Aksai, Western Kazakhstan Oblast, 6 February 2008: Karachaganak Petroleum Operating BV (KPO) successfully cooperated with both the International Finance Corporation (IFC) and the Office of the Compliance Advisory Ombudsman (CAO) in agreeing an action plan, which will serve to close previous audit findings.
During a recent site visit, a CAO Audit Team assured itself of Karachaganak's compliance with applicable IFC environmental requirements on a majority of the issues identified during the previous audit. It is expected that all outstanding actions will be completed by April 2009. This will mean that Karachaganak is fully compliant with applicable IFC requirements.
It is important to note that the 2008 Audit Report delivered by the CAO was not a review of KPO's environmental performance, nor was it a review of how KPO has complied with relevant legislative requirements.
The previous Audit reviewed the way in which the IFC has assured itself that the relevant guidance, as specified in the loan terms, had been complied with by the borrower at the time the loan was made, which in this case was LukOil, a partner in the Karachaganak Venture.
Speaking about this development, KPO General Director, Roger Fox stated: "We are very pleased to have been able to support the IFC and CAO in agreeing to close out the previous CAO audit in less than a year. The outstanding actions are primarily points of clarification and comparison and once complete, will definitely illustrate our compliance with relevant IFC environmental standards enabling the CAO to be assured of KPO performance."
"KPO is committed to the highest standards of environmental performance and over the last three years we have seen significant reductions in emissions and increases in gas utilisation rates. Of the producing oil and gas fields in Kazakhstan, we have the highest gas utilisation rate at some 99.78 per cent. This means that almost all of the gas which we produce is utilized in some way - it is either injected, sold or utilized as fuel gas."
KPO's commitment to meeting international standards in environmental management is clearly demonstrated by the Company's voluntary use of innovative technologies to reduce emissions. The recent implementation of the international ISO 14001 standard and the development of a five year strategic Health, Safety & Environment (HSE) plan, will further deliver noticeable improvements in KPO's HSE performance.
Karachaganak Petroleum Operating BV (KPO) is a joint venture, which oversees the expansion and development of the Karachaganak field - one of the world's largest oil and gas condensate fields, located in North West Kazakhstan.
In developing and operating such a technically complex field, environmental protection and safety are critical success factors. Our recent performance has helped both Karachaganak and the Republic of Kazakhstan to be recognized amongst the leaders in oil and gas health, safety and environmental performance.
While safety is a key focus area, we also aim to develop and market hydrocarbons from Karachaganak in an environmentally sound manner. Enhancing hydrocarbon utilization, efficient use of water resources, the reduction of emissions and hazardous waste and eliminating spills and leaks are all key elements of Karachaganak's environmental improvement program.
The Office of the Compliance Advisor Ombudsman (CAO) is an independent body that reports directly to the president of the World Bank Group. The CAO reviews complaints from groups affected by development projects undertaken by the two private sector lending arms of the World Bank Group: the International Finance Corporation (IFC) and the Multilateral Investment Guarantee Fund (MIGA).
