The API Monogram Program

1
The APIMonogram Program
2
API Monogram Program
- Beginning

• Established by APIs Board of Directors on
  October 24, 1924
• Originally created to facilitate the availability
  of safe, interchangeable, off-the-shelf equipment
  for use in the petroleum industry

• Identifies companies capable of manufacturing
  petroleum equipment, materials and services in
  accordance with API quality and product standards

3
API Monogram Program
- Beginning
- Scope

• Currently covers over 50 API Exploration
  Production standards
• Designed to address business need of equipment
  interchangeability, reliability and increased
  quality

• As needs have changed, program has changed
• From self-certification to on-site
  verification
• Establishes a warranty between the equipment
  manufacturer, the equipment purchaser and API

4
API Monogram Program
- Beginning
- Scope

• API product standards describe the equipment
  manufacturing requirements
• API Spec Q1 describes the quality system
  requirements

• License Agreement defines the relationship and
  responsibilities between API and the manufacturer
• Oil companies order API-Monogrammed equipment
• Oil companies report product non-conformances to
  API

5
API Monogram Program
- Beginning
- Scope
- Audits

• Quality system is audited
• must meet API Spec Q1
• Manufacturing capability is audited
• must meet API product standards
• License has 3-year term with interim audits
• Initial Audit
• Unscheduled Periodic Audit
• Renewal Audit
• Licensees signify quality and conforming products
  with the API Monogram

6
The Licensing Process
- Beginning
- Scope
- Audits
- Process
Oil Company Purchases API-Monogrammed Equipment
License Issued
7
API Monogram Program
- Beginning
- Scope
- Audits

• Directory of approved companies distributed every
  quarter
• Sent to over 2000 purchasers
• worldwide distribution
• list available on the Web at www.api.org
• Current program has
• 1300 Licensees, 2000 Licenses
• over 60 Countries, with over 65 international

- Process
8
Benefits
- Beginning
- Scope
- Audits

• Helps users readily identify suppliers capable of
  producing API products and committed to quality
• Reduces/eliminates the users on-site supplier
  audit burden
• Provides third-party objective review and
  monitoring system
• International scope allows for broad purchasing
  options

- Process
- Benefits
9
Benefits
- Beginning
- Scope

• Addresses free-rider issue and defrays costs of
  standard development and maintenance
• Increased revenue stream from standard sales
  results in increased research funding
• Petroleum industry-directed and regulated
• Is self-supporting and generates additional
  revenue to reduce API membership dues burden

- Audits
- Process
- Benefits
10
Program Expansion
- Beginning
- Scope
- Audits
- Process

• Working with API Aviation Committee to offer
  licensing for API 1581 - aviation fuel filters
• Plans to include aviation fuel hoses, monitors
  and related products
• Downstream standards licensing demand is building

- Benefits
- Downstream
11
Program Expansion
- Beginning
- Scope

• Over the last 18 months
• 33 requests from 12 different countries for
  downstream licenses
• Demand estimated by local product experts

- Audits
- Process
- Benefits
- Downstream
12
Program Expansion
- Beginning
- Scope
- Audits
- Process

• Proposal Extend licensing to API 610 centrifugal
  pump manufactures
• Action Item Implement pilot program for API 610
  licensing and report on the results next Fall
  Meeting

- Benefits
- Downstream