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Health, Safety, the Environment and Corporate Values: Partners in Progress, Making Hope Happen

By Warner Williams, Vice President of Health, Environment and Safety
ChevronTexaco Corporation

Sixth Society of Petroleum Engineers Conference on Health, Safety and the Environment in Oil and Gas Exploration and Production

Kuala Lumpur, Malaysia

Thank you, fellow petroleum engineers and distinguished guests. I would like to thank Petronas, our hosts and sponsors for this important conference in Malaysia.

Most of us from industry know how significant this entire region is to our business portfolio. But this region contains some of the world's richest environmental treasures – the Earth's most ancient rain forests and its largest flower, for example.

In my many visits here, I have been deeply impressed by Malaysia's natural gifts and by the efforts to preserve those gifts.

It has been said that a goal is simply hope with a deadline. So as we discuss our subject at this conference, let us do so knowing that the clock is ticking, knowing how tightly health, safety and the environment are bound to the hopes we all share for human progress – because we are not talking about hope in the abstract; we are talking about hope as the fuel of life.

... health, safety and the environment are bound to the hopes we all share for human progress.

As a 19th-century writer put it, "A dreamer lives forever ... a toiler dies in a day." Right now, our industry is facing a world full of dreamers and hopers; they are counting on us to deliver, and the need is urgent.

I have been fortunate in my career to work in the developing world. Over the last 28 years, I have worked in 15 different developing countries in Africa and Asia. It was a fascinating period for me, most of all because of the people I have met and the lasting relationships formed – the energy, creativity and dedication of people joining together to accomplish a common goal – a consistent theme.

In fact, when I think of hope, I think of a young Indonesian named simply Watermis. Along with other villagers in Central Sumatra, Watermis had to move his family and farm to make way for a government dam.

Watermis and some 239 villagers from his province were sponsored to study at a special agricultural center. After an intensive course in agribusiness, Watermis went back to his farm. Within a year, his income had tripled, and he was planning to expand his crops.

Watermis told an interviewer that Caltex – which is part of ChevronTexaco – has indirectly shared money with him and the other villagers by giving them useful knowledge to achieve their potential.

Bringing tangibility to hope .... is not only the right thing to do, it is the smart business thing to do.

For me, the Watermis' experience offers a glimpse of corporate social responsibility in action – one that makes me especially proud. But I must confess to you: I do not call it "corporate social responsibility." I call it "making hope happen." And I contend that bringing tangibility to hope – giving people the chance to make their dreams come true – is not only the right thing to do, it is the smart business thing to do.

We in industry still face enormous challenges, but one of the best yardsticks to measure whether we are, in fact, behaving in ways that help make hope a reality is to look at our performance in health, safety and the environment (HSE).

HSE does not cover all the ground of social responsibility. But today, because of how our disciplines of health, safety and the environment are evolving, there is a growing interplay between HSE and corporate values. It directly connects the hopes of a Watermis – and the kind of life his family will lead – to the kind of community in which they will lead those lives.

In our industry, as practical business people, we often see HSE as a gauge of efficiency. At my company we call it "Operational Excellence," which we define as safe, reliable, efficient and environmentally sound operations.

We see operational excellence as the key to world-class performance in safety, environment, health, reliability and efficiency. At ChevronTexaco, we are aggressively implementing its principles. Later, I will talk more about this effort.

As an industry, we have learned – painfully – that operational excellence can only be achieved if you work safely, reliably, efficiently and by respecting the environment.

... operational excellence can only be achieved if you work safely, reliably, efficiently and by respecting the environment.

In fact, I would say that in the 21st century how a company operates is one of the most telling indicators of its level of social responsibility or its license to operate.

My point is that health, safety and the environment no longer exist as merely regulatory data points in a vacuum. They weave us into tighter community partnerships wherever we operate. They proclaim whether we are good at what we do. They supply baseline metrics to a world hungry for a better life.

Now we all know our industry is far from perfect and that it faces daunting challenges. These challenges come at a time of unprecedented growth in energy demand, population, globalization and technology.

By 2010, the world will consume 90 million barrels of oil each day. Even now, about 11,000 newborn citizens appear on our planet every hour.

Today, incidentally, 2 billion of the Earth's residents, mostly in South Asia and sub-Saharan Africa, grow up energy-poor – they spend up to 10 times as much of their earnings on energy as richer countries. Such growth and such disparity naturally trigger rising expectations in the developing world.

Our industry has responded by embracing sustainability: the idea that we must ensure that the benefits of our presence are sustained and that, besides creating current wealth, we are true partners in building the lasting capacity of each community to help itself make real its own hopes.

... we are true partners in building the lasting capacity of each community to help itself make real its own hopes.

Last year, in an outgrowth of our long-standing relationship with the World Wildlife Fund, ChevronTexaco created a permanent foundation with its own local staff and facilities in Papua New Guinea. Its purpose: to continue our community and environmental programs there even after we are gone.

We think this marks the first time a major environmental group has helped an oil company create a foundation for sustainable development. Besides conventional steps to protect the environment, our progressive alliance with the World Wildlife Fund created a dozen major biodiversity surveys; it also raised community environmental awareness and helped residents establish sustainable local businesses.

Our Papua New Guinea (PNG) project won the Institute of Petroleum's environment award last year. What makes me even prouder is that when a Pulitzer-Prize-winning environmentalist visited, he found PNG's most endangered wildlife more abundant inside our facilities than outside.

I am sure other industry members here today have equally impressive examples in your own companies.

The point is how much our practice of health, safety and the environment has changed and how it has been extended into partnerships with the communities around us and become part of our day-to-day process in application and management.

A famous comedian used to say that his first act each morning was to read the obituaries. Upon not seeing his name, he shaved.

All too often in the past that is how we have treated HSE. Absent a crisis, we went about business as usual – we shaved. But the world of HSE is very different now.

Take safety.

No sharper contrast exists between past and present than at Kazakhstan's giant Tengiz Field. When my company became operators in 1993, thousands of workers actually slept in the field, which was known for its high concentrations of hydrogen sulfides. Our offices were housed within the perimeter of the hydrogen sulfide plants. Driver training and licensing were virtually non-existent.

It has taken several years, but we have managed to establish a safety management system at Tengiz. We have gone from punishment to positive reinforcement. Safety has become part of our value system. Today, safety ranks No. 1 on the agenda of every employee meeting.

In Tengiz now, our workers live in company housing. And anybody who drives for us is trained and licensed. We still have a long way to go, especially in contractor safety, but we are making headway. Last year, our Tengiz employees completed 17 million work hours without a lost-workday incident.

Now, when it comes to health, we all recognize that you cannot have a healthy work force without a healthy community. So our health initiatives have broadened beyond our own boundaries and our own workers.

... you cannot have a healthy work force without a healthy community.

ChevronTexaco's health clinics in developing nations around the globe are open and serve our employees, their families and, in some cases, community members.

  • We have helped screen thousands of Kazakhs for tuberculosis.
  • We have provided AIDS education for African communities.
  • We have sponsored programs on two continents to reduce infant mortality.

Other companies are doing their share. For example, in South Africa, BP sponsors "Soul City"-- a soap opera with a difference. "Soul City" tackles some of the nation's most pressing social and health issues with AIDS awareness as a leading story line.

Can we do more? Yes. Will we? Yes.

In Nigeria, we launched a program to bring health care to remote river villages. We call it the "river boat clinic." ChevronTexaco provides the boat and medical supplies, and our partners – the Delta State government – provide doctors and nurses. Currently, the riverboat clinic treats some 700 patients a week.

And now to the environment.

Here, especially during the 1990s, we have seen some of the biggest shifts. Before, we focused on compliance and regulations. We still do those things, but now we focus on partnerships, climate change and responsiveness.

In the process, we are not only altering the way we do business, we are reshaping our portfolios to reflect the needs of a very different energy future. At ChevronTexaco:

  • We are implementing a strong climate-change program.
  • We are collecting greenhouse gas emissions enterprisewide.
  • We are constructing zero-flare deepwater installations offshore West Africa.
  • We have joined eight other companies in studying the capture and storing of carbon dioxide emissions in geologic formations.

... we are not only altering the way we do business, we are reshaping our portfolios to reflect the needs of a very different energy future.

In fact, we are forming partnerships for everything from hydrogen fuel cells to solar roofing materials to high-density batteries for electric cars and trucks. And, we are using coal with our own gasification technology to produce clean electricity.

  • We with Sasol Ltd. are building gas-to-liquids processing facilities to make ultra-clean diesel fuels in West Africa. The first plant will prevent the flaring of 300 million cubic feet of natural gas per day.
  • We are converting the rumbling fury of a volcano into kilowatts on Indonesia's island of Java.
  • In partnership with BP, we will soon be spinning power from windmills in the Netherlands.

Notice how many times you heard the words "partner" and "partnership."

The Eskimos have 52 words for the word snow – it is that important to them.

In English, we only have nine or 10 words for "partner," but I am betting the list will grow.

In Malaysia, incidentally, the word for partner is "Rakan Kongsi," and the concept of partnership is so important that it is a formal government priority.

This leads us to the biggest change in HSE: the willingness of our supercompetitive industry to seek help in the form of partners – with governments, communities, non-governmental organizations, universities and even with ourselves.

It has been said that when we seek partners in life and business, we look through the prism of our own need. That is certainly true of my company – we knew that on our own, we couldn't accomplish the things we wanted.

Partnership lies at the heart of ChevronTexaco's success in Papua New Guinea and elsewhere.

Partnership lies at the heart of ChevronTexaco's success in Papua New Guinea and elsewhere.

  • In Indonesia, Caltex formed an alliance with the Indonesia Agricultural Institute to help farmers like Watermis.
  • In Kazakhstan, we partnered with the United Nations, the European Bank for Reconstruction and Development, and the U.S. government to help small and medium-sized businesses.
  • In Brazil, we joined hands with the Nature Conservancy to protect some 2,500 acres of Atlantic rain forest.
  • In Nigeria, we are working with 20 communities to provide electricity to 100,000 residents who previously had no electricity.

And we are not the only ones. Saudi Aramco is working with non-governmental organizations to rebuild mangroves on the shores of the Arabian Gulf.

ExxonMobil and Shell are partnering to improve driver safety in nearly a dozen African nations.

Statoil, with the Norwegian Refugee Council, is supporting educational efforts among Azerbaijan's large population of refugees.

And, here in Malaysia, Petronas has led mutual aid efforts to combat oil spills. And several companies – mine included – are working on the Energy and Biodiversity Initiative with members of the international environmental community.

Our industry's associations are also doing their part. The International Petroleum Industry Environmental Conservation Association (IPIECA) and the American Petroleum Institute are collaborating on a new reporting initiative for health, safety and the environment.

In January at the IPIECA board meeting in Paris, we discussed the need to be less competitive around health, safety and environment issues.

In Colorado earlier this month, at the American Petroleum Institute's Health, Environment and Safety General Committee Meeting, I was very pleased that the discussion turned to how we as an industry can collaborate more to ensure that we are operating with excellence in the area of Health, Environment and Safety.

The International Association of Oil and Gas Producers (OGP) and IPIECA are helping companies identify the social impacts that come with oil and gas projects. Indeed, some predict that a few years from now, social impact assessments will be as common as environmental impact statements are today.

Do not get me wrong. As I said earlier, our industry still needs to do better. The global oil and gas industry has a huge economic impact.

World Bank figures, for example, show billions of dollars of petroleum revenues in developing countries. Such vast sums hold enormous potential for good but equal potential for abuse.

Some critics even suggest that our presence does more harm than good.

Many countries where we operate still suffer from human rights violations, widespread corruption and energy poverty.

The sustainability of community benefits, the transparency of revenues, and the inherent volatility of commodity industries all remain issues that will challenge us in the years ahead.

We cannot do it alone. But the good news is that our industry is trying to address these issues, and we are making progress.

We can be a catalyst for positive change. And we are making headway.

Since the early 1990s, we have consistently grown world oil and gas supplies while reducing environmental impacts. One way is by steadily reducing natural gas flaring.

We have increased community benefits. At the same time, we have cut exploration and production costs – savings that drop straight to our host countries' bottom lines.

During this same period, we went from battles that pitted economic gain against the environment to concepts of sustainable growth that respect local cultures, natural resources and the desire for economic progress.

Many of us have embedded these concepts in formal codes of ethical behavior. At my company, we call it "The ChevronTexaco Way."

Our vision is "to be the global energy company most admired for its people, partnership and performance."

Our vision is "to be the global energy company most admired for its people, partnership and performance." Its foundation is built on our values – they say who we are and in what we believe.

These values are integrity, trust, diversity, partnership, high performance, responsibility, growth, and protecting people and the environment.

In addition, many in our industry have signed The Global Sullivan Principles and support their strong stand for international human rights.

More good news is the growing role of petroleum technology in improving the quality of life:

  • advanced seismic analysis
  • horizontal and directional drilling
  • seafloor processing
  • fuel cells and microsensors

All are reducing our footprint on communities, on global climate change, on local and regional wildlife habitats.

But the very best news is that as our companies grew more efficient as operators, our attitudes and values changed.

The fact is that today our industry realizes how integral to operational excellence the environment, health, safety and social responsibility are.

We have seen the link between doing good and doing business. And we are more acutely aware that excellence cannot be achieved alone.

... today our industry realizes how integral to operational excellence the environment, health, safety and social responsibility are.

Of course, we must continue to prove ourselves, to demonstrate we can meet the challenges ahead, that we can make hope happen.

As we go forward into the new century, armed with greater efficiency, sharper tools of technology and heightened management skills, we must show that operating responsibly – operating with excellence – extends not just to our hands, not just to our minds, but to our hearts.

We can achieve this.

Working with our partners to improve health, safety and the environment not only shows our commitment to social responsibility, not only helps assure our business success, it also makes better humans of us all.

Thank you.

Updated: March 2002