Partnerships in the Oil and Gas Industry - IPIECA

Partnerships in the Oil and Gas Industry

B I O D I V E R S I T Y C A P A C I T Y B U I L D I N G

C L I M A T E C H A N G E C O M M U N I T Y D E V E L O P M E N T

F U E L S A N D T R A N S P O R T A T I O NH E A L T H

H U M A N R I G H T S O I L S P I L L R E S P O N S E

T R A N S P A R E N C Y

Partnerships in the Oil and Gas Industry

International Petroleum Industry Environmental Conservation Association5th Floor, 209–215 Blackfriars Road, London, SE1 8NL, United KingdomTelephone: +44 (0)20 7633 2388 Facsimile: +44 (0)20 7633 2389E-mail: [email protected] Internet: www.ipieca.org

© IPIECA 2006. All rights reserved. No part of this publication may be reproduced, stored in a retrieval

system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or

otherwise, without the prior consent of IPIECA.

The information in the case studies was accurate at the time of printing.

This publication is printed on paper manufactured from fibre obtained from sustainably grown softwood forests and bleached without any damage to the environment.

P a r t n e r s h i p s i n t h e O i l a n d G a s I n d u s t r y • A n I P I E C A p u b l i c a t i o n

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Contents

Introduction 2

IPIECA Foreword 2Chris Morris, IPIECA General Secretary

A global business view 2Guy Sebban, Secretary General, International Chamber of Commerce

A partnership perspective 3Ros Tennyson, Director, Development Partnership Solutions—International Business Leaders Forum

Background and purpose of this publication 4

Sustainable development progress through partnerships 6

Benefits of working in partnership 8

Practical tips for effective partnerships 10

Key to the case studies: 14

Colour-coded matrix listing all 40 case studies by theme and title, and indicatingthe partners, geographical level, location and oil company involvement

The case studies: partnership in practice 16

Forty case studies of partnerships in the oil and gas industry, arranged by the following themes:

• Biodiversity 16

• Capacity building 32

• Climate change 48

• Community development 58

• Fuels and transportation 68

• Health 74

• Human rights 82

• Oil spill response 86

• Transparency 92

A guide to resources 97


Introduction

2

A global business view

Public-private initiatives have emerged as one of the most promising ways for oil and gas companies to develop

and to contribute to the Millennium Development goals, especially when operating in difficult environments in

undeveloped regions. More than 200 partnerships were struck in Johannesburg at the World Summit on

Sustainable Development in 2002, many involving companies from the oil and gas sector. These partnerships

are now bearing their first fruits.

Such initiatives bring a wide assortment of non-governmental and intra-governmental groups around the

same table with local government and energy executives. Business, governments and NGOs must cooperate, as

The past decade or so, particularly since

the World Summit on Sustainable

Development in 2002, has seen the

formation of a number of multi-

stakeholder partnerships to contribute

to sustainable development goals.

In this context, IPIECA decided to

compile a number of case studies to draw out the lessons

learned and explore the benefits and challenges of working in

partnership in the oil and gas industry. The case studies reflect a

growing recognition that oil and gas companies can better

achieve sustainable development goals by working with others.

Companies are indeed collaborating increasingly with a range of

partners including other business entities, government

agencies, non-governmental organizations, community-based

organizations, and academic research institutes.

Forty case studies, consisting of 32 company case studies and

8 industry-wide partnerships, highlight work in the areas of

biodiversity protection, climate change, air quality, oil spill

response, the provision of health care and education, and

community capacity building.

The 40 case studies offer an opportunity for oil and gas

companies to better understand the process of partnering. In

addition, the process of developing and writing the case studies

represented a learning journey for all involved. By working with

IPIECA Foreword

the Partnering Initiative on case study writing guidance, we were

able to ask the right questions to draw out a balanced voice of

the partners as well as tease out the learnings from the

partnering process.

The publication looks at how partnerships have evolved,

what can be learned about a collaborative process and what the

future of working in partnership might look like. Partnership

benefits include: stepping more rationally and safely into the

field of sustainable development; delivering higher quality

project outcomes; promoting the sustainability of projects; and

contributing to the communities within which the oil and gas

companies operate. Moreover, working in partnership is not

always an easy option and, in some cases, will not necessarily be

a unique solution.

A wealth of lessons are to be found throughout the 40 case

studies included in the publication; they comprise a body of

evidence that can usefully be analysed to inform other

collaborative efforts. We hope that all those who are, or are likely

to become, involved in a partnership will find this publication

useful, and we look forward to the oil and gas industry making a

continued contribution to sustainable development.

Chris Morris

IPIECA General Secretary


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NGOs and governments are often the only organizations on the ground in least developed countries which

have credibility and in-depth local understanding. On the other hand, business is often the only source of

technological and managerial know-how, with financial means and access to a supply chain, that crucial

resources communities can now tap to achieve long-term, complex projects. Rebuilding after the 2004 Asian

tsunami is a case in point.

Partnerships offer one of the best ways for oil and gas companies to assure the sort of stable operating

environments necessary for underdeveloped areas to attract further investment and grow the local economy.

But forging a partnership among actors who have diverse interests is a major challenge for the workability

of this arrangement. It will take time and commitment by business, NGOs and governmental organizations to

build trust, essential to any long-term business relationship.

The first few years have shown there is scope to streamline and therefore to speed up the creation of these

arrangements. At the same time, there is also an ongoing need to share best practices, to ensure the ultimate

success and durability of the partnership model.

Guy Sebban

Secretary General, International

Chamber of Commerce

A partnership perspective

For more than 15 years, the Prince of Wales International Business Leaders Forum (IBLF) has been dedicated to

promoting responsible business practice by working together with business to evolve new mechanisms for

systematic business engagement in sustainable development. Increasingly such engagement has been through

the setting up and management of multi-sector partnerships—and some notable successes have been achieved.

It is a new and exciting paradigm, but it is rarely easy for partners to work in new ways with non-traditional

partners. This may be requiring approaches and skills that are well beyond their day-to-day business

relationships. It requires—on all sides—some radical re-thinking, a considerable investment of time, some

changes in behaviour and a willingness to take a level of risk in meeting old challenges in new ways.

The extractive industries have been—and continue to be—leaders in this field. There is only ever one reason

to enter into a cross-sector partnering arrangement: because you (as a sector or an organization) recognize that

you simply cannot achieve your sustainable development goals alone. This is the single driving force behind

successful partnerships and it is this that keeps good partnerships highly focused and highly productive.

However, there are characteristics that seem to underpin all effective cross-sector collaboration: a

commitment to partnering as a mutually beneficial arrangement; increasing openness and transparency in the

day-to-day working relationship; a sense of shared ‘ownership’ and engagement between partners; and a

willingness to build individual and organizational capacity to work across traditional sector boundaries.

We appreciate the way the oil and gas sector has engaged in a wide range of collaborative arrangements

with all sectors and feel confident that (as these case studies demonstrate) there are invaluable lessons not just

for the oil and gas industry but far beyond to other sectors that still lag quite far behind.

Ros Tennyson

Director, Development Partnership Solutions,

International Business Leaders Forum


The United Nations Conference on Environment and

Development, held in Rio in 1992, initiated much

debate on the role of different actors in society. A key

message from this conference was that sustainable

development would only be achieved if all nations and

all sectors of society find effective means of working

together. The IPIECA publication, Technology

Cooperation and Capacity Building: Contribution to

Agenda 21 (produced in association with UNEP in

1994) picked up on this theme, highlighting an

evolution in oil and gas industry cooperation with

stakeholders: from being narrowly focused on

technology cooperation to embracing broader

sustainable development goals.

In 2002, the Johannesburg World Summit for

Sustainable Development (WSSD) recognized that

multi-stakeholder partnerships are essential for

implementing sustainable development goals.

Governments formally ‘endorsed’ the view that

business has a role to play and business agreed that

they were part of the solution. A report on the oil and

gas industry’s contribution to sustainable

development was published in 2002 in the joint

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Background and purpose of this publication

Partnerships in the oil and gas industry—why, where, what and who

The OGP/IPIECA ‘WSSD Report’(published 2002)

The jointUNEP/IPIECApublication TechnologyCooperation andCapacity Building:Contribution toAgenda 21 shows howcooperation withstakeholders hasevolved to embracebroad sustainabledevelopment goals.

The joint OGP/IPIECA publicationThe oil and gas industry fromRio to Johannesburg andbeyond—Contributing tosustainable development (2002)demonstrates how the oil and gasindustry is helping to produce moreaffordable, accessible and cleanerenergy in ways which are responsibleand ethical, and within acceptablelimits of environmental impact.

OGP/IPIECA publication The oil and gas industry from

Rio to Johannesburg and beyond—contributing to

sustainable development (pictured on page 4).

The past decade has seen a step change in the

number of multi-stakeholder partnering initiatives in

the oil and gas industry. This publication consciously

adopts a broad understanding of the concept of multi-

stakeholder partnership to recognize the value that

can be brought by different variations on the

partnering set-up. In this context, the publication

explores partnerships that are variously research,

policy or product driven; that involve different

combinations of NGOs, governments, international

governmental organizations, community groups, and

oil and gas companies; that encompass varying

degrees of contractual obligation; and that span from

2 to 200 participants.

The 40 case studies that make up this publication

have been selected to reflect a diversity of experience

from 19 IPIECA member companies and associations, and

to cover a broad range of sustainability challenges and

themes. The partnerships were selected for their ability to

draw out the lessons that the partners learned through

their collaboration and to identify what key ingredients

may contribute to a partnership’s effectiveness.

Through recording the experiences of the partners,

this publication aims to document the progress that is

being made towards sustainability goals by the oil and

gas industry and its partners, and to explore how

partnering mechanisms have evolved during this

period. It is hoped that, through frank examination of

the partners’ lessons learned, this publication will

serve as a useful learning tool for others embarking on

multi-stakeholder partnerships.


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Case study development process

In order to explore the relationships in oil and gas industry partnerships, IPIECA decided to step away from

traditional approaches to case study collection—where an industry representative writes from his or her

own experience. IPIECA, in association with the Partnering Initiative*, designed a common framework for

writing the case studies and included sample questions to guide the case study writer through semi-

structured interviews with key stakeholders. The guidance encourages the writer to capture information on

the partnering process and to attempt a ‘balanced voice’ between the partners in portraying the partnering

experience. A copy of the guidance document can be found on the IPIECA website: www.ipieca.org.

Administering such a process was a new departure for IPIECA: one which brought its own challenges as

well as rewards. Following an initial review of the case studies, case study authors were encouraged to

reflect more deeply on the partnering process as well as project outcomes. On the whole, where external

consultants were appointed they were less likely to rely on previously recorded information about the

projects and had more time to contact key players and interview them with a neutral agenda.

Developing the case studies following this approach took longer than had first been anticipated but we

believe the extra effort was worthwhile, bringing real insights into the partnering relationship and

achievements. With a little extra support and prompting, the case study authors were able to draw

interesting and varied process lessons from their experiences.

* The Partnering Initiative is a global programme of the Prince of Wales InternationalBusiness Leaders Forum (IBLF) in association with the University of Cambridge Programmefor Industry. It focuses on developing and disseminating cutting-edge knowledge andmethodologies for effective cross-sector partnerships for sustainable development.

The case studies in this publication show

multi-stakeholder partnerships enabling

greater progress towards sustainable

development goals than could be achieved

by any of the partners acting alone.

The eight industry initiatives profiled

within this collection (in summary

opposite) reveal an extensive range of

objectives and achievements: from delivery

on technical targets (lead phase out, flaring

reduction) to innovative research and

development projects (carbon capture

project, ‘Well-to-Wheels’ study) to policy

collaboration (oil spill preparedness,

revenue transparency, human rights,

biodiversity). This impression is reinforced

by the 32 company partnerships included

in this publication (indicated opposite by

the broken lines).

The 40 case studies contained in this

publication are grouped into 9 main

themes and meet a range of challenges

from long-term global issues to an

assortment of more local socio-economic

concerns: healthcare, transport needs,

sustainable jobs and livelihoods, and

community development.


Sustainable development progress through partnerships

6

Fuels and transportation

Biodiversity

Partnership for Clean Fuels and Vehicles (PCFV)

In December 2005, the PCFV celebrated lead phase out in sub-Saharan Africa.This was a goal jointly set in 2001 by the partners(governments, automotive industry and the oil and gas sectors—represented by IPIECA) and jointly achieved through partnership, inrecognition that no one sector could individually bring about cleanerfuels in developing countries. UNEP support was instrumental to thesuccess of this partnership.

The Global Initiative (GI)

Since the launch of thepartnership in Africa in1995, 16 African countrieshave ratified the OPRCconvention.TheIMO/IPIECA GlobalInitiative is an umbrellaprogramme under which thepartners bring togetherrelevant national/regionalactors from both governmentand industry to develop andimplement sustainable oilspill contingency plans andpromote the ratification ofoil spill-related internationalconventions.

The Energy and BiodiversityInitiative (EBI)

The Energy and BiodiversityInitiative has developed a guidancetool for integrating biodiversityconservation into upstream oil and gasdevelopment that is broadly acceptedby industry and the NGOcommunity. Participation by bothNGOs and companies broughtcredibility to the partnership’s outputsin the eyes of both parties.

Oil spill response


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Carbon Capture Project (CCP)

The CCP partnership enables industry experts to work with governmentagencies to develop technologies to reduce costs and improve efficiencies ofCO2 capture, and to demonstrate that storage can be safe and secure.Akey achievement of the partnership has been to integrate stakeholderdialogue into an advanced research and development project, and henceaddress some of the concerns of NGOs and policy makers.

Climate change

Health

Community development

The Voluntary Principles for Security and Human Rights (VPSHR)

The Voluntary Principles for Security and Human Rights partnership has enabledgovernment, industry and NGO partners, sometimes in opposition to one another, toidentify common interests and work together constructively to address security and humanrights concerns at a global level. Levels of trust between the partners have improved over thepast five years and work continues to support companies in implementing the principles.

Human rights

Global Gas FlaringReduction (GGFR)

Since its inception in2002, the GGFRpartnership has developeda global voluntary flaringand venting standard thathas gained broad globalacceptance.Thepartnership, involvinggovernments, oil and gascompanies and ‘neutralbroker’ the World Bank,also assists countries toimplement this and otherglobal programmes at anational level.

The ‘Well-to-Wheels’ study

A key output from the partnership between theEuropean downstream oil industry, the Europeanauto manufacturers and the EC joint research centrewas the ‘Well-to-Wheels’ study.This study has beenused as a basis for discussions and policyrecommendations in many forums.The collaborativeprocess brought increased mutual understanding tothe partners as well as sound facts and figures toinform a debate that had been dominated by‘emotive and ill-founded assertions’.

Transparency

The Extractive IndustriesTransparency Initiative (EITI)

This collaborative effort amongoil and gas companies, NGOsand governments has succeededin bringing wide acceptance thatknowing what governmentsreceive, verified by whatcompanies pay, is a critical firststep towards holding decisionmakers accountable for the use ofthose revenues.The voluntarynature of this initiative has beencritical to its success, as has thebuy-in from resource-richcountries who gain ‘ownership’in this way.

Capacity building


Benefits of working in partnership

The challenges of sustainable development in the oil

and gas sector frequently pivot around competing

interests. The industry is working with other

stakeholder groups at all levels all over the world to

address these challenges. Each partnership is unique,

shaped by the demands of the common task and by

the individual needs of the partners: the forty case

studies brought together in this collection show forty

different circumstances for working in partnership.

That said, looking across the whole set of case studies,

some common benefits and pitfalls of working in

partnership can be identified.

Stepping more safely into the field ofsustainable developmentPartnerships enable oil and gas companies to contribute

to sustainable development initiatives with a reduced

risk of being responsible for deliverables outside their

expertise, while at the same time offering their

competencies to assist partners in project development

and implementation. Partnerships also enable the

sharing of costs, benefits, risks and liabilities of an initiative,

and can provide some legitimacy to oil and gas companies

that step outside their core business operations.

Delivering higher quality project outcomesMulti-stakeholder partnerships can enhance the quality

of development initiatives. Involving a number of

parties—particularly if they come from different sectors

and have not worked together before—can leverage

additional resources, bring new knowledge, and create

a fertile platform for innovation and creativity.

Promoting long-term sustainability ofprojects The overall benefit delivered by partnering initiatives is

also linked to their ‘sustainability’. The case studies

show that when partnering initiatives include local

government (or another actor capable of long-term

commitment) and integrate institutional capacity

building, the long-term sustainability of the

programme is better assured than if the company were

to act alone. In some cases, when the partnering

project objectives align with the government’s national

strategy and when ministry staff are integrated in all

phases of the project, benefits can result for all parties.

Facilitating development and growth ofprojectsThe quality and long-term success of a sustainable

development initiative can also be linked to

‘scalability’. One of the strengths of oil and gas

companies working in partnership with non-

traditional partners is the business know-how of what

it takes to scale up pilot initiatives. Many of the case

studies in this publication indicate that partnerships

can be a vehicle not only for introducing innovation,

but also for taking innovations to scale.

Improving stakeholder engagementPartnerships are essentially about joint action. As such,

they are a special and altogether more influential form

of stakeholder engagement that goes beyond

conventional information disclosure, dialogue, public

consultation programmes and participation in

decision making. The act of negotiating a partnering

agreement, jointly designing and managing an

initiative, and sharing risks, costs and benefits is an

intensive undertaking requiring, even generating, a

close working relationship. And the act of working in

partnership enables companies to demonstrate their

commitment to common goals. Even where ‘project’

outcomes are weak, the level of mutual understanding

built through partnerships can rapidly surpass other

forms of stakeholder engagement.

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Creating open communication channelswith local communities A partnership approach can be very effective when

significant social tensions exist between local

communities and oil companies. Where a company

and an NGO have a long-standing, strategic

partnership, the NGO is able to act as a conduit for the

company in engaging with local communities. These

relationships then act as a form of conflict prevention,

generating open channels of communication, levels of

trust and ‘social capital’ that companies can draw on

when they need to better understand local grievances.

Some of the case studies demonstrate a new

understanding of partnership in which the act of

collaboration can help resolve grievances and

transform adversarial situations.

Contributing to local economicdevelopment of host communities Creating direct local employment or providing

opportunities for domestic enterprises presents a

special challenge for the oil and gas industry because it

is a highly technical industry driven by global sourcing.

This is particularly the case for offshore operations. The

situation is most acute where operations are located in

economically disadvantaged countries or regions that

are characterized by an absence of the right skills, a

weak supplier base and inadequate physical

infrastructure. By engaging with local stakeholders who

may have insights into the local economy, partnerships

offer an important vehicle to address these challenges.

Contributing to wider regional or globalsustainable development effortsSome of the case studies demonstrate how efforts by

single companies to address environmental and social

issues can be transformed through partnerships into

programmes that bring benefits to whole geographic

regions. A collaborative initiative that involves a range

of oil and gas companies, industry bodies for the

sector, environmental regulators, NGOs and

international development agencies can result in a

pan-regional or even global approach to development

issues, something no single company or government

could conceivably achieve alone.

But partnerships are only ‘a good thing’ if they

work, and will only continue to work if they are shown

to deliver benefits. It is important to recognize that

partnerships are not always the right answer and that,

in some cases, there may be a need to focus on

building trust and better stakeholder relations before

moving to partnership activities.

Partnering works because it involves an

appreciation and leveraging of differing but

complementary competencies, but it can take much

longer to deliver outcomes. It is therefore important

for partners to focus on areas either where the desired

outcomes cannot be attained except through

partnership, or where particular benefits will be

derived from the process of partnering.


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Practical tips for effective partnershipsThe case studies in this publication reveal important lessons about current approaches to partnerships in the oil and gas industry.These partnerships have evolved to a stage where they can provide useful road maps for the future: the text below presents anumber of tips intended to assist organizations in effective partnering at different stages of the partnering lifecycle.

Practical tips:

■ Since partnering involves high transaction costs (time, human resources), partners should focus on those activities that can

be accomplished only through partnering, or where the partnering process can deliver particular benefits.

■ Don’t avoid high risk partnerships but be clear about why the risk is worthwhile.

■ The organization that first perceives common possibilities should be prepared to invest more time and resources during

partnership exploration until others see the full value of their involvement.

The actual drivers for entering into multi-stakeholder partnerships are many and varied. Through the case studies,

there are examples of long-term strategic partnerships providing a mechanism for initiating targeted projects, tackling

challenging global issues and responding to situations where relationship building is more important than project outcomes.

The drive to partner is not only one-way. Increasingly as the mutual benefits are more visible and measurable, the NGO

community, academia and other parts of civil society are seeking partnerships with the private sector.

Partnership drivers

Practical tips:

■ Take time to identify the right organizations to work with in terms of skills, profile and organizational role: community

groups and other beneficiaries can help to ensure wider local support; government partners can help to ensure long-term

sustainability; NGOs and IGOs can often offer independent scrutiny of process and research outcomes.

■ Ensure the right individuals are representing the partner organizations within the partnership (i.e. with the appropriate level

of knowledge and authority).

■ Participation from local organizations can be a good way of generating local buy-in and assuring long-term sustainability of

projects.

■ Be realistic about working as an equal partner with government agencies.

■ A systematic selection process can be used and will help clarify what is required from each partner.

There is growing awareness of the need to select partner organizations carefully to access the appropriate array of

resources and competencies needed—and, equally importantly, to identify the appropriate representatives in terms of skills,

status and organizational role from within the organizations. An increasingly competitive environment, when even NGOs

sometimes compete for corporate partners, also suggests the need for a careful partner selection process.

There is increasing recognition that thought should be given to sustaining the partnership activities beyond the life of the

partnership itself. Therefore, it is important to attract certain types of partners—such as government authorities—who will go

on to assume responsibility for sustaining or scaling up project outcomes once the initial resources supporting the partnership

comes to an end.

Partner selection


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Practical tips:

■ Ensure there are some early and concrete ‘win-wins’ for the partners to maintain motivation and momentum within the

partnership.

■ Use of small teams and subgroups working within a bigger partnership can deliver some aspects of a project quickly, maintain

high levels of creativity and build a wider sense of ‘ownership’ of the whole.

■ Continue to build partnering and delivery capacity during the life of the partnership.

■ Agree on external relations positions and strategies that fit for all partners.

■ Provide for regular contact between the partners so that any partnership challenges can be addressed before they cause problems.

■ Prepare for resolving differences—which inevitably arise—by agreeing on appropriate dispute resolution procedures and

grievance mechanisms.

■ Be prepared to renegotiate the terms of partner engagement if required. This possibility needs to be planned for.

At the stage of project implementation it is critical to maintain the partnership to address any flagging momentum.

The case studies uncover a number of approaches being used in the oil and gas sector to ensure all partners retain focus and

commitment throughout the project.

Managing the partnership

Practical tips:

■ Ensure all partners ‘invest’ in the partnership so that equity exists between the partners.

■ At an early stage, provide opportunities for partners to learn about each others’ organizations so that:

a) the partnership benefits from sectoral diversity;

b) the partners are clear about each others’ individual aims in joining the partnership (as well as the common objective); and

c) partnering structures take account of different partners’ needs, in particular the cash flow needs of some smaller organizations.

■ Clearly define the partners’ roles and expected outputs from the start and at all stages of the partnership.

■ Do not underestimate the time it takes to build robust working relationships or rush the transition from partnership

negotiation to joint implementation.

■ A narrow project brief can help partners to focus on areas of overlapping interest rather than on their differences.

■ Third-party facilitation and brokering can be useful in the early stages and also for more complex partnerships. The increase in

initial transaction costs may be offset by time saved later if the partnership starts off on a sound footing.

■ Use of partnership ‘champions’ within and outside the partner organizations can be helpful for promoting the partnership to

other key players and stakeholders.

The first phase of engaging in partnership is often characterized by a high degree of enthusiasm and goodwill. Building on

this initial commitment and creating a strong foundation better equips partnerships to meet challenges at later stages. Equally,

many of the partnerships in this publication functioned well simply by drawing on the relationship management skills of

experienced staff within the partnering organizations.

Partnership building


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Practical tips for effective partnerships(continued)

Practical tips:

■ Agree and articulate a set of performance indicators in the early stages of the relationship.

■ Assess the lessons learned for partner organizations from the partnering process.

Very few of the partnerships in this publication precisely measure their actual impacts. It is, however, in the interest of

all partners to assess the value of their investment in a partnership. The individual outcomes of the partnership (i.e. for each

participating organization) should be assessed as well as the common project outcomes. This is likely to reveal a number of

unexpected, as well as expected, benefits for each partner.

Evaluating the success of the partnership

Practical tips:

■ Collaborative projects have room for both a contractual and a partnership approach; organizations may have to make a

considerable cultural shift to move from a ‘contract’ approach to a ‘partnering’ approach.

■ Contracting out certain aspects of the delivery of programmes can be an effective and efficient way of working, but attention

should be paid to balancing which aspects are contractually based and which come under the partnership relationship.

■ Partnerships are likely to involve memorandums of understanding (MOUs), agreed project plans and other forms of written

agreements. These should be distinguished from specific aspects of work that a partner delivers under contract.

■ Partnerships need clear accountability mechanisms:

a) between the partners for the partnership as a whole; and

b) for the delivery of specific pieces of work.

■ Keep paperwork simple, understandable and as flexible as possible.

Contracts and agreements play an important role in almost all the partnerships profiled in this collection: a spectrum

emerges ranging from partnerships that contain only minimal contractual elements to those that are mostly contract-based.

This may be a particular characteristic of partnerships in the oil and gas industry, stemming from the complex drivers

underpinning the partnerships, and from the involvement of multiple stakeholders.

It is necessary to distinguish between partnering agreements and contracts: a partnering agreement signals a voluntary

collaboration and describes shared risks and implementation on terms that are jointly decided and renegotiable. In contrast, a

contract is legally binding and focuses on transferring risk to the implementing party. Terms are often decided by the party

contracting out. The trend in the industry appears to be that, even where the partnership contains contractual elements, more

of a partnering approach is used in its development by consulting and pre-agreeing the content of the contract.

Agreements and contracts


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Practical tips:

■ Pay care and attention to the exit aspects of a partnership—equally when key individuals or organizations are departing

during the life of a partnership or when the partnership itself is being terminated.

■ At the end of a partnership (or when an individual or organization leaves the partnership), ensure shared credit and joint

ownership, and celebrate achievements and outputs.

■ Jointly prepare your ‘messages’ to explain or contextualize the moving-on strategy with a focus on outcomes rather than on

the end of the partnership.

Many of the partnerships described in this publication were launched without a clear understanding of how the

experiment would end; a plan for ‘closure’ or ‘exit’ is rarely built from the beginning. The need to move on is often only

addressed (and then rather poorly) at a late stage or when an exit is imminent. Furthermore, departure or moving on is often

interpreted as failure. In reality, however, a partner (whether an individual or an organization) leaving or a partnership being

disbanded—specifically where a task has been completed—can be a significant indicator of success. And even when it is not,

an exit can itself be a trigger for an interesting entry or an opening up to a range of new possibilities.

Exit strategies and moving on

Expertise from The Partnering Initiative assisted greatly in drawing together the hints and tips contained in this section.


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Key to the case studies

Theme:

■ Biodiversity ■ Community development ■ Human rights

■ Capacity building ■ Fuels and transportation ■ Oil spill response

■ Climate change ■ Health ■ Transparency

Key wordsThe case studies

The AgriBioDiversity Project in Italy environmental management systems; integrated planning

The Save The Tiger Fund endangered species protection; project funding mechanism

Developing a Biodiversity Action Plan in Peru pipelines; sustainable resource use; educational and social development; EBI

The Energy and Biodiversity Initiative integrated planning; guidance products; informal network post-partnership

Environmental Preservation in the Arabian Gulf marine ecosystems; scientific research

Monitoring and assessment of biodiversity in Gabon environmentally protected areas; in-country capacity building

The Port-Cros National Marine Park, France sustainable management and tourism; stakeholder engagement

Marine Biodiversity and Coastal Livelihoods Project in Indonesia sustainable livelihoods; education and outreach; marine protected areas

Expanding a water pipeline network in Egypt infrastructure; community economic development; skills transfer

Building NGO capacity for pipeline monitoring in Azerbaijan international monitoring and audit practices; transparency; good governance

Sustainable development in the Gulf of Paria, Venezuela biodiversity; community development; health; oil spill response and planning

The Emergency Medicine Development Initiative in Azerbaijan pipeline construction; emergency medicine; training

The Ormen Lange Slide Risk Project gas field development; geological risk; R&D; external verification

Oil Industry Workforce Development in Yemen development of local workforce; training; stakeholder engagement

Sustainable harvesting of biodiversity resources in South Africa sustainable resource use; sustainable livelihoods; partnership KPIs

The development of a strategic relationship institutionalization of NGO consultative partnership

The Carbon Mitigation Initiative technical research programme; carbon mitigation; CO2 capture and storage

The Global Climate and Energy Project greenhouse gas emissions; energy technology; research capacity building

The CO2 Capture Project risk-based evaluation tool; R&D; intellectual property management

The Global Gas Flaring Reduction Partnership gas flaring and venting reduction; voluntary industry standard

The Partnership for Fuels and Vehicles Research air quality; research and technology development; EU policy support

The Oro Community Development Trust in coastal Nigeria NGO intermediary; participatory model; capacity building; transferable model

Vocational training and sustainable livelihoods for women in Pakistan participatory model; women’s empowerment; vocational training

The Bhit Rural Support Project in Pakistan income generation; capacity building; health; education; water resources

An education and rural development programme in Patagonia community economic development; education

Rural electrification in Morocco rural electrification; transferable model

Florida’s first hydrogen energy station demonstration project; transportation; hydrogen technology; energy efficiency

Strengthening the hydrocarbon road transport sector in Madagascar transport safety standards; economic development; training; global compact

The Partnership for Clean Fuels and Vehicles air quality; vehicle emission controls; gasoline and fuel quality; UN umbrella

The Alliance Program’s Safe Tank Alliance safe work practices; cooperative regulatory environment; education; outreach

The prevention of mother-to-child transmission of HIV/AIDS maternal and child health; community education; capacity building

The use of insecticide-treated bednets in malaria prevention community health; education and outreach; product distribution

The Bioko Island Malaria Control Project community health; capacity building; sustainability assurance

The Voluntary Principles on Security and Human Rights voluntary guidelines; risk assessment; in-country working groups

Human rights training of Sharia judges in Nigeria human rights; legal training

Action on oil spills: the IMO/IPIECA Global Initiative contingency planning; regional cooperation; international conventions

Oil spill response exercise in Martinique international exercise; global initiative; awareness raising and capacity building

The National Oil Spill Control and Contingency Plan in Malaysia oil spill training and exercises; national planning and international cooperation

The Extractive Industries Transparency Initiative revenue management; reporting and validation; voluntary initiative

Revenue Transparency in Azerbaijan revenue management and transparency; consensus decision making; EITI

Biod

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15

Partners:

GOV = government O&G = multiple oil and gas COM = community groups

IGO = intergovernmental organizations B&I = business and industry

NGO = non-governmental organizations RI = research institution

Partners Level The companies Page no.Location

NGO • O&G • RI national Europe Eni 16

NGO international Russia ExxonMobil 18

GOV • NGO • COM national South America Hunt Oil 20

NGO • O&G global global Industry 22

GOV • RI regional Arabian Gulf Saudi Aramco 24

RI local Africa Shell 26

GOV • NGO • RI • COM local Europe Total 28

NGO local/provincial Southern Asia Chevron 30

GOV • O&G • B&I • COM local Africa BG 32

O&G • NGO national Caspian BP 34

GOV • IGO • NGO • RI • COM local/national/international South America ConocoPhillips 36

GOV • NGO • B&I local Caspian Hess 38

GOV • RI regional Europe Hydro 40

GOV • RI national Middle East Nexen 42

NGO • B&I regional Africa Shell 44

NGO local/provincial global Shell 46

B&I • RI global global BP 48

B&I • RI global global ExxonMobil 50

GOV • IGO • O&G • RI global global Industry 52

GOV • O&G global global Industry 54

IGO • O&G • B&I regional Europe Industry/CONCAWE 56

NGO • O&G • COM local Africa Nexen 58

GOV • NGO local/provincial Southern Asia BHP Billiton 60

GOV • NGO • O&G local Southern Asia Eni 62

NGO local/provincial South America Repsol YPF 64

GOV • NGO • B&I national Africa Total 66

GOV • B&I national USA Chevron 68

GOV • IGO • B&I • RI global/national Africa Total 70

GOV • IGO • NGO • O&G • B&I global Africa Industry/IPIECA 72

GOV • NGO • O&G national USA API 74

GOV • NGO • RI national Africa Eni 76

GOV • NGO regional Africa ExxonMobil 78

GOV • NGO • O&G • RI local Africa Marathon 80

NGO • COM global global Industry 82

NGO national Africa Statoil 84

IGO • O&G global global IPIECA members 86

GOV • IGO • O&G regional Caribbean Clean Caribbean 89

GOV • O&G regional Southern Asia Petronas 90

GOV • NGO • O&G global global Industry 92

GOV • O&G global/national Caspian BP 94


16

The AgriBioDiversity Project in Italy

Eni E&P Division and Shell Italia E&P established a working

group that, in 2003, launched the AgriBioDiversity project, a multi-

partner collaboration for biodiversity monitoring in the ecologically

sensitive area of Val d’Agri, southern Italy.

Background

Biodiversity monitoring facilitates evaluation of the

status of ecosystems and the impact of human activities

upon them. The oil and gas industry recognizes the

importance of biodiversity conservation and is fully

aware of potential impacts at all stages of E&P projects.

In this respect, focusing on biodiversity and developing

best practices to manage and reduce the impacts—and

the associated reputational risks—of development

projects have become key issues for the industry.

Val d’Agri is a biodiversity-rich and ecologically

sensitive area in southern Italy. Part of the area is a

national park containing some EU sites of Community

Importance and of protected flora and fauna.

As the operator of the Val d’Agri concessions, and in

collaboration with its partner Shell Italia E&P, Eni E&P

invited a number of organizations with complementary

skills and roles to take part in a multidisciplinary

working group to explore biodiversity issues in the

area. In 2003, the working group set up the

AgriBioDiversity project to address the biodiversity

issues that it had identified.

The AgriBioDiversity Project

The AgriBioDiversity project has two main objectives:

1. To develop a biodiversity monitoring programme

as a tool to assess and reduce or mitigate the

impacts of E&P activities.

2. To define best practices for integrating biodiversity

conservation into environmental management

systems and operations.

The approach and process for developing the

monitoring programme draw on the Energy and

Biodiversity Initiative (EBI) guidelines (see the EBI case

study on page 22) and include both site visits, to

conduct ecological baseline assessments, and

consultations with representative stakeholders, to

identify issues of significance to the local community.

The monitoring is carried out at both landscape

and site-specific levels to better understand the

environmental and socio-economic changes in the

area, identify their drivers and evaluate the potential

impacts of oil operations that need to be addressed,

mitigated and avoided in the future. One report has so

far been produced describing the results of the

monitoring programme, the site visits and the

stakeholder consultations.

The outcomes of the AgriBioDiversity project are to

be incorporated into operating best practices in the

Val d’Agri concessions, as well as into the wider Eni

and Shell organizations, and will also contribute to the

EBI trials.

The partners’ contributions

The partners brought a range of skills and experience

to the project:

■ EniTecnologie—technical background and in-

house expertise;

■ Shell Italia—know-how on biodiversity, in

compliance with the EBI;

■ Fauna and Flora International (FFI), an international

NGO also involved in the EBI—an independent and

science-based approach to biodiversity;

■ The World Conservation Union (IUCN), a global

conservation network—expertise in conservation,

biodiversity monitoring and sustainability;

■ The University of Basilicata—consolidated and

internationally acknowledged scientific expertise,

fieldwork, and knowledge of the territory and the

stakeholders.

Particular responsibilities in the project work are as

follows:

■ Together with Eni’s Technology Development and

Technology Transfer divisions, EniTecnologie

manages and supervises the project, provides

logistical support in the field and promotes the

integration of project partners.

■ Shell helps integrate the outcomes of the

monitoring programme into operations.

■ FFI acts as a strategic advisor, particularly in the

stakeholder engagement process, and as a partner

Key partners

• Eni Exploration &Production Division

• EniTecnologie

• Fauna & FloraInternational (FFI)

• Laboratorio GruppiSanguigni

• Shell Italia Exploration& Production

• University of Basilicata

• The WorldConservation Union(IUCN)

KEYWORDS: environmental management systems; integrated planning

17

in the local scientific community. FFI’s involvement

has provided an independent ‘verification and

certification’ of:

i) the approach and methodology adopted;

ii) the quality of the protocols developed; and

iii) the experimental data collected.

■ Supported by the Laboratorio Gruppi Sanguigni, a

stockbreeders’ cooperative, the University of

Basilicata is responsible for the fieldwork activities

and participates with a team of 15 people. The

university’s team has also been crucial in

understanding and analysing the social context of

the Basilicata region, and in optimizing the process

of stakeholder engagement.

Lessons learned

In setting up the project, the partnership faced the

following issues:

■ The need to engage with biodiversity both

strategically and operationally.

■ The project’s high national and international

visibility.

■ The attention of national NGOs that recognize the

ecological significance of Val d’Agri.

■ The region’s complex socio-economic context.

■ The reputational risk in the event of failure.

The partnership work sought to address the above

issues, and in the process the following key lessons

resulted:

1. Knowledge of biodiversity is a tool for evaluating

how an oil company performs and how to minimize

the impacts of E&P activities. This knowledge

emerged from the integrated vision of the various

perspectives (business, ecological and social) of the

partners in addressing biodiversity.

2. A long-lasting and effective partnership between

organizations with different backgrounds requires

clearly defined roles and tasks from the start, as

well as ongoing monitoring of progress through

meetings and corporate reviews.

3. Regular meetings of the project team give each

member the opportunity to address the

partnership challenges as they arise.

4. Holding local stakeholder consultations at regular

intervals throughout the project enables useful

suggestions from the stakeholders to be

incorporated, as appropriate, into the design of the

monitoring protocols.

5. Local stakeholder engagement demonstrates

respect for the local community’s views and

resulted in greater inclusion of the local community

in the AgriBioDiversity project, and increased

community ownership of the project and its

outcomes.


THEME: Biodiversity

PARTNERS: NGO • O&G • RI

LEVEL: national

LOCATION: Europe

Conclusions

Building and carrying out a multi-partner project has

not been and is still not an easy task. It is a learning

process towards how best to integrate differing

expertise, cultures and value systems.

Having a common goal to address biodiversity

helped to guide the process and integrate all the

partners’ contributions. A fundamental step was the

understanding that the fieldwork activities needed to

be designed so that the resulting information would

improve company practices and biodiversity

protection, help with risk management and lead to

other opportunities for the partners to work together.

This successful experience suggests a working

format for partnership that can be applied in other

operational contexts worldwide to address

biodiversity issues.

Val d’Agri is abiodiversity-rich andecologically sensitivearea in Southern Italy.


18

The Save The Tiger Fund

In 1995, partners ExxonMobil Foundation and the National Fish and

Wildlife Foundation established the Save The Tiger Fund dedicated to

supporting the conservation of the world’s remaining wild tigers.

Background

At the beginning of the 20th century, an estimated

100,000 wild tigers were living in Asia, from Siberia in

the north, to Sumatra and Bali at the southernmost

reach of their known range. A century later, fewer than

5,000 of the big cats remain in the wild.

In 1987, trafficking of all tiger species was banned

by the Convention on International Trade in Endangered

Species of Wild Fauna and Flora. Despite the treaty,

however, many dangers still threaten the world’s tigers.

Loss of habitat, poaching and illegal trade in tiger skins

and parts for use in clothing, folk medicine and other

purposes pose the most significant threats to the

animal’s survival.

ExxonMobil has been associated with the tiger since

the early 1900s, when the cat’s image first symbolized the

oil company’s (then Exxon’s) products. In 1992, the

company began supporting efforts aimed at ensuring the

wild tiger’s continued existence. Around this time, the

company began looking for a partner with a history of

collaborating effectively with the private sector and

investing strategically in conservation. In response to this

objective, Exxon approached the National Fish and

Wildlife Foundation (NFWF), a private non-profit

organization established by the US Congress in 1984.

Thus began the partnership between the NFWF and

ExxonMobil Foundation.

The Save The Tiger Fund

In 1995, the partnership set up the Save The Tiger Fund

(STF). Under the direction of the Save The Tiger Fund

Council, which includes international conservation

experts, STF resources are allocated twice each year to

projects in such areas as field study and management;

conservation education and advocacy; anti-poaching

programmes; habitat restoration and protection; and

human-wildlife conflict resolution.

The STF works with international organizations such

as the World Wildlife Fund, Wildlife Conservation

Society, Conservation International, WildAid, Fauna and

Flora International, and local organizations in tiger-

range countries.

ExxonMobil Foundation brought significant

financial support, management expertise and a long-

term commitment to the partnership to address the

problems facing wild tigers. The ExxonMobil

Foundation counsels the STF on operational, strategic

and organizational matters, and company

representatives participate in STF events worldwide.

The company provides more than US$1 million

annually to support the STF, with grants totalling more

than $11 million by the end of 2005. The STF has also

received nearly $2 million in donations from the public

over the past decade. In 2004 and 2005, the Critical

Ecosystem Partnership Fund was also a major

supporter of STF.

The Campaign Against Tiger Trafficking

Recognizing the increase in the illegal tiger trade, in

September 2005 the STF established a three-year

initiative known as the Campaign Against Tiger

Trafficking (CATT). CATT galvanizes support, leadership

and cooperation among various parties—governments,

conservation organizations, traditional Chinese medicine

practitioners, businesses and communities—to stop the

poaching, smuggling, trade and use of tiger parts. CATT

has already become a respected clearinghouse for news

and information on tiger trafficking, and the campaign

regularly issues updates on the illegal trade.

‘CATT is organizing a global response to what is now

the number one threat to tigers in the wild,’ CATT

director Judy Mills says. ‘Habitat destruction is still a

problem, but if we can’t stop the trade, we may end up

with habitat but no tigers.’

Key partners

• ExxonMobilFoundation

• National Fish andWildlife Foundation

KEYWORDS: endangered species protection; project funding mechanism

19

Mills, a veteran environmentalist, credits

ExxonMobil for its commitment to saving tigers. ‘The

company’s been willing to support the Save The Tiger

Fund and go in this new critical direction through CATT,’

Mills says. ‘I believe it’s especially commendable in the

corporate world.’

Progress

Since its inception, the STF has awarded 284 grants

totalling more than $14 million to support tiger-focused

projects in 13 of the 14 countries where wild tigers are

known to exist. Worldwide, STF grants represent nearly

one-third of all funds invested in tiger conservation

efforts by NGOs.

According to Dr Mahendra Shrestha, the STF

director, ‘to save tigers in the wild, we have to work with

people who live with the tiger. In our recent field visits in

Nepal,’ Dr Shrestha adds, ‘we heard from men and women

who expressed great appreciation for the programmes

that have developed as a result of STF’s community

support efforts, such as savings and credit operations,

milk producers’ cooperatives and eco-tourism businesses.’

These projects demonstrate the added benefits that

can accompany habitat restoration in cooperation with

local communities.

The STF’s strategy of encouraging cooperation and

communication among diverse groups, seeking advice

from experts, promoting partnerships, delivering

effective conservation strategies, building local

conservation expertise and linking community benefits

with conservation has been vital to its success.

Because of the efforts of the STF and its partners,

organizations are working together to stabilize the

relationship between people and wildlife. Tiger habitats

are being protected and rebuilt. Poachers are being

persuaded to become tiger guards. Additional

legislation has been passed to reduce the international

trade in tiger parts, and other actions are strengthening

law enforcement. Awareness campaigns are also being

launched to gain public support.

Challenges

Allocating available funds to ensure maximum benefit

is one of the challenges of operating within the STF

partnership, particularly in light of the difficult nature

of tiger conservation. Unfortunately, as with many

efforts of this type, the development of a good

investment evaluation process is still evolving.

Therefore, STF continues to make investments

specifically designed to improve both the data used for

decision making—such as updates on tiger habitat

assessments and enhanced tiger census information—

and the evaluation methodology. It is also nearing the

completion of a rigorous review of all of its project

investments, which will provide STF with invaluable

learnings for future investment decision making. These

factors, along with the wisdom and expertise that the

Council brings, are resulting in constant improvements

in meeting this challenge.

Perhaps the greatest challenge is attracting

additional funding partners. Sustained funding is

essential given the long-term, multilateral and complex

nature of tiger conservation. Creating both a stable and

an expanding funding base with partners that reflect a

broad donor community with sufficiently similar

priorities and practices is an ongoing challenge.

Conclusions

Despite the ongoing challenges, hopeful signs point to

better prospects for wild tigers. They are being brought

back from the edge of extinction, and nearby

communities are increasingly reaping the benefits that

come from protecting the tigers and their habitat.

While working to protect tigers in the wild remains

the most important aspect of the NFWF–ExxonMobil

Foundation partnership, the partnership has also led to

improved communications with like-minded

environmental groups.


THEME: Biodiversity

PARTNERS: NGO

LEVEL: international

LOCATION: Russia

Sumatran Tigers—mother and her cub


20

Developing a BiodiversityAction Plan in Peru

Hunt Oil, the operating partner for Peru LNG, is working with local

communities, the Peruvian government, NGOs and biodiversity

consultants to promote sustainable resource use and conservation along

the route of a proposed natural gas pipeline through the Andes.

Background

Peru LNG is proposing a natural gas liquefaction

project, which includes the construction of a 400-km

pipeline to carry natural gas across the Andes, from the

Camisea fields in the rainforest, to the proposed

terminal site on the Pacific coast near Cañete. The

pipeline project will transect four ecological regions

and several political regions. Approximately half of the

identified area of influence has primarily indigenous

populations comprising around 68,000 inhabitants.

The United Nations Environment Programme

(UNEP) has designated Peru as a ‘megadiverse’ country.

Most of its natural resources are located in rural areas,

and communities rely heavily on them for their

livelihood—a dependency that often leads to pressures

on biodiversity conservation.

Unsound agricultural and grazing development,

heavy poaching of vulnerable species and threats to

the conservation of valuable resources, such as

medicinal plant species, and to traditional knowledge

are increasing problems. Locals are seeking the

assistance and expertise of government and other

organizations in addressing these issues.

Hunt Oil (Peru LNG’s operating partner) formed a

partnership with Peru’s National Council for the

Environment (CONAM) to pursue the common goal of

sustainable development by funding projects in line

with Peru’s national biodiversity strategy and other

conservation programmes.

The Biodiversity Action Plan

The partners identified that a Biodiversity Action Plan

(BAP) for the pipeline construction and operation

project would promote sustainable use of natural

resources and open a dialogue between the company

and local stakeholders. The BAP would help highlight

investment opportunities, increase local capacity to

conserve biodiversity and address local people’s basic

needs through education and social programmes. To

gain community acceptance and participation, the

programmes would need to be tailored to the needs of

more than 70 communities or districts along the

pipeline right of way.

The partners realized early on that a multi-

stakeholder consultation process was needed to obtain

meaningful and accurate information. Participatory

Rural Appraisal workshops, focus groups and

one-on-one interviews were conducted with

communities and NGOs. In these meetings, participants

identified existing community resources, priority

species to conserve and other organizations already

doing effective conservation work in their

communities. Around 4,500 local people participated in

the meetings.

Coordinating the consultation effort with the local

stakeholders was not an easy task, however. First, the

distance and remoteness of some of the communities

made it extremely difficult to access the people.

Second, the consultation meetings required fluency in

the traditional tongue of Quechua, spoken almost

exclusively in the most remote and typically most

ecologically significant areas of the Andes. Third, an

understanding of the traditions and cultural nuances

was essential to ensure that the locals felt comfortable,

and to encourage them to contribute at the meetings.

The NGOs and local organizations that participated

in the process understood the cultural and social

conditions of each community and were sensitive to

their real needs and expectations. For example,

traditional meals were served prior to, or during, the

meetings, and participants were often seated on the

ground, not at tables and chairs. In addition, the

Key partners

• Hunt Oil Company

• National Council forthe Environment, Peru(CONAM)

• Walsh Peru

• 35 community-basedorganizations

• Panel of local, nationaland internationalspecial interest groups,provincial governmentrepresentatives andlocal universities

KEYWORDS: pipelines; sustainable resource use; educational and social development; EBI

Communicating withcommunity leader fromthe Ayachucho region ofPeruvian Andes

21

organizations themselves made decisions by consensus

in communal sessions in the traditional Incan way and

used this form in the meetings.

In spring 2005, Peru LNG initiated an Environmental

and Social Impact Assessment for the pipeline project.

Additional specific biological and social data were

collected along the length of the pipeline.

Lessons learned

■ The partners need to understand the positions and

viewpoints of the various stakeholders. When

identifying key species requiring conservation,

international NGOs tend to focus on high-profile or

flagship species, such as the Andean condor, while

locals might select species with spiritual, economic

or medicinal value. Even among the NGOs,

priorities vary widely depending on the

geographical area. The different opinions indicate

that coordination of conservation goals may not

always be possible.

■ To maximize resources, Peru LNG and CONAM have

sought to build partnerships with NGOs or other

organizations that have objectives and perhaps

ongoing initiatives that align with the partnership

goals for biodiversity conservation. They have also

looked for organizations that have established

relationships with the communities and that the

local people trust. CONAM and the community-

based organizations have been helpful in identifying

past partnerships that could be built on—or,

conversely, avoided if they had a poor track record

with the community or had mismanaged funds.

■ Managing the expectations of the various

stakeholders is an ongoing challenge. Educating

local community members and working with them

to establish mutually agreeable and realistic targets

are important first steps to correcting any

misperceptions of the capacity of a Biodiversity

Action Plan.

■ Developing an early partnership with government,

NGOs and local stakeholders allows multiple views

to shape the BAP, improving interaction

throughout the process and allowing effective

working relationships to be built on trust. Priorities

and targets were agreed early on, allowing for

greater focus and coordination among all parties.

■ The most successful projects are conducted

through partnerships that directly involve the

community, enhance cultural traditions and

provide some type of a benefit to the local

stakeholders. Ensuring buy-in from the

communities and their active participation in a

project right from the start increases the likelihood

of the project becoming self-sustaining, leading up

to the time when the sponsor exits the programme.

Conclusions

Partnerships are a useful means to maximize available

resources, and they permit greater outreach and

improve the exchange of information with local

communities, local organizations and NGOs. Such

partnerships are likely to be most effective when oil

companies work with experts and organizations that

understand the cultural and social differences of each

community, and that have established working

relationships based on trust and goodwill.

Coordinating programmes through multi-partner

initiatives requires the partners to work outside their

comfort zone through consensus building to draw in

other perspectives and consider a range of cultural

viewpoints. A consensus approach will broaden the oil

company’s objectives and perspective.

Although this collaborative partnership required a

great deal of effort in the early stages of BAP

development, the model works, and Peru LNG and

Hunt Oil are likely to replicate it in similar initiatives in

South America and beyond.


THEME: Biodiversity

PARTNERS: GOV • NGO • COM

LEVEL: national

LOCATION: South America

Children at acommunity workshopin the area near theproposed pipeline right of way in thePeruvian Andes


22

The Energy and Biodiversity Initiative

The Energy and Biodiversity Initiative is a partnership of four energy

companies and five conservation organizations created to develop and

promote practices for integrating biodiversity conservation into

upstream oil and gas development.After four years the formal

partnership came to a close, but partners continue more informally to

explore opportunities to be a positive force for biodiversity conservation

within the oil and gas industry.

Background

Oil and gas exploration, production and transmission

are increasing in sensitive ecosystems of concern to

conservation organizations. The Center for

Environmental Leadership in Business (CELB) at

Conservation International (CI) initiated a collaborative

effort among multiple energy companies and

conservation organizations to improve biodiversity

conservation in oil and gas operations. CELB approached

two distinct communities: energy companies committed

to improving their biodiversity conservation performance

and conservation organizations with field experience

working with the energy industry. After two years of

discussions, the Energy and Biodiversity Initiative (EBI)

was formally created in 2001 as a partnership.

Development of the Energy andBiodiversity Initiative

EBI’s goal was to develop practical guidelines, tools and

recommendations to promote integration of

biodiversity conservation into oil and gas operations

throughout the industry. The member companies and

CI provided financial support; each partner also made a

major commitment of senior staff involvement. All

participants equally shaped and developed EBI’s

objectives, structure and outputs through a dynamic

and inclusive dialogue. Agreeing on objectives was a

lengthy process, in part because only a general mission

statement was defined at the outset.

The EBI evolved over four years. Phase 1 focused on

developing recommendations, tools and guidance on

key topics. Phase 2 piloted, disseminated and

promoted industry application of the EBI products. At

the end of Phase 2, the group concluded that the

principal purpose of the partnership—development

and launching of the guidance—had been achieved.

Rather than continuing EBI as a formal entity, partners

agreed to maintain an informal network to continue

contributing to dissemination and use of the products.

Progress and lessons learned

The EBI offers valuable lessons for prospective

multilateral corporate-NGO partnerships:

■ Setting realistic estimates of schedules and

resource requirements is not always easy. The

amount of work involved in managing a multi-

partner initiative, building trust and synthesizing

large amounts of information into usable outputs

was difficult to predict accurately.

■ Building trust and understanding takes time. Trust

underpinned the ability to talk openly and frankly

about issues. It depended on partners coming to

know and understand each other. The process was

strengthened by meetings in locations outside the

reach of e-mail and telephones; however, the

meetings were difficult to schedule and created a

long project lead time. Using a facilitator in the

early stages helped build trust and understanding

among the partners. However, the partners decided

that long-term reliance on a facilitator would reduce

their sense of ownership of the project and did not

use one after the first few meetings.

■ Having the right organizations and people around

the table is critical. The initial choice of partners was

a pragmatic one, targetting committed companies

and conservation organizations that could work

together. Restricting participation facilitated

decision making and production of outputs in a

reasonable time frame with the available resources.

Key partners

• BP

• Chevron

• ConservationInternational

• Fauna & FloraInternational

• The NatureConservancy

• Shell

• SmithsonianInstitution

• Statoil

• World ConservationUnion

KEYWORDS: integrated planning; guidance products; informal network post-partnership

23

However, this approach left EBI open to accusations

of elitism, plus some members think that the lack of

diversity may have made ‘selling’ the EBI products1

to some potential users more difficult.

■ Developing outputs ‘by committee’ brings both

benefits and challenges. Joint writing of the EBI

products by the partners led to a strong sense of

ownership. However, finding adequate time to plan

and produce the products was a significant

challenge for all involved. Furthermore, the need to

bring in consultants to help finalize the EBI

products maintained the project schedule, but also

introduced significant unforeseen costs that had

not been built into the budget.

■ Outreach and dissemination plans should be

defined as early as possible. Although the

participants developed engagement and

communication plans to disseminate information

and consult relevant parties, some partners think

these efforts have not been wholly successful.

Earlier development and implementation of an

outreach strategy, including enhanced stakeholder

engagement, might have strengthened EBI’s

credibility with some stakeholders and facilitated

product dissemination and uptake.

■ Multi-partner initiatives can be effectively self-

regulating if certain criteria are met:

• Flexibility—a willingness to give and take was

essential for group consensus decision making.

• Transparency—progress in the EBI work plan

was simply monitored by regular meetings and

formal and informal dialogue.

• Continuity—maintenance of a consistent core

of key staff from all member organizations

strongly contributed to supporting a high level

of trust and understanding among partners.

• Commitment—willingness by each member to

persist through times of uncertainty and

discomfort enabled a successful outcome.

• Coordination—selecting one organization (i.e.

CI-CELB) to act as Secretariat provided focus,

accountability and more timely execution of

deliverables.

■ Partnerships do not need an indefinite life to have

a continued positive impact. The EBI has been the

springboard for new relationships outside the

original partnership that can help maintain EBI

momentum in the wider oil and gas industry. EBI’s

work has been taken up by more companies and

conservation organizations, particularly through

the IPIECA- International Association of Oil & Gas

Producers Biodiversity Working Group.

Conclusions

Developing guidance and recommendations in a joint

industry- NGO initiative builds on intellectual capital

and promotes greater buy-in from both sectors.

However, the EBI experience indicates that even a

major bi-sector partnership with multiple partners can

face problems in influencing wider industry and NGO

communities.

The EBI has been successful in further catalysing

and supporting interest in, and attention to,

biodiversity conservation in the energy sector. It has

contributed to EBI member companies and other

companies incorporating biodiversity more extensively

in their policies, management systems and processes.

The EBI represents an innovative and non-

adversarial approach that has delivered robust outputs

with positive potential impact far beyond that

achievable by individual participants. The inter-

organizational benefits—building constructive

relationships, understanding the motivations or

behaviour of other organizations and exchanging

information—have added value beyond development

of the EBI products themselves.


THEME: Biodiversity

PARTNERS: NGO • O&G

LEVEL: global

LOCATION: global

1 The EBI recommendations and products can be found atwww.TheEBI.org


24

Environmental preservation in the Arabian Gulf

Saudi Aramco is working with its academic and government partners

over the long term to research, protect and restore the marine

ecosystem of the Arabian Gulf.

Background

The Arabian Gulf is a major source of food, as well as of

two of the most precious and coveted resources—fresh

water and oil. The Gulf is also a highly productive body

of water with extensive coral reefs, seagrass beds, and

other marine plant and animal habitats. However, this

rich and diverse ecosystem is experiencing physical and

climatic stresses. Population growth and industrial

development, and the resulting increases in

recreational and commercial activities, have added to

the stresses on the natural resources. An understanding

of the mechanisms of environmental impacts on the

Gulf’s ecosystem is therefore required to allow for

rational development and exploitation of resources.

Saudi Aramco’s early environmental stewardship of

the Gulf started more than 30 years ago and was

demonstrated in its two publications on the marine

environment, Biotopes of the Western Arabian Gulf and

Coral Fauna of the Western Arabian Gulf. The company

continues to treat the marine ecosystem with the

utmost care and respect.

The ‘Sustaining Research Project—MarineEnvironmental Studies’ programme

To continue its stewardship, in 1984 Saudi Aramco

established a partnership with the Research Institute

of King Fahd University of Petroleum & Minerals

(KFUPM/RI) in the Kingdom of Saudi Arabia to

conduct a long-term research programme. The

collaborative research programme, titled ‘Sustaining

Research Project—Marine Environmental Studies’, has

the primary aim of documenting biological and

physical baseline conditions and recording possible

impacts and mitigations of industrial activities on the

marine environment.

The partnership maintains a group of marine

scientists able to advance the university’s research

capabilities and to respond to the company’s and the

Kingdom’s marine environmental concerns. The ‘Marine

Environmental Studies’ programme consists of marine

projects designed to be implemented in discrete

phases, each phase spanning five years and having a

distinct set of research topics.

The first phase (1984–89) of the programme

established baseline biological conditions in the

coastal bay areas and produced comprehensive

oceanographic measurements in these areas. The

scientific findings revealed both the biodiversity and

the socioeconomic significance of the bays, which are

fishing and nursery grounds for shrimp and other

commercial species. The collected information also

helped in clarifying the causes and consequences of

various changes in the Gulf.

Key partners

• King Fahd Universityof Petroleum &Minerals, ResearchInstitute (KFUPM/RI)

• Ministry ofAgriculture, Kingdomof Saudi Arabia

• National Commissionfor WildlifeConservation andDevelopment

• Saudi Aramco

KEYWORDS: marine ecosystems; scientific research

Marine scientists from KFUPM/RI studying coral reefsand other benthic organisms in the Arabian Gulf

The Gulf is a highly productive body of water withextensive coral reefs.

25

During the second phase (1990–94), more specific

investigations were carried out on operational impacts,

in particular those associated with dredging, landfilling

and marine discharges, as well as the construction of

offshore structures. Two key aspects of this phase were

the study of near-shore coral reefs and the

development of oceanographic computer models. As

part of Saudi Aramco’s marine environmental

partnership with KFUPM/RI, the company funded

development of extensive habitat maps of the Gulf

coastline from Kuwait to Tarut Bay. These maps have

been widely distributed in the country and were the

subject of an appreciation certificate received from the

Arab League acknowledging Saudi Aramco’s efforts in

‘Integrated Environmental Management and

Development of Coastal Areas’.

During the third phase (1995–2000), the

partnership programme directly addressed the

Kingdom’s environmental objectives for the protection

of the marine environment. Both Saudi Aramco and

KFUPM/RI concurred on the scientific and practical

significance of the reorientation in the research

agenda. Investigations during the third phase focused

on water-quality monitoring, transplantation of

mangrove seedlings, primary production estimates and

coral reef monitoring.

The work is continuing in the programme’s fourth

phase (2001–06).

The coral reef monitoring that began in the third

phase of the ‘Marine Environmental Studies’

programme is to continue over the long term. The

monitoring of the coral reefs in the Saudi waters of the

Gulf consists of periodic photographic documentation

of coral cover and diversity. Fish and invertebrate

populations along transects in the reefs are also

periodically counted and identified.

The mangrove transplantation project

The mangrove is more than just a tree; it is an entire

ecosystem providing habitat close to shore for fish in

particular and serving as a valuable food source.

Mangroves also help to stabilize the shoreline.

Mangrove forests once extended the length of the

Arabian Gulf but are now confined to smaller areas,

with major stands only at Tarut Bay. The virtual

disappearance of the mangrove from the Gulf coast can

mostly be attributed to landfilling for land reclamation.

Because Saudi Aramco recognizes the importance

of near-shore intertidal and shallow subtidal habitats to

fisheries production in the Kingdom, the company has

taken a special interest in ensuring the integrity of

these sensitive mangrove areas. These are the habitats

most likely to be impacted from an inadvertent oil spill.

As part of its ongoing commitment to the

environment, Saudi Aramco has adopted policies

designed to protect mangroves. In addition to large-

scale studies of existing mangroves in sheltered bays

and along the coastline, the company initiated efforts

to investigate the feasibility of transplanting

mangroves to various coastal areas where they once

grew or where none previously existed.

A transplantation project with other partners,

primarily the National Commission for Wildlife

Conservation and Development and the Ministry of

Agriculture, has met with great success. An outreach

programme educated the community about the

mangroves, and organized and carried out mangrove

transplant campaigns. More than 500 schoolboys, boy

scouts and families helped transplant thousands of

mangrove seedlings along the Gulf coastline. As a

result, the few remaining stands of mangrove trees of

10 years ago have become a flourishing area of

thousands of trees.

Conclusion

Saudi Aramco recognizes the value of working in

research and community-based partnerships to restore

and protect the marine ecosystem of the Arabian Gulf.


THEME: Biodiversity

PARTNERS: GOV • RI

LEVEL: Regional

LOCATION: Arabian Gulf

Students from localschools transplantingmangroves on the RasTanura coastline


26

Monitoring and assessment ofbiodiversity in Gabon

Shell and the Smithsonian Institution Monitoring and Assessment of

Biodiversity Program are working together to increase understanding

of biodiversity in an energy development area in Gabon, building on

a relationship that began in Peru in 1995.

Background

The capacity to develop energy resources without

harming biodiversity is increasingly necessary as

exploration and production activities in critical

biodiversity habitats become more frequent. Shell

recognizes that effective planning for biodiversity

conservation requires more than a standard

company-consultant relationship. In 1995, Shell

Prospecting and Development Peru (in conjunction

with Mobil Exploration and Production Peru) invited

the Smithsonian Institution Monitoring and

Assessment of Biodiversity Program (SI/MAB) to assist

with biodiversity assessment and monitoring at a major

natural gas field in the Camisea region of Peru. Shell’s

willingness to listen to and act on advice, coupled with

a clearly stated desire to improve operations, helped

overcome SI/MAB’s initial reservations about working in

partnership with an oil company.

In 1998, Shell withdrew its interest in the Camisea

concession, by which time SI/MAB had completed

several comprehensive baseline biodiversity

assessments and trained a large number of Peruvian

biologists. The quality of the resulting data and

SI/MAB’s training convinced Shell that continued

development of the relationship was worth exploring.

The Shell Foundation then came to the table, bringing

with it the capacity to support development of an

innovative partnership. In 1999, the way forward was

defined, with the Shell Foundation agreeing to

sponsor/co-finance work by SI/MAB in 2000–05 as part

of the piloting of the innovative business-research

model in the Gamba Complex of Protected Areas in

southwest Gabon. The Gabonese government also

provided critical support to the initiative.

The Gamba Complex of protected areas

The Gamba Complex is a protected area system that

hosts both rich biodiversity and Gabon’s largest

onshore oil reserves. Balancing energy resource

development with biodiversity protection represents a

major challenge, which the partnership sought to

address using objectives defined at the outset of the

project in a stakeholder consultation process. The

objectives were to increase and disseminate the

knowledge from the biodiversity assessments while

building the in-country capacity to conduct the

assessments, promoting links among the stakeholders

and advancing the business-research model.


Progress of the programme was monitored in regular

steering committee meetings. The meetings also gave

each partner an opportunity to discuss issues and

challenges presented by the project or the partnership.

Progress in the development and implementation

of the partnership can be measured by the quality of

the outcomes and assessment of the challenges within

the partnership itself. From an outcomes perspective,

progress has been excellent. Fieldwork has catalogued

nearly 3,000 species, with new species recorded for

fish, amphibians, reptiles, insects and trees. Thirty-two

Gabon nationals have been trained in standard

sampling protocols, and a Biodiversity Center has been

established as a science centre for Gabon and learning

laboratory for local communities. Furthermore, SI/MAB

will continue to work in the Gamba Complex with Shell

Gabon, conducting longer-term ecological monitoring

against key indicators of impacts, as well as supporting

the integration of biodiversity into Shell Gabon’s

business processes and management system.

Creating the unique partnership has been a

learning process. Initially, the partners took a cautious,

phased approach, to ensure each partner gained trust

Key partners

• Shell Foundation

• Shell Gabon

• Shell International

• SmithsonianInstitution Monitoringand Assessment ofBiodiversity Program(SI/MAB)

KEYWORDS: environmentally protected areas; in-country capacity building

27

and was satisfied with the outcomes before committing

to the next phase. As expected, significant issues and

challenges arose. Some of these have been resolved,

and some have not:

■ SI/MAB’s credibility and reputation were

questioned when it began working with industry.

■ Shell Gabon initially viewed the relationship as a

standard contractor arrangement—the partnership

idea was innovative and took time to define.

■ The partners operate within two quite different

value systems; at times there is a clash between

maintaining an objective, science-based approach

(SI/MAB) and managing operational issues and

time constraints (Shell).

■ Continuity and momentum of the partnership are

negatively affected by changes in staff position and

responsibilities. Such changes are more common in

Shell, where staff redeployment is standard

practice. New staff often require ‘nurturing’ before

they reach the same level of understanding and

enthusiasm as the staff they have replaced.

■ Despite the excellent fieldwork, the comprehensive

resulting data and the applied research in 2004–05,

using this information to modify operations,

improve biodiversity protection and reduce the

operational footprint has so far proven difficult.

Lessons have been learned as a result of the

challenges and of the increased understanding

between the partners over time:

■ Define the timing and format of outputs—ensure

every partner understands what each output will

be used for.

■ Clearly define the role of each partner from the

outset.

■ Spend more time ‘inside’ the other partner

organizations to better understand their expectations,

requirements and organizational culture.

■ Take time to anticipate as many potential issues

and challenges as possible, particularly those

related to the expectations of each partner.

■ At an early stage, establish governing principles

and performance indicators to assess the

partnership process (not just the outcomes) and

give an early indication of potential issues.

■ Exposure to knowledge can generate real change

in energy companies when the knowledge is

delivered in an easily understandable form at the

appropriate time, and when there is interest to use

the information.

■ A ‘champion’ is needed to push the biodiversity

agenda within the operational company and help

embed biodiversity in the way that the company

conducts its business.

■ Partnerships between organizations with different

cultures are hard work but ultimately deliver

multiple benefits.

Conclusions

Since its beginnings in Peru in 1995, the partnership

has continued to develop, becoming one of Shell’s

longest and most involved relationships with a

research/conservation organization. With time and

hard work, the Shell-SI/MAB partnership has gone a

long way to being a ‘successful partnering relationship’.

Despite the challenges the partnership has faced, the

proof of its success is the commitment to continue the

SI/MAB-Shell Gabon relationship beyond 2005.

Ultimately, the goal is for Shell to build on what it

has learned from this partnership and transfer

experience and knowledge to other Shell operations

and the industry in general. SI/MAB has also been

invited to discuss potential biodiversity-industry

projects in Russia and Venezuela.


THEME: Biodiversity

PARTNERS: RI

LEVEL: local

LOCATION: Africa


28

The Port-Cros National Marine Park, France

The 13-year partnership between the Total Corporate Foundation for

Biodiversity and the Sea and the Port-Cros National Park has

spawned a number of partnerships and programmes to enhance

biodiversity conservation and sustainable management of the protected

marine area around the island of Port-Cros in southern France.

Background

Port-Cros, a tiny island off the Mediterranean coast of

France, is home to the Port-Cros National Park, Europe’s

first national marine park. Created in 1963, the park

encompasses all of Port-Cros, the sea around it and

some of the mainland coast, and is a protected area of

outstanding and representative biodiversity.

The park works to conserve marine and coastal life

and raise public awareness of the diversity of fauna

and flora in and around the sea. It also assists the

Coastal Protection Agency with the scientific and

technical management of the wetlands in the salt pans

on the nearby coast at Salins d’Hyères, the site of the

old salt mines.

Each year, the national park has around one million

visitors. A major focus of the work is to help these

visitors enjoy the beauty of the park, provide them

with informative brochures, raise awareness of the

ecosystem’s sensitivity and promote behaviour change

over the long term.

The partnership

The Port-Cros National Park has been a major partner of

the Total Corporate Foundation for Biodiversity and the

Sea since 1992. The partners’ objective is to show that a

strong partnership with a common vision and involving

all stakeholders can enable successful conservation and

sustainable management of a complex marine and

coastal ecosystem subject to multiple conflicting interests,

such as those of fisheries, tourism and local communities.

The local, national and international partners have

a range of reasons for participating in the partnership

work. For example:

Total Corporate Foundation for Biodiversityand the SeaThe Total Foundation provides a forum for developing

knowledge and understanding of biodiversity and for

bringing together all parties in the quest for

sustainable development. Putting its experience into

practice, it promotes scientific programmes and

research studies in a Mediterranean marine ecosystem

of major interest.

Port-Cros National ParkThrough its partnership with the Total Foundation, the

national park has gained access to the foundation’s

experience and network of expertise in marine

conservation at the international level.

City of HyèresHyères, on the mainland across from Port-Cros, supports

the partnership work, not least because a well-

managed park can be a draw for sustainable tourism in

the region and provide a source of income for the city.

Park usersThe anglers’ interest is in protecting sustainable fishing

resources, while the divers’ interest is in maintaining the

remarkable beauty of the underwater biodiversity so that

they can continue to operate their diving businesses.

The success of the partnership has resulted from

the national park’s long-term efforts to involve local

stakeholders in the management of the park and to

build new behaviours among them. For example, the

park has encouraged divers to restrict their dives to

certain areas. Diving guidelines were first created on a

voluntary basis, and after about 10 years, in response

to divers’ wishes, were regulated and translated into

legal obligations. Diving is now only permitted within

designated areas of the park.

Key partners

• City of Hyères, France

• Coastal ProtectionAgency (Conservatoiredu littoral), France

• Conseil Général desAlpes de HauteProvence

• Conseil régionalProvence-Alpes-Côted’Azur

• Ifremer (FrenchResearch Institute forExploitation of theSea)

• NationalOceanography Centre,Southampton, UK

• Port-Cros NationalPark (Parc national dePort-Cros), France

• Total CorporateFoundation forBiodiversity and theSea

• Users of the park (e.g.anglers, divers)

• The WorldConservation Union(IUCN)

KEYWORDS: sustainable management and tourism; stakeholder engagement

Port-CrosSymposiumparticipants ©

Tot

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29

Promoting other partnerships andprogrammes

As a result of the mutually beneficial relationships built

during the past 13 years, the partnership now has a life

of its own, encouraging the partners to follow up on,

and deepen, their current activities, as well as develop

innovative projects and programmes. For example, the

Port-Cros National Park has set up a programme to

enhance knowledge of biodiversity through the

collection and conservation of several thousand

Mediterranean plants on the island, which has

increased interest in the park.

From its partnership with the Total Foundation, the

national park has also built the capacity to successfully

develop its own partnerships with local stakeholders

and therefore implement further action at the local

level. Seeking the widest possible local support, the

national park has involved local stakeholders in

designing innovative conservation measures. These

include working to eradicate toxic and invasive species

such as algae and building a new anchoring system for

ships to protect the seagrass beds on the sea floor.

The partnership has also promoted the development

of other international partnerships—for example

between the Total Foundation and the UK’s National

Oceanography Centre in Southampton (described

below)—and the involvement of other international

stakeholders in the work of developing a valid model of

conservation and management. The Port-Cros

Symposium is one such international initiative.

The Port-Cros Symposium

The Port-Cros Symposium, which is now organized

every two years, attracts participants from all over the

world and has spawned similar initiatives elsewhere.

The symposium aims to initiate discussion on, and

generate solutions for, reaching a balance between

economic growth and biodiversity conservation. The

symposium themes have been sustainable tourism

(2000), sustainable fisheries (2003) and deep-sea

biodiversity (2005).

The 2005 symposium was organized by the Total

Foundation in partnership with the Port-Cros National

Park, Ifremer, The World Conservation Union, the UK

National Oceanography Centre (Southampton) and the

Institut de Ciences del Mar de Barcelona (CMIMA–CSIC).

The symposiums have given participants the

opportunity to present projects and programmes

including, for example, the Census of Marine Life

programme—a growing network of researchers

engaged in a 10-year initiative to assess and explain

the diversity, distribution and abundance of life in the

oceans. Publishing and distributing the proceedings of

each symposium is widening the network of stakeholders

and creating additional opportunities for engagement.

As the UK National Oceanography Centre reported,

sharing experiences has resulted in identification of

synergies, commonalities and new partnerships. In this

regard, the Total Foundation will be participating in the

Census of Marine Life programme notably with the UK

National Oceanography Centre, specifically through the

Biogeography of Deep-Water Chemosynthetic

Ecosystems project, one of 14 field projects in the

programme.

The fourth Port-Cros Symposium is planned for

2007 on the theme of marine biodiversity and climate

change.

Conclusion

The partnership has made excellent progress in

biodiversity conservation, and its work demonstrates

environmental management that benefits all

stakeholders. The achievements of the partnership are

a source of inspiration and suggest a model for

conservation in marine and coastal ecosystems that is

replicable elsewhere.


THEME: Biodiversity

PARTNERS: GOV • NGO • RI • COM

LEVEL: local

LOCATION: Europe

Caulerpa Taxifolia

Port-Cros—La Palud bay

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Marine Biodiversity and Coastal Livelihoods Project in Indonesia

In 2002, Unocal (now a subsidiary of Chevron) and The Nature

Conservancy launched a partnership in East Kalimantan, Indonesia,

to build local conservation capacity, promote sustainable livelihoods

and protect the region’s valuable natural resources.

Background

East Kalimantan is home to some of Southeast Asia’s

last remaining lowland rainforests, which host diverse

primates including the orangutan. With 34,000 miles

of coastline, the islands and waters of Indonesia are

also at the heart of the world’s coral triangle,

representing 75 per cent of the world’s known corals.

Rili Djohani, Director of The Nature Conservancy’s

Indonesia Program, explains: ‘The coral triangle has the

most coral diversity in the world. For a marine biologist

this is a paradise. For a first-time diver, it’s like being on

another planet.’

Indonesia’s seas and forests offer a natural and

abundant source of capital that feeds the needs of the

Indonesian people, the region and the world, providing

timber, seafood, oil, gas, coal and minerals, including

copper and gold. The forests, seas and coral reefs also

provide vital services: absorbing greenhouse gases,

producing oxygen and clean drinking water, and

buffering the coasts. ‘In such a vast place,’ Djohani adds,

‘the threats are correspondingly large.’ Two of the biggest

threats are illegal logging and destructive fishing

practices. But another threat is more basic:

overexploitation—overuse of coastal resources

(especially fish and coastal vegetation) to meet the

needs of a growing population.

The economic realities for East Kalimantan

communities present challenges. In response to local

and foreign demand, giant sea-turtle eggs, for

example, bring up to US$17 each, a significant amount

of money in that region. What equally appealing

incentives can conservation offer residents? How can

local communities develop more sustainable economic

options for wealth generation? In biodiversity and

environmental conservation, how can business be part

of the solution?

The Derawan Islands Marine Biodiversityand Coastal Livelihoods Project

Unocal and The Nature Conservancy launched a

partnership to advance the Conservancy’s efforts and

the company’s corporate responsibility strategy. Unocal

joined the Conservancy’s International Leadership

Council in 2001.

In 2002, the Conservancy was selected as a Unocal

Foundation Special Global Partnership, which brought

corporate financial assistance and employee

involvement to the Conservancy’s ‘Ridges to Reefs’

project in East Kalimantan, Indonesia. The project’s

focus is community environmental awareness, marine

research and conservation in the Berau district and the

Derawan archipelago. The goals are to build local

conservation capacity, promote sustainable livelihoods

and protect the region’s valuable natural resources.

In East Kalimantan, the partnership established the

Derawan Islands Marine Biodiversity and Coastal

Livelihoods Project, which engages the local

community in research and conservation activities

focused on coastal resources, sustainable livelihoods

and creation of a marine protected area that will

contribute to the survival of the reef systems.

Although Berau and the Derawan archipelago are

not in the immediate vicinity of its operations, the

company does have offshore oil and gas production

facilities in the Makassar Strait. The conservation

activities provide a way for the company to learn more

about the region’s resources, local economy and

community livelihoods.

Unocal Foundation has provided partial project

funding totalling US$675,000 since 2002. Company

employees participate in planning and field visits to

gain first-hand knowledge of project activities, which

Key partners

• The NatureConservancy

• Unocal (now asubsidiary of Chevron)

• Unocal Foundation

KEYWORDS: sustainable livelihoods; education and outreach; marine protected areas

Fishing village onDerawan island

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include counting manta rays, monitoring turtle nesting

areas and disseminating conservation materials.

After assessing the partnership in 2004, the

partners renewed investments.

Benefits and outcomes of the partnership

Scott Stanley, the Conservancy’s East Kalimantan

Programme Manager, notes a challenge in Indonesia

also found in other developing countries, ‘Even when

local government is amenable to conservation activity, it

lacks funds to make significant investments of its own,

and at this point it lacks the ability to offer viable

economic alternatives. The reality is that such behaviours

cannot be changed when basic human needs are not

being met. The solutions seem easy by Western

standards, but they are very difficult on the ground.’

Stanley adds, ‘Business engagement helps. A company

can lead by example by supporting the activities of

conservation organizations and changing its corporate

practices. It can also communicate the importance of

conservation to employees, customers, suppliers, peers

and the communities where it operates.’

Josh Knights, the Conservancy’s Director of

Corporate Partnerships, says, ‘Global companies like

Unocal are taking a leadership role, supporting

conservation efforts that reach from the global

marketplace to the local community.’

Brian Marcotte, former head of Unocal’s operations

in Indonesia and later the company’s Vice President for

Public Policy, Health, Environment, and Safety,

explained the company’s rationale for involvement: ‘We

were very interested in how to create a “win-win-win”

approach—environment, community and business. One

aspiration was to involve employees actively. Such

engagement would enhance employees’ awareness and

allow our related expertise to be channelled into the

project where possible.’

Two company employees, Satria Djaya and Suta

Vijaya, were not initially convinced about

involvement, as the project ‘seemed too far away from

the company’s core area of activity’. Both now remark

on its strategic value from business and community

standpoints, and in the context of East Kalimantan’s

natural resources. The partnership has enhanced

environmental awareness among employees, fostered

better understanding of each organization’s character

and competence, and provided an opportunity for

candid discussion.

Community residents may not necessarily

distinguish between business and NGOs. Both need to

earn and keep community acceptance. Communities

want employment opportunities, and many believe

their livelihoods may be threatened by conservation

activity. Local governments also want direct,

immediate community benefits. In the partnership, the

company and the Conservancy jointly face these issues.

Unocal employee Adji Setijoprodjo helped focus

attention on these sensitivities: ‘We do not pretend to

have the answers, but deliberate efforts to engage

communities are vitally important and help ensure

long-term success.’

As one company employee reflected, three years is

not enough time to address these complex challenges.

But there are meaningful actions to take, and they

provide stepping stones to ultimate success.

Conclusions

Conservation actions in Indonesia provide hope and

perhaps models. Governments, businesses, local

communities and NGOs are developing ways to

manage resources that are ecologically sound, socially

responsible and economically viable.

‘The challenge for us always is to make people think in

a larger context than just their own reef in front of the

island,’ notes the Conservancy’s Djohani. ‘So the idea is

to have lots of dialogue on how we can implement

effective management for this large marine protected

area. Perhaps most promising, from each of these

successful projects emerges a new generation of

conservation leaders.’


THEME: Biodiversity

PARTNERS: NGO

LEVEL: local/provincial

LOCATION: Southern Asia

Dense foliage, driftwoodand palms line the coastof Kakaban Island in theDerawan island chain

Above: the coast ofSangalaki Island in theDerawan island chain

Below: fishing village onDerawan island

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Expanding a water pipelinenetwork in Egypt

A partnership between Egyptian LNG and the Behera Water and

Drainage Company led to an enlarged water distribution network

that provides mutual benefits to the companies and the residents of

the surrounding towns and villages.

Background

Egyptian LNG (ELNG) is a liquefied natural gas (LNG)

company which operates in the governorate of Behera

in Egypt. The company has five shareholders: BG Group

(35.5 per cent); Petronas (35.5 per cent); Egyptian Gas

Company (12 per cent); Egyptian General Petroleum

Company (12 per cent); and Gaz de France (5 per cent).

ELNG’s plant near the town of Idku, on the

Mediterranean coast east of Alexandria, required a

secure and reliable source of clean water for its

production process, domestic utilities and fire

emergencies. Because the volume of water required

was not available on site, ELNG studied various options

to acquire the water. It considered extracting

groundwater and treating waste water but, after some

deliberation, these options were abandoned owing to a

combination of technical, economic and socio-

economic factors. The company then approached the

municipal water facility serving the region, the Behera

Water and Drainage Company (BWADC), about drawing

water from the municipal system.

It was soon determined that the municipal water

distribution network lacked capacity to supply ELNG

with the volume of water needed for its industrial

operations. The same distribution constraints were also

preventing BWADC from supplying sufficient water to

the residences and businesses in the communities near

the ELNG facility.

BWADC was already working to expand the entire

water system. It had recently used a grant from the

Hungarian government to upgrade the system’s main

treatment station at Edfena, 12 km away on the Nile

River, as a first step in addressing the shortage. But the

necessary upgrades to the pipelines in the distribution

network were not in the budget for at least five more

years. As a result, the new potable water capacity was

‘trapped’ at the treatment station and could not be

distributed to either ELNG or the under-served

communities.

ELNG saw an opportunity to partner with the

municipal water company for a common purpose. The

LNG company had determined that building a 315-mm

polyethylene pipe would supply its needs. However, to

improve supply to the nearby towns and villages, a

12-km, 700-mm cast iron pipe was installed with a

315-mm polyethylene pipe spur off this into the LNG

plant—at an additional US$1.5 million for the

oversized pipe. BWADC was eager to lay the pipeline

and alleviate the water shortage, but the total project

cost of $4.8 million plus taxes was greater than ELNG’s

allocated budget.

After extensive negotiations, which included the

governorate of Behera, an agreement was reached.

ELNG agreed to pay the full $4.8 million, while the

municipal water company agreed to contribute the

engineering and construction workers, the machinery

and the costs of applying for legal permits for the

project as well as ongoing maintenance of the pipe.

The partnership also secured a large tax advantage

on the imported iron pipe. The Egyptian government’s

General Authority for Foreign Investment had

designated ELNG’s facility as a ‘Free Zone’, entitling ELNG

to import certain manufactured goods into the country

tax free, as long as the goods were for use at its facility.

ELNG and BWADC worked jointly with the foreign

investment authority to explain that the imported iron

pipe was primarily for ELNG’s use, with extra benefits for

the surrounding communities. The iron pipe was

subsequently exempted from taxes that would have

pushed up the cost of the pipe by 50 per cent, and the

project became financially viable for both parties.

The project enjoyed significant regional media

coverage, especially when the Behera governor

presided over the signing of the water supply

agreement. Newspapers published articles about the

successful public-private partnership, and interviews

with instrumental individuals were broadcast on

television and radio.

Two hundred jobs were created during construction

and ongoing maintenance. Technical, project

management, and health, safety and environment (HSE)

skills were transferred from ELNG to BWADC employees

and their subcontractors during the planning and

Key partners:

• Behera Water andDrainage Company

• Egyptian LNG

• General Authority forForeign Investment,Egyptian government

• Governorate of Behera

• Towns of Rashid, Idkuand El Mahmoudia,and six villages

KEYWORDS: infrastructure; community economic development; skills transfer

33

construction phases. Ongoing maintenance of the

pipeline is to be performed by BWADC, reinforcing the

skill transfer process. In addition, permits for river and

railway crossings were granted on time, as the

authorities recognized the positive outcomes of the

project and were eager to assist.

The work was completed ahead of schedule and

below the approved budget. The project has increased

the water supply to the nearby towns and villages by

50 per cent, benefiting 405,200 end users.


All the parties involved in the construction of the water

pipeline learned a great deal about community

development and public-private partnerships.

Although ELNG seeks ways to help develop the local

communities in which it operates and plans for many of

its social investments, it had not anticipated that the

pipeline project would be a community development

effort. ELNG learned that it can be beneficial to be

pragmatic about community development initiatives,

because opportunities frequently arise that may be

more worthy, more necessary or more sustainable than

other alternatives. The pipeline evolved into a

community development project when ELNG and the

municipal water company recognized that both would

benefit from working together.

The success of the project is due, in part, to the

balanced engagement of private sector and public

sector organizations. This balance made it possible to

divide responsibility for financing and delivering the

project; neither could do everything alone. This

efficiency in turn reduced costs and made the project

financially viable.

The partners learned that effective community

development projects require extensive dialogue and

negotiations. Without such dialogue, ELNG would

probably have constructed a smaller polyethylene

pipeline fitted only to its own needs, and the water

company would have gone without the upgrade to its

network. The dialogue was not always straightforward,

however. When the time came to draft the working

contract between the two parties, it became clear that

ELNG was accustomed to establishing many (lengthy)

written rules and guarantees, while the water company

was used to simpler, one-page agreements.

This was also the first public-private partnership

that both parties had entered into, and it took extra

time to reach agreement on a unit price for water over

the 20-year project life, given that rates would escalate

with inflation and because each party had different

pricing methods and expectations. Despite these

complications, the dialogue and negotiations persisted,

and a fruitful project was eventually realized to the

satisfaction of both parties.

Conclusion

Through extensive negotiation and cooperation, the

partnership managed to efficiently divide the project

responsibilities between the public and private sectors

to the mutual benefit of all involved. Besides an

expanded water supply, the project delivered

significant socioeconomic benefits such as good jobs

and the transfer of skills.


THEME: Capacity building

PARTNERS: GOV • O&G • B&I • COM

LEVEL: local

LOCATION: Africa

Laying and backfillingthe polyethylene pipe


34

Building NGO capacity for pipeline monitoring and audit in Azerbaijan

In Azerbaijan, BP and the Open Society Institute-Assistance

Foundation are working together to support national NGOs’ capacity

development through facilitated monitoring and audit of the

Baku-Ceyhan-Tbilisi and the South Caucasus Pipeline projects.

Background

The Baku-Tbilisi-Ceyhan (BTC) project represents a

US$3 billion investment to unlock energy from the

Caspian Sea, with the construction of a 1,768-km oil

pipeline from Azerbaijan, through Georgia and on to

Turkey, for onward delivery to world markets. The

South Caucasus Pipeline (SCP) runs parallel to the BTC

pipeline and will transport gas from the Caspian Sea to

the Georgia/Turkey border.

BTC (and SCP to a lesser extent) has been subject to

an unprecedented degree of monitoring by

international and national bodies wishing to assess the

project’s openness to public scrutiny and compliance

with international standards.

BP initiated a partnership with the Open Society

Institute-Assistance Foundation (OSI-AF) to provide

training, mentoring and facilitation to the NGOs doing

the monitoring in Azerbaijan. OSI-AF’s main goal is to

foster the transition of a closed society to a more open

one. Farda Asadov, OSI-AF’s executive director, explains:

‘In Azerbaijan our aim is to increase civil society’s

involvement in the democratic process and to oversee

good governance and transparency in the use of national

resources.’ The partners signed a Memorandum of

Understanding (MOU) and commenced the NGO

Monitoring Programme in April 2004.

The NGO Monitoring Programme

The NGO Monitoring Programme was to focus on five

key areas: environment; social issues; human rights;

historical, cultural and archaeological heritage; and use

of local suppliers for goods and services. Key objectives

of the programme were to:

■ develop the proficiency of local NGOs in

conducting effective BTC pipeline monitoring;

■ introduce successful international monitoring

standards and practices to Azerbaijan; and

■ improve BP activities in Azerbaijan via feedback

from the NGO monitoring process.

OSI-AF and BP were keen for the process to be as

inclusive as possible. A self-selection process involving

all 88 programme applicants resulted in 27 NGO

representatives divided into five Working Groups

covering the five key areas. It was apparent from the

outset that many of the Azerbaijan NGOs needed help

to develop skills in methodology, planning, data

collection and audit analysis, interview techniques,

report writing and presentations. BP provided OSI-AF

with funds to organize the necessary training and

mentoring components of the programme, while

OSI-AF met the other costs.

During the programme, the NGO representatives

visited more than 100—or approximately 75 per

cent—of the communities situated along the pipeline

in Azerbaijan. The NGOs published their findings in May

2005 and reviewed them in meetings with OSI-AF and

BP. Dan Bliss, BP’s Community and NGO Programmes

manager, reflects: ‘The process of this dialogue was the

most important thing. We were able to discuss issues with

the NGO participants in a very constructive way. We were

in a dialogue as equals.’ However, the dialogue with

NGO representatives, many of whom were initially

hostile towards BP, took time and effort, especially to

develop trust and to become productive.

This NGO initiative provided local insights on how

to improve project performance. The recommendations

that BP agreed to take on board include ensuring that

Key partners

• BP

• Open SocietyInstitute-AssistanceFoundation

• Local NGOs

KEYWORDS: international monitoring and audit practices; transparency; good governance

BULGARIA

Istanbul

TurkishStraits

MEDITERRANEAN SEA CYPRUS

Ankara

TURKEY

Ceyhan

SYRIA

Erzurum

GEORGIA

IRAQ

RUSSIA

ARMENIA

Tblisi

IRAN

AZERBAIJANTURKMENISTAN

KAZAKHSTAN

Supsa

Novorossiysk

BLACK SEA CASPIAN

Baku

Sangachaly

ACG

The BTC pipeline runsfrom Baku inAzerbaijan, throughGeorgia and on to theTurkish Mediterraneanport of Ceyhan.TheSCP pipeline follows thesame route as far as theGeorgia/Turkey border.

35

local communities are aware of the avenues to

communicate their concerns to the company; increasing

and focusing efforts to address community concerns

about pipeline safety and security; and strengthening

efforts to procure goods and services locally.

Each party contributed significantly to the process:

■ OSI-AF was the facilitator and an independent and

well-informed link with civil society and BP;

■ the NGO representatives provided a local perspective

on how BP could improve its performance and

establish broader links with civil society; and

■ BP contributed project management skills and the

information the NGOs required to play a

constructively critical role.

A new cycle focusing on the South Caucasus

Pipeline (SCP) was launched in August 2005 to promote

transparency, to identify opportunities for

improvement in how BP manages the environmental

and social impacts of its investments in Azerbaijan, and

to introduce NGO representatives to the principles and

practice of auditing. The aim is to build local capacity to

audit large infrastructure projects such as BTC and SCP.

Challenges and lessons learned

The partnership has been a big learning experience for

all parties. One challenge was addressing OSI-AF’s

concern about its reputation—how the external

community and civil society would perceive its

‘partnering with an oil major’. Another challenge was

meeting OSI-AF’s need to involve the broader NGO

community in building consensus. With the two

organizational cultures of BP and OSI-AF being so

distinct, both parties took a cautious approach and had

to compromise and exercise dialogue and patience to

achieve a common goal.

By the end of the first cycle, both parties realized

that the original MOU was not sufficiently detailed to

reflect some of the programme’s management

challenges. For instance, the time and resources

required from all parties in such areas as training,

planning, data gathering and report preparation were

drastically underestimated. A more focused and

specific MOU was developed following a BP and

OSI-AF exercise of ‘lessons learned’ to identify areas of

improvement—for instance, more clearly defining

roles and responsibilities, improving the selection

criteria for new participants and enhancing OSI-AF

management capabilities.

Conclusions

The BP and OSI-AF partnership continues to evolve. It

has required time and hard work on the part of all

involved to make the partnership a success, but it

represents a good example of how international

companies and national NGOs can work together

towards a mutually advantageous goal.

The capacity-building element of the programme

has resulted in the emergence of an ‘advanced group’

of civil society representatives that will use their skills

for other initiatives. Examples of projects where NGOs

will apply their knowledge are the EU’s European

Neighbourhood Policy Civil Society Forum and OSI’s

Revenue and Civil Society participation in the

Extractive Industries Transparency Initiative (see the

EITI case study on page 92). As Julie McCarthy, director

of OSI’s Revenue Watch programme, indicates, ‘The NGO

Monitoring Programme, while by no means perfect, is

certainly one of the best examples to date that civil

society, extractive industries and the host government can

point to as a mutually beneficial endeavour. BP can

attempt to replicate the monitoring programme in other

key countries of operation.’



PARTNERS: O&G • NGO

LEVEL: national

LOCATION: Caspian

Pipeline monitoring teamin Azerbaijan


36

Sustainable development in the Gulf of Paria, Venezuela

ConocoPhillips has lessons to share from conceptualizing, improving

and implementing a sustainable development framework in

collaboration and partnership with local and international stakeholders

in the Gulf of Paria in Venezuela.

Background

ConocoPhillips Venezuela and its partners discovered

offshore oil resources in the Gulf of Paria, Venezuela, in

1999. Plans are to begin production in the near future

and to remain in the area for more than 20 years.

The Gulf of Paria is an environmentally sensitive

estuarine region with high biodiversity. Communities

including indigenous Warao and fishermen rely on the

natural resources. Initial evaluations and meetings with

stakeholders identified many needs among those living

closest to the future oil operations, including income-

generating opportunities, education, skills and basic

services. However, the lack of an organized and

empowered community, a high staff turnover rate within

institutions and low capacity were seen as jeopardizing

investments. Efforts in the 1990s to improve conditions

heightened local expectations and communities became

accustomed to infrastructure donations and handouts.

The Sustainable Development Framework

To meet these complex challenges, in 2000

ConocoPhillips designed a sustainable development

framework with input from communities and local,

national and international stakeholders. The goals of

the framework were to:

■ establish and maintain a vision and principles for

how ConocoPhillips implements oil and gas

activities and investment programmes in the

region;

■ select, execute and monitor the investment

programmes to ensure that they fit regional

priorities and have tangible, near-term benefits for

key stakeholders;

■ establish, over the longer term, a common vision

for development among stakeholders; and

■ integrate feedback and continuously improve the

overall framework.

Progress

With the input of about 15 local and 40 international

stakeholders, ConocoPhillips has conceptualized and

executed more than 20 programmes in environmental,

socio-economic and operational areas since 2000. In

some cases, the collaboration has evolved into formal

partnerships with resource-sharing agreements:

Empowering Guiria fishermen to becomeentrepreneurs Since 2001, ConocoPhillips has worked with a local NGO,

the Venezuelan government and the fishing community

to deliver a comprehensive educational programme to

members of a fishermen’s association. In 2005, the

regional government donated a fish-gathering facility

to the fishermen. Fishermen leveraged this new asset

and transformed their association into a successful,

community-managed enterprise benefiting 600

people. ConocoPhillips plans to replicate this

partnership in other parts of the Gulf of Paria.

Putting Gulf of Paria biodiversity on the map Following a year of dialogue, in 2003 ConocoPhillips

signed a Memorandum of Understanding with

Conservation International to conduct and disseminate

studies, raise awareness and achieve consensus on

conservation priorities among more than 20 cross-

sector organizations. The partners published a

biodiversity action plan in 2004 and are now exploring

the feasibility of a community-based biodiversity

monitoring programme. In parallel, an agreement was

made with the Ministry of the Environment and the

United Nations Development Programme to work on a

regional conservation initiative for the Orinoco Delta.

Building capacity In 2003, ConocoPhillips partnered with the Inter-

American Foundation, and contracted the Synergos

Institute and local consultants to address the long-term

goal of encouraging local stakeholders to participate in

the development of the Gulf of Paria. Organizations

jointly assessed the community’s ability to identify

regional priorities, summon interest groups, raise funds

and allocate resources. In 2004, ConocoPhillips

convened workshops to explore ways to increase

community and institutional capacity and improve the

Key partners

Multiple local andinternational stakeholders,including:

• Communities

• ConocoPhillipsVenezuela

• ConservationInternational (CI)

• Inter-AmericanFoundation

• Ministry of theEnvironment andother governmentinstitutions

• United NationsDevelopmentProgramme (UNDP)

KEYWORDS: biodiversity; community development; health; oil spill response and planning

The lessons welearned from

implementation

Input fromstakeholdersand resultsof studies

ConocoPhillips• core values• policies• experience

Our LocalityManagement Strategy

Programmeimplementation

Evaluating programmeachievements

Stakeholder engagement,collaboration andpartnering are central toConocoPhillips’ approachto sustainable developmentin the Gulf of Paria.

37

quality of life in the gulf. Results of this participatory

process are being used to refine the company’s

2006–08 sustainable development investments.


Early engagementIt is challenging to justify partnership exploration during

project planning. However, an early start increases the

chance of creating partnerships built on mutual and

strategic interests, rather than collaborations compelled

by controversy later in the project cycle. It also provides

time to explore desired outcomes, co-design strategies

and ‘test’ competencies prior to a formal agreement.

Common interestsDifferences in the level of understanding of issues and

lack of shared interests or perceived benefits hinder

partnership exploration and building. It is necessary to

accentuate areas of overlapping interests and to ensure

that benefits for each party outweigh burdens.

Community participationCommunity involvement is crucial to the long-term

viability of investments, but communities are unlikely

to participate unless they perceive benefits. Cross-

sector alliances structured around a local productive

activity with rapid and tangible economic benefits are

particularly successful at involving the community.

Institutional participationPartnerships should not encroach on the role of the

government; they should consider the government

investment focus—or gaps—in deploying resources.

RolesThe roles and responsibilities of the different

organizations need delineating early, to avoid

misrepresentation, minimize redundancy and

optimize resources.

CommitmentWillingness to dialogue should not be mistaken for

interest in partnering. Ownership and responsibility

partially result from the contribution of resources (in

kind, financial or other) commensurate with the size,

nature and means of each partner.

CapacityPartnership building is often challenging because of

the differing capacity of those involved. Training and

educational programmes can empower communities

and local institutions to assume their roles in

sustainable development.

Governance/operational differencesIntrinsic administrative and operational differences

between NGOs, government institutions and companies

can complicate working together. Organizations should

remain flexible to the procedures of others.

Competition/creditCompetition can hinder partnership building. Some

stakeholders may opt to create their own programme

instead of joining a well-established partnership.

Others may compete for a place in the partnership for

the financial leverage that this could represent.

Collaborative opportunities for investment can offer

synergistic benefits that outweigh competitive gains

from independent action.

ChampionEstablishing partnerships invariably requires a

‘champion’ organization, usually the first to perceive

common possibilities. This organization should be

prepared to invest more time and resources during

partnership exploration, until others see the full value

of their involvement.

Conclusion

Partnerships depend on mutual understanding and

trust, which naturally take time to develop. It is

therefore crucial to select the ‘right’ individuals capable

of inspiring, leading and instilling a sense of shared

purpose through frequent, preferably in-person,

communications, while allowing the time needed to

nurture lasting cross-organizational relationships.

For more information on the partnership work see

www.ConocoPhillipsParia.com



PARTNERS: GOV • IGO • NGO • RI • COM

LEVEL: local/national/international

LOCATION: South America

ConocoPhillips hasconceptualized andcarried out more than20 programmes inenvironmental,socio-economic andoperational areassince 2000.


38

The Emergency MedicineDevelopment Initiative in Azerbaijan

Hess, International Medical Corps and other partners are working

together to improve emergency health care services for communities in

and around the Baku-Tbilisi-Ceyhan (BTC) and South Caucasus

Pipeline (SCP) corridor in Azerbaijan.

Background

In 2003, Hess approached International Medical Corps

(IMC) to identify a project that would have a long-

lasting, positive impact on north-west Azerbaijan. The

partners developed the Emergency Medicine

Development Initiative (EMDI) to address road

accidents and other emergencies, among the leading

causes of morbidity and mortality in Azerbaijan.

The Emergency Medicine DevelopmentInitiative

The EMDI has improved patient outcomes and access

to effective emergency medical care provided by well-

trained and equipped physicians and nurses. The

initiative is focused on First Medical Emergency

Hospital No. 3, the main emergency hospital serving

Ganja (the second-largest city in Azerbaijan) and the

surrounding districts, which was in poor condition. The

three main objectives of Hess and IMC were to:

1. improve the skills of emergency medical personnel;

2. improve the infrastructure of the emergency

department and emergency surgery ward; and

3. provide new medical equipment, pharmaceuticals

and supplies.

The initiative was implemented in partnership with

the Ministry of Health, the Ganja Executive Committee,

the hospital and Ganja residents. The beneficiaries of

the EMDI are the more than one million people living in

Ganja and the surrounding districts. Additional

beneficiaries are hospital staff, employees working near

the BTC/SCP pipeline corridor and travellers on the new

Silk Road from Baku to Tbilisi (Georgia) via Ganja.

Progress

Johns Hopkins University emergency medicine experts

provided advanced training for the hospital’s

emergency medical team, as well as medical staff from

McDermott (an engineering firm working on the

pipelines) and doctors from the national landmine

removal programme. The hospital’s emergency

department was completely rehabilitated and

specialized equipment provided.

Hess’s support included developing project

workplans, implementing civil works and construction,

and obtaining the necessary government approvals. In

contrast to many development projects where donors

commit to funding technical support and training only,

Hess funded the full spectrum of needs, including

equipment and construction costs.

Widespread consultation with local stakeholders in

the community greatly increased the likelihood of

long-term sustainability for the initiative, with local

support leveraged from the very early planning stages.

The local community provided 25 per cent of the

project costs, including building materials, skilled and

unskilled labour, transportation services and cash

contributions.

Key partners

• Hess

• First MedicalEmergency HospitalNo. 3, Ganja

• Ganja ExecutiveCommittee(governor’s office forthe Ganja region)

• International MedicalCorps

• Johns HopkinsUniversity, BloombergSchool of PublicHealth and School ofMedicine

• Ministry of Health,Azerbaijan

KEYWORDS: pipeline construction; emergency medicine; training

An example of theimprovement in thequality of the hospitalwards at the Ganjahospital: the photographimmediately right showsone of the wards beforethe partnership project;the photograph on the farright shows how thewards look today.

39

NGOs working in Azerbaijan also contributed to the

initiative. The high degree of local support encouraged

the Azerbaijan government to recognize the value of

the project, assist with the hospital renovation and

revisit the national policy on accident care.

Challenges

The key challenge early on was to create a cohesive

project team from culturally diverse organizations.

Significant patience and team building were required

during the first months of the initiative to create the

necessary confidence and mutual respect to move the

project forward and to cement the new working

relationships.

The project team also faced an initial learning

curve in terms of financial reporting and project

implementation. Some key hospital staff, for example,

debated which parts of the hospital were priorities for

repair and which equipment was essential to meet the

project’s objectives. In addition, there was some

difficulty early on in securing assistance from regional

health authorities, as well as in controlling expectations

of both the regional government and the hospital

administrators.

Constant contact and close coordination between

Hess, IMC, regional health authorities and hospital staff

helped build confidence and trust. The arrival of

building materials on site and the commencement of

construction activities marked a key milestone, after

which came significant support from government

authorities and hospital staff.

Lessons learned

Including regional health authorities on the project

team was fundamental to overall success. It not only

helped with approvals to remodel the hospital, but also

created government ownership and commitment to

maintain the physical infrastructure and care for the

new equipment.

Similarly, securing buy-in and support from the

hospital administrative team was also vital to the

project’s success. Since all major decisions were made

as a team, the hospital staff rapidly acquired

confidence in the overall direction of the project and

increased their sense of ownership.

Conclusions

Hess and IMC worked in partnership with national and

international agencies to raise the quality of

emergency medical services at First Medical Emergency

Hospital No. 3. They provided modern training, life-

saving equipment and medicines to a once-dilapidated

emergency department that each year will benefit

thousands of people living in north-west Azerbaijan.

An important outcome of the EMDI is that its

success has sparked greater interest in emergency

medicine by other donors. As a result of the work of

Hess and its partners, the United Stated Agency for

International Development (USAID) approached IMC to

design an expansion programme for the EMDI in

partnership with corporate partners under USAID’s

Global Development Alliance mechanism.

In September 2005, Phase II of the EMDI was

launched. A much larger project, its budget is US$2.1

million over two years. Funders are USAID, Hess, Unocal

(Chevron), BP and the BTC/SCP Company. The scope of

the work and the geographic coverage have also

expanded, to cover five hospitals located along the

BTC/SCP pipeline route, to create national emergency

medicine training centres and to improve national

policy on emergency medicine services—in particular,

ambulance and in-hospital care.



PARTNERS: GOV • NGO • B&I

LEVEL: local

LOCATION: Caspian

Ganja hospitaladmission facilities, beforeand after the project


40

The Ormen Lange Slide Risk Project

Hydro and a group of universities, institutes and companies

collaborated in order to better understand the geology and historical

subsea slide mechanisms in the Storegga region on the Norwegian

continental margin.

Background

The Ormen Lange field is Norway’s second-largest gas

discovery. It is located off the north-west coast of

Norway within the scar of the Storegga Slide, which

took place about 8,200 years ago and is one of the

largest known submarine slides in the world. It created

tsunamis that reached the coast of Norway, Scotland,

and the Shetland and Faroe islands.

When the Ormen Lange licence was awarded in

1996, knowledge about the Storegga Slide was limited.

Also, the stability of the seabed in this area and the

timing and number of slides were uncertain. Risk

relating to development of the Ormen Lange field in

the slide area had to be assessed before the

development could be declared safe and feasible.

Questions concerned the slope stability, the probability

of a new large slide and the risk of tsunami.

Hydro decided to resolve these questions through

the ‘Ormen Lange Slide Risk Project’, a major joint effort

between industry and academia that ran from 1997 to

2003. The project involved national and international

research institutes and universities. Some parts of the

project were included in the Norwegian Deep Water

Programme, while other parts were performed in

cooperation with EU-funded projects.

The Ormen Lange Slide Risk Project

The mapping of slides and evaluation of slide risk

started in 1996, after the first deepwater licences were

awarded in the Møre/Vøring area. The Ormen Lange

project partners then conducted comprehensive data

acquisition, from 1999 to 2003, to establish the

database needed for the slide risk assessment. The

fieldwork included acquisition of seismic data, seabed

mapping, geological and geotechnical borings, in-situ

pore pressure measurements, seabed sampling for

dating and video inspections. In addition, mapping and

coring in fjords, lakes and bogs helped date earlier

tsunami events.

The study was complex, as many disciplines were

involved, and its conclusions were vital for the

development of the major gas field. The partners

therefore established an independent ‘verification

team’ of experts to follow up on the work. SINTEF (the

Foundation for Scientific and Industrial Research at the

Norwegian Institute of Technology) was contracted to

establish and lead the verification team.

The verification team had the freedom to deal with

those items that it considered as most critical. On two

occasions, the team was strengthened with additional

members as new issues came into focus. The expert

team comprised 17 individuals from 8 institutions in

Europe, Canada and the USA.


During the Ormen Lange project, workshops were

organized at least annually to monitor the progress of

the work. The workshops also gave participants an

opportunity to discuss issues and challenges that they

and the whole group were facing.

Particular features of the project required special

consideration—for example:

1. Working with several alternative explanation

models simultaneously was extremely useful,

however, it required significant resources (e.g. to

conduct additional fieldwork) to decide on the

most suitable model. Working in a large

partnership between academia and industry

increased the access to a wide range of expertise,

as well as to financial resources.

2. As a result of the multidisciplinary nature of the

project, the scope of the work expanded over time.

This ‘rolling snowball’ effect made long-term

planning difficult, and mobilization of

computational tools to comply with the expanding

scope sometimes required extensive effort. Again,

the partnership offered pooling of resources and

thereby easier adaptation to changes in the scope.

3. Key persons within the project experienced

significant long-term strain, as they were not

initially prepared for the increased project scope

during the later stages. Although budgets to

increase the resources were available and resources

Key partners

• British GeologicalSurvey

• Geological Survey ofNorway

• Hydro

• NORSAR

• NorwegianGeotechnical Institute

• Scandpower

• Svitzer

• University of Bergen

• University of Oslo

• University of Tromsø

KEYWORDS: gas field development; geological risk; research and development; external verification

41

were added when possible, the complex nature of

the project represented a challenge with regard to

knowledge transfer and update of new personnel,

especially in the later stage of the project.

4. The partners operate with different types and levels

of quality assurance and quality control systems

that are generally incompatible. Introduction of a

verification team proved to be useful in this

connection.

Main lessons learned from challenges during the

project are as follows:

■ It is important to avoid bottlenecks in the flow of

information between the partners, not least when

deadlines are tight. The expected output from each

partner should be clearly defined at all stages.

■ Exchange of information should serve a purpose.

Intermediate and ad hoc specialized workshops or

project meetings involving only a subset of the

partners can be efficient ways of ensuring this

exchange.

■ The role of and efforts required from each partner

should be clearly defined from the outset. The roles

may have to be redefined if the scope of the work

changes.

■ The partnership involved organizations with

different ‘cultures’, which represented both a

challenge and a source of mutual inspiration and

exchange of skills.

Conclusions

The project was able to conclude that developing the

Ormen Lange field was safe with respect to geohazards,

and that the development would not cause

unacceptable risk to third parties. The conclusions were

verified by an international verification team

comprising specialists in the relevant areas.

The study was unprecedented as a field

development site survey, not only in its size and its free

exchange of data, but also in its use of external parties

(the verification team) to guide the research.

The project helped build expertise in academia as

well as in the industry. This expertise is now applied to

evaluate geohazards for other developments along

continental margins. The results of the study have also

been extensively disseminated via journal articles and

conference papers, including special issues of selected

journals.

The development of Ormen Lange was dependent

on a scientifically based and publicly accepted

declaration that the area was safe from future slides.

This assurance could only be achieved through a

partnership, as no single academic institution had

sufficient breadth of expertise. It was equally important

that all questions that could be raised were raised and

resolved within the project. The partnership ensured an

open and transparent process between the academic

institutions and industry.




LEVEL: regional

LOCATION: Europe

Location of the Storegga Slide on theNorwegian Continental Shelf, with the slidefanning into the deep Norwegian Sea.TheOrmen Lange field is located at the head ofthe slide scar.


42

Oil industry workforce development in Yemen

Canadian Nexen Petroleum Yemen has partnered with local and

national governments to build the skills of Nexen’s employees, in the

process developing Yemen’s oilfield expertise for the long term.

BackgroundSince Canadian Nexen Petroleum Yemen’s (Nexen)

entry into Yemen in the early 1990s with its Masila

Block project, a large-scale, multi-million-dollar oil

exploration, development and terminal operation, the

Yemeni workforce at this facility has grown to exceed

expatriate employees and now accounts for more than

70 per cent of the operational workforce.

Nexen’s partnership and profit-sharing agreement

with the Ministry of Oil & Minerals included a

development plan with the regional Hadhramout

Governorate to enhance local economic growth and

build the capacity of the local population.

The partnership evolved from its origin in the

profit-sharing agreement, to a process of engagement

with local and regional stakeholders, to develop the

capacity and capabilities of Yemen’s national oil

industry and to involve them in the staged growth of

national employees through what would become

Nexen’s ‘Yemenization’ programme.

The training and Yemenization programme

Nexen’s Yemenization programme is designed to

increase the percentage of Yemenis in the company’s

workforce by recruiting them and then engaging them

in a formal training and development programme

called the Individual Development Programme (IDP).

The localization programme also seeks to enhance the

professional development of Yemenis in the oil and gas

industry in their country.

In the IDP, every national employee has a tailor-

made plan that identifies the employee’s specific

training and development needs. Each employee’s

progress is monitored and mentorship is provided to

guide that employee’s development. Upon successful

completion, national employees may be promoted to

replace selected positions held by expatriate staff.

Nexen has training facilities at all three of its main

locations: the central processing facility (CPF), the marine

export terminal (Terminal) and the office at Sana’a,

Yemen’s capital. The main Training Centre is located at the

CPF and consists of a variety of classrooms as well as shop

facilities. The Terminal and Sana’a facilities have multi-

purpose classrooms and computer training facilities.

The training programme at Nexen has four levels:

■ Level 1: The new trainee begins the technical

courses and also enters an intensive English

language instruction programme. The need for a

single working language is emphasized for

operational and safety reasons.

■ Level 2: The trainee selects a discipline (operations

vs. maintenance) and commences intensive study

of theoretical and practical aspects of that

discipline. Simultaneously, the Environmental

Health & Safety department provides a full range of

mandatory training.

■ Level 3: The trainee is relocated to the relevant

department and assumes the daily requirements of

the job, with mentoring and supervision.

■ Level 4: The trainee reaches the target level for

Yemeni employees and can function independently

in the position.

Flexibility in the programme allows Nexen to reduce

the length of training time considerably, if the trainee’s

abilities allow for it. Not all training can be given at the

training centres; some specialized training is held off-

site or out of country as required, and often subject-

matter experts are brought in to conduct training.

Periodic evaluations are done on the training

programmes in Yemen, to ensure that they meet the

standards and objectives set.

Key partners

• Canadian NexenPetroleum Yemen

• ConsolidatedContractors Company

• HadhramoutGovernorate, Republicof Yemen

• Ministry of Oil &Minerals, Republic ofYemen

• Occidental Peninsula Inc.

KEYWORDS: development of local workforce; training; stakeholder engagementYe

men

i nat

iona

ls (%

of w

orkf

orce

)

2000 2001 20020

20

40

60

80

2003 2004

Yemeni nationals nowcomprise 77 per cent ofNexen’s workforce(including contractors) atMasila, continuing anupward trend. In Yemen,Nexen employs almost1,000 people.

Yemeni nationals in the Masila block workforce, 2000–04

43

With high unemployment and a minimum of

technical opportunities in the area, recruitment is

managed through an operating committee, to ensure

fair and equitable allocation of positions to qualified

individuals. Nexen’s human resources division works

closely with the governorate and with the oil ministry’s

Yemenization manager to advertise, test candidates

and fill positions as they become available.

Taking this work further, in 1998 Nexen and its

partners in the Masila Block project adopted a

scholarship programme in Yemen designed to enhance

national capacity by providing scholarships to Yemeni

students to pursue post-secondary studies at Canada’s

University of Calgary or the Southern Alberta Institute

of Technology, in disciplines that will positively impact

economic development in Yemen.

Upon graduating, these students return to Yemen

to take on positions external to Nexen, filling both a

societal need and building Yemen’s national capacity.

The scholarship programme exemplifies the strong

partnership between the government of Yemen, its

people, Nexen and its Masila Block partners.

Progress

Since the start of the Masila Block project in the early

1990s, the number of Yemeni nationals employed at

Nexen has increased significantly. These employees are

also more skilled and hold more responsible positions

within the company. In Yemen, Nexen employs almost

1,000 people.

For the continued success of the programme,

Nexen and its partners conduct regular stewardship

meetings and work from a business plan that is

updated and approved annually. The increasing

localization will continue as long as Nexen is a partner

in the Masila Block project.


As with any regulated programme, flexibility, equity

and transparency are issues that need to be faced in a

collaborative and open environment if the programme

is to be successful and sustainable.

Working closely with its partners and the operating

committee, Nexen has been proactive in understanding

issues associated with culture, language, customs,

nepotism and education, to bring balance and a long-

term vision of success to the programme.

Capturing and sustaining a culture of safety and

environmental stewardship in the absence of specific

regulation necessitated new and innovative ways to

train and communicate.

Critical to the success of this public-private

partnership was (and is) transparency and a willingness

to work with regional governments, local customs and

the Yemeni culture. Nexen learned early in the process

to be open and responsive to the suggestions of its

partners (government) and to treat these opportunities

as gateways to lasting relationships.

Conclusions

The Yemenization programme helps ensure continued

safe and effective operations, and is building an

experienced oilfield workforce as a lasting legacy once

Nexen completes the terms of its current production-

sharing agreement with the Yemeni government. Nexen’s

commitment to this programme has resulted in a positive

and lasting relationship of trust and cooperation with the

government of Yemen and its people.




LEVEL: national

LOCATION: Middle East

EN

TR

Y

OR

IE

NT

AT

IO

NFJQ

PJQ

PJQ

FT

FJQ = fully job qualified PJQ = part job qualifiedFT = full-time trainee OJT = on-the-job trainee

FU

LL

Y J

OB

EX

PE

RE

NC

ED

Low tech.

Low English

sk

ills

la

dd

erOJT

OJT

OJTFTtraining

FJQ

FJQ

FJQ

Level 1 Level 2 Level 3 Level 4

IND

IVID

UA

L D

EVEL

OPM

ENT

PAN

Far left: Nexen’sIndividual DevelopmentProgramme (IDP) hasfour basic levels:1. Level 1: entry;2. Level 2:training for a

specific trade;3. Level 3: on-the-job

training; and4. Level 4: individual

development plan(IDP).

Near left: the programmeprovides extensive hands-on practice, both in theworkshops and the field.

Nexen’s Individual Development Programme (IDP)


44

Sustainable harvesting of biodiversity resourcesat Flower Valley, South Africa

Through a fusion of conservation expertise, financial investment,

business skills and long-term access to consumer markets, Shell and its

partners are working in South Africa to conserve biodiversity, generate

jobs, and improve the quality of life for local people through the

sustainable harvesting and sale of flowers and associated products.

Background

South Africa’s Cape Floral Kingdom is one of the world’s

most botanically rich habitats, with nearly 70 per cent

of the plant species found nowhere else on Earth. It is

home to the heath-like fynbos (or fine bush) vegetation

belt, the global record holder for floral diversity.

However, the fynbos is at great risk from agricultural

(for example vineyards) and urban development,

commercial tree planting and invasive plant species.

Reducing the pressure on this unique habitat in a way

that could also deliver social and economic progress in a

low-income, high-unemployment area was the challenge

that the Flower Valley project sought to address.

Between 1999 and 2002, with the support of

various donors, Fauna and Flora International (FFI)

purchased 1,338 hectares of globally important fynbos

land including Flower Valley Farm, a pre-existing

flower-harvesting operation. FFI then established the

Flower Valley Conservation Trust (FVCT) to take on

ownership and assess opportunities to link

conservation and local economic development

strategies through the sustainable use of natural

resources. FFI introduced Shell to the project, and the

company quickly recognized that a strong trading

operation would support the conservation and

community initiatives in Flower Valley.

Development of the partnership

The project has evolved in two distinct phases, involving

two overlapping sets of partners. In the first phase

(started in 2002), Shell South Africa, Shell International

and FVCT worked together to improve the flower

production process and develop a business model that

cultivated downstream retail outlet opportunities at

Shell retail stations in South Africa and the UK while

addressing conservation and local poverty issues. Shell

also contributed almost US$ 258,000 over three years to

support the management of FVCT and purchase much-

needed equipment at Flower Valley Farm.

The second phase began in 2003, when changes in

South African tax legislation required FVCT to separate

its non-profit and commercial activities. Fynsa (Pty) (Ltd)

was created when a group of UK-based investors

bought the business from FVCT. Shell Foundation came

into the project, motivated by an opportunity to

develop increased market access in an environmentally

and socially sustainable fashion in an area with high

unemployment rates.

The Shell Foundation’s innovative partnership with

Marks & Spencer (M&S) is being used to facilitate access

to a much larger retail market. The Foundation is

assisting Fynsa to build both its capacity and its ability

to meet M&S supplier standards, and also helping fund

around 15 neighbouring farms to meet international

labour standards, supply Fynsa with flowers in

accordance with M&S standards and meet South

African conservation agency CapeNature’s best-practice

criteria for harvesting in the wild.


Partnerships sometimes come together quickly in

response to an urgent issue (in this case, dual

conservation and poverty pressures), often without

time to develop a solid foundation before beginning

work. For this project, the immediate need for

investment was clear—the partnering arrangement

and supply chain opportunities were only considered

Key partners

• Fauna and FloraInternational

• Flower ValleyConservation Trust

• Fynsa (Pty) (Ltd)

• Marks & Spencer

• Shell Foundation

• Shell International

• Shell South Africa

KEYWORDS: sustainable resource use; sustainable livelihoods; partnership KPIs (key performance indicators)

45

in detail as the project developed. In the absence of

initial targets, partners had to pay greater attention to

communication and governance to keep the project

on track.

The absence of initial targets could be considered a

major constraint to quantifying progress and optimizing

the business/partnering process, but in reality it

facilitated a flexible, ad hoc approach in the early

stages, when the eventual outcomes from applying a

commercial model in a development setting were still

uncertain. As the uncertainties have diminished, key

performance indicators have been developed for use in

the second phase to monitor progress and assess how

effectively the partnership is working.

The creation of Fynsa gave rise to new commercial

opportunities. However, the split also led to significant

tensions between this new commercial entity and

FVCT. In resolving these tensions, the partners learned

a number of lessons:

■ The four- to six-month period between the start of

the negotiations and the transfer of the business

aspects to Fynsa was too short, and appropriate

agreements and management processes were not

in place. Sufficient time to prepare and to develop

trust is necessary before partners move from

negotiation to implementation. The process of

building a successful partnership should not be

rushed or accelerated beyond its natural pace.

■ The people initially brought in to manage Fynsa

had little prior exposure to the project. A

breakdown in the relationship with FVCT led to

Fynsa agreeing to change its management and

board leadership in January 2005. These changes

have revitalized communications and brought

extensive marketing experience and an

entrepreneurial spirit to Fynsa. Successful roll-out is

clearly as much about getting people with the right

approach and style on board as it is about getting

the management structure and plans in place

before launching the partnership.

■ The potential clashes between a public benefit

conservation partner and a commercial partner

used to a more aggressive and competitive

environment were unforeseen. An exercise such as a

SWOT (strengths, weaknesses, opportunities and

threats) analysis of the partners could have

eliminated or reduced this potential and could also

have formed the basis for partnership agreements

detailing the roles and expectations of each partner.

The tensions between FVCT and Fynsa highlight

the difficulty other partners may face in controlling or

influencing some partner interactions. In this case, the

resolution of issues between FVCT and Fynsa was

largely outside the direct control of Shell or the Shell

Foundation.

Conclusions

The Flower Valley project has highlighted the strength

of partnerships in developing and taking forward

innovative approaches to conservation—alone, none

of the partners had the capacity or skills to successfully

deliver the desired conservation and livelihood outcomes.

The project also indicates that the private sector

can provide business skills to help the conservation

community achieve its goals hand in hand with social

and economic development. Although the partnership

is still developing, Fynsa is well positioned to become a

strong player in the marketplace for sustainably

produced goods.

The partnership project has demonstrated the

viability of a business model for resource conservation

and sustainable livelihoods, with the potential for

replication within and beyond South Africa.



PARTNERS: NGO • B&I

LEVEL: regional

LOCATION: Africa


46

The development of a strategic relationship

The partners—Royal Dutch Shell and Living Earth Foundation—

have been working together on a range of sustainable development

issues for the past 16 years and are now developing their partnership

into a ‘strategic institutional relationship’.1


Shell is a global group of energy and petrochemical

companies under the umbrella of the corporate centre

known as Shell International. Living Earth Foundation,

based in the UK, is an international environmental NGO

working in more than 11 countries and specializing in

environmental education and community development.

The relationship began when Living Earth

approached Shell International to discuss a Shell

subcontractor’s statements about the environmental

impact of Shell’s work in Venezuela. Shell’s openness to

dialogue enabled a relationship to develop between

individuals in the organizations, which eventually

evolved into a partnership.

Shell and Living Earth began formally working

together in 1991, when Shell International in London

provided financial support for Living Earth to move an

existing project in Venezuela into a new phase. Shell

International then invited Living Earth to participate in

several internal staff workshops. As a result, Living

Earth built a reputation within Shell as a pragmatic and

honest NGO.

In 1995, Shell was experiencing considerable

difficulties in Nigeria. Living Earth, already working in

Cameroon, provided Shell with its perspective on the

issues and problems. As a result, Living Earth proposed

to Shell to undertake ongoing work in Nigeria. The

subsequent work included community engagement

panels, workshops and capacity building.2

Over the past 16 years, Shell and Living Earth have

extended their collaboration into three continents and

nine countries, including South Africa, Northeast Russia

and Alaska. This global relationship has allowed Living

Earth to magnify its positive impact on communities

and the environment, and has resulted in genuine

business benefits for Shell.

Challenges

Research into partnerships frequently indicates

setbacks and difficulties. In the Shell–Living Earth

relationship, activity and contact have been limited

during some periods. Both partners have identified

problems in the following areas:

Partnership working Historically, the Shell group of businesses has tended to

engage with other organizations on a contractual basis,

rather than through a partnership approach. Effecting a

transition to partnership working requires a shift in

thinking, culture and working practices.

Staff and department changes Changes of staff and departments within Shell have

meant that Living Earth has needed to renegotiate

many aspects of the relationship with new staff

members, including the building of trust and mutual

confidence.

CompetitionShell has actively integrated a number of Living

Earth’s suggestions. While this receptivity clearly

indicates the NGO’s contribution to the relationship,

‘community development’ departments within Shell,

which have a similar remit, have on occasion viewed

Living Earth as competition.

Financial management Shell deals in billions of dollars, rather than

thousands, and pays its bills at long intervals, rather

than monthly. While Shell has difficulty understanding

the need for regular payments, especially when they

are deemed to be ‘small’, Living Earth is reliant on

such payments and consequently has difficulty

managing its cash flow.

Key partners

• Living EarthFoundation

• Royal Dutch Shell

KEYWORDS: institutionalization of NGO consultative partnership

1 The terms ‘institutional’ and ‘institutionalization’ are used here toindicate several distinct but complementary processes:regularization, formal establishment of working principles andpractices, and stability.

2 For more on the Shell–Living Earth partnership work in Nigeria, seeSimon Heap’s book, NGOs Engaging Business: A World of Difference and aDifference to the World, published by INTRAC, Oxford, UK, in 2000.

Nigeria—SustainableLivelihoods programme(Shell PetroleumDevelopment Corporationand Living EarthNigeria Foundation):rattan cane beingprocessed into fishbaskets.

47

Continuity and fund allocationAt times, particular partnership projects have been

proposed and agreed in principle, but financing has

not been available. While the resulting lapses of

continuity have been frustrating for Living Earth, the

difficulty for Shell stems from its need to allocate funds

from within specific budgets. Despite their appreciation

of the need for particular projects, Shell International

and its local businesses have been uncertain which of

them is responsible for fund allocation in some cases.

Organizational trust Few people within Shell have the experience and

understanding of either the concept or the practice of

conducting a strategic relationship with an NGO. Shell

acknowledges that some of its staff have reservations

about Living Earth, finding it difficult to believe that an

NGO can possess an informed or deep understanding

of a large, multi-layered and complex company.

The process of recognizing these problems has

yielded recent changes in structure, focus and direction

for the partnership.

Benefits and advantages

A subtle, multi-faceted and interactive relationship has

emerged between the two partners. For Shell, there is a

good business case for working with Living Earth. The

organization brings an external perspective and

specific expertise to Shell, and its ability to bring

together players from different sectors enables Shell to

better understand and engage with local communities,

organizations and individuals, and to actively address

their concerns.

As Barnaby Briggs, head of the Social Performance

Management Unit, Shell International, says, ‘We are

delighted with the way the partnership is working. The

relationship we have with Living Earth is open, critical and

constructive, and there is no doubt that it is helping us to

achieve our business and social objectives in sensitive

locations around the world.’

For Living Earth, working with Shell is a powerful

way of furthering its charitable objectives. The

relationship also provides ‘leverage’—that is, ‘if they do

it right with Shell’, then the NGO acquires greater

credibility and better positioning in relation to other

companies and organizations. Furthermore, through

working with Shell, Living Earth now knows how to

approach and talk to the private sector, plus it has

become more adept at ‘walking Shell employees through

various processes’.

Roger Hammond, Living Earth Foundation’s

development director, notes that ‘with Shell we are

working with a company that is willing to share risks and

work with us to build solutions in real-life situations. We

are not dealing with PR platitudes but are engaged in

work that neither entity could achieve on its own. This is

what we call partnership.’

Conclusions

As trust has developed in the partnership, both Shell

International and Living Earth have become more

appreciative of their partner’s strengths and

weaknesses and more confident in questioning each

other’s objectives, perspectives and approaches. The

original patterns of working through individual

projects are evolving into an institutionalized

strategic relationship.

The well-established practice whereby Living Earth

provides external perspectives to Shell is likely to bring

benefits at an increasingly high level of decision

making. The following specific consequences can be

envisaged:

■ Shell will adopt an increasingly systemic approach

to sustainable development in all of its work.

■ Living Earth’s systemic approach will support better

risk management.

■ Shell will enjoy cost benefits with more effective

planning and management from the outset.

■ Shell International and Living Earth’s strategic

institutional relationship will serve as a model for

Shell’s local businesses.



PARTNERS: NGO


LOCATION: global

What’s the catch? Many people are stillvery suspicious of NGObusiness partnerships, sofocus on the impact ofwhat you do together.

Ghana—Living Earthfacilitated Shell Ghanato work with a cluster oflocal stakeholders toestablish a viable fishfreezing business.Thishas resulted in positiveenvironmental and socialimpacts.


48

The Carbon Mitigation Initiative

The Carbon Mitigation Initiative—a partnership between BP, the

Ford Motor Company and Princeton University—is seeking

compelling and sustainable solutions to the carbon and climate change

problem through a long-term research programme.

Background

Scientific evidence points toward a future constrained

by the consequences of a relentless increase in

atmospheric CO2 concentrations. Continuing to use

fossil fuels will require implementing new technologies

on an unprecedented scale to capture and store the

majority of the predicted 1,000 billion tons of carbon

emissions this century.

The new technical approaches must not only

address atmospheric carbon and associated climate

impacts, but also be environmentally benign and avoid

prohibitive costs and disruption of energy consumption

patterns. Solutions to this unique challenge must be

delivered at an accelerated pace and in a way that the

public accepts.


Rising to this challenge, BP sought to engage with an

academic institution to undertake long-term research

that could clarify the issues and identify solutions to

the climate change problem. BP was not looking for a

service provider but for a partner that could give it

access to long-term thinking and technology

development, and could think ‘outside the box’. As an

environmentally aware energy company, BP could offer

field and technical experience, access to data, support

for new thinking and an industry perspective on global

policy issues.

In 2000, BP chose Princeton University to establish

a ‘carbon mitigation research institute’, based on the

university’s proposal and its access to key staff and

resources, particularly for CO2 capture and storage

technology, the hydrogen electric economy and earth

system modelling.

Ford Motor Company, with which BP was already

developing a strategic alliance, also joined as a key

partner, increasing financial support and extending

involvement across the supply chain. Ford brought a

useful perspective on transportation issues, along with

its technical knowledge on fuel cells, fuels and

efficiency, and experience in product development.

In October 2000, the three partners formed the

Carbon Mitigation Initiative (CMI), its mission to

develop new approaches to carbon management.

Recognizing the complexity and longevity of the issues,

both industrial partners made a substantial 10-year

commitment, with BP contributing US$15.1 million and

Ford contributing $5 million.

Current work is focused via four groups:

1. The Carbon Capture Group—assessing the

feasibility and potential costs of reducing carbon

emissions from electricity, hydrogen and synfuels

production, and exploring hybrid fossil-renewable

energy schemes.

2. The Carbon Storage Group—evaluating the

effectiveness and leakage potential of

underground storage.

3. The Carbon Science Group—quantifying natural

CO2 sources and sinks, and creating impact models

for global carbon cycle management.

4. The Integration Group—assessing the economic

and environmental impacts of carbon mitigation

strategies, as well as synthesizing and

disseminating CMI research.

Lessons learned and challenges

In adopting a multidisciplinary and multi-sectoral

approach, the CMI opened the door both to technical

and policy solutions and to partnering-related

challenges and opportunities:

Interaction of industrial and academic partnersBusiness and academic institutions are very different

types of organizations, but both have a lot to learn

from each other. By working together, the partners

have been able to facilitate innovation and delivery.

Engaging in ‘big picture’ discussions (see chart) can

build bridges between participants whose fields of

interest do not clearly overlap. Both BP and Ford have

adopted this approach in their carbon mitigation

efforts. Both companies encourage CMI staff and

directors to visit their offices to promote the two-way

flow of information.

Key partners

• BP

• Ford Motor Company

• Princeton University

KEYWORDS: technical research programme; carbon mitigation; CO2 capture and storage

THEME: Climate change

PARTNERS: B&I • RI

LEVEL: global

LOCATION: global

49

Relationship building As for most, if not all, flourishing partnerships, the

successful development of CMI has relied on the growth

of trust and respect between the partners. Developing

trust takes time, and there are few, if any, shortcuts.

As trust builds, an open, transparent and close

working relationship develops, along with the mutual

desire to ensure that each partner benefits.

Playing to the partners’ strengthsLinks between partners are stronger on some topics

than on others. For example, BP and Princeton are

working closely on underground storage, where both

parties have a clear interest. Each partner must play to

its strengths, with the ultimate goal being to maximize

the overall benefits for the partnership, rather than for

any one organization.

Development of capacity to deliver outcomesWhile researchers with long-standing collaborations

(such as in the Carbon Science and Carbon Capture

groups) were able to quickly generate results, work in

new areas delivered new thinking more slowly,

underlining the need for the partners’ commitment to a

long-term partnership.

By the end of the first year, more than 50 staff

members had been added to the CMI roster. This

extraordinary success in recruitment reflects not only

the compelling nature of the challenge, but also the

10-year life of the partnership. The opportunity to

develop solutions over an extended period has helped

attract and retain key academics and researchers.

All CMI partners understand the need to remain

informed on alternative thinking, competing

technologies and innovative research from other

initiatives and organizations. As one mechanism, an

active six-person advisory committee brings external

perspectives to CMI. The initiative also undertakes

scouting activities on relevant topics, which enhances

capacity building for both the staff and the partnership.

Management of the partnershipMicro-management by the industrial partners has been

minimized to ensure that academic freedom,

innovation and a sense of ‘adventure’ can flourish. For

example, CMI’s Carbon Capture Group analyses

scenarios using a variety of energy sources, including

coal, natural gas, biomass and wind power. Rather than

steer the research towards BP- or Ford-related interests,

the industry partners have encouraged the group’s

explorations and have gained a broad perspective on

the future of energy as a result.

The partners have adopted a ‘light-touch’

management style, relying on frequent informal

contact and regular CMI team meetings, supplemented

by annual progress reviews and formal reviews every

three years for contract renewal purposes.

Conclusions

The complex subject matter, the nature of the specific

sector partners and each partner’s way of collaborating

have challenged the partnership. However, the

partners’ common interests and their continuing desire

to work together have contributed to overcoming the

challenges.

Partnerships are hard work—they rarely happen by

accident, and if they do, they tend to have a limited life.

CMI is entering its sixth year and continues to go from

strength to strength.

Successful partnerships can deliver exceptional

results, and CMI has delivered innovative analyses and

concepts that have contributed to industry and

government thinking on solving climate change issues.

The results are beyond what any partner could have

achieved individually, highlighting the strengths of a

well-managed partnership.


carb

on e

mis

sion

s ( b

illio

n to

nnes

/yea

r)

1955 20050

7

14

2055 2105

historicalemissions

currently

projected path

seven ‘wedges’

towardtripling

CO2

avoiddoubling

CO2

flat path

Over the next 50 years,about 200 billion tons ofcarbon emissions willneed to be avoided toprevent a doubling ofatmospheric CO2 andavoid the worst predictedconsequences of climatechange. CMI’s‘stabilization wedges’concept divides thisamount into seven equal‘wedges’ that grow fromzero now to mitigating1 billion tons of carbonemissions per year by2055. CMI researchershave identified 15existing strategies—including renewableenergy, carbon captureand storage, efficiencyimprovements, andnuclear energy—thateach already have thecapacity to reduceemissions by one wedge.The concept has proved asuccessful tool forcommunicating the scaleof the mitigation effortneeded and promotingdiscussion amongstakeholders.

The CMI’s ‘stabilization wedges’ concept


50

The Global Climate and Energy Project

An industry-academia partnership has established the Global

Climate and Energy Project at Stanford University to research

energy technology that addresses climate change.

Background

Reducing greenhouse gas emissions while

simultaneously meeting the world’s growing energy

needs requires innovative and cost-effective

technology. To promote this objective, the Global

Climate and Energy Project (GCEP) between Stanford

University in the USA, ExxonMobil and three other

companies (General Electric, Schlumberger and Toyota)

has been established. GCEP seeks to mobilize the most

creative research and development (R&D) processes in

academia to accelerate the generation of breakthrough

leads for advanced energy technologies with low

greenhouse gas emissions.

GCEP at Stanford University is the largest privately

funded programme of academic research on energy

technology to address climate change. ExxonMobil,

General Electric, Schlumberger and Toyota plan to

contribute US$225 million to the project over 10 or more

years, with ExxonMobil providing up to $100 million.

Stanford University is well suited to generate and

explore innovative leads arising from fundamental

science, and it has the wide range of expertise

required. ExxonMobil recognizes the advantage of

bringing independent, imaginative minds in academia

into the effort, to complement its in-house R&D. In

addition, an important by-product of working with

academia is the ability to build strategic, long-term

capacity. This occurs by refocusing traditional

engineering disciplines to address long-term energy

challenges and training a new generation of highly

skilled students with enthusiasm to contribute to

solutions in the coming decades.

The Global Climate and Energy Project

Begun in 2002, the 10-year Global Climate and Energy

Project aims to accelerate development of

breakthrough leads in commercially viable

technologies that are able to meet global energy

demand while dramatically lowering greenhouse gas

emissions. According to Stanford University’s President

John Hennessy, ‘GCEP is building a scientific foundation

for creative solutions to bear on some of the Earth’s most

daunting challenges.’

In establishing GCEP, all participants agreed on

three principles that would be essential for its success

in an academic setting:

1. Individual research programmes must be of the

highest quality and directed at high-risk, high-

reward opportunities.

2. Full academic freedom is vital for everyone

involved in the project—faculty, students and

others.

3. Results will be published in peer-reviewed

literature and publicized widely.

The partners worked to ensure that these principles

were clearly expressed in the GCEP Agreement and

continue to stress them as the project proceeds.

GCEP’s areas of research include the study of

biomass, wind, solar and other renewable energies;

advanced combustion; production and use of

hydrogen; carbon capture and storage; advanced

transportation; advanced materials; advanced coal; and

power production, distribution and storage. In

addressing these areas, researchers seek technological

leads that may overcome current barriers to large-scale

commercial applications, such as cost, performance,

safety, environmental and regulatory compliance, and

consumer acceptance.

Stanford University is responsible for developing

and managing GCEP research, using a variety of

approaches to stimulate cutting-edge research,

including visiting other institutions around the world

and convening workshops on particular theme areas

(for example advanced transport), to identify

potential research leads and current barriers. Stanford

then solicits step-out, breakthrough research

proposals that are subject to a rigorous peer review

and approval process.

A unique aspect of GCEP is the creation of

academic research at Stanford to evaluate the potential

of the GCEP research portfolio in making a significant

contribution to reducing future greenhouse gas

emissions. This capability will enable research priorities

to be readjusted within GCEP and throughout the

Key partners

• ExxonMobil

• General Electric

• Schlumberger

• Stanford University

• Toyota

KEYWORDS: greenhouse gas emissions; energy technology; research capacity building

51

global research community, allowing the project to

adapt and to focus on the most promising

opportunities.

Progress and outcomes of the partnership

Roughly three years into the project, GCEP has now

awarded nearly 30 research programmes totalling close

to $55 million. At Stanford, the research programmes

involve more than 100 students and post-doctoral

fellows and 37 faculty from 13 departments. Another

13 faculty are engaged from eight other institutions in

Australia, Japan, Europe and the United States.

Current GCEP-funded research efforts include work

in solar energy, biomass, hydrogen production, fuel

cells, advanced combustion, and carbon capture and

storage. In the future, other areas will be assessed and

added to the portfolio. For example, advanced coal and

transportation are now under consideration.

The alliance of scientific researchers and

technology-driven companies supports GCEP studies

at Stanford, as well as collaborative and independent

efforts with other research institutions in the USA and

around the world. Of particular importance is the

involvement of institutions in developing countries

with fast-growing economies, where energy demands

will increase most rapidly in the years ahead.

Scientists and engineers from developing countries

regularly participate in GCEP workshops on the

current state of the art in various technology areas.

For example GCEP hosted a workshop in August 2005

in Beijing on advanced power generation with carbon

capture and storage.

The role of private sector partners involves more

than funding. Long-term experience in research,

development and commercialization of technologies

on a global scale enables companies to contribute

technical expertise and practical insight into the

barriers that may limit the commercial success of new

technologies. According to Professor Lynn Orr, the

GCEP project director at Stanford, ‘industry perspectives

can illuminate the university research process in very

important ways: posing questions, challenging

researchers and helping the research groups understand

current barriers to technology implementation.’

Lessons learned

After three years, it remains a challenge to generate

truly innovative research proposals with the potential

for game-changing outcomes to energy technology on

a global scale. In part, this occurs because the issues

addressed have been under consideration for many

years by many smart scientists—so potentially

promising leads have already been explored in great

depth. In addition, academic scientists typically

compete for funding from sources with far more

structured mandates—so they have become

accustomed to framing proposals that are more

conventional, incremental and likely to succeed. It

requires significant ongoing effort to communicate

GCEP’s mandate to seek out high-quality, high-risk

research with the potential for a major breakthrough.

Conclusions

A diverse set of research programmes are now under

way, with more in the pipeline as the project evolves to

a steady state level of activity. GCEP has galvanized a

renewed interest by faculty and students in the role of

advanced energy technologies to provide solutions to

global challenges.

GCEP’s results are available to any interested party.

In particular, ExxonMobil and the other GCEP partners

will harvest promising research leads and, through

their efforts and in collaboration with others, seek to

turn leads into commercial technologies that can be

deployed on a global scale.

For more information on GCEP activities see

http://gcep.stanford.edu



PARTNERS: B&I • RI

LEVEL: global

LOCATION: global

A GCEP graduate-student researcherinvestigates more efficientcombustion engines inthe Advanced EnergySystems Laboratory atStanford University.

KEYWORDS: risk-based evaluation tool; research and development; intellectual property management


52

The CO2 Capture Project

An international group of energy companies, in conjunction with

government agencies and in cooperation with educational institutions

and NGOs, are pursuing technological breakthroughs for the capture

and storage of CO2.

Background

As the world demand for energy increases, with fossil

fuels accounting for most of the energy generation, CO2

concentrations in the world’s atmosphere are expected

to reach twice the pre-industrial level by the end of this

century. A number of adverse effects, including global

climate changes, could result. The potential risks

associated with taking no action—coupled with the

length of time required to stabilize CO2 concentrations

in the atmosphere—argue for taking immediate action.

No single technology is capable of providing a

solution. Instead, a mix of approaches, including using

alternative energy and more efficiently using conventional

fuels, will be required. Another approach that is part of

the solution is capturing CO2 from the combustion of

fossil fuels and storing the captured CO2 underground.

To look further at CO2 capture and storage, eight

oil companies and three government agencies set up

the CO2 Capture Project (CCP – Phase I) in 2000.

The CO2 Capture Project

The partnership is taking a multi-phase approach to:

■ develop technology that will reduce the costs and

improve efficiencies of CO2 capture through the use

of advanced technologies;

■ demonstrate storage is safe and secure; and

■ communicate the project findings for use by policy

makers to support the implementation of CO2


The CCP is providing answers to questions

regarding well integrity and storage in saline aquifers,

and developing a certification framework for storage

applications.

An Executive Board, composed of representatives

of the participating companies, directs the CCP. Five

technical project teams, working with external

technical experts, oversee five areas of development:

1. Capture: evaluating and advancing specific capture

technologies.

2. Storage: verifying the feasibility of underground

storage, and developing improved monitoring and

verification methods.

3. Economics: understanding and comparing the

costs and benefits of various approaches to capture

and storage.

4. Communications: building awareness of the

technical developments among policy makers and

interested stakeholders.

5. Policy: assessing the impact of proposed

government policies and regulations on CO2


An independent Technical Advisory Board of private

and public sector representatives unassociated with the

participating companies objectively evaluates the research

and guides the project teams’ developmental work.

The CCP works with governments, industry, academic

institutions and environmental interest groups, and

subjects the products of its research to vigorous peer

review. The programme has now entered Phase II.

Key partners

Companies:

• BP

• BR Petrobras **

• Chevron

• ConocoPhillips**

• EnCana *

• Eni

• Norsk Hydro

• Shell

• Statoil *

• Suncor Energy

Government agencies:

• European Commission

• The Research Councilof Norway (Norgesforskningsråd)

• UK DTI (Departmentof Trade and Industry)

• U.S. Department of Energy

* Phase I only

** Phase II only

CCPExecutive Board

TechnicalAdvisory

Board

AssociateParticipants

(Phase II only)

Technology Providers

Econ

omic

s Tea

m

Capt

ure

Team

Com

mun

icat

ions

Team

Polic

y Te

am

Stor

age,

Mon

itorin

g an

dVe

rific

atio

n (S

MV)

Team

Progress

In Phase I the CCP developed a risk-based tool for

evaluating the most appropriate storage sites, and also

successfully integrated research and development of

storage, monitoring and verification with the concerns

of NGOs and policy makers. More than 200 capture

technologies were evaluated for potential application

to full-scale development. Phase I was completed in

2003 with the broad publication of its results, including

a two-volume compilation of findings.

CCP2 Programme Structure

53

Phase II (2004–08) is focused on further

development of cost-effective and versatile capture

and storage technologies, with the objective of moving

to operational demonstration in Phase III in 2009.

The most promising technologies studied have

shown large potential for cost-efficient capture of CO2

emissions and are adaptable for use in many of the

world’s major emission sources. Pre-combustion capture

is suitable for all fossil fuels, and also may produce

enough hydrogen to open the way for a future

hydrogen fuel-based economy.

Lessons learned

Positive experiences in Phase I to date reveal some

lessons for a large international partnership project:

1. A robust project management process and

reporting system ensure that work is aligned with

project objectives, information supports the proper

allocation of financial and other resources, and the

work of external contractors is monitored and

directed appropriately. The use of teams focused

on particular areas of responsibility is an effective

way of monitoring contract work and providing

timely direction.

2. Similarly, an effective technology review process

ensures rigorous review at specific points,

confirming that development is in line with project

objectives and is focused on the most promising

technologies.

3. An unbiased technological screening process

provides NGOs with assurance that the technologies

being pursued are the best available and are

appropriate to the companies involved, and that the

choice of technologies rests on a comprehensive and

objective evaluation. The challenge of demonstrating

that a better technology does not exist is analogous

to the difficulty of proving a negative. Nevertheless,

the presence of a Technical Advisory Board is useful

to show a reasonable, scientific and economic

rationale for the choice of technologies.

4. Communication skills are essential for team leaders,

so that the CCP Executive Board receives the type

and amount of information needed for timely and

appropriate decisions. This is especially true for

projects that involve advanced technology, when

project review meetings could easily concentrate

on discussing technical aspects, rather than on

identifying the key issues requiring a decision.

5. Government participation can help with financial

support and with a project’s credibility. However,

participants must anticipate the government’s

requirements for reports and readily provide the

information using prescribed formats.

6. An effective intellectual property management

programme can address participants’ concerns about

the creation and ownership of intellectual property.

7. Sharing findings through stakeholder meetings

assists in clarifying public concerns about CO2

storage.

8. Clear communication with external groups helps

establish the relevance of technical approaches

and choices.

Lessons learned include the need for the following:

1. More detailed and standardized objectives in

contracts with external providers.

2. Cost considerations at the earliest stages of

development projects to identify promising

technologies as early as possible.

Conclusion

The work of the CCP demonstrates that public-private

partnerships result in breakthroughs in technology

development quickly through involvement of

interested parties from all perspectives: technology

users, policy makers and educational institutions.

For more information on the CO2 Capture Project see

www.co2captureproject.org



PARTNERS: GOV • IGO • O&G • RI

LEVEL: global

LOCATION: global

cost

redu

ctio

n (%

)

oxyfuel postcombustion

precombustion

0

10

20

30

40

50

60

29%

38%

23%

55%

14%

60%

maximum reduction

minimum reduction

The CO2 CaptureProject (CCP) has underdevelopment newtechnologies that couldreduce the cost of CO2capture (from US$60–80to US$20–30 per ton).


54

The Global Gas Flaring Reduction Partnership

Launched at the 2002 World Summit on Sustainable Development,

the Global Gas Flaring Reduction Partnership supports the efforts of

the petroleum sector to progressively reduce flaring and venting of

natural gas associated with crude oil production.

Background

When crude oil is extracted from the earth, natural gas

comes to the surface as well. The gas is typically used

to meet power and other operational requirements,

with excess gas processed and sold if gas infrastructure

and markets are nearby. In areas of the world lacking

infrastructure and markets, the excess gas is usually

flared or sometimes vented. The World Bank estimates

that the annual volume of flared and vented natural

gas is more than 150 billion cubic metres, or

approximately the combined annual gas consumption

of Germany and France. Greenhouse gas emissions

from flaring are also about 13 per cent of committed

emission reductions by developed countries under the

Kyoto Protocol.

For the past 20 years, global flaring levels have

remained virtually constant despite successful efforts

by individual governments and companies to use the

associated gas and thereby reduce flaring. The overall

effect of these efforts has been limited because of

(1) the increase in global oil production and associated

gas production and (2) the lack of regulatory and

contractual structures, and the constraints on gas

utilization, infrastructure and market development.

The Global Gas Flaring Reduction Partnership

(GGFR1) is a forum of governments of oil-producing

countries, state-owned companies and international

oil companies. The partnership aims to support

national efforts to use the associated gas and to

reduce flaring and venting. The GGFR steering

committee approved a three-year work programme

beginning in January 2003 and coordinated by a small

team of World Bank staff and industry secondees

based in Washington, DC. The work programme

focuses on four areas of activity:

1. commercialization of associated gas;

2. regulations for associated gas;

3. a voluntary standard for associated gas flaring and

venting reduction; and

4. carbon credits.

The GGFR programme contributes to poverty

reduction and quality of life improvements by

developing concepts for how local communities close

to the flaring sites can use natural gas and liquefied

petroleum gas (LPG) that may otherwise be flared. The

programme has evaluated two opportunities for small-

scale gas utilization in Ecuador and Chad.

Benefits

A key attribute of the partnership is the diversity of

partners, each bringing different experience and

expertise. While all the partners recognize the need to

address the flaring issue, they express several other

reasons for joining the initiative.

Company members note that GGFR is better able to

engage with governments than industry associations,

as it is coordinated by the World Bank. Being ‘at the

table’ brings broader recognition, as well greater

influence on the partnership’s direction and output. For

instance, during the development of the GGFR

voluntary flaring and venting standard, companies

actively provided their input to ensure that the

standard was both commercially realistic and aligned

with their company policies and approaches.

For some government partners, GGFR has

supported the development of new policies on

natural gas and related fiscal policies, while in other

cases, it has helped countries achieve their flaring

reduction objectives more rapidly. The government

partners recognize that the World Bank’s position as a

‘neutral broker’ enables it to bring the right

stakeholders together. GGFR also provides a forum for

governments to share regulatory approaches and

learn from each other.

Over the three years of the partnership, the focus

has shifted to putting the global programmes—such

as the voluntary flaring and venting standard—into

practice in national initiatives and demonstration

projects. For example, in Equatorial Guinea, GGFR has

helped facilitate better collaboration between

Key partners

Governments:

• Angola

• Cameroon

• Canada

• Chad

• Ecuador

• Equatorial Guinea

• Indonesia

• Kazakhstan

• Khanty-Mansiysk

• Nigeria

• Norway

• United States

Companies:

• BP

• Chevron

• Eni

• ExxonMobil

• Marathon

• Norsk Hydro

• Shell

• Sonatrach

• Statoil

• Total

Internationalorganizations:

• World Bank

KEYWORDS: gas flaring and venting reduction; voluntary industry standard

55

operators, the national oil company and the regulator.

GGFR is also cooperating with several flare elimination

demonstration projects in Angola, Algeria and

Nigeria, to evaluate their potential to earn

greenhouse gas credits through the Clean

Development Mechanism (CDM).

Lessons learned

Effecting change in flaring and venting practices

requires time, effort and persistence. GGFR has been

most successful where there is country buy-in, high-

level support and an effective local partnership

between government and industry, as well as

ownership and leadership within the participating

organizations. The process takes sustained effort over

many years.

As expected, the partnership has faced a number of

challenges, which have raised some key issues and led

to some lessons being learned:

■ As the responsibility for gas flaring regulation may

be fragmented or may overlap several ministries, it

is important to identify the responsible counter-

party within the host government.

■ Government agencies need to play a leadership

role in promoting and sustaining in-country gas

utilization, commercialization and flare reduction

initiatives.

■ GGFR is reliant on the willingness of operators to

cooperate and share gas volumes and technical

information that may be commercially or

politically sensitive. Care must be exercised in how

the data is aggregated and used. Often,

confidentiality agreements require all partners in a

joint venture to give their approval before data can

be released externally.

■ To focus its limited resources efficiently, GGFR could

do more to clearly define success and to assess the

likelihood of success in each of its activities.

■ GGFR could be more selective and prioritize which

countries and projects have the greatest chance of

achieving significant flare reductions.

■ Some suggest that better engagement of

environmental NGOs could bring more

transparency and credibility to the partnership.

Conclusions

GGFR has been successful in raising the profile of gas

flaring and venting as an issue and has organized two

major flaring conferences.

In July 2005, the G8 joint statement at Gleneagles,

Scotland called for GGFR to be extended beyond 2006.

There is broad acceptance of the flaring and venting

standard and the collaborative approach it encourages.

In certain circumstances, the CDM Executive Board may

consider flare elimination projects acceptable for

carbon credits.

The partners recognize the role of the GGFR

initiative in reducing gas flaring and venting. The GGFR

partnership, and the voluntary standard in particular,

have encouraged better cooperation among a broader

set of stakeholders in addressing the issue. The

partners also recognize that there is more work to be

done and agreed in principle in November 2005 to

extend the GGFR partnership for three more years

beyond 2006.

For more information on on the GGFR initiative see the

GGFR website: www.worldbank.org/ggfr



PARTNERS: GOV • O&G

LEVEL: global

LOCATION: global

Land-based flare withproduction installationnearby


56

The partnership for fuels and vehicles research

The European Council for Automotive R&D, the European

Commission’s Joint Research Centre and CONCAWE formed a

partnership in 2000 to carry out joint studies on automotive fuels

and vehicles.

Background

In 2000, the European Commission’s Joint Research

Centre (JRC), which carries out extensive scientific and

technical research in support of EU policies, was

looking at developing its activities in the field of

automotive fuels and powertrains. JRC approached the

European Council for Automotive R&D (EUCAR) and

CONCAWE (the oil companies’ European association for

environment, health and safety in refining and

distribution), and in that year the three organizations

signed a Memorandum of Understanding for carrying

out joint studies on topics of common interest.

An association of European vehicle manufacturers,

EUCAR carries out pre-competitive research on such

topics as safety, future powertrains and advanced

vehicles. EUCAR members represent the bulk of

European automotive industry and include BMW,

DaimlerChrysler, Fiat, Opel, Porsche, PSA Peugeöt-

Citroën, Renault, Volkswagen and Volvo.

CONCAWE’s 23 full members, which own more than

90 per cent of the EU25 oil refining capacity, are BP,

CEPSA, Chevron, ConocoPhillips, Dow, Eni, ExxonMobil,

Hansen & Rosenthal, Hellenic Petroleum, Kuwait

Petroleum International, Mazeikiu Nafta, MOL, Neste

Oil, Petrogal, Nynas, OMV, PKN Orlen, Preem, Repsol,

SARAS, Shell, Statoil and Total.

The main purpose of the EUCAR/JRC/CONCAWE

partnership is to generate scientific and technical

information on the development of road vehicles and

associated subjects. The motor manufacturers and the

fuel providers can then develop consensus on the

soundness of the technology, while the regulating

authorities can use the information to support EU

decisions and regulations.

The partnership is managed by a Supervisory Board

comprising two delegates from each of the three

partners. The Board meets twice a year, or more often

as the need arises.

From CONCAWE’s perspective, the partnership is

crucial to establish:

■ a solid and shared technical basis to support future

EU regulations on fuels and vehicles;

■ a constructive working relationship between the oil

industry and the automotive industry; and

■ an effective working relationship between industry

and JRC.

In the words of Alain Heilbrunn, CONCAWE’s

Secretary General, ‘the ongoing debate on alternative

fuels is dominated by emotion and ill-founded assertions.

The only correct way to proceed is through collaborative,

in-depth technical work to bring sound facts and figures to

the table.’

The ‘Well-to-Wheels’ study

At the end of 2000, the partners launched the first

cooperative study, titled the ‘Well-to-Wheels Analysis of

Future Automotive Fuels and Powertrains in the Joint

European Context’—in short, the ‘JEC WTW study’. The

study objective was to develop a consensual view of

the relative merits of a large number of alternative

fuels and powertrain pathways for 2010 and beyond.

The primary focus was on well-to-wheel energy use

and greenhouse gas emissions assessment.

For the study, EUCAR and CONCAWE brought their

respective knowledge of the automotive and oil

industries to bear. JRC provided essential input on

issues of biomass, having direct access to the most

appropriate European Commission services such as the

Directorate-General (DG) for Agriculture and Rural

Development. JRC also facilitated contacts with other

Key partners

• CONCAWE (oilcompanies’ Europeanassociation forenvironment, healthand safety in refiningand distribution)

• EUCAR (EuropeanCouncil forAutomotive R&D)

• JRC (Joint ResearchCentre, EuropeanCommission)

KEYWORDS: air quality; research and technology development; EU policy support


PARTNERS: IGO • O&G • B&I

LEVEL: regional

LOCATION: EU

57

‘customer’ Commission services such as the DG

Transport and Energy and the Environment DG.

For the specific purpose of the JEC WTW study, the

partnership was extended with the use of two

consultants. A coordination group arranged for

external experts to review the study results.

Progress and study impacts

Although the partners decided at the end of 2000 to

go ahead with the project, the work was delayed for

more than a year, mainly because of a major

reorganization at JRC, including the transfer of some

activities to a new site and a change of JRC personnel

assigned to the partnership. Also, by the end of 2001,

the European Commission’s interest in alternative

fuels had heightened and a sound WTW analysis was

clearly needed.

The first version of the study report was published in

December 2003. The study successfully anticipated the

European governments’ and regulators’ increased focus

on alternative road fuels and vehicles to address issues

of CO2 emissions and long-term security of supply. The

study results were used as a basis for discussions and

policy recommendations in many forums, including

meetings of the European Commission’s Alternative

Fuels Contact Group during 2004.

The timeliness and relevance of the first WTW

report, as well as the process whereby the study was

carried out, increased the partners’ recognition of each

other’s issues and problems and strengthened their

working relationships. The report also helped

CONCAWE develop improved relations with other

Commission services.

A report update was released at the end of 2005, as

part of the process of keeping the study evergreen.

Other partnership projects

Identifying other projects of common interest in

anticipation of EU needs proved to be a more

challenging task. A second project was eventually

agreed on in early 2004 to measure the evaporative

emissions of vehicles with different fuels, in support of

the European Commission’s review of the EU fuels

directive on gasoline vapour pressure and particularly

ethanol blending. The project, mostly consisting of

vehicle testing by JRC in its new facilities, with the

European Automobile Manufacturers Association

(ACEA) supplying the vehicles and CONCAWE the fuels,

commenced mid-2004 and is still ongoing; the final

report is due in 2006.

Further projects will be identified in accordance

with key EU issues and partners’ interests, and with the

particular capabilities of the partnership.

Conclusions and lessons learned

A successful partnership requires commitment from all

partners, specific objectives and deliverables supported

by a well-structured organization, and a clear

distribution of tasks, as well as allocation of sufficient

technical expertise and financial resources to achieve

and deliver the results on schedule.

Commitment can only be obtained when the

objectives are relevant to all partners. This cooperative

action was slow to start, partly because this was not

quite the case at the beginning. The relationship is now

firmly established and has proven capable of delivering

high-quality results. To quote Neville Thompson, an

official member of the Supervisory Board, ‘the small

acorn has taken time to mature but is now becoming a

solid oak tree’.

Finally, this type of partnership provides an

opportunity to enhance the credibility and the impact

of the studies, directly by incorporating the views and

knowledge of more parties and indirectly by

improving the perception of the results as cooperative

and consensual.

For more information see www.concawe.org



58

The Oro Community DevelopmentTrust in Coastal Nigeria

Nexen, in partnership with Pro-Natura International (Nigeria), is

working with five Local Government Areas in the Oron region of

coastal Nigeria towards replication of a sustainable model of

participatory community development.

Background

Nigeria has significant oil revenues and significant

social problems. Distribution of oil revenues has been

at the heart of numerous community conflicts,

especially in the Niger Delta. The traditional approach

of petroleum companies designating specific ‘host

communities’ as recipients of community development

assistance has often exacerbated these conflicts. A key

challenge for petroleum companies doing business in

the Niger Delta region is to find a more equitable and

transparent approach to community support that will

foster sustainable improvements in the well-being of

communities in this region.

In 2000, Nexen was approached by a prominent

NGO, Pro-Natura International (Nigeria), to support a

feasibility study on a community development

initiative in Bayelsa State, adjacent to one of the oil

company’s offshore drilling prospects. In partnership

with other petroleum operators, Pro-Natura had

achieved notable success in Akassa, Nigeria, where

community-owned and managed institutions (for

example vocational training centre, medical laboratory,

ferry, micro-credit scheme) have been sustained for

more than 10 years. The feasibility study demonstrated

the potential for replicating the Akassa programme in

several communities across the Niger Delta region.

The Oro Community Development Trust

In early 2004, Nexen, as the operating partner for an

indigenous Nigerian company, Oriental Energy,

commenced sponsorship of a new Pro-Natura project,

the Oro Community Development Trust (OCODET), in

Akwa Ibom State, adjacent to an offshore exploration

block. The Trust receives and evaluates project proposals

and funds sustainable community development projects

aimed at improving the circumstances of disadvantaged

people in particular and the local community in general.

The Oron region has quickly adapted the Akassa

model to fit its particular cultural circumstances. A

Board of Trustees, transparent governance system and

bank account have been established and are

functioning, though are facing constraints in their

operation. Nexen has provided start-up funding for the

Trust and for its first ‘confidence-building’ project—a

30-passenger water ferry from Oron to Calabar across

the Cross River delta.

To date, the ferry has been a successful commercial

venture. It has provided safe passage to more than

7,500 people, and the community is examining the

feasibility of expanding the operation to include a

charter service. The Trust is also using the seed funding

and ferry revenue to support other capacity-building

initiatives such as institutional development workshops

and agricultural expansion support programmes.

Lessons learned about participatorycommunity development

A neutral and trusted third party such as Pro-Natura is an

essential intermediary between the petroleum operator

and the community. Anger and resentment among the

Niger Delta communities against the industry and the

government have often reached the boiling point and

have led at best to confrontation and mischief and at

worst to outright violence. An arm’s-length relationship

is the best approach, at least initially, for the long

journey towards trust-based working relationships.

In its years as the catalyst and neutral broker for

participatory community development programmes in

the Niger Delta region, Pro-Natura has learned that

effectively instilling community ownership requires the

following:

■ participatory needs analysis, planning, decision

making and programme implementation;

■ inclusion of all community members and all groups

within the community—in particular, women and

youth—with strong efforts to engage the ‘poorest

of the poor’;

■ capacity building of individuals and institutions

within the community; and

■ building of trust and confidence by starting with

modest projects, with some needed and properly

constructed infrastructure to supplement the

capacity building.

Key partners

• Nexen (on behalf ofOriental Energy)

• Oro CommunityDevelopment Trust

• Pro-NaturaInternational (Nigeria)

KEYWORDS: NGO intermediary; participatory model; capacity building; transferable model

59

Villagers trained through participating in previous

programmes can serve as teachers in ‘living

universities’, both for replicating programmes and for

educating others in government, industry and other

sectors.

Lessons learned about partnership

The partnership has benefited from many of the

lessons, some of them hard and painful, that

Pro-Natura has learned over at least the past decade of

nurturing the participatory community development

model in the Niger Delta. The most significant ‘take-

aways’ include the following:

1. The participatory community development model

is far superior to the host community adoption

approach, not only for cost-effectiveness but also

for superiority of tangible and sustainable

community outcomes, as well as minimization of

business interruptions. In the words of Richard

Owens, Nexen’s managing director in Nigeria, ‘self-

sustaining enterprises lead to peaceful communities

and no disruption to our operations. That’s a

valuable commodity.’

2. An open and transparent governance process for

partnerships of this nature is vital for long-term

success. All participants, especially the receiving

communities, need to be able to clearly see that

not only are their most pressing needs being

addressed, but also that the available funds are

being expended in accordance with technically

sound project proposals. Corporate, community-

based organizations such as those created for the

Akassa and the Oron communities seem to be the

most effective model.

3. A broad base of industry and other support (for

example government, EU, World Bank, various

charitable foundations) is needed for community

programmes of this nature. Multiple partners help

ensure financial and institutional support over the

long term and broaden trust relationships. Also,

with more partners, particularly if government is

included, the oil industry can more easily leave the

centre stage of community development and

concentrate on what it does best, producing oil,

and when the time (inevitably) comes, exit the

stage completely.

The OCODET project offered additional lessons:

■ Although some oil companies operate under severe

time constrains, ample time must be allocated to

community participation and awareness

programmes to overcome suspicion and mistrust.

■ To protect their reputation for effective facilitation,

partnering NGOs must be certain that an enabling

environment, notably adequate time and sustained

funding, exists for their work.

■ Volunteerism is a hardship in poor communities

and can result in disproportionate and insufficient

participation by ‘elites’ and those living outside the

community. Paid key positions in community

institutions are critical.

■ Managing the expectations of community

members is a continuing constraint.

■ Bureaucratic procedures of the government, other

institutions and industry can create excessive

delays, with lasting and widespread impact.

Conclusions

The partnership with Pro-Natura has provided Nexen

with excellent opportunities to test its capabilities to

put its corporate social responsibility principles into

practice in a conflict-torn area of West Africa.

By all accounts, this modest experiment has been a

success so far, giving Nexen and Pro-Natura

encouragement to seek other opportunities to apply

the ‘participatory community development’ model

elsewhere.


THEME: Community development

PARTNERS: NGO • O&G • COM

LEVEL: local

LOCATION: Africa

Oron to Calabar ferrydedication ceremonies


60

Vocational training and sustainable livelihoods for women in Pakistan

BHP Billiton, the Canadian International Development Agency, the

Child Development Organization and the Women Skills Development

Organization have facilitated a process for promoting women’s

empowerment through income generation and socio-economic

development in southern Pakistan since 2001; the partnership work

has benefited the wider community.

Background

Income-earning opportunities are few and far

between for the poor of Dadu district in southern

Pakistan. Agriculture is the main source of income, but

unreliable rainfall, particularly during the drought of

the past years, and an inadequate irrigation system

mean that most people are unable to survive on

agriculture alone. Most families have come to rely on

men migrating for seasonal labour work in towns

nearby or cities further afield.

Women often seek additional income through

selling handicrafts or rope made from local materials,

but lack proper linkages to market these products. The

severe economic pressures on families are a major

constraint to improving their health and sending their

children to school.

Through its community development

programme, BHP Billiton has worked closely with its

partners and local communities in contributing to

sustainable development in the district of Dadu. The

programme aims to empower local people through

social mobilization and institution building. It

provides access to the basic facilities of life, and

targets specific problems in the four areas of health,

education, livelihood support and provision of basic

infrastructure.

The ‘Sartiyoon Silai Karhai Markaz’Vocational Training Centre and theSustainable Livelihoods for the Women ofJohi Project

In 2000, BHP Billiton established a relationship with a

small local NGO, the Child Development Organization

(CDO), as an implementing partner for its projects in

the Dadu district. In 2001, the partnership set up the

‘Sartiyoon Silai Karhai Markaz’ Vocational Training

Centre in the town of Johi, to encourage women to

learn such skills as embroidery, sewing and tailoring for

income generation.

A participatory review of the vocational training

centre in 2003 identified that some of the women

attending the courses had the potential to take their

income-generating activities to a higher level, given

the appropriate training and support. To broaden

partnership participation in the initiative and increase

international stakeholder engagement in the area, BHP

Billiton signed a partnership agreement with the

Canadian international Development Agency’s (CIDA)

Program for the Advancement of Gender Equity. In

2004, the partners initiated the Sustainable Livelihoods

for the Women of Johi Project. The objectives of the

project are to:

■ enable women to earn an independent income;

■ improve the standard of living for women’s families;

■ improve the status of women within their

households and the wider society; and

■ enhance the economic and social well-being of the

community.

Key partners

• BHP Billiton

• Canadian InternationalDevelopment Agency(CIDA)

• Child DevelopmentOrganization (CDO)

• Women SkillsDevelopmentOrganization(WSDO)

KEYWORDS: participatory model; women’s empowerment; vocational training

The Sustainable Livelihoods for theWomen of Johi Project has broughtopportunities for greatly improvedstandards of living, and economic andsocial well-being of the community.

61


Women have expanded their income-generating

activities at the vocational training centre. So far,

around 270 women have attended the centre to

upgrade their sewing and tailoring skills, enabling

them to make clothes either for their families’ use or

for sale.

The progress and impact of the centre mobilized a

group of women in Dadu who wanted to take up the

struggle to change the quality of women’s lives. They

formed the Women Skills Development Organization

(WSDO), an independent NGO with an all-women

governing body, which took responsibility for

management and policy making. In the process, a fresh

and wholly independent, community-owned identity

for the ‘Sustainable Livelihoods’ project was created.

Through the ‘Sustainable Livelihoods’ project,

women running businesses, or interested in starting

businesses, can receive business training, apply for

micro-credit and link up with handicraft exhibitions to

sell their products. So far, 200 women have received

training through the project, with 30 selected to

receive intensive enterprise development support as

part of an ongoing pilot project. Groups of women,

families and individual women have set up small-scale

enterprises after the training. For instance, a number of

women have opened shops selling clothes and

cosmetics in their villages.

Challenges have been thrown up by the partnership

projects, but equally strong learnings shared. It is clear

that to attain maximum value from development work,

the corporate sector and civil society need to work hand

in hand. Working together has been the most significant

challenge for all four partners.

In terms of lessons learned, from the outset

partners need to:

■ understand each other’s values, objectives,

strengths and weaknesses, so that they can build

on success and, despite their diversity, work

towards a common purpose;

■ maintain constant dialogue, not just with each

other but with key stakeholders—specifically local

communities, government agencies and other

development organizations; and

■ fully comprehend their immediate roles and

responsibilities in creating a conducive working

environment for the achievement of sustainable

community development.

The role of NGOs is integral in participatory

community development, as they can act as a mediator

between the local community and the corporate sector.

Finally, a key lesson for BHP Billiton is that it

cannot fulfil all the expectations and requirements of

the local communities where it operates. Therefore, it

is important to work closely with donor organizations

in assisting them to play their part in development of

the area.

Conclusions

The livelihood projects resulting from the BHP Billiton,

CDO, CIDA and WSDO partnerships have improved

access to livelihood opportunities for local households,

and to income-generating activities for women in

particular.

Given the prevailing cultural norms that limit

women’s role to the domestic sphere, it was a

significant challenge to encourage women to expand

their earning capacities by attending the training

programmes on offer, and even more of a challenge to

create an all-women NGO. That both initiatives have

succeeded without creating social conflict is extremely

encouraging and has promising implications for the

future. Awareness of women’s rights and capabilities is

increasing among the local communities as they

experience the projects’ positive effects.

For BHP Billiton, the partnership work has helped

establish the tenets for a stronger local economy,

resulting in a better educated, better equipped

workforce.



PARTNERS: GOV • NGO



So far, the TrainingCentre at Johi hasprovided training to 270women in thedevelopment of a varietyof skills including sewingand handicrafts.TheSustainable Livelihoodsproject has providedbusiness-related trainingand support to 200women, already leadingto the establishment of20 small-scaleenterprises.


62

The Bhit Rural Support Projectin Pakistan

Eni Pakistan and Thardeep Rural Development Programme have

been working together since 2002 on a project to improve the quality

of life of the communities in and near Eni’s concession areas in the

Dadu district of Pakistan.

Background

Eni Pakistan has been carrying out community

development activities in the Bhit Development and

Production (D&P) lease area for several years. In 2002,

to pursue a more holistic approach to community

development, Eni Pakistan entered into a partnership

with a local NGO—Thardeep Rural Development

Programme (TRDP)—to form the Bhit Rural Support

Project (BRSP) in the Dadu district.

TRDP emerged as an independent NGO in 1998

when Save the Children UK wound up its operations in

the Thar Desert. The NGO, which has 400 employees,

has internationally recognized expertise in social

mobilization and grass-roots community development

in arid areas. TRDP’s headquarters are in Mithi, and it

has 40 offices around Sindh province, with an office for

BRSP in Jhangara, the closest town to Eni Pakistan’s

Bhit gas field.

The Bhit Rural Support Project (BRSP)

The underlying philosophy of BRSP is to socially

mobilize local communities and build capacity in

specific areas. Social mobilization is a carefully planned

and controlled effort to mobilize a community, or

groups within a community, to solve their specific

problems. In this project, Eni Pakistan and TRDP are

using social mobilization in combination with

sustainable community development for the first time.

A TRDP team of specialists, recruited from the local

communities and trained in social mobilization,

constitutes the BRSP staff. The team organizes

communities by encouraging them to establish village

development organizations (VDOs). Once the VDOs are

formed, their capacity is built up through coaching and

training. A network of 313 VDOs has already been

developed, with 121 of the VDOs led by women which,

in a feudal and male-dominated culture, is a notable

achievement. Another critical function of the VDOs is

capital formation; so far, all VDOs have been active in

this area as well.

One of the key objectives of Eni Pakistan was to

attract other mainstream national and international

donors actively working on poverty alleviation in

Pakistan. As the social arm of Eni Pakistan, TRDP has been

successful in developing partnerships with Save the

Children, the United Nations Development Programme

(UNDP), the Pakistan Poverty Alleviation Fund, the

World Health Organization (WHO) and the World Food

Programme. All these donors have contributed

significantly to projects which directly benefit the local

population. This work has become possible only

because the communities are now organized, trained

and ready to improve their living conditions.

The BRSP initiatives

BRSP has mostly invested in health, education, water

resources development and income generation, which

includes micro-credit. It now also incorporates small-

scale communication infrastructure in its programmes.

HealthOwing to the high rates of maternal and infant

mortality as documented in a 1997 survey by the Aga

Khan University Hospital, the partners decided to

establish the Mother & Child Health Center (MCH

Center) in Jhangara. Equipped with a pathology

laboratory and an ambulance, the centre has a

professional team of health staff including a female

doctor, two trained midwives and two laboratory

technicians.

In 2003–04, BRSP constructed an eight-room

building for the MCH Center at a cost of US$50,000, on

land donated by the Jhangara community. The MCH

Center has provided a range of health services to more

than 26,000 people since it opened. Around 95 mobile

clinics have also visited the more remote villages,

benefiting an additional 3,000 patients.

In a separate initiative, three outreach community

health centres (CHCs) are functioning in Kai, Naing and

Tando Rahim Khan villages, benefiting more than

10,000 patients in the 2002–04 period. A fourth CHC

building has been constructed at Bhit and should be

operational soon.

Key partners

• Eni Pakistan

• Thardeep RuralDevelopmentProgramme (TRDP)

• Network of villagedevelopmentorganizations

KEYWORDS: income generation; capacity building; health; education; water resources

63

The communities have actively contributed to

constructing the MCH Center and the CHCs by

donating plots and bearing the labour and in some

cases the material costs of these projects.

In addition to the infrastructure development,

$38,000 is spent annually to meet the recurrent costs of

these health facilities which, since 2002, have served

94,000 people.

EducationBRSP operates eight primary schools, one computer

training centre in Jhangara, one boat-building school

for Manchar Lake residents and two female vocational

schools in the villages of Chhinni and Tando Rahim

Khan. Eni Pakistan has spent $16,000 on infrastructure

development of these projects and has also provided

furniture, equipment and educational materials.

Eni Pakistan spends $15,000 annually on running

these schools.

Water resources developmentThe eight-year dry spell in the Bhit and Bhadra

mountains and valleys compelled Eni Pakistan to spend

substantially on developing water resources for the

local communities during 2003–04. Three drinking-

water supply schemes, which included tube wells, a

water supply network and pumping machines, were

provided at a cost of $180,000. In addition, 96 hand

pumps were installed in villages in the region, giving

locals potable water resources at their doorstep.

Another good indicator of the success of the projects

is that all of them have been handed over to the local

communities for them to run. These communities are

also bearing the ongoing fuel costs for the tube wells.

The VDOs have already developed a mechanism for

sustaining projects with self-help and volunteers.

Income generationAs part of their income generation activities, in 2003

Eni Pakistan and TRDP started a micro-credit scheme

in the Kirthar area with seed funding of $17,000.

Through TRDP and the network of VDOs, Save the

Children and the Pakistan Poverty Alleviation Fund

have also started micro-credit schemes in Eni

Pakistan’s concession areas. TRDP has disbursed an

additional $19,000 on these schemes.

The borrowers took small loans for small

enterprises, agriculture and livestock development. To

date, the beneficiaries total 107 people, including 21

women. The loan recovery rate is 98 per cent, and the

recovered funds will remain rolling to benefit

additional people during the Bhit project lifecycle.

Conclusion

The social mobilization, capital formation and capacity

building of the village development organizations have

empowered the local population at the grassroots

level. Their participation in decision making and BRSP’s

provision of opportunities for improving their quality of

life are paving the way to sustainable economic and

social development.

BRSP is moving towards becoming an independent

NGO with partnerships with key bilateral donors and

NGOs, and the synergies are being explored and

strengthened.



PARTNERS: GOV • NGO • O&G

LEVEL: local


Water resourcesdevelopment under theBhit Rural SupportProgramme


64

An education and rural development programme in Patagonia

Repsol YPF and the Cruzada Patagónica Foundation joined forces to

provide education and development opportunities to families living in

poor rural communities in western Patagonia.

Background

Repsol YPF is an oil company with operations in the

Argentine Patagonia region, mainly in northern

Neuquén province. The predominantly rural province is

home to a large number of people, most of them of

Mapuche origin, the indigenous population in that part

of Patagonia. Many of these people have unmet basic

needs and few development possibilities. The region

has been experiencing social unrest; social investments

from the private and public sectors in the past decades

have generated few positive changes.

In 2001, Repsol YPF formed a partnership with the

Cruzada Patagónica Foundation, to support a

comprehensive education and sustainable

development programme aimed at the communities in

the region where the oil company operates. Repsol YPF

is strongly committed to the region and recognized

that the foundation’s work was producing excellent

results in the western part of the province.

The Cruzada Patagónica Foundation brought to the

partnership 25 years of successful work and solid links

with the local communities. The foundation also

contributes awareness of, and respect for, the vision

and customs of the people it works with. In turn,

Repsol YPF provides knowledge of northern Neuquén

and its social problems, funding for specific projects

and consultancy on construction safety issues.

The partnership programme

The partnership programme works in three key areas:

education, rural development and institutional capacity

building.

EducationThe education work is based in the San Ignacio

Integral Education Centre in the village of Junín de los

Andes. The San Ignacio Centre is not a traditional rural

school: it offers not just secondary education and

professional training in electrical installation,

carpentry and other areas, but also primary education

for part-time adult students, plus vocational training in

forestry and agriculture.

The pupils come from families where the parents

are often illiterate and have few resources. Some come

from as far away as 500 km because there is no other

secondary school in the region with an agrarian-

technical orientation. The centre provides lodging and

daily transportation for students who need them.

Recognizing that education is the cornerstone of

development, the partnership allocates 60 per cent of its

budget to this aspect of the programme. The education

project offers scholarships for youngsters and adults

from rural communities, and funds the maintenance of

buildings, teaching materials and equipment.

Rural developmentTo complement the educational task and to expand the

development possibilities, a second project provides

technical assistance to implement family and

community micro-enterprises in marginal rural areas.

The rural development project helps in skill building

and in diversifying agricultural production.

The project includes the installation of greenhouses;

the monitoring, design and construction of water

distribution systems; the establishment of pastures and

water delivery in remote communities; and the recovery

of lakeshores and riverbanks through reforestation. It

receives 30 per cent of the programme budget.

Institutional capacity building A third project is institutional capacity building. The

partnership provides funds to strengthen the Cruzada

Patagónica Foundation, as well as community

organizations and public institutions in the region. In

Key partners

• Cruzada PatagónicaFoundation

• Repsol YPF,Argentina

• San Ignacio IntegralEducation Centre,Junín de los Andes,Neuquén province

KEYWORDS: community economic development; education

Diversifying agriculturalproduction

65

the process this also serves to strengthen the local

communities.

The institutional capacity building entails forming

alliances with other social organizations and

companies; developing training programmes; offering

advice; and working on public policies on education

and rural development. The partnership allocates

10 per cent of its budget to this work.

Progress

Since its start, the education project has funded more

than 400 students and almost 60 teachers, with 95 per

cent of graduates finding employment or developing

productive enterprises in their own communities, and

some of them even going on to university.

The rural development project has reached around

3,200 rural inhabitants, and the institutional capacity-

building project has run workshops for around 400

leaders and members of social organizations and public

institutions from all provinces in Patagonia.

The partners have collaborated for five years on the

education and sustainable development work, which is

a significant achievement. Effective two-way

communication between the partners is the strongest

element of the partnership. In addition, the mutual

trust that the partners have built is of particular value

in programme planning and execution.


In developing and implementing the three

programmes, the partners have faced a number of

challenges. One challenge was managing their

different approaches to time. In addition, in the early

stages, Cruzada Patagónica was uncomfortable at the

prospect of working with an oil company.

Overcoming the challenges led to lessons that the

partners have capitalized on to deepen and expand the

desired programme outcomes. For example, the parties

have undergone a mutual training period to better

develop projects that meet the needs of all

stakeholders. Also, a key learning is that, in social

programmes, results take time. Nothing can be

achieved ‘in 10 minutes’.

It has often been necessary to go back and adjust

the programme to meet new requirements. For

example when more company staff became involved in

the programme, they asked the foundation to upgrade

the safety features of the San Ignacio Centre where the

students live and study. Responding to this need

required that adjustments be made to the budget.

A willingness to work together and adapt to the

other partners’ different ways of working has enabled

the partnership to evolve, strengthen the relationships

with the beneficiaries and fundamentally ensure real

and lasting changes.

The work carried out by the divisions within

Repsol YPF and by the Cruzada Patagónica Foundation

has resulted in local appropriation of the programme.

In this specific case, the partnership approach was a

different way of reaching the indigenous people in

rural communities with whom the oil company had

historically experienced conflict.

Conclusion

The development of a region like Patagonia results

from the commitment and the work of all the sectors:

■ the private sector, which offers investment and

knowledge transfer to all members of society;

■ the public sector, which provides a wide reach and

a general overview; and

■ the social sector, which contributes sensitivity and

a commitment to service.

The Repsol–Cruzada Patagónica Foundation is an

example of the positive changes that can result when

different sectors work together for sustainable

development.



PARTNERS: NGO


LOCATION: South America (Argentina)

The education project hasfunded more than 400students.

The rural development programme has reached around3,200 rural inhabitants.

Greenhouses installedunder the ruraldevelopment project


66

Rural electrification in Morocco

Energy companies Total,Tenesol and Electricité de France set up the

Temasol company to operate a country-wide rural electrification

programme in Morocco.

Background

Today, more than 1.5 billion people on the planet,

many of them living rurally, have no access to

electricity. Moreover, in rural areas, a grid connection

is much more expensive than a connection to a

decentralized electricity supply.

The Rural Energy Services Company (RESCO)

concept, a viable, sustainable and replicable model, has

been developed to set up decentralized electricity

projects in various African countries. Total and its

partners, Tenesol and Electricité de France (EDF), have

used this model in Mali, South Africa and Morocco. The

partnership programme described here is the one set

up in Morocco.

In 1994, the Moroccan government launched a

national rural electrification programme, under which

virtually all rural households should have a power

supply by 2007, with 91 per cent connected to the grid

and 7 per cent receiving decentralized electrification,

mainly via solar energy. The scope of the programme

is challenging, as the target recipients are

geographically isolated, lack resources and have a low

standard of living.

Given the limited resources of the populations

involved, the Moroccan government identified the

need to establish a legal framework to define the local

operator’s mission. It also supplied financial support to

make the programme viable for the operator.

The Moroccan National Electricity Office (ONE)

began the electrification programme at experimental

level with a small number of villages. It soon became

aware of the need to scale up the programme and to

find innovative solutions to meet operating costs,

especially with regard to fee recovery. This is why it

looked for private partners.

Total is a company working on energy issues, with five

years’ experience on projects promoting access to energy

for rural populations in developing countries. When

ONE started looking for an operator to take over the

electrification programme, Total’s participation in such a

programme seemed logical.

The Temasol Partnership Programme

In 2002, the three partners, Total, Tenesol and EDF,

created a company, Temasol, to implement the next

phase of the electrification programme, ensure the

reliability of the systems and guarantee the quality of

the service provided. The total investment budget is

US$35.5 million. The project is financed mainly by the

ONE’s Electrification Programme (whose main funding

supports are: the German KfW bank, the French

Development Agency, the French Fund for the

Environment), with Temasol, local authorities and

customers providing the remainder.

The partnership’s primary objective is to provide

domestic electricity to 400,000 people, in order to

improve local living conditions. A second objective,

which was added to the programme in 2004, is to

provide drinkable water to people living in rural areas.

The partners also have specific objectives:

■ EDF—to provide access to energy to people who

are usually excluded from electrification

programmes. EDF has extensive knowledge of

photovoltaic energy and is willing to share it.

■ The Moroccan National Electricity Office (ONE)—to

provide access to electricity to all Moroccan

inhabitants, as a public service.

■ Total—to enable people to have access to (and also

to sell) energy.

Key partners

• Electricité de France

• French DevelopmentAgency

• French Fund for theEnvironment

• KfW Bank, Germany

• Moroccan NationalElectricity Office

• Temasol, Morocco

• Tenesol (previouslyTotal Energie)

• Total

KEYWORDS: rural electrification; transferable model

© T

otal

/M. D

ufou

r

Temasol techniciansand customer

67

Temasol is aiming to sell domestic energy services

to 58,500 households, which receive photovoltaic kits

that the households pay for over a 10-year period. The

company is in charge of the technical and financial

management, maintenance, equipment replacement

and fee recovery.

Progress

By the end of 2005, 20,000 households had already

benefited from the electrification programme operated

by Temasol. A further 38,500 households will have

access to electricity by 2008.

The programme has significantly improved people’s

lives in rural areas:

■ Households have easier access to communication

tools (radio, television and telephone) and benefit

from electric lights at night.

■ Children now have more facilities to do their

homework at night.

■ Safety in the home is improved as families no longer

use oil and paraffin lamps, candles and small petrol

generators, thus reducing the risk of accidents.

■ The electric lights are healthier, as they do not

damage the eyes.

■ Families are less inclined to overly restrict their use

of energy than they were when using candles

because the monthly fee for the electricity (which

is derived mainly from solar energy) is fixed,

regardless of the amount used.

By maintaining an informative marketing and

sales presence at local weekly markets, Temasol has

strengthened its contact with existing and potential

customers.

Since July 2004, Temasol has also been in charge of

the installation and management of solar pumping

equipment to provide drinking water. For the time being,

the programme is experimental and entails only 15

pumps serving 15 villages with around 5,800 inhabitants.

The benefits of partnering and lessons learned

Temasol For Temasol, the partnership is extremely positive.

Being Total’s partner gives credibility to the company,

strengthens its power of influence and facilitates its

access to bank credit.

The quality of the network implemented locally is a

key element in the success of the programme. Temasol

has a network of 22 agencies around the country and

extends its reach by attending the weekly markets.

TotalTotal views the partnership as constructive and the

partners as complementary. The programme was

successful in putting into practice a conceptual model.

It also allowed the creation of jobs (Temasol has 120

employees) and stimulated the local economy.

The most effective public-private partnerships are

those implementing projects and programmes rooted

locally and promoting the right balance between the

project/programme’s capacity for action and

innovation and an administrative framework that sets

the rules of the game and the goals to be achieved.

EDFEDF believes that the organization of such a

programme should be pragmatic, professional and

locally rooted. Such an approach ensures ongoing

technical maintenance, efficient fee recovery over the

long term, and programme ownership by the local

population and local public authorities.

If the beneficiaries do not participate financially, they

do not feel involved and responsible. Even if they are

poor, their contribution is important. It is also necessary

to pay attention to meeting the real and realistic needs of

the local population, and not to propose services that

people do not need and cannot pay for.



PARTNERS: GOV • NGO • B&I

LEVEL: national

LOCATION: Africa

© T

emas

ol

© T

emas

ol

Electrification foreducation

Douar in the Khemisset region


Florida’s first hydrogen energy station

Chevron is working with a state agency and a public utility to

develop Florida’s first hydrogen energy station, which will fuel a

small fleet of hydrogen-powered shuttle buses at Orlando

International Airport.

Background

To spur the development of clean energy technologies,

the state of Florida in the United States is working to

establish itself as a leader in the emerging hydrogen

industry. As of March 2005, Florida had more than 15

mobile and stationary hydrogen technology

demonstration projects under way, with another 13 in

the planning stage.

In early 2004, the Florida Department of

Environmental Protection (Florida DEP) contacted

Chevron about opportunities to work together on

advancing hydrogen technology. Chevron is committed

to developing clean, next-generation forms of energy.

Through its affiliate, Chevron Hydrogen Company, the

company has been accelerating innovation in the

production of hydrogen fuel from a variety of sources

and the development of a hydrogen infrastructure to

deliver that fuel. Chevron is exploring a number of

potential pathways to a hydrogen economy, including

applications in both

transportation and distributed

power generation. In the

transportation sector, Chevron is

concentrating on collaborative

demonstrations of fleet

applications, which the US

Department of Energy has

identified as an important mid-

term technology.

Florida DEP also invited

Progress Energy Florida, a utility

company, to take part in these

discussions. Progress Energy

supports innovative ways to use

and conserve energy sources

that protect the environment.

The company has participated in

a number of hydrogen-related initiatives in Florida,

including hydrogen-fuelled vehicle demonstrations and

the construction of fuelling stations.

As talks among the three parties continued over

several months, it became clear that they shared a

similar outlook. ‘We learned we were really on each

other’s wavelength,’ says Allan Bedwell, Florida DEP’s

deputy secretary for regulatory programmes and

energy at the time of the discussions. The three

potential partners recognized that they shared a zeal

for original problem solving and technical excellence.

Most importantly, they agreed on their overriding

strategic objective: to evaluate potential pathways and

challenges to the emergence of hydrogen as a

promising new fuel.

One of the projects under discussion was

developing a hydrogen energy station to fuel a fleet of

shuttle buses powered by internal combustion engines

(ICEs) that are designed to run on hydrogen fuel

instead of gasoline. Whereas fuel cells require that the

fuel be 99.999% pure hydrogen, hydrogen-powered

ICEs typically require a lower minimum level of

hydrogen. Supplying hydrogen which meets the purity

specification required by fuel cells is significantly more

expensive. The near-zero emissions from hydrogen-

fuelled ICEs deliver most but not all of the

environmental benefits of a hydrogen fuel cell. The

partners wanted to capture hard data that would allow

a careful cost-benefit analysis of the use of hydrogen

fuel in the two types of power trains.

The fleet of hydrogen-powered shuttle buses—

among the first of its kind—is anticipated to begin

transporting visitors at Orlando International Airport in

late 2006. Florida DEP sees the new hydrogen energy

station as the foundation for a ‘hydrogen hub’ in the

central part of the state. This network of fuelling

stations will serve growing numbers of demonstration

hydrogen fleets in the area, helping to validate and

commercialize the technology.


Because the partners in this public-private

collaboration had developed a strong working

relationship, they moved quickly on the energy station

project. Acting within an extremely tight time frame,

they selected a site at a Progress Energy Florida

Key partners

• Chevron TechnologyVentures

• Florida Departmentof EnvironmentalProtection (Florida DEP)

• Progress EnergyFlorida

KEYWORDS: demonstration project; transportation; hydrogen technology; energy efficiency

Hydrogen stands readyto fuel the fleet at a sisterstation in California

69

location, met with state representatives and local

officials, held numerous meetings with residents and

invited all interested parties to the ground-breaking

ceremony in February 2005. Thanks to the cooperation

among the partners, the outreach phase of the project

was a success.

The participants continue to cooperate as the

project moves into the implementation phase. Team

members schedule weekly telephone calls, and the

entire project team participates in a monthly

conference call. Upcoming challenges include locating

the facility at the site, obtaining the necessary permits,

handling liability questions and dealing with the

construction itself.

To date, the participants have learned or confirmed

the following lessons about how to build a successful

collaboration:

Agree on the main objectiveIdentify a mutually aligned strategic objective, which

acts as the collaboration’s compass and keeps the

project moving in a clear direction.

Rely on each partner’s strengthsSeek complementary but not overlapping skill sets. For

instance, Chevron develops and integrates the

hydrogen technology; Florida DEP guides the state’s

environmental and fuels policies; and Progress Energy

Florida brings a clear understanding of its customers’

energy needs.

Trust and learn from each otherStart from a position of trust. Understand and respect

each partner’s positions, limitations, decision-making

processes and organizational culture. Learn from the

other partners’ past experiences with similar projects.

Be flexibleBe open to a better way to do something. Stay focused

on the main objective, and adjust expectations if the

project does not unfold as anticipated.

Gather strong political supportInvolve high-level people within each organization

who are responsible for delivering results and have the

authority to make decisions quickly.

Share risks and resourcesEnsure that each participant has invested in the project

and is accountable for helping it succeed.

Get off to a good startIdentify potential flash points at the beginning, and act

to address them.

CommunicateEncourage candid discussions among team members. If

an issue develops, pick up the phone to resolve it,

rather than relying on broadcast e-mails. And have all

participants review external communications before

release.

Conclusions

Although all of the participants have participated in

similar collaborations, they claim that this has been a

model arrangement, based on trust, honesty and

open, straightforward communication. Going forward,

they feel confident about handling the challenges,

which have included the transfer of a pivotal member

off the team and the need to quickly begin working

with his replacement.

John Masiello, who is responsible for researching

and developing Progress Energy Florida’s programmes

in energy efficiency and alternative energy, says, ‘If you

go forward without this kind of information, you could

make mistakes that could be difficult to recover from.’

The long-term relationships that the partners are

building with each other and with the community are

essential in the next step to commercialization—the

broader adoption of the technologies. ‘In many respects,

the strategic relationships we are forming are as

important as the technologies,’ says Jeffrey Jacobs,

manager of strategy, planning and business

development for Chevron Technology Ventures’

hydrogen business unit.

The partnership’s experience to date serves as an

invaluable roadmap for others that intend to pursue

similar projects.


THEME: Fuels and transportation

PARTNERS: GOV • B&I

LEVEL: national

LOCATION: USA


70

Strengthening the hydrocarbon road transport sector in Madagascar

Total and its partners are increasing the professionalism of

hydrocarbon transport companies in Madagascar, improving road safety

practices and stimulating economic development.

Background

The hydrocarbon transport sector in Madagascar is

facing difficulties in running efficiently and according

to international industry standards. An ageing vehicle

fleet, high accident rates and lack of training as well as

poor road conditions and lack of regulation have been

identified as the main weaknesses of this economic sector.

In 2003, Total carried out a safety audit of the

sector. This led to the establishment of a steering

committee—in partnership with government agencies,

industry associations, and local and international

organizations—to further assess the issues.

As a first step, the steering committee conducted

an assessment of the hydrocarbon transport sector in

February 2004. The assessment revealed a crucial lack

of training, and of an organizational, safety and

inspection framework. The assessment covered 500

trucks, 500 drivers and 500 co-drivers. Enhancing the

professionalism of transport companies and tanker

drivers appeared vital in view of the risks involved in

transporting hazardous materials by road.

Following the assessment, the steering committee

appointed an operational team to implement a large-

scale partnership programme, known as PATH, for

developing the capacity of small and medium enterprises

(SMEs) in the hydrogen transport sector in Madagascar.

The PATH programme

The PATH programme is dedicated to improving

Madagascar’s hydrocarbon road transport sector. It also

aims to facilitate economic development in Madagascar

in accordance with the 10 principles of the United

Nations Global Compact. The programme operates

within the framework of the Growing Sustainable

Business (GSB) initiative, for which Total has agreed to

play the lead role in Madagascar and Cambodia. The

GSB initiative is brokered by UNDP and a national GSB

committee has been set up by UNDP local office.

The partners presented the PATH programme to the

Malagasy government, which had set transport as one

of its priorities, in particular with regard to improving

the country’s rail and road infrastructure. The

programme received government approval to proceed.

At the preliminary meetings the steering

committee defined four priorities, which aim to:

1. enhance the managerial skills of the SMEs

operating in the sector;

2. improve the professionalism of drivers and mechanics;

3. promote the modernization and maintenance of

the vehicle fleet; and

4. establish a formal regulatory framework (training,

hazardous materials driver’s licences, safety

regulations, inspections).

To this end, the steering committee proposed a

process to:

■ adapt the standards of the European Agreement

concerning the International Carriage of Dangerous

Goods by Road (ADR) to the local context;

■ appoint trainers, and train them in the methods of

the Association for the Prevention of the risks

related to Transport of Hydrocarbons

(APTH-France—the French association for

hydrocarbon transport risk prevention), so they

could go on to train drivers and co-drivers;

■ develop a managerial training programme for the

heads of road transport SMEs;

■ arrange for VOARISOA, a local NGO, to hold

environmental awareness seminars with company

managers; and

■ identify a local body able to take over PATH and

build on it over the longer term.

Key partners

• Agence universitairede la Francophonie

• Association for thePrevention of the risksrelated to Transport ofHydrocarbons(APTH-France)

• APTH-Madagascar

• Groupement desEntreprises deMadagascar

• Logistique Pétrolière,Madagascar

• Ministry ofTransportation,Madagascar

• Syndicat des Industriesde Madagascar

• Total Madgasikara

• United NationsDevelopmentProgramme (UNDP)

• VOARISOA (local NGO)

KEYWORDS: transport safety standards; economic development; training; global compact

Antananarivo city center

© T

otal

71

Progress

After receiving training in France, a team of six trainers

began training drivers and co-drivers in Madagascar.

More than 700 drivers and 300 co-drivers have

received training in several regions of the country

since October 2004.

At the outset, company managers were reluctant to

let their drivers miss five days of work for training in

the safety aspects of hazardous materials transport. But

after the managers had undertaken the training

themselves they became convinced that the request

was well-founded.

Given the success of the training programme, and at

the request of local authorities, training was extended

to include traffic police and private contractors. To date,

570 traffic policemen, as well as around 100 other

individuals, have also received awareness training in the

risks of hydrocarbon transport. Training for the national

police force is under consideration.

Over the same period, managerial skills training

was given to around 115 people from 58 transport

companies, representing the better part of

Madagascar’s hydrocarbon transport fleet.

Benefits and challenges

The benefits expected from the multi-sector

partnership include the following:

■ For the country: improvements in transport safety,

product quality, procedures and regulations, and

transparency of the transport sector conditions.

■ For hydrocarbon road transport companies:

improvements in efficiency, profitability, working

conditions and image.

■ For oil companies: improvements in efficiency and

in awareness and reduction of transport-related risks.

All partners see the benefit of the partnership work

in strengthening the sector; new and higher-quality

employment is being encouraged and a healthy

economy is being developed, contributing to the

development of the country overall.

The president of APTH-Madagascar, the local

syndicate of hazardous materials transporters, confirmed

the merits of the training and its members’ satisfaction

with it. VOARISOA is pleased with its participation in the

PATH programme and the accomplishments to date. The

Government of Madagascar views the initiative as

productive and valuable and welcomes the support of

international organizations in promoting the

development of this large island.

However, a number of institutional measures planned

to support the training programme have been slow to

see the light of day. One example is the local Ministry

of Transportation’s adaptation of the European ADR

regulations on hazardous materials transport. The

regulations were expected by the end of 2005. The ‘official’

recognition of the value of the training programme

should help to consolidate the regulatory process.

In a similar vein, the banking sector, which has a

favourable view of the initiative, judging it a ‘formative’

step for the sector, is showing interest in the SMEs as

clients, but is seeking interest rates close to the base

rate plus one or two points. Alternatives will need to be

found to facilitate access to credit by the SMEs, which

require funds to upgrade their substandard vehicle

safety equipment and replace their aging tanker trucks.

Finally, the local bodies identified as candidates for

taking over PATH have not (thus far) confirmed their

initial expression of interest.

Next steps

Ensuring the continuation of the partnership beyond

the PATH programme will require the formation of an

association of all the oil companies operating in the

country. Such an organization would oversee the

training for the hydrocarbon transport SMEs, as well as

solicit the participation of other companies involved in

road transport. Lobbying the authorities to secure the

implementation of a formal regulatory framework will

also be fundamental.

This successful experience may be adapted and

duplicated in other countries.



PARTNERS: GOV • IGO • B&I • RI

LEVEL: global/national

LOCATION: Africa

Road under repair

Main road fromAntananarivoto Toamasina

© T

otal

© T

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72

The Partnership for Clean Fuels and Vehicles

Launched at the 2002 World Summit on Sustainable Development,

the global Partnership for Clean Fuels and Vehicles assisted sub-

Saharan Africa countries in phasing out leaded gasoline by 2005 and

is aiming for global elimination of leaded gasoline by 2008.

Background

Many developing countries experience serious air

pollution, especially in their urban centres, and

emission sources usually include the transportation

sector. In 2000 nearly 100 countries were still using

leaded gasoline which perpetuates emissions by

precluding vehicle emission controls.

In early 2001 IPIECA made a unilateral decision to

support global phase out of leaded gasoline and to work

with governments to promote quick action. In mid-2001

IPIECA joined with the World Bank, the United Nations

Environment Programme (UNEP) and several NGOs to

convene a conference in Dakar where 25 sub-Saharan

African governments agreed, in the ‘Declaration of

Dakar’, to phase-out leaded gasoline by 2005.

In mid-2002, with the World Summit on

Sustainable Development (WSSD) only a few months

away, it appeared that several partnership initiatives

might be launched at that Summit to focus on the

phase out of leaded gasoline, and potentially other fuel

qualities, on a regional and global basis.

While these initiatives would broaden existing

individual efforts, a single global partnership was

clearly desirable.

Through a process of intense negotiation, the

individual parties agreed to band together under the

UN umbrella to form the Partnership for Clean Fuels

and Vehicles (PCFV).

The Partnership for Clean Fuels and Vehicles

The PCFV was launched at the September 2002 WSSD

as a public-private collaborative effort to help

developing countries reduce emissions by eliminating

lead in gasoline, reducing sulphur in transportation

fuels and introducing cleaner vehicles. The United

Nations Environment Programme (UNEP) hosts the

partnership, and the partners comprise governments,

industry, international organizations, NGOs and

academic institutions.

To provide advice and support to these countries,

the partnership holds regional, sub-regional and in-

country planning and technical workshops, produces

guidance documents and engages with government

decision makers.

From each stakeholder’s point of view, the PCFV

offered a means to advance goals that could not be

achieved individually:

■ With UNEP and World Bank encouragement, the

governments would provide the necessary

implementation of rules and specifications for the

phase-out process. The situation in sub-Saharan

Africa is particularly complex, as in many African

countries the fuel refining and distribution

infrastructure is partially or wholly state-owned.

■ IPIECA would explain gasoline refining and logistics

impacts to governments and communicate that

lower octane unleaded gasoline could be used in

place of leaded. The auto industry would

communicate that governments could go

immediately to unleaded gasoline without harming

in-use vehicles.

■ Other stakeholders, such as the United States

Environmental Protection Agency and various

NGOs, would play a critical role in facilitating the

partnership process and in giving a voice to

community organizations.

Challenges

Apart from the intense negotiations to form the single

partnership, several events challenged the PCFV in its

early stages, not least of which was the difficulty in

agreeing on a mission statement. Three years on, with

many of the initial objectives achieved or in sight, there

is an ongoing debate about revisiting the partnership

mission statement to re-validate the initiative.

As the partnership has grown to include more than

80 members, managing input and the work programme

in a structured way continues to be an issue. Despite a

clear vision for the inclusion of, for example, commercial

interests, the expansion of the partnership has raised

practical problems over the representation of smaller

Key partners1

More than 80 national andinternational agencies andorganizations, includingthe following who wereparticularly active in leadphase out in Africa:

Governments:• Democratic Republic

of Congo• Ghana• Mozambique• The Netherlands• Nigeria• South Africa• United States

of America

Industry:• Alliance of

AutomobileManufacturers

• InternationalPetroleum IndustryEnvironmentalConservationAssociation (IPIECA)

• Manufacturers ofEmission ControlAssociation

• National Associationof AutomobileManufacturers ofSouth Africa

• Petroleum Industry of East Africa

Internationalorganizations:• UN DESA• United Nations

EnvironmentProgramme (UNEP)

• The World Bank (not an officialmember of PCFV)

NGOs:• Natural Resources

Defense Council• Trust for Lead

Poisoning Prevention

KEYWORDS: air quality; vehicle emission controls; gasoline and fuel quality; UN umbrella

1 For a full list of partners in the PCFV, see www.unep.org/pcfv

73

states and the multiplicity of NGOs. These entities need

representation; however, arranging it in a practical way

through an advisory group has been challenging.

Some partners consider that setting more

concrete objectives within the broader partnership

aims would have been helpful for benchmarking the

partnership’s progress. Other partners suggest that,

at the start, the PCFV should have discussed a

timeline and also an exit strategy.

Lessons learned

The experience of establishing and maintaining the PCFV

has shown that voluntary partnerships can be an effective

way to implement environmental and health initiatives.

Oil and gas industry participants familiar with the

partnership see the following factors as key to the

success of the PCFV:

■ A strong motivation for working in partnership. The

partnering organizations recognized that none of

them could individually bring about cleaner fuels

and vehicles in developing countries.

■ Clear, well-defined, shared goals. The PCFV has

been most effective when the partners have strong

consensus on a goal and the means of attaining it

(e.g. eliminating lead from gasoline) and somewhat

less effective when no consensus exists on the best

way forward (e.g. reducing sulphur levels).

■ A simple yet definitive set of governance rules and

principles, agreed early on by all. The agreement

should ensure the balanced representation of

partners and include a process for resolving

disputes and handling commercial interests.

■ The establishment of a secretariat, preferably on

‘neutral ground’, to take the lead in organizing the

partnership and implementing its activities. UNEP’s

diplomatic skills and its role as a neutral partnership

facilitator have been invaluable to the PCFV.

■ Flexibility from all the partners and willingness to

seek compromise.

■ Use of the ‘Chatham House Rule of Confidentiality’

at PCFV meetings, to enable partners to openly

offer ideas and share information anonymously. For

meetings conducted under this rule:

(a) neither the identity nor the affiliation of the

speakers, nor that of any other participant at

that meeting may be revealed; and

(b) it may not be divulged that the information

was received at that meeting.

Conclusions

The partnership’s most notable success has been in

helping countries in sub-Saharan Africa phase out

leaded gasoline by the December 2005 deadline

envisaged in the 2001 ‘Declaration of Dakar’. Meeting

the deadline has only been possible through combined

efforts of the partners in the technical, political and

social arenas, in conjunction with national governments.

Although the emphasis has been on sub-Saharan

Africa, the partnership has also engaged with other

structures in Eastern Europe, Latin America and Asia. In

December 2005 the PCFV launched a new initiative to

eliminate leaded gasoline worldwide by 2008 in the 30

countries still using it.

UNEP’s executive director, Klaus Töpfer, has called

the PCFV ‘the most successful partnership emerging from

the WSSD’.

For more information on PCFV activities see

www.unep.org/pcfv



PARTNERS: GOV • IGO • NGO • O&G • B&I

LEVEL: global

LOCATION: Africa

Keynote speakers at the‘Dakar+2’ meeting ofthe partnership, held inNairobi in May, 2004

unle

aded

gas

olin

e av

aila

ble

(%)

2001 2002 2003 2004 2005 2006

0

25

50

75

100

leaded gasoline

leaded and unleaded gasoline

unleaded gasoline

June 2001 September 2002

September 2003

November 2004

January 2006

Lead phase-out progressin sub-Saharan Africa:per cent of unleadedgasoline available


74

The Alliance Program’s Safe Tank Alliance

The American Petroleum Institute and the National Fire Protection

Association are working with the US Occupational Safety and

Health Administration to help advance safe working practices in the

petroleum industry and, in the process, build a foundation for

continued collaboration.

Background

In March 2002, the Occupational Safety and Health

Administration (OSHA) established the ‘Alliance

Program’ as an addition to its suite of Cooperative

Program initiatives. The Alliance Program’s aim was for

participants to work collaboratively and to leverage

resources in reaching and educating the nation’s

workforce in advancing safety initiatives. As primarily a

regulatory and enforcement US federal agency, OSHA

saw the programme as a way to break down some of

the institutional and cultural barriers to the public and

private sectors working in unison to help advance

workplace safety.

Under the traditional compliance enforcement

model, the regulated community was reluctant to share

information or work with OSHA for fear of its

enforcement powers. As a result, an adversarial

environment has existed between OSHA and American

business since the Occupational Health and Safety Act

was enacted in 1972, thus preventing the sharing of

best practices and new approaches, and hampering

progress towards an accident-free workforce. To

address this situation, the Alliance Program separated

the compliance enforcement and the cooperative

outreach programs within OSHA.

Groups forming an alliance with OSHA include

employers, labour unions, trade and professional groups,

government agencies and educational institutions.

Participants sign a two-year agreement, which can be

renewed after the term expires. The Alliance Program is

funded by the organizations involved.

Since the Alliance Program’s inception, OSHA has

formed more than 400 alliances with such

organizations as the American Foundry Society, the

Industrial Trucking Association, the Shipbuilders

Council of America and the International Brotherhood

of Electrical Workers. The Safe Tank Alliance is one

such alliance.

The Safe Tank Alliance

In March 2004, the American Petroleum Institute (API)

joined into the ‘Safe Tank Alliance’ with OSHA and the

National Fire Protection Association (NFPA). All three

organizations agreed to work together on education

and outreach efforts to promote safe work practices

relating to petroleum storage tanks. Three elements

guide the Safe Tank Alliance: (1) training and

education; (2) outreach and communication; and

(3) promotion of the National Dialogue on Workplace

Safety and Health in the USA.

Each organization in the Safe Tank Alliance takes its

turn in funding approved projects, and also takes

ownership of and leads the project. For example, the

NFPA proposed and funded a project to develop pocket

brochures on safe welding and safe entry into

petroleum storage tanks.

Benefits and outcomes of the partnership

Although collaboration may sound simple, it took time

for the public and private sectors to fully realize its

benefit. Differences of approach were readily apparent.

The private sector tends to reward safe work

behaviours through bonus compensation programmes,

whereas the public sector relies on training and

education. Through the Alliance Program, it was

recognized that both approaches provide a

comprehensive solution to achieving a common goal.

The benefits of working together on making

workplace safety a priority are far reaching for all

parties. For example, businesses can experience the

following advantages:

■ be recognized as leaders in their industry;

■ be able to attract and retain highly qualified

workers;

■ maximize productivity as a result of a healthy

workforce, minimal production downtime and a

more positive work environment; and

■ reduce costs for workers’ compensation, regulatory

compliance and associated legal services.

The Safe Tank Alliance has already produced an

impressive suite of products and services. Product

Key partners

• American PetroleumInstitute

• National FireProtection Association

• Occupational Safety and HealthAdministration

KEYWORDS: safe work practices; cooperative regulatory environment; education; outreach

75

examples are the development of pamphlets on safe

hot work practices, safe tank entry, and fall protection

on tanks. In April 2005, Chevron hosted the Safe Tank

Seminar at its refinery in Richmond, California. The

seminar brought together more than 80 tank safety

professionals to share lessons learned and best

practices and to network. In addition, OSHA personnel

had a tour of the storage tank maintenance and repair

operations at the refinery.

In 2005/06, OSHA has proposed and is funding the

development of a ‘Confined Space E-Tool’. The E-Tool is a

multimedia interactive training device that can be

accessed though the OSHA website for information on

safely entering and working in a petroleum storage tank.

The E-Tool will contain a primer on the petroleum

industry and storage tank operations. It will also provide

up-to-date information on safe confined work, including

industry practice and OSHA regulatory guidance.

Due to the success of the Safe Tank Alliance in its

first two years, the initiative is expected to be renewed

for a further two years in 2006.

Conclusions

Perhaps the most important success of the Alliance

Program, and the Safe Tank Alliance, is the paradigm

shift in how the relationship between industry and

government is perceived and is being recast as a model

of partnership and collaboration. Slowly, the

adversarial mindset is being replaced with a culture of

cooperation, where all parties realize the immense

benefits of working together to advance workplace

safety and health. This shift has become evident in the

way the petroleum industry engages with OSHA. In the

past, it was not uncommon to have an industry

member sit on one side of the table and OSHA on the

other, with each group’s attorneys present to protect

their client’s rights. There was little open dialogue and

both parties shared only information relevant to the

issue at hand.

The OSHA Alliance Program has knocked down

those barriers. Alliance Program meetings are open and

informal, with no lawyers present. There is an honest

and open sharing of lessons and experiences that each

party can take back and incorporate into their

standards of operations.


THEME: Health


LEVEL: national

LOCATION: USA


76

The prevention of mother-to-child transmission ofHIV/AIDS in the Republic of Congo

Eni and the University of Genoa’s Infectious Diseases Department

are developing a project for the prevention of mother-to-child

transmission of HIV/AIDS in the Kouilou region of the Republic

of Congo.

Background

HIV/AIDS represents a devastating emergency,

particularly in Africa, where the epidemic increasingly

affects young adults, the most productive section of

the population, and so is ravaging national economies.

An increasing number of infected children are also

being registered, with most cases resulting from the

transmission of the virus from their mothers during

pregnancy, delivery and breastfeeding.

Operating in many of the countries hardest hit by

HIV/AIDS, Eni has promoted a number of programmes

aimed at halting the spread of the disease. The oil

company also networks with other players to share

experiences and improve the effectiveness of their

actions. The initiatives are part of Eni’s policy of

protecting the health of its employees and their

families, its contractors and its customers, as well as

improving the primary health of the communities in

the areas where it operates.

Eni Congo has operated in the Republic of Congo

for more than 30 years, and has actively cooperated

with local public health authorities on several

initiatives, with the restructuring of Talangaï Hospital in

Brazzaville being the most significant.

The prevention of mother-to-child transmission

(PMTCT) of HIV/AIDS has become a major priority for

many governments and international agencies in Africa.

It is consistent not only with the broader goals of

HIV/AIDS prevention, but also with the commitment to

improving children’s health and promoting their survival.

In 2004, Eni Congo began the development of a

project for the PMTCT of HIV/AIDS in Pointe-Noire in

the Kouilou region, in collaboration with the Infectious

Diseases Department of the University of Genoa in

Italy, which had already undertaken a number of

HIV/AIDS-related initiatives in the republic. The Kouilou

Health Department is the official partner in the project,

which has been included in the Congolese National

Health Plan to address HIV/AIDS.

The Project for the PMTCT of HIV/AIDS

The project for the PMTCT of HIV/AIDS is being carried

out at the Regional Hospital of the Army, one of the

main health structures in the town of Pointe-Noire. The

project provides free and confidential antenatal,

delivery and post-partum assistance to women and

their babies.

The project’s focal point is a molecular biology and

serology laboratory, located at the hospital, for the

diagnosis of HIV/AIDS infection in pregnant women.

Eni Congo financed and equipped the laboratory to

international standards. In addition to the supply of

advanced equipment, the hospital premises were

reorganized and a number of wards created. Local

medical personnel have also received training on the

different aspects of PMTCT.

The laboratory, which began operating in May

2005, has the potential to screen 100,000 patients in a

three-year period and can support the follow-up of

500 patients who are in treatment. The project aims to

test 3,000 pregnant women and treat 175 patients

during 2006.

The project also offers the following services:

■ voluntary and confidential pre- and postnatal

counselling services;

■ highly active antiretroviral therapy (HAART) for

pregnant seropositive women; and

■ prophylaxis for newborns during their first six

months of life.

An offshoot of the project is the improvement of

prenatal counselling at selected integrated health

centres in the region. The integrated health centres are

peripheral facilities that women can easily access

without being subjected to segregation or stigma.

As HIV/AIDS is both an immediate and a long-term

concern, complicated by individual culture and social

behaviour, the project also promotes community

awareness and action. Providing accurate information

on the practical aspects of the disease is crucial, since

many Congolese women ignore their HIV/AIDS-positive

status, and general knowledge on the transmission

risks of HIV/AIDS is low. The women are also mistrustful

Key partners

• Eni Congo

• Kouilou HealthDepartment, Republicof Congo

• National Program forAIDS Control

• Regional Hospital ofthe Army, Pointe-Noire, Republic ofCongo

• University of Genoa,Infectious DiseasesDepartment

KEYWORDS: maternal and child health; community education; capacity building

The project’s focal pointis a molecular biologyand serology laboratory.

77

of both caesarean section and bottle-feeding, which

are perceived as unnatural practices. Information is

being widely disseminated via training sessions at the

integrated health centres, as well as briefings, reports,

local television presentations and sensitization

meetings with local NGOs.


The partnership faced a number of challenges right

from the start of the project.

1. At the country level, particular attention was paid

to identifying the local bodies and individuals that

could play a role in the project, with a view to

avoiding ambivalent relationships with local groups

and any unwanted external pressure.

2. The partners had substantially different values. So

that they could adequately fulfil their obligations,

the first step was the development of shared

working practices using a business approach. The

partners created a management plan for the

project’s human, financial and technical resources,

as well as a set of performance indicators to check

the project progress and results. Planning for the

project’s components and for the partnership roles

also helped mitigate the difficulties.

3. The project’s Steering Committee and its Scientific

Committee regularly monitor the project’s progress.

Members of Eni Congo’s Health Department also

make on-site visits to review the results. The regular

checks give the partners the opportunity to consult

with each other.

4. Adopting an effective approach is fundamental in

gaining the trust of the target population. The

University of Genoa plays a key role in addressing

the social and cultural barriers to HIV/AIDS

prevention, as its medical personnel have

experience from fighting HIV/AIDS in the republic

and so combine scientific knowledge with

familiarity with the local culture and habits, and

can effectively undertake the communication and

sensitization activities.

Conclusions

The capability to diagnose mother-to-child

transmission of HIV/AIDS and to properly manage

antiretroviral therapy is critical for sustaining families

and communities. As a result of the synergies among

the partners, the project will give pregnant women and

newborns greater access to affordable and high-quality

prevention and treatment.

In addition, training local healthcare personnel is a

prerequisite for capacity building and for long-term

sustainability of the project. Once the project is

transferred to the community, the laboratory will

continue to provide those services—still beyond the

reach of most developing countries—that substantially

reduce morbidity and mortality.

Moreover, the partnership’s lessons learned, results

obtained and skills acquired form a ‘package’ that could

be easily replicated in other contexts, where local

healthcare services have neither the resources nor the

capacity to implement their own antiretroviral therapy

programmes.


THEME: Health

PARTNERS: GOV • NGO • RI

LEVEL: national

LOCATION: Africa

Regional Hospital ofthe Army, PointeNoire, Congo


78

The use of insecticide-treated mosquito bednets in malaria prevention in sub-Saharan Africa

In partnership, ExxonMobil and NetMark have worked to distribute

affordable insecticide-treated bednets and to promote their use as an

effective malaria prevention measure.

Background

Sub-Saharan Africa is an area of significant growth for

the oil and gas industry. Tragically, the malaria

epidemic kills more than one million people a year in

sub-Saharan Africa. Every year, at least 300 million

acute cases of malaria are suffered globally, resulting in

more than 1.2 million deaths. Nine of 10 malaria deaths

occur in sub-Saharan Africa, mostly in young children

and pregnant women. In fact, an African child dies from

malaria every 30 seconds.

Economists report that malaria reduces economic

growth in many African countries. Health

improvements are a prerequisite for broader economic

and social development and are high on the agenda of

host governments. Although there are proven and

effective interventions in the fight against malaria, the

reality is that the disease has become increasingly

resistant to previously effective medicines, requiring an

even greater emphasis on prevention.

With petroleum production, retail marketing and

distribution in many African countries, ExxonMobil is

keenly aware of malaria’s devastating impact and is

working with others to combat this preventable disease.

The oil company has specific interest and expertise in

community malaria control. Since 2000, ExxonMobil’s

anti-malaria programme has expanded from a strong

workplace programme to its broader Africa Health

Initiative focused on drug research and development;

advocacy of increased international awareness and

resources; and community-based projects on malaria

prevention, education and treatment.

The Help Us Help programme

One of the simplest and most cost-effective means of

malaria prevention in Africa is the insecticide-treated

bednet, which protects people from mosquito bites.

NetMark, a project of the Academy for Education

Development (AED), operates in multiple countries to

increase the supply and demand of insecticide-treated

bednets. NetMark receives United States Agency for

International Development (USAID) funding for its

work, which also includes conducting health cause-

related marketing and malaria prevention education,

accessing transnational distribution and promotion

networks, and expanding the capacity and product

quality of African-based bednet manufacturers.

In 2002, the ExxonMobil Africa Fuels Marketing

Group teamed with AED/NetMark to set up the Help Us

Help programme. The programme seeks to reduce the

burden of malaria in sub-Saharan Africa by increasing

the commercial supply of and public demand for

insecticide-treated bednets. The focus of the programme

is on communicating the necessity of behavioural

change, providing health education information and

conducting related promotional activities.

The programme has mounted a series of campaigns,

beginning with a pilot ‘Help Us Help’ campaign in

Zambia in 2003. After the successful pilot in Zambia, the

campaign approach was improved and campaigns were

run in Ghana in 2004 and Nigeria in 2005. Zambia and

Ghana ran second Help Us Help campaigns in 2005, and

Cameroon will soon start a campaign.

Key partners

• Academy forEducationDevelopment/NetMark

• ExxonMobil AfricaFuels MarketingGroup

• United States Agencyfor InternationalDevelopment(USAID)

KEYWORDS: community health; education and outreach; product distribution

The promotional bannerof the ‘Help Us Help’programme

Children at an African orphanage in receipt ofHelp Us Help funds

79

In the campaigns, coupons for the purchase of

bednets are distributed to local residents, including

pregnant women, at area medical clinics and antenatal

clinics. The coupons can then be redeemed at service

stations in ExxonMobil’s retail network to purchase

discounted insecticide-treated bednets. The service

stations also donate a portion of gasoline sales to

provide free bednets for local orphanages.

About 80 per cent of the coupons distributed in

Zambia and Ghana were redeemed for bednets,

demonstrating the success of this approach in getting

nets to people who need them.

Outcomes and benefits of the partnership

The ‘Help Us Help’ programme draws on ExxonMobil’s

experience in developing and implementing large-

scale public-private partnerships.

The NetMark concept uses public-private

partnerships to build a sustainable commercial market

for better quality insecticide-treated bednets while also

delivering free or subsidized products to the most

vulnerable populations.

David McGuire, NetMark Project Director, states,

‘ExxonMobil’s participation in the partnership served as a

catalyst in terms of both programme impact and

corporate social responsibility. Public health results were

achieved by the partners in improving insecticide-treated

bednet production, distribution and promotion at the

country and global level. Both AED/NetMark and

ExxonMobil benefited from this joint initiative.’

Lessons learned

Successful public-private partnerships like this one

ensure that they do the following:

■ Recognize and utilize participant core

competencies and attributes. For example, the

programme makes effective use of ExxonMobil’s

downstream retail network to educate

communities on malaria and the use of bednets to

minimize risk.

■ Help to capture value and provide mutually

competitive advantages for each participant.

■ Identify and allow for individual participant

incentives and benefits.

■ Create project goals that are a composite of the

participant incentives and benefits.

Among the lessons learned is that partnerships

entail built-in shared risk, joint participation and shared

returns. Therefore, it is critical to do the following:

■ Define a formalized partnership governance

structure and equitable, mutually agreed-on

ground rules from the outset.

■ Formulate realistic and achievable objectives at the

beginning. The partnership used a focused scope of

work, deliverables and clear metrics to measure

programme success.

■ Maintain participant flexibility and adaptability to

meet evolving circumstances and mutual

requirements during the programme’s operation.

For example, flexibility in implementation may be

needed to address local Ministry of Health

priorities. The partners found that the programme

worked best where NetMark had established

strong ties with the Ministry of Health and had

aligned its priorities with those of the national

malaria control centre.

Conclusions

Although there are proven and effective interventions

in the fight against malaria, the disease still devastates

the health of African people. This partnership

represents just one of many approaches to address the

needs of at-risk people, particularly women and

children, in reducing the impact of the disease.

The success of the AED/NetMark–ExxonMobil

partnership in Africa is a testament to the value of

combined organizational core competencies and social

responsibility efforts in making a positive difference in

developing countries.


THEME: Health

PARTNERS: GOV • NGO

LEVEL: regional

LOCATION: Africa

A Cashier in a MobilService Station On TheRun convenience storeexplaining the voucherredemption process toDr Awa Coll-Seck,Executive Director of RollBack Malaria. Looking onare Vinand Nantulya,Senior Advisor–GlobalFund, and LocalRepresentative ofNetmark.


80

The Bioko Island Malaria Control Project

Marathon Oil and its corporate, university, government and other

partners have developed an ambitious plan to eliminate malaria from

Bioko Island, Equatorial Guinea,West Africa.

Background

When Marathon Oil first entered Equatorial Guinea in

2002, it quickly identified the malaria parasite

(Plasmodium falciparum) as a significant health threat

facing its employees and the local communities on

Bioko Island. Malaria on Bioko Island was endemic, with

one of the highest transmission rates in sub-Saharan

Africa. It was also the cause of approximately 40 per

cent of all mortalities and a major contributor to a

17 per cent mortality rate for children under five years

of age (20 times higher than the childhood mortality

rate in the USA).

To meet this critical threat head-on, Marathon and

its business partners teamed up with the Equatorial

Guinean government and health specialists to design a

comprehensive malaria eradication project for Bioko

Island. The partnership worked collaboratively and

rapidly to roll out the ‘Bioko Island Malaria Control

Project’ (BIMCP).

The Bioko Island Malaria Control Project

The project has three main objectives:

1. Terminate transmission of the malaria parasite

through control programmes and improved

preventive measures at the household and

community levels.

2. Improve the healthcare delivery system for malaria

cases through centres using standardized protocols

for diagnosis and treatment.

3. Upgrade monitoring and operational research.

Steve Hinchman, Marathon’s senior vice-president

of worldwide production, was instrumental in setting

the project objectives. ‘Besides extracting oil and gas,’ he

emphasized, ‘we want Marathon to leave a positive,

sustainable mark on Bioko Island.’ The malaria project

presented a unique opportunity.

The BIMCP was also designed so that the Ministry

of Health and Social Well-being (MoH) in Equatorial

Guinea could build the necessary capacity to sustain

the project via a continuing and progressive transfer of

responsibility over five years. Thus, all activities have

been closely planned with the MoH and integrated

within existing systems; a detailed integration strategy

was introduced in the second year of the initiative.

Key to the capacity building aspect of the project is

local community involvement and cooperation, which

the partnership recognizes as being crucial to the

project’s ultimate success. Dr Justino Obama Nve,

Minister of Health and Social Well-being, remarked: ‘The

community’s cooperation and involvement in the fight

against malaria are critical to ensure preventive measures,

early diagnosis, and prompt and effective treatment of this

disease. Marathon’s partnership in this effort has greatly

strengthened our local capabilities.’

The five-year project was initiated in 2003 with the

first round of indoor residual spraying (IRS) completed

in 2004. Synchronized with the spraying has been the

project’s case management component, focused primarily

on children under 15 and pregnant women. The work

has entailed training healthcare providers, supplying

health centres with diagnostic kits and medicines, and

conducting community education and communication

programmes. Distribution of treatment drugs is

ongoing. In addition, the surveillance programme

completed a baseline study in February 2004.

Monitoring and research continue around the island.

Progress

After the first round of indoor residual spraying of the

vertical surfaces of 100,000 structures on Bioko, the

number of mosquitoes infected with the malaria

parasite was reduced by 80 per cent. This reduction

translated to a 30 per cent drop in the presence of

malaria parasites in children on the island. The lowest-

income households have also received particular

benefits, with the cost burden for malaria treatment

dropping from an average of 10 per cent of household

income to around 4 per cent.

While some rebound is expected, successive rounds

of IRS are projected to continue a downward trend,

leading to a dramatic reduction in malaria transmission

on the island.

Key partners

Companies:

• GEPetrol

• Marathon OilCorporation

• Noble Energy

• Sonagas

Technical and researchorganizations:

• Harvard School ofPublic Health

• Medical CareDevelopmentInternational

• Medical ResearchCouncil of SouthAfrica

• One WorldDevelopment Group

Government:

• Ministry of Healthand Social Well-being,Equatorial Guinea

KEYWORDS: community health; capacity building; sustainability assurance

Community cooperationand involvement are keyto the project’s success.

81

In regard to capacity building, the project has

trained 80 Equato-guineans as sprayers and

supervisors. Others are monitoring window traps at

representative sites around the island.

‘This project has been one of the most successful and

smoothest ventures we’ve been involved in,’ says Chris

Schwabe of Medical Care Development International

and BIMCP’s project manager. ‘Working in these kinds

of environments is extremely challenging, but Marathon’s

connections in Equatorial Guinea, and at all levels within

the government and the community, eliminated the

typically slow build-up period. We’ve been able to

implement it at an unparalleled rate compared with

other projects.’

MoH’s Dr Obama Nve affirms the project’s

achievements: ‘I am delighted by the early successes. By

aligning the project objectives with our national strategy

to fight malaria, and integrating ministry staff in all

phases of the project, we are building the foundation for a

sustainable programme.’ MoH is becoming well

positioned to assume full responsibility for the

programme at the end of the five years.

Lessons learned

As Joseph Carter, director of Medical Care Development

International, has said, ‘the multi-stakeholder

partnership brings together the resources and capacities

of the private sector, the government, research

institutions and civil society.’ Carter has also indicated

that BIMCP is different from many such programmes

for several reasons, among which is ‘the early and

concerted commitment of the BIMCP to an integration

strategy designed to enhance the likelihood of long-term

sustainability. The excellent early results suggest that

sustainable success is achievable.’

The partners identified some key success factors in

the partnering process:

■ Multi-stakeholder partnership—full private-public

sector collaboration, with government support and

technical and research organization participation.

The project was fully a ‘team’ effort.

■ Well-integrated, multi-year plan—flexible and

detailed, with a strategy for programme

continuance for the five years.

■ Community involvement—especially important for

local health resource personnel responsible for case

management (diagnosis and new treatment

protocols), as well as for the indoor residual

spraying component.

■ Education and communications—at local levels,

using multiple languages and multiple methods.

■ Sustainability assurance—ensures local acceptance

and buy-in, as well as sustainability beyond the

five-year plan. In addition, the positive results have

enabled the government to expand the project

concepts and elements to the mainland via Global

Fund financial support.

Conclusions

With two successful spraying campaigns completed by

the end of 2005, as BIMCP enters into its third year of

implementation, the relationships have been

strengthened and all participants remain excited and

optimistic about the progress and path ahead. The

ambitious goal of malaria eradication from Bioko Island

seems attainable. As Marathon’s Hinchman says, ‘It is

very gratifying to be involved in a project that shows such

promise to benefit the lives of thousands of people.’

Marathon and its partners remain firm in their

commitment to the BIMCP and recognize the early

programme successes provide a springboard for future

partnerships.


THEME: Health

PARTNERS: GOV • NGO • O&G • RI

LEVEL: local

LOCATION: Africa

before spraying after spraying0

0.5

1

1.5

2

2.5

before spraying after spraying0

10

20

30

40

50

30%

80%

Results from the 2005parasitemia and prevalencesurveys following the firstround of spraying onBioko Island

Mosquito and malaria parasite statistics before and after the first round of spraying

a) average number of infected mosquitoscaught in the home

b) percentage of children with malariaparasites in their blood

A health specialist at work


82

The Voluntary Principles on Security and Human Rights

Launched in 2000, the Voluntary Principles on Security and Human

Rights is an international tripartite initiative designed to assist energy

and extractive companies in maintaining the security of their

operations globally while ensuring respect for human rights.

Background

In early 2000, the US and UK governments, a number of

extractive and energy companies and several

international human rights NGOs initiated a year-long,

multi-stakeholder process to address security and

human rights concerns. The participants customized

human rights guidelines for the extractive and energy

sectors that address security issues and provide

practical guidance on implementation. Officially

announced in December 2000, the Voluntary Principles

on Security and Human Rights (Voluntary Principles)

cover three key areas: (1) conducting a comprehensive

risk assessment of security and human rights issues,

with criteria designed to build accountability;

(2) engaging with public security forces (military and

police); and (3) engaging with private security forces.

The Voluntary Principles initiative illustrates the

opportunities and challenges of a tripartite approach, as

well as the strengths and legitimacy that each partner

brings to the process. Companies offer the experience of

working on the ground and the reality of implementing

at an operational level. Home governments are able to

convene diverse stakeholders around mutual goals and

provide diplomatic channels to engage host

governments. NGOs bring an expertise in human rights

issues, including knowledge of local civil society in the

regions where companies operate. NGOs also see their

role as challenging the process and its members to build

momentum and drive the process forward.


The Voluntary Principles have gained support from the

private, public and civil sectors globally since their

launch five years ago. In addition to the current 27

official members, a number of other companies have

adopted and implemented the Voluntary Principles.

Moreover, multilateral institutions such as the

International Finance Corporation and the Organization

for Economic Co-operation and Development are now

referencing the Voluntary Principles in their guidelines

and standards.

Each of the 16 official company members has

approached implementation of the Voluntary

Principles in a different way, and their progress has

also varied. However, companies on the whole have

achieved significant milestones in the initiative’s first

five years. Specifically, all companies include the

Voluntary Principles in at least some of their contracts;

most companies have a process for anonymously

reporting human rights abuses and offer ‘whistle-

blower’ protection; many companies believe the

Voluntary Principles have increased awareness of

human rights and security issues among their staff;

and a number of companies have conducted Voluntary

Principles-related training for public and private

security, and company staff.

Partners have found the greatest implementation

challenge to be engagement with host governments

regarding public security. The members have

attempted to overcome the challenge by leveraging

the multi-stakeholder nature of the initiative and

taking a coordinated approach using ‘in-country

Key partners

Companies:

• Anglo American

• BG Group

• BHP Billiton

• BP

• Chevron

• ConocoPhillips

• ExxonMobil

• Freeport McMoRan

• Hess

• Marathon Oil

• Newmont Mining

• Norsk Hydro

• Occidental Petroleum

• Rio Tinto

• Shell

• Statoil

Governments:

• The Netherlands

• Norway

• United Kingdom

• United States of America

NGOs:

• Amnesty International

• The Fund for Peace

• Human Rights First

• Human Rights Watch

• International Alert

• Pax Christi

Observer:

• InternationalCommittee of theRed Cross

• IPIECA

KEYWORDS: voluntary guidelines; risk assessment; in-country working groups

A number of companies have conducted VoluntaryPrinciples-related training.

83

working groups’, comprising various companies from

the energy and extractives sectors along with home

government members. This coordinated approach

reduces the exposure of any one company and

increases the likelihood of progress. In-country

processes have already been established in Indonesia

and Colombia. Several companies in the Indonesian

process have signed memorandums of agreement with

regional police forces, and the Colombian process

drafted best-practice guidelines for risk assessment and

initiated ongoing best-practice exchange workshops.

However, a common challenge for both of these in-

country processes has been a lack of NGO involvement,

which both groups continue to address. Companies

have also called for increased support from home

government partners in their role as a diplomatic

channel. Partners have discussed the value of offering

official membership in the Voluntary Principles to host

country governments, as well as private security firms

and multilateral organizations, although a number of

concerns would need to be addressed first.

In addition to implementation challenges, the

Voluntary Principles process itself has identified the

need to increase transparency, including regular

reporting, to maintain and increase the initiative’s

legitimacy, credibility and integrity. Members feel

pressured to demonstrate results, or at a minimum to

detail their implementation efforts and prove that they

are doing more than just endorsing the Voluntary

Principles brand. To date, the Voluntary Principles

process has not mandated any formal public reporting

of implementation efforts by process participants.

However, an informal information-gathering exercise in

2005 captured company implementation efforts, and

some companies now report their implementation

efforts in their annual social responsibility reports.

The original governance criteria stated that

companies could only formally join the Voluntary

Principles process if their home country government

also joins the process. This requirement has now been

removed and any company may now submit a formal

request, via the Secretariat, to participate in the

process; however, home governments will also be

strongly encouraged to participate. Meanwhile current

participants, through a working group, continue to

review the existing governance language and will

release revised participation criteria by the end of 2006.

Conclusions

The Voluntary Principles process involves a diverse set

of stakeholders, often in opposition to one another,

who have been able to identify common interests and

work together constructively. As expected, such a

process is extraordinarily difficult to manage and

requires delicate finessing to balance the different

stakeholder interests. As with most initiatives of this

nature, building trust between such diverse partners

has been slow and hard-won. Trust has improved over

the past five years as the partners better understand

each other and their goals.

The Voluntary Principles initiative demonstrates

that a tripartite partnership can begin to address issues

that may be impossible for any single actor to attempt

to resolve alone.

For more information on the Voluntary Principles see

www.voluntaryprinciples.org


THEME: Human rights

PARTNERS: NGO • COM

LEVEL: global

LOCATION: global

Security guards on duty in Indonesia


84

Human rights training of Sharia judges in Nigeria

The three-year partnership between Statoil and the Legal Defence

and Assistance Project is introducing Sharia judges in northern

Nigeria to human rights issues and legislation.

Background

Statoil has been active within oil exploration in Nigeria

since 1992 and has supported corporate social

responsibility (CSR) projects in the county since 1996.

Statoil’s CSR projects entail partnerships with either

NGOs or UN organizations. The company does not have

its own field staff for these projects, instead choosing

to focus on its area of expertise—exploring for oil and

gas—while its partners implement the selected CSR

projects.

After years of undemocratic leadership and neglect,

and numerous breaches of human rights, Nigeria had

turned its attention to addressing the issues. In 2001,

Statoil decided to support organizations working on

human rights issues in the country. This support would

be in addition to the award-winning Akassa community

development project and some less extensive support

of other NGO projects.

When Statoil’s management granted US$100,000

for support of human rights work in the country for

2002, the search started for suitable projects. Splitting

the grant into four smaller grants of $25,000 each, the

company looked for low-profile, Nigeria-based human

rights organizations and not branches of large,

international human rights organizations.

In Nigeria, hundreds of NGOs work on human

rights issues, and Statoil was aware of some NGOs

being set up solely to ‘milk’ contributors. To avoid

becoming the victim of a scam, the company spent

significant time and effort screening potential

cooperation partners.

Meeting with its shortlist of 10 organizations,

Statoil asked for proposals for projects that could be

implemented within one year. The company also stated

its intention to establish a long-term partnership after

the first year if both parties saw the value. From the

proposals submitted, Statoil selected those from three

organizations: the Legal Defence and Assistance Project

(LEDAP), the Civil Liberties Organization and the

Prisoners Welfare and Rehabilitation Action.

The text below reports on the project that was set

up to train Sharia judges on human rights principles.

The Sharia judge training project

Established in 1996, LEDAP is an NGO with

headquarters in Lagos and branch offices in five states.

LEDAP’s members are lawyers or others with

professional legal training. The organization

disseminates legal knowledge and insight about

human rights and good governance within Nigeria.

The LEDAP proposal that Statoil agreed to fund was

to teach and train Sharia judges from a number of

northern states that have implemented Sharia, or

Islamic law. Sharia judges at local level often have

limited formal legal insight and training. Some might

even be illiterate. They are mainly religious leaders and

make their judgements drawing on Islamic teachings

and guidelines from the Koran. Many of the judges are

unaware of Nigeria’s position regarding the UN

‘Universal Declaration of Human Rights’ and other

human rights resolutions.

LEDAP developed and delivered two-day training

seminars for the Sharia judges on the following:

■ human rights principles;

■ women’s rights;

■ just interrogation principles and their integration

into the administration of Islamic law; and

■ legal procedures and administration.

Progress

The three years of training have given 450 Sharia

judges from 7 northern states an insight into human

rights questions. This amounts to approximately

20 per cent of the total number of Sharia judges in

the country.

At the start, the partners had questions about what

might result. For example:

■ Would Statoil’s enabling of LEDAP through project

financing (and selection) involve the oil company in

one of the currently ‘hot’ political questions in

Nigeria: the unilateral introduction of Sharia

legislation in some of the Islam-dominated

northern states?

Key partners

• Legal Defence andAssistance Project,Nigeria

• Statoil, Norway

KEYWORDS: human rights; legal training

85

■ How would the governors and the political leaders

in those states respond to the human rights

training focus on Sharia judges only (and not an

offer to all judges)?

■ Would the Sharia judges accept training on human

rights thinking from lawyers representing the

‘British law’ system?

After three years, both Statoil and LEDAP report

that their experiences have been positive and their

concerns unfounded. Specifically, Statoil has had no

accusations from government officials or observers of

interference in the country’s political processes.

Moreover, administrators in some states have

established links to LEDAP and, from time to time, use

its staff as legal consultants and advisers.

Most importantly, the training has been popular

and well received by the Sharia judges. For instance, in

the evaluations of two seminars in 2004, all

participants stated that the training had given them

knowledge that was directly applicable to their daily

work as Sharia judges.

From sponsorship to partnership

A significant reputation risk of operating in Nigeria is

the expansion of the Sharia legal system, which might

become a major threat to the stability of the Nigerian

federation and hence to international companies doing

business in the country. As a way to understand the

expansion and its implications, Statoil established a

dialogue with LEDAP so that the oil company might

draw on the NGO’s special insight into questions of

Islamic law.

Statoil has also used representatives from LEDAP as

presenters in the company’s staff seminars on ‘Nigeria

awareness’.

The relationship has gradually developed from one

which provides support to an NGO ‘working on a good

cause’ into a partnership which involves consultations

on questions of strategic significance.

Lessons learned

The experience with the Statoil–LEDAP partnership to

date has led to the following learnings:

■ Be bold when picking partners and projects.

According to some observers, selecting human

rights, partnering with LEDAP and training Sharia

judges were bold actions.

■ Spend time evaluating potential partners and

selecting partners.

■ Build relations also with people, not only with

organizations.

■ Spend time on mutual understanding of project

tasks and expectation levels.

■ Set up a simple but clear partnership contract. Be

sure to build in start and end dates.

■ Establish a tight dialoguing and monitoring system.

■ Release funds based on milestones and reporting.

■ Ensure that the funder has a way to exit the

partnership so that the ending of the funding will

not harm the project.

Conclusion

Statoil considers the reputation risk in setting up an

NGO human rights partnership in Nigeria to be high,

and the reward to be limited. On the other hand, this

type of human rights partnership is at the core of the

company’s CSR strategy and is why it has undertaken

this and similar initiatives.


THEME: Human rights

PARTNERS: NGO

LEVEL: national

LOCATION: Africa


86

Action on oil spills: the IMO/IPIECA Global Initiative

Formally launched in 1996, the Global Initiative is an umbrella

programme under which the International Maritime Organization

(IMO), the oil industry (through IPIECA) and other partners are

working together to encourage and facilitate the development and

implementation of oil spill contingency plans and increase the

ratification of oil spill-related international conventions.

Background

Major oil spills are unfortunate events that can have

high impact on the surrounding environment and

nearby communities. Short- and long-term effects of

the resulting pollution can greatly distress the local

socio-economic structure as well as the environmental

integrity of the impacted area.

Although ongoing work on preventative measures

within IMO and other organizations is driving down the

number of major spills, the risk cannot be reduced to

zero. The reality is that events beyond the scope of

human control (such as extreme weather conditions)

will always remain.

Against this background, the oil and shipping

industry has become increasingly conscious of a need

to improve its capacity to respond to spills through the

development and implementation of sustainable oil

spill preparedness and response systems. The

realization is also growing that capacity building

requires a joint effort by key stakeholders such as local

industry, governments and non-governmental

organizations, particularly if plans are to accommodate

and respond to local conditions. To this end, IMO and

IPIECA work closely to encourage and facilitate

cooperation between the relevant authorities and the

oil industry at national and regional levels.

A brief history of the Global Initiative

The IMO is a specialized agency of the United Nations

that aims to improve the safety and security of

international shipping and prevent marine pollution

from ships. The International Convention on Oil

Pollution Preparedness, Response and Co-operation,

1990 (more commonly known as the OPRC

Convention) designates the IMO as responsible for

improving effective and sustainable preparedness

measures to ensure timely and efficient response to oil

pollution around the world through education,

training and technical assistance, and also explicitly

recognizes the role of the oil and shipping industry in

addressing this area.

Wishing to respond positively to the objectives of

the OPRC Convention, the oil industry requested IPIECA

to develop a basis for cooperative action with the IMO.

The IMO’s skills and expertise complement the

technical knowledge, oil spill experience and ability to

engage local industry that IPIECA, its industry

constituents and its technical partners (for example the

International Tanker Owners Pollution Federation)

bring to the relationship.

At a workshop in Cape Town, South Africa in 1996,

the Global Initiative (GI) was formally launched, with

the aim of encouraging and facilitating the

development and implementation of national, regional

and sub-regional oil spill contingency plans

(particularly in developing countries) and increasing

the ratification of relevant international conventions.

Although also active in the Caribbean, the

Mediterranean, Caspian and Black Seas, and South Asia,

Key partners

• International MaritimeOrganization (IMO)

• InternationalPetroleum IndustryEnvironmentalConservationAssociation (IPIECA)

KEYWORDS: contingency planning; regional cooperation; international conventions

Beach boom deployment

Speakers at the regionaloil spill workshop inAngola, in November2000, organized byIMO and IPIECA

87

much of the early GI effort focused on the West and

Central African (WACAF) region. Technical missions and

training workshops/courses resulted in a substantial

increase in African nations’ ratification of relevant

conventions between 1996 and 2003. It became

apparent, however, that more needed to be done in

terms of technical assistance to complement the

activities implemented in the region since 1996 in

order to ensure that all of the 21 WACAF countries had

an acceptable state of preparedness and operational

national contingency plans in place. A reassessment of

the process underlined the limitations of the initial

approach, which consisted primarily of a series of

technical missions, in building sustainable local

capacity. The GI has therefore modified its approach to

a planned, budgeted process supported by IMO and

industry business units in targeted countries to

facilitate cooperation between government authorities

and the oil industry. This realignment to a nationally

and regionally based model puts local stakeholders,

rather than London-based staff and secretariats, at the

heart of the process.


Successful partnerships can be defined in many ways,

but most are underpinned by mutual trust,

understanding and respect; shared vision and goals; a

shared responsibility; and a willingness to work

together on equal terms. For the GI, success has

certainly been built on these characteristics, but also

on mutual recognition of each partner’s strengths and

weaknesses and an adaptive approach that reinforces

positive progress and facilitates sustainable

engagement with relevant policy makers. Throughout

the journey, the partners have been faced with a range

of challenges and opportunities. From these have come

some key lessons:

The level of commitment of each partner can bedifficult to quantifyThere is no standard ‘currency’ for commitment. When

partners are channelling different types of equity into a

partnership (for example ‘sweat equity’, funding and in-

kind support), ensuring that the commitment of each

partner is, and is perceived as, equivalent can be a

substantial challenge. Real or apparent imbalances in

the commitment of each partner can undermine the

trust and respect necessary for a healthy working

relationship. The GI change to a budgeted regional

focus should reduce the relative significance of the less

easily quantified forms of equity.

External factors beyond the partners’ control canaffect progressThe IMO Integrated Technical Co-operation Programme

(ITCP), under which GI activities are coordinated, aims

at assisting countries in building up their human and

institutional capacities for uniform and effective

implementation of IMO’s regulatory framework. Some

of the Programme elements may be subject to re-

shaping or reforms due to insufficient funding or a shift

in priorities internally, which can also affect the

partnership programme of activities. On the

government side the assignment of resources—

particularly limited in developing countries—may not


THEME: Oil spill response

PARTNERS: IGO • O&G

LEVEL: global

LOCATION: global

The IMO/IPIECAworkshop in Angolabrought together delegatesfrom government andindustry in 22 countriesparty to the Conventionfor Co-operation in theProtection andDevelopment of theMarine and CoastalEnvironment of the Westand Central AfricanRegion (WACAF orAbidjan Convention).

An oil spill responseteam makes readytheir equipment afterbeing called out toan equipmentdeployment exercise.


88

align well (or at all) with the requirements of the

partnership. Equally, on the industry side, the

availability of staff can change at short notice, for

example if they are called to respond to an oil spill

incident. These external factors can cause frustration

for the partners. The GI has addressed the issue in part

by erring on the side of caution in planning events and

activities, but the partners acknowledge the need for,

and have engaged into, improved organizational and

timetabling aspects within these external constraints.

The scope of each partner’s interest is likely todevelop over time Interests may diverge somewhat, with one partner

wishing to push progress on a specific topic or in a

particular region, while other partners have less

interest in, or reasons for, doing so. In the case of the

GI, a ‘collective’ of industry groups is required to

effectively address the broad range of activities that

IMO wishes to pursue; where one industry group has

little interest or expertise, another must take the lead.

Inherent differences in institutional culture requiremutual understanding from the partnersCross-sector partnerships, by their nature, bring

together organizations with different structures,

mandates and operational capabilities. This is the case

for IMO and IPIECA. Under these circumstances working

together can require adjustments and reciprocal

understanding to achieve the effective implementation

of a joint programme of activities. Partners need to

integrate their strengths and be realistic about their

differences to avoid frustration. This has been the

approach followed by the GI partners.

Managing knowledge and information can reducethe impacts of staff changesStaff turnover and staff availability have been issues for

both the IMO and IPIECA. Staff change requires lessons

to be relearned and working relationships to be

developed again. Staff shortages or reduced staff

availability can also deter the rate of progress and the

vibrancy of the working relationship. Even if staff

turnover is expected to be low, a formal process of

capturing and managing knowledge from the outset is

essential. In the case of the GI, the production of case

study materials, country-by-country assessments and a

formal process for documenting outcomes have helped

to manage knowledge and information, and to reduce

the impacts of staff changes and shortages.

Sustaining interest in the issue that thepartnership is addressing can be a challengeThe financial resources available from industry have

been constrained by a failure to internally

communicate ongoing risk to those assigning

corporate budgets. The implementation of best

practice and early successes in reducing spills has

resulted in oil spills being regarded as a ‘mature’ and

effectively-managed issue at the company level, in turn

weakening business unit support for external, industry

wide actions. Ongoing communication to corporate

staff on the potential negative business and

environmental impacts of oil spills is required to ensure

sustained financial support.

Conclusions

Clear progress has been witnessed in a number of areas

such as designation of Governmental Responsible

Authorities, development of national legislation and

ratification and effective implementation of relevant

IMO conventions by the recipient countries. However,

more efforts need to be made by partners to increase

the countries’ capacity in oil spill preparedness and

response, and to enhance national and regional

cooperation between government and industry. In this

respect, it is important to recognize that GI is a long-

term process and that the results attained so far in

some countries represent good examples which can be

replicated elsewhere. Looking to the future, it is hoped

that the regionalization of the programme will drive

progress more rapidly and deliver effective and

sustainable contingency plans in a reasonable time

frame, overcoming some of the obstacles of the past 10

years. In order that the changeover to a regional

approach does not result in a loss of strategic

perspective, it is likely that a core role for IMO and

IPIECA will be required.

For more information on the Global Initiative see the

IPIECA website at www.ipieca.org

Action on oil spills: the IMO/IPIECA Global Initiative(continued)

The deployment ofbooms is the focus ofthis equipmentdeployment exercise inthe Philippines.


PARTNERS: GOV • IGO • O&G

LEVEL: regional

LOCATION: Caribbean

89

Background

Clean Caribbean & Americas (CCA) is a non-profit

emergency oil spill response organization and an

international Tier 3 response centre covering the

Caribbean, and North, Central and South America. CCA

works extensively with a number of international

organizations, as well as national coast guards,

environmental ministries and local authorities.

A Tier 3 response operation entails crossing

international borders with equipment and personnel. It

requires coordination of strategic decision making,

logistics, and customs and immigration formalities.

Ideally, these mechanisms exist in a National

Contingency Plan and are exercised periodically.

One such exercise is the CCA International

Mobilization, Preparedness and Response Exercise

(MOBEX), which has been conducted every three years

since 1995. In January 2005, CCA conducted the fourth

and most ambitious MOBEX near the island of

Martinique, in the French Antilles, in conjunction with

the French government exercise of its National

Contingency Plan, POLMAR (POLlution MARitime), and

La Société Anonyme de la Raffinerie des Antilles, the

local refinery in Martinique.

MOBEX/POLMAR 2005

CCA and the Prefecture of Martinique signed a

Memorandum of Agreement for the MOBEX/POLMAR

exercise. The French government was the lead

authority, with CCA filling an integrated support role.

The joint exercise had three main goals:

■ To test the efficiency of the cooperation among

government agencies in Martinique and

international organizations.

■ To evaluate the capabilities of response teams and

equipment in an actual situation.

■ To raise government, industry, public and

international observers’ awareness of oil spill

response capabilities and limitations.

The theme of MOBEX/POLMAR 2005 was ‘Towards

Integrated & Scientific Preparedness & Response’. The

exercise had three phases:

1. The POLMAR command-and-control exercise under

the command of French authorities.

2. Equipment mobilization, deployment and training

under the leadership of CCA.

3. An oil spill response conference, attended by

approximately 100 observers from 20 countries.

The exercise differed from previous exercises in its

scope. A simulated spill of 150 cubic metres of oil from a

tanker off the south-east coast of Martinique required

an initial response and deployment of equipment by

the local fire brigade, with CCA support, to protect the

environmentally sensitive coastal mangrove areas and

the fisheries. During the exercise, POLMAR emergency

response plans and actions were tested, from the initial

notification and reporting of the oil spill, to response

actions to combat the spill and minimise environmental

damage and social and economic impact.

Lessons learned

MOBEX/POLMAR 2005 was an opportunity to address

all aspects of emergency response, including

administrative and logistical problems, issues in the

transport and clearance of equipment across

international borders, and the integration of CCA

resources into locally and nationally organized and

directed response operations.

All aspects of the response exercise were conducted

with the aim of reviewing and improving POLMAR and

CCA response capabilities. The exercise demonstrated

that CCA’s resources and technical expertise are

integrated into national and local systems of response.

The exercise also provided an operational model for how

CCA will support spill response operations in the 34

countries in its area of responsibility.

International observers left Martinique with a

better appreciation of the resources and actions

required for an effective oil spill response, as well as the

science and concepts to improve preparedness in their

own countries and companies.


Oil spill response exercise in Martinique

The coordinated efforts of the multiple

participants in the January 2005 MOBEX/

POLMAR exercise helped raise awareness and

improve capabilities for responding rapidly and

effectively to marine oil spills.

Key partners

Multiple local, nationaland internationalorganizations andagencies, including:

• Asociación Regionalde Empresas dePetróleo y Gas Naturalen Latinoamérica y elCaribe

• Clean Caribbean &Americas (CCA)

• French Navy (MarinaNationale)

• International MaritimeOrganization (IMO)

• International TankerOwners PollutionFederation (ITOPF)

• IPIECA

• Prefecture ofMartinique (LaPréfecture de laRégion Martinique)

• La Société Anonymede la Raffinerie desAntilles

• United NationsEnvironmentProgramme (UNEP)

Monsieur Le Prefet de laRegion Martinique aboardan observation vessel inFort de France harbour isinterviewed by local mediaabout the exercise.

KEYWORDS: international exercise; global initiative; awareness raising and capacity building


90

The National Oil Spill Control and Contingency Plan in Malaysia

PETRONAS and the Petroleum Industry of Malaysia Mutual Aid

Group have been working in partnership with Malaysia’s Department

of Environment on oil spill management and response capability since

the early 1990s.

Background

The Straits of Malacca is a strategic navigation channel

and one of the busiest waterways in the world.

Annually, approximately 63,600 ships pass through the

Straits from Europe and the Middle East to the Pacific

Ocean and Asia, carrying 30 per cent of the world’s

trade as well as 50 per cent of the world’s oil.

With such a volume of traffic, the likelihood of an

oil spill is a concern for the littoral states of Malaysia,

Singapore and Indonesia. Indeed, 75 shipping incidents

in the Straits were reported between 1975 and 1993,

with 54 of them resulting in oil spills. Malaysia alone

spent US$34 million to clean up 30 oil spills between

1984 and 1997, and this figure excludes compensation

for loss of income, equipment and stocks to affected

fishermen and aquaculture farmers.

The projected impacts of a large oil spill in the

Straits have prompted several national and regional

initiatives to establish oil spill response and

preparedness capabilities. It was in this spirit that

PETRONAS spearheaded the formation of the

Petroleum Industry of Malaysia Mutual Aid Group

(PIMMAG) in December 1993. Open to all companies

involved in upstream and downstream activities in

Malaysia, PIMMAG’s aims are to provide the capability

to manage, maintain and operate oil spill response

resources, and to complement government efforts in

the control and clean-up of oil spills. By virtue of its

status as the national oil company, PETRONAS has been

contributing to all activities under this cooperation.

The National Oil Spill Control andContingency Plan

The premier procedural reference in managing oil spill

incidence in Malaysia is the ‘National Oil Spill Control

and Contingency Plan’ published by the country’s

Department of Environment. Governance of this

national plan is the onus of the National Oil Spill

Control Committee (NOSCC), which comprises

government agencies such as the Department of

Environment, the Marine Department, Royal Navy

Malaysia, the Maritime Enforcement Coordination

Centre, Marine Police and the Fire Brigade

Department, as well as PETRONAS and PIMMAG.

The Nagasaki Spirit incident in the Straits of

Malacca in 1992, when the tanker collided with a

container ship and spilled 13,000 tonnes of crude oil,

revealed some weaknesses in the communications

and coordination arrangements in the national plan.

The Malaysian government decided a review was

necessary, and the task was given to the Department

of Environment. To ensure the review resulted in a

comprehensive and well-tested plan, the government

also sought input and expertise from PETRONAS and

PIMMAG.

It was envisaged that the review would equip

Malaysia with not only a comprehensive oil spill

contingency plan, but also a stockpile of oil spill

response equipment at strategic locations along the

Straits of Malacca and on the east coast of Peninsular

Malaysia, as well as Sabah and Sarawak.

Following the review of the national plan, a

three-tier approach was adopted to combat oil spills.

Local authorities and local oil companies handle

Tier 1 responses on site, and regional councils

administer Tier 2 responses involving larger areas. In

more serious cases, the NOSCC is responsible for

mobilizing and coordinating Tier 3 responses, which

include containment efforts on sea and remedial

measures on land.

Since its establishment in 1976, the National Oil

Spill Control and Contingency Plan has also been

tested and improved through a number of exercises.

Most recently, both PETRONAS and PIMMAG helped

prepare for and implement the national oil spill

exercises in 2000 and 2005.

National oil spill exercise in Kuantan, 2000

The 2000 national oil spill exercise was conducted in

Kuantan, Pahang, located on the east coat of

Peninsular Malaysia on the South China Sea. The

objectives of this exercise were to assess the

participants’ preparedness for the following:

Key partners

• Department ofEnvironment, Malaysia

• Petroleum Industry ofMalaysia Mutual AidGroup (PIMMAG)

• PETRONAS

KEYWORDS: oil spill training and exercises; national planning and international cooperation

91

■ Tier 1 oil spill response at Kuantan Port;

■ Tier 2 oil spill response at the Pahang State level; and

■ coastal clean-up of oil spills at the Pahang State level.

The exercise was a success in terms of

communication and coordination among various

agencies, and feedback and improvements were

incorporated in the national plan.

‘Oil Combat 2005’ exercise and lessonslearned

An exercise on oil spill response was held in the

southern waters of Malaysia in July 2005. The three-day

exercise, hosted by the Department of Environment in

partnership with PETRONAS and PIMMAG, was

attended by 300 officers from various government

agencies and private sector organizations. It was aimed

at testing the level of readiness and the effectiveness of

the ‘Standard Operating Procedure for Oil Spill Control

in the Straits of Melaka’ and the Malaysian National Oil

Spill Control and Contingency Plan. PETRONAS and

PIMMAG also lent support by furnishing the equipment

and trained personnel for the exercise.

The oil spill exercise was deemed as successful,

with a number of key factors identified during the

implementation of the oil spill contingency plan:

■ Effective emergency communication and working

relationships established prior to and during the oil

spill incident, which contributed significantly to

managing the incident efficiently.

■ Properly maintained and easily accessible PIMMAG

oil spill response equipment that was deployed on-

site, as well as the group’s highly trained oil spill

responders.

■ Excellent manpower and equipment support,

for example trucks, boats, beach clean-up vehicles

and heavy machinery, from government agencies

such as the Fire Brigade and the Marine and

Fisheries departments.

Conclusion

In a critical situation such as an oil spill, early and

coordinated intervention measures will prevent oil

slicks from encroaching on larger areas. The 2000 and

2005 exercises clearly demonstrate that the success of

the National Oil Spill Control and Contingency Plan is

primarily dependent on a strong partnership,

established communication and clear understanding

among government authorities and private sector

organizations.




LEVEL: regional


Oil Combat Exercise,2005


92

The Extractive Industries Transparency Initiative

Proposed by UK Prime Minister Tony Blair in 2002 and endorsed

by the G8 countries, the multi-stakeholder Extractive Industries

Transparency Initiative supports improved governance in resource-rich

countries through publication and verification of company payments

and government revenues from oil, gas and mining.

Background

In 2002, the UK government launched the Extractive

Industries Transparency Initiative (EITI) at the World

Summit on Sustainable Development in Johannesburg.

It was motivated by issues of energy security—the

realization that growing amounts of hydrocarbons

would be reaching the UK from ‘new’ areas such as West

Africa and the Caspian region—as well as by NGOs’

efforts to highlight the specific issue of revenue

management in resource-rich emerging societies.

Subsequently, delegates from multiple countries,

companies, associations and organizations at a

founding conference in London in June 2003 agreed a

‘Statement of Principles and Agreed Actions’, and

endorsed the voluntary nature of the initiative. The 12

EITI principles provide the cornerstone of the initiative.

They affirm that natural resources management is the

domain of sovereign governments, that resource

extraction benefits accrue over many years and are

often price-dependent, that the achievement of greater

transparency must respect laws and contracts, and that

a broadly consistent and workable approach to the

disclosure of payments and revenues is required.

Delegates at a second conference in March 2005

agreed on criteria, guidelines and a sourcebook for

implementing countries and participating companies,

and authorized the establishment of an EITI Secretariat,

now based in the UK Department for International

Development (DFID).

At the start of 2006, EITI remained in a ‘pilot phase’.

An International Advisory Group (IAG), set up

following the 2005 conference, is discussing the

initiative’s future. Led by Peter Eigen, chairman of

Transparency International, the IAG will recommend to

the next EITI international conference (scheduled for

late 2006) how to monitor and validate the EITI

process and reward nations and companies that fully

implement the initiative.


So far, EITI has proved successful to a degree that has

surprised many participants. Underlying differences

between the various parties have been finessed,

agreement has been reached on some sensitive core

issues, new countries are being encouraged to take

part and a majority of independent oil, gas and mining

companies are included.

Much of this success is down to four factors. First, EITI

is voluntary. It is unlikely that it would have progressed

this far on any other basis. Second, it’s focus is

narrow—all it does is require companies and states to

report what money is paid to host governments. Third,

it is driven by resource-rich countries rather than by the

UK government, or companies or NGOs. Fourth, it is

flexible—no two countries are the same and their

motives for participating differ, yet the EITI guidelines

encompass incentives to meet these varying motivations.

Several key oil-producing countries led by

Azerbaijan and Nigeria are already making serious

efforts to comply with the EITI criteria. In Azerbaijan, a

commission was set up to implement the initiative, and

the country’s first EITI report was published in March

2005. (For more information on the Azerbaijan work,

see the BP-EITI case study on page 94.) In Nigeria, EITI

has been the catalyst for a comprehensive effort

backed by the president to ‘break the blame cycle’

Key partners1

Multiple countries,companies, associationsand organizations,including the following:

Countries (activeimplementers or endorsers):

• Azerbaijan• Nigeria• Peru• Trinidad & Tobago

Countries (donors):

• France• Holland• UK• USA

Oil and gas companies:

•BP • Chevron• Eni• ExxonMobil• Hess • Marathon • Repsol • Shell • Statoil • Talisman Energy • Total • Woodside

Industry associations:

• American PetroleumInstitute

• InternationalAssociation of Oil &Gas Producers

NGOs:

• Catholic Agency forOverseas Development

• Global Witness • Publish What You Pay

coalition • Transparency

International

KEYWORDS: revenue management; reporting and validation; voluntary initiative

1 For a full list of participants in EITI, see www.eitransparency.org

93

around the oil industry. All official receipts from oil and

gas developments going back five years are being

audited, a value-for-money process review is under

way inside government and a lively nationwide

communications exercise has been launched to explain

what is happening.

The various parties to EITI are learning some distinct

lessons. On the company side, participants have been

pleasantly surprised by the extent to which their

concerns, especially about commercial confidentiality,

have been heard and acted on. ‘We’re realizing that these

tripartite initiatives can work provided you focus on what

you agree on. Then you can move an initiative forward. If

you focus on the differences, all you do is argue,’ observes

one oil industry executive involved in EITI.

Differences do exist among companies, most

importantly about whether disclosure of tax and

revenue payments to governments should be on a

disaggregated (individual company) basis or

aggregated (collective) basis.

Although NGOs were committed initially to

mandatory EITI reporting requirements and ‘quite

aggressive and clear transparency goals’, they decided

early on to stay involved despite the voluntary nature of

the initiative. Two years down the line, EITI is seen as a

useful tool in empowering local societies, protecting

human rights and advancing democratic accountability.

Both companies and NGO participants comment

favourably on the role played by DFID and, more

recently, the EITI Secretariat. In particular, a sharp

increase in expertise and personnel since 2003 wins

wide praise. For its part, the Secretariat increasingly sees

its role as a ‘matchmaker’, putting countries, companies

or NGOs in touch with the right people, and as a

‘knowledge bank’, sharing information and stimulating

better governance, in particular before big money

comes in from large hydrocarbon and mining projects

and makes altering the status quo more difficult.

Conclusions

Remaining issues include the sincerity and capacity of

some countries wanting to sign up to the initiative; the

future structure and funding of the EITI Secretariat; the

participation of state-owned companies in such places

as Russia, China, Brazil, India and Malaysia; the

minimum levels of monitoring and validation needed

to ensure the initiative’s continued credibility; its

geographic spread; and the implications of the large

revenue increases being experienced in many oil- and

gas-rich states.

Against that, experience has taught those involved

with EITI not to expect linear progression. Less than

four years after the launch of the initiative there is wide

acceptance that knowing what governments receive,

verified by what companies pay, is a critical first step to

holding decision makers accountable for the use of

those revenues. In this sense, EITI has already justified

itself as part of a wider drive for better governance that

may in time ensure that revenues from hydrocarbon

and mineral projects contribute more directly to

poverty reduction and development.

For more information on EITI activities, visit

www.eitransparency.org


endorsing countries

implementing countries

THEME: Transparency


LEVEL: global

LOCATION: global

SIGN UP• Government makes public statement

• Stakeholders identified—government, civil society, all extractive companies• Initiating conference held

SET UP• Multi-stakeholder committee formed

• Basic procedure for EITI agreed and workplan developed

PROCESS DEVELOPMENT• Technical assistance needs identified and secure financing and support found

• Select independent administrator to reconcile figures tointernational audit standards

DISCLOSURE AND PUBLICATION• Design reporting template

• Companies and government submit data to administrator• Ensure data is to international standards

PUBLIC DISSEMINATION AND DISCUSSION• EITI Report published, identifying any discrepancies

• Administrator makes recommendations to improve process• Stakeholders review data

REVIEW• Review process and make improvements

• Workplan reviewed• Regular reporting continues

The ‘EITI Process’


94

Revenue transparencyin Azerbaijan

BP has been involved with the Extractive Industries Transparency

Initiative since its launch in Johannesburg in 2002, mostly in

Azerbaijan and also in Angola, and Trinidad and Tobago.

Background

In 1997, BP sponsored a social impact assessment in

Angola—the first ever undertaken on its behalf. The

assessment indicated that a key issue for BP was the

host government’s use of revenues received from the

company’s oil exploration and development activities

in the country. As BP expanded its operations in

Azerbaijan and the Caucasus region, revenue

transparency was again highlighted as an issue with

implications for the company’s reputation.

As oil prices recovered from a low of $10 a barrel in

1998 to rise above $50 a barrel in 2005, the issue of

revenue transparency attracted wider interest. An

investigation by Oxfam America and the launch in 2002

of a ‘Publish What You Pay’ campaign by the Open

Society Institute and a coalition of NGOs gave the topic

worldwide prominence. For its part, BP calculated that

over the next 30–40 years the government of

Azerbaijan might receive revenues of $40–187 billion,

dependent primarily on the price of oil. Angola—as

well as Indonesia and Trinidad and Tobago (other

countries in which BP is building a commercial

presence)—could achieve similar revenues.

From the outset BP has not regarded the Extractive

Industries Transparency Initiative (EITI) as a panacea.

Any transparency that EITI achieves ‘is a means to the

end—and not the end in itself’ in the words of Richard

Paniguian, BP’s group vice president for Africa, Middle

East, Russia and the Caspian Region. In BP’s view,

achieving the core purpose of transparency—

promotion of better governance, less corruption, fewer

conflicts and reduced poverty—ultimately depends on

the capacity of host country governments. No

company, however large, can achieve much by itself.

But BP also accepts that there are valuable things

companies can do in this area by working in

partnership with others.

BP is one of two energy companies (Chevron is the

other) who represent the wider oil and gas industry’s

views in the EITI’s International Advisory Group (IAG).

The IAG is to make recommendations at the 2006 EITI

international summit in Oslo on how to validate

implementation of EITI and how to organize the

initiative in future.

The Azerbaijan experience

Following BP’s commitment to support EITI, and the

endorsement of EITI principles by the government of

Azerbaijan and the country’s Oil Fund in November

2004, a commission was set up to implement EITI in

Azerbaijan. BP, along with 21 other foreign oil

companies in the country and a coalition of 32 local

NGOs, took part in this effort and played a lead

organizational role among the companies.

Subsequently, an aggregator was appointed to

audit the host government’s annual report of revenues

received from foreign oil companies and the

companies’ individual reports of revenues paid to the

Key partners

• BP Azerbaijan, BPAngola, BP Trinidad& Tobago

• Other members ofconsortia and jointventures partneringBP in these countries

• Governments ofAzerbaijan andTrinidad & Tobago(EITI implementers)and Angola (EITIendorser)

• Department forInternationalDevelopment, UKgovernment

KEYWORDS: revenue management and transparency; consensus decision making; EITI

Welders at work onpipeline installationat SangachalTerminal,Azerbaijan

A platform topsides under construction at an offshore oildevelopment in the Caspian Sea

95

government. The aggregator compares the totals,

checks for obvious errors and publishes the reports.

Azerbaijan’s first EITI report was published in March

2005. At present, BP is one of two international

companies represented in Azerbaijan (Statoil of

Norway is the other) to publish individual data (in its

Azerbaijan Sustainability Report 2004 available on the

bp.com website).


David Woodward, associate president of BP, welcomed

the publication of the reports for Azerbaijan in 2005 as

a world first. BP, he said, was satisfied with the

aggregator’s independent process while recognizing

there are ways the EITI process could be improved. In

particular, BP has sought individual tax and revenue

disclosure from other foreign companies associated

with it in various consortia in Azerbaijan, including the

Azerbaijan International Operating Company and the

Baku-Tbilisi-Ceyhan Company. Itochu of Japan has

indicated its willingness to follow BP and Statoil’s lead.

An advance especially welcomed by BP has been

the Azerbaijan president’s decision to give government

signing authority for EITI agreements to the head of the

country’s Oil Fund. This move not only enhanced the

Oil Fund’s authority within the governing structure, but

also made it easier for oil company-government

negotiations to move ahead.

Azerbaijani authorities, including the president of

the state oil company SOCAR and the head of the Oil

Fund, have hailed publication of the EITI reports in

2005 as evidence of the authorities’ commitment to

transparent management of revenues accruing from

the extractive sector. Local NGOs have hailed the

publication of the report as ‘a significant step forward.’

Nevertheless, in important ways the EITI remains

work-in-progress:

■ It stands outside oil companies’ licence agreements

with host governments and can be revoked at any

time. One suggestion is to incorporate EITI provisions

in project lending terms, so allowing financing to

be withheld if EITI commitments are not met.

■ Validation of the initiative—devising an

independent process to ensure countries and

companies are proceeding with implementation

consistent with the EITI principles and agreed

criteria—is still under discussion in the IAG.

■ Protection of the EITI ‘brand’ to stop countries and

companies falsely claiming to be endorsing or

implementing the initiative, is a key issue being

addressed by the IAG.

■ A new administrative structure will be necessary

once the UK’s sponsoring agency, the Department

for International Development, relinquishes its

central role. Again, the IAG is developing options.

■ Revenue management in Azerbaijan remains an

issue and the country continues to feature

prominently on Transparency International’s

Corruption Perception Index.

■ A majority of oil and gas companies operating in

Azerbaijan are opposed to individual company tax

payment and revenue disclosure. Most prefer to

report collectively.

Conclusions

EITI would never have started except on a voluntary

basis. Within this limitation it has achieved much in the

three years since its inception, particularly in

Azerbaijan and Nigeria (where BP is not represented).

BP has particularly welcomed the development of

minimum criteria for EITI implementation and the way

the initiative has mobilized and legitimized the role of

civil society in a sensitive area for governments.

A strong sense exists, however, that the real test of

EITI lies ahead both in Azerbaijan when oil revenues

soar in 2006 and beyond, and further afield as more

countries sign up.


THEME: Transparency


LEVEL: global national

LOCATION: Caspian

Installing offshore platforms at the giant Azeri-Chirag-Gunashli offshore complex in the Caspian

An oilfield supplyvessel at work in theCaspian Sea

A guide to resources

Further reading

■ The oil and gas industry—technology cooperation

and capacity building, contributing to Agenda 21.

IPIECA/UNEP, 1994.

■ The oil and gas industry: from Rio to Johannesburg

and beyond. OGP/IPIECA ‘WSSD report’, 2002.

■ The Partnering Toolbook. (Available in more than

15 languages.) The International Business Leaders

Forum (IBLF) and the Global Alliance for Improved

Nutrition (GAIN), 2003.

■ Partnership briefing paper.

IPIECA, 2004.

■ The Case Study Toolbook.

Published in 2006 by IBLF on behalf of

The Partnering Initiative.

For more resources on cross-sector partnering

please see www.ThePartneringInitiative.org

Acknowledgement

This publication is the work product of the IPIECA

Partnership Task Force. The Task Force was convened under

the auspices of the IPIECA Strategic Issues Assessment

Forum. Case studies were provided by IPIECA company and

association members. Eva Halper from the Partnering

Initiative (a collaborative venture between the Prince of

Wales Business Leaders Forum (IBLF) and the University of

Cambridge Programme for Industry), provided invaluable

insight and expertise; Michael Warner, Programme Director

at the Overseas Development Institute, brought his

knowledge of partnerships and the oil and gas industry.

Partnership Task Force members included:

Garry Mann (Nexen)

Helen Sullivan, Chair (Shell)

Dominique Chauvin (Total)

Karen Tyrone (ExxonMobil)

Eva Halper (The Partnering Initiative)

Sophie Depraz / Hannah Buckley (IPIECA)

The case studies were edited by Sue McManus.


97

Please also visit the IPIECA Partnership Portal

The partnership portal can be accessed via the IPIECAwebsite at www.ipieca.org, and includes furtherresources on multi-stakeholder partnerships in addition toeach individual case study featured in this publication.

A search function enables users to search case studies viathemes, keywords, region, partner or company involved.


Company members

BHP Billiton Ltd

BG Group

BP

Chevron

CNOOC

ConocoPhillips

ENI SpA

ExxonMobil

Hess Corporation

Hunt Oil Company

Hydro

Kuwait Petroleum Corporation

Mærsk Olie og Gas

Marathon Oil

Nexen Inc

NOC Libya

Petroleum Development Oman

Petronas

Petrotrin

PTTEP

Repsol YPF

Saudi Aramco

Shell International Ltd

Statoil

TNK-BP

Total

Woodside Energy Ltd

Association members

AIP (Australian Institute of Petroleum)

API (American Petroleum Institute)

ARPEL (Regional Association of Oil & Natural Gas

Companies in Latin America and the Caribbean)

CAPP (Canadian Association of Petroleum Producers)

CPPI (Canadian Petroleum Products Institute)

CONCAWE (Oil Companies European Association for

Environment, Health and Safety)

EUROPIA (European Petroleum Industry Association)

IFP (Institut Français du Pétrol)

OGP (International Association of Oil and Gas

Producers)

PAJ (Petroleum Association of Japan)

SAPIA (South African Petroleum Industry Association)

WPC (World Petroleum Congress)

98

The International Petroleum Industry Environmental Conservation Association (IPIECA) is comprised

of oil and gas companies and associations from around the world. Founded in 1974 following the

establishment of the United Nations Environment Programme (UNEP), IPIECA provides one of the

industry’s principal channels of communication with the United Nations. IPIECA is the single global

association representing both the upstream and downstream oil and gas industry on key global

environmental and social issues including: oil spill preparedness and response; global climate

change; health; fuel quality; biodiversity; social responsibility and sustainability reporting.

5th Floor, 209–215 Blackfriars Road, London, SE1 8NL, United Kingdom

Telephone: +44 (0)20 7633 2388 Facsimile: +44 (0)20 7633 2389

E-mail: [email protected] Internet: www.ipieca.org

Please also visit the IPIECA Partnership Portal

The partnership portal can be accessed via the IPIECAwebsite at www.ipieca.org, and includes furtherresources on multi-stakeholder partnerships in addition toeach individual case study featured in this publication.

A search function enables users to search case studies viathemes, keywords, region, partner or company involved.

www.ipieca.org

Partnerships in the Oil and Gas Industry - IPIECA

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