Chevron 2011 Corporate Responsibility Report

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Learn more about how Chevron is doing in important areas of our corporate responsibility (C.R.) efforts in our latest C.R. Report.

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Chevron 2011 Corporate Responsibility Report

  1. 1. 2011 Corporate Responsibility Report i
  2. 2. Welcome3 4 8 12 18A Message Operational Indonesia: Colombia: U.S. Northeast:From Our CEO Excellence and Partnerships in Working With Unlocking Potential Risk Management Conservation the Wayúu in Pennsylvania Employees discuss and Preservation While respecting one Developing affordable how we manage our Our community of Colombia’s oldest energy begins with safe operations safely programs on the island cultures, we develop operations, environ- and reliably. of Java protect the energy responsibly and mental stewardship and environment and address local needs. trust with the community. sustain livelihoods. Human Rights 17 The Environment 21 Renewable Energy 11 Executive Interview 23On the cover: Chevron partners with the Wayúu community in Colombia to make sure that the company’s presence on Wayúu land does not affect traditionallife. Here (from left), Delilia Ipuana Uriana, Zaida Ipuana and Sophia Maria Epieyu are fishing, which is a traditional livelihood for the Wayúu and provides animportant source of food. Chevron worked with the community to develop commercial markets for their fishing, farming and traditional handicrafts.
  3. 3. Partnering for a Better Future We can accomplish great things when we work together. By building enduring partnerships, we promote mutual benefit for our business and the communities where we live and work. We dedicate our people, time and resources to working side by side with partners in many countries to find solutions that support human progress and economic development.24 28 34 38 40South Africa: California, Nigeria: Progress Update AdditionalFrom Education to United States: Transformative We share milestones InformationEmployment Partnerships Investments in our operations and and DataThe Cape Town That Inspire Our innovative communities. Performance DataRefinery works with the Our investments in partnerships support GRI and API/IPIECA Indexcommunity to provide education contribute to economic and social Assurance Statementtraining and foster economic development. change to improve the Glossaryeconomic opportunity. quality of life. About This Report Social Investment 31 Diversity 37 Executive Interview 33 1
  4. 4. “Our goal is to ensure that our social investments create measurable and enduring value.”How We Chose What to Include The Chevron Wayin Our ReportIn this report, we We consult governments, The Chevron Way definesselected case studies communities, nongov- who we are, what wethat demonstrate ernmental organizations, do and what we believe.our partnership and academic institutions At the heart of The Chevronperformance in geog- and others to help us Way is our vision … to beraphies where we do identify emerging issues, the global energy companybusiness, as well as topics develop our projects, most admired for itsassociated with our and respond effectively people, partnership andapproach to responsible to evolving challenges performance.energy development — and expectations.Operational Excellence, We make this visionenvironmental steward- We welcome your com- a reality by consistentlyship, human rights, ments on the content in putting our values intoworkforce development, this report and on our practice. The Chevronhealth and safety, and website at Chevron.com/ Way values distinguish ussocial investment. CorporateResponsibility. and guide our actions so that we get results theIn an industry as complex Feedback can be sent to right way. Our values areas ours, we recognize us at Chevron.com/ integrity, trust, diversity,that our ability to operate Contact/EmailChevron. ingenuity, partnership,depends on how well we protecting people and theaddress the business, environment, and highsocial and environmental performance.expectations of ourstakeholders. To read more about The Chevron Way, please visit Chevron.com/ChevronWay.2
  5. 5. A Message From Our CEO John S. Watson Chairman of the Board and Chief Executive Officer May 2012Affordable energy is a cornerstone the drawing board through daily where we operate. We apply theof human progress and economic operations; same fundamental approach to ourprosperity. We create value for our • environmental stewardship — our social investments that we applyshareholders by providing that means of reducing our impact on our to our capital investments.energy safely and reliably. operating environments; We work with our partners to identifyMany of our business operations • operational discipline — our approach and assess needs and to determineinvolve risk, which we work tirelessly to making certain that our employees the scale and focus of investments.to mitigate. We use processes and and contractors perform every task Our collaborative approach is rootedtools guided by our Chevron Way the right way, every time. in business discipline and focused onvalues and designed with one goal outcomes. And our goal is to ensure Each falls under our Operationalin mind: zero incidents. that our social investments create Excellence Management System, which measurable and enduring value, as guides how we manage risk through-Over the past decade, our concerted they do in the case studies highlighted out the company. I encourage you toefforts have helped us become an in this report. read more about our approach toindustry leader in safety. But, we’re Operational Excellence in this report. Over the past six years, we’ve investednot yet incident-free. We work tolearn from our incidents and those approximately $1 billion in areas Managing risk well helps us maximizeof others so that we can reach and essential to sustainable communities, the value of the investments we makemaintain our goal of zero incidents. including health, education and to find and produce energy. TheseThat is my personal commitment. economic development. investments are significant. Our capitalAnd I know that the men and women and exploratory budget in 2012 is It’s a matter of pride for us thatof Chevron join me in committing $32.7 billion, which will be invested in our 57,000 employees strive to maketo our world-class standards in energy projects that will produce Chevron the partner of choice byOperational Excellence. for decades, generate tax revenue, providing energy the right way and help create local jobs and support remaining a force for shared progressAt the heart of our work is an local businesses. and prosperity.ongoing focus on three areas criticalto operating incident-free: In addition to these direct economic• process safety — a system to help benefits, we also make significant recognize and reduce risks, from social investments in the communities 3
  6. 6. Operational Excellence andRisk ManagementWe focus on protecting the safety and healthof people and the environment and conducting ouroperations reliably and efficiently. The systematicmanagement of process safety, personal safety,health, the environment, reliability and efficiency toachieve world-class performance is how we defineOperational Excellence.To achieve Operational Excellence (OE), we created an Operational ExcellenceManagement System (OEMS) more than a decade ago. It’s part of our cultureat all levels of our business. OEMS helps us identify, manage and reduce risk;improve performance; assure compliance; and sharpen our emergency response.It is a system that sets expectations for nearly everything we do operationallyand goes beyond the scope of internationally recognized management systemsfor environmental as well as occupational health and safety (ISO 14001 andOHSAS 18001).Our OEMS Tenets of Operation guide our workforce’s daily decisions and activities.These tenets are founded on two key principles: “Do it safely or not at all” and“There is always time to do it right.” For example, every person working at aChevron facility has the authority and responsibility to stop work when witnessingany unsafe action or condition. Our goal is to have incident-free operations sothat people remain safe and the environment is protected.We strive to achieve Operational Excellence through our processes, standardsand behavior with leadership action and the full involvement of our workforce.We are among the leaders in our industry in preventing incidents and injuries,as measured by the Total Recordable Incident Rate and the Days Away From WorkRate. Our OE platform provides us with a way to sustain high expectations andcontinual improvement.To learn more, please read our OEMS brochure atChevron.com/OEMS.Tricia Padilla is an environmentalspecialist and Charles Odumah is asenior process engineer at Chevron’sRichmond, California, refinery.4
  7. 7. Striving to Achieve Operational Excellence On any given day, more than 250,000 employees and contractors from varying cultural and educational back- grounds work on our projects and in our operations. Through disciplined implementation of our Operational Excellence Management System, our diverse work- force applies OE processes, procedures and behaviors in our daily operations. On the following pages, employ- ees in leadership positions share their insights about Chevron’s OEMS in action. Reducing the Risk of Incidents“ It’s been a seven-year journey to achieving zero incidents in Bangladesh — one that required a cultural ‘paradigm shift.’ We started with an environment that had low safety awareness. By establishing a strong leadership commitment to safety, significant oversight of contractors, continual training and effective implementation of standard processes — such as management of safe-work practices — we changed the safety culture. Now, we have accumulated more than “ We strive to reduce the risk of incidents by 31 million workforce hours without a Days Away disciplined application of Chevron and industry From Work injury.” process safety standards and best practices, Kinnesh Dalal, Manager of Operational with a particular focus on our Asset Integrity Excellence/Health, Environment and Safety, Management Program. In 2011, as part of this Chevron Bangladesh program, we verified the integrity of more than 8,700 critical components of our facilities, includ- ing key pressure vessels and piping. We use the Chevron Risk Management Process for regular reviews of all facilities and capital projects and for action planning to reduce health, environmental and safety risks across our operations.” Artur Custodio, Manager of Production Operations, Chevron Angola 5
  8. 8. Assuring Compliance “ It’s our job in the OE audit group to verify “ Members of my team go into the field to assess that we have the right people, processes and contractor knowledge and then provide immedi- equipment in place to mitigate risks at all levels ate feedback. We collect data to help break the of our operations — from major capital projects incident chain before incidents happen. We’ve to daily maintenance programs. These audits conducted more than 14,000 safe-work-practice are conducted at an established frequency and assessments over a two-year period, and this involve hundreds of interviews, data collection effort has helped us significantly reduce our Days and checks that systems are in place to reduce Away From Work incidents.” risks. Chevron operates to the same standards Lane Blanchard, Contractor Management around the globe, and we are always looking Advisor for Health, Environment and Safety, for ways to improve upon what we are doing to U.S. Gulf of Mexico reach our goal of operating incident-free.” Jane Fruin, General Manager of the Corporate OE Audit Group Improving Performance“In 2011, we welcomed the Australian government’s “Our ultimate goal is zero incidents, so it is environmental approval for our Wheatstone important that we learn from the past and make Project in Western Australia. Because we have improvements to prevent the same incident had unwavering support for comprehensive from being repeated. We conduct reviews of all terrestrial and marine assessment and under- incidents and major near misses throughout standing of habitats and species, we have been Chevron. We use a team of subject-matter able to show that Chevron can manage the environ- experts to examine the root causes of the serious mental impacts and potential risks. Protecting incidents and near misses in our annual Major the environment is a fundamental part of our Incident Study. This helps us look for common Chevron Way values.” trends, determine where processes and pro- Andrew Mingst, Environmental Manager cedures may need to be improved, and identify of the Wheatstone Project, Chevron Australia opportunities to strengthen our OE culture and leadership.” Todd Levy, Vice President of Chevron Upstream 6
  9. 9. Preparing forEmergencyResponse “ Our first priority is to prevent emergencies, such as spills and releases, but we also need to be prepared to respond to them when they do occur. Our operating units develop site-specific emergency response and business-continuity Chevron’s OEMS plans that address and provide resources for all significant risks. We continually train our work- Tenets of Operation force and conduct drills to improve readiness. Our tiered emergency response system includes 1 Always operate within design local incident command teams supported and environmental limits. by corporate and external resources, which we recently deployed in Brazil and Nigeria.” 2 Always operate in a safe and Jeff Patry, Manager of Emergency Response for controlled condition. Corporate Health, Environment and Safety 3 Always ensure safety devices are in place and functioning. 4 Always follow safe work practices and procedures. 5 Always meet or exceed customers’ requirements.Response to 6 Always maintain integrity ofRecent Incidents dedicated systems.In late 2011 and early 2012, Chevron 7 Always comply with all appli-faced two incidents. Extensive training cable rules and regulations.and preparation helped the companyrespond quickly and effectively. In 8 Always address abnormalNovember 2011, during drilling opera- conditions.tions at our Frade deepwater projectin Brazil, hydrocarbons from the well- 9 Always follow writtenbore reached the seafloor through procedures for high-risk orseep lines. Our response significantly unusual situations.reduced the size of the sheen and 10 Always involve the rightstopped the source of the seep flowwithin only four days of first detection. “ Incidents such as these are vivid reminders people in decisions that affectAs a result, no oil reached any shoreline. of the risks we face in our business. Our procedures and equipment. Chevron values place the highest priority on the health and safety of our workforceIn January 2012, a fire started aboard and the environment, and our culture ofthe shallow-water jack-up drilling Operational Excellence challenges us dailyrig KS Endeavor, which was drilling a to learn and improve from every experiencenatural gas exploration well off the and observation. We continue to strivecoast of Nigeria. The quick implementa- for incident-free operations and sendingtion of emergency response procedures our entire workforce home without injury.”resulted in the safe evacuation of 152 Jim Swartz, General Managerpeople in eight minutes. Tragically, of Corporate Operational Excellencehowever, the incident claimed two lives. 7
  10. 10. 8.7 108 30,200 million farmers are partnering with Chevron to restore forests and improve trees have been planted through Chevron- supported environmental people are served by Chevron’s geothermal agricultural practices programs power operations in IndonesiaBird-watchers observe bird species inside Salak operations. During this trip, they identified species that previouslyhad not been recorded by the BirdLife Indonesia Association.8
  11. 11. Indonesia:Partnerships inConservation andPreservationWe work to increase environmental awarenessin our operations and in the community.Dayat Hidayat supports his three sons to improve farming practices near the commitment to environmental per-by growing chilis and long beans on a park and protect forests. We are also formance and helps us expand our1-acre (0.4-ha) plot within Indonesia’s working with the farmers to preserve business in Indonesia. We understandMount Halimun Salak National Park, traditional techniques such as crop that people, the natural environmentthe largest rainforest on the island of rotation and natural pest control, which and our operations are interdependent.Java, where farms, endangered species are critical to sustaining crop produc- In all our major capital projects, weand Chevron’s expansive Salak geo- tion rates. integrate biodiversity into our businessthermal operations coexist. Our ability decisions by using the environmentalto work with the community to balance For Hidayat, the conservation pro- stewardship component of our Opera-environmental stewardship, energy gram helps improve his business. tional Excellence Management Systemdevelopment and the community’s “The farming training has widened (OEMS). We work closely with govern-needs demonstrates how our partner- my perspective and provided me ment agencies, nongovernmentalships help protect the environment with knowledge about environmental organizations and community groupsand sustain livelihoods. protection and better agricultural to manage our operational footprint practices,” he said. “Understanding in order to protect the unique environ-Indonesia faces constant challenges to organic farming by using available ments where we are developing energy.produce more crops on limited arable resources in the environment is partland without encroaching further on of this work, like using sheep’s dung Mount Halimun Salak National Park isforestland. In areas in and around for fertilizer and learning good cattle- home to endangered species such asMount Halimun Salak National Park, breeding practices.” He said Chevron’s the Javan leopard, gibbon and hawk-timber was harvested to clear new assistance in establishing farming eagle. These animals are often spottedland for farming and for wood for cooperatives helps him pool resources inside Chevron’s Salak geothermalother businesses. In Hidayat’s village, and stabilize his income. operations areas. We partner with thethree-quarters of the 2,000 residents national park and local, national andare farmers. Hidayat and 107 farm- Business and the Environment international wildlife groups to protecters like him are working with us and Our ability to operate safely in unique wildlife habitats and maintain nurseriesour partners on a community-based environments such as Mount Halimun to restore trees that were used toenvironmental conservation program Salak National Park demonstrates our support local businesses. 9
  12. 12. In our day-to-day operations, we Building a Conservation Ethicfollow strict policies to leave wildlife We have a long-term commitmentundisturbed, and we design pipelines Planting to community-based environmentalto accommodate animal crossings. conservation programs in Indonesia.We collaborated with governmentauthorities to minimize tree removalduring pipe and well installation that 250,000 In 2002, we launched our partnership with the nonprofits Peduli Konservasi Alam Indonesia (PEKA Indonesia)was completed before the start of trees is a five-year and the Wildlife Trust to protectcommercial operation in 1994. We also goal of the Green Salak Mountain’s ecosystem. PEKA’splanted 3,000 trees inside our Salak Corridor Initiative work focused in part on environmentaloperations area as part of a regreen- education and protection. At thating effort. time, PEKA reported that the illegal poaching and sale of several beetle species in and around our Salak geothermal area were destroying forests and threatening biodiversityCommitment Beyond Compliance: and nearby communities’ agriculturalZero Water Discharge water supply. We continue to build upon conser-Starting in 2011, Chevron that are approximately excess produced water,” vation programs in areas near ourengineers successfully 1,000 feet (305 m) below said Ferry Martin, Chevron Salak operations, including the ruralimplemented a zero- the ground. Injecting the general manager of Health, farming communities in Bogor andwater-discharge system water into reservoirs is Environment and Safetyat our Duri heavy oil fields a preferred practice that in the region. “It’s a good Sukabumi. Unemployment is high inin Sumatra. Every day, eliminates any impact example of teamwork with those communities, where 60 percentwe produce approximately on natural canal systems. the government and our of the population in the Salak area1 million barrels of water We plan to expand this commitment to managing are women and youth. We partneras part of our oil operations zero-water-discharge our environmental foot- with the nonprofit Yayasan Binathere. More than 80 percent practice to other fields print. The government hasof the produced water is in Indonesia. asked us to share our best Usaha Lingkungan (YBUL) to educateused in enhanced oil recov- practices and applications farmers like Hidayat about rabbitery operations, while “We are among the few with other companies. and goat breeding as well as otherthe remainder is treated oil and gas companies in We’re proud to do that.” alternatives that will not degradeand put into government- Indonesia that implement forests or deplete the communities’approved reservoirs a zero-discharge policy forAbove: At its Salak geothermal operations, Chevron has a nursery that germinates seedlings of native species to plant and maintain withinthe operations area. The company also collaborates with a nearby tea plantation to plant trees along the plantation’s access road.10
  13. 13. “Chevron makes environmental protec- tion and community their priority,” said Gita Gemilang of YBUL. “Shifting the community’s dependency from Renewable forest products to other sources of income generation that could become Energy their alternative pillar of livelihood becomes crucial in this program. Chevron’s initiative is a path to sustain- ability for farmers.” Investing in renewable energy and energy In late 2011, we continued our support of conservation efforts by launching efficiency is one the Green Corridor Initiative, with of Chevron’s business a goal of planting 250,000 trees over strategies. five years. This effort helps restore the degraded forest that connects We take a pragmatic approach more than 1,200 acres (486 ha) of the to investments, focusing on three ecological zone of the Mount Halimun key areas that leverage our core Salak National Park forest corridor. competencies and existing assets: The initiative involves more than 1,500 our geothermal business; the people, the Mount Halimun Salak profitable, commercial-scale National Park, foundations, universities development of next-generation and local nongovernmental organiza- biofuels; and the development tions. In December 2011, our employ- of energy efficiency solutions. ees, Mount Halimun Salak National Park representatives and community Geothermal power is the most members planted the first 5,000 trees. significant segment of our renew- This effort is part of a much larger able energy portfolio. We are the one by the Indonesian government world’s largest geothermal power to rehabilitate the country’s damaged producer and have maintained forests and replant barren lands. operations in Indonesia and the Philippines for 30 and 40 years, In addition to our Green Corridor respectively. Our geothermal Initiative, in 2011 we worked with operations generate more than local schools, government agencies 1,250 megawatts of electricity perTop: The Javan hawk-eagle has a safe home and nongovernmental agencies to year — enough to meet the needsin the Mount Halimun Salak National Park, nearChevron’s Salak geothermal operations. plant 22,200 trees outside of the park of 16 million people in these twoBottom: Chili is one of the crops planted by local but near our operations in Bogor countries.farmers near Chevron’s operations. and Sukabumi and in the Jayanegara Through our technology ven- To see more of our activities in Indonesia, tea plantation. tures business, we partner withwatch the video at Chevron.com/CR2011/Indonesia. others to increase our knowledge In 2011, the Indonesian Ministry of biofuels and the technologyagricultural supply. Also, YBUL of Environment honored Chevron needed to transform natural rawencourages traders and craftspeople Geothermal Salak and Chevron materials into profitable, high-to switch from making furniture Geothermal Indonesia with the quality transportation fuels.from park timber to environmentally PROPER Gold and Green awards,friendly, income-generating work such respectively. The PROPER award isas cultivating vegetables and fruits — regarded as the most prestigious Learn more at Chevron.com/a program that contributes to local award in environmental stewardship EmergingEnergy.food supplies. In 2011, these programs in Indonesia.benefited more than 1,500 people. 11
  14. 14. Colombia:Working Withthe Wayúu12
  15. 15. For 35 years, Chevron has worked with Wayúu communities in Colombia,producing energy, strengthening the communities’ capabilities andrespecting local customs. Our partnership blends our ethics of safety,environmental responsibility and shared progress with importantvalues of the region’s Wayúu people: kindness, friendliness and respect.Jaime Epinayu (foreground) and his family are one of 600 families who participate in a Chevron-supported social investment program for fishermen in La Guajira in northern Colombia,where Chevron operates offshore and onshore natural gas fields in Wayúu indigenous territory. 4 million 172 22 households in Colombia Wayúu communities farms were created are supplied with natural were consulted before through Chevron’s pilot gas from Chevron’s Chevron began new program launched operations exploration in 2010 in 2011 13
  16. 16. Paul Pinedo grew up in a clan amongthe indigenous Wayúu people ofColombia’s coast and clearly remem-bers his first glimpse of an offshoredrilling platform. “I was 10 years oldand was fishing with my uncle. I askedhim what it was, and he said, ‘a con-struction from an alien civilization.’For us, we had never seen a buildingwith electricity in the middle ofthe sea,” Pinedo said.Today, Pinedo is 27 and a Chevronengineer, and he understands fullyhow the platform functions. Afterhigh school, he was unsure how hewould make a living, and talkingto a friend helped him gain an interestin engineering. Upon completing hiscollege engineering degree, Pinedostarted with Chevron as an intern andwas trained to work on the platformthat he first saw with his uncle. Hesaid he takes pride in bridging one ofColombia’s oldest cultures and themodern world of energy development.Pinedo’s story is a small part of a muchlarger one of how Chevron partnerswith the Wayúu, the national oil com-pany, the government and nongovern-mental organizations to developenergy in La Guajira, a region betweenColombia and Venezuela. Pinedo saidmost of those in his native Epinayuclan, which includes his 27 uncles andthree brothers, are not interested inleaving their community. ”They prefer Above: Wayúu community leader Maria Luisa Ipuana and her neighbors partner with Chevronfishing and farming,” said Pinedo. to expand their farming livelihoods and help improve their families’ nutrition.The Wayúu live in La Guajira and ownland near our coastal operations in the people of La Guajira and the rest Chuchupa gas field as well as thenorthern Colombia. Our relationship of Colombia. onshore Ballena and Riohacha gaswith the Wayúu reflects the way fields in La Guajira. We have becomePinedo bridges his two worlds. We A Long History, a Shared Future Colombia’s largest producer ofrespect local traditions, protect the Chevron first stepped foot in Colombia natural gas, supplying approximatelyenvironment, address community in the late 1920s to explore for oil, 4 million households. La Guajiraneeds and advance economic oppor- but it wasn’t until the 1960s that we supplies approximately 65 percenttunities. Our strong partnerships help discovered both oil and natural gas. of the country’s natural gas.us responsibly expand our operations, In partnership with Colombia’s nationalresulting in benefits to our business oil company, Ecopetrol, Chevron With natural gas reserves in decline inand quality-of-life improvements for operates and develops the offshore La Guajira, the national government14
  17. 17. partnered with Chevron in 2010 toexplore for new natural gas resourcesalong 233 miles (375 km) between the Increasing OpportunitiesLa Guajira shoreline and deeper ocean. for Education“Because of our reputation forenvironmental responsibility and our Support for education in Mayapo Ethno-Educational for Chevron who is Wayúu.longstanding relationship with the the communities where we Center to serve communi- “It is an excellent alterna- operate is important to us. ties in rural areas of the tive for families to be ableWayúu, we were able to move forward In La Guajira, we trained Manaure municipality. Now to send their children towith this important project,” said teachers, who have helped 1,200 children can receive this school. At Laachon,David Bantz, president of Chevron more than 1,500 students education and boarding. children are experiencingColombia. “It’s critically important to improve their national Also, the center provides the best Arijuna (Western)us that our operations embody the test scores. girls with greater access to education while keeping formal education. their ancestral backgroundrespect we feel for the people and Many Wayúu youth cannot and culture.”their land. Our efforts reflected that go to school because they “Wayúu children are receiv-commitment.” live too far away. Chevron ing top-level education both helped finance the con- in Spanish and Wayúunaiki,”Before beginning our exploration work struction of the Laachon said Danis Cohen, an analystin 2010, we spent a year consultingwith 172 Wayúu communities, each ofwhich is considered an independentgovernment entity. We invited Wayúuleaders to visit operations and talkabout their culture and concerns. Ourdialogue reaffirmed the foundationfor a constructive relationship.“The spoken word is important forus, and Chevron approached our com-munities like a neighbor who knockson your door,” said Victor ManuelEpiayu, who grew up in a Wayúu clanand works for Chevron on communityprograms. “The Wayúu have a lotof respect for that great attitude.”Following our initial outreach, we imple-mented our formal Environmental,Social and Health Impact Assessment(ESHIA) process to evaluate potential Above: To support the education of Wayúu children who live far from schools, Chevron helped fund the construction and operation of education centers, such as the Laachon Mayapo Ethno-Educationalimpacts on surrounding communities, Center, seen here.natural resources, biodiversity, air qual-ity, land use, waste management, noiseand public health. The assessment was our exploration site. To help ensure dirt roads were watered down toconducted in partnership with stake- safety, trucks and other vehicles limit truck dust so that children ridingholders to make sure that we captured heading to Chevron facilities were bikes to school were not affected.and addressed community concerns diverted from Wayúu water reserves Our exploration team also worked withabout reactivating natural gas fields and traditional pathways to the ocean. local fishermen to reduce the impactand drilling new-development gas wells. Cables used in the process were of our work on their livelihoods. positioned to avoid culturally sensi-From our discussions, we learned that tive areas. Livestock were temporarily We employed more than 360 localwe needed to change how we accessed moved from our work locations, and people, 60 percent of whom were 15
  18. 18. municipalities of Riohacha and Manaure, benefiting 100,000 indig- enous people. In the Mayapo rural area located in La Guajira, Wayúu communities are vulnerable to food shortages and have limited access to water, sanitation and health centers, in part because of the arid terrain. According to the 2010 Colombia Demographic and Health Survey, the rate of children facing malnutrition in La Guajira is 10 times higher than in the rest of the country. To address these needs, we built six health clinics in 2010 and launched a pilot program in 2011 that created 22 farms. By combining participation of professional farmAbove: Farmer Salvador Ipuana (foreground, left) and other Wayúu community farmers at the specialists with the ancestral wisdomrancheria speak with Victor Manuel Epiayu (foreground, right), who grew up in a Wayúu clan and of the Wayúu, the project promotesworks for Chevron to help implement community programs. the conservation of native species, the To hear from Wayúu people, watch the video at Chevron.com/CR2011/Colombia. control of pests, the planting of trees for timber and the development ofWayúu, to assist with the ESHIA “Chevron understands that meaning- foliage to provide shade.process. Then we added them ful social projects are not short-termto our exploration team to work on activities. They know it takes time The experimental farms have improvedproject support activities. The multi- and effort to achieve sustainable nutrition and income among partici-cultural team shared safety principles results,” said Gina Marcela Puentes of pants. As a result, we are working withand practices with each other in the Ecosfera Foundation, a nonprofit the local governments of the remainingSpanish; the local dialect, Wayúunaiki; organization that works with the 150 Wayúu communities to implementand English. Wayúu on programs to improve their similar programs. livelihood and preserve their culture.The seismic and drilling gas project “I have seen other companies that “Now we have options. We have food.was completed in 2011 without injury don’t even bother to go to the ranche- Without the support of Chevron, weor incident. According to the national rias (Wayúu villages) to talk with the wouldn’t have this,” said Maria Luisaoil company, Ecopetrol, and the Wayúu authorities. Chevron gives Ipuana, a Wayúu leader who benefitedMinistry of the Interior and Justice, the proper importance to each one of from the program.our consultation with the commu- the communities and the people, andnities and the social and environmental that really makes a difference.” Supporting a Way of Lifeprocesses we implemented have For Alberto Hernandez and his fellowthe potential to be a model for other, To collaborate on finding new ways Wayúu, fishing is a way of life. “Supportsimilar projects in Colombia. to improve the quality of life in La by Chevron has been important for us Guajira, Chevron became part of a and our families. Our fishing activitiesPartners in the Community 29-member Regional Commission for and our livelihoods are more developedWe continue to work with Wayúu Competitiveness composed of unions, and sustainable,” he said.communities to identify their areas of nongovernmental organizationsneed: infrastructure improvements, and other members of civil society. The platforms we built off the coast,educational and health programs, We partnered with the Ecosfera the first in 1973 and the second insustainable agriculture and fishing Foundation to drill and develop eight 1996, naturally became reefs whereindustries, and support for an emerg- drinking-water wells and improve the Wayúu saw an opportunity to fish,ing tourism industry. sanitation in rural areas of the but safety concerns prevented fishing16
  19. 19. Human Rights Our commitment to respecting human rights wherever we operate is grounded in The Chevron Way, which describes our vision and values.Above: Chevron engineer Paul Pinedo, who grewup in a traditional Wayúu community, studied We replaced our Human Rights all of which have responsibilitiespetroleum engineering and is one of the few in Statement with a corporate for meeting our human rightshis family to choose a nontraditional career. policy in 2009 to foster greater commitments.Below: Chevron provides training and marketing awareness of human rightssupport to help the small businesses of tradi- issues throughout the company The team conducted an exten-tional Wayúu artisans. and enhance our capabilities to sive review of Chevron’s existing manage them. Our Human Rights policies and practices, andaround active operations. To help Policy covers four areas relevant developed additional training andfishermen like Hernandez sustain to our business: employees, guidance to deepen the company’stheir fishing and develop commercial security providers, communities collective understanding andmarkets, we created artificial reefs and suppliers. We began deploying capabilities. The Danish Institutein deep water away from our opera- the policy in 2010, with full imple- for Human Rights providedtions. Through supplying equipment mentation projected for 2013. external advice.such as global positioning systems,along with technical training and We formed an internal, cross- From 2010 to 2011, we conductedfinancial assistance, Chevron helped functional, global team to guide orientation sessions with selectmore than 640 fishermen in rural implementation and enable en- executives and staff. In 2012,areas of the Manaure municipality in gagement from Human Resources; we will focus on deploying theLa Guajira. Global Security; Supply Chain updated training and guidance to Management; Policy, Government relevant parts of the business.We partner with the Wayúu to sup- and Public Affairs; Law; andport other small business enterprises. Health, Environment and Safety —The Wayúu have a tradition ofproducing colorful handmade bags,hammocks and blankets. We part- Learn more at Chevron.com/HumanRights.nered with Jalianaya — a cooperativeof Wayúu women from the Manauremunicipality — to provide trainingand marketing support to more than600 weavers to increase their income.“Our women lived off salt extractionand fishing. They fed on boiled fishand ate once a day, until the Chevron-led program empowered us to commer-cially exploit our crafts and have abetter life,” said Maria Cristina Gomez, aleader within the Wayúu community. 17
  20. 20. U.S. Northeast:Unlocking Potentialin Pennsylvania18
  21. 21. 700,000 446 60 acres (283,300 ha) of Chevron employees work wells were drilled in the the Marcellus Shale in western Pennsylvania area by Chevron in 2011 are leased by ChevronAt the site of a reclaimed natural gas field in western Pennsylvania,a producing well leaves a small footprint.As Chevron enters western Pennsylvania to develop natural gas fromthe Marcellus Shale, the company is striving to be the partner ofchoice, with a focus on safe and responsible development that promoteseconomic growth. 19
  22. 22. In Fayette County, Pennsylvania, Adding to Economic GrowthBill Jackson owns a dairy farm that his Marcellus natural gas can providefamily founded in 1940. It’s not unusual cleaner-burning, affordable energy,for him to log 18-hour days tending which supports energy security,to cattle and corn among the verdant regional jobs and economic growthrolling hills, rivers and forests typical of for the United States and places likethis rural area. A part of his farm is also Fayette County. Chevron is helpingleased for natural gas drilling. ensure that the people of southwest- ern Pennsylvania benefit from this“Natural gas is a resource that provides resource without compromising theirenergy for the country. It’s every bit communities or the environment.as much a part of the farm as the hay-field or the cornfield that we see A 2011 study by global informationabove the surface,” he said. company IHS estimated that by 2015, Above: Greg Hild (left), a Chevron business approximately 270,000 new jobs development manager, and Nate Calvert,Western Pennsylvania residents like will be created in the Marcellus region, a Chevron public affairs representative,Jackson share a strong work ethic. which could also support 1.6 million review operations plans at the natural gasBut with the decline of the steel and jobs by 2035. drilling site in Somerset County, Pennsylvania.coal industries over the past four Below: Bill Jackson has leased land on his dairy farm to Chevron for natural gas drilling.decades, the region has suffered Chevron drilled 60 wells in 2011 andeconomically and has seen a popula- will continue to expand operationstion decline. in ways that benefit local economies gas has the potential to have the big- while limiting negative impacts. gest impact on our region’s economy inIn early 2011, Chevron acquired According to Jackson, “The Marcellus my lifetime,” said Oliver, a governmentindependent natural gas producer industry has provided a much-needed and public affairs manager for ChevronAtlas Energy, Inc., and began producing boost to the economy. The hotels and operations in the region. According togas in southwestern Pennsylvania. restaurants are full. It has provided jobs the Pennsylvania Department of LaborNearly all of the 366 employees who for well operators, truck drivers, drillers & Industry, from late 2009 to earlyjoined Chevron as a result of the and excavators — a wide array of jobs.” 2011, 72,000 people were hired in theacquisition continue to work with us core and ancillary Marcellus industries.today. With more than 700,000 acres Chevron’s Trip Oliver grew up in Pitts-(283,300 ha) under lease in the burgh, Pennsylvania, and understands To encourage long-term job growth, weMarcellus Shale, Chevron is one of the importance of this opportunity. are partnering with Carnegie Sciencethe state’s largest leaseholders. “The development of Marcellus natural Center of Pittsburgh to launch the new Chevron Center for STEM Education and Career Development, which sup- ports science, technology, engineering and math (STEM) for students from preschool to high school in the region. “We need talented professionals — engineers, geologists, geophysicists and information technology special- ists,” said Bruce Niemeyer, head of Chevron operations in the region. “This program will help enable the Pittsburgh area to remain competitive in a 21st-century global economy.” Protecting People and the Environment Pennsylvania’s history of oil and gas To meet farmer Bill Jackson, watch the video at Chevron.com/CR2011/Pennsylvania. development dates back to 1859, when20
  23. 23. Colonel Edwin Drake developed the mental and safety professionals fromworld’s first commercial oil well at other operations to share best prac-a depth of 69 feet (21 m). The energyindustry has long known about huge tices and identify opportunities for improvement.” Chevron currently is Thegas resources trapped in shale rockthousands of feet deep across the working with regulators to strengthen regulations and with other energy EnvironmentUnited States. But only in the past producers to establish and enhancedecade have energy companies com- safety practices.bined two established technologies —hydraulic fracturing and horizontal Native Pennsylvanian Bryan Hajos We recognize thedrilling — to successfully unlock this worked for Atlas for four years and is value of fresh waterresource in the face of increased now a safe-work advisor for Chevron.energy demand. Hajos trains contractors and former as a fundamental Atlas employees in Chevron’s safety environmental and“Permission to operate depends on culture and procedures. One of our economic resource.our ability to do business responsibly. many tools used to drive safety per-Protecting land, water and commu- formance is the five-step stop-work As users of this critical naturalnities is our highest priority,” said authority: Stop the unsafe or at-risk resource, we must manageNiemeyer. “After the decline of this act, notify a supervisor, involve the water for the good of society,region’s coal mining and steel industries, right people in addressing the issue, ecosystems and industry, whichpeople here worked hard to clean up the resume work when the issue has been includes improving our water-environment. Western Pennsylvanians resolved and share what is learned. use efficiency.don’t want to give that up.” “We used stop-work authority to halt Chevron is committed to prevent-To foster dialogue between the com- a project to shore up a leased road, ing groundwater contaminationpany and local communities, we began which delayed the project, but made and spills, and meeting or surpass-work in 2011 to create an external advi- the road safer,” said Hajos. “With ing all regulatory and compliancesory council in Fayette County. The stop-work authority, contractors and requirements.council was established in early 2012, employees don’t need to explain lost To help enable the availabilityand we have plans to create additional productivity or time. New procedures, of safe and reliable freshwatercouncils in other areas. We participate training and values are creating a resources, we developed anin informational meetings, display our positive experience where everyone integrated corporatewide fresh-exploration and production equipment is looking out for each other.” water strategy that supportsat county fairs and other events, and responsible water stewardshipoffer media tours of well sites. Resi- Operating Responsibly and management. This strategydents also can ask questions or express “It only takes 10 seconds to scare peo- begins with prevention andconcerns through a community hotline. ple about the perceived risks of energy focuses on integrated practices development, but it takes months or that include well design andAfter acquiring Atlas, Chevron moved years to correct those misperceptions,” integrity, construction controls,quickly to share best safety and said Oliver. “It’s critical to communicate water use, handling, recycling,environmental practices with the new with southwestern Pennsylvanians and disposal.employees and contractors, using about our proven approach to unlock-our Operational Excellence Manage- ing natural gas from under their land.”ment System and underscoring ourcommitment to safe and responsible Producing gas from shale involvesoperations. “We acquired Atlas on a injecting water and special fluids intoFriday, and by Saturday morning, we rock thousands of feet below thesent an internal team of experts to surface and the groundwater aquifers.meet with key contractors to discuss A mixture of water and sand makes Read our freshwater position state-safety and environmental stewardship,” up more than 99 percent of the fluid, ment at Chevron.com/FreshWater.said Niemeyer. “During our first full and chemical components are lessweek, we hosted Chevron environ- than 1 percent. On FracFocus.org, a 21
  24. 24. 3,000 feet (914 m) of the proposedChevron Wells in Pennsylvania Are Designed to Safeguard drilling location and provide testGroundwater With up to Eight Layers of Protection results to the owner of each well and to the Pennsylvania Department of Environmental Protection. To improve Well Coal Private Municipal Fresh Site Seam Water Water Groundwater the industry’s transparency on water Well Well Aquifers quality monitoring, the Marcellus Shale Coalition is developing a public CEMENT 0 FT BARRIERS database in which companies will STEEL post results. 500 CASING1,000 Bill Jackson has the understanding that we hope others will gain as Casing for Avg. Maximum Groundwater we inform them about our safety Depth of Protection2,000 Groundwater measures. “Agriculture is our liveli- 350 FT hood, and we wouldn’t do anything to endanger that livelihood, whether Casing for Coal it’s the cows or the crops,” he said.3,000 Avg. Maximum Seam Isolation Depth of & Protection “Our cows are fed off a spring, which Coal Seam 700 FT was one of our early concerns. We’ve had it tested regularly, and nothing4,000 has changed.” Casing for Hole Stability & Well Avg. Depth of Control Chevron is also working to reduce truck5,000 Casing for Hole Stability & Well traffic. A typical well needs approxi- Control mately 1,200 truckloads of water for 2,700 FT drilling and completions activities,6,000 Production Casing Cemented for which will increase truck trips over Entire Length of Wellbore Pennsylvania’s rural roads. We are recycling water to reduce the number7,000 of trucks and emissions, and truck Top of Marcellus Shale > 7,000 Feet (1.3 Mile) From Groundwater drivers are undergoing safety training. We also work with local officials to8,000 determine the best routes. MARCELLUS LATERAL LENGTH: 2,000–5,000 FEET “When we are finished at a well site,1 FT = 0.3048 METER we leave the roads we used for access in the same condition as or bettervoluntary disclosure mechanism, we are typically no deeper than 350 feet than when we arrived,” Oliver said.disclose the chemical additives of the (107 m), while hydraulic fracturingfracturing fluids used in our wells. Our operations take place at approximately Many residents like Bryan Hajos hopewells are designed, drilled and installed 7,500 feet (2,286 m) to 8,500 feet Chevron can help reverse a decades-to protect the groundwater during (2,591 m) below the surface. We con- long trend in Pennsylvania. “In thehydraulic fracturing and over the life duct a series of tests over the life past 20 years, you’d go to college hereof the well, which can be 30 to 50 of the well to verify long-term integrity. and go somewhere else to find a job.years long. Now people like my friends and me, Our operations adhere to the com- who grew up here, have a chance to goIn Pennsylvania, we use a combination pany’s position statement on fresh to school here, stay in the communityof up to eight layers of steel casing water to safely and responsibly man- and work for a world-class organiza-and cement, which forms a continuous age fracturing fluids, wastewater and tion. Chevron is breathing new life intobarrier between the well and any produced water. We test all private the community.”groundwater. Groundwater aquifers wells used for drinking water within22
  25. 25. Executive Interview Wes Lohec Vice President for Health, Environment and SafetyWhy is natural gas What challenges How is Chevron address-from shale important does Chevron face? ing these challenges?to Chevron and Perhaps the biggest challenge is Chevron may be new to the Marcellusworld energy supplies? also our biggest opportunity — Shale, but we have been using and to improve community awareness advancing the foundation technologiesNatural gas from shale is dramatically and understanding about how for decades. From the day we acquiredchanging the gas supply landscape we operate. Atlas Energy, we have focused onin the United States — boosting applying our Operational Excellencereserves and providing a supply of The discussion of natural gas from Management System (OEMS) to oursafe, clean, affordable energy. shale has been clouded by complex, Marcellus operations. conflicting and sometimes inaccurateIt is the fastest-growing source of information about the technologies This starts with our robust well designnatural gas in the United States and we use. and drilling practices. We focus oncould become a major global energy water management, including workingsource. Natural gas from shale Every day we work to build trust with to recycle most of the water we usehas grown to about 25 percent of communities and other stakeholders, onsite. This reduces our freshwaterU.S. gas production in just a decade, knowing that trust can come only consumption as well as our needand according to the U.S. Energy from operating safely and responsibly for trucking and disposal. All of theseInformation Administration, it will be 24 hours a day, 365 days a year. practices aim to manage our environ-nearly 50 percent by 2035. mental footprint and the impact of our activities on the community.The development of this resourceis creating thousands of jobs, Stakeholder and community engage-improving energy security and ment is another core componentlowering GHG emissions from of our OEMS. We are learning from localelectricity production. communities about their concerns and sharing information about our opera-Our U.S. investments have positioned tions. In addition, we are committed tous to become a leading developer disclosing the chemical additives forof domestic shale gas. We also are all our new gas wells in the Marcellusexploring opportunities to develop Shale on the publicly availablenatural gas from shale in Canada and FracFocus (www.fracfocus.org) website.central Europe. 23
  26. 26. South Africa:From Education toEmploymentOur commitment to developing trade skills in thecommunities near our Cape Town, South Africa, refineryfosters social and economic opportunity.For Thembakazi Sidumo, a welder- entities and local community-based Sidumo, and many businesses thatin-training from the disadvantaged organizations. With unemployment support refinery operations.community of Du Noon in Cape estimated at 25 percent in South AfricaTown, South Africa, the new skills and 50 percent in Du Noon, these Our longevity in South Africa gives usshe is learning provide a way to programs provide value to residents an important stake in the community,forge a new life. throughout the region and are building as the nation’s journey of social, politi- blocks for a better life. cal and economic change unfolds.“Now that I am going to get my weld- Chevron was among the first support-ing certificate, I feel like I can walk In 2011, Chevron South Africa cel- ers of the Sullivan Principles in 1977,through any door and I can do the ebrated milestones that encourage which called for equal treatment ofjob,” said Sidumo, a contractor whose aspirations for the future. We marked employees regardless of race. Thatoptimism belies her residence amid the 100 years of operations in the coun- year, 40 percent of our more than 700estimated 100,000 living in Du Noon, try, the Caltex brand commemorated black workers were moved into refinerywhere illiteracy is common. “It is very 75 years and the Cape Town Refinery jobs traditionally held by whites. Today,challenging out there for a woman. celebrated 45 years. During the past more than 75 percent of our employeesBut women can do it,” she said with a century, we have become a leading at the refinery are black.smile, “as well as men can do it.” refiner and marketer of petroleum products in South Africa. We are one “We recognize that our businessThe skills training programs that she of the country’s top five petroleum success is linked to society’s progress,”and hundreds of other community brands, and nearly one-quarter of said Steven Parker, general managermembers are participating in provide Chevron’s Caltex service stations are in of Chevron’s Cape Town Refinery.training for employment opportunities the country. We have 1,000 employees “For South Africa to achieve high levelsat refineries and other industries in in South Africa and have approximately of economic growth and addressthe region. They are the result of a part- 440 employees at our Cape Town the challenges of poverty and inequal-nership between Chevron, government Refinery. We also hire contractors, like ity, it is vital that we help advance24
  27. 27. 100 98% 240 years of operations in of Chevron employees individuals participated South Africa was cele- in the country in Chevron-supported brated by Chevron in 2011 are South African training programs in 2011Msingathi Camagu, a mechanical fitter trainee, is learninghow to set a pump shaft in a center lathe for machining fromChevron machinist Francois Roux. 25
  28. 28. partnerships that share the vision of a Transforming Turnaroundsskilled and capable workforce.” Chevron is focused on being the In 2011, the partner of choice in the communityResponding to Change refinery achieved by actively participating in theThe country is undergoing a historic development of the country. Ourtransition to address the systematicexclusion of the majority of South 4.25 million Cape Town Refinery supports the community skills training programsAfricans from full participation in the work hours without for refinery “turnarounds” as aeconomy, particularly black South a Days Away From way to reverse inequities broughtAfricans, people with disabilities and on by the apartheid system.women. The South African govern- Work injuryment policy on these changes is called A turnaround is a planned, periodic“transformation.” shutdown of a refinery to perform maintenance, test and replace“It’s important for all people in the materials, and repair equipment.community that companies like Turnarounds occur periodically atChevron are doing the right thing the Cape Town Refinery. They takewhen it comes to transformation. months to plan and up to two monthsEveryone is aware that the whole to complete. They are necessary tonation is on a journey,” said Parker. maintain safety, improve efficiency and reliability, and sometimes expandThe South African government capacity. This type of maintenanceestablished the Broad-Based Black requires 1,000 to 2,000 qualifiedEconomic Empowerment (BBBEE) Act contractors, depending on the workin an attempt to improve economic needed. Understanding Chevron’sopportunities. Companies must provide safety culture and processes is essen-their audited BBBEE score card rating tial to the work and helps build uponwhen bidding for business, and the the refinery’s safety record. In 2011,rating directly influences the award- there were no Days Away From Working of contracts and trading licenses. injuries during 4.25 million hoursThe score card measures companies’ on the job.performance in key areas, includingskills training, employment equity, Contractors working on turnaroundsenterprise development, preferential undergo Chevron’s comprehensiveprocurement, socioeconomic develop- safety training, which includes safe-ment, ownership/shareholding and work practices, hazard assessment,management. equipment training and many other elements. Contractors participateThe company was recognized for its in our Fitness for Duty program,commitment to transformation in which confirms their ability to safelythe country. A 2011 independent BBBEE perform essential physical andaudit by Empowerdex found Chevron cognitive requirements of the jobSouth Africa to be one of the lead- Above, from top: Bongani Zuma and Thembakazi without risk to themselves, others or Sidumo are learning welding and other skillsing companies redressing historical the environment. And a safety “boot through a Chevron partnership with the govern-imbalances in the petroleum industry. ment and community organizations to provide camp” is held for contractors onChevron South Africa places a strong training in skills needed for the oil, gas and the day work begins.emphasis on capacity building through chemical industries.proactive recruitment, development, To meet the trainees, watch the video at Turnarounds are very visible tocoaching and internal promotion Chevron.com/CR2011/SouthAfrica. the local community. Many peopleof people from diverse backgrounds. approach Chevron asking for the opportunity to work, but very few have the basic skills necessary for26

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