First-Stage Pre-qualification Enquiry document
The three Operators (TCO, NCOC, KPO) submitted their existing “Lowest Level” pre-qualification enquiry documents to Secretariat for consideration by an independent Quantity Surveyor. A draft was presented to all stakeholders for discussion and agreement with the objective of the development of an approved version for use by Operators and EPC contractors when pre-qualifying companies for suppliers of goods and services. This would be an initial step in a process aimed at helping maximum engagement of Kazakh businesses by the use of this standard, more user-friendly documentation.
Operators accept and support the idea of simplifying the documentation process for their suppliers.Operators having reviewed the draft expressed that specific points be addressed:
- The document should include ethical, suppliers verification, technical parameters for different service types, and coding system that should be agreed for each product type.
- Agreement and support of governing authority (eg PSA) is considered imperative for the process
- There needs to be two/three months of detailed dicussion to advance the process
- Consider how assesment of companies be conducted, e.g. site-visits.
- Secretariat to collect comments/recommendations from Operators and other stakeholders to the first draft of PQQ Expiremental for ammendments to draft
Single Vendor Registrartion Database
Operators support the idea of the single vendor registration database, but it should be customized for Operators needs, requirements and parameters. Single Vendor Registration Database would help to simplify and reduce costs of suppliers search process. However, the database should become more than a 'telephone directory' and should serve the needs of all stakeholders to be effective.
The key to success of the Single Vendor Registration database is 'critical mass'. In addition to Operators support to use the database, willingness of suppliers to be on it is essential. There needs to be a clear understanding therefore of the benefits of a Single Vendor Registration Database.
Taking into account the proposal of Kazenergy to introduce Achilles and use First Point Kazakhstan as the Single Vendor Registration database and KPO’s& TCO’sexisting access to the system, NCOC has been offered access to the system in test- mode in order to see how the system works in practice.
- Secretariat to collect from Operators their input to the Single Vendor Registraion Database
- Kazenergy to present to Operators an Action plan, with timelines and mechanism of transferring from existing databases to single vendor registration system that is proposed by Kazenergy and Achilles jointly. This including:
- benefits for suppliers and tools to motivate users to join the system
- adoption to the FPK system of new modules such as performance feedback and companies assesment
- transfer of existing suppliers to the new IT platform and translation of the system into Russian language
- Achilles to review the PQQ Experimental document and make gap analysis with FPK prequalification system
Standards, Certification, Metrology
The Committee of Technical Regulation and Metrology of the Ministry of Industry and New Technologies of the Republic of Kazakhstan were invited to address the issue of matching local standards to international. The Committee presented their view on the Stages of modernization of the technical regulation in the oil and gas industry for period 2014 - 2015
As the first step there needs to be a comprehensive list of standards and technical documentation used by Operating companies that will show which of the existing local standards and technical regulations need to be adopted and changed.According to an analysis made by the Committee there is a lack of information from the industry and that existing technical committees are not working effectively.
It is felt essential to merge engagement of Operators rather than working with them individually. Operators acknowledged that they have very often faced the conflict of incompatibility in standards and regulations. They therefore support the cooperation and are ready to engage actively.
The Committee has established close cooperation with Kazenergy Association and a relevant Memorandum has been signed. Aktau Declaration can assist the process to bring Operators and stakeholders together to facilitate the activities.
1. Kazenergy to provide information and Action plan on re-establishment of the technical commitees and cooperation with MINT.
2. Aktau Declraration as the facilitator of the process to provide the representatives from Operators.
NADLoC: call for dialogue
Aktau Declaration was requested to arrange meetingbetween NADLoC and Operators to assist and advise on the upgrading of the local companies register. This was supported by TCO, KPO, NCOC.
- Secretariat to arrange meeting of NADLoC and Contracts&Procurement and IT Departments of Operating companies
- NADLoC to provide detail as to what they wish to adress and outcome of the meetings
Engineering and Construction Licensing
Aktau Declaration Secretariat was sent a concern expressed by an EPC Contractor relating to Engineering and Construction Licensing. It was suggested that current laws covering the Lisencing of Engineering and Construction contractors do not encourage foreign companies to form joint ventures with Kazakhs companies, and that the sustainable development of local content and technology transfer will not be achieved without joint ventures not being formed.
Operators, who are being actively encouraged to form JVs, acknowledged that current legislation can make this difficult to achieve and that are often differences of approach at decision making levels. Competing differences and conflict in legislation can have material effect on future growth programmes.Operators agreed that this is a situation that should be resolved and support initiatives that can help to bring clarification through dialogue.
- Operators supported common position that clear message needs to be articulated and presented for clarification and agreement at the highest level.
Code of Practice
KPO forwarded to Secretariat a suggested draft of Supply Chain Code of Practice to be considered by Aktau Declaration stakeholders. A similar succesful model had been adopted by the North Sea UK Oil and Gas sector. The Code of Practice gives the opportunity for Operators to declare openess, transparency and to express a message that would be supporting Kazakhstan's and their endevours. The Code could assist pulling together positive initiatives already in practice, highlighting that Operators 'have nothing to hide'. Operators supported hte principle of such a document. KMG raised the point about the transparency in scoring system of tender procedures; TCO regarding advance payments.
The contents of Kazenergy’sproposed draft of Code of Practice of last year be considered for issues that might be drawn upon
1. Secretariat to collect proposals and comments to the KPO draft of Code of Practice and forward for alterations
2. KPO to present the updated version of Code of Practice for next AD meeting.
Aktau Declaration suggested for consideration the idea of establishing a JV Register, possibly within the AD website, where existing JVs could be registered on a voluntary basis. Benefits of such a register would help to bring transparency as to who do and do not have JV partners and might generally assist in bringing more transparency to the importance of JV creation.
Operators supported the idea. The JV register can be a good mechanism of propogating proper JV creation and be examples for others.
1. Secretariat to prepare in details how it can work in practice.
Secretariat submitted template version of gathering information on procurements of goods and separately services for consideration.
- Taking into account the amount of information that has been sent to KMG by Operators, it was agreed that there be an analysis of data provided.
- To re-establish technical meetings on Specifications and Standards
- That Top10 opportunities on services be continued
It is requested to place considerable future endeavours on establishing JV activity. One of the effective ways to achieve results would by matchmaking of international and national companies, particularly with those who currently win orders either from the three international operators or suppliers to KMG.
A list has been prepared by the Secretariat of existing international suppliers by categories of goods. Contact will be made with each to encourage Out of that list, it is considered to be most helpful, to identify specifically companies that can be helpful to Kazakhstan and encourage them to establish production here in partnership with locals. Having the right companies locally can help to maximize local content and localization for Operators.
- Operators to suggest target companies helpful to Kazakh arena
- Secretariat to make the list of matching local companies according to the list of international.
- To assess merits of a major oil and gas exhibition/conference Spring 2015 in order to showcase Kazakhstan with focus on matchmaking achievement
Next Aktau Declaration meeting at the beginning of February, 2014. Venue TBD. Duration to be over a three day period to allow maximum consideration on each subject needing to be advanced.