The West Bakr facilities were first commissioned in 1980 prior to the introduction of Law 4 of 1994. Developments that have occurred post 1994 have been developed and approved under the Egyptian Environmental regulations, Law 4 of 1994. Additional environmental assessments have occurred on a well by well basis as new discoveries have been made along with the respective wells being introduced. At present, West Bakr has established an HSE policy and operates an integrated health, safety and environmental management system organized and certified to comply with ISO14001 and ISO18001 standards. The West Bakr ESMS covers roles, responsibilities, risk assessment procedures, environmental aspects identification procedures, objectives and programs, training, communication and control, emergency response and incident investigation, auditing, corrective and preventative action procedures, permit to work processes and procedures, contractor management and monitoring and measurement. HSE handbooks are supplied to all staff and contractors in both Arabic and English languages.
Petrodara (West Gharib concession) operates an ESMS and has an established HSE Policy consistent with the requirements of the Egyptian General Petroleum Corporation (“EGPC”) the Egyptian national oil and gas regulator and 50% owner of the joint venture operating companies. The management system also covers aspects outlined above, although is generic to EGPC operations. Consequently, Petrodara are currently reviewing the existing ESMS. Given the proximity of Petrodara operations to West Bakr, TransGlobe is seeking to harmonize the two management systems and is also seeking to certify the Petrodara management system to ISO14001 and ISO 18001 during 2013. The revised management system is subject to EGPC review.
Both Petrodara and West Bakr have full time HSE managers with supporting HSE teams who report to the respective Field General Managers. As outlined previously, asset expansion and drilling activities which have occurred after 1994 have been assessed and approved against Law 4 of 1994. Exploration activities undertaken by TransGlobe to date have been approved by the Egyptian environmental regulator (the “Egyptian Environmental Affairs Agency” or “EEAA”) prior to the commencement of all drilling activities.
At the corporate level, TransGlobe has established an HSE policy which is subject to periodic review, covering health and safety in the work place and environmental protection. The corporate HSE manager, located in Cairo, monitors TransGlobe operated assets and reports directly to the Egypt country manager. TransGlobe develops an annual HSE plan identifying objectives for the coming year, along with KPI’s and financial and personnel resources specific to those objectives. Objectives for 2012 included the commencement of the ISO certification of the Petrodara ESMS, implementation of an HSE Tour schedule to be undertaken by senior TransGlobe management, instal
lation of driver monitoring systems for Petrodara and West Bakr vehicles, the review of the contractor HSE performance, and corporate wide HSE knowledge management and dissemination.
TransGlobe has established a reporting and monitoring system that starts on location with field staff and is documented and reported throughout the organization up to and including quarterly reports prepared by the HSE Manger in Egypt and delivered to the full Board of Directors by the Chief Operating Officer. Reporting directly to the Country Manger in Egypt, the HSE Manger is responsible for the development and implementation of the Company’s HSE policies and procedures in Egypt. In addition to the regular reporting, an emergency response plan is in place to report and if necessary respond to environmental or safety issues as they arise in the TransGlobe operated properties and offices, and non-operated properties which TransGlobe has an interest. Minor localized drills have been enacted to test and improve the emergency response performance. The TransGlobe Cairo Managers include the Country Manager, the HSE Manger, the General Managers of the Joint venture operating companies and the Operations Managers.
The reporting system for operated assets and properties includes i) daily HSE reports as sent from TransGlobe operations to Cairo and Calgary, ii) weekly review meeting for Management Team including review of HSE actions and bi-weekly video conference between PD and Calgary, iii) monthly meetings are held in the field with the Field Managers to discuss the coming month’s HSE issues and initiatives, iv) dedicated Contractor meetings are held to engage the significant 3rd party workforce to communicate and reinforce the Company’s HSE commitment, v) quarterly meetings are held in the field/ or Cairo office with the field Managers and the Cairo Managers to review and discuss the quarter’s HSE issues and initiatives, vi) a formal Quarterly HSE report is prepared in Cairo and forwarded to Calgary, vii) a Quarterly HSE report is prepared by the Company Chief Operating Officer and presented to the TransGlobe Board of Directors every Quarter, viii) the Company contracts 3rd party consultants to conduct Environmental audits (on acquisitions) and periodically as appropriate, ix) senior staff from Cairo and Calgary are encouraged to take frequent trips to the field to reinforce and support the Company’s commitment to HSE, x) the Chief Operating Officer typically meets quarterly with the Cairo staff to discuss HSE reports and goes to the field at least twice a year. The Company has also conducted two Board of Director field trips to West Gharib over past 3 years since acquiring the producing assets.
With regard to the West Bakr and Petrodara assets, and as outlined previously, the existing ESMSs are implemented at the respective Company operating levels. Given the ownership history of the assets the respective management systems have been developed on an asset by a
sset basis in isolation and/ or referencing previous corporate HSE philosophies. Consequently there is some variance between these systems. As part IFC’s financing, and included within the TransGlobe 2013 HSE plan, the Company have allocated financial and personnel resources to revise corporate level policies and develop a corporate level ESMS specific to the TransGlobe E&P business. The Company will also review existing policies, procedures and systems and augment where necessary to ensure consistency with IFC’s Performance Standards. TransGlobe will engage a qualified third party consultant to develop this corporate ESMS, which will be finalized within a timeframe agreed with IFC, to ensure an enhanced level of continuity across the TransGlobe portfolio. The ESMS will ensure the Company’s individual projects are constructed and operated in a manner consistent with host country requirements, IFC’s Performance Standards and good international industry practice as detailed in IFC’s Environmental, Health and Safety Guidelines.
The TransGlobe ESMS will require that ESIA’s are undertaken at an appropriate stage in the project development cycle, such as during exploration campaign planning or parallel to a Front End Engineering Design phase of asset development. For prospective farm-in activities or acquisitions, TransGlobe will undertake an environmental audit that is consistent with IFC’s Performance Standards. For subsequent TransGlobe field development activities, an Environmental and Social Management Plan (“ESMP”) for each new project activity will be developed, setting out: i) measures to mitigate adverse direct and cumulative impacts, including impacts arising from associated facilities; ii) monitoring requirements for ensuring the mitigation measures are implemented effectively and in a timely manner; iii) organizational and financial resources for carrying out the measures; iv) an implementation schedule for these activities; and v) an appropriate incentive structure (including provisions for reward and penalties) to ensure plans are implemented. The ESMP will vary according to the circumstances of the individual project, but will contain at a minimum, an emergency response plan, a spill control and response plan, a waste management plan, and a stakeholder engagement plan and community grievance mechanism. In the instance where TransGlobe proceeds with the acquisition of an existing or greenfield development opportunity, the target acquisition company would eventually operate under the TransGlobe ESMS following a period of reasonable transition.
Site specific pollution prevention and mitigation measures associated with future projects will also be identified during ESIA development. The Company will, as part of a project ESMP, develop procedures to ensure that the environmental impacts associated with the construction and operation of its projects is managed in accordance with IFC’s Performance Standard 3 (Resource Efficiency a
nd Pollution Prevention) and applicable EHS Guideline provisions. Similarly, TransGlobe will continue to develop all future project assets in accordance with good international industry practice.
In line with this, for all projects supported by IFC funds (‘Applicable Projects’) the corporate ESMS will require the review of existing ESIAs or equivalent documents. Where there may be gaps between the requirements of the Performance Standards and the Applicable Project, TransGlobe will prepare a supplemental environmental and social action plan aligning the project with Performance Standards and Guideline requirements. Where TransGlobe is not the operator of an Applicable Project, it will use reasonable endeavors to direct the application of the IFC’s Performance Standards to the ESIA. Similarly, for the Company’s operated producing assets at West Bakr and West Gharib, TransGlobe will undertake field wide Environmental and Social Impact Assessments (“ESIAs”) ahead of any future expansion activities consistent with host national requirements and IFC’s Performance Standards. The ESIA’s will be undertaken by third party, independent qualified consultants and will assess both the planned expansion activity and consider the field-wide cumulative impacts supported by primary and secondary baseline data. An Environmental and Social Management Plan (“ESMP”) will be developed, consistent with the previously described requirements of the corporate wide Environmental and Social Management System (“ESMS”).
Site specific biodiversity protection measures identified during any project ESIA will be implemented by the project’s HSE team. The TransGlobe ESMS will require a project to assess, avoid and where avoidance is not possible mitigate material impact, if any, on threatened species of flora and fauna. The ESMS will require all project ESIAs assess the impacts arising from supporting linear infrastructure consistent with PS6 including, but not necessarily limited to access service roads and onshore/ offshore oil and gas pipelines; develop and implement construction demobilization and landscape restoration plan detailing a systematic restoration of the project area landscape following the completion of all civil works and the evacuation of construction sites, including muck disposal sites and borrow pits for civil works, material lay down areas and labor camps.
With regard to farm-in opportunities or asset acquisitions, the TransGlobe ESMS will consider the E&S management of future assets to be developed, explored and/ or acquired by the Company. TransGlobe will: i) screen projects for HSE risk; ii) review assessments for completeness and consistency with IFC’s Performance Standards and EHS Guidelines; iii) identify the need for supplemental studies; iv) undertake the supplemental studies, appropriate update of existing EIAs and/ or undertake ESIAs in accordance with IFC Performance Standards; v) undertake regular project audits during construction
to assess status of implementation of the project specific ESMP and implementation of corrective actions identified in the previous audit; vi) undertake annual audits to assess effectiveness of the corporate ESMS and status of implementation of corrective actions identified in the previous annual ESMS audit; and vii) build the capacity within the Company for corporate-wide HSE management. TransGlobe’s corporate HSE Manager and the HSE staff assigned to each project company will be responsible for ensuring that the ESMP and Corrective Action Plans are implemented by each respective project company throughout the construction and operation phases of a project.
Existing operated producing asset level management systems of West Bakr and West Gharib consider HSE performance and oversight of contractors and sub-contractors. TransGlobe will review these current practices against TransGlobe ESMS requirements ensuring procedures are implemented for: i) contractors deployed by each project company meet relevant provisions of TransGlobe’s ESMS and ensure implementation of the ESMP as applicable to their respective activities; ii) HSE training of TransGlobe employees and contract labor; iii) procedures for recording, investigating, reporting and undertaking corrective action in relation to HSE incidents including those involving contractor and sub-contractor labor; iv) periodic monitoring of HSE performance; v) management review of ESMS effectiveness and implementation of measures for system upgrade; and vi) continue the practice of regular reporting of HSE performance to TransGlobe’s Board of Directors, regulators and investors.
TransGlobe’s assets are located in a variety of sparsely populated locations. Whilst it is considered unlikely that physical resettlement or economic displacement will occur as a result of current activities, TransGlobe will develop formal procedures as part of its ESMS to ensure compliance of its project companies with the applicable host country requirements as well as IFC requirements for the management of land acquisition, resettlement, and livelihood restoration of project-affected people. Should resettlement or economic displacement occur in the future, households and/ or businesses will be compensated at market rates.
TransGlobe’s individual operations currently plan and implement training programs according to the national regulatory requirements. These include the identification of workplace hazards; the use of personal protective equipment and collective protection equipment; the roles and responsibilities of employers and employees, induction programs; defensive driving programs; first aid and lifting management. TransGlobe also requires that employees and subcontractors have formal education and experience appropriate for the assigned functions and provides induction training covering aspects such as the technical competencies of the assigned work activity. TransGlobe will establish an internal communica
tions program whose objective is to disseminate corporate policies and practices starting with a standardized induction program covering HSE aspects relevant to the individual job description.