API Summer Standardization Conference 2016

Welcome to QSI’s API Standardization Conference Newsletter
(Exploration & Production)

Updates from the President

I recently attended the following American Petroleum Institute’s meetings at the 2016 API Summer Standardization Conference in Washington, DC the week of June 27th.   My main focus was on the following:

• API Monogram Program / APIQR Forum
• SC 18 – Subcommittee on Quality
• SC 20 – Subcommittee on Supply Chain Management

Before delving into the specifics of each of these topic areas, I want to present to you a summary of key dates and information related to the recent release of ISO 9001:2015, as failure to implement a transition and re-certification plan now may impose serious risk to your organization.

Summary of API’s Guidance on ISO 9001:2015

Although Q1, 10^th Edition has not been published, the API has issued guidance on this subject to licensees and quality management system (QMS) certificate holders.  Here are a few points to consider.

• Any new applicant will be audited to the requirements of ISO 9001:2015. This applies to those companies who seek an API product specification license, a Q1 QMS certification, an ISO 9001:2015 or dual API Q1 and ISO 9001 certification.
• Audits will be performed on existing licensees and QMS certification holders to ISO 9001:2015 after September 1, 2016; however, any audit comments (e.g., findings) will be identified as concerns.
• The API is encouraging all licensees and QMS certification holders to implement ISO 9001:2015 sooner rather than later due to the time it takes API to review certification packages.

As I’m sure all of you are aware, the ISO 9001:2015 changes are of great significance and will require many changes to your management system.

Implications for You

Lessons learned from the API Spec. Q1 9th Edition transition were that many companies waited until the last minute to start working on all of the changes needed to meet the new requirements. In addition, many did not consider that they also needed to complete a gap analysis, internal audit, CAR closure – including the need to ensure effectiveness – a management review, and conformity matrix.

As a result, many companies ended up having to go through a complete QMS re-audit. Some companies were suspended, and even worse, some were cancelled.

QSI is aggressively moving forward with the development of our new ISO 9001:2015 Technology Package, a comprehensive set of manuals, procedures, work instructions, etc., to meet the conformity requirements of the 2015 version.

API Monogram Program / APIQR Forum

1. Although the Oil & Gas Industry has slowed down, the API continues to receive new applicants to the API Monogram Program for product specification licenses and/or for API Q1, Q2, and/or ISO 9001 quality management system certification.

2. API is working with their auditors to ensure audits are performed to API’s requirements. Auditors go to an Auditor Summit every 2 years; a summit is held in the US, and one is held in China.  The summit is meant to identify new happenings in API’s programs and to provide additional training on new topics or topics of interest.

3. API is also increasing their auditor training webinars, which are topic specific. As an example, the purpose of the webinars is to provide interpretation of API requirements, discuss upcoming changes in Q1, Q2, ISO 9001 and the product specifications, and to provide overall awareness.

4. There are current discussions ongoing about changing the 3-year renewal audits for licensees to an annual audit; however, a time frame for the change has not yet been identified.

5. Additional requirements will be published in Q1, Annex A about the subject of “manufacturing capability.” Manufacturing capability relates to the minimum facility, equipment, and/or process requirements a facility must have in order to be licensed under the API Monogram Program.  It also has to do with the amount of subcontracted work that may be let to the supply chain. An API Advisory will also be published to discuss this subject.

6. Another Advisory (#9) will be published on the subject of API’s intellectual property. This primarily has to do with auditors ensuring that licensees and quality management system certificate holders can demonstrate that they have purchased the API documents applicable to their management system.

Subcommittee 18 Overview

1. Technical Report 18TR4 – Technical Report on the Evaluation of Welding Requirements as Applicable to API Product Specifications has been approved and is now being published (this is the SC 18, Task Group 6 output; the group that I chaired).This report has to do with standardizing welding requirements between API Monogram Program product specifications where welding is performed.  The report does not identify welding requirements; however, it does expand upon ASME Section IX and AWS D1.1 requirements related to applicable product specifications.

2. Technical Report 18LCM – Product Lifecycle Management System Requirements for the Petroleum and Natural Gas Industry is undergoing review to address comments received during the balloting process.This document applies to the repair of upstream “…pressure-containing and pressure-controlling products for wellbore fluids but may also be applied to other equipment that is specified by the product owner or customer…” equipment.  Once this report goes through the comment resolution process, it will be released for another review cycle.

3. API Spec. Q1, New Addendum – A new addendum will be released to identify BSEE concerns over industry bolting issues. While only a few sections of Q1 will be changed, the intent of the changes will be significant.  Some of the changes (these are only examples) will relate to the following; however, take note that the wording has not yet been finalized:
   • Purchasing controls related to changes in the supply chain that can negatively affect the quality of critical activities or products
   • Supplier ability to meet the applicable API product specification and industry standards
   • Supply chain; suppliers and any associated sub-supplier(s)
   • The addition of coating and plating that can impact product function as addressed in Validation of Process for Production and Servicing. I strongly suggest that no action with regards to changing your management system until the addendum has been issued.  While the new Q1 changes have been proposed due to the bolting issues, the changes would apply to any product where quality may be impaired. If you are interested in further reading, I suggest you go to the BSEE home page and type in “bolting” into the search bar, http://www.bsee.gov/ .

4. ISO 9001:2015 – SC18 Task Group 2 has the responsibility to review the ISO 9001:2015 document and identify the changes that will be needed to API Spec. Q1. When they identify the changes, Q1 will be revised to the 10^th Edition. TG2 should begin their efforts in August of this year.  While TG2 will meet regularly and give their best efforts, a tentative publish date has not yet been identified. In reality, this will be a very time-consuming task for TG2.

• API expects all companies to have ISO 9001:2015 implemented by 31 December 2017. While this sounds like you may have plenty of time, it is recommend that you begin very soon.  December of 2017 will come fast.
• After 31 December 2017 auditors will document Audit Action Record (AAR) (i.e., audit finding) when a nonconformity has been identified.

5. API Q2 – SC18 Task Group 5 is in the process of finalizing a Q2 Guidance Document. Hopefully, this will be coming soon.

Subcommittee 20 Overview

1. Document Under SC20 – There is quite a bit of activity in this subcommittee; shown below are the specifications and standards that are being worked on:

1. • Castings, Spec 20A (Published March 2012);
   • Open die forgings, Spec 20B (Published April 2013);
   • Closed die forgings, Spec 20C (Published November 2015);
   • Non-destructive examination, Standard 20D (Published September 2013);
   • Alloy and carbon steel bolting, Spec 20E (Published August 2012);
   • Corrosion-resistant bolting, Spec 20F (Published June 2015);
   • Welding services, Standard 20G (under development);
   • Heat treating services, Standard 20H (Published October 2015);
   • Distributors, Standard 20J (under development);
   • Don-metallic seals, Standard 20L (under development);
   • Machining services, Standard 20M (under development);
   • Continuous furnace heat treating services, Standard 20N (under development);
   • Plating and coating, Standard 20P (under development);
   • Subsurface electronics, Standard 20R (under development).

2. Specifications & Standards – You may notice there is a difference in the designators “specification” and “standard.”
   • • Specifications – licensees under the specifications must follow the requirements of the specification and API Spec. Q1 as specified under the API Monogram Program. In addition, licensees to these specifications will be allowed to use the API Monogram
     • Standards – depending upon the standard, companies may be required to:
       • Follow API Spec. Q1 as their quality management system requirements
       • Follow the requirements specified by the standard

   Additionally, some standards have progressive quality requirements, such as a service level 1, 2 or 3.  While at this time there are no API requirements to be certified under API Spec. Q1, companies may choose to be certified or may state that they conform to the requirements of the standard.

3. Important – Many API product specifications will consider identifying SC20 documents in the Normative Reference section or elsewhere in the product specification. For example, API Spec. 6D has identified SC20 documents:
   • In Annex G, API 20 Series Supply Chain Management (an Informative Annex)
   • In the Bibliography

4. TG20M – Please let me know if you have any interest in attending the TG 20M, for Suppliers of Machining Services task group. I chair this group and will be happy to invite you to the meetings.

Changes

While it is impossible to be involved in all of the technical meetings held at the standardization conferences, it is important to understand that these meetings result in the development of new documents and changes to existing technical documents.  Fortunately, the API has several web pages dedicated to the identification of changes:

• Standards & Errata Page
  http://www.api.org/products-and-services/standards/program-information/addenda-and-errata
• Annual Standardization Plan
  http://www.api.org/products-and-services

Please check these pages; the liaisons for the product specification subcommittees presented their work activities during the SC18 meeting.  There are a lot of changes coming.

Remember to perform a gap analysis to document changes to the product specifications and other industry codes and standards that have an impact upon your product and quality management system.  Here is a summary of the actions you should take:

• A gap analysis will need to be performed to document the differences between the previous and the new revisions (Q1, Section 4.4.4)
• A determination will need to be made as to whether or not the changes to any product specifications represent a risk to your existing design and/or current quality management system (i.e., a risk assessment to Q1, Section 5.3)
• A Management of Change (Q1, Section 5.11) may need to be implemented with regards to the revised quality management system documents
• Revised documents (Q1, Section 4.4.3) will need to be reviewed, approved and distributed
• Training (Q1, Section 4.3.2.3) will be required for the changes to the quality management system