480 North Sam Houston Parkway, East Houston, TX 77060 USA · Helping You Get The Job Done Right.SM API Today • API is the primary trade association for the oil and natural gas industry

Helping You Get The Job Done Right.SM

Chip EvansGlobal Services Manager

480 North Sam Houston Parkway, EastHouston, TX 77060

USA

Presenter:


API’s Origins

API Today

API Standards Development

API Training Activities

API’s Certification Programs

– Application Process

– Global Participation and Trends

– Certification Benefits

API in the Europe

Today’s Presentation


• During WWI, the United States needed to improve its delivery of petroleum products to its armed forces in Europe

• A committee of experts was gathered, consisting of oil company executives to address the issue

• They found that drilling delays caused by incompatible equipment at drill sites led to inconsistent oil production and delivery. More standardization was introduced.

• After WWI, the oil and gas industry realized that its collaborative efforts had been successful and decided to continue working together

• In 1919, the American Petroleum Institute was formed in New York City

API’s Origins


API’s Origins

For API’s first 10 years, its primarily focus was on three specific areas:

1. Gathering of vital industry statistics2. Proposing an acceptable tax code 3. Standardizing oilfield equipment

– Standardization provides uniformity of pipe sizes, threads, couplings and other equipment in the field. Standardization allows for equipment interchangeability. With interchangeability comes more sources of the standardized equipment.


API Today

• API is the primary trade association for the oil and natural gas industry. API is member-driven

• API’s primary mission is to influence public policy in support of a strong, viable US oil and gas industry essential to meet the energy needs of consumers in an efficient and environmentally responsible way. API lobbies the federal and state legislative and regulatory bodies

• API is based in Washington DC and has a staff of approximately 250


API Today

• API provides an industry forum to develop consensus on policies and collective action on issues impacting its members

• API provides the opportunity for standards development, technical cooperation and other activities to improve the industry’s competitiveness

• API represents more than 440 companies in every facet of the industry, including exploration and production, transportation, refining and marketing


API Today

API divided into segments• Upstream focuses on regulatory and legislative issues,

industry standards and practices. API works to ensure industry operations are conducted in a safe, efficient and environmentally responsible manner

• Downstream focuses on refining, marketing and transportation of petroleum products to service stations

• Marine focuses on transportation of petroleum and petroleum products, marine terminal operations and the impact of federal, state and international regulations, industry standards and practices. We promote safe, environmentally sound and efficient marine transportation


API’s Responsibilities to Industry

• Pipeline focuses on regulatory activities that directly affect the operators of petroleum pipelines. We provide a forum for the development of pipeline standards and the sharing of technical and operational information

• General focuses on domestic and international issues, particularly international trade issues since many members in this segment supply products and services worldwide

API covers the entire industry.


• API is a Standards Development Organization (SDO), and is accredited by the American National Standards Institute (ANSI)

• API maintains approximately 550 standards along with other publications

• API standards are in great demand globally, and many API standards have been adopted by ISO and others

• Who actually writes API standards? API standards are developed through an API organized, collaborative process that includes users, manufacturers and technical consultants



• API solicits participation from ALL corners of the world, from all disciplines within the industry

• API convenes standard conferences for measurement, upstream, downstream and others twice annually. All meetings are open to public



Until recently, API training has been fairly limited in scope and in its availability outside of North America.

The new APIUniversity includes:

• API sponsored training courses

• API & ABS (American Bureau of Shipping) joint courses

• Technomedia, providing Internet and computer based training

API Training Activities


API Certification Programs


API’s Certification ProgramsMonogram ProgramMonogram Program Perforator Design Perforator Design

Registration ProgramRegistration Program

Training Provider Training Provider CertificationCertification

ProgramProgram

ISO 9001 & ISO ISO 9001 & ISO 14001 Registration14001 Registration

Engine Oil Licensing Engine Oil Licensing and Certification and Certification

SystemSystem

API Spec Q1 API Spec Q1 RegistrationRegistration

ISO/TS 29001 ISO/TS 29001 RegistrationRegistration


Certify the Individuals

– Individual Certification Programs

– Training Courses

Certify the Management Systems

– Spec Q1 & ISO TS 29001 Registrations

– ISO 9001 Registration

– ISO 14001 Registration

Certify the Products and Services

– Monogram Licensing

– Engine Oil Certification

Certification ProgramsObjective

Comprehensive

Coverage


Certification ProgramsIndividual Certification

Individual Certification ProgramsIndividual Certification Programs


• Created to ensure a qualified supply of inspectors

• Based on API Standards:– API 510 - Pressure Vessel (1989)– API 653 – Tank Inspection (1992)– API 570 - Pipe Inspection (1996)– Qualification of Ultrasonic

Examiners– API 936 – Refractory Personnel– Tank Entry Supervisor– Service Station Contractors Safety

Qualification Program (2006)– OCTG Inspector Certification ( ? )



• Exam takers must first qualify to take the test

• Most are pen and paper; one is practical exam

• Exams scheduled annually, wherever we find concentrations of interest

• Thousands of ICP Inspectors worldwide (None in Romania)



Certification ProgramsQMS Programs

APIQR ISO 9001 RegistrationAPIQR ISO 9001 Registration

API Spec Q1 Registration ISO TS 29001 Registration

Helping You Get The Job Done Right.SMHelping You Get The Job Done Right.SM

• Started in late 1998• Built on API’s quality successes

– Answered calls from industry– Consistent with API’s charge

and core-competencies– Expanded user-sources for

good products and services – Simplification / consolidation

with other API certifications –Fewer audits & less cost.APIQR Dual Registration & API QualityPlus

Certification ProgramsAPIQR ISO 9001 Registration


02 Mining and Quarrying10 Coke and Refined Petroleum Products12 Chemicals14 Rubber and Plastic Products15 Non-metallic Mineral Products16 Concrete and Cement17 Basic Metal and Fabricated

Metal Products18 Machinery and Equipment

19 Electrical and Optical Equipment

20 Ship Building

28 Construction

29 Wholesale and Retail Trade

32 Renting of Machinery and Equipment

34 Engineering Services

35 Other Services (Testing and Analysis)

Certification ProgramsAPIQR ISO 9001 Registration – Scope Categories


API Spec Q1 RegistrationISO TS 29001 Registration

– the O&G sector-specific quality management standard.


• “Can we get API certified?”

– ‘No’ became YES!

• API Spec Q1 Registration says that the QMS meets API Spec Q1 for API and/or non-API products

• ISO TS 29001 Registration says that the QMS meets ISO’s QMS for oil and gas equipment (e.g. QS 9000)

• API Spec Q1 and ISO TS 29001 are identical

• Includes 33 requirements beyond ISO 9001 that are valuable to industry

Certification ProgramsAPI Spec Q1 & ISO TS 29001 Registrations


All products and services in the oil and gas industry

Certification ProgramsSpec Q1/TS 29001 Registration Scope Categories


• APIQR ISO 9001 Registration

• API Spec Q1 Registration

• ISO TS 29001 Registration

Certification ProgramsQMS Registrations Summary

API QualityPlus

Apply for one registration or all three!


Certification ProgramsEMS Program

APIQR ISO 14001 RegistrationAPIQR ISO 14001 Registration


• Intended to provide organizations with the elements of an effective Environmental Management System to achieve environmental goals

• Can be integrated with quality management requirements

• Improves API’s ability to operate as a ‘one-stop shop’ for industry registrations

Certification ProgramsISO 14001 Registration


Certification ProgramsProduct Certifications

Monogram ProgramMonogram Program

Engine Oil Licensing and Certification Engine Oil Licensing and Certification

Helping You Get The Job Done Right.SMHelping You Get The Job Done Right.SM

• Since 1924 – 80+ years!• Originally created to:

– facilitate the availability of safe, interchangeable equipment and materials for general use in the petroleum drilling and production industry

• Based on compliance to API Spec Q1 and at least one API Product Specification

• Move from self-certification to third-party certification

Certification ProgramsMonogram Program


Product Licensing Scope•Series 1 Belting •Series 2 Offshore Structures

–Structural Steel Pipe–Offshore Cranes–Steel Plate

•Series 4 Derricks & Masts–Drilling and Well Servicing Structures

•Series 5 Tubular Goods–Pipe–Casing and Tubing–Threading

•Series 6 Valves & Wellhead Equipment•Series 7 Drilling Equipment

–Drill Bits•Series 8 Hoisting Tools•Series 9 Wire Rope•Series 10 Oil Well Cements

–Cements–Casing Centralizers

•Series 11 Production Equipment–Sucker Rods and Pumps–Pumping Units

•Series 12 Production Vessels–Tanks, Dehydration Units–Heaters, Separators

•Series 13 Drilling Fluid Materials•Series 14 Offshore Safety Equip.

–Subsurface Safety Valve Equipment

•Series 15 Plastic Pipe•Series 16 Well Control Systems

–BOPs, Choke, Kill and Control Systems

•Series 17 Subsea Systems


The Monogram Program is an Industry Program:

– Created by industry– Standards drafted and maintained

by industry– Regulated and directed by

industry



What does the API Monogram mark on a product mean? – Licensee has QMS compliant

with API Spec Q1– Licensee met the applicable

API Product Specification requirements

– Invokes a warrantee between the licensee and purchaser, meaning that products meet the API Product Specifications



Use of the Monogram mark• Only for approved, current

Licensees (see Composite List)• Only when API Spec Q1 & API

Product Specifications are met• License number & date of

manufacture must be included• Applied at any time during the

manufacturing process, but must be removed if product is found to be nonconforming

• Can only be applied at the licensed facility



• 70 API Products Specifications in the Monogram Program – mostly Upstream segment of Industry

• API Committee on Refinery Equipment approved standards for Downstream inclusion:

– 547 & 548 electric motors

– All API valve standards

– More coming soon!



• Certifies that blenders and marketers of engine oil used in automobiles meet latest API standard for product quality

• Applicants submit detailed information about the base oils they use and other various chemical calculations, etc.

• Later, engine oil from these licensees is purchased from a shop and sent to a lab for testing

• 500+ certified lube companies. (None in Romania)

Certification ProgramsEOLCS


API Application Process


Application Process

• Application submittal

– Application documents, Quality Manual, Application fee

• Application process

– QM review and acceptance

– Schedule on-site audit

– Perform audit. Full audits @ each location.

• Audit length is based on many factors: scope, number of employees, existing QMS, etc.

– Non-conformance redress

– Issuance of applicable certificate


Global Participation and Trends


1863 Licensees248 Applicants

3037 Licenses363 Applicants

76% Non-USA67 Countries

Global ParticipationMonogram Growth – March 02, 2006


API Monogram ProgramLicensees / Licenses by Country

Country Licensees Licenses

USA 457 683

China 408 616

India 132 229

Canada 78 121

Italy 63 123

United Kingdom 58 87

Japan 53 99


API Monogram ProgramLicensees + Applicants by Country

Country LicenseesLicensees + Applicants

USA 457 485

China 408 524

India 132 144

Canada 78 86

Italy 63 69

United Kingdom 58 61

South Korea 53 61


API Monogram ProgramLicensees + Applicants by Region

Jan-02 Nov-03 Mar-06

North America 567 593 597

Asia Pacific 289 474 657

Europe 286 341 348

South Asia 89 141 162

South America 65 96 100

SE Asia 68 99 98

Middle East 44 64 85


567 593 597

348

474

657

341

286

289

0

100200

300

400

500600

700

Jan. 02 Nov. 03 Mar. 06

No. AmericaSo. AmericaSE AsiaSo. AsiaEuropeMiddle EastAsia Pacific

`

API Monogram ProgramLicensees + Applicants by Region


API Monogram ProgramLicensees + Applicants by European Country

Country LicenseesLicensees + Applicants

Italy 63 69UK 58 61

Germany 41 43Russian Federation 23 25

France 23 26Romania 22 23

Spain 16 17Turkey 15 18Ukraine 9 11

Poland/Czech Republic 7 8Austria/Greece 4 4

Hungary 3 3Slovak Republic 2 2

Belgium, Macedonia, Croatia, Slovenia 1 1


API Certification Benefits


Certification BenefitsBenefits to Purchasers

• API’s programs help purchasers locate suppliers capable of producing to API quality and product specifications

• Improves quality of products

• Reduces or eliminates the need for 100% purchaser on-site audits. Saves purchasers time and money


Certification BenefitsBenefits to API Certified Companies

• API’s name carries a strong reputation in the industry

• API is supported and guided by our industry with direct and immediate feedback from its committees

• API provides a consistent review. Other registrars sometimes have varying interpretations. API staff review every QM, every audit, every non-conformance, worldwide. That promotes fairness and consistency. This is especially relevant to companies with multiple facilities

• API auditors are qualified, calibrated and evaluated. Auditor Summits are held every 2 years

• Marketing support: API Composite List, ‘How to Purchase Monogram Equipment’


Certification BenefitsThe API Composite List

• Identifies certified companies:

– API Monogram Licensees

– APIQR ISO 9001 Registrants

– API Spec Q1 Registrants

– ISO TS 29001 Registrants

– Registered Perforator Designs

– Registered Training Course Providers

• Describes the scope of applicable API / ISO certification


• Includes all contact information

– Company name

– Physical address

– Phone, Fax, E-mail, Website

• Published and distributed to over 3000 purchasers, API certified companies and other interested parties annually

Certification BenefitsThe API Composite List


• www.api.org/compositelist

• Search by company name, API Spec, key word, certification number, others

• Advanced search options add country, region and others

• Highlights with Top 10s

• Applicants

• Auditors

• Updated weekly

Certification BenefitsThe On-line Composite List

http://www.api.org/compositelist



Search Criteria






To educate the consumer…and the Monogram licensee.

• Presented in 4-hour or 8-hour workshops• Focuses on a methodology that reduces the risk of inadequately

specifying API Monogram equipment• Presentation includes informative, easy-to-understand lecture

materials and workshop exercises to improve under-standing of the API Composite List, the API Monogram Licensing Program requirements, the purchasing guidelines in API product specs andAPI Non-conformance Reporting system

Certification BenefitsHow to Purchase API Monogram Equipment


API Monogram and Licensing overview– The history of the API Licensing Program– Requirements for API Monogram Licensees– Application Process– Requirements to follow when accepting API Monogram orders

Overview of oilfield equipment purchasing– The standard purchasing process is explained with specific

emphasis on the petroleum, petrochemical and natural gas industry

– Discussion will be encouraged to provide specific cases or activities that may be involved for individual organizations

– We will tailor to the specific purchasing processes of the host organization

Certification BenefitsHow to Purchase API Monogrammed Equipment


Choosing appropriately licensed manufacturers

– The API Composite List (explanation and exercises on-line) – Exercises include determining and selecting Licensees for

applicable specifications, geographic locations, and product types Specifying appropriate technical and quality requirements

– Process for determining and specifying the appropriate technicaland quality requirements for API Monogram products

– Exercises to familiarize participants with the API Monogram Purchasing Guidelines Handbook

– Handbook includes Purchasing Guidelines from each applicable API Specification in the API Monogram Licensing Program



Verification of technical and quality requirements – Methods to verify the specified purchasing requirements– Information includes monitoring, inspection and testing of

products and verification of the corresponding documentation– Tailored for specific organizations

Field nonconformance reporting– Licensee requirements for processing field nonconformances– Recommended reporting practices for the purchaser– API responsibilities – API Field Nonconformance Reporting website is visited and the

methodology for reporting field nonconformances is demonstrated



The best part?….It’s free.



API Certification Programs and Moody International have agreed to jointly promote API in Eastern Europe.

API will increase the number of qualified auditors.

API will participate in more regional events, interact more regularly with the end-user community, and endeavor to provide better service to its clients.

API will open its first overseas office this year in China, followed by India and the Middle East by 2007.

The offices will focus on the promotion of API Certification Programs, Training, and Standards.

API in Europe and beyond


Summary

– API represents the entire oil and gas industry. – API standards are vital to the industry.– API certification programs are vital to the industry.

– API has a proven record in the certification business.– API certifications are recognized and respected worldwide.

– API’s aim is to be a fully integrated source of quality: …to certify personnel

…who work within certified management systems…that manufacture certified products

Documents

480 North Sam Houston Parkway, East Houston, TX 77060 USA · Helping You Get The Job Done Right.SM API Today • API is the primary trade association for the oil and natural gas industry