TCO representatives told how they see their potential contractors

Roundtable “Interaction of TCO contractors and subcontractors: synergy in production” gathered representatives of more than 40 companies in Atyrau.

Petrocouncil, established under the auspices of NCE Atameken and Kazenergy Association, organized a meeting between the management of Tengizchevroil LLP and representatives of Kazakhstani and foreign companies involved in the Future Growth Project and the Wellhead Pressure Management Project (FGP/WPMP) at the Tengiz field.

Deputy General Director – Murat Mukashev, opened the event reminding the importance of a constructive dialogue and thanking Petrocouncil for the organization of the meeting. Aidar Dosbaev, FGP Deputy Project Director reported the status of the FGP/WPMP project.

Selection and qualifications

So, what requirements does Tengizchevroil (TCO) set for its suppliers, and what is the process of selecting contractors?

As Local Content Analysis Coordinator at FGP/WPMP, Askhat Yergaliyev, said at the forum, in order to become a TCO supplier, the company must successfully pass the qualification assessment.

The main assessments include several stages:

a) Pre-selection of the supplier by the local content division with subsequent inclusion in the project database;

b) General qualification of the supplier by filling in questionnaires on general production capabilities;

c) Qualification assessment of special opportunities of suppliers in respect of a certain amount of work by filling in questionnaires.

“At the first stage, the company provides information about the company name, location, main activity and contacts. The contractor who has passed the first stage receives a questionnaire on general qualification assessment”, says Askhat Yergaliyev.

In turn, the general qualification assessment questionnaire consists of sections, which, in particular, clarify the general information about the company, its capabilities for labor protection, safetyand environmental protection. The general organizational, production capabilities and risks of the company are studied and evaluated. As a result, companies that have passed this stage are included in the list of potential contractors.

The list of potential contractors is used to identify potential contractors for specific types of work.

“The main focus of the process of special qualification assessment of the suppliers’production capabilities is assessing the knowledge gained from the experience of participation in large or small projects”, said the TCO representative.

The company’s ability to comply with regulatory requirements, the availability of appropriate licenses and certificates, the current workload and planning of the work process, local content development plansand the qualification of Kazakhstani employees are assessed.

Primary examiners perform an assessment of the company’s responses. And only after that, the company can be added to the list of bidders.

The most common reasons why enterprises could not be included in the list of suppliers were the following: lack of necessary information in the completed questionnaires, misunderstanding of questions and lack of feedback for clarification, as well as non-compliance with the requirements for health, safety and environmental protection. In addition, failure to provide full and clear information on existing licenses, etc., may prevent participation in the tender.

“If the company wants to re-qualify, it should contact the Kazakhstani Local Content Development Department of FGP/WPMP,” says Askhat Yergaliyev.

Kazakhstani content and training of local personnel

An employee of TCO Local Content Development Division, Napigolla Karimov, announced that the process for the development of Kazakhstani suppliers’ potential consists of 4 phases: planning, preliminary evaluation, trial order and final decision making.

For example, the company has worked on the development of one of the Kazakhstani contractors for three years: from 2015 to 2018; as a result, the latter became a supplier of FGP/WPMP.

“This is a Kazakhstani company that produces transformers, cables, various types of cables, including high-voltage ones,” said Napigolla Karimov.

At the same time, according to him, the opinion of TCO technical experts who evaluate the technical capabilities of potential suppliers plays an important role in the development of Kazakhstani suppliers.

He also noted that Kazakhstani companies can count on the assistance of the European Bank for Reconstruction and Development (EBRD), which hires international consultants for suppliers.

In turn, the TCO Staff Training Manager, AssylbekNugmanov, said that the training of employees is carried out in more than 20 specialties that are in demand at the construction site of the FGP/WPMP.

“We do not conduct training ourselves, but we do control over the quality of training,” he says.

According to him, the budget for personnel training is included in the contracts of contractors. Therefore, the development and training of personnel is the responsibility of the contractor. At the same time, training is provided only for Kazakhstani personnel.

“Our task is not only to control the quality of training, but also to consult. And we consult not only contractors, but also local educational institutions how to develop further. Because we care not only about training and providing qualified personnel, but also about what legacy we will leave. So that a specialist trained at a local educational institution could participate in other projects in the future,”AssylbekNugmanov said.

He said that in the nearest future, the company is planning to hold a forum of suppliers, which will provide additional information on staff training.

Now in Tengiz

Meanwhile, according to the Deputy Director of FGP/WPMP, Aidar Dosbayev, about 1.5 thousand small and large contracting companies, which employ about 47 thousand people, are currently working on the implementation of the abovementioned projects in Tengiz.

He noted that to date, 90% of the engineering work in Tengiz is being completed, more than 90% of the procurement has been carried out, and that now the main work will take place in Tengiz.

“If we talk about the logistics, last year, we have tested all of the capabilities of delivery of pipe racks and modules, said Aidar Dosbaev and added – We expect that the delivery of all pipe racks from Yersai toTengiz will be completed this year”.

At the same time, he said, the climax of works on the project will last another three years.

In turn, TCO Deputy General Director, Murat Mukashev, noted that when choosing potential suppliers, the company primarily pays great attention to safety and proper organization of labor. Social responsibility of contractors is also important for the operator. In particular, the company wants its contractors and subcontractors to pay their employees fairly and on time. At the same time, TCO monitors how all these requirements are met by contractors.

“In general, I urge you to be more independent and not to think that if you signed a contract with TCO, it will provide you with everything. It is necessary to have your own business plan and stick to it,” Murat Mukashev said.

Where to get a certificate

Entrepreneurs who came to the forum were able to ask questions to TCO representatives. In particular, there was a question on how contractors could get a certificate that confirms they are suppliers of FGP/WPMP, which will allowtransfering goods across the border without payment of duty.

Tengizchevroil representatives replied that in order to obtain such a document, the contractor should send a letter to TCO. But the exemption applies only to direct suppliers of the operator.

Representatives of Zhigermunaiservice LLP complained that the local enterprise is now occupied by only 20%, that it could fulfill those orders that TCO gives to foreign or Kazakhstani contractors located, for example, in Almaty, that is a few thousand kilometers from Tengiz.   

Representatives of the operator said that they are well aware of the potential of Zhigermunaiservice LLP and will consider the possibility of cooperation with the company.

Concluding the meeting, the moderator of the forum and the official representative of NCE Atameken for cooperation with oil and gas operators, Assylbek Dzhakiyev, said that TCO is always prompt and willing to cooperate on issues of local content. He noted that the Oil and Gas Sector Strategic Partnership Development Council, Petrocouncil, will continue to organize meetings between major oil and gas operators and Kazakhstani companies – potential suppliers of oil and gas industry services.