In Indonesia in 1924, we took our first significant step in exploration and production in Asia. So, too, began our journey of shared progress in the region.
In Indonesia, two simple words, gotong royong, convey the complex idea of cooperation, of offering assistance, sharing burdens and working with others. For decades, we have embraced gotong royong, working with Indonesians to strengthen economic opportunities that benefit operations and local communities.
"Helping improve social and economic conditions beyond our operations promotes a better standard of living and expands our ability to conduct business," said Steve Green, managing director of Chevron's IndoAsia operations in 2010. "In addition to providing opportunities to businesses that supply our operations, we help support a diversity of ventures, such as agriculture, fisheries and homebased businesses."
Chevron's operations range from crude oil and natural gas to geothermal projects in West Java. Our Salak and Darajat projects, together with our geothermal projects in the Philippines, make us the world's largest producer of geothermal energy, a renewable resource that turns the earth's steam to electricity while producing almost no greenhouse gas emissions.
Supporting Local Businesses
Our investments in Indonesia create a diversity of jobs. About 97 percent of our employees and managers are Indonesian nationals, while many other nationals are employed by our local suppliers. These businesses play an important role in providing the services and supplies we need to operate.
Through education, training and funding, we work with businesspeople such as Erinawati, a maintenance contractor in Minas who wanted to become part of our supply chain. She said, "At first I knew nothing about projects like this. Then I attended a workshop organized by Chevron. We were shown how to prepare proposals and bids."
Erinawati learned that to work with Chevron, businesses must meet certain standards of production, technology and safety. She earned a Chevron Local Business Development (LBD) certificate, qualifying her to bid on contracts for fence painting and drainage. "I'm now able to empower not only myself but also the many people on my team—my neighbors and young people from around here," Erinawati said.
The LBD program has helped more than 4,600 small companies and cooperatives in Riau, East Kalimantan and West Java. Workshops provide training in health and safety, environmental management, procurement, business ethics, project management, technology and financial management. LBD participants grew their businesses from $1.3 million in 2001 to more than $123 million in 2010.
Since LBD began, more than 815 small suppliers have been certified, 3,600 contracts have been awarded and 7,200 jobs have been created. In all, we have purchased $52 million in local goods and services. The Indonesian Ministry of Energy and Mineral Resources recognized the success of the program with its Padma Community Development Award, the second time Chevron has received this award.
Microfinancing Grows Businesses
Microfinancing provides Indonesians with business opportunities. The programs we support, through the delivery of low-cost loans, reach a variety of enterprises outside of our operations.
"Microfinancing is about enabling people to build businesses and employ others, resulting in stronger communities," said Ted Etchison, Chevron senior vice president for operations in Kalimantan. "Microfinance is not charity. It's about building capability and empowerment, and it places the responsibility for success on the participants. We help plant the seed. The people then develop their own livelihoods."
In East Kalimantan and West Java, we partnered with government-owned financial institutions Permodalan Nasional Madani and Baitulmaal Muamalat to form the Community Enterprise Development program, offering access to low-cost loans and management training to communitybased business groups and small businesses.
"Before [microfinancing], it was difficult just to keep my small business running, but now I can make a tidy profit," said Wistiningsih, a vegetable seller at Petukan Market in Balikpapan. "The money we earn every day can be used as capital to buy vegetables to sell. Thanks to the help we've received, my children have been able to go to school."
In Salak and Darajat, home to our geothermal operations, we helped establish farmers' networks, where farmers turn idle land into fields of abundant crops. We provide training, and the farmers support and share knowledge with each other. In Pasirwangi, Garut Regency, we initiated the pioneering, mosque-based Muamalat Community Micro Enterprise program. Currently, four mosques participate, providing entrepreneurs with low-cost loans.
Promoting Entrepreneurship
We are committed to helping create sustainable livelihoods and self-sufficiency. Those livelihoods come in many forms.
In Dumai, known for its exquisite Malay textiles, we support a program to preserve the traditional art of weaving. We provided training, hand looms, and the construction of a center and gallery.
In Garut Regency, we support goat breeding; farmers earn money not only by selling goats but by selling goat manure as fertilizer to organic farmers.
In our efforts to preserve the Mount Halimun Salak National Park, we and our community partners helped launch ventures such as organic gardening and rabbit breeding to help people develop more sustainable livelihoods. Traders and craftspeople, for example, are encouraged to switch from making furniture from park timber to cultivating vegetables and fruits.
Each day in Indonesia, we embrace gotong royong—a chance for business and communities to work together and thrive.
Updated: May 2011