Sui Southern Gas Company Ltd.Appointment of Inspection Firm for improvement in construction and material quality

APPOINTMENT OF INSPECTION FIRM FOR IMPROVEMENT IN CONSTRUCTION AND MATERIAL QUALITY

REQUEST FOR PROPOSAL

(RFP)

JANUARY 2014

SUI SOUTHERN GAS COMPANY LIMITED

Ref: MM/LNG-2012M/s____________________________________________________________________________________

Appointment of Inspection Firm for improvement in construction and material quality Section-1 Letter of InvitationThe Sui Southern Gas Company intends to bring about quality improvement in the supply of equipment, materials and services/works for its core-business functions i.e.: gas measurement, transmission and distribution alongwith manufacture of diaphragm-type meters for domestic customers. To begin with SSGC plans to appoint well-reputed engineering inspection firms having diversified experience in equipment, material and works inspections related to oil, gas and energy sector. The firm will be appointed for a term-contract specified in the bid documents and will be assigned tasks for inspections aimed at Conformance/Fitness-for-use decisions on as-and-when required basis.For the assigned tasks, the Inspection Firm will: Prepare detailed inspection plans comprising: comparison of specifications with applicable standards, definition of acceptance sampling criteria, method of inspection, further investigation/testing requirements to determine root causes of non-conformances. Conduct material/component costing studies encompassing raw materials, processing/production costs, labor costs, packaging/shipment costs, and other costs. Suggest the following for SSGC:a. Measures for improvement of quality through elimination of non-conformances and/or substitution with other material/component of improved characteristics, b. Amendment of equipment, material and works specificationsc. Facilitate QA department in preparing inspection procedures and advise necessary steps to improve in-house inspection/testing capabilities The Inspection Firm shall have adequate experience and comprehensive knowledge of the respective business. 1. The Request for Proposal (RFP) document comprises the following:i. Section-1 Letter of Invitationii. Section-2 Instructions to Biddersiii. Section-3 Contract Form (General Conditions, Special Conditions, Description of Services, etc.)iv. Section-4 Pre-qualification Document2. Inspection Firm with the requisite expertise and experience are invited to submit their proposals on Single Stage Two Envelope Bidding System whereby sealed technical and financial proposals shall be submitted in separate envelopes mentioning Technical and Financial Proposal on the top of the envelopes. Technical Proposals will be opened and evaluated first; Financial Offers of only technically compliant bidders will be opened later in the presence of bidders representatives. Financial Offers of the technically non-compliant bidders will be returned unopened along-with their Earnest Money.3. The Technical & Financial Proposals, duly completed, should arrive at 1500 Hrs. on 29 June 2012 at SSGCs office on the address given below:Materials & Inventory Management Department,Sui Southern Gas Company Limited,Bid Opening Room (Ground Floor of CRD Building)SSGC House, Sir Shah Suleman Road, Gulshan-e-Iqbal,Karachi.Ph. # 0092-21-99021116 in case of nil or delayed response, please call 99021024/99021211Fax # 99231583Email rahat.kamal@ssgc.com.pkazam.akhter@ssgc.com.pkkhalid.rathore@ssgc.com.pk

______________________General Manager (M & IM)Sui Southern Gas Company Ltd.Appointment of Inspection Firm for improvement in construction and material quality

__________________________________________________________________________________________________________Material & Inventory Management Department, 2nd Floor, SSGC House, Sir Shah Suleman Road, Block 14, Gulshan-e-Iqbal Karachi 75300, Pakistan Ph: 92 021 - 99021201 Fax: 92 021 -99231583

SECTION -2 INSTRUCTIONS TO BIDDERS

1. Bid Bond/Earnest money amounting to Rs.400,000 (fixed) shall be submitted in the in the form of Bank Draft/Pay Order/Bank Guarantee/Insurance Guarantee (Insurance Company having AA rating from PACRA/JCR) in favor of SSGC. The bid bond/earnest money shall be enclosed in the Technical proposal envelope. No Proposal shall be entertained without bid bond/earnest money. Bid Bond/Earnest money shall be retained upto 120 days and the Proposals shall remain valid upto 90 days, after the date of Technical proposals opening. A bank guarantee format is attached herewith (Annexure-I).2. Inspection Firm shall fill in the blanks spaces in Section-3 Contract Form (Special Conditions, Appendices, etc.), which shall become the Financial Proposal.3. A Performance Bond (Annexure-II) of the specified value shall be submitted by the successful bidder in the form of Bank Draft/Pay Order/bank guarantee from a scheduled bank operating in Pakistan in favor of SSGC. 4. Mobilization Advance shall be paid as per the Contract against a bank guarantee of equal amount issued from a scheduled bank operating in Pakistan. The bank guarantee format is attached as Annexure-III.5. The Inspection Firm shall comply with all local laws including the Pakistan Engineering Council Bylaws.6. All taxes and duties will be borne by the Inspection Firm as per prevailing laws.7. The successful Inspection Firm shall enter into a formal agreement with SSGC on judicial stamp paper of value at the rate of Rs.0.30 per hundred Rupee of the value of contract. The stamp duty would be borne by the Inspection Firm.8. SSGC reserves the right to cancel one / all proposal (s) or cancel complete project at any stage before assigning the contract.

Annexure-I(On Stamp Paper @ Rs.100 for first Rs. 100,000 and subsequent Rs. 50 per Rs.100,000 of Guarantee Value)BID BOND FORMATSui Southern Gas Company Limited,ST-4/B, Sir Shah Muhammad Suleman Road,Block 14, Gulshan-e-Iqbal,Karachi.

Dear Sirs,

In consideration of Messrs __________________________________hereinafter called The Bidder having submitted the accompanying bid and in consideration of value received from ___________________________ we hereby agree to undertake as follows:

1. To make un-conditional payment of Rupees _________________ upon your return demand without further recourse, question or reference to the bidder or any other person, in the event of the withdrawal of the aforesaid bid by the Bidder before the end of the period specified in the bid after the opening of the same for the validity thereof, or if no such period to be specified within 120 days after said opening and or in the event that the bidder within the period specified thereof, or if no period be specified with 15 days after prescribed forms are presented to the bidder of signature the bidder shall fail to execute such further contractual documents if any as may be required by the Company or on the Bidders failure to give the Performance Bond as may be required, for the fulfillment of resulting contract within 15 days of the acceptance of the bid.2. To accept written intimation(s) from you as sufficient evidence of the existence of default or non compliance as aforesaid on the part of the Bidder and to make payment immediately upon receipt of the written intimation.3. No grant of time or other indulgence to, or composition, or arrangement with the Bidder in respect of the aforesaid bid with or without notice to us shall in any manner discharge or otherwise, however, affect this guarantee and our liabilities and commitments hereunder.4. The guarantee shall be binding on us and our successors in interest and shall be irrevocable.5. This guarantee shall remain valid upto _______________.

Yours faithfully,

Note: Any extensions / amendments (in all guarantees / bonds) if required shall be made on stamp papers of Rs.50.

Annexure-II(On Stamp Paper @ Rs.100 for first Rs. 100,000 and subsequent Rs. 50 per Rs.100,000 of Guarantee Value)PERFORMANCE BOND FORMATSui Southern Gas Company Limited,ST-4/B, Sir Shah Muhammad Suleman Road,Block 14, Gulshan-e-Iqbal,Karachi.

Dear Sirs,

In consideration of your entering / having entered into Contract No.___________________________ with M/s. ___________________________hereinafter called The Contractor and in consideration of value received from the Contractor, we hereby agree to undertake as follows:6. To make un-conditional payment of Rupees _________________ and un-conditional payment in such amount as you may require from time to time as and when called upon by you to do so not exceeding in the aggregate payment of Rupees ____________, being the amount covering liquidated damaged and security for the due fulfillment by the Contractor of all liabilities, obligations, commitment and total and faithful performance of the above contract by the Contractor as specified in the above mentioned contract upon your written demand(s) without further recourse, question or reference to the Contractor or any other person in the event of the Contractors default in compliance with its obligations, liabilities and faithful performance arising under and in pursuance of the work committed by it in the above mentioned agreement of which you shall be the sole judge. 7. To accept written intimation(s) from you as sufficient evidence of the existence of default or non compliance as aforesaid on the part of the Contractor and to make payment immediately upon receipt of the written intimation.8. To keep this guarantee in full force from the date of this guarantee till the Contractors obligations as specified in the above referred contract and all other obligations of the Contractor as are contained in the above contract are duly fulfilled by the Contractor to the satisfaction of the Company.9. No grant of time or other indulgence to, or composition, or arrangement with the Contractor in respect of the performance of its obligations under and in pursuance of the said agreement or any clause thereof, with or without notice to us shall in any manner discharge or otherwise howsoever effect this guarantee and our liabilities and commitment there under.10. The guarantee shall be binding on us and our successors in interest and shall be irrevocable.11. This guarantee shall not be affected by any change in the constitution of the guarantor bank or the constitution of ___________________________.12. This guarantee shall remain valid upto _______________.

Yours faithfully,

Note: Any extensions / amendments (in all guarantees / bonds) if required shall be made on stamp papers of Rs.50

Annexure-IIIADVANCE PAYMENT GUARANTEE FORMAT

Sui Southern Gas Company LimitedSSGC House, Sir Shah Suleman RoadGulshan-e-IqbalKarachi-75300

Dear Sir,

CONTRACT No. .

WHEREAS, we understand that Sui Southern Gas Company Limited (Client) have signed a contract dated ___________, 2012 with M/s. _________________ for the consulting services as specified in the said contract, and that in accordance with the terms of the said contract, the sum of ___________ being 15% of the total value is payable in advance against an irrevocable Bank Guarantee.

Now therefore, in consideration of the above the Client is making advance payment of USD ____________ to the Inspection Firm, we, (name and address of the Bank) hereby Guarantee irrevocably and unconditionally to refund to you on demand upto ______________ in the event the Inspection Firm fails to fulfill any of the terms and conditions of the contract at the time or during the period specified in the contract, provided that any demand hereunder is received in writing at this office within the validity of this Guarantee accompanied by the Clients written declaration to us that the Inspection Firm has failed to comply with the terms of the contract and such declaration shall be accepted by us as conclusive proof that the amount claimed is due to the Client and we shall forthwith pay the Client the amount claimed.

Provided the Client have not demanded encashment, this Guarantee upon expiry shall become null and void, whether returned to us for cancellation or not.

This Guarantee is valid upto _____________, extendible on request from time to time as deemed necessary. The Guarantee will become null and void whether returned to us or not for cancellation, if the entire amount of advance payment is recovered by the Client, prior to the expiry of the advance Payment Guarantee.

This Guarantee shall be construed in accordance with the laws of Pakistan.

L.G. NO:Dated:

Yours faithfully,For and on behalf of(Name of Bank)

SECTION-3

FORM OF CONTRACT

FOR

Appointment of Inspection Firm for strengthening Quality Assurance (QA)/Quality Control (QC) activities

January 2014SUI SOUTHERN GAS COMPANY LIMITED

TABLE OF CONTENTS

Page No.

I.FORM OF CONTRACT12

II. GENERAL CONDITIONS OF CONTRACT

1. GENERAL PROVISIONS

1.1Definitions131.2Law Governing the Contract141.3Language141.4Notices141.5Location141.6Authorized Representatives141.7Taxes and Duties141.8Leader of Joint Venture141.9 Performance Bond16

2. COMMENCEMENT, COMPLETION, MODIFICATION, AND TERMINATION OF CONTRACT2.1Effectiveness of Contract162.2Termination of Contract for Failure to Become Effective162.3Commencement of Services162.4Expiration of Contract172.5Modification172.6Extension of Time for Completion172.7Force Majeure172.7.1Definition172.7.2No Breach of Contract172.7.3Extension of Time182.7.4Payments182.8Suspension of Payments by the Client182.9Termination182.9.1By the Client182.9.2By the Inspection Firm192.9.3Cessation of Services192.9.4Payment upon Termination192.9.5Disputes about Events of Termination 20

3. OBLIGATIONS OF THE INSPECTION FIRM

3.1General203.2Inspection Firm Not to Benefit from Commissions, Discounts, etc.203.3Confidentiality203.4Liability of the Inspection Firm213.5Other Insurance to be taken out by the Inspection Firm213.6Inspection Firms ' Actions Requiring Client's Prior Approval213.7Reporting Obligations223.8Documents Prepared by the Inspection Firm to be the Property 22of the Client3.9Equipment and Materials Furnished by the Client223.10Accounting, Inspection and Auditing22

4. INSPECTION FIRMS PERSONNEL AND SUB CONSULTANTS

4.1Description of Personnel224.2Removal and/or Replacement of Personnel23

5. OBLIGATIONS OF THE CLIENT5.1Assistance, Coordination and Approvals5.1.1Assistance235.1.2Co-ordination235.1.3Approvals245.2Access to Land245.3Change in the Applicable Law245.4Services and Facilities245.5Payments25

6. PAYMENT TO THE INSPECTION FIRM

6.1Lump Sum Remuneration256.2Contract Price256.3Terms and Conditions of Payment256.4Period of Payment256.5Delayed Payments266.6Additional Services266.7Inspection Firm Entitlement to Suspend Services26

7. SETTLEMENT OF DISPUTES

7.1Amicable Settlement267.2Dispute Settlement27

8.INTEGRITY PACT27

III. SPECIAL CONDITIONS OF CONTRACT28

1.8Leader of the Joint Venture281.9282.1Effectiveness of Contract282.2Termination of Contract for Failure to become Effective282.3Commencement of Services282.4Expiration of Contract283.5Insurance to be taken out by the Inspection Firm283.6Consultants Action Requiring Clients Prior Approval283.8Documents Prepared by the Inspection Firm to be the Property of the Client285.1.1Assistance by Client295.1.2Coordination295.1.3Approvals296.1Lump Sum Remuneration296.2Contract Price 29

IV APPENDICES32

Appendix A-Description of the Services33Annexure A-1 Acceptance Quality Limit (AQL) ISO 2859-1 : 1999 - Part-142Annexure A-2 to A-8 Distribution SOPs43 Appendix B- Reporting Requirements44Appendix C- Key Personnel and Sub contractors45Appendix D- Not Used46Appendix E- Breakdown of Contract Price47Appendix F- Not Used48Appendix G- Integrity Pact49

V. Section IV Pre-qualification Requirements51

V

I- FORM OF CONTRACT

This contract (hereinafter called the "Contract") is made on the ________ day of ____ [month] of ____ [year], between, on the one hand, Sui Southern Gas Company Limited (hereinafter called the "Client" which expression shall include the successors, legal representatives and permitted assigns) and, on the other hand, a joint venture consisting of the following entities, each of which will be jointly and severally liable to the Client for all the Consultants' obligations under this Contract, namely:________________________________________________________________________________________________________________________________________________________________________________________________________________________(hereinafter collectively called the "Inspection Firm" which expression shall include its successors, legal representatives and permitted assigns).WHEREASa. the Client has requested the Inspection Firm to provide certain services as defined in the Special Conditions of Contract attached to this Contract (hereinafter called the "Services"); andb. the Inspection Firm, having represented to the Client that they have the required professional skills, and personnel and technical resources, have agreed to provide the Services on the terms and conditions set forth in this Contract;NOW THEREFORE the Parties hereby agree as follows:1.The following documents attached hereto shall be deemed to form an integral part of this Contract:a. General Conditions of Contract;b. Special Conditions of Contract;c. The following Appendices:Appendix A: Description of ServicesAppendix B: Reporting RequirementsAppendix C: Key Personnel and Sub-ContractorsAppendix D:[Not used]Appendix E: Breakdown of Contract Price.Appendix F: [Not used]Appendix G: Integrity Pact (for Services above Rs. 10 Million)2.The mutual rights and obligations of the Client and the Inspection Firm shall be as set forth in the Contract, in particular:a. the Inspection Firm shall carry out the Services in accordance with the provisions of the Contract; andb. the Client shall make payments to the Inspection Firm in accordance with the provisions of the Contract.IN WITNESS WHEREOF, the Parties hereto have caused this Contract to be signed in their respective names in two identical parts each of which shall be deemed as the original, as of the day, month and year first above written.For and on behalf of

Sui Southern Gas Company LimitedWitness

Signature ___________________Signature ________________Name ______________________Name ____________________Title _______________________Title _____________________(Seal)For and on behalf of_______________________________________________NAME OF THE JOINT VENTURE OF THE INSPECTION FIRMNAME OF THE INDIVIDUAL INSPECTION FIRM

__________________________Name of Member No. 1WitnessSignature ___________________Signature ________________Name ______________________Name ____________________Title _______________________Title _____________________(Seal)_________________________Name of Member No. 2WitnessSignature ___________________Signature ________________Name ______________________Name ____________________Title _______________________Title _____________________(Seal)

II. GENERAL CONDITIONS OF CONTRACT1. GENERAL PROVISIONS1.1DefinitionsUnless the context otherwise requires, the following terms whenever used in this Contract have the following meanings:a. "Applicable Law" means the laws and any other instruments having the force of law in the Islamic Republic of Pakistan, as those may be issued and in force from time to time;b. "Contract" means the Contract signed by the Parties, to which these General Conditions of Contract (GC) are attached, together with all the documents listed in Clause 1 of such signed Contract;c. "Contract Price" means the price to be paid for the performance of the Services, in accordance with Clause 6;d. "Effective Date" means the date on which this Contract comes into force and effect pursuant to Sub-Clause 2.1;e. "GC" means these General Conditions of Contract;f. "Government" means the Government of the Islamic Republic of Pakistan and/or Provincial Government(s);g. "Foreign Currency" means currency other than the currency of Islamic Republic of Pakistan.;h. "Local Currency" means the currency of the Islamic Republic of Pakistan;i. "Member" in case the Consultants consist of a joint venture of more than one entity, means any of the entities, and "Members" means all of these entities;j. "Party" means the Client or the Inspection Firm, as the case may be, and "Parties" means both of them;k. "Personnel" means persons hired by the Inspection Firm or by any Sub-Contractoras employees and assigned to the performance of the Services or any part thereof;l. "SC" means the Special Conditions of Contract by which the GC are amended or supplemented;m. "Services" means the work to be performed by the Consultants pursuant to this Contract, as described in Appendix A;n. "Sub-Contractor " means any entity to which the Inspection Firm subcontract any part of the Services in accordance with the provisions of Sub-Clause 3.6; o. "Third Party" means any person or entity other than the Client, the Inspection Firm or a Sub-Contractor; andp. "Assignment" means the work specified in SC for which engineering inspection services are desired.1.2Law Governing the ContractThis Contract, its meaning and interpretation, and the relation between the Parties shall be governed by the Applicable Laws of Pakistan .1.3LanguageThis Contract has been executed in the English language which shall be the binding and controlling language for all matters relating to the meaning or interpretation of this Contract. All the reports and communications shall be in the English language.1.4NoticesAny notice, request, or consent made pursuant to this Contract shall be in writing and shall be deemed to have been made when delivered in person to an Authorised Representative of the Party to whom the communication is addressed, or when sent by courier, registered mail, or facsimile to such Party at the address of the Authorised Representatives specified under Sub-Clause SC 1.6. A Party may change its address for notice hereunder by giving the other Party notice of such change.1.5LocationThe Services shall be performed at such locations as are specified in Appendix A and, where the location of a particular task is not so specified, at such locations as mutually agreed by the Parties.1.6Authorized RepresentativesAny action required or permitted to be taken, and any document required or permitted to be executed, under this Contract by the Client or the Inspection Firm shall be taken or executed by the Authorized Representatives specified in the SC.1.7Taxes and DutiesUnless specified in the SC, the Inspection Firm, Sub-Contractor, and their Personnel shall pay such taxes, duties, fees, and other impositions as may be levied under the Applicable Law, the amount of which is deemed to have been included in the Contract Price.1.8Leader of Joint VentureIn case the Inspection Firm consists of a joint venture of more than one entity, the Inspection Firm shall be jointly and severally bound to the Client for fulfillment of the terms of the Contract and designate the Member named in the SC to act as leader of the Joint Venture, for the purpose of receiving instructions from the Client.

1.9 Performance BondA Performance Bond of specified fee shall be submitted by the successful bidder in the form of Bank Draft/Pay Order/bank guarantee from a scheduled bank operating in Pakistan in favor of SSGC. The Performance Bond shall remain valid for three (3) months after completion of the assignment.SSGCs right to recover damages from the bidder for breach of contract shall not be limited to the value of the Performance Bond. In the event of the successful bidder failing to execute a formal agreement or to submit the Performance Bond in the manner aforesaid and in the period specified, SSGC shall be entitled to appropriate the earnest money submitted by the bidder with the tender without prejudice, to their right to claim any further loss or damage which may result to them by reason of the aforesaid default of the bidder as if the contract is actually executed for the purpose of such claims.The bidder shall cause the validity period of the Performance Bond to be extended for such period(s) as required for the contract performance.

2. COMMENCEMENT, COMPLETION, MODIFICATION,AND TERMINATION OF CONTRACT2.1Effectiveness of ContractThis Contract shall come into force and effect on the date (the "Effective Date") of the Client's notice to the Inspection Firm instructing the Inspection Firm to begin carrying out the Services. This notice shall confirm that the effectiveness conditions, if any, listed in the SC have been met.2.2Termination of Contract for Failure to Become EffectiveIf this Contract has not become effective within such time period after the date of the Contract signed by the Parties as shall be specified in the SC, either Party may, by not less than twenty eight (28) days written notice to the other Party, declare this Contract to be null and void, and in the event of such a declaration by either Party, neither Party shall have any claim against the other Party except for the work (if any) already done or costs already incurred by a Party at the request of the other Party.2.3Commencement of ServicesThe Inspection Firm shall begin carrying out the Services at the end of such time period after the Effective Date as shall be specified in the SC.2.4Expiration of ContractUnless terminated earlier pursuant to Sub-Clause 2.9, this Contract shall expire when, pursuant to the provisions hereof, the Services have been completed and the payments of remunerations including the direct costs if any, have been made. The Services shall be completed within a period as is specified in the SC, or such extended time as may be allowed under Sub-Clause 2.6.The term "Completion of Services" is as specified in the SC.2.5ModificationModification of the terms and conditions of this Contract, including any modification of the scope of the Services or of the Contract Price, may only be made in writing, which shall be signed by both the Parties.2.6Extension of Time for CompletionIf the scope or duration of the Services is increased:a. the Inspection Firm shall inform the Client of the circumstances and probable effects;b. the increase shall be regarded as Additional Services; andc. the Client shall extend the time for Completion of the Services accordingly.2.7Force Majeure2.7.1Definitiona. For the purposes of this Contract, "Force Majeure" means an event which is beyond the reasonable control of a Party and which makes a Party's performance of its obligations under the Contract impossible or so impractical as to be considered impossible under the circumstances, and includes, but is not limited to, war, riots, civil disorder, earthquake, fire, explosion, storm, flood or other adverse weather conditions, strikes, lockouts or other industrial actions (except where such strikes, lockouts or other industrial actions are within the power of the Party invoking Force Majeure to prevent), confiscation or any other action by government agencies.b. Force Majeure shall not include (i) any event which is caused by the negligence or intentional action of a Party or such Party's Sub-Contractors or agents or employees, nor (ii) any event which a diligent Party could reasonably have been expected to both (A) take into account at the time of the conclusion of this Contract and (B) avoid or overcome in the carrying out of its obligations hereunder.c. Force Majeure shall not include insufficiency of funds or failure to make any payment required hereunder.2.7.2No Breach of ContractThe failure of a Party to fulfill any of its obligations under the Contract shall not be considered to be a breach of, or default under this Contract insofar as such inability arises from an event of Force Majeure, provided that the Party affected by such an event; (a) has taken all reasonable precautions, due care and reasonable alternative measures in order to carry out the terms and conditions of this Contract; and (b) has informed the other Party in writing not later than fifteen (15) days following the occurrence of such an event.2.7.3Extension of TimeAny period within which a Party shall, pursuant to this Contract, complete any action or task, shall be extended for a period equal to the time during which such Party was unable to perform such action as a result of Force Majeure.2.7.4PaymentsDuring the period of their inability to perform the Services as a result of an event of Force Majeure, the Inspection Firm shall be entitled to continue to be paid under the terms of this Contract, as well as to be reimbursed for additional costs reasonably and necessarily incurred by them during such period for the purpose of the Services and in reactivating the Services after the end of such period.2.8Suspension of Payments by the ClientThe Client may, by written notice of suspension to the Inspection Firm, suspend all payments to the Inspection Firm hereunder if the Inspection Firm fail to perform any of their obligations under this Contract, including the carrying out of the Services, provided that such notice of suspension (i) shall specify the nature of the failure, and (ii) shall request the Inspection Firm to remedy such failure within a period not exceeding thirty (30) days after receipt by the Inspection Firm of such notice of suspension.2.9Termination2.9.1By the ClientThe Client may terminate this Contract, by not less than thirty (30) days written notice of termination to the Inspection Firm, to be given after the occurrence of any of the events specified in paragraphs (a) through (e) of this Sub-Clause 2.9.1 and sixty (60) days' in the case of the event referred to in paragraph (f):a. if the Inspection Firm do not remedy a failure in the performance of their obligations under the Contract, within thirty (30) days after being notified or within any further period as the Client may have subsequently approved in writing;b. if the Inspection Firm become (or, if the Inspection Firm consist of more than one entity, if any of their Members becomes) insolvent or bankrupt or enter into any agreements with their creditors for relief of debt or take advantage of any law for the benefit of debtors or go into liquidation or receivership whether compulsory or voluntary;c. if the Inspection Firm fail to comply with any final decision reached as a result of arbitration proceedings pursuant to Clause 7 hereof;d. if the Inspection Firm submit to the Client a statement which has a material effect on the rights, obligations or interests of the Client and which the Inspection Firm know to be false;e. if, as the result of Force Majeure, the Inspection Firm are unable to perform a material portion of the Services for a period of not less than sixty (60) days; f. if the Client, in its sole discretion, decides to terminate this Contract.2.9.2By the Inspection FirmThe Inspection Firm may terminate this Contract, by not less than thirty (30) days written notice to the Client, such notice to be given after the occurrence of any of the events specified in paragraphs (a) through (d) of this Sub-Clause 2.9.2:a. if the Client fails to pay any monies due to the Inspection Firm pursuant to this Contract and not subject to dispute pursuant to Clause 7 within forty-five (45) days after receiving written notice from the Inspection Firm that such payment is overdue; b. if the Client is in material breach of its obligations pursuant to this Contract and has not remedied the same within forty-five (45) days (or such longer period as the Inspection Firm may have subsequently approved in writing) following the receipt by the Client of the Inspection Firm' notice specifying such breach;c. if, as a result of Force Majeure, the Inspection Firm are unable to perform a material portion of the Services for a period of not less than sixty (60) days;d. if the Client fails to comply with any final decision reached as a result of arbitration proceedings pursuant to Clause 7 hereof.2.9.3Cessation of ServicesUpon receipt of notice of termination under Sub-Clause 2.9.1, or giving of notice of termination under Sub-Clause 2.9.2, the Inspection Firm shall take all necessary steps to bring the Services to a close in a prompt and orderly manner and shall make every reasonable effort to keep expenditures for this purpose to a minimum. With respect to documents prepared by the Inspection Firm, and equipment and materials furnished by the Client, the Inspection Firm shall proceed as provided, respectively, by Sub-Clauses 3.8 or 3.9.2.9.4Payment upon TerminationUpon termination of this Contract pursuant to Sub-Clauses 2.9.1 or 2.9.2, the Client shall make the following payments to the Inspection Firm:a. Remuneration and reimbursable direct costs expenditure pursuant to Clause 6 for Services satisfactorily performed prior to the effective date of termination. Effective date of termination for purposes of this Sub-Clause means the date when the prescribed notice period would expire;b. except in the case of termination pursuant to paragraphs (a) through (d) of Sub-Clause 2.9.1, reimbursement of any reasonable cost incidental to the prompt and orderly termination of the Contract, including the cost of the return travel of the Personnel, according to Inspection Firm Traveling Allowance Rules.In order to compute the remuneration for the part of the Services satisfactorily performed prior to the effective date of termination; the respective remunerations shall be proportioned. 2.9.5Disputes about Events of TerminationIf either Party disputes whether an event specified in paragraphs (a) through (e) of Sub-Clause 2.9.1 or in paragraph (a) through (d) of Sub-Clause 2.9.2 hereof has occurred, such Party may, within forty-five (45) days after receipt of notice of termination from the other Party, refer the matter to arbitration pursuant to Clause 7 hereof, and this Contract shall not be terminated on account of such event except in accordance with the terms of any resulting arbitral award.

3. OBLIGATIONS OF THE INSPECTION FIRM3.1GeneralThe Inspection Firm shall perform the Services and carry out their obligations with all due diligence, efficiency, and economy, in accordance with generally accepted professional techniques and practices, and shall observe sound management practices, and employ appropriate advanced technology and safe methods. The Inspection Firm shall always act, in respect of any matter relating to this Contract or to the Services, as faithful advisers to the Client, and shall at all times support and safeguard the Client's legitimate interests in any dealings with Sub-Contractors or third parties.3.2Inspection Firm Not to Benefit from Commissions, Discounts, etc.The remuneration of the Inspection Firm pursuant to Clause 6 shall constitute the Inspection Firm' sole remuneration in connection with this Contract or the Services, and the Inspection Firm shall not accept for their own benefit any trade commission, discount, or similar payment in connection with activities pursuant to this Contract or to the Services or in the discharge of their obligations under the Contract, and the Inspection Firm shall use their best efforts to ensure that the Personnel, any Sub-Contractors, and agents of either of them similarly shall not receive any such additional remuneration.3.3ConfidentialityThe Inspection Firm, their Sub-Contractors, and the Personnel of either of them shall not, either during the term or after the expiration of this Contract, disclose any proprietary or confidential information relating to the Project, the Services, this Contract, or the Client's business or operations without the prior written consent of the Client.3.4Liability of the Inspection FirmThe Inspection Firm are liable for the consequence of errors and omissions on their part or on the part of their employees in so far as the design of the Project is concerned to the extent and with the limitations as mentioned herein below.If the Client suffers any losses or damages as a result of proven faults, errors or omissions in the design of a project, the Inspection Firm shall make good such losses or damages, subject to the conditions that the maximum liability as aforesaid shall not exceed twice the total remuneration of the Inspection Firm .The Inspection Firm may, to protect themselves, insure themselves against their liabilities but this is not obligatory. The extent of the insurance shall be up to the limit specified in second para above. The Inspection Firm shall procure the necessary cover before commencing the Services and the cost of procuring such cover shall be borne by the Inspection Firm up to a limit of one percent of the total remuneration of the Contract.The Inspection Firm shall, at the request of the Client, indemnify the Client against any or all risks arising out of the furnishing of professional services by the Inspection Firm to the Client, not covered by the provisions contained in the first para above and exceedingthe limits set forth in second para above provided the actual cost of procuring such indemnity as well as costs exceeding the limits set forth in third para above shall be borne by the Client.3.5Other Insurance to be taken out by the Inspection FirmThe Inspection Firm (a) shall take out and maintain, and shall cause any Sub-Contractors to take out and maintain, at their (or the Sub-Contractors', as the case may be) own cost but on terms and conditions approved by the Client, insurance against the risks, and for the coverage, as are specified in the SC; and (b) at the Client's request, shall provide evidence to the Client showing that such insurance has been taken out and maintained and that the current premiums have been paid.3.6Inspection Firm' Actions Requiring Client's Prior ApprovalThe Inspection Firm shall obtain the Client's prior approval in writing before taking any of the following actions:a. appointing such Personnel as are listed in Appendix-C merely by title but not by name;b. entering into a subcontract for the performance of any part of the Services, it being understood (i) that the selection of Sub-Contractors and the terms and conditions of the subcontract shall have been approved in writing by the Client prior to the execution of the subcontract, and (ii) that the Inspection Firm shall remain fully liable for the performance of the Services by the Sub-Contractors and its Personnel pursuant to this Contract;c. any other action that may be specified in the SC.3.7Reporting ObligationsThe Inspection Firm shall submit to the Client the reports and documents specified in Appendix B in the form, in the numbers, and within the periods set forth in the said Appendix.

3.8Documents Prepared by the Inspection Firm to be the Property of the ClientAll plans, drawings, specifications, reports, and other documents and software prepared by the Inspection Firm in accordance with Sub-Clause 3.7 shall become and remain the property of the Client, and the Inspection Firm shall, not later than upon termination or expiration of this Contract, deliver (if not already delivered) all such documents and software to the Client, together with a detailed inventory thereof. The Inspection Firm may retain a copy of such documents and software.Restriction(s) about the future use of these documents is specified in the SC.3.9Equipment and Materials Furnished by the ClientEquipment and materials made available to the Inspection Firm by the Client, or purchased by the Inspection Firm with funds provided exclusively for this purpose by the Client, shall be the property of the Client and shall be marked accordingly. Upon termination or expiration of this Contract, the Inspection Firm shall make available to the Client an inventory of such equipment and materials and shall dispose of such equipment and materials in accordance with the Client's instructions or afford salvage value of the same. While in possession of such equipment and materials, the Inspection Firm, unless otherwise instructed by the Client in writing, shall insure them at the expense of the Client in an amount equal to their full replacement value.3.10Accounting, Inspection and AuditingThe Inspection Firm (i)shall keep accurate and systematic accounts and records in respect of the Services hereunder, in accordance with internationally accepted accounting principles and in such form and detail as will clearly identify all relevant time charges, and cost, and the basis thereof, and (ii) shall permit the Client or its designated representatives periodically, and up to one year from the expiration or termination of this Contract, to inspect the same and make copies thereof as well as to have them audited by auditors appointed by the Client.

4. INSPECTION FIRM'S PERSONNEL AND SUBCONSULTANTS4.1Description of PersonnelThe titles, agreed job descriptions, minimum qualifications, and estimated periods of engagement in the carrying out of the Services of the Inspection Firm' Key Personnel are described in Appendix C. The Key Personnel and Sub-Contractors listed by title and/or by name, as the case may be, in Appendix C are deemed to be approved by the Client.4.2Removal and/or Replacement of Personnela. Except as the Client may otherwise agree, no changes shall be made in the Key Personnel. If, for any reason beyond the reasonable control of the Inspection Firm, it becomes necessary to replace any of the Key Personnel, the Inspection Firm shall provide as a replacement a person of equivalent or better qualifications;b. If the Client, (i) finds that any of the Personnel have committed serious misconduct or have been charged with having committed a criminal action; or (ii) has reasonable cause to be dissatisfied with the performance of any of the Personnel, then the Inspection Firm shall, at the Client's written request specifying the grounds therefore, provide as a replacement a person with qualifications and experience acceptable to the Client.c. Except as the Client may otherwise agree, the Inspection Firm shall; (i) bear all the additional travel and other costs arising out of or incidental to any removal and/or replacement; and (ii) bear any additional remuneration, to be paid for any of the Personnel provided as a replacement to that of the Personnel being replaced.

5. OBLIGATIONS OF THE CLIENT

5.1Assistance, Coordination and Approvals5.1.1 AssistanceThe Client shall use its best efforts to ensure that the Client shall:a. provide at no cost to the Inspection Firm, Sub-Contractors and Personnel such documents prepared by the Client or other consulting engineers appointed by the Client as shall be necessary to enable the Inspection Firm, Sub-Contractors or Personnel to perform the Services. The documents and the time within which such documents shall be made available, are as specified in the SC;b. assist to obtain the existing data pertaining or relevant to the carrying out of the Services, with various Government and other organizations. Such items unless paid for by the Inspection Firm without reimbursement by the Client, shall be returned by the Inspection Firm upon completion of the Services under this Contact;c. issue to officials, agents and representatives of the concerned organizations, all such instructions as may be necessary or appropriate for prompt and effective implementation of the Services;d. assist to obtain permits which may be required for right-of-way, entry upon the lands and properties for the purposes of this Contract;e. provide to the Inspection Firm, Sub-Contractors, and Personnel any such other assistance and exemptions as may be specified in the SC.5.1.2Co-ordinationThe Client shall:a. coordinate and get or expedite any necessary approval and clearances relating to the work from any Government or Semi-Government Agency, Department or Authority, and other concerned organization named in the SC.b. coordinate with any other Inspection Firm employed by him.5.1.3ApprovalsThe Client shall accord approval of the documents within such time as specified in the SC, whenever these are applied for by the Inspection Firm.5.2Access to LandThe Client warrants that the Inspection Firm shall have, free of charge, unimpeded access to all land of which access is required for the performance of the Services.5.3Change in the Applicable LawIf, after the date of this Contract, there is any change in the Applicable Law which increases or decreases the cost of the Services rendered by the Inspection Firm, then the remunerations and direct costs otherwise payable to the Inspection Firm under this Contract shall be increased or decreased accordingly, and corresponding adjustment shall be made to the amounts referred to in Sub-Clause 6.2 (a) or (b), as the case may be.5.4Services and FacilitiesThe Client shall make available to the Inspection Firm, Sub-Contractors and the Personnel, for the purpose of the Services and free of any charge, the services, facilities and property described in Appendix F at the times and in the manner specified in said Appendix F, provided that if such services, facilities and property shall not be made available to the Inspection Firm as and when so specified, the Parties shall agree on; (i) any time extension that it may be appropriate to grant to the Inspection Firm for the performance of the Services; (ii) the manner in which the Inspection Firm shall procure any such services, facilities and property from other sources; and (iii) the additional payments, if any, to be made to the Inspection Firm as a result thereof pursuant to Clause 6 hereinafter.5.5PaymentsIn consideration of the Services performed by the Inspection Firm under this Contract, the Client shall make to the Inspection Firm such payments and in such manner as is provided by Clause 6 of this Contract.

6. PAYMENTS TO THE INSPECTION FIRM6.1Lump Sum RemunerationNot Used6.2Contract PriceThe SC shall specify the break up of remuneration to be paid to the Inspection Firm and the currencies.6.2.1 For comparison of financial bids, the US$ amount will be converted into Pak Rupees. 6.2.2 The rate of exchange shall be the selling rate, as notified by the State Bank of Pakistan prevailing on the date of opening of technical bids.6.2.3 The man-months and man-days are estimated. Requirement for each task assigned during the contract period will be mutually determined between Client and Inspection Firm prior to commencement of the task. The increase in the total contract amount shall not exceed 15% of the annual estimated contract amount.6.2.4 There shall be no price escalation during the 1st contract year. Any escalation in the subsequent years shall be agreed mutually prior to the extension in the contract.

6.3Terms and Conditions of PaymentPayment will be made to the account of the Inspection Firm and according to the payment schedule stated in the SC. Payments shall be made after the conditions listed in the SC for such payments have been met, and the Inspection Firm have submitted an invoice to the Client specifying the amount due.

6.4Period of PaymentAny other amount due to the Inspection Firm shall be paid by the Client to the Inspection Firm within thirty (30) days in case of local currency and forty five (45) days in case of foreign currency after the Inspection Firm' invoice has been delivered to the Client.6.5Delayed PaymentsIf the Client has delayed payments beyond the period stated in paragraph (b) of Sub-Clause 6.4, financing charges shall be paid to the Inspection Firm for each day of delay at the rate specified in the SC.6.6Additional ServicesAdditional Services means:a. Services as approved by the Client outside the Scope of Services described in Appendix A;b. Services to be performed during the period extended pursuant to Sub-Clause 2.6, beyond the original schedule time for completion of the Services; andc. Any re-doing of any part of the Services as a result of Client's instructions.If, in the opinion of the Client, it is necessary to perform Additional Services during the currency of the Contract for the purpose of the Project, such Additional Services shall be performed with the prior concurrence of both the Parties. The Inspection Firm shall inform the Client of the additional time (if any), and the additional remuneration and reimbursable direct costs expenditure for such Additional Services. If there is no disagreement by the Client within two weeks of this intimation, such additional time, remuneration and reimbursable direct costs expenditure shall be deemed to become part of the Contract. Such remuneration and reimbursable direct costs expenditure shall be determined on the basis of rates provided in Appendices D and E, in case the Additional Services are performed during the scheduled period of the Services, otherwise remuneration for Additional Services shall be determined on the basis of Inspection Firm' billing rates prevailing at the time of performing the Additional Services.6.7Inspection Firm' Entitlement to Suspend ServicesIf the Client fails to make the payment of any of the Inspection Firm' invoice (excluding the advance payment), within twenty-eight (28) days after the expiry of the time stated in paragraph (b) of Sub-Clause 6.4, within which payment is to be made, the Inspection Firm may after giving not less than fourteen (14) days' prior notice to the Client, suspend the Services or reduce the rate of carrying out the Services, unless and until the Inspection Firm have received the payment.This action will not prejudice the Inspection Firm entitlement to financing charges under Sub-Clause 6.5.7. SETTLEMENT OF DISPUTES7.1Amicable SettlementThe Parties shall use their best efforts to settle amicably all disputes arising out of or in connection with this Contract or its interpretation.7.2Dispute SettlementAny dispute between the Parties as to matters arising pursuant to this Contract which cannot be settled amicably within thirty (30) days after receipt by one Party of the other Party's request for such amicable settlement may be submitted by either Party for settlement in accordance with the provisions of the Arbitration Act, 1940 (Act No.X of 1940) and of the Rules made thereunder and any statutory modifications thereto.Services under the Contract shall, if reasonably possible, continue during the arbitration proceedings and no payment due to or by the Client shall be withheld on account of such proceedings.8. INTEGRITY PACT8.1 If the Inspection Firm or any of his Sub-ContractorInspection Firm, agents or servants is found to have violated or involved in violation of the Integrity Pact signed by the Inspection Firm as Appendix-G to this Form of Contract, then the Client shall be entitled to:a. recover from the Consultant an amount equivalent to ten times the sum of any commission, gratification, bribe, finders fee or kickback given by the Inspection Firm or any of his Sub-Contractor, agents or servants;b. terminate the Contract; andc. recover from the Inspection Firm any loss or damage to the Client as a result of such termination or of any other corrupt business practices of the Inspection Firm or any of his Sub-Contractor, agents or servants.On termination of the Contract under Sub-Para (b) of this Sub-Clause, the Inspection Firm shall proceed in accordance with Sub-Clause 2.9.3. Payment upon such termination shall be made under Sub-Clause 2.9.4 (a) after having deducted the amounts due to the Client under Sub-Para (a) and (c) of this Sub-Clause.

III. SPECIAL CONDITIONS OF CONTRACT

1.1Definitions"Assignment" Sui Southern Gas Company (SSGC) in order to carry out its business procures various type of material, equipment and services. SSGC intends to improve its performance and to verify conformance to applicable standards by introducing third party inspection/technical audit of its various activities/functions.

1.6Authorized RepresentativesThe Authorized Representatives are the following:For the Client:Rahat K. SiddiquiDy. Managing Director (Operations)Sui Southern Gas Company LimitedTelephone: +92 21 92231555Facsimile: +92 21 99231605E-Mail: rahat.kamal@ssgc.com.pkTo be filled in by Inspection Firm:_______________________________ (Name of Inspection Firm firm)___________________________ (Name of Project Manager)_______________________________ (Project)_______________________________ (Registered Address)______________________________________________________________Telephone: ___________________Facsimile: ___________________E-Mail: ___________________

1.7Taxes and Duties Inspection Firm shall include all prevailing duties / taxes in its quoted price. Exclusion of taxes will deem to be included in the offered price. In case of double taxation treaty between Pakistan and Inspection Firm country, the exemption shall be arranged by the Inspection Firm.1.8Leader of the Joint Venture The leader of the Joint Venture is --------------------------------------------- [to be filled in by the Inspection Firm].1.9Performance BondA performance bond of Rs. 1,000,000 in favour of SSGC shall be submitted by the inspection firm, which may be in the form of bank draft/pay order/bank guarantee from a scheduled bank operating in Pakistan.2.1Effectiveness of ContractThe date on which this Contract shall come into effect is the date when the Contract is signed by both the Parties, or any other date as agreed by the Parties.2.2Termination of Contract for Failure to Become EffectiveThe time period shall be one (1) year extendable each year based on Inspection Firms performance for a total term not exceeding three (03) years. 2.3Commencement of ServicesThe Inspection Firm shall commence the Services within fifteen (15) days after the date of signing of Contract Agreement or as agreed between the parties during pre award meeting.2.4Expiration of ContractThe duration of the contract for the Services as estimated by the Client, is as under; however Inspection Firm shall assess the time requirements based on their proposal (which shall be consistent with the achievement of assignment objectives) from the commencement date of the Services.

3.5Insurance to be taken by the Inspection Firm.Inspection Firm shall obtain insurance as per prevailing law.3.6Inspection Firm' Actions Requiring Client's Prior Approval In accordance with GC. 3.8Documents Prepared by the Inspection Firm to be the Property of the ClientThe Inspection Firm shall not use these documents for purposes unrelated to this Contract without the prior written approval of the Client.5.1.1Assistance by Client To be mutually discussed and agreed during the pre award meeting.5.1.2Coordination The Client shall coordinate and provide assistance in accordance with the GC.5.1.3ApprovalsThe Client shall accord approval of the documents immediately but not later than fourteen (14) days or any other mutually agreed time from the date of their submission by the Inspection Firm.6.1Remuneration The estimated remuneration amount (total A+B in the table of Appendix E Schedule of rates and contract price) based on Contract Prices quoted in 6.2, is as under:.,6.2Contract PricesThe contract price shall be based on the rates provided by the inspection firm in the appendix E schedule of rates and contract price.

6.3Terms and Conditions of Paymenta) Inspection Firm to propose a Payment Schedule corresponding to the deliverables/milestones, which will be discussed and finalized in the pre-award meeting. 6.4Period of Payment The Inspection Firm shall submit their invoice in duplicate to the Client, along-with supporting documents, where ever applicable, which shall be paid by the Client within 30 days.

IV APPENDICES

Appendix-A

Description of Services

A.BackgroundSui Southern Gas Company (SSGC) is Pakistans leading integrated gas utility company with a 2.6 million customer base in its franchise area across two provinces (Sindh and Balochistan) of Pakistan. SSGC is engaged in the business of transmission and distribution of natural gas as well as the conduction of high-pressure transmission and low-pressure distribution system. SSGCs high pressure infrastructure comprises 3,400 km long high pressure transmission network and 50,000 HP compression capacity. During 2012-2013 an average 1,100 MMCFD of gas was sold to the industrial commercial and domestic consumers, through a distribution network of over 40,000 km. SSGC also owns and operates the only gas meter manufacturing plant in the country, having an annual production capacity of over 750,000 gas meters.B.Scope1. Development & Inspection (D&I) Shop (Work Package 1)SSGC has developed the following items through local vendors, which were formerly imported:1. Service tee (3/4)2. Fittingsi. Swivel and nut assemblyii. Union, elbow, reducer, bushing, caps, tees, plugs, sockets and hexagonal nipplesiii. Pipe clamps (brackets) , , 1 , 1 , and 2iv. High pressure screwed socket ( to 1)v. Barrel Nipples ( , , , 1 and 2)vi. Meter lock cock3. Valvesi. Insulating union service valve ( x .)ii. Ball valves ( to 2 )iii. Needle valves ( ) 4. Gas regulatorsi. diameter domestic service regulatorii. High pressure regulatorThe D&I shop conducts the inspection of the above items for conformity assessment prior to its acceptance at stores. The acceptance sampling of the received items is carried out on the basis of ISO 2859-1:1999 Part-1.

Test & inspection of the material is carried out in accordance with specified procedures for each type of material. The material is inspected for physical defects, leakages and for meeting the performance and Quality requirements.

1. Physical inspection is carried out 100%.1. Leak testing / performance testing is carried out on lot samples basis according to sample plan specified by ISO-2859-1 (1999) - Acceptable Quality Limit (AQL). Details attached as annexure A-1.1. The leakages, performance and strength tests are carried out on testing units available at D&I Shop for the respective material. Pressurized air is used as a medium for carrying out leakage and performance tests.1. The threads shall be inspected based on API Spec 5B. Specification for Threading, Gauging and Thread Inspection of Casing, Tubing and Line Pipe Threads1. Material chemical composition analyses are carried out through outside agencies as considered necessary, on sample randomly selected from the lot supplied in order to determine the compliance of specific grade of material required.The tests of the items are carried out as per the following procedures: 4. Service Valve and Pressure Regulators (Domestic & High Capacity)

a. Service ValvePhysical Inspection (100%) a) Threads of the valve are checked for damages, no. of threads, & tight or loose threading.b) Checked for pin holes and casting defects. c) Insulation joint is checked.Leak Testinga) Valves are leak tested at 100 psig pressure. Gas should not leak from body /bonnet and insulated part of the valve. b) Plug torque of the valve is checked. The valve should open and close at 35 ft-lbs. force. c) Valve's outlet is plugged and 120 psig pressure is applied at inlet, the leakage is checked by applying foam /soap water. It should not leak at valve plug, insulation and the body.Bend TestAfter conducting the leakage test, plug is opened and a 2.2 feet long rod is inserted in the outlet and five plates weighing 20 lbs each are placed on it. The valve and especially insulated part should not leak at this bending force of 220 ft-lbs.b. Pressure Regulator (Domestic & High Capacity)Physical Inspection: (100%)a) Threads are checked for any damages, no. of threads, & loose / tight threading.b) Checked for any casting defects, finishing and pinholes, body seal nut, vent connections.c) Inlet and outlet sizes.Leak / Performance Testing:a) Performance as well as leak testing of the Regulators is carried out at different pressures i.e. 60 psi, 40 psi and 10 psi.b) Checked for gas venting arrangement, activation at the required water column.

4. Service Tee and other fittings

a. Service TeePhysical Inspection (100%)

a) Female and male threads of the Tee are checked for any damages, no. of threads & tight or loose threading. b) Female and male threads of the Brass Plug are checked for damages. c) Checked for any casting defects and pin holes. d) Checked for the required beveling angle (30 - 35).

Leak TestingThe lot is tested on random basis at a pressure of 100 psig for any leakage. During this process there should be no leakage from the body and plug of the Service Tee.b. Swivels & Plate AssemblyPhysical Inspection (100%)a) Threads of the Nut and Swivel are checked for any damages, no. of threads & loose/tight threading.b) Check to find out any casting defects and pin holes. c) Finishing of the threads are checked using thread gauge.

Leak TestingLeak test is conducted at a pressure of 3 psig. Coupling nuts and assembly should show any leakage.

c. Pipe Fittings (Elbows, Unions, Bushes, Plugs, Sockets. Hex. Nipples, Pipe Clamp, Red. Tees/Elbows, Couplings)Physical Inspection: (100%)a) Threads are checked to find out any damages, no. of threads, loose/tight threading.b) Checked for any casting defects.c) Checked for pinholes and body finish condition.

4. Ball Valves / NeedleValves

Physical Inspection: (100%)a) Threads of the valve arc checked for damages, no. of threads, & tight or loose threading.b) Checked for pin holes and casting defects.Leak Testing:a) Valves are checked at 350 - 400 psig pressure. Gas should not leak from body/bonnet & seals.b) Torque equipment of the valve is checked. The valve should open and close at 35 ft-lbs force.

2. Meter Plant (Work Package 2)

The audit of meters manufactured at Manufacturing Plant shall be based on BS EN 1359:1999 Gas Meters Diaphragm gas meters encompassing following major areas:

1.Test protocols to be conducted by 3rd party laboratory on new manufactured meters

2.Meters (G1.6 & G4) to be tested should be new manufactured meters. The aim is to ensure that calibration of new manufactured meters is correct and to identify metrology problems in meters in the field that can affect billing. Beside it is important to and link failures with root causes.`The meters should be tested the following points:a.Percentage error and pressure loss in meters to be tested at:i. Maximum flowii. 0.7 Maximum flowiii. 0.4 Maximum flowiv. 0.2 Maximum flowv. 0.1 Maximum flowvi. 3 x Minimum flowvii. Minimum flowb.Cause analysis of meters out specifications.(if possible to be performed by the 3rd party lab)c.Improvements recommendations (if possible to be performed by the 3rd party lab)3.Metrological control, cause analysis and conclusion.Condition 1: G1.6 and G4 field meters.Description: To collect random field samples from each pressure profile segment (High Pressure Profile, Medium Pressure Profile, Nil Pressure Profile) with assumed field returns findings identified as (nil consumption, passing unregistered gas, minimum), in addition to normal consumption. Condition 2: G1.6 and G4 meters (collected from field, from production lines)Description: To collect 2 meters G4 and G1.6 (each) from the field where pressure profiling does not apply with assumed field returns findings identified as (nil consumption, passing unregistered gas, minimum consumption) + normal consumption, total quantity is 16 in total

3. Mills Inspection (Work Package 3)The inspection of mills shall be as per API 5L:2013 Specification for Line Pipe comprises the following areas:a. Manufacturing process inspectioni. Steel coil/plate de-stackingii. Edge milling of steel platesiii. Roll bending of steel platesiv. Edge post-bendingv. Continuous root weldingvi. Weld on tapsvii. Internal weldingviii. External Weldingix. Inspection of surfacex. Final inspection measuring and weighingxi. Beveling of pipe endsb. Pipe inspectionMill inspection and loading supervision of steel linepipe shall include but not be limited to the following tests and inspections as applicable:a) Gradeb) Qualityc) Type and Process of manufactured) The material from which the Linepipe is manufacturede) Chemical and check analysisf) Diameter, weight and length of each pipe as per ANSI B36.10 Basic dimensional standard for all steel pipeg) Wall thickness and bevel anglesh) Hydrostatic mill tests and bursting testsi) Other Physical properties including charpys v notch testj) Non-destructive testing and inspectionk) Repair of defects including retestsl) Markingm) Quantityn) Surface preparation & Coating process execution.o) Coating thickness.p) Coating physical properties test.q) Coating raw material product used, name of manufacturers, type, batch number and date of manufacturer of the product.r) Other inspection requirements will be determined as contained in the Line pipe order/contracts.

4. Distribution Pipeline Construction (Work Package 4)

The scope of inspection will include the following activities as per ASME B31.8 Gas Transmission and Distribution Piping:a. Ditching/backfilling activities for pipeline laying as per SOP attached as annexure A-2 a. Ditching depth and widthb. Ditch prepared without damaging other utilitiesc. Soft padding d. Brick laying for the protection of polyethylene (PE) pipe layinge. Laying of caution/warning over the pipef. Proper backfilling b. Steel pipe laying as per SOP attached as annexure A-3 (work package 4.2)a. Pipe loading/unloading and stacking b. Safety of protective coatingc. Cleaning and beveling of welding joints (welding preparation)d. Welding as per API 1104 Welding of Pipelines and Related Facilitiese. Proper handling of pipe (raising, lowering) to avoid pipe deformation and/or coating damagef. Cleaning/air pigging of pipe before commissioningc. Polyethylene (PE) pipe laying as per SOPs attached as annexure A-4 and A-5

a. Proper cleaning of pipe jointsb. Pipe edges cut in square shapec. Proper squeezing of pipe for butt jointd. Proper time for joint cool off (joint formation)e. Removal of undue stresses during cool-offThe following standards are applicable to the above procedure:ASTM F714: Standard Specification for Polyethylene (PE) Plastic Pipe (SDR-PR) Based on Outside Diameter. ISO 4437 : Buried pipeline for supply of gaseous fuelsASTM D3035: Standard Specification for Polyethylene (PE) Plastic Pipe (DR-PR) Based on Controlled Outside Diameter.ASTM F2620-06: Standard Practice for Heat Fusion Joining of Polyethylene Pipe and FittingsASTM D2683: Standard Specification for Socket-Type Polyethylene Fittings for Outside Diameter-Controlled Polyethylene Pipe and Tubing.ASTM D3261: Standard Specification for Butt Heat Fusion Polyethylene (PE) Plastic Fittings for Polyethylene (PE) Plastic Pipe and Tubing.ASTM D3350: Standard Specification for Polyethylene Plastic Pipe and Fittings Materials.ASTM F1055: Standard Specification for Electrofusion Type Polyethylene Fittings for Outside Diameter Controlled Polyethylene Pipe and Tubing.d. Pipeline coating as per SOP attached as annexure A-6 a. Excavation of pipeb. Removal of old / deteriorated coating c. Cleaning after removal of old coating carried out by means of sand blast/grit blasting/any other tools where sandblasting is not possibled. Application of primere. Coating application (tape / hot enamel)f. Backfilling

The following standards are applicable to the above procedure:

NACE No. 1/SSPC-SP 5, White Metal Blast CleaningNACE No. 2/SSPC-SP 10, Near-White Metal Blast Cleaning6A100, Coatings Used in Conjunction with Cathodic ProtectionSP0169-2007, Control of External Corrosion on Underground or Submerged Metallic Piping SystemsSP0109-2009, Field Application of Bonded Tape Coatings for External Repair, Rehabilitation, and Weld Joints on Buried Metal Pipelines

5. Meter installation and service connection as per SOPs attached as annexure A-7 and A-8 (work package 5):

a. Meter installation (as per SOP attached as annexure A-7)a. Meter installation to be atleast 3 feet away from electric wiring / electricity meterb. U-bend pipe joints from service riser to meter inlet and meter outlet to customer gas connectionc. Proper clamping of pipe with the wall of customer premisesd. Maintenance of horizontal level of meter and removal of undue stress on service pipinge. Soap-water solution test of threaded joints to ensure leak-free connectionb. Service connection (as per SOP attached as annexure A-8)a. Service connection at 90 degrees to the feeder/main line b. Proper cleaning of joint before welding service teec. Proper welding of service tee and time given to cool off the welded jointd. Connection to be drilled with T-drilling machinee. Service riser must be straightf. Service connection to be away from sewerage line and electricity connectiong. Proper plugging and capping of service tee after drillingh. Proper coating of service tee and jointC.Invitation of BidsBids are accordingly invited from well-reputed engineering inspection firms having experience relevant to the required services mentioned above. The Client requires the Inspection Firm to provide professional, objective and impartial informed judgment services at all times. The Inspection Firm will hold Clients interests paramount, avoid conflicts with other assignments or their own corporate interests, and act without any consideration for future work. The Inspection Firm shall identify the risks and obligations under each category of the assignment.

The Inspection Firm shall comply with all local laws.Evaluation of ProposalsThe technical proposals of bidders (Envelope-1) will be evaluated on the basis of: Experience of the Inspection Firm during the last five (05) years relevant to the proposed services. Qualification and competence of the key professionals/experts proposed for the required services. The quality and adequacy of the proposed methodology, and deliverables.

The evaluation of financial proposals to determine the lowest bidder among the qualified bidders, shall be based on the total estimated quoted fee as per Clause 6.1 and 6.2 of Special Conditions.

Acceptance Quality Limit (AQL) is based on ISO 2859-1 : 1999 - Part-1

SINGLE SAMPLING PLAN

FOR NORMAL / REDUCED / TIGHTENED

S.NO.LOT / BATCH SIZESAMPLE SIZEACCEPTANCE QUALITY LIMIT

ACCEPTED (NO.)REJECTED (NO.)

12 to 8Normal201

Reduced201

Tightened301

29 to 15Normal301

Reduced201

Tightened501

316 to 25Normal501

Reduced201

Tightened801

426 to 50Normal801

Reduced201

Tightened1312

551 to 90Normal1312

Reduced201

Tightened2012

691 to 150Normal2012

Reduced301

Tightened3212

7151 to 280Normal3212

Reduced512

Tightened5023

8281 to 500Normal5034

Reduced812

Tightened8034

9501 to 1,200Normal8056

Reduced1312

Tightened12556

101,201 to 3,200Normal12578

Reduced2012

Tightened20089

113,201 to 10,000Normal2001011

Reduced3223

Tightened3151213

1210,001 to 35,000Normal3151415

Reduced5034

Tightened5001819

1335,001 to 150,000Normal5002122

Reduced8056

Tightened8001819

14150,000 to 500,000Normal8002122

Reduced12578

Tightened12501819

15500,001 and overNormal12502122

Reduced201011

Tightened20001819

Appendix B

Reporting Requirement

Inspection Firm shall include the reporting/submission requirements in its Technical Proposal which will be discussed and finalized in pre-award meetings.

Appendix C

Key Personnel and Sub-Contractors

To be submitted by Inspection Firm

C-1Title [and names], activities or job descriptions of key Personnel to be assigned to work and staff-months/days for each.

C-2 List of approved Sub-Contractors (if already available); same information with respect to their Personnel as in C-1 above.]

Appendix D

[Not used]

Appendix E

Schedule of Rates and Contract Price

Inspection Firm to fill in the rates and man-day rates below:Sr. #Work Package UnitRateEstimated quantity *Cost

1WP-1:Development & inspection (D&I) shop Lump sum-30

2WP-2: Meter PlantLump sum5

3WP-3: Mills inspectionLump sum5

4WP-4: Distribution pipeline inspection Lump sum-30

4dWP-5: Domestic service connection and meter installationLump sum100

Total

*The quantities shown above are estimated for one year. The increase in the total contract value however, shall not exceed 15% of the annual estimated contract value.

Table for Man-day Rates

Sr. #Assigned Resources Man-day rate Estimated Man-daysCost

1.Assignment Leader/Focal Person

2.Associates

3.Senior Inspector

4.Junior Inspector

5.Senior Technical Professional / Expert (local)

6.Junior Technical Professional / Expert(local)

Note:This appendix will be used for determining remuneration for Additional Services in accordance with Sub-Clause GC 6.6.]

Appendix F

[Not Used]

Appendix G

(INTEGRITY PACT)DECLARATION OF FEES, COMMISSION AND BROKERAGE ETC.PAYABLE BY THE SUPPLIERS OF GOODS, SERVICES & WORKS IN CONTRACTS WORTH RS. 10.00 MILLION OR MORE

Contract No.________________ Dated __________________Contract Value: ________________Contract Title: _________________

[Name of Inspection Firm/ Supplier] hereby declares that it has not obtained or induced the procurement of any contract, right, interest, privilege or other obligation or benefit from Government of Pakistan (GOP) or any administrative subdivision or agency thereof or any other entity owned or controlled by GOP through any corrupt business practice.

Without limiting the generality of the foregoing, [Name of Inspection FirmInspection Firm/Supplier] represents and warrants that it has fully declared the brokerage, commission, fees etc. paid or payable to anyone and not given or agreed to give and shall not give or agree to give to anyone within or outside Pakistan either directly or indirectly through any natural or juridical person, including its affiliate, agent, associate, broker, consultant, director, promoter, shareholder, sponsor or subsidiary, any commission, gratification, bribe, finders fee or kickback, whether described as consultation fee or otherwise, with the object of obtaining or inducing the procurement of a contract, right, interest, privilege or other obligation or benefit in whatsoever form from GoP, except that which has been expressly declared pursuant hereto.

[Name of Inspection Firm /Supplier] certifies that it has made and will make full disclosure of all agreements and arrangements with all persons in respect of or related to the transaction with GoP and has not taken any action or will not take any action to circumvent the above declaration, representation or warranty.

[Name of Inspection Firm / Supplier] accepts full responsibility and strict liability for making any false declaration, not making full disclosure, misrepresenting facts or taking any action likely to defeat the purpose of this declaration, representation and warranty. It agrees that any contract, right, interest, privilege or other obligation or benefit obtained or procured as aforesaid shall, without prejudice to any other rights and remedies available to GoP under any law, contract or other instrument, be voidable at the option of GoP.

Notwithstanding any rights and remedies exercised by GoP in this regard, [name of Inspection Firm / Supplier] agrees to indemnify GoP for any loss or damage incurred by it on account of its corrupt business practices and further pay compensation to GoP in an amount equivalent to ten time the sum of any commission, gratification, bribe, finders fee or kickback given by [name of Inspection Firm / Supplier] as aforesaid for the purpose of obtaining or inducing the procurement of any contract, right, interest, privilege or other obligation or benefit in whatsoever form from GoP.

Name of Client/Buyer: Name of Inspection Firm /Supplier: Signature: Signature: [Seal][Seal]

SECTION-4

PRE QUALIFICATION REQUIREMENTS

FOR

APPOINTMENT OF INSPECTION FIRM FOR IMPROVEMENT IN CONSTRUCTION AND MATERIAL QUALITY

January 2014SUI SOUTHERN GAS COMPANY LIMITED

Evaluation CriteriaAssessment of capability (shortlisting) of Inspection Firms shall be as per following criteria:S-No.DescriptionTotal PointsDetailed criteria shown in

1Experience of the Inspection Firm in the last five (05) years as per Forms B-1 & B-2.30Table-1

2Qualifications of key professionals / experts available for the proposed assignments as per Form B-330Table-2

3Relevance of methodology for various types of proposed assignments as per Form B-420Table-3

4Accreditation with International/National bodies20Table-4

Minimum qualifying marks: 70The Inspection Firm shall submit the above information along-with documentary evidence.

Table-1 Experience of the Inspection Firm (in the last 5 years) Total Points 30CategoryTotal marks

1. Development & Inspection Shop 6

1. Meter Plant 6

1. Mills Inspection 6

1. Distribution Pipeline Construction6

1. Domestic service connection and meter installation6

The detailed scoring criteria are as under:1. 1 points each for relevant assignments completed1. 0.5 point each for other oil and gas assignments completed

Table-2: Key Professionals / Experts Total Points 30TotalAcademic5Experience20International5

1. Assignment Leader/Focal Person 1. Focal Person Associates1. Senior Inspectors / Technical Professional /Experts1. Junior Inspectors / Technical Professional Experts83910211142682-21

Percentage ratings

Resource DescriptionAcademicExperienceInternational

Assignment Leader/Focal Person Focal Person AssociatesSenior Inspectors / Technical Professional / ExpertsJunior Inspectors / Technical Professional / Experts100%100%100%100%100%100%100%100%100%100%100%100%

The score rating factors will be allocated based on the following criteria:1. Academic Qualifications1. Assignment Leader / Focal PersonSRF will be 85% Marks for Post-Graduate SRF will be 75% Marks for Graduate SRF will be 5% Marks for each certification course1. Focal Person Associates (average value will be taken for two or more resources provided)SRF will be 80% Marks for Graduate SRF will be 15% Marks for basic computer skills (proficiency in MS-Office applications)1. Senior Inspectors /Technical Professional / Experts (average value will be taken for two or more resources provided)SRF will be 80 % for Post-Graduate SRF will be 70 % for Graduate SRF will be 5 % for each certification course1. Junior Inspectors /Technical Professional / Experts (average value will be taken for two or more resources provided)SRF will be 80 % for Post-Graduate SRF will be 70 % for Graduate SRF will be 5 % for each certification course1. Experience1. Assignment Leader / Focal Person50 Marks for overall experienceSRF will be 50 % for over 25 years overall experienceSRF will be 40 % for 21 25 years overall experienceSRF will be 30 % for 16 20 years overall experienceSRF will be 20 % for 10 15 years overall experience50 Marks for relevant experienceSRF will be 50 % for over 20 years of relevant experienceSRF will be 40 % for 15 20 years of relevant experienceSRF will be 30 % for 10 14 years of relevant experienceSRF will be 20 % for 5 9 years of relevant experienceSRF will be 10 % for 0 4 years of relevant experience1. Focal Person Associates (average value will be taken for two or more resources provided)SRF will be 100 % for over 10 years overall experienceSRF will be 80 % for 7 9 years overall experienceSRF will be 60 % for 4 6 years overall experienceSRF will be 40 % for 0 4 years overall experience1. Senior Inspectors /Technical Professional / Experts (average value will be taken for two or more resources provided)50 Marks for overall experienceSRF will be 50 % for over 20 years overall experienceSRF will be 40 % fo SRF will be 16 19 years overall experienceSRF will be 30 % for 10 15 years overall experienceSRF will be 20 % for 7 10 years overall experience50 Marks for relevant experienceSRF will be 50 % for over 15 years of relevant experienceSRF will be 40 % for 10 14 years of relevant experienceSRF will be 30 % for 7 9 years of relevant experienceSRF will be 20 % for 5 7 years of relevant experienceSRF will be 10 % for 0 4 years of relevant experience1. Junior Inspectors /Technical Professional / Experts (average value will be taken for two or more resources provided)50 Marks for overall experienceSRF will be 50 % for over 18 years overall experienceSRF will be 40 % for 15 18 years overall experienceSRF will be 30 % for 10 14 years overall experienceSRF will be 20 % for 5 9 years overall experience50 Marks for relevant experienceSRF will be 50 % for over 15 years of relevant experienceSRF will be 40 % for 10 14 years of relevant experienceSRF will be 30 % for 6 9 years of relevant experienceSRF will be 20 % for 5 8 years of relevant experienceSRF will be 10 % for 0 4 years of relevant experience1. International1. Assignment Leader / Focal PersonSRF will be 100 % for 10 years of working on international assignmentsSRF will be 85 % for 7 years of working on international assignmentsSRF will be 70 % for 5 years of working on international assignments1. Focal Person Associates (average value will be taken for two or more resources provided)SRF will be 100 % for 4 years of working on international assignmentsSRF will be 85 % for 2-3 years of working on international assignmentsSRF will be 70 % for 1 years of working on international assignments1. Senior Inspectors /Technical Professional / Experts (average value will be taken for two or more resources provided)SRF will be 100 % for 8 years of working on international assignmentsSRF will be 85 % for 5 years of working on international assignmentsSRF will be 70 % for 3 years of working on international assignments1. Junior Inspectors /Technical Professional / Experts (average value will be taken for two or more resources provided)SRF will be 100 % for 5 years of working on international assignmentsSRF will be 85 % for 3 years of working on international assignmentsSRF will be 70 % for 1 years of working on international assignments

Calculation of Marks2. Assignment Leader/Focal Person

Total Marks Obtained = (Percentage of Academic x 2) + (Cumulative Percentage of Experience x 4) + (Percentage of International Experience x 2)

2. Associates

Total Marks Obtained = (Average Percentage of Academic x 1) + (Average Percentage of Experience x 2)

2. Senior Inspectors /Technical Professional / Experts

Total Marks Obtained = (Average Percentage of Academic x 1) + (Average of Cumulative Percentage of Experience x 6) + (Average Percentage of International Experience x 2)

2. Junior Inspectors /Technical Professional / Experts

Total Marks Obtained = (Average Percentage of Academic x 1) + (Average of Cumulative Percentage of Experience x 8) + (Average Percentage of International Experience x 1)

Table-3 Relevance of Proposed Methodology Total Points 20 Scoring CriteriaPoints Allocated20

1. Too little information provided

1. Information provided shows a significant deficiency against assignment requirements

1. Information provided shows a serious deficiency against assignment requirements

1. Information provided is adequate but still shows a significant deficiency against project requirements

1. Information provided is adequate to permit full analysis but shows that there are minor deficiencies against project requirements

1. Information provided is adequate to conduct full analysis and shows that the proposed methodology is adequate to meet full assignment requirements

0

4

8

12

16

20

Table-4 Accreditation with International/National Bodies Total Points 20

CategoryTotal marks

1. More than 10020

2. Between 50-9910 15

3. Between 1-495 10

Form-B-1INFORMATION FORM

1. Name of Consultant [Lead partner, if association]1. Address1. Telephone No(s)1. Fax Number1. E-mail Address2. Description of consulting firm (ownership/organization)3. Experience (Number of Years)1. Local/national1. International4. Name(s) and Address (es) of Associates, if a JV; their short description and description of their role in the JV/Association.5. Experience of the Consultants (on appended B-3 form) during the past 5 years:6. Organization chart showing consultants structure.7. Financial standing of Consultant (Audited Financial Statements for the last three years).1. Subsidiaries and associates.1. Financial reference [ name/address of bank(s)]8. Professional staff proposed for the assignment on Form B-1.9. Additional information

Yours truly,Name of Authorized Representative:Position:Date:

Form B-2Assignment Completed by the Consultants in the last 5 years[along with documentary evidence]

[NAME OF THE FIRM/CONSULTANT]

1. Name of Assignment:2. Country:3. Name of Client:4. Address:5. Start Date: Month/Year6. Completion Date: Month/Year7. No. of Staff / professionals provided :8. Total Nos. of Staff Months:9.Approx: Value of Services / Assignments:10. Name of Other JV Firms (If any):11. No. of Staff/Staff Months Provided by the JV partner(s):12. Description of Project:13. Description of Services Provided by the Firm:Note: One form for each assignment. Additional information may be attached with the form.

Form B-3

Qualification & expertise of key professional staffproposed for the assignment

1.Name:2.Profession/Expertise:3.Date of Birth:4.Nationality:5.Years with the Firm:6. Languages anddegree of proficiency7.Experience:8.Membership of Professional Societies:9.Academic Qualification:10.Other Trainings:I, the undersigned, certify that, to the best of my knowledge and belief, these bio-data correctly describes myself, my qualifications and my experience.

Signature:

Dated:Note: Please fill one form for each expert. Additional information may be attached with the form.

Form B-4Proposed Methodology & Work Plan

Methodology The methodology shall include Inspection Firm's understanding of the project objectives, proposed consulting services envisaged to meet project objectives, approach to be adopted for carrying out the scope of services, methodology for carrying out related activities and the expected output and deliverables. Highlight anticipated issues/problems, challenges, their importance, and suggest approach to address them.Work PlanConsultant to submit a work plan for the main activities of the proposed taks assignments, their content and duration, phasing and interrelations, milestones (including interim approvals by the Client), and deliverables. The proposed work plan should be consistent with the technical approach and methodology, showing understanding of the scope of the work and ability to translate them into a feasible working plan. A list of the final documents, including reports, drawings, and tables to be delivered as final output, should be included here.

Section-3 Page 36