Veriforce Contractor Meeting

1. Veriforce Contractor Meeting March 18, 2009

2. Introductions Kristin Cothern Data Manager Stephen Covell Drug & Alcohol Debbie Midgley Safety Statistics, ESH, On-line Training Jessica Renard Contractor Liaison Kiley Warford Veriforce Audits Louie Werderich Veriforce President

3. General Issues The Veriforce approach to OQ Sharing qualification data with 3rd Parties Sharing records with other Operators Impact to the client Operator Impact to the “other Operator”

4. Drug & Alcohol

5. Drug & Alcohol Monitoring Overview Submitting information Requirements Recent changes to 49 CFR Part 40 Drug & alcohol field audits

6. Veriforce Drug & Alcohol Operators Cheniere Energy, Inc. Chesapeake Energy Crosstex Energy Services Cypress Pipeline Dominion Energy Transfer Company Enogex Monument Pipeline Northeast Ohio Natural Gas Northern Natural Gas Panhandle Energy PB Energy Storage Services, Inc. SandRidge Energy, Inc. Sempra Pipelines & Storage Smith Production / SOTEX Fuels Spectra Energy TransCanada USA Services Transwestern Pipeline

7. Initial Data Submittal Anti-Drug Plan (compliant with 49 CFR parts 40 and 199) Alcohol Misuse Prevention Plan (compliant with 49 CFR parts 40 and 199) Current Covered Employee List Current Supervisor Training List Contractor Statistical Data Reports (PHMSA)

8. Semi Annual Data Requests Contractor Statistical Data Report (PHMSA) for past 6 months Current Covered Employee List Current Supervisor Training List First half due September 1st Complete year due March 1st

9. Submitting Information Submit to drugalc@veriforce.com Dealing with consortia Updating contact information

10. Requirements Complete statistical data Met random testing percentage Medical Review Officer certified SAMHSA lab certified Anti-Drug Plan approved Alcohol Misuse Plan approved No unresolved audit findings

11. Changes to 49 CFR Part 40 Removal of adulterant cutoff levels Definition changes Ability for MRO to rule out drug use with an invalid specimen when a negative result is required Streamlining of test results

12. Changes to 49 CFR Part 40 Laboratories submit semi-annual statistics to DOT Admission of adulteration or substitution is considered a refusal Direct Observation collections New process for checking for prosthetics Suggested as mandatory for return to duty and follow up tests

13. Drug & Alcohol Field Audits What to Expect Common audit findings Pre-Employment testing Positions subject to testing Communicating the plan Employee Assistance Program Post accident testing

14. Questions?

15. Safety Statistics

16. Safety Statistics Pipeline Operators want to know that their contractors and subcontractors work safely and that they are committed to meeting applicable requirements related to the health and safety of their employees. 

17. Safety Statistics Initially each contractor will submit their statistics for the most recent three (3) calendar years (figured by quarters) then quarterly thereafter. Total Recordable Case Rate and DART Incidence Rate (OSHA 300A form) Number and description of OSHA violations during previous quarter Vehicle Incidents Experience Modification Rate (EMR) - Annually

18. Safety Statistics Pipeline Operators currently mandating safety statistical data: Panhandle Energy Northern Natural Gas SandRidge Energy Transwestern Pipeline Cypress Pipeline Spectra Energy (will discuss them separately) Pipeline Operators that will be requiring safety statistical data in the near future: Petrologistics Dominion East Ohio

19. Safety Statistics Contractors are given access to VeriSource (Veriforce’s database) which enables them to upload statistics directly to Veriforce.  Automatic reminders are sent to contractors when new data is required. All data will be accessible to the contractor and applicable Pipeline Operator(s) through VeriSource.

20. Log in to VeriSource From our homepage (www.veriforce.com) click on LOGIN TO VERISOURCE Fill in your USER NAME and PASSWORD ContAdmin / 12345 Click on SAFETY STATISTICS Then INPUT SAFETY STATISTICS

21. Data Input Injuries and Illnesses Rate (From OSHA 300 form) 2008 4th Quarter 435,999 Hours worked by all employees 0 Total injuries and illnesses 0 Total cases Vehicle Incident Rates 2008 4th quarter 0 vehicle incidents 28,800 miles driven Experience Modification Rates 2008 .80

22. Change Reporting Status Using an Admin Level user login Click on ADMINSTRATIVE Then COMPANY PROFILE Click GENERAL COMPANY INFORMATION edit button

23. VeriSource User Accounts Using an Admin Level user login Click on ADMINSTRATIVE Then MANAGE VERISOURCE USER ACCOUNTS

24. Questions?

25. Spectra Energy Vendor Approval

26. Spectra Energy Vendor Approval Spectra Energy requires all new and existing vendors to submit documentation to Veriforce New Vendors SET submits request to Veriforce Veriforce notifies vendor of requirements via email, phone, or fax Vendor submits data to Veriforce via email Veriforce notifies SET of results

27. Spectra Energy Vendor Approval Spectra Energy requires all new and existing vendors to submit documentation to Veriforce Existing Vendors SET requires vendors to renew every 3 years Veriforce system notifies vendor of renewal requirements Vendor submits data to Veriforce via VeriSource or email Veriforce notifies SET of results

28. Spectra Energy Vendor Approval Spectra Questionnaire requirements: Contact information NAICS and SIC code Type of work States where you provide services OSHA 300 logs Financial documentation (if required)

29. Spectra Energy Vendor Approval Vendors who currently have access to VeriSource can upload information directly to Veriforce.  Vendors without access can submit the form by email to setcontractorapproval@veriforce.com or by fax to 281-404-7161. Automatic reminders are sent to contractors when new data is required.

30. Questions?

31. Training

32. Online Training Training provided by Pipeline Operators: Northern Natural Gas El Paso Corporation Boardwalk Pipeline Partners Avista Spectra Energy SandRidge Cypress Training offered by Veriforce

33. Training Records Management Free service Program able to: Automatically track online training Store company training records Option of having Pipeline Operator view training records Automatic emails sent 60/30/day of training expiration Assign training

34. Questions?

35. Billing

36. Veriforce Semi-Annual Billing

37. Removing Candidates from your Invoice The OQ Administrator can login to VeriSource and remove candidates from the Company list. www.veriforce.com

38. Questions?

39. OQ

40. Operator Qualification

41. Operators Supported by Veriforce Alliance Pipeline Avista Utilities Boardwalk Pipelines CenterPoint Energy Columbia Gas (LDC) Cheniere Energy Inc. Chesapeake Energy City of Lancaster, OH Crosstex Energy Services Cypress Pipeline LLC Dominion (LDC) DCP Midstream Eagle Energy Development Co. El Paso Corporation Energy Maintenance Services Energy Transfer Company Enogex Equitable Resources (LDC) Gila River Power Great Lakes Gas Transmission Iroquois Pipeline Operating Company Kern River Gas Transmission Lion Oil Trading & Transportation Lynx Operating Co. Mardi Gras Pipeline Monument Pipeline NiSource Gas Transmission and Storage Northern Natural Gas ONEOK Partners Panhandle Energy PB Energy Storage Services, Inc. Questar Pipeline Company Sabco Operating Company SandRidge Energy, Inc. Sempra Pipelines & Storage Smith Production/SOTEX Fuels Southern Star Central Gas Pipeline Spectra Energy Tandem Energy Corporation TransCanada’s ANR System TransCanada's GTN, NB, PNGTS, NBPL, and Tuscarora Systems Transwestern Pipeline Company Trans Union Interstate Pipeline Williams Gas Pipeline

42. New Veriforce Operators Avista Utilities CenterPoint Energy Transmission Cheniere Energy, Inc. Cypress Pipeline LLC Lynx Operating Co., Inc.

43. Common Covered Task List (CCTL) Built by Operators and Contractors Operator to Operator portability

44. Common Operators

45. Non-Common Covered Task Operators Several VF Operators utilize their own Covered Task List and evaluation criteria Many El Paso and ANR tasks grant from the Common Covered Task list Matrix in VeriSource CenterPoint Energy Transmission Cheniere Energy, Inc.

46. Portability Operator to Operator (CCT) 30 CCT Operators 3 Non-CCT Operators 4.5 million (90%) of qualifications in place are due to Operator portability Contractor to Contractor 105 portable contractors Portability Form

47. Simulation During Evaluation Simulation must: Include all safety and any other administrative procedures associated with a skill; Reflect the actual work setting sufficiently to reflect work performance; and Require the candidate to do some activity that mimics the actual skill to be measured.

48. Veriforce (Website)

49. www.veriforce.com Clients Resources Evaluator authorization Getting started Logging into VeriSource

50. VeriSource Administrative menu Update profile and contact info Manage user accounts Qualified employees menu By name By Operator Check on Evaluator status Print reports Field Verification Report EN-0431 form ROTS and training guides Operator-specific requirements Download / submit ROE

51. Questions?

52. Audits

53. Two Types of Veriforce Audits: Qualified Individual audits Purpose: Is there any reason to believe he/she should no longer be qualified (i.e. DOT accident/incident)? Evaluator audits Purpose: Did the evaluator follow Veriforce procedures and Operator-specific criteria?

54. Qualified Individual Audits Key information requested in audit: Has the individual performed OQ work? If so, for which Operator(s)? Has the individual been involved in DOT Accident/Incident? Is there any reason to believe the individual should be Disqualified?

55. Qualified Individual Audits How to complete an audit: Review individual’s qualifications listed in the audit notification email Audit Linkhttp://www.veriforce.com/QIAudit/ Non-response to audit = Suspension

56. Reinstatement Policy 1st Offense “Get Out of Jail Free Card” – One time use! Complete audit $25 administration fee 2nd Offense Qualifications are permanently revoked Individual must be re-evaluated

57. Evaluator Audits Reasons for an Evaluator audit: Random For-cause Operator request Types of Evaluator audits: Desktop Field

58. Desktop Audit of Evaluator Phone interview with Qualified Individuals Findings presented to Evaluator for comment If no outstanding potential issues exist, audit closed and final report sent to Evaluator

59. Field Audit of Evaluator Schedule on-site field audit In-person interviews with at least two Qualified Individuals and the Evaluator Preliminary report sent to Evaluator for written comment Final audit report sent to Evaluator and audit closed

60. Evaluator Audits – Possible Outcomes No action required Evaluator authorization revoked ROEs rejected Selected qualifications revoked All qualifications revoked

61. Revoked Evaluator –Reauthorization 1st time – attend instructor-led training and pass written exam (100%) 2nd time – attend instructor-led training and pass written exam (100%) ONLY if majority of Operators agree to reauthorization 3rd time – not an option, permanently revoked

62. 2008 Evaluator Audit Stats

63. Questions?

64. Closing Remarks

65. OQEwww.oqevaluators.com Third-party Evaluators no longer listed on Veriforce website New website devoted to Third-party Evaluators Annual fee of $300 For more information, please email info@oqevaluators.com

66. 1.800.426.1604 24/7 Customer Support