Over the past 33 years, Staatsolie has developed from a grass-roots operation into an integrated oil company that continually contributes significantly to the Surinamese economy. In July this year they were awarded Well Services Petroleum Company Limited (WSPC) from Trinidad & Tobago, for the contract to drill nine exploration wells in near shore Block 4, off the coast of Saramacca.

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We spoke with Mr. Rudolf Elias, current incoming Managing Director of Staatsolie who has been a decisive influence in this industry for many years,

“I have been with Staatsolie for six years now,” he says, “And before then I worked with BHP Billington where I was vice president of development. When I came to Staatsoolie it was as business development director,”

He explains he was in charge of new projects especially with green energy and renewables such as ethanol, hydro-projects and corporate planning. In 2010, he was put in charge of the largest project they had the time a refinery expansion programme, “It was a complete new refinery upon an existing operating refinery,” he says, “A year later I became director of refinery and marketing and was also responsible for downstream energy and power generation.”

Then in February 2013, shareholders appointing Mr. Elias as incoming managing director.

StaatsolieNow, the Republic of Suriname, with its capital city Paramaribo,

is located just north of the Amazon delta on the northeast coast of South America. Virtually un-explored, there are only 22-exploration wells drilled in this area that covers approximately 150,000 square kilometres. Bordered in the north by the Atlantic Ocean, in the west by Guyana, in the east by French Guiana and in the south by Brazil, Suriname is covered by tropical rain forest and remains thinly inhabited.

Even three decades ago, Staatsolie set out to accomplish great things, commercially, while not disrupting the local population, which comprises of a rich ethnic blend of approximately half a million inhabitants. Although the official language is Dutch, English is widely understood and spoken. Suriname is a parliamentary democracy and has an elected President heading the Government.

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This advancement came about after 2D and 3D seismic surveys conducted in 2012 showed potentially recoverable oil reserves in the block. The contract was signed on Friday 18 July, in Paramaribo, so we contacted Staatsolie for an interview as we were seeking to highlight a company with a strong ethical and employee-centric approach to business in this sector and could think of no better company to approach.

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+ Valve Insertion

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Although also involved in the retail, gold mining and energy sectors Staatsolie is keenly focused on petroleum, the systematic search for which began in the early sixties. It took a major leap forward after 1980 with the setup of Staatsolie and contracts were introduced for private companies to participate in the production and refinement of the products. The country was no stranger to this sort of attention, as they had already played host to mineral miners since the early sixties.

StaffingA staff contingent of 1042 directly employed professionals work

at Staatsolie and are supported by a further 600 people who are engaged with the business as contractors. All staff are required to adhere to the Company Code of Conduct and the key company standards, that are as diverse as the ISO 9001 quality norm, safety standards and procedures as documented in their General Field Instructions. Familiarisation with these and other standards, policies and procedures mainly takes place during the induction period, conducted soon after joining the organisation.

Mr. Elias says that when he joined there were many efficient procedures in place that had been set by employees who had experience in other industry giants such as BPH Billington which had

been adapted to suit Staatsolie, but what really impressed him was the loyalty of the staff, “They love the company,” he says, “And are very dedicated and will do everything it takes in order to make the company grow. You don’t get that sort of feeling unless a company deserves it.”

Speaking with the management at Staatsolie, it becomes very apparent that staff development is extremely important to them. With a sizeable training budget and a liberal approach to granting training requests, their team has become one of the most qualified and expert in the field. Training takes place in the classroom, as well as in one-to-one sessions conducted both in-house and beyond their premises. Training is always developing and the company is currently in the process of designing a management development program.

Staatsolie’s People Vision marks employees as key to their success and the company invests heavily into their development by giving them opportunities to develop their potential and further play their part in reaching the company goals.

Although the worldwide scarcity of specialists, such as drillers and engineers, does pose a problem to the industry in general, Staatsolie look at this as more of a remuneration hurdle. They claim to now find it too difficult to identify and contract skilled people in most of their areas of business and as most of their workforce is predominantly composed of Suriname nationals, it is a credit to their training and the education system that is available.

Staatsolie shows its social engagement by supporting projects for sport, culture, education, healthcare, senior citizens, people with disabilities and youths. Additionally, sustainable community projects are supported through the ‘Staatsolie Foundation for Community Development’. In the past 5 years Staatsolie donations to the community topped more than US$ 12 million.

Staatsolie’s approach to their staff and community is a direct reflection of how well they treat their customers and their business model further enforces the importance of developing long-term relationships based upon open communication and an appreciation for all feedback. They make quarterly visits to local customers and conduct yearly customer survey’s for their international affiliates.

“Regular and honest appraisals about how well we are doing, as a company, is important to continue heading in the right direction. You need to know where you stand in the scheme of things.”

Quality has always been the anvil upon which all the other elements of Staatsolie are hammered and implementing the handling of clients and customers post-sales is just as important as initially securing their custom. A team of internal experts, working in technical, laboratory and inspection areas, are on hand at short notice to deal with any customer queries and complaints are merely queries that haven’t yet been dealt with effectively and quickly.

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CompetitionStaatsolie have grown in last five years from a 400 million dollar

company to a billion dollar company and with such growth Mr. Elias sees the need for the organisation of the busy to change to accommodate it, “I see us growing more decentralized with assets,” he says, “Currently we’re very centralized but are outgrowing that. In the downstream and upstream we have prominent assets and this continues to grow every year and it becoming harder and harder to run as a centralized organisation.”

He goes on to explain that over the last ten years, in an effort to diversify in light of the oil price flux, that they invested a lot in downstream, but in the coming five years that he would like to focus on developing the upstream in order to boost production from sixteen to eighteen and then twenty thousand barrels of oil per day.

SuppliersThe quality of service provided is totally dependent on the

quality of companies that Staatsolie choose to work with and with this in mind, they are highly selective in their choice of suppliers. Staatsolie explain that their scope of operations is quite diverse and so the list of suppliers varies from project to project,. What remains static however is that every project above US$20,000 requires a

selection of at least three contractors who are chosen in accordance with the specific requirements of said project. There is a select group of contractors who are closely related to production and exploration drilling processes with which they work continuously.

A balance has been found between the pool of available local and international suppliers and the quality that Staatsolie have built their reputation around. As an example, they point out that as the suppliers are contract specific and the maximum contract duration is three years, that procurement will bring in new, qualified and competitive suppliers to keep the pool of partners as fresh as possible. Contractors are rated against several criteria, which supports sustainability. For example, they have to adhere to the Contractor Management Guidelines, which includes criteria for their financial situation, their HRM policy and HSE policy and procedures. Staatsolie supports small local contractors to understand the criteria and implement the necessary systems and procedures to win tenders.

As a major player in their industry, Staatsolie have accepted the mantle of being a responsible company, investing a great deal of time and money into a series of ‘green initiatives’, which have made them as much a player in this industry as they are in petroleum.

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Ethanol interestsIn December 2010, they commenced with an ethanol pilot project

at Wageningen in the District of Nickerie. 13 selected varieties of sugarcane from Brazil and Guyana were planted and tested for their suitability in local soil and weather conditions and the pilot results were above expectation. Based on the pilot study, the solution and definition study was carried out and an Invitation To Bid (ITB) was prepared for agriculture land development and EPCC of the processing plant. In line with their standards, an environmental and social impact study was carried out, based on international standards, and this study indicated a minimal and negligible environmental impact. This was simultaneous to suggesting a significant positive social impact, leading to the project being executed in a more phased manner in the coming years.

AlgaeParcIn February 2011, Staatsolie became a member of the

BiosolarCells Consortium, consisting of 35 world-class companies in the food, energy, pharmaceutical and chemical industries. The Consortium aims to conduct research and development relating to the optimisation of photosynthesis in plants, for use in biofuel production and the productivity of (micro) algae for use as biofuels. The research is being conducted by the Wageningen University in the Netherlands and will be completed in June 2015. To date, the most productive algae species and the most efficient bioreactors for the intended purpose are identified and with the rights to all information from this project, Staatsolie could consider conducting a feasibility study, based on the local conditions, with partners.

SolarSolar Energy has been identified as a promising renewable energy

source for Suriname, however, little research data is available on the potential. Staatsolie therefore initiated a solar pilot project, with the objective of gaining insight into the collection of energy production data of the PV System and experience with respective solar energy system design, construction, operation performance and integration with existing power systems. They would then collect data to validate the technical and economic feasibility for future application.

HydroThe first phase of the TapaJai Project entails the re-routing

of water from the upper- Tapanahoni River and the Jaikreek to the Brokopondo dam, resulting in the maximised utilisation of the Afobaka power plant. In following phases, also called the optimised phase, more electric capacity will be installed, resulting in an additional estimated firm capacity of 120 MW, available to the national electricity grid. To date, the solution study that identifies

the optimal project configuration from a technical, economic and socio-environmental point was completed only partially, based on government advice. The project however, remains in Staatsolie’s project portfolio, awaiting further government instructions

With constant investment into their growth, 2014 to 2018 will see Staatsolie’s investments total nearly US$2 billion. The new year is going to prove to be a busy and productive time for Staatsolie, with the commencement of a new refinery, a further investment of US$300 million into gold mining and the building of a new Ethanol and sugar plant.

The new refinery will significantly decrease Suriname’s dependence of the import of fossil fuel. The new products, especially diesel and gasoline, will be produced according to high international standards and Staatsolie will gain significant import earnings as exports will expand beyond regional borders, with French Guiana (France) being a highly lucrative export market.

On October 7th 2014, Staatsolie agreed to take over ta 25% share in the Merian gold project in West Suriname. This project will be carried out simultaneously with Suriname Gold Company LLC (Surgold), a subsidiary of Newmont. Staatsolie’s investments in this project are totalled at US$ 00 million and the first instalment of US$83 million has already been transferred to Surgold.

The US$300 million ethanol and sugar plant will produce, when in business, around 40 million litres of ethanol and 42.500 tons of sugar annually. Additionally, it will also produce 24 MW of electricity from sugarcane waste, which will be transferred to the local grid of EBS, the national electricity company of Suriname.

What is really exciting Mr. Elias however, is the monetary reward that will be felt for Suriname’s economy when his company begin drilling in near shore Suriname, “We will be drilling in front of existing oil fields, in near-shore areas with the hope of finding commercial oil there,” he says, “We will then bring it in to our treatment plants and refinery and this is expected to boost our production to in the region of 8000 barrels a day.”

Additionally, in 2015 Staatsolie is partnering with a number of large companies to drill four holes in their offshore area which is more than they have done in the last six years, “We are positive that at least one of these, if not all four will bear oil and if this happens it’ll be a complete change for Suriname.”

Such a discover would boost production to 80,000 barrels a day which would boost the economy in massive way, even if Suriname doesn’t actually see any of the oil, as one of the country’s primary revenue earners with Staatsolie generation in the region of 10% of the GDP!

“Staatsolie is in a perfect place to take our country onto a different level,” he says, “Any discoveries would take several years to properly impact but next year could be a very big step for us, so naturally we are very excited about the new year.”

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