Capacity Indigenous Group Presentation Apr15 Mike Kostashuk GoMentr

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CAPACITY BUILDING IN YEMEN: RESOLVING OIL EXPORT OPERATIONS

IMPACT ON INDIGENOUS GROUPS

An example from the south Yemen coast showing mechanisms available to oil and gas operators for

implementation of corrective, or compensating, partnership projects and developing industry with local communities.

30/04/2015 © Michael Kostashuk

230/04/2015 MikeKostashuk/FMPetroleum/Geo-Kay

Crude oil tanker in preparation for loading operations in protected coastal waters – exports are a visible source of economic benefit for the country, however, they are also a source of local fishing community discontent due to security measures. (Photo Credit: M. Kostashuk)

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BACKGROUND:1. Our projects had to align with corporate strategy to profitably operate crude

oil exports and resolve, or minimize, business conflicts with local groups in marine and inland activity in southern Yemen;

2. Indigenous groups affected by our operations should be engaged as potential partners in moving compensating projects forward;

3. Our company was to “lead by example”, including culturally appropriate interaction with a wider group of stakeholders – local fishermen, local government, university researchers, senior ministry officials, and NGOs;

4. Our work needed to leverage on previous efforts in order to increase collaboration with local leadership and to deal directly with the affected parties.


ABOUT THE AUTHOR: Michael Kostashuk, B.Sc. M.Ec. P.Geo. P.Geoph. PMP, has worked in the upstream oil and gas industry for over 30 years, and in leadership roles since the early-1990s. His experience in coordinating field development programs with indigenous groups started in the mid-1980s with First Nations seismic interface in Western Canada. Since that time Mike has engaged local tribes and national groups in the Middle East and Africa, as well as First Nations in Canada, to achieve project success with enduring endorsement from local stakeholders. Mike has worked in Project Management positions internationally on onshore and offshore facilities, with cumulative capital expenditures exceeding US$6.5 billion. He is an experienced sailor and scuba diver with offshore skills developed on Canada’s west coast, the Persian Gulf, Red Sea, and Gulf of Aden. Mike is currently a senior executive and operations leader for a small Canadian E&P company.

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• Loss of traditional fishing territory;

THE PROBLEM:As a result of deadly terrorist attacks along the Yemen coast, and the need for more vigilant small vessel control in the vicinity of tanker loading operations, a restricted marine security zone (of about 25 km2) was established in a popular fishing region. Consequently, local fishermen lost access to livelihood and faced increased costs and formalities in their daily activities. Individually, and in organized groups, the indigenous fishing community sought redress from the loss of portions of their traditional fishing grounds and restrictions in their vessel movements. The issues identified include:


• Limited access to shoreline, no access to Ash Shihr harbor facilities;• Restricted transit routes in the vicinity of the marine exclusion zone;• Increased threat level arising from “broadcast” of crude oil terminal significance to terrorist organizations and Gulf of Aden pirates;• Increased potential for accidental incidents involving fishing vessels and Yemen security forces in the region around the exclusion zone.

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1. COMMUNICATION! COMMUNICATION! COMMUNICATION!

KEY PARTS OF THE SOLUTION:

The most significant mitigation strategies to achieve success include:


2. EDUCATION

3. COLLABORATION

4. CAPACITY RECOGNITION

Simply telling the people what you wish to do and why you want to do it creates an atmosphere of mutual respect.

Educating and enlightening the local community is also a time for them to educate you as to what expectations, issues, and limitations they have.

Open the door to their considered expertise and participation in the project as you will find more synergies and eliminate suspicion/mistrust. Inclusion and cooperation are required elements for successful project implementation.

Following the successful implementation of your project continue to build the relationship, and utilize their new capacity, through seeking applications beyond your own operations. This will also open the door for the local group/company to begin their own marketing strategy.

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December 1992 – Al-Qaeda attack on the Gold Muhor Hotel in Aden (2 deaths – reportedly the first deadly Al-Qaeda attack in history);October 2000 – Al-Qaeda attack on the USS Cole in Aden (17 US military deaths + 39 injuries + destruction caused by suicide bombers);

October 2002 – Al-Qaeda attack on French crude oil tanker Limburg off the Ash Shihr Terminal (1 crew death + destruction caused by suicide bombers);

September 2006 – Al-Qaeda attacks the Ash Shihr Terminal (1 contractor death + destruction caused by suicide bombers);

CHALLENGING ENVIRONMENT:The coast of southern Yemen on the Gulf of Aden is a dangerous region both onshore and at sea. Given a history of Al-Qaeda attacks, intertribal conflicts, and pirates operating offshore, the local residents and marine operators face significant threats:


April 2015 – Port of Aden closed due to attacks and occupation by Al-Houthi rebels , Port of Mukalla (about 25 km from Ash Shihr Terminal) falls to Al-Qaeda in the Arabian Peninsula (AQAP).

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Aftermath of the October 6, 2002, suicide bombing of the French-flagged crude oil tanker “Limburg” at Ash Shihr (also called Al-Dhaba) export terminal on the Yemen coast of the Gulf of Aden. For scale, the Limburg, with the stern superstructure and stack visible on the lower right, is about 330 m (1080 ft) in length, hence the oil slick and fire zones are several kilometers across.

(Photo Credit: Security Employee)


Suicide attack in the operations area of the crude oil loading terminal. Crude oil tanker “Limburg” was manoeuvring in the vicinity of a crude oil loading buoy when it was attacked with a bomb-ladden fishing boat.

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• Prohibited zone for fishing over about 25 km2 around the terminal and loading buoy anchorage zone;

CREATION OF A MARINE EXCLUSION ZONE:

The operator of the Ash Shihr Terminal, in cooperation with the Yemen Coast Guard and Ministry of Oil and Minerals, created a sizable exclusion zone to enforce security and access control around the crude oil loading buoys and harbor. This zone caused local fishing communities to alter their established practices as they were denied access to portions of traditional fishing grounds.


• Restricted transit zone for fishing and small cargo vessels paralleling the shoreline between the exclusion zone and export terminal facilities;

• Patrolled by armed Yemeni military craft and strictly enforced when crude oil tankers are approaching, moored, or departing the exclusion zone.


Typical single-point mooring (SPM) buoy for crude oil loading operations. Ash Shihr Terminal had two SBM-manufactured SPMs in operation for most of the time period the security exclusion zone was enforced. Fishing was prohibited over a significant area surrounding the buoys.

(Photo Credit: M. Kostashuk)

SPM Buoy

Crew/Work Boat

Tanker Mooring Lines (2)

Crude Oil Loading Lines (2)

Loading Line Handling Boat

Single Point Mooring Loading Buoy System

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• Artificial Reef (AR) constructed from modified and environmentally prepared shipping containers.

Placing steel boxes in a suitable pattern to simulate a reef, and attract reef-building, on the seabed.

ALTERNATIVES FOR BUILDING ENHANCED FISHING AREAS OUTSIDE

OF THE EXCLUSION ZONE:The terminal operator developed a number of viable alternatives for construction of enhanced fishing areas in order to compensate for the loss of exclusion zone fishing.


• Artificial Reef (AR) made with concrete reef balls or blocks, locally constructed. Installed with specialized (outside contractor) placement vessel.

Building specialized forms and installing heavy precast concrete to simulate a reef, and attract reef-building, on the seabed.• Fish Aggregation Device (FAD) constructed locally and

installed with locally-available vessels. Building and anchoring a small buoy equipped with rafts

attached at various submerged levels in order to form a suitable fixed-location fish habitat.


Twenty-foot shipping containers prepared for artificial reef installation in shallow water adjacent the terminal exclusion zone. (Photo Credit: M. Kostashuk)


Typical small footprint reef ball installation with established multiple species coral growth apparent.

(Photo Credit: Reef Ball Foundation @ reefball.org)

http://www.reefball.org/album/turksandcaicos/beachesresortproject/index.html

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FAD buoy and submerged raft being prepared for anchoring and deployment. In a typical installation fish gather under and around the multiple-layered rafts suspended beneath the buoy.(Photo Credit: M. Kostashuk)


FAD Buoy

Submerged Rafts (undeployed)

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• Artificial Reef (AR) constructed from modified and environmentally prepared shipping containers:1. Low cost and readily available material made this the least expensive

project;2. Steel structure AR installations were seen as hazardous, and potentially

polluting, by local fishing groups. Limited opportunity for maintenance work;

3. There was an issue with local collaboration and capacity development as the indigenous community did not see much benefit arising through the simple process of container modification and installation.

RESULTS OF PROPOSAL EVALUATION FOR ENHANCING LOCAL FISHING:

Further to over four years of interaction and collaboration with local communities and government representatives the terminal operator summarized conclusions for the viable alternatives as follows:


• Artificial Reef (AR) made with concrete reef balls or blocks, locally constructed. Installed with specialized (outside contractor) placement vessel:1. Due to the requirement for specialized cement for the concrete, and

advanced moulding techniques, the operator considered this challenging for the local community;

2. The cost for a sizable AR was prohibitive given material and installation requirements;

3. High maintenance demand given the limited availability and capacity of local divers.

• Fish Aggregation Device (FAD) constructed locally and installed with locally-available vessels:1. FADs proved to be a moderate cost installation project and within the

existing capacity of the local fishing;2. Offsetting coastal FAD installations proved to be economically viable

and popular with the fishing community;3. Maintenance and monitoring capacity was already established within

the community through existing boat repair and operations expertise.

X

X

√

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THE RESULTS:

Locally built and installed fish aggregation devices were successfully deployed at select locations along the coast:


1. ENGAGEMENT AND COLLABORATION - Once the alternatives were set out by the operator, and additional consideration given to options (including combinations of various alternatives), the parties agreed to a project charter in which the fishing community could compare expected results with their experience;- Project duties and resources were mapped in collaboration with local providers. 2. DESIGN - Raft dimensions, construction materials, and deployment layout were determined according to fish species and materials availability;- Construction plans were optimized in order to allow local contractors to build and maintain (installed) FADs;- Local capacity development and logistical coordination was taken into consideration.

3. CONSTRUCTION - Building the buoys and rafts as fit-for-purpose, in a renewable process, was completed;- Preparation and installation planning was coordinated throughout the construction process.

4. INSTALLATION - Using locally available vessels and fishing community knowledge the FADs were deployed in preferred locations with the supervision of fishing and community experts.

5. MAINTENANCE - Local fishermen were contracted to maintain and observe FAD utilization.

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FAD buoys and partially assembled fish attraction rafts prepared for installation.(Photo Credit: M. Kostashuk)


FAD Buoys

FAD rafts stacked for installation

Floats

THE RESULTS:

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THE CONCLUSION:

A successful implementation of a compensation project that included local participation and resolved some long-standing issues with the local fishing community:


ECONOMIC: we achieved a low cost solution to a persistent issue

COMPENSATING: local fishing communities reportedly realized about $500,000 annual value per FAD in increased catch as well as developing a new business model for local manufacturing

COLLABORATIVE: the operators involved in FAD projects and the local fishing communities increased their respective awareness and level of trust in working with each other through the projects

COMPLETE: the multiple FAD projects yielded a “win-win-win” scenario for exporters, fishing communities, and the respective governments involved

Documents

Capacity Indigenous Group Presentation Apr15 Mike Kostashuk GoMentr