SPECIFIC REQUIREMENTS A. Time Management Procedures

CONTRACTOR's fundamental procedural document shall be the detailed work schedule submitted with its proposal and upgraded within sixty (60) days thereafter. CONTRACTOR shall issue this document as part of its Job

Procedures, maintain it accordingly, and update it to define the conduct of its Time Management function.

PAGE 2 OF 12 DATE: JULY 10, 2009

2. TIME MANAGEMENT

B. Techniques and Systems

Contractor shall utilize techniques of logic network diagramming within approved systems capable of utilizing such techniques (Primavera, MS Project, PERT Master, etc.) The specific approach - CPM, PERT, Precedence, etc. -- may be selected by Contractor subject to EMPLOYER approval. However, level of detail and description must be consistent with all work breakdown structuring and earned value reporting requirements (See Project Instruction Nº 15).

CONTRACTOR shall translate requirements and conditions of network diagrams into more manageable control mechanisms for its home office and field construction activities, e.g., daily or weekly worksheets and/or look-ahead schedules. Said mechanisms shall develop finite engineering (EWP) and construction (CWP) work packages and establish interim milestone dates for each major activity. Contractor shall review and amend these mechanisms weekly to ensure they accurately reflect material, personnel and equipment requirements and status. Schedule reports shall be provided to EMPLOYER Project Manager (or their designee) in hard copy and electronic (native file) formats.

C. Schedule Designations and Specifications

The time management function includes three (3) primary schedule designations relating to three (3) distinct phases of control schedule evolution/development, and three (3) secondary designations to denote significant transition points. These are identified as follows:

SD-1 Initial Project Management Plan (Level 1) SD-2 Design Specification Plan (Level 2) SD-3 Definitive Plan (Level 3)

SD-3FC Field Construction Plan SD-3MC Mechanical Completion Plan SD-3S Start-Up Plan

With each successive designation (primary or secondary) Contractor shall amplify level of detail and functional scope of the project schedule's supporting logic network diagrams to reflect available project definition and developing execution strategy. Timing and specifications for these designations are presented in Exhibits 2-1, 2-2, and 2-3. Said criteria however, represent minimum requirements of Contractor's effort. Accordingly, CONTRACTOR shall expand them as EMPLOYER’s Project Manager deems necessary to achieve the most effective coordination, surveillance, and control program to specific project circumstances.

(Schedule requirements for shutdown or revamp situations are addressed in Section III.I of this Instruction.)

PAGE 3 OF 12 DATE: JULY 10, 2009

2. TIME MANAGEMENT

D. Schedule Development

CONTRACTOR shall produce progressively-developed project schedules at the appropriate stages of project evolution in accordance with the General Provisions;

the criteria of Exhibits 2-1, 2-2, and 2-3; and the following requirements:

1. Should CONTRACTOR determine that the need exists to rework a schedule previously approved by EMPLOYER and issued by CONTRACTOR, Contractor shall not undertake said rework without EMPLOYER's prior approval.

2. CONTRACTOR shall submit all schedules to EMPLOYER’s Project Manager for review and approval and shall not release any schedule without EMPLOYER's prior approval.

E. Control and Maintenance

Contractor shall update the project schedule each month, or more often if required by EMPLOYER’s Project Manager. Schedule analysis and reconciliation shall be included in Monthly Progress Reports (See Project Instruction Nº 14) and shall highlight:

1. Summary of previous report and corrective/preventive measures taken, 2. Significant status changes during the present reporting period,

3. Measures proposed or initiated by Contractor for schedule adherence or time deficit recovery,

4. Summary projections of activities commencing and completing during the next reporting period,

5. Identification (by name) of those individuals charged with the responsibility for resolving present delays and potential problems, and timing for implementation of said actions.

F. Progress Reporting

In addition to monthly schedule status reports in Section III.E of this instruction, Contractor shall be required to provide EMPLOYER’s Project Manager with the following:

1. Individual progress and performance indices curves for engineering, procurement, and field construction for the entire project. The curves shall present projected and actual progress and be supported by similar curves for engineering discipline, each field construction direct craft, and each

PAGE 4 OF 12 DATE: JULY 10, 2009

2. TIME MANAGEMENT

subcontractor by unit or work area. (Development and maintenance of said curves shall be in strict accordance with work breakdown structure and earned value requirements of Project Instruction Nº 15 – Measurement of Percentage Completion).

2. Staffing profiles and Labor burden to support monthly progress projections including "recovery" situations. Representation of staffing requirements shall be consistent with curve development (i.e., by engineering, procurement, and field construction) as above.

3. Evidence that all available steps have been taken to maintain or better the Target Completion Date. This shall be repeated whenever any events that may jeopardize the schedule have taken place. CONTRACTOR shall take timely action to maintain predicted project schedule dates or to minimize delay including revision of work priorities, planned overtime, payment of premiums, and other means.

G. Performance Monitoring/Data Access

EMPLOYER’s Project Manager will require access to Contractor's field productivity data in order to be able to effectively monitor the execution of all phases of the project. These data include such information as budget hour and physical quantity estimates and adjustments, actual hours or work units expended and physical quantities installed, details of percent physical completion, estimated and actual unit productivity’s for each physical parameter used, productivity graphs and trend curves, and a complete explanation by CONTRACTOR of how CONTRACTOR compiles and uses the productivity data on a timely basis. CONTRACTOR will give EMPLOYER’s Project Manager access to all such data.

H. Time Management Effort Appraisal

CONTRACTOR shall conduct comprehensive appraisals of its time management effort via formal monthly and quarterly reviews of project status. The reviews shall be chaired by the Contractor's representative charged with the time management responsibilities for the project. In preparing for each review, this representative shall undertake a complete assessment of the schedule. This assessment will note problems (and their resolution), changes, accomplishments, strategy modification, etc. during the period since the last update. Following are typical relevant topics or areas to be addressed:

1. CONTRACTOR/ EMPLOYER/third party interfaces and relationships, 2. Input data relevance and validity,

3. Timeliness and quality of output data,

PAGE 5 OF 12 DATE: JULY 10, 2009

2. TIME MANAGEMENT

4. Information gathering and dissemination,

5. Contingency planning and required development time for same, 6. Time deficit recovery planning and reaction time,

7. Trending and analysis, 8. Project status updating,

9. Schedule risk analysis program.

I. Shutdown Scheduling (if applicable)

1. CONTRACTOR shall appoint a Shutdown Coordinator whose responsibilities are to include all phases of shutdown program as discussed herein. He/she is to serve as direct point of contact with designated personnel regarding all considerations pertaining to shutdown planning and execution. No other work assigned to Shutdown Coordinator shall take priority over shutdown-related work.

2. CONTRACTOR shall prepare a detailed plan and schedule for each planned shutdown. Said plan and schedule shall be prepared in close cooperation with EMPLOYER's designated personnel, and shall be completed and submitted for EMPLOYER's review and approval three months in advance of the planned shutdown date. EMPLOYER will specify planned shutdown dates and shutdown durations for scheduling purposes. Scope of shutdown plan and schedule shall cover all shutdown work on the facility involved whether such work is anticipated to be performed by CONTRACTOR, by EMPLOYER, or by others. Schedule shall be in a format (arrow diagrams, bar charts, combo, etc.) agreed by EMPLOYER and shall show downtime work program by shifts and in hourly increments. Level of detail of work breakdown shall be consistent with the foregoing increments. Shutdown plan shall include the following:

a. Itemization and timing of all pre-shutdown work required to achieve minimum downtime

b. Itemization of timing of all work required to be accomplished during downtime

c. Division of responsibilities

d. Resource and other requirements for each item plus any additional

"common" resources or other requirements. Resource and other requirements would include:

PAGE 6 OF 12 DATE: JULY 10, 2009

2. TIME MANAGEMENT

• Construction drawings

• Construction tools and equipment

• Construction supplies

• Labor (by craft)

• Materials

• Supervision

• Temporary facilities

• Communications

• Etc.

e. Time line summary of all resource and other requirements

f. Identification of schedule risk areas together with an appropriate contingencies plan to minimize adverse impact on downtime.

3. Shutdown reporting, beyond what is required elsewhere in this instruction shall begin as soon as EMPLOYER has agreed with Contractor's detailed shutdown plan and schedule. Contractor shall continuously maintain current master copy mark-up of shutdown plan and schedule. Reporting shall be primarily accomplished by weekly or daily shutdown planning meetings at Site, attended by designated EMPLOYER and CONTRACTOR personnel and others if required.

a. Prior to shutdown, weekly planning meetings will be held. Contractor will present the master copy mark-up for review and will identify any item whose status is unsatisfactory. At the conclusion of the meeting, Contractor will immediately issue an "Exceptions List" specifying corrective action responsible person, and required timing.

b. During shutdown, daily planning meeting will be held to review CONTRACTOR's master schedule mark-up, identify problem areas, and agree on following day's work program (including corrective action). At the conclusion of meeting, CONTRACTOR will immediately prepare and issue detailed work program for next day reflecting any agreed on correction action.

c. CONTRACTOR will immediately advise EMPLOYER of any situation that might prevent shutdown objectives from being met.

PETROPERU S.A. VO TALARA REFINERY MODERNIZATION PROJECT PROJECT INSTRUCTIONS TO FEED-EPC CONTRACTOR IFP SERVICES AND DELIVERABLES - FEED MASTER JOB SPECIFIC PAGE EX PAGE DATE: JULY EXHIBIT 2-1 PROJECT SCHEDULE DESIGNATIONS International Bidding Process N° PCI-002-2008-OFP/PETROPERU DESIGNATION DESCRIPTION RESPONBILITY/TIMING PRESENTATION/FUNCTION SD-1 Initial Project Management Plan

For RC Projects, to be prepared by Contractor within time period specified in MJS.

• Presented in logic network format on time scale. • Serves as initial overview to identify: Project execution implications inc primary interdependencies and internal/external restraints. Activities of project participants – Company, Contractor, Governmental Authorities, an others – and required timing of these activities. SD-2 Design Specification Plan

To be prepared by Contractor for each Basic Design Package (for which detailed engineering is less than 15% complete) consistent with SD-1 logic and durations. (See Exhibit 2-2 for timing.)

• Developed utilizing an approved logic network diagramming technique f maintenance by EDP methods. • Provides maximum visibility and control on al item-by-item basis for eac Basic Design Specification. SD-3Definitive PlanTo be prepared by Contractor based on SD-2 development. • Consistent with SD-2 development, utilizes an approved logic network diagramming technique (60 day and two week look-aheads to be issued f planning/ coordination of work) for maintenance by EDP methods. • Continues SD-2’s visibility/control philosophy and, in addition, emphasiz the detailed engineering and procurement areas.

PETROPERU S.A.VO TALARA REFINERY MODERNIZATION PROJECT PROJECT INSTRUCTIONS TO FEED-EPC CONTRACTOR IFP SERVICES AND DELIVERABLES - FEED MASTER JOB SPECIFIC PAGE EX PAGE DATE: JULY EXHIBIT 2-1 PROJECT SCHEDULE DESIGNATIONS International Bidding Process N° PCI-002-2008-OFP/PETROPERU SD-3FC Field Construction To be prepared by Contractor prior to 30% completion point of detailed engineering and/or effective field construction initiation.

• Consistent with SD-2 development, utilizes an approved logic network diagramming technique for maintenance by EDP methods. • Continues SD-2’s visibility/control philosophy. In addition, emphasized f construction sequence stressing the first 50% activities. SD-3MC Mechanical Completion Plan

To be prepared by Contractor prior to 85% completion point of detailed engineering and/or approximately 50% completion point of field construction

• Consistent with SD-2 development, utilizes an approved logic network diagramming technique for maintenance by EDP methods. • Continue SD-2’s visibility/control philosophy. Also begins transition to s up emphasis by highlighting last 50% field activities and developing concentration upon process systems SD-3S Start-up Plan To be prepared jointly by EMPLOYER and CONTRACTOR prior to 75% completion point of field construction. During Pre- commissioning/ Commissioning, CONTRACTOR shall participate in start-up meetings.

• Consistent with SD-2 development, utilizes an approved logic network diagramming technique for maintenance by EDP methods. • Continues SD-2’s visibility/control philosophy and fully completes transit to start-up stage begun with SD

PETROPERU S.A.VO TALARA REFINERY MODERNIZATION PROJECT PROJECT INSTRUCTIONS TO FEED-EPC CONTRACTOR IFP SERVICES AND DELIVERABLES - FEED MASTER JOB SPECIFIC PAGE EX PAGE DATE: JULY TIME MANAGEMENT EXHIBIT 2-2 SPECIFICATIONS FOR ACTIVITY LEVELS PROJECT SCHEDULE ACTIVITY TOTAL AND FUNCTIONAL DISTRIBUTION International Bidding Process N° PCI-002-2008-OFP/PETROPERU FUNCTIONAL ACTIVITY DISTRIBUTION (AS A PERCENTAGE OF ACTIVITY TOTAL) DESIGNATION (Description)

ACTIVITY TOTAL (Cumulative)

PROJECT TIMING DETAILED ENGINEERINGPROCUREMENTFIELD CONSTRUCTION START-UP SD-1 (Initial Project Management Plan)

250

RC: Within Agreement- specified time period 40 35 20 5 SD-2 (Design Specification Plan)

1200 Prior to 15% completion point of detailed engineering 50 25 20 5 SD-3 (Definitive Plan)1200 Prior to 15% completion point of detailed engineering 50 25 20 5 SD-3FC (Field Construction Plan) 2400 Prior to 30% completion point of detailed engineering 30 25 40 5

PETROPERU S.A.VO TALARA REFINERY MODERNIZATION PROJECT PROJECT INSTRUCTIONS TO FEED-EPC CONTRACTOR IFP SERVICES AND DELIVERABLES - FEED MASTER JOB SPECIFIC PAGE 10 EX PAGE DATE: JULY TIME MANAGEMENT EXHIBIT 2-2 SPECIFICATIONS FOR ACTIVITY LEVELS PROJECT SCHEDULE ACTIVITY TOTAL AND FUNCTIONAL DISTRIBUTION International Bidding Process N° PCI-002-2008-OFP/PETROPERU SD-3MC (Mechanical Completion Plan)

2800

Prior to 85% completion point of detailed engineering and/or approximately 50% completion of field Construction

20 20 53 7 SD-3S (Start-Up Plan)3100 Prior to 75% completion point of detailed engineering 18 18 50 14 NOTES: 1. Refer to Exhibit 2-3 for Project Schedule Activity Specifications. 2. Activity totals exclude restraints between work items. (Restraint totals should half the activity total). 3. Activity totals and functional distribution carry a + 10% range of acceptability.

PAGE 11 OF 12

All SD-1 schedules shall satisfy the following criteria in order to comply with the requirements of Exhibit 2-2, "Specifications for Activity Levels":

1. The activities (and timing thereof) for each major participant of the project shall be identified and the interfaces/dependencies clearly described.

2. With respect to detailed engineering activities, approximately half of these shall highlight the interdisciplinary relationships and interfaces which exist.

3. All activities in both detailed engineering and procurement must comply with the work breakdown structure and the required sequence of field construction and startup.

4. For equipment and material deliveries of a critical or long lead nature, the associated detailed engineering and procurement activities (including execution strategy) shall be clearly defined 5. All critical path sequences and float calculations must be completely identified.

All SD-2, SD-3, SD-3FC, SD-3MC, SD-3S schedules shall satisfy the following criteria in order to comply with requirements of Exhibit 2-2, “Specifications for Activity Levels”:

1. Scope of activity coverage and distribution should be consistent with areas of risk exposure as identified.

2. All activities must possess the characteristics of being finite, definable and measurable (i.e., consistent with the work breakdown structure.) They must be appropriately resourced and leveled.

3. Coverage of critical and sub-critical (three months of critical path) activities shall be at least twice that provided for non-critical activities.

4. Where phased task completions are required, they must be properly identified.

5. The following specific requirements apply:

• Detailed Engineering

- 85% of the activities shall be between 5 and 20 project time units in duration.

- 80% (approximate) of the activities shall be distributed consistent with the breakdown by engineering man-hours by discipline and subdiscipline.

In document FEED (Page 27-37)