OIL

A Phenomenon Of Tengizchevroil

By Rashid Dyusembaev

Almaty � Atyrau � Tengiz, March 27 (THE GLOBE)

An ideal face? Wishing to have one makes no sense.

In fact, it does not exist.

From Kobo Abe.

TCO's face is not ideal, but for sure a humane one. It means a serious business, one third of Kazakhstan's oil production, care about people, but also challenges

TCO � everything made for the people

"TCO is a Kazakhstan company, a part of this country's economy, so we estimate our accomplishments by the value TCO creates to improve the general economic situation in the country," said Steve McLennan, General Manager, Finance, when interviewed by our correspondent.

TCO is the flagship of Kazakhstan's oil sector. It is the one really successful joint venture project standing out against the background of endless scandals with investment projects. The Karachaganak, CPC and OKIOC projects are yet to start.

TCO produces one third of all crude in Kazakhstan; so, with oil revenues making up 30 percent of the state budget, the company is clearly a core budget source.

Over 1999, TCO contributed to Kazakhstan's state economy $512 million in direct and indirect payments. In 2001, after the CPC pipe has been brought online, its benefits will be further increased.

In the seven years of operations TCO has increased production seven times of the original level, in the meantime, the unit cost has been brought three times lower, making now the average of $2 per barrel. This characteristic puts TCO among the 15 world leaders.

I read through many media reports on TCO activities before actually embarking on a trip to Tengiz in mid-March. It may sound embarrassing, yet the number of critical reports appeared more than the number of complimentary stories. It is obvious that the media tends to go to the extremes when writing about TCO � the picture is always either too good or particularly grim.

I was starting my trip to TCO well charged with negative information, which was a bad sign. In fact, I was anticipating yet another scandal.

What I saw in Tengiz destroyed all the bias pretty soon. Yes, there are problems, but I am sure that TCO is the right business that can serve a model to everybody else.

My first encounter with TCO's people happened right at the airport. The man was going on rotation and, for an obvious reason, I was tempted to ask him about his complaints against TCO. However, I had to drop this tone after I heard the person's comment. "TCO is the best company in Kazakhstan. You must go there by all means. You will see it is great! It really cares about employees, providing absolutely everything".

Later I heard the same things from practically everybody I met in Tengiz. They said, "there is no better place of employment in the entire Kazakhstan."

Tengiz at a glance from inside

The first impression from visiting TCO was that this is one perfectly organized state inside the other bigger one. Having its own territory, its own money � the swipe cards, its own policies. Speaking of policies and order � all is organized to perfection, which strikes you as unnatural. The alarm clock is set at 5 a.m. and at 6 a.m. you are expected at your work place. No place for idle wandering around. The business atmosphere reigns everywhere � no show-off or pretence working, everybody is dedicated to his job. I may say, each employee is radiating self-esteem while doing his job. It is obvious that this attitude of being a proud member of the team is the core source of this perfect order.

Here is a small episode to exemplify the assertion. It was the lunchtime, so I entered the canteen. An occasional observation strikes me: no special catering for the management, the General Director is standing the line together with the rank and file. I had just touched the meal, and then there comes an alarm. I first did not understand what was happening, so continued to work on the food. However, the people abandoned their meals and headed for the exit in a matter-of-fact fashion, no ironic comment, and no giggles. Everybody looked well organized. The employees hurried to the designated master points. It later proved to be a fire drill, yet I have not spotted any laxity, any ignoring attitude, nor any rush around. This really impressed me, and I realized that exactly such well-organized and trained action would for sure save people's lives should a real fire happen. Let me remind you too that the operation at TCO is potentially extremely hazardous. Safety is a number one priority at TCO and the company is committed to maintain the highest standard of safety.

In February the record of 7 million work hours without a lost time injury was reached at TCO. In other words, the operation succeeded in working continuously for 437 days without any work-related incident. A world-class accomplishment. This is the result of a dedicated policy focused on employee's safety, identified through small details here and there. For example, using safety belts is a must unquestionable, same as safety driving ruling out speeding. You can't help respecting the organization for this. Safety is not the only value. TCO is also investing in its people, their training, professional growth, and development of their culture.

The drive for another million

According to one employee, the drive for another million man-hour safety record has become overwhelming at TCO. At first it did not inspire employees so much. Yet, pretty soon the common attitude changed dramatically. A special prize handed to each employee marks every record. "When we were given thermoses for the first record of safety performance some people laughed and some appreciated the idea, but there was no large excitement around the fact. Next time it was a fancy CD player for each employee already accepted as a notable perk. This was the cause of inspiration to many. Nowadays, everybody is striving to achieve another safety record, driven by a strong motivation, reminding his teammate to put on safety glasses or something�" continued the man.

No doubt, it was not the CD-players that provided for achieving world-class safety performance. "We managed to create the attitude and cultivate the culture across the company, where each employee feels his personal responsibility for safety performance," explains Tom Winterton, General Director of Tengizchevroil

"The cutting-edge technologies, the rigorous safety standards and procedures, the dry camp policy and, what we are really proud of, - the extensive Training Program are the key elements of the system." In 2000 only, TCO will invest in those $5.1 million. Training involves both TCO employees and the contractor's workforce.

Working harder to earn a better living

I secretly gloated over an occasional remark by one employee, who said he was concerned about the change of time schedule at the Plant. He was referring to the Management's decision to eliminate one work shift, downsizing to 4 shifts from 5. As I previously mentioned, everybody spoke positive of TCO, creating an impression of a well-orchestrated chorus.

The employee spoke about the problem, which appeared to be in crossfire from both the media and the labor unions some time ago. The change basically impacted the duration of work shifts, extending them from 140 to 170-180 hrs.

"We are having hazardous work conditions here, and they stripped us of those short hours, so I am seriously concerned about my health," said the man.

I approached an attorney of TCO Legal Dept. for a comment. Elena Sutyrina, was eager to help with an explanation. TCO management's decision to change work schedules and conditions of some employees was done in accordance with Prikaz #2, Certification of Company Worksites by Working Conditions, issued by the ROK Minister of Labor and Social Protection on 15 January, 1999. TCO established a Standing Certification Committee staffed with specialists from all lead departments to assess the working conditions at all TCO facilities and consulted in advance with the Ministry of Labor in Atyrau and Astana to ensure the process the Certification Commission was using met the requirements of the Law.

This assessment showed that TCO facilities do not require special benefits for hazardous conditions as defined by previous regulations. For legal and business reasons, TCO management decided to change the work schedule of certain employees to be consistent with the rest of the TCO workforce. However, we did not want to adversely affect these employees' salaries and decided not to change any special allowances the employees had been receiving.

The change in work schedules enabled some plant facilities to now operate with four crews instead of five. This change would have resulted in an employee surplus, but TCO management did not want to terminate the employment of skilled plant workers and decided to continue the employment of all employees affected by the work schedule change.

It so happened that at the same time the Government issued another act annulling the special pensions for working in hazardous environment. This caused a wide spread perception erroneously claiming the company responsible for taking away those pensions. We, however, acted in strict compliance with the Government instructions and left the pensions intact. In fact, we cancelled only the short work hours, leaving the rest of the special allowances intact. As a result, these employees will actually take home more pay each month.

Actually, later other employees approached the management volunteering to transfer to 4 shifts.

Yet, what about employees' health condition?

"Our employees' health and well-being are the top priorities. TCO has a clinic in Tengiz appraised by the Oblast and the RoK public health administration as one of the best in Kazakhstan. All the personnel go through annual physical examination, which is mandatory. Workshops are held on a regular basis for both TCO medical staff and local doctors invited from the Oblast and the village clinics.

We at TCO are applying a very high standard to every operation," said Tom Winterton.