API Sub-Committee 18 TG3 Report

1. API Sub-Committee 18 TG3 Report January 26, 2012 Renaissance Worthington Hotel Fort Worth, Texas Ed Durante, Chairman

2. The First TG3 meeting held November 15 & 16 in Houston Ed Durante (TIEC), Chair Ed Baniak (API) Rick Faircloth (Cameron) James Fraysur (Weatherford), Dwight Karr (Tenaris), Bud Weightman (Consultant), Norm Hein (Norris), Carlo Iasella (USSteel), RaoufNaguib (Woodco), Stacey Hagen (ExxonMobil), Amos Ware (NOV); Celine McCulloch (GE Oil & Gas) TG3 Report to SC18

3. The Second TG3 meeting held January 24,2012 Attending TG Members: Ed Durante (TIEC), Chair Kevin Pennington (Nabors) Robert Koelling (Koelling, Inc) Gary Devlin (Cameron) James Fraysur (Weatherford) DonDufresne (Inserpetrol) Richard Ackerman (Schramm) Norm Hein (Norris) Bud Weightman (Consultant) Renato Zanetti (Tenaris) Carlo Iasella (USSteel) RaoufNaguib (Woodco), William Blue (Baker Hughes) Bart Bartholomew (FMC) TG3 Report to SC18

4. The Second TG3 meeting held January 24,2012 Attending Visitors: Mike Briggs (Cameron) Allen Campbell (Total) Wiliam Blue (Baker Hughes) Mark Espaner (Euraz) Mark Wars (Halliburton) Mike Briggs (Cameron) Robert Perdrick (CRA) Lester Burgess (TSP/US Bolt) Robert Urbanowski (Precision Drilling) API Staff: Katie Burkle Don Whittaker Aaron Duke Tim Gonzales Ed Baniak Marisa McArthur TG3 Report to SC18

5. Categories of Manufacturers under the Monogram Program Product Fabricator - An organization that transforms material into finished product through forming, welding, blending, etc. (Fabricators shall have in-house equipment, and personnel and shall perform the required processes needed to produce the products under the scope of the license) Processor - An organization that changes the chemical/metallurgical/mechanical properties or characteristics of material and/or product through Heat treating, Casting, Forging, etc. (Processors shall have in-house equipment and personnel and shall perform the required processes needed to process products under the scope of the license) Assembler – An organization that assembles components (NOT Re-Assemble) into finished products through welding, bolting, joining, etc. (Assemblers shall have in-house equipment, personnel and shall perform the required processes needed to produce the products under the scope of the license) TG3 Report to SC18

6. Categories of Manufacturers under the Monogram Program Tester – A Third party organization that verifies the capabilities of finished products to meet specified requirements of API Spec 6AV1 and/or 14A. (Testers shall have in-house equipment, personnel and shall perform the required tests needed to certify conformance to the product specification under the scope of the license) Machiner – An organization that changes the physical dimensions of material and/or product through mechanical processing (cutting, grinding, honing, drilling, milling, turning, etc.) (Machiner shall have in-house equipment, personnel and shall perform the machining operations needed to produce the products under the scope of the license) TG3 Report to SC18

7. Categories of Manufacturers under the Monogram Program Spec 6A: Assembled Equipment: Assembler, Machiner Activities In-House: Material Procurement (Yes) Receiving Verification (Yes) Machining (Can be Outsourced) Inspection (Yes) Assembly (Yes) Welding (Can be Outsourced) Testing (Can be Outsourced [Gas/Hydro/NDE]) Marking (Yes) Storage/Preservation (Yes) Component Equipment: Machiner --Revisit TG3 Report to SC18

8. Categories of Manufacturers under the Monogram Program Spec 5CT: Tubular Goods (Pipe mill): Fabricator, Forming Yes Welding Yes Testing (Can be outsourced) Machining/End finishing (Can be outsourced) Inspection (Can be outsourced) Coating (Can be outsourced) Monogram Marking Yes 100% (AMA Allowed) Processing: Processor Heat Treating Yes Testing (Can be outsourced) Machining/End finishing (Can Be outsourced) Inspection (Can be outsourced Coating (Can be outsourced) Monogram Marking Yes 100% TG3 Report to SC18

9. Categories of Manufacturers under the Monogram Program Spec 5CT: Tubular Goods Couplings: Machiner, Threading Yes Monogram Marking Yes   Threads: MachinerThreading Yes Monogram Marking Yes TG3 Report to SC18

10. Categories of Manufacturers under the Monogram Program Spec 4F: Structures: Assembler, Mat’lProcurement – Yes Machining – (assembler may outsource machining) Receiving/ Verification - Yes Assembly – Yes Welding – Yes Testing – Yes Inspection – Yes Marking – Yes TG3 Report to SC18

11. Categories of Manufacturers under the Monogram Program Non-Licensable Activities Distributor– An organization that buys and sells finished products and materials. Designer– An organization that performs engineering design activities. Remanufacturer/Repairer– An organization that repairs and/or remanufactures an existing product through machining, welding, replacement of parts to bring product back to original capability. Plating/Coating Provider– An organization that applies surface finishes through chemical processing or through the application of protective coating. TG3 Report to SC18

12. Options to move forward Self-Disclosure of capabilities 2. Percentage of materials and/or Labor Established Minimum Activities for Licensees 4. A combination of 1, 2, & 3 above TG3 Report to SC18

13. Thank You TG3 Report to SC18