– How has COVID-19 impacted realization of NCOC Local Content objectives?

– It is true that COVID-19 pandemic has impacted every sector of economy worldwide. NCOC had to make adjustments to its ways of working too. However, despite the challenges, we continue most of our activities as planned.

As you know, NCOC has developed a long-term Local Content Program to identify market opportunities and raise local capabilities to the benefit of our Kashagan project and any other projects in Kazakhstan or internationally.

In the first six months of 2020, our Company has spent about 50% of the annual budget on local goods, works and services. Here, I would like to mention our initiative to shorten the payment terms (from 42 days to 21 working days) for contractors registered in the RoK during the emergency and quarantine periods in the country. Thanks to this initiative, local contractors could receive payments earlier than specified in the contract documentation. This task was cascaded to Subcontractor level too.   

Our Local Content activities continue at the same level. These include technical gap analysis and assessments, certifications to international standards and trainings. Our negotiations with Original Equipment Manufacturers in respect of localization of their products successfully completed with Emerson LLP, General Electrics, Flowserve and PV-KIOS committing to localize production.

NCOC’s “Early Tenders” initiative is also producing positive results. We have awarded 3 contracts to local manufacturers year-to-date, and a number of other tenders are at different stages of preparation.

Also, recently we launched a ‘Single Window’ form on NCOC web-site (www.ncoc.kz) for managing all external requests related to LC, VQD and C&P, including those coming from suppliers, potential bidders, etc. This is a great tool for any company to send its query and get response from an appropriate party (department) in NCOC. We expect it to enhance the communication between industry and Company.

Apart from Local Content development, we progress with our committed social projects in Atyrau and Mangystau regions. Our overall investments in social and infrastructure projects since 2004 already exceeded $700 mln and this work will continue.  

– Was there any impact from COVID-19 and global decline in oil demand on NCOC production operations?  

– NCOC is firmly committed to maintain the government-supported level of oil and gas production during the quarantine period in the Republic of Kazakhstan.

We are constantly monitoring the developments on COVID-19. We have analyzed various possible scenarios that may affect our personnel and production. For each of these scenarios there is an emergency preparedness & response plan and business continuity plan to ensure maximum protection of NCOC and contractor personnel. Other parts of these plans help ensure that safe business operations, including production, will be maintained as appropriate during an outbreak. 

The Company is following its production plans endorsed by the RoK Government and shareholders. At present, our production activities meet the production schedule (Oil export has exceeded 73.3 million barrels, Gas export has exceeded 2.1 billion Sm³, Sulphur export has exceeded 742 thousand tonnes). And overall production reliability of our assets remains very high.  

– COVID-19 has affected many businesses in Kazakhstan and worldwide. What measures is NCOC undertaking to ensure the virus spread does not compromise an integrity of your operation sites?

– As I said earlier, we are monitoring the COVID-19 developments and continue working to respond to the evolving situation. NCOC places the highest priority on the health and safety of our workforce, including our employees and contractors and their families, and on the protection of our assets and the environment where we operate and live. We continue our operations in a safe and responsible manner, as we always strive to do, although with some modifications triggered by the current epidemiological situation. 

We coordinate all our activities with the Regional Emergency Operations Team led by the Oblast Akim in strict compliance with the RoK President’s Decree. There are enhanced sanitation measures implemented with the access to Company’s sites being restricted.

Access to our operating and front line sites is strictly restricted for key personnel. The access is granted on the basis of successfully completed 14 days quarantine for offshore staff and 10 days for onshore staff and negative PCR test on the 8th day for both offshore and onshore staff. 

Also, we have  implemented the “pod” (compartmentalization) concept at our operational sites which is compartmentalizing work teams (i.e. formation of “clusters” and “pods”) to further limit interaction and risk of wide spread infection. This is a supplemental level of control being used in addition to social distancing/hygiene measures to reduce transmission of COVID-19 and maintain business continuity.

NCOC was one of the last companies in Kazakhstan with no COVID-19 cases at the front line. Of course, we did not expect this to last forever. Currently, there are 70 confirmed COVID-19 cases at NCOC sites. It should be noted that the first case in operational sites were registered in July. These people are placed in a special provisional facility to receive medical treatment. We will continue our very aggressive testing and treatment strategy to keep our people and our business protected.  Also, all NCOC employees have medical insurance provided by Company as additional benefit to get required medical support.

– NCOC was one of the first companies in Kazakhstan who stood along with local communities in their response to covid-19. Can you tell us about your Company’s support to local healthcare in Atyrau and Mangystau regions?

– NCOC has been closely cooperating with regional authorities, government and other partners to support local healthcare system since the early days of COVID-19 pandemic. 

Starting from March, NCOC has been providing essential life-saving medical equipment to the healthcare facilities of Atyrau and Mangystau regions. These include lung ventilators, multi-purpose hospital beds, defibrillators for intensive care units of hospitals for infectious diseases of two regions, medicine and personal protective equipment for medical staff, ambulance vehicles, etc. So far, our Company has spent over 3 billion tenge on direct assistance to the healthcare system of Atyrau and Mangistau oblasts. 

Moreover, the Company volunteered to support several initiatives where physicians are invited from around the world to Atyrau to support the local medical system. 

Apart from the healthcare system, NCOC has also decided to support local schools by delivering 1,200 surplus computers for children from low-income families.

As struggle with COVID-19 is not over yet, NCOC continues to support people of Atyrau and Mangystau regions in their battle against the pandemic.

– Thank you for you answers