTION 1.0 GENERAL

1.1 This document shall be known as the Distribution System Directive, hereinafter
entitled the DSD.

1.2 The DSD shall be supplementary to the Natural Gas Law, Safety Decree and
shall be read in conjunction with them.

1.3 The DSD provides requirements of the requested information necessary to obtain
NGA approval for the design, fabrication, installation and operation of a low
pressure natural gas distribution system.

1.4 The standard relevant for the DSD is the Israel Standard SI 5664-3.

1.5 The general objective of the DSD is to present instructions and guidelines
required by the Natural Gas Authority (NGA) to the supplier, Owner or Operator
(herein, owner) of an a low pressure natural gas distribution system, with the
intention of assisting the applicant obtaining required, necessary permits.

1.6 The DSD is applicable to the planning, designing, fabrication, constructing,

operating and maintaining of a low pressure natural gas distribution system and
does not address local and regional permitting.

1.7 Owner shall be in full compliance with the DSD. When in full compliance with the
requirements of the DSD and all other specific requirements made by the NGA,
the NGA will submit written confirmation of compliance to the required Regional
Planning Committee.

1.8 Once written confirmation has been submitted by the NGA to the Regional
Planning Authorities, the owner may continue to apply for the required building
permits (‫)היתרי בנייה‬.

1.9 Owner’s compliance with the DSD shall be verified with the NGA through the
ongoing process, as described below. Only upon completion of this process will
written approval be submitted, as described in section 1.7.

1.10 Owner shall bear all costs associated with Owner’s compliance with the DSD and
application for permits. The NGA shall not bear any commercial or other

6
 responsibility related to Owner’s successful or unsuccessful compliance with the
DSD and application for permits.

1.11 The NGA shall be the custodian of the DSD. The Owner shall be obliged to
obtain the latest version of the DSD inclusive of all its supplements, addendum,
etc., from the NGA

1.12 The purpose of the DSD is to create conditions for the safe and efficient
development and use of a low pressure natural gas distribution system in
accordance with Israeli governmental law and policy.

It shall be emphasized that the Owner bears the sole responsibility for the safe
construction, operation and maintenance of the distribution system and shall
implement the required procedures, means and methods, as a prudent operator,
assuring that the system integrity is maintained throughout its design and
operational life.

1.13 Before Owner can install and subsequently operate a low pressure natural gas
distribution system, the Owner shall apply for a permit and such permit shall be
granted before commencement of any installation related activity. The DSD
provides guidelines and instructions for Owner to follow in his application
procedure for an installation and operating permit.

1.14 Exemptions to the DSD may be granted by the NGA only upon written request by
Owner and subject to agreed restrictions and conditions. Such agreed exemption
shall carry NGA signature. Exemptions to the DSD shall be considered on a
case-by-case basis and a given exemption can be withdrawn if:

1.14.1 the data furnished by Owner to obtain it appear to be incorrect or

incomplete to the extent that the exemption would not have been
granted if the actual data had been known at the time the decision
was made.
1.14.2 the circumstances on the basis of which it was granted have
changed to the extent that the exemption would not have been
granted if the altered circumstances had existed at the time the
decision was made.
1.14.3 It cannot be maintained in case a safety hazard develops out of it.
1.14.4 It appears that one or more conditions, under which it was granted,
are not complied with.

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SECTION 2.0 DESIGN OF THE SYSTEM

2.1 Schedule

2.1.1 As an essential part of the preparation of the design, the Owner shall prepare a
detailed schedule providing data on all aspects of the planned project
development including but not limited to design, procurement, manufacturing,
fabrication, installation, testing and commissioning aspects. This data shall
include:

description of all key activities in logical sequence

early and late start of these activities

early and late completion of these activities

scheduled or available float in all activities

interfaces with third parties

milestones

target dates for getting permits

contingencies and mitigation measures in case of conflicts

2.1.2 This schedule shall take into account the review process of the NGA, as
described below. This schedule shall be submitted to the NGA periodically during
the life of the project.

2.1.3 This planning stage shall be accompanied by a revision track record, that
provides information, background of schedule changes and mitigation measures
in case schedule changes might create conflicts.

2.2 Detailed Design

2.2.1 The Design shall make reference to the relevant regional permit and shall
provide more detailed information complementary to the requested
information therein.

2.2.2 The design shall provide a complete and comprehensive summary of all
design related data and criteria applicable to the proposed low pressure
natural gas distribution system such as:

8

Reference to the design code stated in section 1.4, guidelines,
technical specifications and all addenda to these

Relevant engineering decisions, their rationality, choice of
design related parameters and any other variables having
impact on the design.

Software used for design and analyses

Decisive design factors derived from the route survey,
environmental, corrosion and protection philosophy, specific
operating criteria, required lifetime for the pipeline, etc.

2.2.3 The design shall provide specific details about project specific design
factors, waivers and deviations to the code, etc., all to be agreed between
Owner and NGA and such agreement shall be in writing and signed by
both parties.

2.2.4 This design should include a description and drawing that shows the
boundary limits of this project. These boundary limits should note the
upstream provider as well as the downstream owner. (as applicable)

2.2.5 The scope of the NGA review takes into consideration the upstream
boundary limits from the NG provider up to the first valve in the skid into
the turbine/ heater/ or other facility. Therefore, it is considered that this
valve is the downstream boundary limit and therefore shall not be included
in the design package.

2.2.6 The design shall be carried out by a recognized, competent, design firm to
assure its robustness.

2.2.7 To support the design, Owner shall conduct a detailed route survey of the
proposed system, on both sides of the theoretical centerline of the pipeline
corridor as well as around any above ground system facility, (e.g. block
valve station, PRMS, etc.) which shall provide the following data along the
route:

Surface topography

Location of any infrastrastructure facilities, infrastructure lines,
(ie High Voltage cables, below ground pipelines) buildings,
above and under ground structures, etc.

9

Land use limitations

2.2.8 The data obtained from this survey shall be evaluated and utilized in the
decision making regarding optimization of the proposed pipeline route and
be taken into consideration for the pipeline design, particularly taking into
account possible hazards to the NG pipe due to the surrounding areas.

2.2.9 The detailed design shall include the following items that firmly establish
the system parameters, installation and operating criteria and limitations:

Overall design philosophy and statements of code approval

Design pressures

Design temperature

Flows

Velocities

P&IDs

PFDs

Outside diameter

Wall thickness

Material grade (composition, choice of material)

Design drawings

Hazardous area drawings

HAZID

HAZOP

Corrosion protection measures. (corrosion coating, CP,
impressed current)

Stability measures (weight coating, burial, backfill)

Geotechnical report

Risk assessment

Environmental report

Protection measures (burial, backfill, concrete coating, saddles)

Installation criteria and limitations i.e. allowable stress level and
stress control during all phases of the pipeline installation
activities

Electrical design

Instrumentation design

10

Operating criteria and limitations such as gas flow, operating
pressure, surge pressure, minimum and maximum throughput

System layout inclusive protection system against over
pressurization

Stress analysis

Connection to the SCADA system

Supervision plan

2.2.10 The detailed design package shall be signed and approved by the
designers and the owner/operator.

2.2.11 The designer shall provide a statement that approves that the design
meets the requirements of the design code as found in section 1.4 as well
as the relevant.

2.2.12 The Owner shall provide a statement approving the above as well and
stating his readiness to own and / or operate this line in a safe manner

2.3 Provision of the Package

2.3.1 The owner shall provide the NGA with three color copies of the design
packages as well as three CDs that include all documents found in the
hard copies.

2.4 The NGA Review Process

2.4.1 The NGA shall review the design for content and shall be allowed to reject
the design out of hand, should the package quality not meet the required
high standards.

In the event that the package is rejected as such, the owner shall
have the right to reissue the package upon revision as described
above. This reissuance shall include a specific table of changes
made to the package that will assure that the package is robust.
This revised package shall also be approved by a second,
experienced independent design firm.

11
2.4.2 Upon initial acceptance of the design package, the NGA shall carry out a
design review and issue an approval or design comments. These design
comments will be provided in a tabular format to the owner for response.

2.4.3 Responses to these comments shall be provided to NGA within the table
format to assure tracking of the comments. Revised documentation shall
be provided in the format as described above.

2.4.4 The tracking of this design review stage shall be carried out strictly
through the table and therefore, it is advised that a highly detailed
response be provided within the table along with a specific mention of the
location of the document within the revised package.

2.4.5 Upon conclusion of the review, a revised design package shall be

provided (if applicable) as per the method described above.

2.4.6 The final design package shall be signed and approved by the designer.

2.4.7 The NGA shall provide the design approval for this package upon
completion of this review as well as other requirements of the NGA
described elsewhere.

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SECTION 3.0 PROCUREMENT

3.1 Manufacturing of the System

3.1.1 Based on the approved design package, the owner shall begin to carry
out the procurement process.
3.1.2 The Owner shall obtain all materials from reputable suppliers with proven
track records.
3.1.3 Owner shall establish acceptance criteria associated with suppliers and
demonstrate that these are met through conducting a pre-qualification
process.
3.1.4 This process of approval by the owner shall be fully documented for the
possible audit by NGA.

3.2 Lawful code

Line pipe and pipeline appurtenances shall be specified in compliance with lawful
codes and NGA approved specification. Before commencement of any
manufacturing, fabricating or procurement, the NGA and Owner shall have
agreement on the material specification, the manufacturing process and the
QA/QC plan in place to assure compliance of the materials with the specification
and codes in place.

3.3 Certificates

Each completed pipe or part (e.g hot bend, T, valve) shall have its own unique
manufacturing, inspection and test certificate which shall be presented to the
NGA or its appointed representative for final acceptance. The independent third
party shall accept the definitive material certificate by signing off the original
documents.

3.4 Traceability

Each pipe or part shall have a fully traceable history inclusive of its base plate
certificate and all steps of its manufacturing process and acceptance testing.

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3.5 Material Specification

3.5.1 The Material Specification shall provide details for the manufacturing
method, limitations, acceptance and rejection criteria, inspection method
and the material traceability method, of the following related elements (as
applicable):

Bare Line pipe

Line pipe corrosion coating

Line pipe weight coating and/or protection coating

Anodes

Line pipe bends

Flanges, Tees, valves and any other appurtenances

Corrosion coating for Flanges, Tees, valves and any other
appurtenances

3.5.2 As a minimum, the following data shall be verified:

Chemical composition of base materials.

Chemical composition shall be in compliance with chosen
material grade.

Mechanical properties of base materials based testing as per
the relevant code

Destructive tests may include: tensile testing (longitudinal and
traverse), fracture toughness, hardness (Charpy V, CTOD),
lamination detection, bending, etc.

Mechanical properties of all welds inclusive HAZ

Mechanical properties after bending, forging, heat treatment,
forming of base materials.

Corrosion sensitivity of end product. Accelerated corrosion
testing of weld, HAZ and base material sample

Dimensions

Measurements of wall thickness, pipe straightness, pipe body
ovality, pipe end ovality.

14
3.5.3 Owner shall provide the NGA with the inspection and testing program and
procedures proposed to verify that the chemical and mechanical
properties are met, frequency of testing not limited to destructive and
non-destructive testing method, testing equipment, verification,
acceptance and reject criteria, etc.

The manufacturing process shall be monitored through a pre-

agreed test and inspection plan, which shall be conducted by
qualified inspectors. The inspectors shall be employed by an
independent Certifying Body such as Lloyds, DNV, Bureau Veritas,
TUV or any party to be acceptable to the NGA.

For already made, off the shelf materials, Owner shall supply
evidence of authenticity of base material, manufacturing
specification with reference to lawful codes, test and inspection
and acceptance certification, signed by independent Certifying
Body such as Lloyds, DNV, Stoomwezen or any party to be
acceptable to the NGA.

The NGA reserves the right to review the material manufacturing

specification, test and inspection plan, QA/QC plan, etc and to
request for changes and/or amendments, before pipe
manufacturing and procurement of appurtenances is being
initiated.

During any phase of the manufacturing process, Owner shall

provide the NGA ample warning (minimum 2 weeks) for the NGA
to witness agreed hold points.

15
SECTION 4.0 CONSTRUCTION

4.1 Construction of the system

Upon completion of the above items, (ie design and fabrication) the owner may
commence with the construction document's submittal. NGA will review and
provide comments to the issues stated above. Owner shall provide response to
these comments in a timely manner. No construction activity should take place
prior to resolving all comments to the satisfaction of NGA. This process may be
timely and should be taken into account when developing the schedule. 60 days
prior to construction the owner will provide the following information:

4.1.1 Quality Management System procedure

The Owner shall be responsible to supply the NGA with a detailed Quality
Management System Plan. This plan shall be assessed by the NGA on its
safety aspects through a formal and systematic review of the installation
plan with the objective of hazard identification and execution concerns.
The plan shall provide full details of the pipeline installation aspects with
emphasis on management of personnel safety and pipeline integrity
control during all phases of the installation. Procedures shall be
developed for all specific installation aspects such as the pipe laying, pipe
burial, pressure testing, etc. The procedures shall noticeably address how
human safety and pipeline integrity are managed through all steps of the
installation, how this is monitored and judged.

4.1.2 Spread Supervision Procedures

Spread Supervision procedures shall include a description of the project

that is to be carried out as well as the roles and responsibilities of each
supervisory entity in the project.

4.1.3 Inspection and Test Plan

Inspection and Test Plan shall include specific construction actions and
the inspection and supervision coverage that is required by each entity on
the project, inclusive of the contractor and supervisory bodies. A definition
of each method of coverage should be included to assure that the
definitions are fully understood by all parties.

16
4.1.4 Organigram

Organigram shall include the role of each person on the project inclusive
of the contractor's personnel as well as the supervisory staff's.

4.1.5 Schedule of project

As an essential part of the preparation of the design, the Owner shall

prepare a detailed schedule providing data on all aspects of the planned
pipeline development including but not limited to design, procurement,
manufacturing, fabrication, installation, testing and commissioning
aspects.

4.1.6 Risk Assessment for construction

Risk Assessments shall include any risks that may arise during the
construction phase. This may include but is not limited to personnel risk,
equipment risk, material risk, and environmental risk.

4.1.7 Construction Procedures

Construction procedures shall include a detailed process for each and

every construction action that is expected to take place on the project.

4.1.8 WPS, PQR, welder certificates and NDT Examination for the project

Owner shall develop, test and implement approved welding and NDT
procedures for all of the welding of the pipeline in obedience of the lawful
codes and the requirements of the design code, stated in section 1.4,
augmented with the additional requirements to be detailed in a project
specific specification.

An independent Certifying Body shall verify compliance with the codes for
all phases of the weld procedure development inclusive its mechanical
and chemical testing. The NGA or its representative shall have the right to
witness the welding process procedure.

Owner shall apply a strict material traceability record of all base material,
weld consumables and test coupons identification and verification

17
 procedures. Similarly Owner shall apply strict recording of the applied
welding parameters. The approved welding procedure shall have been
signed by independent Certifying Body and supplied to the NGA for
review.

Each welder or welding machine operator shall be qualified in accordance

with design code requirements prior to the start of production welding by
making a test weld using the qualified welding procedure whereas Owner
shall assure that only qualified welders and welding operators are
employed during the welding of the low pressure natural gas distribution
system.

Production welding shall not commence until the qualified welding

procedures, qualified welders and qualified inspection personnel lists
have been reviewed and supplied to the NGA and satisfy the inspection
requirements of the independent third party.

Pipeline welds shall be non-destructively examined (NDT) in accordance

with design code requirements.

NDT shall be carried out to written procedures, which shall be submitted

to the NGA or its representative prior to the commencement of the work
and shall be reviewed and accepted by independent third party certifying
body.

Owner shall submit detailed procedure and technique sheets for NDT
examination signed off by independent Certifying Body for approval by
NGA prior to the start of production.

4.1.9 Electrical and Instrumentation Procedures shall describe the method

of construction of these systems to the stations as well as the SCADA
systems in place.
4.1.10 The Cathodic protection procedures shall describe the methods of
installation of the CP system to assure that the system is protected
both temporarily and permanently as per the requirements of the
approved design..

18
4.2 NGA Supervision

The NGA will visit the project over the course of the project and review issues
such as mechanical works, welding works, NDT, CP and E&I.

4.2.1 Contact between the third party agency and the NGA should be open and
independent. The reports of the third party agency shall be provided to
NGA for information, as needed.

4.2.2 The owner shall provide the supreme supervision reports written by the
designer.

4.2.3 Owner shall routinely update the NGA with regards to the project
schedule and the foreseen upcoming construction activities.

4.2.4 In the event of a significant design change, owner shall provide revised
drawings/ documentation to the NGA.

4.3 Notification to the NGA

The owner will provide NGA with notification of the following activities at least 72
hours in advance. NGA will have the option to attend these actions:

4.3.1 welding of sample for WPS approval

4.3.2 destructive tests at a certified lab
4.3.3 approval of welder's to the WPS
4.3.4 pressure test (strength, tightness)

19
4.4 Testing and Commissioning

4.4.1 Owner shall conduct and successfully complete a pipeline test before
taking the pipeline into service. The testing shall only be initiated after all
construction activities inclusive any remedial work, have been
successfully completed and the body, as a whole, shall no longer be
subjected to any loading, displacements, other than those for normal
operating. The testing program comprise three steps:

Conclusive confirmation that the pipeline or station has been

installed without any form of buckling and without any dents,
i.e. confirmation that the pipeline has not suffered any
structural damage through measuring its Internal Diameter (ID)
over its full length. This test is normally executed by pigging the
line with a gauge plate for pipelines. Size of gauge plate shall
be as per the specification. The AGI's shall be reviewed
visually for such confirmation during the pressure test.

Pressure testing of the complete pipeline system, (strength

test) should be carried out to the specification and approved
procedure.

Pressure testing of the complete pipeline system, to a pressure

of at least 1.1 times beyond the design pressure to confirm
leak tightness of the pipeline body. This leak test is normally
executed in continuation with the strength test whereby the
leak test pressure is lower than the strength pressure.

4.4.2 Owner shall develop and present to the NGA a pipe line test specification,
which shall include the Owner's method to execute the above three tests.
This specification shall, as a minimum, incorporate the requirements
stipulated in the design code, stated in section 1.4, but the NGA reserves
the right to review the test specification and to request for changes and/or
amendments, before pipe testing begins.

4.4.3 The agreed Test Specification shall be accepted by the independent third
party certifying body and designer and shall contain as a minimum the
following key criteria:

20

Testing criteria to meet inclusive settings, allowable margins

Test reject criteria

Remedial action in case any of the three test fails

4.4.4 Following the completion of the hydrotest, the owner shall provide the
NGA with an acceptance of hydrotest certificate as well as back up
documentation that includes:

pre hydrotest checklist

filling reports

equalizing reports

gauging reports

table of pressures

graphs of pressure

4.4.5 This certificate shall be approved and signed by the contractor, the
supervision team on behalf of the owner/operator and the third party
agency

21
SECTION 5.0 REQUEST FOR GASSING UP

5.1 Request Requirements

Upon completion of the construction and testing stage, the owner shall issue a
formal request for gassing up to NGA. This request will include the following
items:

5.1.1 A formal letter addressed to the NGA requesting an operations permit.

This letter should clearly define the system which is under request.
5.1.2 Construction Completion certificate (as noted in section 7.2) signed by
the contractor, the supervising company, the third party agency, the
owner and other relevant supervision. This certificate should base its
approval of completion to the design code stated in section 1.4.
5.1.3 Final mechanical completion certificate/checklist stating clearly parts of
the system completed and parts yet to be completed. This certificate
shall be related to a relevant specification. This document shall be
signed by all relevant parties.
5.1.4 If relevant to the request, the owner shall provide the letter he receives
from the downstream consumer stating the consumer’s readiness to
accept gas at the relevant pressures, quantities, flows, etc. This letter
shall include the downstream consumer’s design and construction
specification as well as the approval by the consumer, designer,
supervision, third party and contractor.
5.1.5 Approval letters from the designer of the segment
5.1.6 Check list for cold commissioning including general diagrams and
P&IDs.
5.1.7 Operation, Maintenance and Emergency procedures are approved by
NGA and other relevant parties and in place. (as described below)
5.1.8 Pressure test results and approvals inclusive of mechanical completion
checklist that was issued prior to the pressure test commencing
5.1.9 Copies of building permits (4 + 2 ‫) טופס‬
5.1.10 List and approved copies of all NCR/CAR/ deviation reports.
5.1.11 As Made Documentation

22
5.2 NGA Review

The NGA shall review the documentation provided for the above items and will
provide comments and request clarification as necessary. Owner shall allow for
sufficient time for NGA review of these items.

5.3 Provision of Gassing up permit

Upon fulfillment of the requirements of this chapter, NGA shall provide a gassing
up permit to the owner for the initial start up phase.

23
SECTION 6.0 OPERATIONS AND EMERGENCY

6.1 Procedure Details

The owner shall prepare a copy of an emergency and operations procedure that
will be reviewed by NGA.

6.1.1 The emergency procedure will take into account the natural gas facilities
in the premises as well as mutual influences possible from other, nearby
gas works and/or other infrastructure in the area. This plan shall provide
all possible emergencies related to the operation of a low pressure natural
gas distribution system.

6.1.2 Owner shall identify and classify emergencies and their consequences on
HSE.

6.1.3 For all cases Owner shall analyze the short term and long term effects of
such emergency and the response to the occurrence.

6.1.4 For each type of emergency, Owner shall have a pre-established

response and effect mitigation plan with the objective of avoiding or, at
least, limiting the negative effect on HSE. To accomplish this Owner must
demonstrate to the NGA that an effect mitigation /limitation philosophy is
in place, that a personnel rescue and evacuation procedures is in place,
that associated spare/repair materials are in stock, that specialist
contracts are in place, that repair and clean-up procedures are developed,
etc.

6.1.5 This emergency procedure will also include a valve by valve opening and
closing status to assure proper closure in the event of an emergency.

6.1.6 The owner shall prepare a copy of the operations procedures that will
include venting, gassing up, start up and operations, and commissioning
and decommissioning procedures (air to N2 to NG and NG to N2 to air)
and will include specific valve maneuvering and assurances of safe
practices on site. Valve maneuvering tables shall be prepared that clearly
note the status of each and every valve during the operation to assure
safe practices. These tables will provide for signature of at least two
people for each and every maneuvering action of valves.

24
 6.1.7 The operations manual shall provide more detailed and specific
information applicable to a low pressure natural gas distribution system,
complementary to the requested information therein

6.1.8 The operations manual shall address the following topics:

Steady flow operating conditions of the pipeline.

Planned shut-down of the pipeline

Unplanned shut-down of the pipeline

Planned re-start-up of the pipeline

Emergency shut-down and blow-down

Corrosion management

Inspection and maintenance.

6.1.9 For the above operations, Owner shall develop detailed procedures,
inclusive of step-by-step description of necessary actions, plans,
drawings, signs, manpower requirements, organisation, names and
contacts.

6.2 Construction Completion Certificate

Upon completion of all work and documentation, the following construction

completion certificate will be provided to NGA:

# Statement Requires Signature of:

1 All materials have been fabricated and constructed Fabrication:
according the relevant designer documents. Owner/operator, third
party agency,
Construction: owner, third
party agency , contractor
2 All materials were purchased by Owner/operator and Owner/operator
supplied in accordance with the design and
standards.
3 All welds have been checked, approved and Contractor,
accepted in accordance with the standards and Owner/operator, third
design. party agency

25
4 All works have been constructed in accordance with Contractor,
the approved design. Owner/operator , third
party agency
5 Holiday detection was performed in accordance to Contractor,
the standard. Owner/operator, third
party agency
6 All pressure tests, dewatering and drying of the Contractor,
pipeline and stations have been performed in Owner/operator, third
accordance with approved procedures and the party agency
results have been completed and accepted in
accordance with the standards.
7 Golden welds were performed and accepted by all. Contractor,
Owner/operator, third
party agency
8 All NCRs and CARs have been successfully closed Contractor,
out. Owner/operator, third
party agency
9 Permanent Cathodic Protection has been put in Contractor,
place as per the design and relevant standards and Owner/operator, third
accepted by all. party agency
10 All electrical works have been constructed as per Contractor,
design and relevant specifications and are ready for Owner/operator, third
start up of the facility. party agency
11 The SCADA system has been constructed as per Contractor,
design and relevant specifications and is ready for Owner/operator, third
operation upon start up of the facility. party agency

12 The firefighting system has been constructed as per Contractor,

design specifications, successfully hydrotested and Owner/operator, third
is ready for start up of the facility party agency
13 All safety and security measures are in place and are Owner/operator
ready for start up of the facility.
14 Cold commissioning has taken place successfully Contractor,
and accepted by all. Owner/operator, third
party agency

26
15 The system is ready for gassing up as per the design Contractor,
and relevant specifications. Owner/operator, third
party agency
16 Operations, Maintenance and Emergency Owner/operator
Procedures are complete and approved, all
operators have been trained, all parties are aware
and knowledgeable of the emergency procedures.
17 All issues and recommendations raised in the risk Owner/operator, risk
assessment (carried out during the design phase) assessor
have been successfully addressed.
18 All issues and recommendations raised in the Owner/operator, geo
geotechnical assessment and structural assessment technical designer and/or
(carried out during the design phase) have been structural engineer
successfully addressed.

Any request for concession from the above language shall be raised, in writing, prior to
construction to NGA.

6.3 System Completion Approval

Upon successful completion of the commissioning of the system, and completion

of the necessary adjustments to the downstream systems the owner shall provide
a "completion of hot commissioning and transfer to normal operations" certificate
to the NGA with language as follows:

Please be aware that the system (enter system title here) has undergone a
successful start up process as per the approved start up procedures and best
engineering practice. To date, the following systems are gassed up at the
following pressures, flows and temperatures:

Pressure:

Flow:

Temperature:
We, _____, hereby state that the system is ready and capable of regular operations as
per the design flows and pressures dictated.

Signed by:

Plant Manager Operations Manager

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Upon receipt of this certificate, NGA shall provide approval for operations permit.
SECTION 7.0 PROVISION OF AS BUILT DOCUMENTATION

7.1 As built Documentation Provision

The Owner shall supply the NGA with three hard copies and three electronic
copies of the As Built Documentation (ABD). The ABD shall encompass as-
manufactured, as-built and as-installed data of the completed pipeline system
and all its parts. This includes but is not limited to:

7.1.1 All line pipe-manufacturing records, approved and signed by a

recognised and by the NGA accepted independent Certifying
Authority. (CA) This includes for the coating records.
7.1.2 Inspection and acceptance certificates of all associated materials such
as flanges, elbows, anodes, valves, etc, signed by a recognised and
by the NGA accepted independent Certifying Authority. (CA) and
procured from pre-qualified supplier/manufacturer.
7.1.3 All welding and NDT records of the girth welds.
7.1.4 Pipe log book and welding log book
7.1.5 All inspection and test reports of the field joint coating.
7.1.6 All other construction reports pertinent to the pipeline.
7.1.7 As laid co-ordinates of the pipeline and stations on the original design
layout
7.1.8 As buried data of the buried pipeline and station sections with
confirmed depth of bury, soil cover, bury data shall be given at each
pipe girth weld.
7.1.9 Civil engineering as made documentation
7.1.10 Cathodic protection as made documentation
7.1.11 Electrical and instrumentation documentation

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SECTION 8.0 FINAL COMPLETION APPROVAL

The following are the steps that should be taken by the operator/owner which will
allow FINAL Completion Approval to be provided by NGA:

8.1.1 A formal letter addressed to the NGA requesting a completion approval

signed by the operator/owner of the system.

8.2 A copy of the NGA Temporary Gassing Up Permit that includes the caveats
that were found therein. The documents' package should include a
comprehensive list of the actions taken by the owner/operator in an attempt to
close out these caveats.

8.3 A formal approval of Hot Commissioning by the owner/ operator which includes
the approvals of the relevant supervisory bodies. This approval should include
any relevant documentation needed.

8.4 A formal approval that the system has been shifted to "normal operations" and
is running safely.

8.5 Formal close out of the As Made process including any reviews and comments
made by NGA or their representative.

8.6 Approved and signed Building Permits (4 ‫ וטופס‬3 ‫)טופס‬

8.7 Approval of the designer that the system was completed. Specific mention to
the geotechnical design and the approval of the system to the relevant risk
assessment is to be included.

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SECTION 9.0 HEALTH SAFETY AND ENVIRONMENT PLAN

9.1 General safety

Health, Safety and care of the Environment is of prime importance to the NGA.
Owner shall be committed to maintain a safe, healthy and injury free workplace
for its employees and any person working on behalf of the Owner. Furthermore,
Owner shall be committed to avoid damage to the environment.

9.2 Adherence to Procedures

Adherence to agreed procedures, work-plan, operating philosophy, etc., of all

personnel is fundamental to ensuring safe and efficient working conditions. It
should be stressed that the responsibility for Health, Safety and care for the
Environment is the responsibility of the owner and shall be an integral part of and,
is inseparable from all daily operations.

9.3 HSE Objectives

Owner’s HSE objective shall be to:

9.3.1 Provide effective safety systems and plans for managing HSE in all
his operations to ensure those risks are assessed and reduced to
level: As Low As Reasonably Possible (ALARP).

9.3.2 Properly inspect and maintain all equipment and tools.

9.3.3 Promote safety awareness, near miss reporting and a healthy,

responsible attitude amongst all personnel.

9.3.4 Ensure effective emergency response arrangements, backed-up with

trained and exercised personnel.

9.3.5 Establish and maintain clear written standards and procedures to

control the risk to HSE and ensure these are adhered to

9.3.6 Ensure that all personnel involved, either staff or subcontractors, are
competent and able to perform their tasks safely.

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 9.3.7 Ensure prompt investigation of incidents and that adequate
corrective actions are taken.

9.3.8 Promote joint consultation and lateral learning for all personnel
9.3.9 Provide sufficient resources for HSE advisory and audit services to
assist management to meet set HSE policy objectives.
9.3.10 Co-operate with statutory and professional bodies to promote
workable, practical standards and improve codes of practice and
legislation in relation to HSE matters.

9.4 Training and Material Maintenance

9.4.1 The NGA requires that all work under supervision of the Owner shall be
carried out with due observance of all legal requirements to achieve the
required statutory standards for Health, Safety and Environment.

9.4.2 Owner shall ensure that for all parties, personnel, contractors, working on
behalf of Owner, are fully familiar with and will adhere to statutory health,
safety and environmental standards and regulations. The HSE-Plan shall
include for regular audits, inspections, HAZIDs and HAZOPs. The NGA
reserves the right to witness audits, inspections, HAZOPs, HAZIDs and if
considered required, the NGA request for changes and/or amendments of
the plans prior to implementation.

9.5 Safety Management System

9.5.1 Owner shall develop and implement a safety management system (SMS).

9.5.2 The SMS is a systematic approach to safety and health aspects in the
execution of onshore pipeline installation operations.

10.5.3 The approach must be laid down in a formal description in which it must
be demonstrated that the work is organized in such a way that it can be
executed safely.

9.5.4 The SMS relates to all phases and combination of phases involved in
installation operations.

9.5.5 The SMS must in general contain objectives relating to safety and heath:

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The way it is intended to accomplish these objectives.

The standards applicable to accomplish these objectives.

The way in which observance of these standards will be
monitored.

9.5.6 The description of the SMS should satisfy the principles of quality
management as formulated in the ISO-9000 series and should contain, as
a minimum, the following elements:

Safety policy and control.

Establishment of safety management evaluation criteria.

Design, safety margins, review, applicable codes.

Operations, HAZOPs, compliance with statutory regulations and
industry standards, environmental limitations,

Personnel, required training standards, required courses, job
selection criteria.

Supervision, required experience, job analysis, risk identification,
incident and near miss reporting, accident and incident
investigation

Emergency planning and drills

9.6 Items to be Addressed in HSE Procedures

9.6.1 Disposal of chemicals used for the commissioning and conservation of

pipelines such as dye, corrosion inhibitors, oxygen scavengers, biocides,
etc.

9.6.2 Any limitations to exposure to the environment of chemicals, i.e. zinc

anodes.

9.6.3 For each project installation a HSE plan shall be developed. This plan
needs to address all measures taken to support safe and healthy working
conditions for all personnel involved and all measures taken to avoid
pollution of the environment. The HSE shall include safety training of
personnel, health and safety measures related to personnel transport to

33
 and from the offshore installation sites, health and safety training and
standards applied for hazardous work.

9.6.4 The HSE plan shall provide details of and schedule for safety audits.

9.7 Environmental Responsibility

An Environmental Management Plan shall be prepared by the Owner. The EMP

shall address the effects of materials, anodes, and coating on its environment.
With respect to cleaning and testing of the pipeline/AGI's using inhibited water,
the used chemicals shall be of a biodegradable nature. The EMP will specify all
areas of possible impacts due to the construction of the pipeline and all proposed
mitigation measures.

9.8 Incident reporting

9.8.1 Any incident occurring during the course of the manufacturing,

construction, installation and commissioning phase shall be reported, by
written statement, to the NGA within 48 hours of the incident. Such
Incident Report shall provide a full description of the course of such an
incident and the measures to mitigate reoccurrence of a similar type of
incident. Owner shall maintain statistics with respect to the incidents
occurring. These statistics shall be evaluated against threshold values,
pre-agreed between the NGA and Owner. In case unacceptable level of
incidents take place, the NGA shall instruct Owner to re-assess his SMS
and might stop all work until such re-assessment has been undertaken.

9.8.2 Similarly Owner shall report ’near-misses’, situations that have not
caused incidents but had the potential to do so. Owner shall actively
pursue near miss reporting amongst all personnel involved in the work.

9.9 Hazard Identification Study (HAZID)

9.9.1 Owner shall apply a structured manner in hazard identification, by

conducting frequent assessments of the work. These HAZIDs shall be in

34
 the form of a meeting in which a multidisciplinary brainstorming season
shall be held about the work activities, the circumstances on the work
place, the human factor, etc. The end result of a HAZID should lead to
identification of potential hazards, shortcomings and out of this, possible
recommendation, improvements could be accomplished.

9.9.2 The objective of HAZIDS is to provide the NGA assurance that:

The Owner selected technology can be applied with

confidence so as to provide a safe and operable low pressure
natural gas distribution system

The manufacturing, fabrication and installation of the system
can and will be achieved without unacceptable dilution of
design intent.

That the Owner is adequately prepared to commission and
operate the pipeline

The system is achieving an acceptable level of safe operation
consistent with commercial intend.

35
SECTION 10.0 QA/QC SYSTEM QUALITY ASSURANCE AND
CONTROL PLAN

10.1 Owner shall develop, implement, maintain and report using an approved
Quality System, which shall be in accordance with ISO 9000 series. Owner
shall present the NGA his quality system as a document hereinafter referred
to as the Quality Plan (QP). The QP shall address the measures taken to
assure that all aspects of manufacturing, procurement, installation and
commissioning are executed to internationally and/or domestically
recognised standards and, as a minimum, to ISO 9000 series.

10.2 The QP shall include for hold points related to, witnessing, inspection and
acceptance hold points by the NGA. The NGA reserves the right to review
the QP and to request for changes and/or amendments, before the QP is
implemented.

10.3 Upon implementation of the QP, Owner shall timely invite the NGA for
witnessing the agreed hold points. It will be up to the NGA’s discretion to
witness these hold points.

10.4 The independent third party shall further check the quality of the work and
the effectiveness of Owner’s quality system on spot check basis. Owner
shall carry out all remedial actions as a result of such sampling.

10.5 Contractors, sub-contractors, suppliers, fabrication and installation

contractors, proposed by Owner for the pipeline work, shall be reputable,
pre-qualified entities. Owner shall, on request, supply the NGA information
regarding the proposed entities track record, reputation, pre-qualification
criteria and compliance with these, audit results. On request, Owner shall
supply the list of pre-qualified entities.

10.6 The QP plan shall further include for an inspection, test and audit plan.

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SECTION 11.0 INSPECTION AND MAINTENANCE PROGRAM

11.1 Owner shall develop and submit to the NGA a system inspection and
maintenance program for the lifetime of the complete system including all
sections. The inspection of the pipeline shall be internal and external.

11.2 The internal inspection shall confirm the internal pipe body integrity. The
pipeline internal integrity could be jeopardized as the result of corrosion,
pitting, and buckling resulting from internal or eternal accidental loads.

11.3 The external inspection shall confirm that the external pipeline body has not
suffered from accidental loads.

11.4 External inspection shall be conducted using approved methods of

inspection.

11.5 The NGA or its appointed representative shall be invited by Owner to witness
the inspection.

11.6 If the inspection results give reason for concern and the pipeline integrity is
considered to become a HSE concern, the NGA has the right and will request
Owner to shut-down the system and to make it safe without delay.

37