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

Updates from the President

I recently attended the American Petroleum Institute’s 2018 Summer Standardization Conference held in Denver, CO, the week of June 11th. My main focus was on the following:

• Technical Session – Presenting  SC20 Service Standards
• SC18 – Subcommittee on Quality
• SC20 – Subcommittee on Supply Chain Management

 

Important Changes

The following important changes are coming (click the link below to jump to section):

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SC18 – Subcommittee on Quality

1. API Spec. Q1, 9th Edition, Addendum 2
2. API Spec. Q1, 10th Edition and ISO 9001:2015
3. API Spec. Q2, Revision
4. API Product Audit Questions
5. Manufacturing Capability

SC20 – Subcommittee on Supply Chain Management

1. June 12, 2018 Technical Session
2. Document Matrix
3. Documents Published in API Monogram Program Product Specifications
4. Business Needs (Process Defined)
5. Adaptive Manufacturing (3D Printing)

Citing of API Documents

API Licensing and Certification Activities

Documenting Your Gap Analysis

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Subcommittee 18 Overview

API Spec. Q1, 9th Edition, Addendum 2

Addendum 2 was published in June of 2018; its implementation date is June 1, 2019. The major focus of this revision has to do with critical product, components and/or activities.

The biggest impact has to do with the definition of supply chain suppliers and associated sub-supplier(s) required for product realization. This basically means that your supplier’s suppliers will have to be evaluated with regards to your definition of what “critical” means as it relates to:

• The products and components your company purchases
• The activities performed on your products (e.g., heat treatment, welding, plating, coating, NDE) through your tier 1 suppliers
• The activities performed on the parts and components you purchase from the supply chain (e.g., tier 2, tier 3, tier 4 suppliers and so forth)

Please attend our API Spec. Q1, Addendum 2, training class for a comprehensive breakdown of Addendum 2 requirements and what this means for your company, as these changes may pose a serious risk to your company if not implemented.

Q1, 10th Edition & ISO 9001:2015

SC18 Task Group 2 has the responsibility to review the ISO 9001:2015 document and identify the changes that will be incorporated into API Spec. Q1. TG2 has held several meetings and began their efforts on Q1, 10th Edition changes. It is anticipated that the Q1, 10th Edition, publish date is June 2020.

API Spec. Q2, Revision

Q2 remains in the revision process. The revision should be completed soon, and the revised document should be submitted for ballot sometime this year.

API Product Audit Questions

API product questions are in the process of being reassessed. Product specification questions will eventually be discontinued. More than 100 audits have been conducted in North America using the new method. The new method will focus on:

• The specific products licensed to the licensee as published in the licensee’s scope on the API Composite List
• Areas such as:
  – Design
  – Materials
  – Welding
  – Pressure Testing
  – Coating / Painting
  – Marking
  – Preparation for Shipment
  – Documentation
  – Facility Requirements
  – Normative Annexes

Input for the focus areas is received from the API Product Specification subcommittees. This new methodology allows the auditor to be directly engaged and provides more flexibility. To date, the API has completed documentation to deploy this new method for 83 documents under the API Monogram Program.

Also remember that all API Product Specifications have a relationship to API Spec. Q1. Essentially this means that the applicable product specifications are providing a bit more detail on some Spec. Q1 requirements. Remember, this doesn’t mean that the product specs replace Q1 requirements; rather, they supplement them.

The following is an illustration of how API Spec. Q1 are interrelated with product specifications:

Q1 Requirement	Product Specification Requirement
Acceptance Criteria – 5.4.3 Design Acceptance Criteria – 5.6.2 Purchasing Information – 5.7.1.3 Process Control Documents – 5.7.1.5 Validation of Processes for Production and Servicing – 5.7.7.2 In-process Inspection and Testing – 5.8 Control of Testing, Measuring, and Monitoring Equipment – 5.10.3 Manufacturing Acceptance Criteria	– Design Criteria – Material Specification Criteria – Visual Criteria – Dimensional Criteria – Hardness Testing Criteria – Nondestructive Examination Criteria – Welding Criteria – Heat Treating Criteria – Test Criteria – Coating and Plating Criteria
4.3.2.2 Personnel Competence	Quality Control Personnel Qualifications – Nondestructive Examination Personnel – Visual Examination Personnel – Welding Inspectors – Welder Qualification
4.4.3 Control of Documents	Like words shown in the spec. such as: – Manufacturer’s written specification – Procedure – Operating Manual – Instruction – Manufacturer Instructions – Quality Control Instructions – Manufacturer’s documented instructions
4.4.4 Use of External Documents in Product Realization	Normative References
4.5 Control of Records	– Quality Control Records – Documentation – Record – Retention
5.4 Design and Development	Design and Material Requirements
5.7.1.5 Validation of Processes for Production and Servicing	Specific requirements for processes such as: – Heat Treating – Welding – Nondestructive Examination
5.7.3 Identification and Traceability	Identification, Traceability, Serialization
5.7.6 Preservation of Product	– Preservation Requirements – Packaging Requirements – Shipping Requirements
5.7.7 Inspection and Testing	Visual and dimensional inspection, nondestructive examination, welding inspection, drift testing, hydrostatic testing
5.7.8 Preventive Maintenance	Maintenance Requirements
5.8 Control of Testing, Measuring, and Monitoring Equipment	– Calibration Procedure – Calibration Intervals – Controls for Specific Types of Equipment – Calibration Frequency
Annex A, Application of the API Monogram	Annexes, Application of the API Monogram

Manufacturing Capability

API Advisory #11, API Monogram Manufacturing Requirements, Manufacturing Capabilities, and Updated Licensing Agreement, was published on May 7, 2018. It discusses:

• Manufacturing Requirements and Capabilities
• Updated License Agreement

This subject has been widely discussed over the years. Now that there is guidance:

• Licensees need to be careful to maintain the integrity of their operations with regards to the amount of work that is outsourced
• Also, new applicants need to understand what the API will allow to be licensed under the API Monogram Program and what it will not allow

Read more about manufacturing capability in:

• The API Monogram Program License Agreement
• Q1, Annex A, Use of API Monogram by Licensees, A.7, Manufacturing Capability

On another note, Advisory #11 will not apply to those product specifications and/or standards that already identify manufacturing capability (minimum facility requirements), for example:

• API Spec. 6D, Specification for Pipeline and Piping Valves, Table 8, Minimum Facility Requirements
• API Standard 20M, Qualification of Suppliers of Machining Services for Use in the Petroleum and Natural Gas Industries, Section 4.1, Minimum Requirements

 

Subcommittee 20 Overview – Subcommittee on Supply Chain Management

12 June Technical Session

A Technical Session was presented on June 12th at the 2018 Summer Conference. SC20 was invited to give presentations on the SC20 service standards to familiarize attendees and subcommittee chairpersons with these activities.

The following presentations were given:

Standard	Title	Presented By
SC20	API Upstream Standard Development – Supply Chain Management	Rick Faircloth – SC20 Chairman; Cameron, a Schlumberger Company, Valves & Measurement
20D	Nondestructive Examination Services for Equipment Used in the Petroleum and Natural Gas Industry	Neal Ferguson – SC20 Vice Chairman, Element
20H	Heat Treatments Services – Batch Type for Equipment Used in the Petroleum and Natural Gas Industries	Joel Russo, Chairman, Technip FMC
20J	Qualification of Distributors of Metallic Materials for Use in the Petroleum and Natural Gas Industries	Jason Price, Fastenal
20M	Qualification of Suppliers of Machining Services for Use in the Petroleum and Natural Gas Industries	Bud Weightman, TG Chairman, Qualified Specialists International

SC20 Document Matrix

SC20 Document #	Title	Publish Date	*Spec.	**Standard	# of Licenses Issued	# Issued vs. Country
Spec 20A	Carbon Steel, Alloy Steel, Stainless Steel, and Nickel Base Alloy Castings for Use in the Petroleum and Natural Gas Industry, 2nd Edition	08/01/2017	X	–	9	China (8) Italy (1)
Spec 20B	Open Die Shaped Forgings for Use in the Petroleum and Natural Gas Industry, 1st Edition	04/01/2013 Errata 1, December 2013	X	–	34	China (28) India (4)
Spec 20C	Closed Die Forgings for Use in the Petroleum and Natural Gas Industry, 2nd Edition	10/01/2015	X	–	15	China (11) India (4)
Standard 20D	Nondestructive Examination Services for Equipment Used in the Petroleum and Natural Gas Industry, 1st Edition	09/01/2013 Addendum 1, October 2016	–	X	–	–
Spec 20E	Alloy and Carbon Steel Bolting for Use in the Petroleum and Natural Gas Industries, 2nd Edition	02/01/2017	X	–	–	China (7) Italy (2) Malaysia (1) Mexico (2) UK (4) USA (10) Singapore (1) South Korea (2)
Spec 20F	Corrosion Resistant Bolting for Use in the Petroleum and Natural Gas Industries, 1st Edition;	06/01/2015 2nd Edition Under Development	X	–	–	China (1) Italy (2) Malaysia (1) Mexico (1) Singapore (1) South Korea (1) UK (3) USA (5)
Standard 20G	Qualification of Welding Suppliers for Equipment Used in the Petroleum and Natural Gas Industry, 1st Edition (18TR4, Evaluation of Welding Requirements as Applicable to API Product Specifications, 1st Edition, used as a reference)	Under Development	–	X	–	–
Standard 20H	Heat Treatment Services – Batch Type for Equipment Used in the Petroleum and Natural Gas Industry, 1st Edition	10/01/2015	–	X	–	–
Standard 20J	Qualification of Distributors of Metallic Materials for Use in the Petroleum and Natural Gas Industries, 1st Edition	05/01/2017	–	X	–	–
Standard 20L	Qualification of Non-Metallic Seal Suppliers for Equipment Used in the Petroleum and Natural Gas Industry, 1st Edition	Under Development	–	X	–	–
Standard 20M	Qualification of Suppliers of Machining Services for Use in the Petroleum and Natural Gas Industries, 1st Edition	10/01/2017	–	X	–	–
Standard 20N	Heat Treatment Services – Continuous Furnace for Equipment Used in the Petroleum and Natural Gas Industry, 1st Edition	Under Development	–	X	–	–
Standard 20P	Qualification of Suppliers for Plating and Coating used in the Petroleum and Natural Gas Industries, 1st Edition;	Under Development	–	X	–	–
Standard 20R	Qualification of Suppliers of Subsurface electronics for use in the Petroleum and Natural Gas Industry, 1st Edition	Under Development	–	X	–	–

* Specification: Interested companies are eligible to apply for an API Monogram Program License (20A, 20B, 20C, 20E, and 20F).

** Standard: A Quality Registration Program is being identified, developed, clarified, and will eventually be implemented for the service standards (20D, 20G, 20H, 20J, 20L, 20M, 20N, 20P, 20R). Interested parties will be eligible to apply for APIQR Quality Management System Certification.

As of June 14, 2018, the API reported that approximately 124 SC20 service documents were sold:

Service Document	# Sold
20D	32
20H	44
20J	31
20M	17

 

SC20 Documents

They are starting to find their way into API Monogram Program product specifications; as an example, 20E and 20F as a “Normative Reference”:

• Both have currently been incorporated into 6DSS (Specification for Subsea Pipeline Valves), 16A (Specification for Drill Through Equipment), 16AR (Standard for Repair and Remanufacture of Drill-through Equipment), 16F (Specification for Marine Drilling Riser Equipment), and 17TR8 (High-pressure High-temperature Design Guideline for Subsea Equipment).
• Will be incorporated in 6A, 21st Edition (Specification for Wellhead and Christmas Tree Equipment) and 6D, 25th Edition (Specification for Pipeline and Piping Valves).

Other SC20 documents are also being considered for incorporation into the Normative Reference Section of API Product Specifications by the relevant Subcommittees.

SC20 Business Needs

The following is a high-level explanation of how the SC20 documents were developed:

• A business need has been created because SC20 documents:
  • Have been published (some).
  • Are in the process of being developed (some).
  • Are being included as information references in API Monogram Program product specifications.
    • Some are included as normative references.
    • Some are included as informative references prior to becoming normative.
  • Are initially being discussed by Original Equipment Manufacturers (OEMs) in their communications with their supply chains. More contact will become evident after the API presents a quality registration program to the industry for service standards.
  • May be needed as a solution to the revision to API Spec. Q1, 9th Edition, Addendum 2 regarding the “supply chain” and “critical product, components or activities.”
• Overview of How the SC20 Documents Have Come into Realization:
  • • A business need was identified by the industry (operators and OEMs) to extend API requirements further down into the supply chain.
    • Documents were then developed by relevant task group(s), including subject matter experts for the products/services covered, and published:
      • Some product specifications (20A, 20B, 20C, 20E, and 20F) are now part of the API Monogram Program and licenses are available.
      • A Quality Registration Program  is being identified, developed, clarified, and  will eventually be implemented for the service standards (20D, 20G, 20H, 20J, 20L, 20M, 20N, 20P, 20R).
      • API will audit SC20 Series applicants to the relevant specification or standard and the applicable quality management system, such as API Spec. Q1.
      • Organizations who successfully pass the process will be identified in an enhanced API Composite List.
      • This creates a licensed (for monogram products) or certified (for service standards) organization, which is discoverable by others using the API Composite List.
      • This provides:
        • OEM confidence in their supply chain.
        • Savings to the licensed/certified companies (less customer audits).
        • Savings to the industry at large.
        • Product/service consistency and integrity.

Adaptive Manufacturing (3D Printing)

A presentation was given to raise awareness of 3D printing being deployed in some manufacturing environments. Some of the topics discussed were:

• • 3D printing is useful in rapid prototype development
  • 3D printing is an additive manufacturing process and deposits layer upon layer of material
  • Production is currently taking place in different industries using the following types of materials:
    • Plastics
    • Rubber
    • Metals
      • Inconel
      • Stainless Steel
      • Aluminum
      • Titanium
  • Advantages:
    • Proof of concept can be achieved via short runs
    • No investment in permanent tooling
    • Parts can be manufactured through a CAD file
    • Shorter lead times for developing patters
  • Disadvantages:
    • Cost
  • 3D printing will require new methods of process qualification and product validation
  • There are existing specs./standards being developed for 3D printing, for example:
    • ASTM
    • DNVGL
    • NACE

While discussions were interesting, many companies are not willing to commit discussing their particular processes since most companies in the oil and gas industry are in the research and development phase.

Citing of API Documents

The API reported that API documents have been cited in 4,785 federal, state and international regulations.

What impact could this have on your quality management system?

A association could easily be drawn between the quality management system and:

• The identification and evaluation of statutory and/or regulatory documents as specified by Q1, Section 4.4.4 Use of External Documents in Product Realization
• Whether or not statutory and regulatory requirements have been considered in processes such as design input, product realization and purchasing

Linkage to Q1

Q1 Section	Wording
3.1.13 Legal Requirement	…statutory or regulatory
3.1.5 Compliance	…regulation or regulatory body
3.1.9 Design Validation	…regulatory requirements
3.1.14 Management	…legal
4.1.5 Communication 4.1.5.1 Internal	…legal
4.4 Documentation Requirements 4.4.1 General	…legal
4.5 Control of Records	…legal
5 Product Realization 5.1.2 Determination of Requirements	…legal
5.2 Planning	…legal
5.4.2 Design and Development Planning	…legal
5.6.1.2 Initial Supplier Evaluation—Critical Purchases	…legal
6.5 Management Review 6.5.2 Input requirements	…legal

 

API Licensing and Certification Activities

Here are some interesting statistics:

Quality Management System Certifications
1854 Companies
3225 Active Management System Certifications
Spec. Q1	1712
Spec.Q2	110
ISO 9001:2015	966
ISO 14001	16
OHSAS 18001	14

 

Monogram Program Licenses
Top Specs.		Top Countries
5CT	907	China	1752
6A	855	USA	840
6D	751	India	205
7-1	685	S. Korea	145
5L	537	UAE	136
7K	235	Italy	124
16A	221	Canada	117
16C	177	–	–
4F	158	–	–
Based Upon: 2500 Licensees 6000 Licenses

 

% of Spec.
USA	21%
China	38%
Global (remaining)	41%

 

Remember to Document Your Gap Analysis!

Based upon all the upcoming changes to API documents, it is extremely important that you remember to document your gap analysis.

While it may seem that this is business as usual, companies licensed under an API product specification or who have a quality management system certification are obliged to follow API Spec. Q1, Clause 4.4.4, Use of External Documents in Product Realization which states:

“When API product or other external specification requirements, including addenda, errata, and updates, are used in the design or manufacture of the product, the organization shall maintain a documented procedure for the integration of these requirements into the product realization process and any other affected processes.”

In other words, this means a consideration whether or not:

• • • A gap analysis will need to be performed to document the differences between the previous and the new revisions.
    • 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) and whether or not changes need to be made.
    • If the changes present a risk, then a risk assessment will need to be documented.
    • If changes are to be made, a management of change will need to be implemented with regards to the impact the revised specification will have upon your quality management system and related documentation.
    • Upon making all the changes, relevant personnel will need to be trained; the training will need to be documented and training effectiveness will have to be determined.
    • Subsequently all the changes will have to be implemented.

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QSI offers a variety of software applications and supporting documentation to help keep your QMS in compliance, regardless of upcoming revisions to industry standards or specs. Our applications include:

• • • Codes & Standards (Gap Analysis)
    • Risk Assessment
    • Management of Change
    • Training

You can customize the applications to meet your company’s needs, no matter your company’s size. View a comprehensive list of all software applications here.

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Be aware that the API Monogram Program Licensing Requirements have been revised; you can view them here.

Keep your eyes open for document changes on API’s website on their Annual Standards Plan webpage.