Sustainability Report - Pluspetrol

SustainabilityReport

2014

SINCE 2008 WE HAVE PUBLISHED OUR ANNUAL SUSTAINABILITY

REPORT (SR) WHERE WE SUMMARIZE THE MAIN RESULTS AND

ACTIVITIES CONCERNING OUR ECONOMIC, ENVIRONMENTAL

AND SOCIAL PERFORMANCE. THIS REPORT IS BASED ON THE

GRI GUIDE 3.1 GUIDELINES, WITH ITS OIL AND GAS SECTOR

SUPPLEMENT, AND ON THE REPORT GUIDE “OIL AND GAS

INDUSTRY GUIDANCE ON VOLUNTARY REPORTING”, JOINTLY

DRAWN UP BY IPIECA, API AND IOGP IN ITS SECOND VERSION.

THE SR 2014 SCOPE COMPRISES THE AREAS OPERATED BY

PLUSPETROL, WITH A DESCRIPTION OF THE ACTIVITIES

CONDUCTED IN ANGOLA, ARGENTINA, BOLIVIA, COLOMBIA,

PERU AND VENEZUELA. IT SHOULD BE NOTED THAT THE

REPORTED QUANTITATIVE PERFORMANCE INDICATORS INCLUDE

INFORMATION FROM AREAS CURRENTLY IN THE PRODUCTION

PHASE, MAINLY OPERATIONS IN ARGENTINA, BOLIVIA AND PERU.

AS FROM THIS YEAR, ALSO THE RESULTS FOR ANGOLA HAVE

BEEN INCORPORATED FOR SOME INDICATORS.

IN ADDITION TO THE ABOVE, THIS YEAR WE MADE PROGRESS

IN THE DEVELOPMENT OF AN INTEGRAL PROCESS OF ANALYSIS

FOR THE IDENTIFICATION AND PRIORITIZATION OF OUR

STAKEHOLDERS, AS WELL AS IN THE MATERIALITY ANALYSIS.

LIKEWISE, WE MANAGED TO IMPROVE OUR PERFORMANCE

INDICATORS BOTH IN QUANTITY AND QUALITY, REACHING 49

INDICATORS IN THE GRI GUIDE 3.1. THE PROGRESS RELATED TO

THE MATERIALITY ANALYSIS AND THE NUMBER OF INDICATORS

REPORTED ARE EVIDENCE OF OUR COMMITMENT WITH

SUSTAINABLE MANAGEMENT AND ITS COMMUNICATION TO OUR

STAKEHOLDERS.

DURING THE PREPARATION OF THIS REPORT SEVERAL AREAS

AND COLLABORATORS PARTICIPATED WITHOUT WHICH ITS

PUBLICATION WOULD NOT HAVE BEEN POSSIBLE. WE ARE

ESPECIALLY GRATEFUL TO EVERYONE FOR THEIR EFFORT AND

COMMITMENT.

About theSustainability Report 2014

Through this report, we account

for the way the Company manages its

activities, offering transparency and

compliance with best practices and

operational excellence, which nowadays

are critical to share with and communicate

to all our stakeholders.

The Sustainability Report

contributes with knowledge and statistic,

which are very useful for day-to-day

business. For the company’s employees, it

is a permanent consultation document, an

accurate source of data.

The chapters I’m more interested

in are those related to the Environment and

Community, which show how we can work

in a responsible way, protecting the

environment and people.

Our people’s opinion in the disclosure process of the 2013 Sustainability Report

1. Global Reporting Initiative. https://www.globalreporting.org/2. International Petroleum Industry Environmental Conservation Association. http://www.ipieca.org/3. American Petroleum Institute. http://www.api.org/4. International Association Oil & Gas Producers. http://www.ogp.org.uk/

THE INCREASING ENERGY DEMAND ADDED TO THE COMPLEX SOCIAL, POLITICAL AND

ENVIRONMENTAL SETTINGS IN WHICH THE OIL AND GAS BUSINESS ARE DEVELOPED AND THE

GROWING INTEREST OF STAKEHOLDERS REQUIRE AN IMPORTANT COMMITMENT WITH THE

RESPONSIBLE DEVELOPMENT OF THE ACTIVITIES FROM OUR INDUSTRY.

AND IT IS NOT AN EASY COMMITMENT. WE WORK IN AN INDUSTRY AT THE CENTER OF SOCIAL

ATTENTION, WHICH REQUIRES THAT WE IMPLEMENT BETTER PRACTICES EVERY DAY, WHILE

OBSERVING RULES THAT HAVE BECOME MORE RESTRICTIVE, WHICH HAS CIVIL SOCIAL

ORGANIZATIONS MONITORING OUR PERFORMANCE, AND WHICH IS HIGHLY COMPETITIVE DUE TO

THE ACCESS TO RESERVES.

NOTWITHSTANDING, FOR MORE THAN 35 YEARS, PLUSPETROL HAS BEEN ABLE TO ADDRESS

THOSE CHALLENGES WHILE CONTINUING TO GROW. AND WE ARE CONVINCED THAT WE WILL

CONTINUE ON THIS TRACK, HELPING COVER THE INCREASING ENERGY NEEDS, AND ACTING IN

AN ECONOMIC, SOCIAL AND ENVIRONMENTALLY RESPONSIBLE WAY, INTEGRATING ALL THESE

ASPECTS IN THE BUSINESS DECISION-MAKING.

WITH THIS SPIRIT, PLUSPETROL PRESENTS ITS SEVENTH SUSTAINABILITY REPORT, IN WHICH WE

DESCRIBE OUR PERFORMANCE DURING 2014 IN DETAIL. IN THIS PERIOD, WE HAVE DECIDED TO

CONSOLIDATE AND BOOST OUR SUSTAINABILITY AND OPERATIONAL EXCELLENCE CORPORATE

LETTER FROM THE CEO

LETTER FROM THE CEO

STRATEGIES, WITH THE HOPE OF BEING ACKNOWLEDGED REGION-WIDE FOR OUR HIGH

OPERATING STANDARDS AND A STRONG COMMITMENT TO RESPONSIBLE DEVELOPMENT.

A HIGHLIGHT DURING THIS YEAR HAS BEEN THE 10-YEAR CELEBRATION FOR OUR ACTIVITIES IN

CAMISEA, THE PERU’S MOST IMPORTANT ENERGY PROJECT, WHICH HAS DRIVEN THE COUNTRY´S

GROWTH THROUGH THE INCORPORATION OF NATURAL GAS AS ALTERNATIVE CLEANER FUEL IN

THE DOMESTIC MARKET. ALL THIS LED TO CHANGES IN THE COUNTRY´S ENERGY MATRIX, THUS

REDUCING EMISSIONS AS A CONSEQUENCE OF ITS USE.

FINALLY, I’D LIKE TO UNDERLINE THAT IN THIS NEW EDITION OF THE SUSTAINABILITY REPORT,

WE HAVE IMPROVED THE DATA RECORD SYSTEM FOR THE PRESENTED INDICATORS, THUS

OPTIMIZING THE DATA COLLECTION FILES AND TRAINING THE STAFF RESPONSIBLE FOR THE

INFORMATION IN THE DIFFERENT OPERATION UNITS.

WE INVITE YOU TO LOOK OVER THE PAGES OF THIS SEVENTH SUSTAINABILITY REPORT,

WHICH DESCRIBES THE 2014´S MOST OUTSTANDING MILESTONES OF 2014 REGARDING SOCIAL,

ENVIRONMENT AND ECONOMIC MATTERS WHICH HAVE AN IMPACT ON OUR OPERATIONS AND

OUR MAIN STAKEHOLDERS.

Steven G. CrowellPresident and CEO

26060201

ABOUT THE SUSTAINABILITY REPORT 2014

LETTER FROM THE CEO

ABOUTPLUSPETROL

Company Profile

Governance

Our Corporate Strategy

Stakeholders

Supply Chain

Activities

Highligths

OUR PEOPLE

Human Capital

Management

Training and

Development

Benefits

Health

Communication

34

ENVIRONMENT

Environmental

Management

Environmental

Performance in

Numbers

Energy Efficiency &

Climate Change

Environmental

Impact Management

Natural Resources

Management

64

COMMUNITY

Management with

the Communities

Social Investment

Participatory

Processes

Indigenous

Communities

Community and

Value Chain

88

SAFETY

Safety and Operations

Integrity Management

Safety

Other Actions Performed

98

GRI INDEX

Opinion Poll

ABOUT PLUSPETROL

PLUSPETROL IS COMMITTED TO DEVELOPING ITS ACTIVITIES

PERMANENTLY IMPROVING ITS PRACTICES, PURSUING EXCELLENCE

IN EACH OF ITS PROCESSES TO MEET ITS LONG-TERM GROWTH

AND SUSTAINABILITY GOALS. TO THIS END, IT INTEGRATES ECONOMIC,

SOCIAL AND ENVIRONMENTAL ASPECTS FOR DECISION MAKING,

TOGETHER WITH ETHICAL MANAGEMENT, SEARCHING TO BALANCE

SHORT- AND LONG-TERM INTERESTS IN ORDER TO GENERATE SHARED

VALUE FOR THE COMPANY AND ITS STAKEHOLDERS.

06 • Pluspetrol

COMPANY PROFILE

GOVERNANCE

CORPORATE STRATEGY

STAKEHOLDERS

SUPPLYCHAIN

ACTIVITIES

HIGHLIGHTS

ABOUTPLUSPETROL

Sustainability Report 2014 • 07

Malvinas Gas PlantCamisea, Peru.

COMPANY PROFILE5

PLUSPETROL IS A PRIVATE ENERGY COMPANY WITH OVER35 YEARS OF EXPERIENCE IN HYDROCARBON EXPLORATION AND PRODUCTION.

URUGUAYMONTEVIDEOCORPORATE OFFICES AND ASSISTANCE IN COMMERCIAL OVERSIGHT

YEARS INTHE INDUSTRY

COUNTRIES WHERE PLUSPETROLCARRIES OUT OPERATIONS, IN SOUTH AMERICA AND AFRICA

DIRECTLYHIRED PEOPLE

EXPLORATIONWELLS DRILLED

References6

OfficesExplorationProductionNGLFPSub Andean Bases

6. Points are not geographically referenced.

5. December 2014 data.

08 • Pluspetrol

BBL/D OF LIQUIDSPRODUCTION

MMSCF/D OF GASPRODUCTION

PRODUCTIONWELLS DRILLED

USAHOUSTONBUSINESS OFFICE

VENEZUELA

COLOMBIA

PERU

BOLIVIA

ARGENTINAMMBOE OF TOTAL OPERATED PRODUCTION

+35 6

+2,200

13

163,903 1,921

73

190.8

Department of GuaviareDepartment of MetaDepartment of Vichada

CPE-7 BlockCPO-3 BlockCPO-2 Block

---

Name Location

Name Location

COLOMBIA

AREAS OF OPERATION (DETAILS)

NON-OPERATED AREAS

Department of LoretoDepartment of Loreto

Block 8Block 1AB

--

PPN, PERU

Basin of rivers Ene and ApurimacDepartment of LoretoDepartment of Loreto

Block 108Block 115Block 102

---

PLUSPETROL E&P, PERU

Department of Santa CruzDepartment of Santa CruzDepartment of Santa CruzDepartment of Santa CruzDepartment of TarijaDepartment of Tarija

Tacobo FieldCuriche FieldTajibo FieldRío Seco FieldBermejo-Toro FieldHuaico Field

------

BOLIVIA

Lower Urubamba region, Department of CuscoLower Urubamba region, Department of CuscoProvince of Pisco, Department of Ica

---

Block56Block 88Natural Gas Liquids Fractionation Plant and Marine Terminal

CAMISEA, PERU

Guárico StateGuárico State

TiznadoBarbacoas

--

VENEZUELA

Magallanes XII RegionEl Tranquilo

CHILE

-

Urabá AntioqueñoPutumayo

Putumayo 12 BlockSN 1 Block

COLOMBIA

--

NETHERLANDSAMSTERDAMHEADQUARTERS

OPERATINGAREAS

PLUSPETROL DEVELOPS EXPLORATION AND PRODUCTION ACTIVITIES OF OIL AND GAS RESERVES IN VERY COMPLEX ENVIRONMENTS.

IN ITS OPERATIONS IT EMPLOYS THE HIGHEST OPERATIONAL STANDARDS AND MAKES USE OF THE BEST TECHNOLOGIES, PRIORITIZING RESPECT FOR THE ENVIRONMENT, LOCALCULTURE AND ARCHEOLOGICAL HERITAGE, IN A SAFE AND RESPONSIBLE WAY.

Production

Oil and gas production is conducted in diverse geographical environments, which range from the Patagonia region in Argentina to the Peruvian Amazon rainforest, including urban areas as well as territories inhabited by indigenous communities. The quantitative performance indicators presented in this Report only include results from the production areas.

Operated Areas

It refers to the geographical areas where Pluspetrol holds a controlling interest over its operations. The scope of this Report includes all the areas operated by the Company in Angola, Argentina, Bolivia and Peru.

Exploration

Oil and gas reserve exploration is one of the company’s strategic activities, as it determines its projection into the future. The permanent search for new opportunities runs from current areas in operation to new regions in countries where the company has not yet developed any activities. This Report provides detail on the qualitative aspects related to the activities performed in exploration areas.

Non-Operated Areas

Non-operated areas include zones where Pluspetrol does not hold controlling interest to date: Chile, Argentina, Peru and Colombia. Also included here are those areas operated by Pluspetrol but which are in an exploration phase: Colombia and Venezuela. This Report does not include data on non-operated areas without a controlling interest.

Provinces of Neuquén and Río NegroProvince of La Pampa, Neuquén and MendozaProvince of Salta and Formosa

Neuquén AreaRío Colorado AreaNorthern Area

ARGENTINA

---

Province of CabindaSouth Cabinda Block

ANGOLA

-

Province of SaltaRío Colorado

ARGENTINA

-


Department of Madre de DiosBlock 76

PERU

-

ANGOLA

Comité Ejecutivo

Led by Pluspetrol’s CEO, it consists of four members. Its creation

favored a better project coordination and a greater focus on the

Company’s growth strategy and communication between the

different sectors, and with collaborators.

Crisis Committee

Pluspetrol has an internal crisis management procedure, under

which the formation of a committee to face any crisis is

considered, in order to respond in a coordinated way among the

different sectors of the Organization; providing strategy

management, support, resources and the appropriate attention

to the stakeholders’ concerns both inside and outside of the

Company, related to the event.

CORPORATE GOVERNANCE PROVIDES THE INCENTIVES

TO PROTECT THE COMPANY’S INTERESTS, PROMOTE

VALUE CREATION AND THE EFFICIENT USE OF RESOURCES,

WHILE PROVIDING TRANSPARENCY IN INFORMATION

MANAGEMENT. IN THIS WAY, THE TRANSPARENCY IN

THE GOVERNANCE STRUCTURE AND THE COMPOSITION

OF THE ORGANIZATION ARE VITAL TO ENSURE

ACCOUNTABILITY TO OUR STAKEHOLDERS. BELOW WE

DESCRIBE OUR COMPANY’S GOVERNANCE AND ETHICS

REGULATION CODES AND POLICIES.

THE COMPANY’S GOVERNANCE

The organization for decision-making, the policies that regulate

our management and the transparency in our relations with

stakeholders are key dimensions that feed and strengthen our

governance.

Additionally, there are different executive bodies within the

company which are assigned specific roles and responsibilities

for their performance.

Board of Directors

Pluspetrol’s Board of Directors represents the company’s top

managing organ and is comprised of three independent

members appointed by the Shareholders’ Meeting. It is in charge

of defining the Company’s objectives and strategic pillars,

supervising and controlling internal management, and assessing

organizational performance.

GOVERNANCE

COMITÉ EJECUTIVO

CEO y Presidente

Senior VP Producción Global de Activos

Senior VP Servicios Corporativos y CFO

Senior VP Desarrollo Corporativo

CorporateServices

Responsible for providing the best cost-effective balance support for the whole company.

Corporate Development

Responsible for projecting the Company’s future development.

Global Assets Production

Responsible for optimizing the Company’s assets production.

10 • Pluspetrol


ETHICAL BEHAVIOR

The set of policies and codes that today rule our operations

constitute a common framework for all the Business Units, as

they set general corporate guidelines based on which each of

them draws specific action plans and programs, appropriate to

their local context. During 2014, two valuable ethical behavior

initiatives materialized: the creation of an Ethics Committee

and the implementation of a new whistleblower channel called

“Ethics Line”.

Code of Ethics

Since 2008, Pluspetrol has had a Code of Ethics in force that

establishes the attitude of integrity, criterion and moderation

that all personnel must assume in front of our clients, suppliers

and other persons who may or not be part of the Company, in

order to prevent situations that may compromise the Company

or its employees with respect to their subjectivity and freedom

to decide.

All Pluspetrol collaborators subscribe to this code through its

signature upon joining the company.

Ethics Committee

Excellence and sustainability are achieved by means of honest

and transparent behaviors. With this vision, the Company’s

Management created the Ethics Committee made up by the

Directors of the Legal Affairs, Human Resources and Internal

Audit areas, whose responsibility is to analyze the complaints

submitted concerning ethics or law violations through any

of the channels available.

Ethics Line

In 2014, a new contact channel was added to report unethical

behaviors. Besides the usual communication with their

immediate superior or the Human Resources department, now

employees can make use of the Pluspetrol Ethics Line, a tool

designed to facilitate reporting behaviors that may be contrary

to the Company’s Best Business Practices.

This new tool is available 24/7, through intranet and internet.

Notifications may be sent by email ([email protected]),

or filling in the form on the web www.ethicsline.pluspetrol.net.

Also, in some countries, contact telephone lines have been set

up, too.

Pluspetrol Ethics Line is managed by the KPMG company, so as

to ensure confidentiality throughout the process. This company

receives the different cases and channels them to Pluspetrol’s

Ethics Committee for their analysis.

7. Pluspetrol’s contributions to the Peruvian Government in termsof oil and gas Royalties and Revenue; information submitted to EITI. In Peruvian nuevos soles (S /.)

PERU

TRANSPARENCY IN THE RELATIONSHIP WITH THE GOVERNMENT

Regarding our operations in Peru, we

continue participating in the Extractive

Industries Transparency Initiative (EITI)

as a mechanism that favors transparency

and strengthens our stakeholders’

trust. Pluspetrol voluntarily participated,

together with other 58 extractive

companies, in the Third National

Conciliation Study, corresponding to 2011

and 2012. Through this study, data was

made available on the revenue of the

Peruvian State and the payments made

by the 59 voluntary member companies,

on income tax; mining, gas and oil

royalties; special mining tax; special mining

obligations and validity rights.

ABOUT PLUSPETROL

2013

2012

2011

2,084.67 MILLIONS OF S/.



12 • Pluspetrol

PURPOSE, VISION AND VALUES CORPORATE STRATEGY

THE DEVELOPMENT OF OUR

OPERATIONS POSES THE CONSTANT

CHALLENGE OF RECONCILING

TECHNICAL, SOCIAL, ENVIRONMENTAL

AND SAFETY ASPECTS. TO FACE

IT IN A SUCCESSFUL WAY, WE HAVE

DESIGNED A STRATEGY THAT

ENABLES US TO MAINTAIN THE

EXCELLENCE OF OUR OPERATIONS

AND BE CREATIVE REGARDING THE

EXPLORATION OF DIVERSE AS WELL

AS COMPLEX REGIONS, WHILE

WORKING ON REDUCING IMPACTS ON

THE ENVIRONMENT AND NEIGHBORING

COMMUNITIES. PLUSPETROL’S

CORPORATE STRATEGY CONSIDERS

THREE MAIN AXES: SUSTAINABILITY

MANAGEMENT, SUSTAINABLE

GROWTH AND OPERATIONAL

EXCELLENCE.

Think beyond possibilities; act

despite uncertainty

Be persistent

Team work as a way of setting free

our imagination and creativity

Develop our human resources’

talents

Use resources efficiently,

bearing in mind the low cost

concept

Capitalize on opportunities

Preserve the environment

VISIONStand out as a benchmark

company among international energy

companies.

PURPOSESatisfy all of our

stakeholders’ (shareholders, employees, their families,

partners, suppliers, clients, governments, and the

communities in the countries where we operate) needs

and expectations maintaining our own identity.


ABOUT PLUSPETROL

OUR SUSTAINABILITY MANAGEMENT

We understand Sustainability as the path to achieve our vision

of becoming an international benchmark company in

hydrocarbons exploration and production. Along this path, in

order to create shared value, we search to integrate and balance

the short and long-term interests of our stakeholders, including

employees, shareholders, suppliers, clients, governments

and communities from the countries where we operate. We are

aware that our activities are a source for employment and

income generation for governments and local communities,

a local economic growth and investment driver. This is why we

are responsible for ensuring the business’s continuity, and

sustainability is the strategy to achieve it.

The sustainability framework that we have defined directs us

to conduct our activities in pursuit of excellence in the

management of each of the processes, focused on a rational,

efficient use of resources, preserving the environment and

operating safely and responsibly, while we capitalize

opportunities in a permanent cycle of continuous improvement.

Our approach maintains environmental, social and safety

aspects as a priority. An important tool to meet company

sustainability objectives, and which allow us to address the

abovementioned aspects, is risk management. All our operations

are developed in complex regions and environmentally and

socially sensitive environments, such as the Amazon rainforest in

Peru, or the Bolivian blocks located in native community areas.

In order to respond to these situations properly, we continue

improving our management systems, including the way we

identify, assess and manage risks associated with our activities

and projects. In this sense, during 2014, the Environment and

Community Affairs Directorate has started the process of

design and implementation of a Corporate Environmental and

Social Management System (SGASC, for its Spanish acronym),

establishing environmental and social criteria and guidelines as

minimum baseline requirements for all our operations.

Although Sustainability crosses the whole Company, its

management is carried out by the Environment and Community

Affairs Directorate which, in turn, reports directly to the

Corporate Development Vice-Presidency.

INTERVIEW WITH ENVIRONMENT AND COMMUNITY AFFAIRS DIRECTOR, CHRISTIAN DÖBEREINER

What challenges as the new leader of environmental and community affairs of Pluspetrol did you pose yourself?

My first action was to listen, listen, listen…and try to understand the Company’s Culture and our main challenges. I soon realized we had a great team with highly qualified and experienced social and environmental personnel, which needed only to prioritize and focus a bit more on building the corporate systems and processes, while aligning to standards and preparing the company for growth.

What company achievements would you highlight?

A very good example of the Company competence and achievement is the Camisea Gas Project in the Peruvian Amazon, where the social and environmental aspects are an example of a world class operation, showing us that we can do it. We need only to capture these leanings and apply them in the rest of our operations.

What are Pluspetrol’s challenges and opportunities in sustainability for the coming years?

Our short term challenge is to finalize and implement our Social & Environmental Management System aligned with Operational Excellence. The Management system will enable us to better manage our social and environmental risks that will be reflected in our continuously improving performance.

New Sustainability Policy

During 2014, our sustainability policy was drawn up. Pluspetrol

understands it as a commitment to the continuous improvement

of its processes to meet its long-term growth and sustainability

goals.

THREE KEYS TO SUSTAINED GROWTH

Our Exploration Department has designed a five-year

growth strategy. For its progress to be efficient, it

has considered the operations that the company

currently develops in different operational areas, its

operational capacity and the expertise of the

corporation’s technical and geoscientists team and

the various business units.

Diversify. The current production pace forces us to

have a reasonable reserve replacement enabling

long-term economic support. For this reason, we

are working on building an opportunity portfolio

that includes different alternatives in terms of value

and risk.

Explore. The easy oil era is over. For the future,

we are directing a search towards more complex

geographies, which we carry out successfully thanks

to the deployment of advanced technologies.

Adapt. We must be prepared to adapt our business

to the evolution of an uncertain market, and be

capable of offering fast and efficient answers.

Geographical Expansion

Our strategy is based on maintaining two focus

regions: Latin America and Western Africa. Through

geological studies, we have defined the areas of

more prospective interest.

High priority. Areas where we will concentrate our

resources and the necessary funds to carry out the

works. Here is where we could obtain E&P areas,

outline prospects, start farm-in processes (with

limited exploratory cycles), discover and produce

hydrocarbons, activate the search for opportunities

through engagement in biddings or strategic

associations.

Watching basins. Basins that require more complex

regional geological analysis to complement the

information that Pluspetrol already has in its records.

These basins do not have the appropriate conditions

to access the markets in the short term, and they do

not have available areas.

14 • Pluspetrol

WHY A A SUSTAINABILITY POLICY IN PLUSPETROL?

BECAUSE GUIDELINES ARE NEEDED TO ENABLE THE

COMPANY TO THINK IN THE LONG TERM, CONSIDERING

ALL ITS STAKEHOLDERS AND CREATING SHARED VALUE

WITH THEM.

BECAUSE BECOMING A GLOBAL COMPANY EXPOSES US

TO GREATER RISKS AND FACING THEM INVOLVES HAVING

NEW SYSTEMS AND PROCESSES THAT WILL LEAD US TO

BE A WORLD- CLASS COMPANY IN THE INDUSTRY.

THE SUCCESS OF THE INTERNATIONAL

EXPLORATORY PROGRAM MAINLY LIES IN

REMAINING FOCUSED, WELL PREPARED AND

ATTENTIVE TO MAKE A GOOD SELECTION OF

THE AREAS. MAINTAINING THE FOCUS AND

PERSEVERANCE IS CRUCIAL, PARTICULARLY

DURING HIGHLY UNCERTAIN PERIODS, WHEN

MANY TIMES CRISES TURN INTO EXCELLENT

OPPORTUNITIES.

APPROVALManagement confirms its enactment

SOCIALIZATIONAnalysis with Country Managers

VALIDATIONDiscussion with different corporate areas

PILLARSPluspetrol’s values as policy foundations

BENCHMARKINGAnalysis of other companies’ best practices and background

STARTManagement Decision

PLUSPETROLSUSTAINABILITYPOLICY

It is organized around nine principles that seek excellence in each of the Company’s processes; it proposes business ethical management, integrating economic, social and environmental aspects balanced with short and long-term interests, in order to create shared value for the Company and its stakeholders.

•

•

ALIGNED WITH THE BEST INTERNATIONAL PRACTICES

During 2014, Pluspetrol joined the International Oil

and Gas Producers Association (IOGP), a prestigious

global forum whose members relate and share the

best practices associated to Health, Safety, the

Environment, Social Responsibility, Engineering and

Operations. Formed in 1974 to develop efficient

communications among industry members in a

complex context with growing international

regulations, the IOGP stands out for the publication

of standards, guidelines, indicators reports and useful

information for the industry.

Since 2006, we have been members of the

Regional Association of Oil, Gas and Biofuels Sector

Companies in Latin America and the Caribbean

(ARPEL). This association brings together public

and private companies, and oil and gas sector

institutions. Its main goal is to promote the industry

integration and growth, and maximize its

contribution to sustainable energy development in

the region. Pluspetrol is a member of ARPEL’s

Board of Directors, and is also actively engaged in

six technical committees that support the

association’s activities.

In 2014, it should be noted that Pluspetrol was

re-elected as President of the Social Responsibility

Committee. In addition, and like every year, we

participated in the Environmental Benchmarking

project, through which member companies report a

series of key environmental performance indicators.

This allows, among other things, to identify the

trends of specific environmental aspects like the use

of resources, and to foster environmental

management enhancement.


ABOUT PLUSPETROL

work mode is much better than the sum of individual

efforts. Following this work line, focus was placed

on two main processes: Capital Excellence Process

(CEP) and Contractors Performance Management

(CPM). In the first case, we have extended

and deepened the CEP implementation in Peru and

Argentina. Opportunities and projects channeled

under CEP nowadays reach around 30% of the

investment amount planned for the next three years

in GPA. On the other hand, with the implementation

of the Contractors Performance Management

Process (CPM) we achieved another step towards

excellence. Management of our contractors

and the contracts that connect us with them are key

elements to ensure more efficient and safer

operations.

WE MUST POINT OUT THAT ON SEPTEMBER 4,

THE COMPANY HELD THE “FIRST CONTRACTORS

FORUM, TOWARDS OPERATIONAL EXCELLENCE”

IN MONTEVIDEO, URUGUAY, WHERE IT GLOBALLY

SHARED ITS GROWTH AND EXCELLENCE VISION

WITH OVER 50 CONTRACTORS.

Operational Excellence is the strategy to ensure,

from the Operations VP, the growth, value creation

and long-term sustainability objectives. With

this strategy, we seek to impact on different areas

connected with the management of our business,

such as safety and integrity, production efficiency,

reserve replacement, operational costs optimization,

capital productivity enhancement and ensuring our

license to operate.

Operational Excellence is a concept and work mode

that allows us to capture a vision of how we want to

perform in all our operations. This vision is supported

on the following value drivers: standards and

processes, technology, organizational capacity, and

performance & learning.

Operational Excellence – 2014 Highlights:

During 2014 we worked on the implementation of

this strategy in each of the value drivers. Managing

through defined processes helps us consolidate

collaborative team work, aligned with one of

Pluspetrol’s core values. We are certain that this

OPERATIONAL EXCELLENCE

Safety and IntegrityProduction efficiencyReserves replacementCost optimizationCapital productivityLicense to operate

●

●

●

●

●

●

SUSTAINABLE GROWTH

EFFICIENCY

CONFIDENTIALITY

SAFETY

Standards and Processes

Technology

Organizational Capacity

Performance & Learning

Operational Excellence

16 • Pluspetrol

From a technological point of view, each of the

Operations VP management areas has put in place

a plan to assess and incorporate the appropriate

technology to meet the challenges our business

needs to face. Such plan involves, among others, the

development and exploration of non-conventional

resources, heavy oils and assisted recovery,

digitalization of our fields’ operation, and the

application of Process Safety Management (PSM)

concepts, in order to ensure the appropriate

management of operational risk.

Organizational capacity is another essential pillar

for our growth and sustainability. In this regard,

we have worked on the definition of technical

competences of diverse operational disciplines, as

well as geology and geophysics, which will let us

improve our competence and training management

in the future. In search for assurance of the technical

competencies required for our collaborators, during

November and December, Pluspetrol invited its staff

from the operational areas to participate in the

“Foundations of Process Safety” course, in order to

strengthen their knowledge in this subject. Likewise,

in December, a training session on Well Integrity

was held in Peru, attended by members from

different business units responsible for ensuring

wells’ integrity.

Lastly, Performance & learning is a crucial driver to

understand the roles we must perform and what is

expected from us. To this end, we have worked

hard on devising the tools that will help us measure

our performance, such as the GPA Operations

Dashboard, the Well Construction Dashboard and

other boards to follow-up projects, as well as on

the practices or processes for goal planning, results

review and actions definition to support ongoing

improvements.

During 2015, we will continue with the

implementation of our Operational Excellence

strategy, strengthening our model with the

incorporation of planning as an axis for integration,

with a permanent focus on improving our operations

performance. The 2015 performance objectives need

to be aligned with our excellence and continuous

improvement vision to achieve safe, reliable and

efficient operations.

OUR PATH TO EXCELLENCE IS A COLLECTIVE

CONSTRUCTION THAT DEMANDS COMMITMENT,

PERSEVERANCE, TENACITY AND THE ABILITY TO

LEARN FROM OUR OWN MISTAKES AS WELL AS

OUR ACCOMPLISHMENTS.

ABOUT PLUSPETROL


••••••••

••

•

••

•

EACH YEAR WE WORK TO IDENTIFY

THOSE STAKEHOLDERS MORE LINKED

TO OUR BUSINESS, INCORPORATING

THOSE WHO EMERGE DUE TO THE

DYNAMICS OF THE ENVIRONMENTS

WHERE WE OPERATE, AS WELL AS

THE DEVELOPMENT OF NEW AREAS

OF OPERATION. WE SEEK MAINLY TO

ENGAGE WITH OUR STAKEHOLDERS

SO AS TO CREATE SHARED VALUE FOR

THE COMPANY AND FOR THESE

GROUPS; BESIDES, OUR OBJECTIVE IS

TO IMPROVE THE MATERIALITY IN

OUR REPORT, ACCOUNTING FOR THE

TOPICS THAT STAKEHOLDERS ARE

INTERESTED IN, OURSELVES BEING

THE SOURCE OF TRANSPARENT AND

DIRECT INFORMATION ABOUT

“WHAT DO WE DO?” AND “HOW DO

WE DO IT?”.

IDENTIFYING STAKEHOLDERS

During the reported period, an

identification and prioritization of

stakeholders work was carried out, to

later establish outreach strategies.

Further, it is a relevant precedent that is

providing us with tools to design a

process which will regularly identify

stakeholders and contribute to the

report’s materiality analysis.

MATERIALITY ANALYSIS

Together with our dialogue channels and

communication tools, we have initiated

a systematic materiality analysis process

to strengthen the relevance and

transparency of the topics described in

our reports. Topics are relevant (or

“material”) when they may be reasonably

important, as they manifest economic,

environmental and social impacts of the

organization, or else, because they

substantially influence stakeholders.

STAKEHOLDERSTogether with our collaborators we seek to preserve occupational health and safety, respect for human rights, and to maintain assets and process safety We work with

governmental organizations, bearing in mind transparency of payments made, and contributing to the countries’ economic and social development

We encourage local communities’ engagement in the different outreach instances and spaces, and we prioritize respect for human rights, the environment -including the use and disposal of water and chemical substances-, and land control, use and management

Procurement of suppliers includes their health and safety, respect for human rights.

We provide our clients with the development of low-carbon energy sources, mitigating climate change and contributing to the energy market transformation

NGOs represent a valuable ally with respect to human rights; the community and stakeholders’ engagement; and the environmental protection and responsible use of natural resources

Our work with the media and opinion leaders is based on honesty and transparency of the messages broadcasted, as well as the consistency and uniformity of the information communicated

18 • Pluspetrol

PLUSPETROL

8. International Petroleum Industry Environmental Conservation Association.9. Global Reporting Initiative.

PRIORITIZATIONOnce the material topics were identified we proceeded to their prioritization in accordance with the following criteria:Degree of importance of the topics in the standards consultedStrategic significance for PluspetrolImportance for our consulted stakeholders (weighting and prioritization exercise)

•

••

IDENTIFICATIONFor the identification of the material matters to be included in our Report, we analyzed:International reporting standards: IPIECA8 and the oil and gas sector supplement of the GRI9 GuideAnalysis of reports of other the sector companiesParticipatory dialogue processesSurveys Meetings

•

•

•••

MATERIALITYThe topics identified as material are:Liaison with local communitiesOccupational health and safetyIndigenous peoples’ rightsRegulatory compliance Asset integrity and process safetyProven Reserves (volume and type)Water ManagementEnergy Emissions, effluents and wastes

Company/employee relationsProducts and services (mitigation of

their environmental impact)Biodiversity

EmploymentCorruption

OIL AND GAS COMPANIES DEVELOP

THEIR BUSINESS IN A DYNAMIC AND

GLOBALIZED ENVIRONMENT, THIS

CREATES A NEED IN COMPANIES TO

REDESIGN THE TRADITIONAL WAY

OF DOING BUSINESS. WITHIN THIS

FRAMEWORK, SUPPLY CHAIN

MANAGEMENT ARISES AS A KEY

SUPPORT TOOL FOR OPERATIONS.

IN PLUSPETROL, THE SUPPLY CHAIN

IS MADE UP OF THREE FUNCTIONAL

SECTORS: PROCUREMENT, LOGISTICS

SUPPLYCHAIN


AND WAREHOUSES; THE FOCUS IS

PUT ON ADDING VALUE BY MEANS OF

PROCURING MATERIALS, EQUIPMENT

AND SERVICES SUPPORTED ON

THE FOLLOWING PILLARS: SAFETY,

PLANNING AND EXECUTION

DEPENDING ON NEEDS; LONG-TERM

VISION AND DECISION-MAKING;

SUPPLIERS DEVELOPMENT; AND

CONTRIBUTION TO THE DEVELOPMENT

OF LOCAL ECONOMIES IN THE PLACES

WHERE WE OPERATE.

ABOUT PLUSPETROL

DEVELOPING LOCAL ECONOMIES

We align our interests with those of local economies

by promoting and hiring local suppliers and

purchases, contributing in the development of new

capacities in the communities who live in the

environments where we operate.

We create shared value with these communities by

accompanying the gradual and organized growth of

local suppliers who provide us with goods and

services, ensuring, at the same time, an efficient use

of local resources.

Perú

In our operations in Peru the relationship with local

suppliers is carried out mainly by contracting

companies created and managed by local people.

These companies offer different services such as

river transport for passengers and smaller loads.

Under this form of communal enterprises we

promote the generation of new employment

opportunities for local people, while the degree of

organization and training they acquire allows them to

access service contracts with Pluspetrol and with

other companies also operating in the area.

20 • Pluspetrol

GLOBAL SUPPLY STRATEGY

Pluspetrol has developed a series of guidelines

within the Strategic Supply conception, whose

general objectives are: to improve expense and

procurement management, and ensure performance

based on best practices. Within this framework,

a series of management programs and approaches

have been designed since 2010, continuing with their

implementation and development to date.

SUPPLIER MANAGEMENT PROGRAM

Its main objective is to develop a planned process

of continuous work with suppliers. Within this

context a key factor is to strengthen relationships

with this stakeholder group related to: supply of

materials, equipment and services, the application

of environmental, safety and sustainability standards,

as well as the efficient management of supply costs,

and the definition of specific conduct conditions with

a regional scope.

CONTRACT MANAGEMENT

Oil and gas companies require “best in class”

solutions to address contract management,

considering that these regulate an essential part in

what refers to the organization of a company’s

operations.

This is why we are taking the first steps towards the

implementation of actions aimed at strengthening

Contract Management. Therefore, we pursue to

actively advance not only in the generation of

standard contracts, but also in relation to their

follow-up during the execution phase and level of

response, completing a better control of potential

risks and maximizing the business operability and

financial performance.

SUPPLIER MANAGEMENT PROGRAM

A process to formalize incorporation of suppliers who comply with minimum predefined standards.

A performance follow-up tool whose objective is to continue, promote or end relationships with suppliers.

A selective program aimed at developing relationships with specific suppliers, based on their strategic level and criticality.

A customized management platform with corporate scope, and internal (governance) and external (suppliers) application scope.

2014UPDATE

The tool to be used was defined, in the Assessment line, whose implementation will be carried out during 2015 and 2016.

TOPICS

SELECTION

ASSESSMENT

OUTREACH

TECHNOLOGY

ABOUT PLUSPETROL


ACTIVITIES

EXPLORATION

During 2014, exploration activities were

performed in Argentina, Bolivia, Peru and

Angola. 11 wells were drilled with a total

25,000 m drilled and seismic activities

were advanced with a total 751 km of 2D

seismic and 715 km2 of 3D seismic.

ArgentinaFive exploratory wells were drilled with

conventional objectives, out of which two

discovered oil from the Mulichinco

Formation (Southeast Barda Cortada x-1

and North La Junta x-1), in Río Colorado

areas. On the other hand, a horizontal well

was installed in the area of Puesto Silva

(Puesto Silva x-1009 h) with an

unconventional objective on Vaca Muerta

Fm, by drilling 750 m inside the

formation.

BoliviaFour exploratory wells were drilled in

the Tacobo area, with shallow (< 2,000

m) and deep (> 5,000 m) objectives.

The deep Tacobo x1003 well, one of the

deepest wells in Bolivia and of Pluspetrol,

with the Santa Rosa Fm exploratory

objective, reached 6308 m depth (200 m

above the objective), and due to strong

gasification and an increase in the

formation pressure, it was temporarily

abandoned until the appropriate

equipment to continue its exploratory

drilling is procured.

AngolaTwo exploratory wells were drilled on

prospects in Cabinda Sur block, with

conventional productive objectives in

Castanha field, both wells resulting

non-productive due to the lack of

appropriate reservoirs. To continue the

exploration, reprocessing of the existing

3D seismic was performed.

PeruExploratory activities in this country

were focused on the acquisition of 2D

seismic data in Block 88, in Camisea, and

in Block 108, of the Ene River basin, both

with exploratory objectives in rainforest

regions and irregular landscapes.

In the case of Block 88, 200 km of 2D

seismic data were gathered to acquire

information on possible prospects

situated in the remaining areas of the

block.

In the case of Block 108, by late 2014, 180

km of 2D seismic were recorded,

distributed in two zones within the area

(north and center).

PLUSPETROL CONDUCTS OIL AND

GAS EXPLORATION AND PRODUCTION

WITH A DUAL CONVICTION: THAT IT

IS POSSIBLE TO OPERATE IN HIGHLY

COMPLEX ENVIRONMENTS BY MAKING

USE OF THE BEST PROVEN

TECHNOLOGIES; AND THAT THIS MAY

BE DONE RESPECTING THE

ENVIRONMENT, THE LOCAL CULTURE

AND ARCHEOLOGICAL HERITAGE IN

EACH OPERATION.

160

140

120

100

80

60

40

20

0

2010

85

113

2011 2012 2013

88

154

75

96

73

110

NUMBER OF WELLS DRILLED

2011/2014 Evolution

PRODUCCIÓN

2011 2012

NUMBER OF WELLS DRILLED

2011/2014 Evolution

EXPLORATION

30

25

20

15

10

5

0

25

13

2011 2012 2013 2014

21

8

2011 2012 2013 2014

••

DRILLINGWORKOVER

2,0

34

1,6

52

1,712

1,9

21

78

1,6

63

1,26

8

1,377

1,723

81

215

OPERATED PRODUCTION

2011/2014 EVOLUTION

2011/2014 EVOLUTION

Gas production (MMscf/d)

Liquids production (Bbl/d)

22 • Pluspetrol

RESULTS

Argentina Bolivia Camisea | Peru PPN | Peru Angola Pluspetrol

59

1932

90

24

2

95

92

08 6

2,500

2,000

1,500

1,000

500

0

180,000

160,000

140,000

120,000

100,000

80,000

60,000

40,000

20,000

0

40

,458

39

,80

2

634

69

5

64

3

79

,524

82,3

69

31,70

4

28

,826

152,3

20

151,6

92

2,4

53


41,570

101,0

14

28

,015

173

,69

5

39

,44

2

62

7

95

,58

4

26

,33

8

1,9

12

163

,90

3

12,2

73

12,7

07 13,8

62

11,5

67

323

69

4

46

58

5

84

PROVEN RESERVES


2011/2014 EVOLUTION

Gas reserves(Bcf)

2011/2014 EVOLUTION

Liquids reserves (MMBbl)

ABOUT PLUSPETROL

1,200

1,000

800

600

400

200

0

1 2 1

77

319

3

86

650

66

0 728

63

54

817

870

8


16,000

14,000

12,000

10,000

8,000

6,000

4,000

2,000

0

Argentina Bolivia Camisea | Peru Pluspetrol

34

4

575

44

6

11,8

66

11,9

90 13

,24

0

0 1

78

7

64

142

176

84

11,1

60

BELOW WE HIGHLIGHT TWO 2014 MILESTONES

THAT WE PARTICULARLY VALUE: THE CAMISEA

PROJECT COMPLETED 10 YEARS OF OPERATION,

AND WITH IT, OUR COMPANY ACHIEVED

THE DEVELOPMENT OF THE MOST IMPORTANT

ENERGY PROJECT IN PERU; FURTHERMORE, THE

COMPANY ENDS THE PERIOD WITH A STRONG

BET ON THE DEVELOPMENT OF

UNCONVENTIONAL HYDROCARBONS IN

ARGENTINA.

10 YEARS OF CAMISEA - PERU

In August 2014, the Camisea Consortium

reached its 10th year of operation in Peru.

Camisea represents the most important energy

project in Peru, driving the country’s growth

through the creation of income, which translates

into sustainable development indexes and

quality of life improvement for society as a whole.

Camisea’s operations develop the national

production of natural gas and derived liquids,

completely changing the energy matrix and

contributing to the country’s industrial development.

The use of Camisea’s natural gas makes it possible

to reduce global emissions of CO2 as it allows

the replacement of more polluting fossil fuels in the

energy matrix of Peru, besides it enables significant

savings year after year, mainly due to energy costs

reductions in households, retail shops, industries,

transport and power generation.

24 • Pluspetrol

HIGHLIGHTS

As part of the celebrations for Camisea’s ten years, a central

ceremony was held on August 4 in the Malvinas Plant. The

President of the Republic, Ollanta Humala Tasso, the Minister

of Energy and Mines, Eleodoro Mayorga, the president of the

Cusco Region, René Concha Lezama, the president of the

Camisea Consortium and Pluspetrol CEO, Steve Crowell,

Pluspetrol Country Manager in Peru, Germán Jiménez Vega,

the presidents of the companies associated in the Camisea

Consortium, national, legislative, regional authorities,

representatives from the native communities in the region

and reporters, among others, attended the celebration.

CAMISEA WELLS

GAS AND CONDENSATES PRODUCTION

MALVINASPLANT

DRY NATURAL GAS AND

DERIVED LIQUIDS SEPARATION

PROCESS

NATURALGAS LIQUIDS

NATURALGAS

LIMA

WHAT DOES CAMISEA

CONSIST OF?

US$ 3,700/4,000 MILLION

WAS THE INVESTMENT FOR THE PROJECT IMPLEMENTATION, EXPLORATION AND EXPLOITATION PHASES, AND THE TWO EXPANSIONS OF THEIR PLANTS SITUATED IN CUSCO AND PISCO.

10 YEARS OF CAMISEA IN FIGURES

US$ 6,300 MILLION

PAID AS ROYALTIES TO THE PERUVIAN STATE, BETWEEN 2004 AND 2013.

1,600 MMSCFD10

IS THE CURRENT PRODUCTION OF NATURAL GAS IN CAMISEA. IT STARTED ITS OPERATIONS WITH A 400 MMSCFD PRODUCTION.

+360,000 VEHICLES

TURNED INTO LPG OR NGV11, THANKS TO THE DEVELOPMENT OF THESE LESS EXPENSIVE AND CONTAMINATING FUELS.

95%

OF SUPPLY OF INTERNAL NATURAL GAS DEMAND IN PERU.

+ US$ 10,000MILLION

SUM OF INVESTMENT DERIVED FROM THE PROJECT (TRANSPORT, DISTRIBUTION AND THERMOELECTRIC INDUSTRY) BETWEEN 2001 AND 2013.

US$ 500 MILLION

CAMISEA PLANS TO INVEST IN THE EXPLORATION AND DEVELOPMENT OF BLOCK 88 IN THE COMING YEARS.

41%

OF THE ELECTRIC GENERATION IN PERU IS PRODUCED BASED ON CAMISEA’S NATURAL GAS.

PISCO

FRACTIONATION PLANT. DIESEL, GASOLINE AND LPG SEPARATION PROCESS.


1TO DEFINE THE CONDITIONS NECESSARY FOR THESE RESOURCES TO BE CONSIDERED AS RESERVES.

TO DETERMINE THE POTENTIAL AMOUNT OF RESOURCES TO BE PRODUCED.

2

The socio-environmental challenges of drilling unconventional wells.

The hydrocarbon industry is continuously

experiencing new developments to increase its

hydrocarbon resources. As of late, the possibility to

develop unconventional resources in Argentina has

arisen. Mostly, the success of such development will

depend on how the social and environmental issues

of said projects are managed. Therefore, Pluspetrol

undertakes a series of actions with the aim of

managing the exploitation of these unconventional

resources in accordance with the Company’s

sustainability guidelines.

We are part of the Argentine Oil and Gas Institute

through our engagement in technical commissions,

working days and meetings aimed at suggesting

and agreeing on the internationally recommended

best practices locally applicable, as well as sharing

experiences among the Companies in this sector for

the development of unconventional resources.

We defined an internal ad hoc inter-disciplinary

group in order to outline action strategies for the

development of these resources. As part of this

group, reference people from the environmental

and social area engage in the search of international

and local experiences in order to generate

recommendations related to best practices, to

manage the potential environmental impacts, and

new technologies applicable to the local conditions

of developing unconventional areas. In this regard,

the work lines being followed are focused on

Preventing impacts on drinking water aquifers’

quality.

Minimizing the use of water resources suitable for

human consumption or irrigation.

Making land use compatible with other economic

activities.

Disclosure processes with the surrounding

population.

Implementing safe treatment alternatives for the

disposal of flowback water.

Safely managing the chemicals used during hydraulic

stimulation.

10. MMSCFD: millons of standard cubic feet daily.11. NGV: Natural Gas Vehicle.

ABOUT PLUSPETROL

•

•

UNCONVENTIONAL HYDROCARBONS

Since early 2011, Pluspetrol started implementing a plan for the

development of unconventional oil and gas resources in the

Neuquén basin. Today Pluspetrol is positioned as one of the

main players in the development of this strategic resource. Vaca

Muerta is the main unconventional gas and oil formation in

Argentina, and one of the most important on the planet.

Betting on this kind of hydrocarbons represents a challenge and

commitment with the future by Pluspetrol. This ambitious

project includes the assessment of resources of both tight gas

and tight oil as well as shale gas and shale oil, and the

implementation of new drilling, completion and production

technologies.

The main objectives of this plan are as follows:

In March, 2014, the acquisition of hydrocarbon assets in the

province of Neuquén was completed, incorporating 1,240 square

kilometers of the Vaca Muerta formation. So far, Pluspetrol has

drilled 13 Liquids/Condensate wells, distributed in Loma

Jarillosa, Puesto Silva Oeste, Cinco Saltos, Centenario, Aguada

Baguales and Apon. Over the next years, we plan to make

several investments focused on the research and development

of the acquired assets’ potential.

OUR PEOPLEWE CREATE AND MAINTAIN RELATIONSHIPS OF TRUST WITH OUR

EMPLOYEES, CONTRACTORS, SUPPLIERS AND OUR STAKEHOLDERS,

CONSIDERING THEIR NEEDS AND EXPECTATIONS WHILE LOOKING

FOR THE GENERATION OF SHARED VALUE.

26 • Pluspetrol

TRAINING AND DEVELOPMENT

HEALTH

COMMUNICATION

BENEFITS

HR IN FIGURES

HUMAN CAPITAL

MANAGEMENT

OURPEOPLE


Malvinas Plant,Camisea, Peru.

In our Company we

believe in an ethical, diverse,

inclusive and collaborative working

environment, with alignment

between the values of the people

and the Company.

Verónica JamesHuman Resources Corporate Director

IN PLUSPETROL, THE GROWTH OBJECTIVE IS GLOBAL: IT IS A

COMPANY WITH AN EXCELLENCE AND LEARNING AGENDA VISION,

WHERE COOPERATION AND CHALLENGE ARE KEY ELEMENTS.

WITHIN THIS FRAMEWORK, WE DEVELOP PROFESSIONALS WITH AN

INTEGRATING MINDSET, BY MEANS OF INTERNATIONAL WORK EXPERIENCES

AND ENGAGEMENT IN INTERDISCIPLINARY AND MULTICULTURAL TEAMS.

IN THIS SENSE, HUMAN CAPITAL MANAGEMENT ALSO AIMS AT PROMOTING

THE BEST WORK PRACTICES IN A SAFE, HEALTHY AND ENVIRONMENTALLY-

FRIENDLY ATMOSPHERE FOR ALL THE COMPANY COLLABORATORS IN THE

DIFFERENT BUSINESS UNITS.

TO THIS END, WE OPERATE IN A SAFE AND RESPONSIBLE MANNER. OUR

RELATIONSHIP WITH OUR EMPLOYEES IS BASED ON A SHARED COMMITMENT

WITH ETHICS AND CONSTANT LEARNING THROUGH DIVERSE TRAINING

MECHANISMS.

HUMAN CAPITAL MANAGEMENT

28 • Pluspetrol

+2,000COLLABORATORS

TRUSTCOLLABORATIVE WORKENVIRONMENT

DIVERSITYSHAREDVALUE

EXCELLENCE

2013

76

9

67

18

51

7

ANGOLA

2013

767

183

584

139

469

159

ARGENTINA

2013

150

20

130

34

75

41

PPN | PERU

2013

479

44

435

78

334

67

CAMISEA | PERU

2013

729

92

637

56

387

286

BOLIVIA

201312

2,201

348

1,853

325

1,316

560

PLUSPETROL

Total Employees:

Employees by gender:Female

Employees by gender:Male

Employees by gender:Aged 30 or under

Employees by gender:31 to 50 years old

Employees by gender:Aged 51 or over

2014

71

10

61

30

33

8

2014

756

182

574

127

467

162

2014

148

21

127

31

73

44

2014

518

54

464

223

257

38

2014

766

108

658

249

414

103

2014

2,259

375

1,884

660

1,244

355

12. The value reported in 2013 was 2,228, and that included 7 employees of Venezuela and20 of Colombia. In the 2014 Report, these business units were not included in the indicator and therefore the value of 2013 was modified to maintain consistency.


DISTRIBUTION BY BUSINESS UNIT

34%33% 23%7%3%

•• •••

ARGENTINAPPN, PERUCAMISEA, PERUBOLIVIAANGOLA

DISTRIBUTION BY AGE

55%

29%

16%

•• •

FROM 31 TO 50 YEARS OLDAGED 30 OR UNDERAGED 51 OR OVER

DISTRIBUTION BY SENIORITY

41%

28% 17%

14%

•• ••

BETWEEN 5 AND 15 YEARS2 YEARS OR LESSBETWEEN 2 AND 5 YEARS15 YEARS OR OVER

EMPLOYEES BY GENDER

83%17%

••

MALEFEMALE

TURNOVER RATE BY GENDER, AGE AND TOTAL PLUSPETROL

OUR PEOPLE

31 TO 50 YEARS OLD

TOTAL

OVER 51 YEARS OLD

FEMALE

MALE

UNDER 30 YEARS OLD

TURNOVER RATE

5.6% 7.5%

5.1% 4.4%

6.0% 5.2%

DISTRIBUTION BY GENDER, 2014

84%16%

••

MALEFEMALE

POSITIONS IN SENIOR MANAGEMENT

TRAINING PROGRAMS

Understanding that the industry and its technologies

are ever changing, the offer of training is a

permanent ally for the company’s management

and accomplishment of its challenges.

In this way, improvement of the collaborators’

preparation is multiple (including classroom, our

own and specialized trainers in the industry, and

international trainers). Its aim is to cover technical

aspects in each discipline, software management

and leadership.

Our environment and context demand ongoing

training and specialization in the tasks each sector

carries out. Every year, we carry out an Annual

Training Plan (PAC, its Spanish acronym), whose

objective is to align training tools with the

current and future business needs. It includes general

training (industry-specific or Company-related

topics); technical training (related to the

development of new skills and updating topics

specific to the function performed); and

development training (in order to prepare employees

to face future challenges, developing new skills,

capacities and knowledge).

Pluspetrol considers professional development

globally, mindful of opportunities to perform in

multiple areas of the company.

Industry professionals that join the Company find

different growth paths, in accordance to their

profile. To this end, they receive support, training

and counseling.

Being Pluspetrol a reference company in the energy

sector, professional development is considered a

basic step to achieve business management

excellence.

We focus on diverse learning and/or training

experiences: technical courses, development

programs, on the job trainings and scholarship

agreements for postgraduate courses for those

profiles that require so.

MASTERS & POSTGRADUATE STUDIES

In 2014, 20 collaborators were granted scholarships

to take master and postgraduate courses. According

to the general policy, established in 2012, their

selection was based on business needs, their

work performance excellence based on performance

assessments and an analysis of the development

profile; and proficiency in English. The programs

developed are directed to technical subjects

(specializations, master studies, diplomas), as well as

subjects related to management skills development

(MBA / EMBA, for example).

TRAINING AND DEVELOPMENT

30 • Pluspetrol

801TRAINING COURSES OFFERED 1,596 COLLABORATORS

TRAINED

56TRAINING HOURSON AVERAGE PER EMPLOYEE

During 2014, 801 training courses were delivered,

reaching 1,596 collaborators in accordance with their

expectations and needs. Out of all the employees

trained, 13% were women and 87% were men.

Among the activities performed, 83% were technical

courses, and 17% were development and leadership

activities.

LANGUAGE PROGRAM

With the vision of becoming a global company,

we offer our employees the opportunity to access

a language program, which comprises English,

Portuguese and French classes.

This program consists of group, face-to-face classes,

with a total duration of 3 hours per week.

In addition, and as a way of evaluation, students

must take mid-year and end-of-year exams.

During 2014, 278 collaborators made use of this

benefit.

PERFORMANCE ASSESSMENT

Systematically, collaborators are invited to complete

performance assessments. This process enables

the alignment of objectives, as well as discussions

with leaders to find room for development, share

perspectives and challenges.

ON THE JOB TRAINING

DURING 2014, ELEVEN COLLABORATORS

TOOK ON THE JOB TRAININGS. THIS

TRAINING SEEKS TO FACILITATE BUILDING

COMPANY AND BUSINESS AWARENESS

(OR OF A PARTICULAR AREA) THROUGH

HANDS-ON FIELD EXPERIENCE,

INCORPORATING BOTH THEORETICAL AND

PRACTICAL KNOWLEDGE.


In Pluspetrol, we consolidate diverse benefits offers

to accompany the wellbeing of our collaborators,

within the legal framework and pursuant to internal

policies.

Consequently, we offer differential medical insurance,

facilitating access to special plans for all employees

and their immediate family members. During 2014,

632 collaborators from Argentina accessed this

benefit, and 1,292 collaborators from Peru obtained

their EPS (Healthcare Provider Entities) health

insurance.

Further in this sense, we offer additional maternity

leave days to those established by law. During 2014,

22 collaborators from Argentina and Peru made

use of this benefit, in addition to their corresponding

leave. Out of the total employees who took said

maternity leave, 93% returned to their work.

To accompany our collaborators both in their

professional and personal life, we offer gifts for

weddings and births. During the current report year

37 collaborators in Argentina and 86 in Peru

received this benefit. Furthermore, we provide

reimbursement for day care or school bonus,

depending on the policy defined in the different

business units; during this year the following had

access to this benefit: 24 employees in Argentina,

722 in Peru and 62 in Argentina.

Lastly, in some of our facilities we offer transport

passes and the opportunity to do physical activities

in a gymnasium.

In September, the IX edition of the Olimpíadas

Plusdeporte (PlusSport Olympics) were organized in

PPN and Camisea, where Pluspetrol collaborators

participated alongside employees from contractor

companies, in football, volleyball and ping-pong

tournaments, among others.

BENEFITS

OUR PEOPLE

WEDDINGGIFTS

REIMBURSEMENTS FOR DAY CARE

TUITIONBONUSES

TRANSPORTPASSES

13. General training data, language program and safety and health training, are included in the chart.

2,000

1,500

1,000

500

0

375 5

69

66 14

8

189

45

0

171

429

80

1

1,5

96

Argentina Bolivia Camisea | Peru PPN | Peru Pluspetrol

TRAINING COURSES DELIVERED13

NUMBER OF EMPLOYEES TRAINED••

BIRTHGIFTS

ARGENTINAIn 2014, diverse activities were offered, including first

aid and CPR talks for 41 people, training on electrical

risks for 10 people and several talks on preventive

occupational health for 425 collaborators.

At a preventive level, 446 people were immunized

against influenza. The Frequent Flyer Program

continued, which enables to access enquiries,

counseling and vaccination at the Dr. Stamboulian

Infections Center for those collaborators who are

heading for areas with risk; 40 people were assisted

through this program. Also, 217 of our collaborators

had a medical check up.

Finally, our Buenos Aires office has in-company

health care assistance, where a doctor provides

counseling to employees once a week and performs

consultations with doctors from other districts in

the country.

BOLIVIA

As a preventive measure, 148 people were

immunized against influenza, typhoid fever, tetanus,

and hepatitis B.

On the other hand, the business unit has a functional

Occupational Health Management System (SIGES, its

Spanish acronym), which carries out health control

tasks. In this way during 2014 nutritional controls,

exercise at work, ergonomics controls, occupational

health training, drug control and prevention services,

a working atmosphere and healthcare program were

put into practice. Like every year, job entry, intra-

occupational and termination medical examinations

were performed.

HEALTH

FOR OUR COMPANY THE HEALTH OF OUR

COLLABORATORS IS A PRIORITY. THEREFORE,

WE FOCUS ON CARRYING OUT DIFFERENT

TRAINING, PREVENTION AND CONTROL

CAMPAIGNS, ARTICULATED WITH ONE ANOTHER.

2,181 OCCUPATIONAL MEDICAL EXAMINATIONS,

931 FIRST AID TALKS, AND 1,149 INFLUENZA

VACCINES WERE PART OF OUR HEALTHCARE

ACTIVITIES.

32 • Pluspetrol

2,181OCCUPATIONAL HEALTH EXAMINATIONS

931 FIRSTAID TALKS

1,149 INFLUENZA VACCINES

COMMUNICATION

Our Company is growing with respect to challenges

and work spaces. For this reason we search to

improve communication at different levels, such as

the media available, the information shared, and

collaborators’ knowledge. Promoting dialog,

appropriate and transparent information, and change

management are some of the area’s work objectives.

We have different mass communication channels

for employees in the various Business Units: intranet,

digital newsletters, news bulletins, boards and

institutional mailing. In addition, for new staff, an 8

hour organizational induction session is carried out,

whose aim is to provide knowledge and

understanding of the organization.

During 2014, several mass campaigns related to

different business and company initiatives were

implemented. Many of the campaigns have graphic

pieces associated (posters, signs, banners, videos),

as well as briefing talks and/or training. This year,

one of the most outstanding was Environment Day

at Camisea, Peru, where environmental awareness

talks were delivered at educational centers of the

Native Communities, an environmental marathon

was run with the unit’s collaborators, children

participated with drawings and a contest was held

for the best motto related to “Responsible Work,

Healthy Environment.” Further, environmental

awareness sessions were delivered in Pisco, together

with a beach cleaning and bird watching contest in

Paracas bay and Lobería beach.

PLUSPETROL NORTE AND CAMISEA, PERUSeveral health-related actions with were conducted.

In this way 740 employees participated in first aid

talks and 96 collaborators participated in Drug

Control (DEA) management training. 244 people

received external trainings on spirometry, audiometry

and X-rays. Lastly, we delivered training on

dyslipidemia -attended by 124 people-, and diabetes

mellitus -for 62 collaborators.

As a preventive measure, we continued making

occupational health examinations and vaccination

campaigns against influenza, benefitting 2,165

people. We also applied various programs to monitor

vectors causing Leishmaniasis; nutritional counseling,

office gym, hearing health, and occupational health.

Further, The Annual Obesity Eradication Program

was implemented, attended by 108 people, which

included beach-volley, water-polo and triathlon

activities. Also, a nutritional health program was

implemented including counseling and office gym.

To continue with control and monitoring operations,

visual acuity exams and dental assessment charts

were performed on 306 collaborators; and health

recovery medicine for 148 people. Additionally,

health controls were conducted on people belonging

to sectors where food, diners and groceries are

handled.

OUR PEOPLE

MASS COMMUNICATION CHANNELS


(DIGITAL) INTRANET, WHICH CONTAINS THE COMPANY’S COMPILED INFORMATION

BOARDS IN OILFIELDS AND OFFICES

EXCELLENCEBULLETIN

LOCAL (DIGITAL) NEWSLETTERS.

NATURAL RESOURCES

MANAGEMENT

34 • Pluspetrol

ENVIRONMENTWE LEAD OUR ENVIRONMENTAL MANAGEMENT IN A PREVENTIVE

MANNER, SEEKING TO AVOID ALL KINDS OF INCIDENTS AND TO

MINIMIZE POTENCIAL IMPACTS, TOGETHER WITH AN EFFICIENT USE OF

ENERGY AND NATURAL RESOURCES, WE ASSESS AND MANAGE RISKS

INHERENT TO OUR ACTIVITY, AND IMPLEMENT MANAGEMENT SYSTEMS

WITHIN A CONTINUOUS IMPROVEMENT FRAMEWORK.

34 • Pluspetrol

ENVIRONMENT

MANAGEMENT SYSTEM

ENERGY AND CLIMATE

CHANGE

IMPACTMANAGEMENT

Biodiversity Monitoring Program(Camisea, Peru).Photograph: André Liberoff.


To achieve success and sustainability

in the projects we develop, it is crucial to

appropriately manage the environmental aspects

in every phase involved in a hydrocarbon

project, considering management measures

and tools, specific management strategies and

technologies adjusting to environmental and

social sensitivity in every environment where

we operate.

Sandra Martínez Environmental Corporate Manager

36 • Pluspetrol

Early Environmental Assestment

Indentification, dissemination and consultation in

sensitive areas

Assessment of the applicable regulatory framework

Environmental and social due diligence

Identification of best practices in the industry

Internal information to areas involved and authorities

Execution of Environmental and Social Impact

Assessment Studies

Obtain the complementary environmental permits

Strenghten relationships with the stakeholders

Implement Environmental Management Plans (EMPs)

Biodiversity management

Waste management

Energy efficiency

Environmental monitoring and reporting

Supervision and audits

Non Conformities, Preventive and Corrective Actions

Implement environmental investment plans

Environmental risk analysis

Readiness and response to environmental

emergencies

Remediation

Restoration of intervened sites

Research and assessment of potentially impacted

sites

ENVIRONMENTALMANAGEMENT

ASSESSAND SELECT

EXECUTEAND OPERATE

DEFINE

ABANDON

RATIONAL USE OF ENERGY AND NATURAL RESOURCES

CONTAMINATIONAND ADVERSE IMPACTS PREVENTION

BIODIVERSITY PRESERVATION

01

02 03

ENVIRONMENTALMANAGEMENT

Our environmental management is aimed at enabling

that the activities we perform contribute to the

sustainability of both the Company and our

surroundings; therefore, we analyze and manage the

risks inherent to our activity and the environment

where it is set, minimizing the negative impacts and

optimizing the benefits and opportunities offered by

the environment.

We take up the challenge of operating in complex,

remote areas with high biodiversity, sensitive

ecosystems and, in many cases, with the presence of

indigenous communities or rural and urban

populations. That is why the management of

environmental aspects during the entire lifecylce of

our activities is not an option, but a key and essential

element to the success of our projects. We develop

and implement environmental management

standards, processes and tools that favor continuous

improvement in the different phases of our projects’

lifetimes, from the assessment stage to the selection

of areas and ending with their abandonment. These

elements of the Corporate Environmental

Management System are reproduced and adaptedd

in each of the Business Units; in this way, we promote

the development of standardized processes and

practices throughout the Company.

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

In this regard, the CESMS has a direct link with the

management systems implemented by the BUs,

setting corporate guidelines while it feeds back from

local lessons and experiences in a permanent

continuous improvement cycle. In turn, the CESMS

interrelates with other corporate management

systems, all of them within the framework of our

Sustainability Policy guidelines.

2014 NEWS ON THE MANAGEMENT SYSTEMS IN THE BUs

Argentina: The Integrated Management System (IMS)

in the North Area is certified under ISO 14001 since

2007; and under OHSAS 18001 since 2012. During

2014, the corresponding internal IMS monitoring

audits were performed.

Camisea, Peru: The IMS is certified under ISO 14001

and OHSAS 18001 since 2008. During 2014, the

corresponding IMS recertification audit was conduc-

ted for both standards.

Bolivia: The BU has a management system certified

under standard OHSAS 18001 since 2012; likewise,

the same year, an environmental management

system under ISO 14001 was incorporated, although

not yet certified. During 2014, the corresponding

internal IMS monitoring audits were made.

PPN, Peru: During 2014, a review process of the

existing environmental and social management docu-

mentation was initiated, in order to work on an

Integrated Environmental and Social Management

System for the BU.


ENVIRONMENTAL AND SOCIALMANAGEMENT SYSTEMS

Appropriate environmental and social management is

required to achieve Sustainability and, for this reason,

we strive to perform in our operations with respect to

these two key areas. Their management is addressed

in a comprehensive and transversal way throughout

the organization. To this end, the Corporate

Environmental and Community Affairs Office has

started a process for the design and implementation

of a Corporate Environmental and Social

Management System (CESMS), establishing baseline

environmental and social criteria and guidelines which

represent minimum requirements for all of the

Company’s operations.

For the system’s design a two-level approach was

considered, establishing both strategic and practical

objectives.

Strategic Approach

Constitute a key element to position Pluspetrol as a

reference company regarding environmental and

social management, under the guidance of the the

Company’s Vision.

Ensure sustainability, based on sound environmental

and social risks and impacts management.

Deepen the incorporation of environmental and

social aspects as a core element of the business,

promoting efficiency in the entire productive cycle.

Reflect the company’s Purpose with actions

at all levels, keeping to its identity and especially

considering its Values.

Practical Approach

Constitute a useful and baseline tool for new

operations or emerging activities in new areas and

in the different stages of the industry.

Set responsibilities at all levels of the organization.

Prevent/minimize environmental and social risks

and impacts.

Be aligned with the company’s organizational

structure.

Set environmental and social performance objectives

and standardize practices.

SUSTAINABILITYPOLICY

BUs’MANAGEMENT

SYSTEMS

BUs’MANAGEMENT

SYSTEMS

BUs’MANAGEMENT

SYSTEMS

BUs’MANAGEMENT

SYSTEMS

CORPORATEMANAGEMENT SYSTEM

ENVIRONMENTAL AND SOCIAL

MANAGEMENTSYSTEM

ENVIRONMENT

•

•

•

•

•

•

•

•

•

OTHERMANAGEMENT

SYSTEMS

38 • Pluspetrol

Any set of indicators constitutes a signal system

that guides us in relation to the progress we make

concerning the achievement of certain goals and

objectives. Thus, environmental indicators let us

identify the main trends in environmental dynamics.

Since 2008, in every Pluspetrol area of operation a

continuous follow-up and monitoring of a set of

environmental indicators is carried out. These have

been defined in order enable an accurate annual

ENVIRONMENTAL PERFORMANCE IN NUMBERS

diagnosis of the environmental management

performance in every Business Unit, and to conduct,

where necessary, adjustment or improvement

measures based on this traceable and comparable

information.

These tools contribute to the sustainability strategy

design, as they allow us to assess Pluspetrol’s

environmental performance and compare it with the

industry’s international and regional standards.

Camisea, Peru.


PLUSPETROL ARGENTINA BOLIVIA CAMISEA, PERU PPN, PERU ANGOLA

2011 2012 2013 2014 2014 2014 2014 2014 2014INDICADOR

Electric energy consumed (TJ)

Vented and flared gas (MMscf)

GHG emissions(CO

2 eq. MTn)

VOC emissions (t)

SOx emissions (t)

NOx emissions (t)

PM emissions (t)

Number of hydrocarbon spills

Volume of hydrocarbonspills (barrels)

Volume of HC spilt dueto vandalism (barrels)

Number of water/oil mixture spills

Volume of water/oil mixture spills (barrels)

Number of spills of other substances

Volume of spills of other substances (barrels)

Generated hazardous waste (t)

Generated non-hazardous waste (t)

Water consumed (millions of barrels)

4713 4688.1 4416 4487 922.8 60.6 691.8 2805.7 6.2

1062 1885.3 2492.4 2159.5 314.1 32.6 1432.2 378.6 2.1

4201.5 4787.9 2645.4 2607.7 380.8 23.73 1583.5 641.4 -

6.5 12.4 35.1 30.5 - 0.5 30 0 -

2184.5 1210.1 2782.4 1110.3 37 0 148 925.3 -

14,087 16,823.1 10,971.1 11,179.8 1518 0.6 2314 7347.2 -

627.4 379.1 441.1 566.9 1 0 112 453.9 -

20 16 21 12 2 0 0 7 3

233 356 57.6 276.6 5 0 0 263.7 7.9

3007 115 1190 645.9 0 0 0 645.9 0

30 43 47 48 44 0 0 1 3

1466.3 827.3 2224.4 1340.6 1295.7 0 0 37 7.9

45 32 21 19 15 0 0 2 2

3241.4 466 1094 744.7 654.7 0 0 47 43

2065 1966.2 2212 3887.1 308 13.1 1830 1724 12

4097.4 5910.5 4469.5 4347.4 600 83.4 1664 192114 79

95.5 86.8 46.4 37.3 23.8 0.5 2.6 10.4 0.04

ANNUAL EVOLUTION 2014 PERFORMANCE

14. Unlike past years, in PPN, Peru, wastes from drilling projects have been included as part of operational management

Biodiversity Monitoring Program(Camisea, Peru). Photograph: Daniel Silva.

40 • Pluspetrol

The climate change directly or indirectly originated

from human activity constitutes one of the major

environmental challenges in the path towards

sustainable development.

This phenomenon impacts through multiple and

evident transformations in the climate system,

determined by ever increasing greenhouse gases

(GHG) concentrations in the atmosphere. Climate

change, due to the relevance of the activities that

create it and its scope and consequences, not only

constitutes an environmental issue, but also a

development issue with deep impact on society, the

economy and ecosystems. Mitigating climate change

involves limiting and reducing GHG emissions into

the atmosphere.

Through emissions measurements, monitoring and

eventual reduction, Pluspetrol pursues to improve

the environmental conditions of its surroundings.

GHG EMISSIONSOne of the main management tools for this kind

of emissions that Pluspetrol developed and

has implemented since 2010, is the Corporate GHG

Emissions Inventory.

Every year, through the use of the inventory, a

review of the methodology and the sources

considered for the calculations is carried out. Thus,

we increasingly achieve better data quality. This

assures a reliable data base for the definition of the

Company’s action strategies regarding the

management and reduction of GHG emissions.

How do we manage energy efficiency and

climate change projects?

The implementation of certifiable energy efficiency

and/or GHG emissions reduction projects comprises

four stages:

1. Identification of project alternatives

2. Assessment of project alternatives

3. Project Execution

4. Results Disclosure

These stages are addressed through an

interdisciplinary work group where people

responsible for different areas in the Company

are engaged.

Pluspetrol operations consume a total of 4,486,996.7

GJ of electric energy, out of which it only imports

74,427.62 GJ from the grid, producing with its own

on-site power plants 4,412,569.10 GJ.

ENERGY EFFICIENCY& CLIMATE CHANGE

15. The International Oil and Gas Producers (IOGP) Association has an Atmospheric Emissions Inventory Categorization, as per this guideline, Pluspetrol’s Corporate Inventory is a Level 3 of 5 that contemplates IOGP.

98% OF THE ELECTRIC ENERGY CONSUMED IS SELF GENERATED CORPORATE GHG EMISSIONS INVENTORY:

IN ORDER TO HAVE ACCURATE DATA ON GHG

EMISSIONS, AND TO BE ABLE TO DEFINE FUTURE

IMPROVEMENT OBJECTIVES BASED ON

TRACEABLE AND COMPARABLE INFORMATION,

SINCE 2010 WE CALCULATE DIRECT EMISSIONS

OF THESE GASES THROUGH THE

IMPLEMENTATION OF THE CORPORATE

INVENTORY.

IN EVERY BUSINESS UNIT CARBON DIOXIDE (CO2),

METHANE (CH4) AND NITROUS OXIDE (N

2O)

EMISSIONS FROM ALL COMBUSTION SOURCES

ARE CALCULATED, AS WELL AS CH4 FLASH

EMISSIONS IN TANKS.

THIS IS A CATEGORY 3 INVENTORY, ACCORDING

TO IOGP15 GUIDELINES.

TREATMENT AND RE-INJECTION OF PRODUCTION WATER

OIL ANDGAS EXTRACTION

OTHER MINOR USES

TREATMENT FACILITIES

OIL TRANSPORT TO ITS TREATMENT POINT

ENERGY CONSUMPTION - GHG EMISSIONS

PLUSPETROL HAS A CDM PROJECT REGISTERED

SINCE 2012, WHICH IS PART OF THE NATIONAL

PORTFOLIO OF CARBON PROJECTS OF PERU,

LED BY THE NATIONAL ENVIRONMENTAL FUND

(FONAM).

IT IS THE FIRST CDM PROJECT IN LATIN AMERICA

FOR THE UPSTREAM SECTOR.


ENVIRONMENT

The strategies we develop in order to reduce our

GHG emissions are associated to the following

guidelines:

Energy Efficiency in our operations

Incorporation of the energy efficiency concept in our

projects’ design

Identifying and developing technological and

processes improvements to register new projects in

the framework of the United Nations Clean

Development Mechanism (CDM).

Gas Flaring and Venting Reduction

•

•

•

•

GHG EMISSIONS PER PRODUCTION UNIT, MTNCO

2E/MBOE– 2013/ 2014 EVOLUTION

80

60

40

20

0

• 2013 • 2014

ARGENTINA BOLIVIA CAMISEAPERU

PPNPERU

15.3

1

PLUSPETROL

13.8

2

0.2

5.6

10 11

61

67

13.2

13.9

42 • Pluspetrol

ENERGY EFFICIENCY

Under the energy efficiency concept we search to

optimize and reduce the use of energy in those

processes and operational projects where feasible.

This strategy also involves incorporating the

consideration of a lower use of energy in the

Company’s new projects.

Direct and indirect consumption of energy

Direct consumption of energy makes reference to

fuel consumption (primary energy) used for energy

self-generation, the development of activities, vehicle

fleet, among others. On the other hand, indirect

consumption refers to electric energy bought from

an external source of generation. Below we include,

on the one hand, the primary energy consumed

(direct consumption) by type of fuel, and the

total electrical energy consumed (self-generated and

compared to an external source of generation) by

operation.

TOTAL ELECTRIC ENERGY CONSUMED PER PRODUCTION UNIT, PER OPERATION IN GJ/MBOE - 2011-2014 EVOLUTION

300

250

200

150

100

50

0

27.2

30

.6

7.3

7.4

12.5

4.8

4.7

5.6 2

7.6

26

.7


30

.2

3.4

270

.52

22.0

33

.5

14.3

9.7

29

1.8

5

23

.5

26

2.0

26

8.0

Angola

PRIMARY ENERGY CONSUMED PER PRODUCTION UNIT16, PER OPERATION IN GJ/MBOE - 2014

37% of these fuels are used to generate electricity

26.61

183.18

0.20

Gas oil

Natural Gas

Gasoline

Camisea, Peru.

FLARED AND VENTED GAS17 PER PRODUCTION UNIT IN SCF/BOE18 – 2011-2014 EVOLUTION

GAS FLARING AND VENTING

In some cases during hydrocarbon production,

besides oil, associated gas coming from the same

reservoir is extracted. A big part of this gas is used or

preserved for its use; however, part of the gas is flared

and, in some cases, released into the environment

(venting) due to technical, regulatory or economic

constraints.

OTHER EMISSIONS

Besides greenhouse gas emissions, hydrocarbon

combustion generates other emissions, such as

volatile organic compounds (VOCs), sulfur oxides

(SOx), nitrogen oxides (NOx) and particulate matter

(PM). Emissions of these substances are monitored

regularly in order to check that the they are within

the limits of the applicable legal framework, so as

to prevent negative impacts on the environment

immediate to our operations.

ENVIRONMENT

KEY MITIGATION ACTIONSAND THEIR RESULTS

In Pluspetrol we record and assess GHG emissions

levels resulting from our activities. Based on this

information, we seek strategies and new technologies

that enable us to reduce this kind of emissions.

Consequently, throughout 2014 we performed a series

of key mitigation actions in some BUs which include

the design of energy efficiency processes in new

and ongoing projects, and a decrease of flared or

vented gas.

16. Turbo JP1, HFO (Heavy Fuel Oil) and Residual consumption have not been included in this report.17. For the formulation of the gas flaring and venting coefficient indicator, production in Río Colorado District was not considered in Argentina and Pluspetrol totals, as no data is available on flared and/or vented gas in this operation.18. Standard cubic foot. A cubic foot equals 0.028317 cubic meters.

NEUQUÉN AREA, ARGENTINA

ANNULAR GAS CAPTURE PROJECT IN AGUADA BAGUALES FIELD

Objective: to reduce the amount of vented gas in

productive oil wells, in order to recover andexploit it.

The project is conducted in the well cluster situated

in the Aguada Baguales Field, which produce oil by

means of mechanical extraction and annular gas,

which is vented into the atmosphere. After the

analysis of different gas recovery alternatives, we

chose to proceed with a capture technique based on

applying a pressure lower than the atmosphere. This

technique involves construction of a HDPE pipeline

network that withdraws annular gas from a series of

wells to then transfer it through pipelines network to

a compressor with an 18,000 m3/d gas operational

capacity, which feeds an electric power generator.

Project progress: in 2014, work was done on the

project’s design and environmental permits were

obtained for the construction and assembly of the

different facilities required. Its construction and

gradual implementation is expected throughout 2015.

It’s worth mentioning that based on this project,

new low pressure gas extraction and marketing

possibilities open up in the area.

OTHER EMISSIONS PER PRODUCTION UNIT IN TON/YEAR. PLUSPETROL TOTAL, 2013/2014 COMPARISON. TOTAL BUs 2014

PLUSPETROL

2013 2014

35.1 30.5

2782.4 1110.3 10,971.1 11,179.8

441.1 566.9

ARGENTINA

2014

-

37.0

1518.0

1.0

BOLIVIA

2014

0.5

0.0

0.6

0.0

CAMISEA

2014

30.0

148.0

2314.0

112.0

PPN

2014

0.0

925.3

7347.2

453.9

VOC Emissions (t)

SOx Emissions (t)

NOx Emissions (t)

PM Emissions (t)

2011

19.7

0.7

1.8

33.1

-

6.7

2012

21.5

6.6

4.8

46.5

-

10.9

2013

12.96

1.0

10.8

39.8

-

12.4

2014

11.4

7.7

9.7

39.4

1.9

11.3

Argentina

Bolivia

Camisea, Peru

PPN, Peru

Angola

Total Pluspetrol


GENERATIONREDUCTION

42 • Pluspetrol44 • Pluspetrol

GARRAHAN HOSPITAL FOUNDATION

RECYCLING PROGRAM

We continue collaborating with this institution

through a recycling program, donating paper and

plastic lids that we collect from offices in Buenos

Aires and Neuquén every month.

In 2014, we contributed:

17,681 kilos of paper, preventing the felling of300 medium-sized trees.38 kilos of lids, representing 15,200 plastic lids, approximately.

Based on the new Waste Management Standard, the

PIMAR Project was implemented. This project was

conducted during 2014 in PPN operations. It is

focused on achieving an integral waste management

in blocks 8 and 1AB.

ENVIRONMENTALIMPACTS MANAGEMENT

During the last 4 years, the total number of spills has

decreased by 18%. This is so thanks to the fact that

during that same period, drops -of between 1% and

13%- in this indicator were recorded in all BUs

(except for Angola, which started production in mid

2013). This drop was steeper between 2011 and 2012.

WASTESCLASSIFICATION

SEGREGATIONAND COLLECTION

TREATMENT - FINAL DISPOSAL

EXTERNALWASTE

TRANSPORT

TEMPORALWASTE STORAGE

CORPORATE STANDARD

OF WASTES MANAGEMENT

NUMBER OF SPILLS - 2011/2014 EVOLUTION

120

100

80

60

40

20

0

101

92 8983

30

44 47 47

26

1621

19

2011 2012 2013 2014

PLUSPETROL’S TOTAL MIXTURE SPILLSHYDROCARBON SPILLSOTHER SPILLS

••••

45

3221

17

Planta Ramos, Argentina.

A corporate model for environmental, social and

operational risk management is implemented in

order to minimize the operations’ exposure level,

to prevent potential impacts and act proactively

to make decisions in front of potential hidden

risks. This model, which is being consolidated

since 2012, is aligned with the Operational

Excellence approach developed in our Company.

A specific methodology is used through which risk

surveys and classification is made, as well as

identification of treatment actions, by means of

interdisciplinary workshops. Based on the informa-

tion gathered, risk maps are elaborated for every

BU. These maps have follow-up measures linked to

the treatment actions for the high and very high

exposure level risks.

At corporate level the information generated at

each BU is used to define common risk categories

which make up the baseline corporate risk map.


ENVIRONMENT

Environmental impact assessments; Environmental

management plans; Environmental Procedures,

Action plans, Activity-specific environmental

guides; Audits; Environmental indicators,

Contingency plans.

In each project, whatever the phase of the cycle

the business is in, Pluspetrol performs the

early identification, prediction and assessment

of the potential physicochemical, biological,

social and cultural impacts based on the

elaboration of specific and detailed baselines in

the working area.

The main aspects we preventively and proactively

manage to avoid and minimize their impacts on the

environment are:

Hazardous and non-hazardous waste management

Drilling wastes management

Spill events

Potentially impacted sites and environmental

remediations

Produced water management

●

●

●

●

●

MANAGEMENT TOOLSAND PRACTICES

IMPLEMENTATION

IMPACT IDENTIFICATION

AND ASSESSMENT

RISKMAPPING

Management of the environmental impacts

associated to the activities we peform is carried out

based on three instruments:

46 • Pluspetrol

WASTES MANAGEMENT

During 2014, the Corporate Environmental

Wastes Management Standard was

developed, focused in establishing the

minimum requirements for environmental

wastes management in our operation

areas. These requirements aim to achieve

wastes identification and characterization

from their source, implementing an

appropriate segregation and collection

system, safely transporting them, and

implementing more efficient treatment

and/or final disposal alternatives from the

technical, logistics and environmental

viewpoints.

The criteria defined in the standard are

considered as minimum requirements in

the waste management plans of every

BU; among those criteria, the

consideration of reduction, reuse,

recycling and recovery alternatives

is established, according to their

applicability, as well as the

implementation of sufficient records

to ensure an appropriate traceability

of wastes and compliance with the

applicable laws in each of the sites.

Considering the previous points, and in

order to monitor compliance with the

waste management plans, regular

monitoring reporting as well as internal

audits are done.

Thanks to these efforts during 2014, we

recycled 36 % of our non-hazardous

wastes, including plastic wastes, paper,

cardboard paper, glass and wood.

As per hazardous wastes, such have been

managed according to the applicable

legislation in each operation site. The

treatment or final disposal techniques

vary depending on the local

characteristics and complexities of every

site. In all cases, hazardous wastes are

managed by authorized operators, who

perform the final disposal according to

the wastes’ characteristics and the

applicableregulations.

TRAINING

They reach all of our own and contractors’

staff.

It refers to appropriate waste

management.

It involves staff training in areas in

operation, as well as administrative areas,

which provide operations support (e.g.,

Supplies, Facilities, etc.).

AUDITS

It is planned to perform, at least, two

audits aimed at:

Internal waste management.

External waste management (transfer,

treatment, recycling, final disposal).

NON-HAZARDOUS WASTES MANAGEMENT

64%

36%

••

FINALDISPOSALRECYCLED

Each BU performs waste treatment accordingto the applicable legal requirements. Waste Management Plans include treatment measures that allow minimizing the amountof wastes to dispose of in-situ or ex-situ.

Wastes are conditioned for their withdrawal from the areas in operation; keeping the necessary records required by law and Pluspetrol’s specific procedures.situ or ex-situ.

It is performed in sites conditioned to such purpose, based on the characteristics and requirements of the wastes stored.situ or ex-situ.

Since the projects and/or activities’ design phase we perform an analysis of alternatives that enable reduction of waste generation at the source.

All BUs classify their wastes according to the applicable legislation; the minimum requirement is the separation of Hazardous Wastes and Non-hazardous Wastes.

Every BU performs wastes segregation according to the classification criteria; sorted collection is carried out maintaining the necessary records to ensure wastes traceability and follow-up.

WASTES CLASSIFICATION

SEGREGATION AND COLLECTION

GENERATION REDUCTION

TREATMENT - FINAL DISPOSAL

EXTERNAL WASTE TRANSPORT

TEMPORAL WASTE STORAGE

CORPORATE STANDARD OF WASTES

MANAGEMENT

•

•

•

•

•

PLUSPETROL NORTE, PERU

COMPREHENSIVE WASTES MANAGEMENT PLAN - PIMAR

As part of our commitment to perform the

appropriate environmental management

of wastes in PPN, and within the corporate

standard framework mentioned above,

we initiated the implementation and

dissemination of a Comprehensive Waste

Management Plan –PIMAR for its Spanish

acronym-, which main objective is to

develop the effective and responsible

management of all wastes generated in

the operation of the Business Unit Blocks.

The PIMAR includes the identification,

classification, management and disposal

of the wastes generated, involving the

entire generation chain: from the hiring

and purchase of services and materials,

and their transfer to operative areas,

to their use, to the disposal of wastes

associated to such products, goods and

services. Therefore, PIMAR not only

involves operative areas, but also requires

the engagement of the Supply Chain,

Projects, Logistics, Legal Department,

etc. The coordinated engagement of all

these areas enables the identification

and application of effective reduction

measures in the place of origin.

PIMAR Principles

Reduction in the place of origin

Segregation

Reuse, recovery and recycling

Temporary storage

Treatment

Transfer and final disposal

Management control

Training and raising awareness


ENVIRONMENT

19. NTP 900.058 2005: Environmental Management. Wastes Management. Color code for waste storing devices.

During 2014, the implementation focus

was placed on the reduction in the place

of origin, training and segregation, and

temporary storage.

To achieve reduction in the place of

origin, the measures implemented start

at the beginning of the process, from the

hiring of services and the material and

input purchase, to the later appropriate

management of wastes generated in

the operation. To this aim, we develop

workshops which take part in the

purchase, transfer and use of materials, in

order to evaluate alternatives that enable

us to modify: consumption, packaging

management (reuse, net weight/gross

weight ratio), wrappings use, among

others. In turn, in each block, measures

to improve general waste management

were implemented; the most significant

achievement of this phase being the

construction of wastes flowcharts, which

make use of the “mass balance” concept,

connected to the materials coming in into

the operation, with the wastes generated

from such materials. This tool has

enabled us to identify the main lines of

work and to focus actions on

implementing improvements in the entire

waste management process. Regarding

segregation and temporary storage, these

are performed at green points, which are

sites especially conditioned to store

wastes in a temporary and segregated

way until their collection by the internal

wastes operator. During 2014 the Green

Dots they were adjusted to a new

color code, voluntarily comforming to

the Peruvian Technical Standard

9000 o58-200519, which includes waste

classification into 8 types: Reusable:

hazardous, organic, metal, plastic, glass,

paper, cardboard paper; Non-reusable:

hazardous and non-hazardous. This new

classification enables a more efficient

waste segregation in order to reduce the

mass of those that are effectively sent for

their final disposal; in this way, we

generate 3 Rs alternatives: reusing,

recovering, recycling.

OF WASTES

REDUCTION AT THE PLACE OF ORIGIN

SEGREGATION IN 7 COLORS

REUSE, RECOVERY AND RECYCLING

TREATMENT AND/OR FINAL DISPOSAL

AMOUNT

•

•

•

•

•

•

•

•

Pavayacu, Pluspetrol Norte, Peru.

48 • Pluspetrol

ARGENTINA

DRILLING WASTES TREATMENT

The system used in Argentina’s operations consists of closed loop circuits set to

manage cuttings and drilling muds, in order to reduce the operations’

environmental impact and generation of wastes which later need to be sent to

treatment and final disposal.

In the case of Neuquén area a treatment plant was set up, where we can

separate, through different mechanisms, the muds’ liquid fraction. These fluids

are later sent to the Salt Water Injection Plant. The solids remaining from each

phase of the treatment process are sent to drying cells where, after being

sampled to ensure their innocuity (according to the regulations in force), are

disposed of in quarries operated within the framework of Degraded Zones

Recovery Projects.

NEUQUÉN AREA PROCESS:

20. These wastes are not included in the hazardous waste indicator, as they are eventually generated in drilling projects.

SECONDARY RECOVERY THROUGH SALT WATER INJECTION PLANT (PIAS) (ONLY IN CENTENARIO FIELD PLANT)

DEHYDRATIONPLANT

REPOSITORY

MUD

CUTTING

DRYINGLOT

FLUIDS

FLUIDS

SOLIDS

CLARIFIEDWATER

CENTRIFUGAL SEPARATION

FINAL DISPOSAL(AUTHORIZED QUARRIES)

SOLIDS(35% HUMIDITY)

SOLIDS(50% HUMIDITY)

PRE-TREATMENT

CLARIFICATION

DRYING CELLS

DRILLING EQUIPMENT

DRILLING WASTESMANAGEMENT20

As part of the drilling activities, solid

wastes known as cuttings are generated

(made up of small pieces of rock and

excess mud). In this sense, drilling with

the best environmental and quality

industry standards requires defining an

appropriate methodology for waste

management and final disposal as a key

aspect of this activity’s environmental

management.

Some of the techniques used to manage

drilling wastes at Pluspetrol are as

follows:

Re-injection of drill cuttings.

Camisea, Peru.

Assisted landfarming. Bolivia.

Re-injection of drill cuttings.

Pluspetrol Norte, Peru.

•

•

•


ENVIRONMENT

Another important element that enables us to manage spills is the follow-up and

assessment of the corresponding environmental indicator. To this end, we count

with a specific procedure for reporting spills, which we classify into three types

so as to make a detailed analysis of the trends in every case; the categories are:

Hydrocarbon Spills, Mixture Spills (hydrocarbon and water mixtures), and Other

Substances Spills (which comprises products not included in the other

categories).

SPILLS MANAGEMENT

In case of a spill in any of the sites where

our operations are set in, in addition to

deploying our response plans in order to

minimize potential environmental

impacts, we proceed to investigate the

causes of such event.

The investigation of the causes of a spill

is very useful to make the necessary

adjustments and improve our actions to

prevent this kind of events, both in

relation with the facilities’ maintenance

and inspection plans, as well as training

and awareness actions.

THE INVESTIGATION IS PERFORMED BY

A COMMITTEE FORMED ACCORDING

TO THE CHARACTERISTICS OF THE

RELEVANT EVENT. THIS COMMITTEE IS

MAINLY DEVOTED TO INVESTIGATING

THE INCIDENT/ACCIDENT IN ORDER

TO FIND ITS BASIC AND IMMEDIATE

CAUSES. THE INVESTIGATION

INCLUDES INSPECTING THE PLACE

WHERE THE EVENT OCCURRED,

INTERVIEWING WITNESSES,

REVIEWING PROCEDURES, AND ALL

THE RELEVANT DOCUMENTATION; AS

WELL AS ALL THE EVIDENCE AND

BACKGROUND INFORMATION THAT

COULD BE FOUND. CONSIDERING ALL

THE DATA GATHERED, WE PROCEED

TO ANALYZE THE CAUSE-EFFECT.

LATER, A FINAL INVESTIGATION

REPORT IS GENERATED, WHERE THE

PROCESS’ CONCLUSIONS AND

RECOMMENDATIONS ARE SHOWN.

SPILL INVESTIGATION PROCESS

(Site inspection; witness interviews; procedures review; background analysis; etc.)CAUSE-EFFECT

ANALYSIS

INVESTIGATIVE COMMITTEE FORMATION

INVESTIGATION DUTIES

FINALREPORT

DEFINITION OF CONCLUSIONS AND

RECOMMENDATIONS

Assessment of spill response capacity

During 2014 we completed the

implementation of the spill response

capacity assessment corporate project,

which consisted in the assessment of all

the aspects that make up an effective

response: response preparation,

contingency plans, training, human

resources and equipment available, and

current drill plans in the framework of the

Peruvian operations (PPN and Camisea).

As a result of the analysis a

recommendation to build sensitivity

maps arose, so as to enable focusing and

optimizing response mechanisms in the

face of spill events.

50 • Pluspetrol

7.0

2

Spills of other substances

This category includes spills of substances other than hydrocarbons, associated

to production activities, such as water based drilling fluids, produced water, or

injection water. In 2014, the volume spilt decreased 28%, reaching a total of

3.9 BBLS/MMBOE spilt, thanks to the implementation of scheduled maintenance

plans, facilities’ inspections, as well as different training courses and awareness

raising actions.

VOLUME OF WATER/OIL MIXTURE SPILLS PER PRODUCTIONUNIT, PER OPERATION (BBLS/MMBOE) – 2011-2014 EVOLUTION

80

60

40

20

0

7.1

3


47

.01

0 0 3.8

5

Angola

0

12.8

14.6

5

8.6

4.7 11

.08

39

.3

20

.2

69

.25

0 0 0 0 0 0

WATER/OIL MIXTURE SPILLS

1.4

5

0.2

9

Due to the implementation of the abovementioned investigation methodology,

we could conclude that during 2014, the spills occurred as a consequence of

vandalism have generate higher volumes of hydrocarbon spill (70% of the total

volume spilt), although in terms of the number of events occurred, they only

represent 24%.

VOLUME OF HYDROCARBON SPILLS PER PRODUCTION UNIT, PER OPERATION (BBLS/MMBOE)22 - 2011-2014 EVOLUTION

40

30

20

10

0

7.1

3


0.1

8

0 0

27

.43

Angola

11.9

27.3

3.12

1.4 22.6

1.1

0.2

5

0 0 1.9

6

0 0.1

0.0

3

HYDROCARBON SPILLS21

21. These spills include leaks of crude oil and its derivatives (gasoline, distillates, asphalt, lubricants, kerosene) bigger than 1 barrel, which reach the environment. 1 barrel = 0.162 m3. 22. It does not include spills as a consequence of vandalism.

ENVIRONMENT


CAMISEA, PERU

ENVIRONMENTAL SENSITIVITY MAP OF THE NGLFP23

In Camisea, the elaboration of an Environmental Sensitivity Map was initiated in

the marine and coastal environments of the NGL Fractionation Plant and in the

buffer zone of the Paracas National Reserve, in order to generate a planning and

response tool in the case of contingencies that might happen in the operations

and activities related to the Pisco Camisea Marine Terminal.

For its preparation, international reference indicators, methodologies and criteria

were used, and, as a first measure, the area of influence of the operations was

delineated. The subsequent phases included:

Biological resources mapping: it was performed using the vast information on the

area’s characteristics offered by the Biotic and Abiotic Monitoring Program

conducted by Pluspetrol since 2003. Work was done on the identification of areas

with the highest concentrations of individuals and which represent development

sites for the most sensitive phases in the lifecycle of certain species. The groups

of species that were mapped included those more vulnerable and sensitive to

hydrocarbon spills and disturbances related to response activities; threatened,

endangered or rare species; and species that have commercial or recreational

relevance.

Definition of the kind of coastline: it facilitates determining the capacity of

penetration and/or burial and movement of the hydrocarbon on the coast,

exposure to waves and tidal energy that determine the hydrocarbon’s persistence

on the coast along time, the biological productivity and overall sensitivity, and

clean up easiness.

Mapping of stakeholders in the coastal area of influence in Pisco: those that could

be potentially involved if an emergency/contingency response event was

considered, identifying their vulnerability and resilience in front of a spill event in

the coastline and marine environments.

This process, still ongoing during 2015, will let us have a strategic Environmental

Sensitivity Map, at a 1:50,000 scale, and with tactic maps divided into sectors in

30 quadrants within the area of influence, which show in more detail the areas’

sensitivity that will require attention in case of a spill event.

23. Natural gas liquids fractionation plant.

•

•

•


REGULATORY COMPLIANCE OF SOIL ENVIRONMENTAL QUALITY STANDARDS (SOIL ECA)

During 2013 and 2014, the Ministry of

Environment (MINAM, Peru) approved the

regulatory framework associated to the

Soil Environmental Quality Standards

(Soil ECA standard, its complementary

provisions and technical guides).

To comply with this last regulation,

PLUSPETROL NORTE (PPN) contracted

the environmental engineering company

CH2MHill, a leading global environmental

services consulting company to,

pursuant the current legislation and in

line with the international standards,

research potential areas of interest in

blocks 1AB and 8.

Such projects consist of an initial Site

Identification Phase, whose objective is

to confirm or rule out the existence of

affected zones in these blocks by

determining whether soil concentrations

exceed the environmental quality or

background level standards, through the

collection of representative samples and

the analysis of toxicological or

ecotoxicological parameters inherent to

the Oil & Gas industry, indicated in the

applicable environmental regulations

currently in force in Peru.

During 2015, we plan to submit to the

Authorities the information resulting from

the Identification Phase through the

submittal of Site Identification Reports.


POTENTIALLY IMPACTED SITES AND REMEDIATIONS

Investigation, assessment and application of corrective actions

in potentially affected sites.

In September, 2014, the corporate standard for the investigation, assessment and

eventual application of corrective actions in affected soils, sediments and water

bodies was approved. The objective of this standard is to ensure: i) that the sites

affected or potentially affected by past and/or present operations, are duly

investigated and assessed from an environmental viewpoint, and ii) that based on

the results of the evaluations performed we proceed to define, implement and

assess the effectiveness of the corrective actions necessary to ensure the

protection of human health and the environment.

In this way we guarantee the application of the best practices and the generation

of all the information necessary to support management and operational decisions.

Based on the standard, contaminated sites are managed according to 5 phases

where the best techniques and practices on the subject are applied, which allow

to ensure the traceability and robustness of the whole process.

•

IDENTIFICATION

PRELIMINARY ASSESSMENT

ENVIRONMENTAL CHARACTERIZATION

RISKASSESSMENT

REMEDIATION/REHABILITATION


Remediations

The aim of environmental remediations is

to restore the sites that may be impacted

by spill events, as well as those sites

intervened during operations which, once

completed (in the abandonment phase),

must be brought back to their previous

condition or else, an environmentally safe

condition.

24. Bioremediation: Bacterial hydrocarbon degradation process. Different techniques are used to accelerate the degradation rate through the addition of fertilizers containing nitrogen and phosphorus, which in turn favor the proliferation of living microorganisms that degrade the spilt hydrocarbon.

Before and after the restoration work of a location in Aguada Baguales (Argentina).


LIDERA PROJECT (SPILL CLEANING AND ENVIRONMENTAL REMEDIATION)

In the light of the occurrence of a series of spills due to acts of vandalism between

2010 and 2013, the LIDERA Project (Spill Cleaning and Environmental Remediation)

was created, led by PPN’s Environmental Management Area. Said project summons

highly specialized professionals to carry out control, cleaning and remediation work

at the different impacted sites that exist as a consequence of spills derived from

acts of vandalism in Block 8.

These cleaning tasks involve the implementation of in situ technologies, which

represent an alternative to the final disposal of contaminated soils in secure landfills

as hazardous wastes.

The activities that LIDERA carries out start with hydrocarbon recovery, which

involves the removal of free hydrocarbon from the incident zone through physical

and mechanical methods.

Then, the bioremediation itself is implemented24.

In late 2014, the following results were achieved:

4 environmental incidents have been 100% concluded in relation with the area’s

cleaning and remediation.

9 environmental incidents are being cleaned and remedied.

Recovery of approximately 6675 barrels of crude oil, which have been incorporated

into the Block’s production through the installation of connections to the existing

oil pipelines, which resulted in substantial resource savings, as airborne transport

of fluids from the impacted sites to the batteries was eliminated.

Cleaning and remediation of 34,018.6 m2 of soil.

Implementation of biopile-based bioremediation technologies in an area prepared

for that purpose, leading to a substantial reduction in the amounts of transported

and disposed hazardous wastes.

Generating work and staff training in the local communities within Bock 8’s area

of influence.

ARGENTINA

RESTORATION PLAN FOR “AGUADA BAGUALES”DEGRADED SITES

This degraded areas rehabilitation project in Neuquén’s operations started with a

survey of the condition of the abandoned well locations in the Aguada Baguales

CNQ-12 area, to later determine the necessary environmental remediation works,

such as widrawal of calcarous material, closure of old accesses, closure of auxiliary

entrance paths, and reduction of existing locations using restoration techniques,

thus complying with the province’s legal standards.

During 2014, progress was made in reconditioning tasks in 5 locations. The sites

have been scarified, access roads have been closed and 6350 m3 total of

calcareous material have been carried away (material that was collected for its

later reuse in road restoration, works within the field and construction in other

locations).

•

•

•

•

•

•

•

Lote 8, Pluspetrol Norte, Peru.

The uses given to freshwater coming from different

surface and underground sources may be grouped in

5 general types : camps and offices, plant

consumption, drilling, secondary recovery, and

others. The highest consumption is originated in,

firstly, plant consumption, which includes industrial

processes (such as crude oil treatment), and

secondly, the secondary recovery process.

WATER MANAGEMENT

Our water resource management is aimed at

reducing the amount of surface and/or underground

water extracted, incrementing reuse of treated water

and making use of produced water in the operations

where it is generated; it also aims at reducing the

amount of domestic effluents generated and

implementing industrial and domestic wastewater

treatment systems to ensure the discharge quality

and harmlessness. On the other hand, Zero Discharge

ofproduced water is a standard in all our operations.

To meet the water resource management goals, the

action pillars are defined as follows:

Adopting the best practices available in the industry,

adjusting them to the complexity of the

environments where we operate.

Investing in the development of new domestic and

industrial wastewater treatment technologies.

Developing process improvements that are key to

reducing freshwater use.

Carrying out training and awareness raising

campaigns on the efficient use of water.

NATURAL RESOURCES MANAGEMENT

•

•

•

•

6%

14%

40%

2%

38%

•

••

••

OTHERS (IRRIGATION OF GREEN AREAS, PIPELINES, WORKSHOP, PLANT WASH, FIRE SYSTEM TESTS)

CAMP/OFFICES

CONSUMPTION ATTHE PLANT

DRILLING

SECONDARY RECOVERY

TYPES OFCONSUMPTION

Camisea, Peru.

54 • Pluspetrol

0.0

4

0.6

0.5

0.2

1.4 1.

5

0.9

0.0

3

0.0

3

0.0

2

0.1

0.0

4

0.0

4

WATER CONSUMED PER PRODUCTION UNIT,PER OPERATION (MBBLS/MBOE) - 2011-2014 EVOLUTION

2.5

2

1.5

1

0.5

0

UNDERGROUND1%

SUPERFICIAL99%

••

UNDERGROUND96%

SUPERFICIAL4%

••

UNDERGROUND91%

SUPERFICIAL9%

••

2.1

2

0.9

0.1

2

0.0

2

1.1

UNDERGROUND2%

SUPERFICIAL98%

••

In all the cases we selected the most appropriate efficient use or water resource reuse alternatives according to the technology available,the operations performed in each site, and the types of consumption and characteristics belonging to the operations.

Argentina Bolivia Camisea | PERU PPN | PERU PluspetrolAngola

UNDERGROUND25%

SUPERFICIAL75%

••

0.2

1.6

Since 2009 we have a 100% of produced water

re-injection in all our operations. This means that in

all production sites we operate under the “Zero

Discharge” concept, in reference to the disposal or

reuse of the produced water generated, either by

injection in dedicated disposal wells or else through

treatment and reuse for other activities. In the

PPN and Argentina Business Units (Neuquén and

Río Colorado Areas), produced water management

is performed through different techniques.

Total production

water volume during

2014 (MBbl/d)

ARGENTINA

313.84 3.09

BOLIVIA

0.58

CAMISEA | PERU

1000.47

PPN | PERU

LIQUID EFFLUENTS: PRODUCTION WATER

1.01

ANGOLA

OF PRODUCED WATERRE-INJECTED. INNOVATION AND TECHNOLOGICAL FOREFRONT100%


ENVIRONMENT

56 • Pluspetrol

BIODIVERSITY

CORPORATE STANDARD OF BIODIVERSITY MANAGEMENT

In order to establish the general criteria

that should be considered for Biodiversity

protection and management in the areas

of influence of our facilities, activities,

operations and new projects, we have a

Corporate Standard of Biodiversity

Management in force since 2010.

1. Habitat loss and degradation

(fragmentation) / Changes in the land use

2. Introduction of invasive species

3. Overexploitation

4. Contamination

The purpose of the main actions defined

in the Standard is to prevent and

mitigate those potential impacts; to that,

the following lines of work were defined:

complying with the applicable legislation,

identifying the area of influence

and its sensitivity, elaborating thorough

biological baselines and developing

limited environmental impact evaluations

(for new projects), managing Biodiversity

impacts, training and raising awareness

of our own employees and contractors,

promoting biodiversity research by

means of programs jointly developed

with scientific institutions and other

stakeholders.

ENVIRONMENTALDISSEMINATION

AND EDUCATION

INTERACTION WITH STAKEHOLDERS

PROTECTED AREAS AND SPECIES

MANAGEMENT OF IMPACTS ON BIODIVERSITY

TRAINING AND RAISING AWARENESS

RESEARCH AND DEVELOPMENT

BIODIVERSITY STANDARD

Biodiversity Monitoring Program(Camisea, Peru).Photograph: Enrique Castro.

MANAGEMENT OF IMPACTS ON BIODIVERSITY

Developing biodiversity Baselines,

identifying potential positive and/or

negative impacts

BIODIVERSITY MONITORINGPROGRAM (BMP) IN CAMISEA, 10 YEARS OF IMPLEMENTATION

This is a long-term scientific program

that, since 2005, performs monitoring in

the area, in order to establish whether

there is negative impact to biodiversity,

and if so what is its extent and origin,

while at the same time it generates

recommendations for the prevention and

mitigation of said impacts on biodiversity

in the project’s area.

During the 10 years of implementation,

82 monitoring campaigns were carried

out -including terrestrial biota, aquatic

biota and the use of natural resources in

native communities- where more than 80

scientists and 250 native co-researchers

participated. Among the contributions

to scientific knowledge of the area, there

is a registration of more than 2260

terrestrial species (excluding insects),

over 700 aquatic species, finding of

6 new species of insects for science, a

detailed characterization of the different

landscape units, generating information

on the different biological groups

evaluated: vegetation, insects,

amphibians, reptiles, birds, mammals and

aquatic biota, and knowledge about the

structure and function of the ecosystem

monitored.

All the information related to the program

and its activities can be found in the

website www.pmbcamisea.com


ENVIRONMENT

CAMISEA, PERU

BIODIVERSITY MONITORING PROGRAM (BMP)

During 2014, within the BMP framework, the following activities were carried out:

Landscape monitoring: characterization and evaluation of the deforestation

produced during the installation of heliports and temporary base camps opened

during seismic works, and for the installation of all the wells platforms in Blocks

56 and 88.

Species and communities monitoring: based on the monitoring activities

performed during 2014, and using the information disclosed in the last 10 years,

the degree of negative impact and/or recovery in flowlines and wells locations,

after 6 years of initiating revegetation activities, were analyzed. Additionally,

for this analysis we considered the condition of non-intervened areas with the

same type of landscape unit.

Concerning the aquatic biota, in 2014, 28 stations were monitored, and a

comparative analysis was initiated on the data historically collected in order to

evaluate water course trends with similar characteristics, downstream and

upstream of Camisea Project.

Monitoring Native Communities’ use of resources: analysis of the data obtained

in four running years of information compilation, presenting the first trends

identified in the access to the use of resources, as well as season analysis and

changes in the activities evaluated (hunting, fishing and collection).

IDENTIFYING BIOLOGICALLY SENSITIVE AREAS (BSA) WITHIN THE SCOPE OF 2D SEISMIC OF BLOCK 88:

As part of the block’s exploration and development extension program (FEP),

a seismic survey was conducted for which a biological support program was

designed in order to identify sensitive areas that could be impacted by the

seismic design. To this end, a group of 6 biologists worked with the seismic

topography teams during July and August defining BSA, such as collpas, animal

bathing and feeding places, reproduction zones, water bodies, etc. A total 260

significant BAS and 87 non-significant BAS were identified, which required the

displacement of the seismic lines’ location to avoid impact on these areas.

FULL EXPLORATION PLAN (FEP)

The Block 88 Full Exploration Plan, FEP, includes the execution of different

sub-projects in order to evaluate the exploratory potential, find and develop new

hydrocarbon reserves to ensure meeting Peru’s energy needs in the coming

years. Block 88 is characteristic for its high environmental and social sensitivity,

for which different safeguards have been developed and implemented which

facilitate the execution of works respecting and protecting the environment, and

among which the following stand out: the heliborne operation modality with no

opening of land access roads (off-shore in land), the implementation of a Code of

Conduct for Employees and Contractors, the Communication and Consultation

Program, the Community Environmental Monitoring Program, and the

Anthropological Contingency Plan, as the primary ones. Next, we highlight some

of the projects implemented within the FEP framework.

Monitoring big mammals during seismic activities with camera traps.The use of camera traps is a non-invasive method, specific for elusive animal

studies and/or animals with nocturnal or crepuscular habits that often avoid

human presence, being their recording through other methods rather limited.

This technique, which consists of a photographic record, provides evidence

of the presence -and even identity- as well as activity patterns of many species.

In 2014, the BMP implemented the “Big mammals monitoring during seismic

activities with camera traps”, with the aim of evaluating the potential impact

related to the exploration activities of the 2 D Seismic Project of Block 88.

Monitoring covered the period of activities associated to the seismic survey with

the installation of 34 camera traps. A total 341 registries were obtained, which

included 19 mammal species, some of which arecategorized as endangered.

As an important registry it is worth highlighting the presence of two species of

bush dogs (Atelocynus microtis and Speothos venaticus) with (VU/NT) threat

category, extremely rare and difficult to observe.

Recovery, Maintenance, Relocation of Epiphytes fromCentral Kimaro Platform in Block 88It was initiated during the forest clearing performed in the location, through the

identification of epiphytes (orchids and bromeliads) in felled trees. These species

were transferred to a greenhouse especially designed for this purpose. Once

stabilized, the epiphytes were relocated on host trees, thoroughly selected,

having previously set for this purpose election criteria according to the

conservation state, vulnerability, diversity, predominance, phytosanitary state,

and others that enable ensuring the continuity of every identified species. 3035

epiphyte individuals were rescued, relocating 1562 individuals. In November, 2014,

the first relocated epiphytes monitoring was performed to determine their

survival rate, evidencing a low mortality rate (8.65% three months after

relocation). Based on the results obtained via the application of strict technical

criteria, it’s been demonstrated that it is possible to transfer species of vascular

epiphytes to new natural habitats, ensuring the survival of these species without

altering the existing diversity, constituting a conservation alternative to reduce

the environmental impact in a highly sensitive zone.

Monitoring with trap-cams, Biodiversity Monitoring Program(Camisea, Peru).

CAMISEA, PERU

The UN Special Rapporteur on the Rights

of Indigenous Peoples presented in March

2014 a report about the expansion of the

Camisea project in Block 88. In this

document he collects his impressions

after his visit to Peru and to the project in

December 2013. He also recognizes ”the

Company´s effort to minimize the

presence and the adverse impacts of its

activities in a geographic area of high

sensitivity due to its extensive

biodiversity and the presence of

indigenous inhabitants”. At the same time,

he highlights the off-shore in land model

developed by the Company in the Block

88 operations as a “good practice” from

the environmental point of view.

The full report of the Special Rapporteur

on the Rights of Indigenous Peoples can

be found at: http://unsr.jamesanaya.org/

esp/special-reports

58 • Pluspetrol

ENVIRONMENTAL DISSEMINATION AND EDUCATION

Supporting education campaigns and

disseminating Biodiversity conservation

actions.

•

•

•

•

•

•

•

•

•

CAMISEA, PERU

SOCIALIZATION AND DISSEMINATION OF RESULTS OF THE BIOTICAND ABIOTIC MONITORING PROGRAM IN PISCO

We keep promoting the participation of local authorities in the monitoring

program’s field activities; in 2014, staff from the following institutions took part:

Paracas National Reserve (RNP), Guano Isles, Islets and Points System National

Reserve (RNSIIPG), Peru Sea Institute (IMARPE), Pisco Port Harbormaster

(CAPISCO), Río Seco Local Water Authority (ALA-RS), Environmental

Committees from Local Municipalities and Universities. Besides, the Program

results are shared and disseminated to the local authorities.

Additionally, the Program results are disseminated through the following

activities:

Anomalous events report (algal blooms, species morality) to Pisco Port

Harbormaster, Paracas National Reserve, Guano Isles, Islets and Points System

National Reserve.

Result dissemination to 338 Camisea workers and from contractors companies,

during an awareness raising day that includes a visit to Paracas Bay, a

demonstrative plankton monitoring, and a visit to Ballestas Islands (habitat of

sea wolves, penguins and guano birds); to later visit the Interpretation Center of

the Paracas National Reserve (RNP).

Results external dissemination to 465 students and 967 stakeholders from our

area of influence, among which there were RNP, RNSIIPG, Paracas Municipality,

Pisco Municipality, San Andrés Municipality, Universities, and Schools.

Identification of Contamination Sources Study in Paracas Bay, carried out by the

Río Seco Local Water Authority (identified sources not related to our activities).

Huerequeque (Burhinus superciliaris) nesting research in the surroundings of the

PFLGN Landscaping Project, presented in the Ornithology National Congress.

ANNUAL BMP WORKSHOPThe annual workshops on results dissemination are framed within the

communication actions carried out by the BMP, which aim is to spread the

information generated by the Program. Based on a transparent process, it

provides concrete contributions to the scientific community, the Oil and Gas

sector, government bodies, and the civil society in Peru, through significant

information.

In 2014, the event was held on June 3 in Lima, Peru.

The panel of speakers comprised four experts, BMP Scientific Committee leaders,

who presented the main results of the year concerning the contributions of the

Program in terms of Biodiversity Management, Scientific and Communication

results.

Other presentations made in 2014:

Bird Monitoring in Lower Urubamba Basin and Effectiveness of Mackinnon Lists, Counting Points and Mist Nets. IX Ornithology National Congress Ayacucho,

Peru.

Biodiversity Monitoring Program in Camisea. 10 Years of Implementation. VIII INGEPET, Lima.

Landscape Changes Associated to the Camisea Project Development - Its Evolution Along Time. VIII INGEPET, Lima.

Characterization and Ecosystemic Services of the Amazonic Forest Pacal in the Lower Urubamba, Cusco, Peru. XI Latin American Botanical Congress -

Salvador de Bahía, Brazil.

Participation via the setting-up of a PMB stand in the Society of Petroleum

Engineers (SPE) in June, 2014.


ENVIRONMENT

60 • Pluspetrol

The Camisea project is developed in a complex

scenario, from both the environmental and social

point of view. On the one hand, the operations are

carried out in a sensitive natural ecosystem, which is

the Tropical Forest of the Lower Urubamba valley

(Cusco, Peru); this zone is categorized as a

Biodiversity Hotspot26, included in the “Global 200”27;

besides, Block 88 is situated within the buffering

zones of Manu and Otishi National Parks. Likewise,

the project’s area of influence is inhabited by

indigenous population with different levels of

organization, while part of the block is located within

the Kugapakori Nahua Nanti Territorial Reserve28.

Understanding this environment’s complexity, since

the Camisea project design phase environmental and

social management was considered a key aspect

when it came to defining operational alternatives and

techniques in all the activities involved in the

process.

The starting point for all socio-environmental

considerations was the participative design of the

consultation process, which was done in the early

stages of the project, enabling the identification

of the communities’ specific concerns and

interests through the dissemination of clear and

accurate information in over 50 workshops held.

The consultation process generated a series of

commitments with the stakeholders, which are

embodied in the following general considerations:

10 YEARS OF CAMISEA - PERU

COMMITMENTWITH

STAKEHOLDERS

COMMUNITYOUTREACH

PLAN

BEFORE THE PROJECT

SOCIO-ENVIRONMENTAL CONSIDERATIONS

DURINGTHE PROJECT

PARTICIPATIVE DESIGN PMAS

ESIASPECIFIC

PROGRAMS

RESPECTFOR NATIVE

COMMUNITIES

COMPLIANCEWITH IFC

PERFORMANCESTANDARDS

IMPACT REDUCTIONAND PREVENTION

CAMISEA

Malvinas Plant,Camisea, Peru.


ENVIRONMENT

Another milestone in the project was the

development of the Environmental and Social Impact

Assessment (ESIA), which was carried out under the

IFC, the World Bank and Peruvian legislation

guidelines. The social and environmental baselines

were built thoroughly considering participation of

the local communities.

Based on the impacts identified and evaluated in

the ESIA, a series of distinctive management tools,

as well as best practices were defined and applied,

which nowadays constitute a standard in the

development of hydrocarbon activities in rain

forest zones:

TOOLS

BEST PRACTICES

OFF-SHOREIN LAND

PIPELINE SPECIFIC DESIGN

HELITRANSPORTABLE SEISMIC

EROSION AND REVEGETATION

CONTROL

MINIMUM USE OF THE LAND

DRILLING CUTTINGS

RE-INJECTION

INTERVENEDAREAS

RECOVERY

GUIDED DRILLING

26. According to Conservation International (CI)27. According to World Wildlife (WWF).28. The RTKNN was created in 1990 as a State Reserve; inside it, populations with different levels of contact reside, some of them settled and others in voluntary isolation.

BIODIVERSITY MONITORING

PROGRAM

PARTICIPATIVE MONITORING

PROGRAM (PMAC + FLUVIAL

COMMUNITY SURVEILLANCE)

ENVIRONMENTAL MONITORING

PROGRAM

ACCESS CONTROL PROGRAM

COMMUNICATION AND

CONSULTATION PROGRAM

ANTHROPOLOGICAL CONTINGENCY

PROGRAM

CODE OF CONDUCT AND

STAFF TRAINING

AGREEMENT, COMPENSATION AND

INDEMNIFICATION ESTABLISHMENT

PROGRAM

LOCAL EMPLOYMENT

PROGRAM

ARCHEOLOGY AND CULTURAL

RESCUE PROGRAM

62 • Pluspetrol

SOME OF THE PROGRAMS CURRENTLY ONGOING IN CAMISEA:

PARTICIPATIVE MONITORING PROGRAM

By means of this program, Pluspetrol

seeks to increase the efficacy and

efficiency of the monitoring and

supervision actions in the Camisea

operations, through the participation

of local population. In this way,

we can generate and record reliable

and accessible information, via the

community, for its use by the local

population, Pluspetrol and interested

organizations. In turn, this program

has two segments: one is the Lower

Urubamba Community Environmental

Monitoring Program, which is directed

to the community monitoring of

environmental aspects, and the other

one is the community fluvial surveillance

Program aimed at monitoring fluvial

transport in Urubamba and Camisea

rivers.

COMMUNITY ENVIRONMENTALMONITORING PROGRAM (PMAC)

This program has 4 components and its main objective is to promote and

implement the actions necessary to ensure conservation of the environment

by contributing in maintaining biodiversity, and encouraging the use of

sustainable resources for the development of a conservation culture in the

local communities.

All the information gathered during the monitorings is duly recorded and, if

potential deviations to the applicable procedures are identified, relevant

corrective measures are implemented. At the same time trainings, workshops

and talks are coordinated in order to disseminate the program’s results, share

experiences and generate awareness about the environment.

COMMUNITY FLUVIAL SURVEILLANCE

OBJECTIVES1. ONGOING FLUVIAL TRANSIT COMMUNITY MONITORING.

2. COMMUNITY VERIFICATION OF THE PROJECT’S FLUVIAL TRANSIT REGULATORY COMPLIANCE.

RESULTS1. PROMOTION OF LOCAL WORKMANSHIP EMPLOYMENT IN RIVERSIDE COMMUNITIES.

2. 22 SURVEILLANCE BOOTHS ALONG URUBAMBA AND CAMISEA RIVERS.

3. 40 FLUVIAL WATCHMEN FROM 20 COMMUNITIES.

22 COMMUNITY MONITORS WORKING FOR 8 YEARS

OPERATION FOLLOW-UP

POTENTIAL IMPACT EARLY IDENTIFICATION

ONGOING DIALOG CHANNELWITH THE COMMUNITIES

RESULTS OF THE COMMUNITY ENVIRONMENTAL MONITORING PROGRAM 10 YEARS AFTER INITIATING CAMISEA

PMAC

SOCIO-ENVIRONMENTAL MONITORINGContinuous follow-upand observations of both aspects

TRAINING AND COORDINATION COMMITTEEReliable registry and experience sharing

ENVIRONMENTAL EDUCATIONAwareness raising on the environment and initiatives coordination

COMMUNICATION AND DISSEMINATIONSkills developmentand training

01

02

03

04


ENVIRONMENT

ENVIRONMENTALMONITORING PROGRAM

The objective of this program is to

evaluate physical and chemical conditions

of the environmental factors as air,

surface water, groundwater and soil.

To this end, through a system of

monitoring stations located upstream

and downstream of our facilities, a

number of parameters are measured:

Air quality

Emissions

Surface water quality

Groundwater quality

Soil characteristics

This program ensures that none of

these factors is affected as a result of

the activities carried out by the Camisea

project.

BIODIVERSITY MONITORING PROGRAM (BMP)

OBJECTIVE: THE SYSTEMATIC EVALUATION OF BIODIVERSITY

TO DETECT CHANGES OR DISTURBANCES.

The BMP generates contributions to biodiversity management via

recommendations for decision-making. Among the topics addressed are included

the information for the selection of better alternatives from the environmental

viewpoint in the definition of pipeline routings; implementation of procedures

when encountering fauna; identification of highly sensitive areas from the

biodiversity point of view; identification of recovery-delayed sectors; invasive

exotic species mapping; and staff training, among others.

In 10 years of implementation, some scientific conclusions were drawn:

The Camisea Project’s landscape footprint is of about 481 hectares, and it

represents less than 0.2% of the project’s total area (Block 88, Block 56 and

Malvinas Plant area), confirming that the implementation of Pluspetrol’s work

methodology, consisting of a scheme with no roads construction and closing

and reforestation actions, is critical to minimize impact on the ecosystem.

The edge effect associated to flowlines opening was studied. In different

vegetation indicators, an effect was checked up to 25 m from the center of DDV.

For specific indicative groups (such as beetles), we observed a gradual increase

in the richness of the species, from the flowline edge to 50 m.

The limnological parameters evaluated in water courses present normal values

for Amazonian waters, and the variations observed are related to the climate

conditions and the basin’s location.

Biodiversity Monitoring Program(Camisea, Peru).Photograph: Enrique Castro

•

•

•

•

•

•

•

•

64 • Pluspetrol

COMMUNITY

WE PROMOTE A HARMONIC RELATIONSHIP WITH THE COMMUNITIES

OF THE AREAS WHERE WE OPERATE, PURSUING TO FAVOR THEIR

LIFE QUALITY AND DEVELOPMENT, PRESERVING BIODIVERSITY AND

LOCAL CULTURES.

SOCIAL INVESTMENT

PARTICIPATORY PROCESSES

INDIGENOUS COMMUNITIES

LOCALEMPLOYMENT

COMMUNITY COMPANIES

INSTITUTIONAL STRENGTHENING

COMMUNITY DEVELOPMENT

COMMUNITY

Sustainability Report 2014 • 57Sustainability Report 2014 • 65

One of Pluspetrol’s

strengths is its capacity to perform

in sensitive socio-cultural and

geographical environments. To

achieve and sustain such capacity

in time, it is imperative to achieve

an efficient leadership and

management of resources and the

relations with local communities.

In this respect, the implementation

of the best practices in the industry

and the continuous improvement

of our operations add value to

the care and conservation of

the environment and the local

communities, and they contribute

in the strengthening of stakeholders’

development skills.

Marisol Rodríguez VargasCommunity Affairs Corporate Manager

Villa Trompeteros, Loreto.Pluspetrol Norte, Peru.

66 • Pluspetrol

The social management that we perform seeks to

consolidate relations that generate value for the

company and stakeholders. Particularly, we work

with the communities based on social management

standards that gradually enhance our performance.

Such standards set guidelines to detect and timely

prevent our projects’ potential impacts on the local

populations, their lifestyles, culture and/or territories.

In this way, the corporate community action

standard establishes the general guidelines for

establishing relations with local communities, while

enabling each Business Unit to be able to respond to

particular challenges of their socio-cultural context.

In turn, the corporate social investment standard

incorporates the criteria to be considered in defining

and directing social economic investment, as part of

our project and operation sustainability strategy.

Another corporate standard which is part of the set

of documents that guides our social management is

the one referred to land acquisition and involuntary

resettlement, which establishes general guidelines for

the development of an orderly and consensual land

acquisition process for its use during the operational

phase.

MANAGING OUR RELATIONSHIP WITH THE COMMUNITIES

SOCIAL MANAGEMENT GUIDELINES DURING THE PROJECT’S LIFE CYCLE

Stakeholders indentification and early

assessment of the social conditions in the area

At the initial stages of assessment and selection of a

production site, activities focus on identifying and

mapping stakeholders, in addition to performing an

early analysis of the social condition of the area.

Strengthening and development of projects

Definition of projects through participatory

mechanism and strengthening of relations with

stakeholders, fostering mutual approach and

understanding.

Concurrently, compensation mechanisms for

communities are evaluated as regards any potential

impact generated by our presence in the area.

Management of social impacts and

Implementing social investment plans

During the operation stage, projects are continued

with local communities, and social investment plans

are organized.

During the abandonment stage, we weork to

minimize social impact on the areas reverted.

ASSESS AND SELECT

EXECUTE AND OPERATE

DEFINE

ABANDON

•

•

•

Sustainability Report 2014 • 50Sustainability Report 2014 • 67

COMMUNITY

Pluspetrol’s growth depends on all of our

stakeholders’ growth. Hence, our efforts are focused

on contributing to generating economic

opportunities and improving the life quality of the

local communities in the areas surrounding our

operations through different productive initiatives

and entrepreneurships; always preserving identities,

customs, culture and traditional values. By means

of programs led by the different Business Units,

community relations teams develop sustainable plans

and projects, aimed at promoting the local

population’s skills and capabilities, with medium and

long-term economic initiatives, and therefore

contributing to local and regional development.

Education, Healthcare, Institutional and Productive

Strengthening, and Community Development are all

considered priority work lines which we implement

transversally throughout the company.

SOCIAL INVESTMENT

COMMUNITYPROJECTS

EDUCATION

HEALTH

INSTITUTIONAL AND PRODUCTION STRENGTHENING


Camisea,Lower Urubamba, Peru.

68 • Pluspetrol

EDUCATION

HIGHLIGHTEDPROJECTS

ARGENTINA

MUSIC AS A LEARNING AND VALUE-SHARING TOOL

“Among violins and cellos, musical stimulation” is a project that Pluspetrol carries

out together with School No.234 from the City of Plottier, within the framework

of the “School Projects Support Program” that the company has been conducting

during the last 4 years in the South District, supporting initiatives associated with

technology, physical activities, libraries, art, among others.

We work jointly with the headmasters and teachers of this school, located in one

of the access roads to the Centenario Oilfield and close to several company’s

facilities, it is attended by kids from poor neighborhoods in the eastern area of

the city. In 2014, we decided to create a children orchestra with pedagogical

purposes, to promote social inclusion through music, which is appreciated as a

tool that consolidates values such as discipline, solidarity, collective sense and

intellectual development.

For the project, the School arranged the contribution of two workshop leaders,

in charge of children pedagogical and training aspects, while from Pluspetrol

we committed ourselves to provide the required instruments. Since June 2014,

the project has been running with a significant participation of children from the

school and the neighborhood on an extracurricular schedule.


TECHNOLOGY TO TRAIN AND PROVIDE HOPE

Since 2014, Pluspetrol has contributed to a project that the organization Kuepa

runs in the Nuevo Andoas native community (Block 1AB), in order to train

young people who were not able to complete their high school studies through

an online platform.

The 8-month long project is supported by the Department of Education and

is conducted with the consent and participation of the High School’s headmaster,

parents and students.

The Kuepa organization has ample experience in this kind of digital education

experiences, which are being performed in different parts of the world. By means

of a modern platform, it facilitates distance learning or face to face learning, with

excellent digital educational content.

From Pluspetrol we facilitate the program’s integration in the Nuevo Andoas

community. Our IT staff was responsible for the implementation of the

infrastructure to support the project, installing 8 new networked computers in

the Variante Agropecuaria school.

At the program’s launch, 12 youths from the Nuevo Porvenir, Alianza Capahuari

and Nuevo Andoas communities participated, subsequently joined by 7 youths

from Los Jardines native community.

TO STRENGTHEN THE EDUCATIONAL QUALITY OF OUR COMMUNITIES

WHAT DO WE SEEK?

EDUCATION PROGRAMS BASIC INFRASTRUCTURE SCHOLARSHIP PROGRAMS

WHAT DO WE WORK ON?

Up right: Plottier, Neuquén, Argentina.

Down left: Block 1 AB, Pluspetrol Norte, Peru.


COMMUNITY

Argentina

Bolivia

Camisea,Peru

Pluspetrol Norte, Peru

BU

Educational Projects

PROJECT

Scholarship program for university students.

Forest Nursery Project at Cornejo Agricultural School.New Project.

Support to productive indigenous community projects.

Pilot Environmental Education Programfor basic level Educational Institutions in Pisco province.

Technical Training Program for 4th and 5th year high school students as Maintenance Mechanic Assistant

Success Program - Young People Entrepeneuring for Success New Project.

University Scholarships Program –UCSS NOPOKI–.

Local Educational Management Support Program.New Project.

LOCATION 2014 RESULTS

Ramos

Ramos

Tacobo and Tajibo

Pisco, San Andrés and Paracas

Pisco

Pisco

Native communi-ties from Camisea, Kirigueti and Nuevo Mundo, in Lower Urubamba

Nueva Jerusalén(Block 1AB).

Financial help is provided through a fixed monthly amount to cover the university courses of scholars. Like the previous year, during 2014 scholarships were granted to 14 students.

It is a new project aimed at producing native plants for reforestation efforts. During 2014, sprinkler irrigation materials were acquired.

We continued providing financial and material support to educational programs in 17 Guaraní communities from Tacobo and 13 indigenous communities from Tajibo.

Strengthening of values, attitudes and skills of students and teachers from 10 institutions, with an emphasis on neighborhood environmental education and knowledge of nearby protected natural areas. In 2014, a total 5,980 students were trained.

Technical training for employment opportunities in the short-term. In 2014, 100 4th and 5th year students from the Raúl Porras Barrenechea, José de San Martín and Renán Elias Olivera schools were trained.

Training and strengthening young entrepreneurs’ business knowledge. During the first year, 200 young people were trained, and 15 entrepreneurs won the “capital semilla” (seed capital), a stimulus given in order to establish the business idea.

Professionals are developed under an intercultural, bilingual approach. Continuing with the program, in 2014, twenty one young people (7 women and 14 men) from Kirigueti, Nuevo Mundo, Timpía, benefitted from the university study scholarships on Basic Intercultural Bilingual Education, Agricultural and Forestry Engineering, and Administration.

Support for the educational quality of the community students is provided. Services of a pre-university education professor were hired and 12 students were successfully trained.

Down left: Camisea, Lower Urubamba, Peru.

Up right:Gral. Mosconi, Salta, Argentina.

Center right:Camisea, Lower Urubamba, Peru.

Down right: Lower Urubamba, Peru.

70 • Pluspetrol

ARGENTINA

INDIGENOUS COMMUNITY’ HEALTHCARE

Since 2005 Pluspetrol has actively contributed to the AMTENA (Thomas Elkins

Norte Argentino Health Care) program, whose objective is to contribute to health

care in indigenous peoples communities that live in the Santa Victoria Este and

neighboring areas, 170 km east of Tartagal.

During 2014, Pluspetrol and the province of Salta collaborated by ensuring the

logistics for both doctors and patients. In the two campaigns run during the year,

a total of 3655 patients were assisted: 961 clinical visits, 916 pediatric visits,

and 845 gynecological visits; besides, 499 gynecological studies were performed,

as well as 676 imaging tests and 257 dental visits.

By late 2014, a specific campaign of surgical operations was carried out for

the first time, where 19 professionals from the Británico and Italiano Hospitals

participated.

BOLIVIA

COMMUNITY HEALTHCARE SERVICE

Through the Solidary Medical Group (GRUMEDSO), throughout 2014 we

continued providing primary health care to neighbors from the 31 communities

in the area of influence of Tacobo, Tajibo and Curiche fields, with the aim of

performing health diagnosis focused on illness prevention, as well as providing

pharmacological treatment when required.

This year, 155 service days were completed, and 4,978 patients were assisted

(830 more than in 2013). The most frequent pathologies were acute respiratory

infections (29%), musculoskeletal conditions (18%), gastrointestinal conditions

(17%), and cardiovascular illnesses (13%).

HEALTH

HIGHLIGHTEDPROJECTS

TO ENHANCE AND PRESERVEOUR COMMUNITIES’ WELL-BEING.

WHAT DO WE SEEK?

PREVENTION PROGRAMSBETTER ASSISTANCEHEALTHCARE SERVICES

WHAT DO WE WORK ON?

COMMUNITY

Argentina

Camisea,Peru


BU

Healthcare Projects

PROJECT

“Pluspetrol and Schools”Healthcare plan.

“Healthy to school” Healthcare Plan.

“Zero Cavity” ProgramNew Project.

Healthcare Program - Medical Campaigns.

Prevention and Health Care. “Health Promoters Training”.

Provision of Community First-Aid Kits


Neuquén Area

Ramos

Pisco, San Andrés and Paracas

Block 1AB

Block 1AB

Block 8

Dental, pediatric and ophthalmologic assistance to school-age children. In 2014, 1,406 dental visits were made (with 5187 services) as well as 1,385 pediatric visits. Additionally, in the ophthalmology area, 551 visits were performed and 232 pairs of glasses were delivered.

In 2014, we worked all year round at Coronel E. Vidt School in General Mosconi, to detect and solve basic dental (with 7,684 services), pediatric (with 1,408 services), ophthalmological issues (860 pair of glasses were delivered), and to refer high risk cases to Public Health Centers (457 derivations).

Dental health assistance aimed at reducing the risks associated with dental cavities, in the framework of the Interinstitutional Support Agreement entered into with San Juan de Dios Hospital from Pisco. In 2014, over 1,300 boys and girls of between 3 and 11 years of age, from three educational institutions (kindergarten and elementary school) benefitted from it.

Access to health is favored for indigenous communities (assistance, medical tests and medicines). During 2014, 17,706 medical consultations were delivered at health stations in Block 1AB, besides the medical campaignsin Pastaza and Tigre basins communities.

Health promoters training within the communities. During 2014, we continued training 27 young people through courses deliverd by qualified professional in Andoas and San Jacinto medical units.

In 2014, we provided the Native Communities from Patuyacu and Chambira basins with community first-aid kits containing basic medicines. The material was delivered to local health promoters.


72 • Pluspetrol

INSTITUTIONAL STRENGTHENING

HIGHLIGHTEDPROJECTS

BOLIVIA

SUPPORT TO COMPREHENSIVE PROJECT MANAGEMENT

Pluspetrol continues working jointly with FUNDESOC to support the

comprehensive and social management of development projects for 30

indigenous communities of the Guaraní People Assembly Captaincy (APG),

North Charagua.

During the reporting period, 13 water projects were managed for those

communities; we helped arrange the funding for the execution of the Social

Housing Construction program for 5 communities.

CAMISEA, PERU

TECHNICAL GUIDANCE TO COMMUNITY COMPANIES

During 2014, Pluspetrol continued supporting and providing technical guidance

to transport community companies that belong to the CISA Consortium, in the

Ucayali Region, through the Business Strengthening Program in Atayala.

With the aim of improving the management capacity of community companies

and settlers who provide fluvial cargo transport, during this period we worked on

diversification tasks, and we managed to help them become providers of other

companies, both private and state-owned. Also, we provided guidance related to

the constitution and formalization of CISA SAC.

TO FOSTER SELF-MANAGEMENTOF SOCIAL ORGANIZATIONS

WHAT DO WE SEEK?

SELF-MANAGEMENTSKILLSCAPABILITIES

WHAT DO WE WORK ON?

Up right:Bolivia.


COMMUNITY

Argentina

Bolivia

Camisea,Peru


BU

Institutional Strengthening Projects

PROJECT

Family Foundation.

Headquarters construction for APG Captaincy in Charagua Norte.New Project.

“Carlos Laborde de Sepahua Institute Capabilities Strengthening” Program. New Project.

Framework Commitment subscribed this year with the provincial municipality of Pisco and local governments.New Project.

Institutional Strengthening Program in Indigenous Federations.

Gastronomic and hotel management training center in Villa Trompeteros.

Skills strengthening.New Project.

Basic Welding Course.New Project.


Neuquén Area

APG Captaincy, North Charagua.

Atalaya

Pisco

Communi-ties from Pastaza, Corrientes and Tigre basins(Block 1AB and Block 8)

Block 8

Block 1AB

Block 1AB

Support to productive projects and community support to project entrepreneurs: native thinking, green horizon, microenterprises bank and pig production.

With resources from the TCB-X1002ST well compensation, the construction of the Captaincy’s new headquarters in Charagua was financed.

Project management, development of skills on cacao growing, and infrastructure and equipment enhancement. In 2014, technicians and producers specialized in cacao growing were trained.

A money contribution was established for the execution of social, economic and infrastructure projects in a 5-year period: cleaning service and green areas enhancement to mitigate environmental impact in Pisco; and installation of sewage, house connections and wastewater treatment facilities in San Emilio, San Jacinto and Zarate Emilio neighborhoods.

Strengthening of environmental and public management capabilities of the organizations. Agreements were reached with the Corrientes River Federations (FECONACO and FECONAT) in order to finance informative workshops.

The Center has a training plan in place for young people from the region to develop restaurant and hotel hospitality skills. In 2014, thirty-seven students graduated.

Young people from the communities are trained to meet the needs of contractor companies that work inh Block 1AB. They were trained in welding, brick laying and vehicle driving services. In 2014, 19 people from the communities were trained in the welding course, 18 in the brick laying course and 20 in the vehicle driving course.

In 2014, training was delivered by the National Service of Industrial-Technical Training (SENATI) in the Andoas base, with a duration of 100 hours. Certificates with national recognition were delivered. 19 inhabitants from the communities took part in it.

Down left:Centenario, Neuquen Area, Argentina.

Up right:Centenario, Neuquen Area, Argentina.

Down right:Pisco, Peru.

TO ENCOURAGE PRODUCTIVE INDEPENDENCE AND INFRASTRUCTURE STRENGTHENING

WHAT DO WE SEEK?

SUSTAINABLE PRODUCTION ENTERPRISESENHANCEMENT OF INFRASTRUCTURE AND UTILITY SERVICES

WHAT DO WE WORK ON?

74 • Pluspetrol


HIGHLIGHTEDPROJECTS

ARGENTINA

A COMMUNITY AND ENVIRONMENTAL ALTERNATIVE

“Native Thinking” is a project started four years ago in North Valentina

(Neuquén Area), based on the interaction of a local NGO (Fundación Familia),

the Environment and Health School of the Comahue National University and

Pluspetrol.

The project has a community and environmental objective. A group of young

women received training from the University to implement a nursery and

greenhouse and produce local flora seedlings to be used to revegetate degraded

areas. The sale of these seedlings generates the support for the youths who

benefit from it.

For this initiative, Pluspetrol contributed a 4 hectare site, and built the nursery,

the hardening site and the irrigation systems. The Environment and Health School

is in charge of the project’s technical management and the attendees’ training.

Additionally, Fundación Familia accompanies the whole process considering the

social risk environment the participants come from.

During 2014, we worked on seeds collection and planting, and raising of native

species for further sale. Approximately 20,000 seedlings of 8 different species

were produced and sold.

BOLIVIA

AGREEMENTS AND PRODUCTIVE PROJECTSFOR WATER AND ECOSYSTEMS CONSERVATION

The aim of this Interinstitutional Agreement between Fundación Natura, North

Charagua APG Captaincy and Pluspetrol is to preserve the captaincy’s water

resources and its 30 communities, in order to ensure long-term water supply for

human consumption, food security, the environment and the development of

economic activities.

As part of this project, the implementation of Water Reciprocal

Agreements (WRA) is considered, where water users

downstream in the basin support upstream communities or

farmers through development projects in order to

preserve or restore ecosystems relevant for the provision

of domestic use and irrigation water. For its

implementation the participating municipalities, the

entity that renders the water service, irrigators, NGOs

and Pluspetrol provide about 80% of the economic

resources that will be invested upstream. The resources

collected are managed by local institutions and the value of the

retribution is decided during participatory processes.

During 2014, the socio-economic diagnosis of 30 captaincy communities

was performed. Likewise, a water potentiality inventory and a water

systems diagnosis are being carried out.

COMMUNITY

Argentina

Bolivia

Camisea,Peru

Community Development Projects

“This is Rhythm” Project.

Support to the North Valentina Neighborhood Center.

North Valentina Genetic Lodge.

Cobblestone Project.New Project.

Construcción de sede socialpara Community de San Silvestre.Proyecto nuevo.

Mejoramiento del Matadero MunicipalAbapó Sur.Proyecto nuevo.

Construcción de un parque infantil.Proyecto nuevo.

Support for procurement and purchase of traditional fishing equipment within the framework of the emergency program for Traditional Fishermen, through Fondepes.

“Water and Sanitation - Elevated Reservoir Construction in Santa Cruz sector, Paracas district” Project.

“Our Well-Being” Project.

Improvement of streets, rehabilitation of the water network and building of sidewalks and pavements.New Project.

Neuquén Area

Neuquén Area

Neuquén Area

Ramos

Curiche

Curiche

Curiche

San Andrés, Paracas and Pisco localities, Ica Depart-ment

Paracas localities, Province of Pisco, Ica Depart-ment.

Amazo-nian indigenous communi-ties from Lower Urubamba (Camisea, Shivan-koreni, Cashiriari, Segakiato, Kirigueti and Nuevo Mundo).

San Andrés localities, Province of Pisco, Ica Depart-ment.

An arts engagement forum for children and school age kids, through dance classes. In 2014, 270 students from 8 schools and a community center in the cities of Neuquén and Centenario took part in it. Three public performances were made with an overall number of 3,000 spectators.

We support the development of activities to improve the neighborhood’s life quality. In 2014, there was a contribution of 2,500 meters of drinking water pipelines, streets conditioning, support to popular festivities, power line cables and poles.

Development of a genetically-controlled pork breeding lodge to contribute to poor local producers. Construction of a barn was initiated, which will serve as a breeding center. At present, there are 30 animals under control and breeding.

Cobblestone production for articulated pavement, together with Mosconi Municipality and Unemployed Workers Union (UTD) from Cornejo locality. By mid 2014, Pluspetrol gave UTD, under loan for use, a cobblestone maker, as well as aggregates and cement to manufacture 3,000 cobblestones. At the end of the year, the entrepreneurship is under operation, making its first sales.

Phase 1 of the community center construction was completed for the San Silvestre community to have a place where to hold meetings and cultural activities.

The municipal slaughterhouse has been enhanced and is already operative, which will enable the community to have a space to slaughter animals in optimal health conditions.

Construction of the playground was concluded and it was officially handed over to Abapó community, for the children to have a healthy recreational environment.

Loans. In 2014, 1,125 fishermen were granted a loan.

Paracas inhabitants’ life quality is improvedby means of the provision of drinking water to their homes. The elevated reservoir construction was completed, which will benefit 7,400 inhabitants from the Paracas district.

The development of individual, collective and institutional capabilities to improve relations among family members. During 2014, together with Flora Tristán Organization, the actions focused on two components: Matsiguenga women development program and “My Healthy Home” program. 90 craftswomen from 6 communities, 40 children, 80 local workers, 6 directive boards, and about a hundred inhabitants were benefitted.

Improvement of the living conditions of 4,000 district inhabitants. During 2014, 42% of the work was completed.


PROJECTBU LOCATION 2014 RESULTS

76 • Pluspetrol


Community Development Projects

Construction of community and family fish farms.

Obras de infraestructura para Communityes nativas.

Basic, educational and community interest infrastructure development projects.New Project.

Delivery of agreed-upon goodsand works to native communities.New Project.

Community self-support. 15 fish farms were built. Families received guidance on fish farm management in the beneficiary communities.

Pedestrian walkways in San Juan Nativo, Nuevo San Martín, Santa Elena and Nuevo Porvenir; pedestrian bridge in the Cuchara community; expansion of the school premises in Dos de Mayo community; construction of a community facility for Santa Rosa’s native community. Also, we are building the kindergarten education center in Santa Elena; and progress was made in the construction of two community facilities in S.J. Campesino and Las Palmeras.

During 2014, progress was made in the following projects: maintenance of 3.5 km of the Capahuari road – Tambo (70% progress); electrification system complementary work (37% progress); repairs to the current electrification system (95% progress); improving the electric system in the community changing poles and installing solar panels (25% progress); construction of the kindergarten educational center facility (75% progress).

Two portable sawmills were delivered (and installed) to Sauki and Vista Alegre native communities, and teaching material was delivered to the Titiyacu community. Besides, two community works were concluded: a church for the Titiyacu community and a health cabin for Los Jardines community.

Pijuayal, Valencia, San José de Nueva Esperanza, Peruanito and Boca de Copal (Block 8).

Block 8

Alianza Capahuari, Tituyacu, José Olaya, Doce de Octubre, Vista Alegre, Andoas Viejo, Pañayacu, Los Jardines, Alianza Topal, Sauki, Antioquia, Pampa Hermosa, Alianza Topal(Block 1AB).

Block 1AB

PROJECTBU LOCATION 2014 RESULTS

COMMUNITY DEVELOPMENT PROJECTS

HIGHLIGHTEDPROJECTS

Camisea Native Community, Lower Urubamba, Peru.


COMMUNITY

OUR SOCIAL INVESTMENTIN NUMBERS

During 2014, Pluspetrol assigned US$ 16,242,937

to projects selected based on corporate standards

for community action and social investment,

with the permanent and active engagement of the

communities and beneficiary localities.

PERU

WORKS FOR TAXESA successful and innovative way of complementary

social investment, shared between our company and

the local and regional governments of Peru, is the

“Works for Taxes” modality. The strategy consists

in the investment in community interest works in

the sanitation, health, education and transport

sectors, with private company funds, which may be

exchanged for taxes. The first works in the rain

forest regionwere executed by Pluspetrol Norte in

the Nuevo Andoas community; it consists in the

construction of a new high school.

20,000,000

15,000,000

10,000,000

5,000,000

0

2011 2012

13.6

2013

15.5

SOCIAL INVESTMENT, IN MILLION US$2011/2014 EVOLUTION

Education

Health

Community development

Institutional strengthening

Other

TOTAL

•

•

•

•

•

935,221

4,047,757

5,561,651

399,589

2,681,183

13,625,400

748,425

3,282,958

8,048,339

468,138

3,037,454

15,585,312

911,842

2,792,347

10,188,868

2,639,462

2,118,272

18,650,791

18.6

2014

16.2

739,479

2,344,859

8,533,732

1,132,538

3,492,330

16,242,937

Field(in dollars)

Villa Trompeteros,Loreto, Peru.

COMMUNICATION PROCESSES

Pluspetrol’s community action is based on reliable, accessible,

understandable and timely information related to its operations and

projects. During 2014, Pluspetrol promoted the liaison with local

communities through meetings, workshops, visits or hearings, associated

with the communication of their projects and fulfillment of the

commitments made in the different legal instruments.

78 • Pluspetrol

The starting point of our participatory

processes is to understand the

communication needs and interests of

our local communities. The citizens and

community engagement is inherent to our

social management process; community

involvement demands an open and

intercultural approach from us, which in

many occasions increases the timeframe

of a project so as to adapt it to the

local decision-making processes. This

change in the perspective ensures a

rational and committed support of the

population to our projects. Engagement

mechanisms are made viable by means

of different strategies, such as

consultation and information workshops,

participatory monitoring programs,

local staff incorporation in new projects’

monitoring, and community lookouts

training, among other alternatives. The

development of participatory methods

enhances the projects’ quality, efficiency

and sustainability; and strengthens

our stakeholders’ responsability and

commitment.

PARTICIPATORY PROCESSES In our industry there are two types of

citizen participatory mechanisms: the

mandatory ones, that is, those contained

in the standards and regulations of each

country’s extraction sector, and the

processes designed by the company itself

to encourage the engagement and

involvement of local players and integrate

them into the decision making process.

The mandatory or legal engagement

mechanisms demand that companies

follow a communication, consultation

and/or information process of their

projects to the people who inhabit the

areas surrounding their operations. In

certain countries, such as Colombia or

Peru, this action is carried out in a phase

previous to the operations and land

concession; others admit it in a phase

subsequent to the bidding contract´s

subscription, through the execution of

informative workshops, hearings or

other citizen-engagement events, where

the population’s expectations, doubts,

concerns and suggestions in relation

to the new project are collected

and incorporated into the final design.

PPN, PERU

The company held several meetings in Block 8, in order to sign agreements and contracts with communities from the Corrientes, Patuyacu and Chambira river basins.Additionally, 30 meetings were held, where agreements were subscribed, which are part of the vandalism prevention plan, such as: the Fluvial Surveillance Program and the Mutual Benefit Agreement for facility (pipelines) security, with the participation of Patayacu and Chambira communities for the 2014-2015 period.Meetings and assemblies were held in Block 1AB, in different communities, to negotiate the use of lands and quarries.Finally, 12 meetings were held Pastaza and Corrientes basins communities to evaluate the progress made in relation with the 2011-2014 Agreement.

●

●

●

●

BOLIVIA

During 2014, together with the Curiche community, we addressed the Tacobo Field’s 3D Seismic Exploratory project. 6 agreement subscription assemblies with a total 540 people were held, as well as 17 community meetings to inform 363 people about the project execution.2 Meetings with the Tajibo community were held for the reception of claims and complaints, attended by a total of 30 inhabitants.

●

●

ARGENTINA

13 meetings with a total 69 people were held in Centenario Field to move forward with respect to the company’s operations and collaboration with the community.In Zapala, we reached an agreement with the Gelay Ko community to complete an exploratory well after 5 meetings with a total of 8 people.

●

●

ANGOLA

4 briefings were held, where consultations were received from 168 inhabitants from Yabi, Chimbolo, Simindele & Chibodo, and Zongolo communities in order to provide a better understanding of the company’s activities and search for community engagement alternatives.

●

50 Workshops were held to inform the communities about the company’s activities, attended by 1543 people, besides the issuance of 5 newsletters that reached 50,000 people in Pisco, San Andrés and Paracas.To receive enquiries or requests for support and coordinate activities, 61 events were held with the Boards from the 12 communities from the direct and indirect areas of influence of Blocks 88 and 56, Lower Urubamba.39 meetings were held with local inhabitants, base organizations, educational and public institutions from Pisco, San Andrés and Paracas, attended by a total 917 local inhabitants.

●

●

●

CAMISEA, PERU


COMMUNITY

GRIEVANCE RESPONSEMECHANISMS ANDCONFLICTS RESOLUTION

The development of our activity involves

permanent interaction with local

stakeholders. This liaison is particularly

complex in those regions where multiple

players with different interests coexist,

or in social environments where diverse

indigenous communities reside, each of

them with their own values and cultures.

From Pluspetrol we work to solve

differences within a mutual respect

framework. In all our operations we have

procedures to ensure the appropriate

reception and answer within the shortest

possible time to eventual complaints

received from the local population, public

or private institutions, and indigenous

organizations settled in the area of

influence, among others.

CORE ELEMENTS OF THECLAIM OR COMPLAINT RESOLUTION PROCESSES

We worked on the resolution of 2 conflicts in Ramos and Centenario Fields, related to the demand for service provision and cooperation in general tasks that the company provides the communities in the area. Company representatives met with community leaders and neighbors.

In Block 8, four conflicts were recorded related to the retention of workers who provide services to the company and also from fluvial vessels, in the Nueva Valencia, Nueva Unión, Boca de Copal and San José de Nueva Esperanza communities. There were 9 labor stoppages in the communities of Nueva Reforma, La Petrolera, Nuevo Progreso, Nueva Alianza, Santa Teresa, Nuevo Peru and Bellavista. The facilities of a contractor company were taken over in the Nuevo Porvenir community. In Block 1AB, two labor stoppages were recorded in the José Olaya community, and 1 access blockade in Nuevo Andoas, due to compensation claims for the use of lands and quarries. Additionally, an alliance of communities performed a pacific demonstration for 15 days -which affected the normal traffic and activity in the area- to draw attention to different claims; on the other hand, the Doce de Octubre community carried out one blockade in the entrance of Tigre river bridge, due to the delays in the commencement of the works agreed upon, an elementary school. Also, 2 blockades of the main road were recorded: the Nueva Jerusalén community protested against a chemical leakage incident, and representatives from Tigre Basin demanded that the Government hire an expert company to carry out soil characterization works.

ARGENTINA

PLUSPETROL NORTE,PERU

•

•

•

OBSERVANCE OF RESPONSE TIMES ENSURING CLAIMANTS’ SATISFACTION.

INVESTIGATION OF THE EVENT OCCURRED AND RELEVANCE OF THE COMPLAINT TO DEFINE CORRECTIVE ACTIONS.

DESIGNATION OF PEOPLE IN CHARGE FOR ALL MANAGEMENT PHASES.

IMPLEMENTATION OF RECORDING AND MONITORING TOOLS FOR ALL THE PHASES OF THE PROCESS.

EVERYOPERATION

HAS ITS OWN PROCEDURE,

ADJUSTED TO ITS CHARACTERISTICS

AND CONTEXT

The conflicts were solved through meetings and rounds of dialogue between Pluspetrol, the communities’ authorities and government bodies, if they are involved.

Angola, Bolivia and Camisea, Peru only received a few complaints which were quickly resolved.

80 • Pluspetrol


Pluspetrol’s operations are usually developed in

very sensitive geographical and socio-cultural areas,

such as indigenous communities’ lands. Preserving

their habitat and culture is one of the company’s

priorities, whose strategy is based on respect for

local organizations, traditional values and ongoing

participatory work, to contribute to the development

of these valuable communities.

ETHNIC GROUPS AND CULTURES: THE MACHIGUENGAS29

The Machiguenga ethnic group –also known as

Matsigenka or Machigüenga– inhabits the Peruvian

Amazon rain forest in the basins of the lower

Urubamba, Manu and high Madre de Dios rivers, in

the Departments of Cusco and Madre de Dios,

respectively. According to census data, by 2007, the

population of the communities self-identified as

Matsigenka was 11,279 people. In addition, there are

Matsigenka families in isolation and initial contact

conditions (PIACI), who move around the area of

the Kugapakori, Nahua, Nanti Land Reserve (Cusco

and Ucuyali).

Currently, most of the Matsigenka population lives

in native communities alongside the rivers, which

implies a relative level of sedentary lifestyle.

Regarding their economic activities, the Matsigenka

in general practice small scale mixed farming through

the slash and burn method. Main products grown

include corn, yucca, banana, beans and peanuts. The

crops marketed are annatto, coffee and cacao.

Fishing is the economic activity that represents their

primary source of animal protein in their basic diet,

while hunting comes second.

Until the beginning of the 1950’s, the Matsigenka’s

political organization was limited to a self-selected

chief in every family group. Nowadays, also central

organizations, federations and councils are identified,

who represent the different native communities of

the area.

The Camisea Project (Blocks 88 and 56) are

located in community territories of this indigenous

ethnic group; the native communities in the area of

influence of our operations are: Camisea, Ticumpinía,

Cashiriari, Segakiato, Shivankoreni and Kirigueti.

The social management developed since the early

stages of the project with these communities is

detailed in the section “10 years of Camisea” in the

Environmental Chapter.

29. Sources: “Los Machigüengas”, France-Marie Renard-Casevitz, Boletín de la Sociedad geográfica de Lima (1974, 93, août-décembre), p. 27-35.Peru Ecológico: http://www.peruecologico.com.pe/etnias_machiguenga.htmInterculture Vice Ministery of Peru:http://bdpi.cultura.gob.pe/pueblo/matsigenka

PPNEthnic groups:

Achuar Quechua and Urarina

(Department of Loreto, Peru)

CAMISEAEthnic groups:

Machiguenga, Yine and Ashaninca. (Department of

Cusco, Peru)

BOLIVIAGuaraní Ethnic Group (APG

Captaincy, North Charagua)

ARGENTINAEthnic group:

Wichi and Guaraní (North Area)Ethnic group:

Mapuche (Neuquén Area)


COMMUNITY

OBSERVANCE AND PROTECTION OF INDIGENOUS PEOPLES’ RIGHTS

Continuous training programs for Pluspetrol staff

and staff from contractor companies transfer

the main guidelines of community management

regarding liaison with indigenous communities, as

well as knowledge and respect for their cultural

and land rights.

CODE OF CONDUCT

Its objective is the proper work behavior inside as

well as outside our areas in operation, to safeguard

the integrity and good relations with indigenous

communities and the environment. The Camisea´s

Code of Conduct, developed in a participatory way

with indigenous communities in 2002, is the

first antecedent of a document of this kind in our

company.

In Camisea, Peru, during 2014, induction talks on

Community Affairs and the Code of Conduct were

delivered to 2,877 new workers from Pluspetrol and

the different contractor companies.

In turn, in Bolivia 34 talks were delivered on the Code

of Conduct,training 879 workers. Further, within

the framework of the 3D Seismic Exploration project,

25 induction talks on North Charagua Original

Community Land (TCO) were held, attended by 635

workers.

CODE OF CONDUCT

LANDRIGHTS

AGREEMENTS, COMPENSATIONS AND INDEMNITIES PROGRAM

COMMUNITY ENVIRONMENTAL MONITORING PROGRAM (PMAC)


82 • Pluspetrol

CAMISEA, PERU

ANTHROPOLOGICAL CONTINGENCY PLAN (PCA) - BLOCK 88

In order to reduce the level of socio-cultural and health risk in the populations

of the Kugapakori Nahua Nanti Land Reserve (RTKNN) due to the execution

of the Camisea project activities, we continued in Block 88 the Anthropological

Contingency Plan (PCA) that Pluspetrol has implemented since the beginning

of its activities in 2002.

Aligned with the RTKNN Protection Plan -approved by the Ministry of Culture as

part of the official policy for defending the integrity of the people that live inside

said reserve- the PCA considers measures that facilitate efficiently managing,

under social responsibility criteria, situations resulting from the Project’s activities

that involve some level of risk for the RTKNN population.

Among the PCA’s objectives stand out training and dissemination of conduct

standards for Pluspetrol’s and contractors’ staff, associated to procedures and

protocols in the face of sightings and encounters with isolated populations. Also,

in the different work fronts there are lookouts, Matsiguengas as well as Nahuas,

who serve as translators (bilingual Matsiguengas and bilingual Nahuas) in cases

where there is an undesired encounter with the inhabitants from inside the

RTKNN.

Finally, the PCA includes communication and coordination mechanisms with

the relevant authorities to manage possible contingent situations, based on

cooperation agreements with the Ministry of Culture, the SENANP (National

Service for State Protected Natural Areas), and the MINSA (Ministry of Health),

among others.

For the development of the Full Exploration Plan (FEP), the PCA has been

implemented in field operations, pursuant the recommendations and guidelines

set by the VMI (Interculture Vice Ministry), and the UN Special Rapporteur on

the rights of indigenous peoples, incorporating the improvements suggested.

The PCA is an appropriate tool for the prevention and management of undesired

contacts with Isolated or Initial Contact Indigenous Peoples (PIACI).

Each work group has a community lookout especially trained in the PCA, who can

communicate in the native languages of the area (Nanti, Nahua and

Machiguenga).

In 2014, during the execution of the 2D seismic project, under the FEP, 27 pacific

contacts occurred, one sighting and some evidence findings. Most events were

associated to the population settled in the RTKNN (officially called “population in

initial contact condition”), though there were also some events with neighboring

populations, from the Cashiriari and Segakiato communities.

No event with isolated communities has been recorded.

LANDRIGHTS

Pluspetrol develops its activities paying

special attention to respect the isolation

that certain indigenous communities

wish to preserve, without disturbing their

community rights or natural habitat.

CAMISEA, PERU

As part of the PMAC, in 2014 a total of 36 environmental monitorings were

performed in different locations within the areas of operation, both in Block 88

and Block 56.

The monitorings included: Mipaya flowline facilities; drilling platform for the

injection well in Malvinas; Malvinas Gas Plant; Pagoreni B, San Martin 1 and Mipaya

platforms; and facilities in Oropel, paying special attention to wastes management,

drinking and discharge water treatment systems, among others. In addition,

monitoring of dringking water sources, environmental noise and air quality were

carried out in the native communities of Segakiato, Cashiriari and Ticumpinía.

During the year, a total of 12 monthly workshops were organized to provide

environmental and social training.

For more information visit www.pmac-bu.org.pe

BOLIVIA

During the execution of the 3D Seismic Exploration project (initiated 1 August,

2014) a public disclosure document for the consultation and engagement process

was prepared in a participatory manner, and an active assistance in the public

consultation workshops was recorded. Likewise, socio-environmental monitoring

of the following activities associated to the project execution was performed: path

clearing and topographic surveying; verification of minimum safe distances of

shot holes in seismic lines; hiring labor and local services; project socialization in

the communities; communication management with their parent organization and

community authorities; grievances management; community roads use and

maintenance; obtaining permits, valuation and payment of compensations and

signing of conformity acts; staff behavior inductions and surveillance; and

elaborating monthly monitoring reports and a final report.

COMMUNITY


We communicate environmental awareness, with the aim of promoting healthy environmental behaviors inside the communities.

COMMUNICATION AND DISSEMINATION

ENVIRONMENTAL EDUCATION

ENVIRONMENTAL AND SOCIAL MONITORING

MONITORTRAINING

We strengthenthe monitors’ oral and written skills

in order to improve their performance

within the communities.

We register social and environmental variables to evaluate the program by means of monitoring activities.

We design and update a training

plan to strengthen the monitors’

technical skills.

COMMUNITY ENVIRONMENTAL MONITORING PROGRAM (PMAC)

The PMAC is the result of an extensive

participatory process developed

between Pluspetrol and the indigenous

communities that live in the area of

influence of the project. The aim is to take

advantage of these communities’

knowledge to monitor environmental and

social impacts that our activities might

cause. Additionally, the PMAC enables the

local population to participate in verifying

the observance of the environmental

commitments taken on by the company.

The program is structured based on

an improvement process that facilitates

optimizing the scope of its objectives

with active engagement of the

communities:

84 • Pluspetrol

AGREEMENTS, COMPENSATIONS AND INDEMNITIES PROGRAM

Included in our Community Liaison Plan,

agreements, compensations and

indemnities establish fair reimbursement

for the population, under a mechanism

of returns for a service provision or the

temporary use of an area of interest

for our operations. The agreements and

compensations are executed under the

applicable regulations and established

under a process of mutual agreement

with the populations, pursuant to their

decision-taking guidelines or mechanisms.

In the case of indemnities, the purpose

of the negotiation is to revert or redress

a damage or loss caused individually or

collectively; a very simple example of this

process is the indemnity payment for the

plants and/or trees that must be

temporarily withdrawn due to a road

construction in a seismic project.

CAMISEA, PERU

During 2014, six fluvial traffic agreements for the period 2011-2014 were

completely settled, and another three have an outstanding paymentbalance.

Likewise, fluvial traffic agreements for the period 2014-2016 were signed with five

villages and two rural settlements (Shintorini and Tupac Amaru).

Regarding the compensation agreements in the operation phase of Blocks 88

and 56, an agreement with the Kirigueti community was signed as well as an

agreement with the rural settlement Tupac Amaru. Further, we completed

the negotiation with the Ticumpinia community for the Malvinas plant extension.

Likewise, an agreement was signed in relation with the compensation of Block 88

for the 2D seismic survey, and a disbursement was made to the Cashiriari

community.

BOLIVIA

30 productive initiatives were funded, with charges to the following sources:

a) Social Action Plan 2014 (agreements); and b) Compensations Agreement for

Wells SID-X1, TCB-X1002ST, SIN-X1, and Tacobo and Curiche Fields 3D Seismic

(compensations).

Also, we achieved co-financing of the Housing State Agency of Bolivia for the

construction of 66 dwellings in the communities of Puerto Viejo, Tacobo

and El Carmen. The local counterpart comes from resources of the 2014 Social

Action Plan, Compensations Agreement (PBC) and local manpower. As per

the installation and enhancement of water systems for human consumption in

17 Guaraní communities, seven projects were completed with FUNDESOC’s

technical assistance, the resources came from agreements, compensations and

third-party funds, and six projects were executed with the NGO Acción Contra

el Hambre, as a result of FUNDESOC’s management.


COMMUNITY

In Pluspetrol we are convinced

that generating job and local

development opportunities contributes

to the communities’ sustainability

and stregthens our value chain. That is

why we prioritize hiring people from

the areas where we operate, developing

local management capabilities and

encouraging the creation of community

companies that may become

our suppliers and suppliers of other

companies in the area.

LOCAL EMPLOYMENT

In Pluspetrol we particularly prioritize hiring people

living in the communities immediately surrounding

our operations. Our Community Affairs Area

works on mechanisms and agreements that facilitate

hiring local staff -including members of native

communities- directly and through community

companies.

COMMUNITY AND VALUE CHAIN

An agreement was signed with a local organization with the aim of hiring labor for general tasks to be performed in the Ramos Field.

Job opportunities were created for members of native communities and rural settlements from Lower Urubamba associated with different projects executed throughout the year.

To carry out a 3D seismic project in Tacobo and Curiche fields, 93 technically-skilled workers were hired. Additionally, 604 workers were hired to move equipment and staff, and perform drilling, registry, restoration and abandonment, and topographic surveying tasks. Additionally, jobs were provided to workers to manage lodging and food services for 180 workers in hotels and homes. Likewise, community members from Tajibo Field carried out the surveillance of AMR-X1001 well in order to provide water to Aymiri and Quebracho Guaraní communities.

Through community companies serving as our contractors, during 2014, 1,426 job opportunities were generated in Block 8, and 3,803 in Block 1AB. Likewise, 70% of the works executed in the communities were in charge of community companies. Finally, during the reporting period, 89 people were trained in the Villa Trompeteros training school, out of which 19 were employed by contractor companies, and the rest work in their own family businesses.

●

●

●

●

Job opportunities created inPPN, PERU

5,229

Job opportunities created in BOLIVIA

736

Job opportunities created in

CAMISEA, PERU

3,950

Job opportunities created in

ARGENTINA

49

SUPPLIERS

COMMUNITY COMPANIES

LOCAL EMPLOYMENT

LOCAL DEVELOPMENT

VALUE CHAIN CYCLE

86 • Pluspetrol

COMMUNITY COMPANIES AND PRODUCTIVE ENTERPRISES

Pluspetrol collaborates with the creation

and maintenance of community

business initiatives. The Company hires

and advises the services of these local

enterprises and, in turn, the latter

contribute as service suppliers of other

companies in the region.

CAMISEA, PERU

In 2014, the company Segakiato SAC, constituted with compensation funds

granted by Pluspetrol to the native community with the same name, continued

providing fluvial cargo and passenger transport services to Pluspetrol and other

companies, as it’s been doing since 2012.

With respect to the previous period, Segakiato notably increased 80% its staff,

with 382 people in December, 2014, coming from different communities from

Lower Urubamba.


The first entrepreneurship of this kind started its activities in October, 2007,

as an agricultural service community company (ECOMUSA), in the José Olaya

community, with a total of 21 full-time employees. The company started offering

clearing (weed cutting) services in rights of way, oil pipelines, flowelines, high

voltage power lines and specific locations. In July, 2009, a new service was

added: tree felling, which enabled the creation of 16 new work positions.

The company has been growing ever since; nowadays it has 797 work positions.

During the 2014 period, the number of community companies in Block 1AB was

extended, addingup to 10 at present: Doce de Octubre, José Olaya, Antioquia,

Nuevo Andoas, Alianza Capahuari, Nueva Jerusalén, Pampa Hermosa, Titiyacu,

Los Jardines and Nuevo Porvenir. These community companies generated 3,803

total job positions in the different work fronts, such as selective felling, weed

cutting, reforestation and erosion control, among others.


COMMUNITY

On many occasions, our work with the

communities rewards us with special

recognitions that, beyond the objectives

of the areas where the company is

involved, confirm our goals and

encourage us to double our efforts.

In this edition, we share some distinctions

received by our Peru units.

AWARDS AND RECOGNITIONS


2014 PROINVERSION AWARD FOR SOCIAL INCLUSIONDuring the reporting period, Pluspetrol Norte was awarded this recognition

within the Works for Taxes program, for the management of an entrepreneurship

in the rain forest region. The winning project consisted in the construction

of a high school educational center -agricultural modality- in the Nuevo Andoas

community in Block 1AB.

SUSTAINABLE DEVELOPMENT 2014 AWARD, SOCIO-ENVIRONMENTAL MANAGEMENT CATEGORYThe Community Environmental Monitoring Program of Corrientes River, which

PPN promotes in the region of Loreto jointly with indigenous communities in

the area of influence of Block 8 and the NGO Pro Naturaleza, won the award

for “Sustainable Development 2014”, organized by the National Oil, Mining

and Energy Society (SNMPE). The PMAC Corrientes was awarded first place in

the category of Environmental Management, which recognizes the efforts in

conservation and efficiency in the use of natural resources and the prevention,

rehabilitation and recovery of affected areas.

It was also declared as a finalist in the category of Biodiversity Management

2014 in the National Environmental Award, granted by the Ministry of

Environment. In this case, it has been recognized for its work in the recovery

of the quality of ecosystems, including emblematic species of Corrientes

River basin as the taricaya (river turtle), the black caiman and amazonian fish.

CAMISEA, PERU

RECOGNITION OF PISCO SOCIETY

The Chamber of Commerce of Pisco recognized Pluspetrol for its commitment

and accountability with the society of this province. The award was made

official within the framework of the Chamber’s 79th anniversary, highlighting the

coordinated joint work by the company and Pisco’s different stakeholders, as

well as its contribution to the execution of several programs and projects aimed

at driving local development.

Also, we must point out that the Department of Education distinguished Camisea

with a Diploma, recognizing Pluspetrol’s contribution to Educational

development. Since 2008, different educational programs have been carried out

for the benefit of students in the Pisco province and in the native communities of

the Lower Urubamba.

WE MANAGE RISK AS AN ESSENTIAL PART OF OUR ACTIVITY; WE

TAKE DECISIONS ACCORDING TO THEIR LEVEL, MINIMIZING NEGATIVE

IMPACTS AND OPTIMIZING THE BENEFITS AND OPPORTUNITIES

CREATED BY OUR ACTIVITY DURING THE LIFETIME OF OUR PROJECTS.

WE OPERATE SAFELY AND RESPONSIBLY, WITH A PREVENTIVE

APPROACH, WHICH SEEKS TO AVOID ALL KINDS OF INCIDENTS AND

MINIMIZE ADVERSE IMPACTS ON STAFF, THE ENVIRONMENT AND

OUR NEIGHBORS.

SAFETY & INTEGRITY

TRAINING & LEARNING

SAFETY AND OPERATIONS

INTEGRITY MANAGEMENT

SAFETYAND OPERATIONS

INTEGRITY

88 • Pluspetrol

PERFORMANCEINDICATORS

Ramos Gas Plant,North Area, Argentina.


Ramos Gas Plant,North Area, Argentina.

Operational Excellence

is the strategy defined from

Operations to achieve growth,

value creation and long-term

sustainability objectives. Safety

& Operations Integrity

management excellence involves

ensuring an optimum risk and

integrity management, establishing

continuous improvement processes

to minimize incidents and

losses, and appropriate contingency

management.

Mary Stella CorsaroSafety & Operations Integrity Corporate Manager

90 • Pluspetrol

Over the past 25 years, the industry -and

also Pluspetrol as part of it- has focused

on occupational safety; i.e., managing

people’s safety, by using systems

centered on identifying and managing

risks during the performance of their

duties. The implementation of these

systems has substantially reduced the

frequency of incidents.

In Pluspetrol, we manage a complex risk

portfolio, from the possibility of

occurrence of minor events to major

ones. We have achieved improvements

in their management, and the challenge is

to continue reducing the probability of

major events. The correct management of

the aspects that include, but are not

limited to, asset integrity, management

processes and competence assurance are

key elements to meet this goal. This set

of elements is called Process Safety.

One of the lessons that result from the

major incidents analysis in our activity is

the need to distinguish process safety

and personal safety, and manage both

aspects with the appropriate approach.

OUR SAFETY & OPERATIONS INTEGRITY MANAGEMENT

PERSONALSAFETY

PERSONAL DAMAGE PREVENTION AND MITIGATION

PROCESSSAFETY

FIRE, EXPLOSIONS, CHEMICAL PRODUCT RELEASE PREVENTION AND MITIGATION

SAFETY

Pluspetrol’s management strongly believes that the appropriate implementation

of the Process Safety concepts is the key to minimize the risks of major accidents

in the operations.

THE RISKS RELATED TO PERSONAL OR OCCUPATIONAL SAFETY LEAD TO INCIDENTS WHOSE IMPACT IS LIMITED TO THE WORKERS INVOLVED IN THE TASK.

PROCESS SAFETY-RELATED RISKS LEAD TO MAJOR INCIDENTS DUE TO THE RELEASE OF POTENTIALLY HAZARDOUS MATERIALS OR ENERGY, WHICH IMPACT ON THE WORKERS, THE COMMUNITY, THE ENVIRONMENT, THE FACILITIES AND/OR THE BUSINESS CONTINUITY.

PROCESS SAFETY

This is a disciplinary framework

for the integrity management of

operational systems and processes

that handle hazardous substances.

It is based on the best practices

for design principles, engineering,

operation and maintenance.

LOW CONSEQUENCE HIGH FREQUENCY

HIGH CONSEQUENCELOW FREQUENCY

Source: ccps

SAFETY

All the actions necessary to prevent catastrophic events

(explosions, fires, environmental disasters)

WHAT DOES PROCESS SAFETY IMPLY?

CHANGE (CULTURAL EVOLUTION)

ENSURE THE IMPLEMENTATION OF PLUSPETROL’S INTEGRITY STANDARD, BY COORDINATING THE DEFINITION OF PROCESSES, STANDARDS AND PRACTICES, PROVIDING MANAGERS WITH SUPPORT, USING AS LEVERAGE CULTURE MANAGEMENT AND THE ARTICULATION OF THE NECESSARY COMMUNICATION.

SAFETY

DEVELOP SAFETY POLICIES AND STRATEGIES FOR PLUPETROL, PROMOTING MANAGEMENT ALIGNMENT WITH INTERNATIONAL STANDARDS.

ENSURE AN APPROPRIATE DISSEMINATION AND IMPLEMENTATION OF SUCH POLICIES AND STANDARDS, AND THEIR ALIGNMENT WITH THE COMPANY’S STRATEGY.

ASSET INTEGRITY

DEVELOP ASSET INTEGRITY POLICIES AND STRATEGIES FOR PLUSPETROL, PROMOTING THE MANAGEMENT’S ALIGNMENT WITH INTERNATIONAL STANDARDS. ENSURE AN APPROPRIATE DISSEMINATION AND IMPLEMENTATION OF SUCH POLICIES AND STANDARDS, ANDTHEIR ALIGNMENT WITH THE COMPANY’S STRATEGY.

RISK MANAGEMENT AND CONTINGENCY PLANS

ENSURETHE SAFETY AND INTEGRITY RISK MANAGEMENT OF PLUSPETROL’S OPERATIONS, ALIGNED WITH THE PROCESS SAFETY MANAGEMENT (PSM) PRINCIPLES THROUGHTHE DEFINITION OF THE RISK MANAGEMENT PROCESSES.

ENSURE THE ALIGNMENT OF ALL THE CONTINGENCY PLANS WITH THE IDENTIFIED RISKS, AND THEIR QUALITY.

ENSURE THAT THE INSURANCES PROCURED ARE ALIGNED WITH THE IDENTIFIED RISKS.

S&OI STRUCTURE

By understanding this change, Pluspetrol has evolved considering the Safety

concept as an approach that manages Personal Safety and Process Safety, so that

Occupational Health and Safety has accompanied this change process renaming

it as Safety & Operations Integrity (S&OI), and its challenge is set up in four general

chapters, one for each subject area that constitutes the Management structure.

THE RIGHT PEOPLE WITH THE RIGHT SKILLS

APPROPRIATE ORGANIZATION● PROCEDURES● GUIDES

TOOLS

WITHIN AFRAMEWORK OF

THE SENSE OF VULNERABILITY


TRAINING AND LEARNING

Year after year, we offer different Safety-related

training courses aimed at our collaborators as well as

contractors, in order to increment their knowledge

and strengthen their skills, favoring a higher

professional growth and performance when carrying

out their tasks safely. Such courses are defined

based on the people’s roles and responsibilities, and

the risks present in the position they serve.

Additionally, during 2014, we worked to incorporate

into the organization the skills and abilities required

to manage Process Safety. A series of learning

spaces have been planned, which will enable the

organization to acquire knowledge on keynote

aspects.

92 • Pluspetrol

SAFETY

OUR CHALLENGES

TO INTEGRATE PROCESS SAFETY INTO

MANAGEMENT, IN ORDER TO ENABLE

EARLY DETECTION OF DEVIATIONS

SO AS TO MINIMIZE POTENTIAL MAJOR

ACCIDENTS

TO DEFINE AND IMPLEMENT SAFETY

MANAGEMENT STANDARDS AND

TOOLS SO AS TO INCORPORATE THE

BEST PRACTICES OF THE INDUSTRY

AT AN INTERNATIONAL LEVEL, AND

COMPLY WITH THE LOCAL LAWS AND

STANDARDS IN EVERY BUSINESS UNIT

TO POSITION OURSELVES WITHIN THE

IOGP WORLD TRIF30 TOP QUARTILE

TO BE RECOGNIZED AS SAFETY

LEADERS IN ARGENTINA AND PERU

PROCESS SAFETY

STANDARDS DEFINITION

HOURS OF TRAINING RECEIVED PER PERSON

12.1832

2.33

2.42

14.5

7.2

TRAINED PERSONNEL31

2,053

2,369

7,027

4,705

16,154

TOTAL TRAINING HOURS

25,006

5,520

17,021

68,251

115,798

TRAININGS BY BUSINESS UNIT

Bolivia

Argentina

PPN, Peru

Camisea, Peru

Total

•

•

•

•

The first event that Pluspetrol’s staff had an

opportunity to attend this year was the Latin

American Process Safety Congress, which lasted 4

days, and where a significant number of employees

from different roles and business units were able

to share knowledge and experiences.

During November and December, personnel from

technical and operational areas attended the course:

CCPS “Foundations of Process Safety”, whose

aim is to strengthen knowledge on Process Safety,

based on a need for the implementation of

an efficient management system to increment

operational efficiency, based on 4 pillars and 20

elements from the Risk Based Process Safety.

30. Total recordable incidents frecuency / Frecuencia del total de incidentes registrables.31. It includes both, its own personnel and contractors.32. The average hour value per person is higher than for the rest of the BU. The explanation is that in such BU an exploratory project was developed, which tripled its workforce for a few months. These people receive a thorough short-term safety training program.

PERFORMANCE INDICATORS

TRAINING AND LEARNING


TRAINING AND LEARNING PRACTICES

SAFETY AND HEALTH AT WORK WORLD DAY CELEBRATIONS - CAMISEA, PERU

On the celebration of the World Day for Safety and Health at

Work, during the week of April 28, a space for reflection was

generated throughout the areas of the company, both at

the corporate level as well as in the business units. The topics

addressed included, among others, Process Safety; Hand

Protection, Noise and Hearing Preservation; Chemical Products

Handling; Behavior-Based Safety.

BRIGADE TRAINING AT CORCOBO FIELD, ARGENTINA

The Corcobo field has its own brigade squad to fight fires. Once

a week, this brigade –which received formal training on

firefighting at the Argentine Fire Fighting and Training Center

(Centro Argentino de Lucha Contra Incendios y Conducción,

CALCIC), and on first aid– meets to debate different topics of

interest for the brigade and to carry out fire fighting drills.

DRILLS, CAMISEA, PERU

Level II Emergency DrillOn May 28 and December 20, Level II Emergency drills where

carried out. The aim was to assess the appropriate control

techniques for potentially inflammable gas leaks in pressurized

equipment, using the resources assigned to emergency

response.

Helicopter Crash and Rescue DrillIn August, a planned helicoptercrash landing and rescue drill

was conducted in the Urubamba river; to this end the

procedures that need to be applied to timely and efficiently face

the occurrence of potential emergencies that might take place

during the course of our operations were carried out; in addition,

the Crisis Committee activation drill was also carried out,

assessing the actions taken in response to the emergency.

These practices enable us to face, in an appropriate, fast and

safe way, the occurrence of emergencies that could happen in

our operations, therefore raising the level of response of our

personnel in the different areas, and especially of our emergency

brigade.

RECOGNIZING OUTSTANDING SAFETY PERFORMANCE, PLUSPETROL NORTE, PERU

As part of Block 8’s safety program, there has been ongoing

recognition of the work crews who have demonstrated

management of best safety practices in the activities they

perform; this recognition is part of the organization’s

commitment of creating a safety culture within our operations.

SAFETY


Currently, the Occupational Health and

Safety Management Systems (OH&S)

constitute a tool that enables business

units to ensure the appropriate

application of our corporate safety

criteria related to personal safety. At the

same time, they contribute to the

continuous improvement of processes

development in all our operations.

Our challenge is to continue enhancing

our systems through the appropriate

incorporation of the relevant standards.

OCCUPATIONAL HEALTH AND SAFETY MANAGEMENT SYSTEM (OH&S)

Certifications OHSAS 18.001 were maintained for Ramos Field, Balbuena Tank Farm, Sweetening Plant and Pluspetrol’s Base in the North Area. Two semiannual Follow-up Audits were conducted.

ARGENTINA

Certifications OHSAS 18.001, obtained in 2012, are maintained, which comprise the Santa Cruz offices and Tacobo and Tajibo fields. In 2013, said standard was certified in Curiche field. In Bermejo, the management system was implemented although without this certification yet.

BOLIVIA

The management system responds to the requirements of OHSAS 18001:2007, as well as the procedures that Camisea has defined and implemented for the performance and improvement of its Environment, Safety and Occupational Health Management. The system deployed covers all the BU’s fields, and in 2014, it received its second re-certification.

CAMISEA, PERU

A search for best practices (benchmarking) in other organizations (IOGP, OSHAS, API) has been made for the implementation of the integrated management system in PPN.


●

●

●

●


Different health and safety committees

work in Pluspetrol’s units, which are

often comprised of the units’ leaders,

people responsible for health and

safety management, and employees’

representatives. Committees meet

regularly, and during the meetings, they

mostly analyze lessons learned from

undesired events, strategies and action

plans are proposed, and commitments

for safety management are taken.

SAFETY

COMMITTEES

ORGANIZATIONAL STRUCTURE DESCRIPTION

Monthly reviews of high potential undesired event investigations, and related actions follow-up.Contractors Biannual Working Day

Two types of occupational health and safety committees: the EHS committees and the Mixed Occupational Health and Safety Committees (legal requirement of the Bolivian legislation).

The EHS Committee is in turn divided into Local EHS Committees (one per each field: Tacobo, Tajibo, Curiche, Bermejo) and a Central EHS Committee (which in turn represents the Santa Cruz office).

Also, there are two Mixed Occupational Hygiene and Safety Committees. One of the Committees represents workers from the Tacobo, Tajibo and Curiche fields, including the Santa Cruz office. And the remainder represents the workers from Bermejo and Toro fields.

Country Safety Committee: comprised of the senior management of Camisea.

Workplace Health and Safety Committee: is a joint governing body of workers and management that evaluates and reviews the global performance of the health, safety and environment management system, and undertakes initiatives to ensure performance is adequate to their objectives and goals.

Lima IMS Committee: led by the Executive Management; it reviews the overall performance of the integrated management system twice a year, and sets improvement and growth strategies .

Malvinas and Pisco IMS Committee: led by the Malvinas and Pisco plant managers; it reviews the Safety, Health and Environmental performance of each of the Camisea operations on a monthly basis.

Area Subcommittees: they execute Safety, Health and Environmental initiatives and guidelines issued by the Committee of each operation.

Camisea Shielding Committee: comprised of Camisea technical authorities and the organization’s directors, in order to establish initiatives aimed at ensuring process Safety in the facilities.

In every operating area (Neuquén, Rio Colorado, Ramos and GETSA) a monthly committee is held, comprised of the area Manager, Safety personnel and operational leaders. This committee analyzes the indicator results of the month; undesired events are presented, together with the investigation results of such events; the safety highlighted facts of the month, as well as follow-up of the corrective actions.

Bimonthly, Argentina’s safety committee meets, with the participation of the Country manager, the Operations manager and operations support areas managers. In this framework, reactive and proactive indicators are analyzed, and safety standards are approved for the business unit.

Safety, Health and Environment Committee: Monthly meetings in both blocks, with contractractor companies representatives and Pluspetrol Management teams at the operational sites. The lessons learned from undesired events are analyzed, strategies and action plans are proposed, and commitments for safety, health and environmental management are taken.

Electrical Safety Committee: Quarterly meetings at Block 1AB, led by the Maintenance Department and comprised of representatives from different maintenance-related companies.

Joint Safety Committee: Implemented as required by law and carried out with representatives of the workers from both blocks and the company, at the Lima offices. For 2015, a change in the committee’s board of directors is planned.

Logistics Safety and Fluvial Transport Committee: implemented by Camisea in 2013 and extended to PPN in 2014, it discloses on a monthly basis safety and operational aspects of piers and rivers used by water units that serve both of Pluspetrol’s business units in Peru.

Country Safety Committee: Quarterly meetings with participation of the company senior management. The lessons learned from undesired events and Safety management core matters are analyzed, and progress in Corporation Safety matters is presented.

BO

LIV

IAC

AM

ISE

A, P

ER

UA

RG

EN

TIN

AP

LU

SP

ET

RO

L N

OR

TE

, P

ER

U

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

OPERATION

CO

RP

OR

AT

ION


PERFORMANCEINDICATORS

The work done by Pluspetrol to improve its safety

performance includes changes in the way it measures

it. It consists in the incorporation of an indicator

called Total Recordable Cases (TRIC) into the

management follow-up, which includes a record of all

the events classified as “medical treatment, restricted

work and lost days incidents”, trying to achieve the

objective of zero recordable events.

In 2014, the corporate frequency index for accidents

with lost time was 1.00, 60% lower than in 2013. In

relation to the severity rate , its value was 0.05, a

20% decrease compared to the previous year.

In turn, Pluspetrol has started measuring process

safety events. We started in Camisea, Peru, to later

transmit the experience to the rest of the units.


1

BOLIVIA

120

100

80

60

40

20

0

NEW MEMBERSHIPS IN INTERNATIONAL BODIES - IN LINE WITH OPERATIONAL EXCELLENCE

CCPS is the Center for Chemical Process Safety,

an organization that identifies and establishes the

needs for process safety in the chemical,

pharmaceutical and oil industries, together with the

American Institute of Chemical Engineers. Its

members work in committees and develop guidelines

with practical application in the industry. It has over

100 publications, focusing on 5 principles: culture,

standards, competences, management systems and

lessons learned. In the site http://www.aiche.org/

ccps you may find guides and guidelines for process

safety, from the design and construction to process

plant operation.

Pluspetrol’s engagement in these organizations

shows its eagerness to stand out as a benchmark

company among international power companies, and

to implement the best practices in line with

international standards.

33. Frequency rate: number of accidents with lost time accumulated during the year, per million hours worked. 34. Severity rate: number of lost days accumulated during the year, per thousand hours worked.

••

TOTAL RECORDABLE CASESTOTAL RECORDABLE CASES/HOURS WORKED

6

5

4

3

2

1

0

9

68

22

100

CAMISEA,PERU

PPN,PERU

ARGENTINA TOTALPLUSPETROL


OTHER ACTIONSTAKEN DURING 2014

BOLIVIA

“3D Seismic Exploration, Tacobo and Curiche Fields:

The execution of this project, which lasted 5 months,

involved 650 people average, reaching 1,500 people

at its highest peak. It involved 1,082,500 man hours

worked. The operation was conducted through land

and airborne vehicles, so a helicopter and lifting

device audit plan was implemented. We must point

out the absence of LTICs35 and HIPOs36 during the

overall execution of the project.

“Pluspetrol Family Health and Safety Day”: This

event, which was held in November, was massively

attended by Pluspetrol workers and their families,

and its aim was to work on integration and raising

awareness with relation to health, home safety,

nutrition, and office gym.

ARGENTINA

Cross-audit implementation. An audit program was

set up, where the area managers, together with an

assistant auditor, visited and audited other business

areas in Argentina. Besides auditing the degree

of compliance with the safety standards, the activity

enables sharing experiences and best practices.


Modifications to the scope of the Contingency

Plan to be followed in Blocks 8 and 1AB. 2 reviews

were performed in 2014.

Evaluation of Blocks 8 and 1AB’s major risks,

following the Operational Risk Management (ORM)

approach.

CAMISEA, PERU

Classification process of Undesired Events (UER) for

PSM (Process Safety Management): implementation

was initiated according to Standard API 754 and the

IOGP (International Oil and Gas Producers) Report

456 guidelines.

Work Monitoring: This work system was put into

practice, which describes the planning required, the

control barriers and authorizations necessary to

execute critical and non-critical tasks within

Pluspetrol’s operations. This work system contains

processes as relevant as hazard identification and

task risk analysis; work permits system, competence

verification, operational discipline, etc.

Change Management: Review of this process was

carried out, whose purpose is to identify monitoring

measures to minimize the risks caused by changes of

an organizational, structural, process, procedural

nature, etc. The Change Management procedure also

defines the levels of authorization required to

approve such changes.

SAFETY

35. LTIC = Lost Time Injury Case36. HIPO = High Potential Incident

•

•

•

•

•

•

•

•

GRI INDEXPLUSPETROL HAS ELABORATED ITS SUSTAINABILITY

REPORT BASED ON THE GLOBAL REPORTING INITIATIVE

GUIDELINES, INCLUDED IN THE G3.1. GUIDELINES AND

THE OIL AND GAS SECTOR SUPPLEMENT, REACHING A

C APPLICATION LEVEL37.

98 • Pluspetrol

37. To indicate that a report is GRI-based, the organization should declare the level to which it has applied the GRI Reporting Framework for its elaboration via the “GRI Application Levels” system. There are three Application Levels: C, B and A, the latter being the one showing the greatest application of the GRI Framework.


GRI INDEX

Explanation of the effect of any restatement of information providedin earlier reports, and the reasons forsuch restatement.

Significant changes from previous reporting periods in the scope.

GRI Content IndexTable identifying the location of the Standard Disclosures in the report.

AssurancePolicy and current practices with regard to seeking external assurance for the report.

GOVERNANCE, COMMITMENTS AND ENGAGEMENTOF STAKEHOLDERS

GovernanceGovernance structure of the organization, including committees under the highest governance body responsible for specific tasks, such as setting strategy or organizational oversight.

Indicate whether the Chair of the highest governance body is also an executive officer.

State the number and gender of the members of the highest governance body that are independent or non-executive member.

Mechanisms for shareholders and employees to provide recommendations or direction to the highest governance body.

Linkage between compensation for members of the highest governance body, senior managers and executives (including departure agreements) and the organization’s performance (including social and environmental performance).

Processes in place for the highest governance body to ensure conflicts of interest are avoided.

Process for determining the composition, qualifications and expertise of themembers of the highest governance body and its committees.

Internally developed statements of mission or values, codes of conduct, and principles relevant to the economic, environmental, and social performance, and the status of their implementation.

Procedures of the highest governance body for overseeing the organization’s identification and management of economic, environmental, and social performance, including relevant risksand opportunities, as well as adherenceor compliance with internationallyagreed standards, codes of conduct,and principles.

Processes for evaluating the highest governance body’s own performance, particularly with respect to economic, environmental, and social performance.

Commitments to External InitiativesExplanation of how the precautionary approach or principle is addressedby the organization.

Externally developed economic, environmental, and social charters, principles, or other initiatives to whichthe organization subscribes or endorses.

STRATEGY AND ANALYSIS

Statement by the most seniordecision-maker of the organizationabout the relevance of sustainabilityto the organization and its strategy.

Description of key impacts, risks,and opportunities.

ORGANIZATIONAL PROFILE

Name of the organization.

Primary brands, products and/or services.

Operational structure of theorganization, including main divisions, operating companies, subsidiaries and joint ventures.

Location of the organization’sheadquarters.

Number of countries where the organization operates, and namesof countries with either majoroperations or that are specificallyrelevant to the sustainability issuescovered in the report.

Nature of ownership and legal form.

Markets served (including geographical breakdown, sectors served and types of customers/beneficiaries).

Scale of the reporting organization.

Significant changes during the reporting period regarding size, structure and ownership of the organization.

Awards received in the reporting period.

REPORT PARAMETERS

Report profileReporting period.

Date of most recent previous report(if any).

Reporting cycle(annual, biannual, etc.).

Contact point for questions regardingthe report or its content.

Report Scope and BoundaryProcess for defining report content.

Scope of the report.

State any specific limitations on the scope or boundary of the report.

Basis for reporting on joint ventures, subsidiaries, leased facilities, outsourced operations and other entities that can significantly affect comparability from period to period and/or between organizations.

Data measurement techniques andthe bases for calculations.

2 and 3

15, 16, 30, 38, 72 and 96

Pluspetrol.

8, 9, 26 and 27

8 and 9

Buenos Aires, Argentina.

8, 9 and 25

Licensee and/or concessionaire of hydrocarbon exploration and exploitation. Anonymous society

8

8, 9, 26, 27, 32 and 33

1 and 29

95

The report covers January 1 - December 31, 2014 period.

2013

Annual.

Backcover.

20

1

We report on the performance of Pluspetrol’s production areas, that is, our activities in Argentina, Bolivia Peru and some aspects of Angola.

1

All the disclosures concerning data collection techniques and calculations are detailed throughoutthe report.

In the cases where there was a restatement of information corresponding to previous reports, it was explained in the contents of this report together with the reason that originated such restatement.

1

106-110

The report hereby has not been subject to external assurance.

12 and 13

The President of the Board is also the Executive Chief of the Company.

The Board of Directors is comprised of 3 independent members.

20

N/D.

N/D.

N/D.

13 and 14

14-19

N/D.

14-19

63 and 71-95

STATUS PAGE / ANSWERDETAIL

3.10

3.11

3.12

3.13

4

4.1

4.2

4.3SE15

4.4SE16

4.5

4.6

4.7

4.8

4.9

4.10

4.11

4.12

1

1.1

1.2

2

2.1

2.2

2.3

2.4

2.5

2.6

2.7

2.8

2.9

2.10

3

3.1

3.2

3.3

3.4

3.5

3.6

3.7

3.8

3.9

•

•

•••

••

•

•

••

•

•

•••

•••

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

STATUS PAGE / ANSWERDETAIL

STATUS PAGE / ANSWERDETAIL STATUS PAGE / ANSWERDETAIL

N/D.

N/D.

46

No amounts are invested in renewable energy.

Pluspetrol does not generate energy from renewable sources.

46Consumption by corporate buildings is not included.

46 and 47

N/D.

N/D.

59

59, 60 and 61None of the water sources from where Pluspetrol captures consumption water in its operations is on the International Relevant Wetlands List (Ramsar List). Operations in Camisea, Peru, are situated in the Lower Urubamba Region, Cusco department, and they capture surface consumption waterfrom Urubamba River. In the case of PPN, a sector of our operations is located in Cordillera Azul National Park.

59

62-67

62-67

62-67

62-67

62-67

62-67www.pmbcamisea.com

44-47

N/D.

44 and 45

Main associations (such as industry associations) and/or national/international entities the organization supports and is engaged as a member.

Stakeholder EngagementList of stakeholder groups engagedby the organization.

Basis for identification andselection of stakeholders with whomthe organization engage.

Approaches to stakeholder engagement, including frequency of engagement by type and by stakeholder group.

Key topics and concerns that havebeen raised through stakeholder participation, and how the organization has responded to those key topics and concerns, including through its reporting.

ECONOMIC PERFORMANCEINDICATORS

Economic PerformanceDirect economic value generatedand distributed.

Financial implications and other risksand opportunities for the organization’s activities due to climate change.

Coverage of the organization’s defined benefit plan obligations.

Significant financial assistance received from governments.

Market PresenceRange of ratios of standard entry level wage by gender compared to local minimum wage at significant locationsof operation.

Policy, practices and proportion of spending on locally-based suppliers at significant locations of operation.

Procedures for local hiring and proportion of senior executives hired from thelocal community at significant locationsof operation.

Indirect Economic ImpactsDevelopment and impact ofinfrastructure investments and services provided primarily for public benefit through commercial, in-kind, andpro bono engagement.

Understanding and describing significant indirect economic impacts, including the extent of impacts.

ReservesVolume and type of estimated proved reserves and production.

ENVIRONMENTALPERFORMANCE INDICATORS

MaterialsMaterials used by weight or volume.

Percentage of materials used thatare recycled input materials.

EnergyDirect energy consumptionby primary energy source.

Total amount invested in renewableenergy.

Total amount of renewable energy generated by source.

Indirect energy consumption byprimary source.

Energy saved due to conservation and efficiency improvements.

Initiatives to provide energy-efficientor renewable energy-based products and services, and reductions in energy requirements as a result of these initiatives.

Initiatives to reduce indirect energy consumption and the reductions achieved.

WaterTotal water withdrawal by source.

Water sources significantly affected by withdrawal of water.

Percentage and total volume of water recycled and reused.

BiodiversityLocation and size of land owned, leased, managed in, or adjacent to, protectedareas of high biodiversity value outside protected areas.

Description of significant impacts of activities on biodiversity in protected areas and areas of high biodiversity value outside protected areas.

Habitats protected or restored.

Strategies, current actions, and future plansfor managing impacts on biodiversity.

Number and percentage of significant operating sites in which biodiversity riskhas been assessed and monitored.

Number of IUCN Red List species and national conservation list species with habitats in areas affected by operations,by level of extinction risk.

Emissions, Effluents and WasteTotal direct and indirect greenhouse gas emissions by weight.

Other relevant indirect greenhouse gas emissions by weight.

Initiatives to reduce greenhouse gas emissions and reductions achieved.

ARPEL (Regional Association of Oil, Gas and Biofuels Sector Companies in Latin America and the Caribbean), IOGP (International Association of Oil & Gas Producers), IAPG (Argentina Oil and Gas Institute), EITI (Extractive Industries Transparency Initiative), CEPA (Argentina Oil Companies Chamber), Argentina-Bolivia Chamber of Commerce, American Chamber of Commerce in Argentina (AMCHAM), Argentina-Canada Chamber of Commerce, Peruvian Hydrocarbon Society (SPH), CCPS (Center for Chemical Process Safety)

20

20

20

20

N/D.

N/D.

N/D.

N/D.

N/D.

94

93

77, 79, 81, 83, 84 and 85

N/D.

27

4.13

4.14

4.15

4.16SE16

4.17

EC1SE4, SE13, SE14

EC2

EC3

EC4SE13

EC5SE15

EC6SE5, SE7

EC7SE5, SE6

EC8SE4

EC9SE6

OG1

EN1

EN2E10

EN3E2

OG2E3

OG3E3

EN4E2

EN5E2

EN6E3

EN7E2

EN8E6

EN9E6

EN10E6

EN11E5

EN12E5

EN13E5

EN14E5

OG4E5

EN15E5

EN16E1

EN17E1

EN18E1

•

••

•

•

•

•

••

•

•

•

•

•

•

••

•••

•

••

•

••

•

•

•

•••

•

•••

100 • Pluspetrol


GRI INDEX

Occupational Health and SafetyPercentage of total workforce represented in joint management-worker health and safety committees to help monitor and advise on occupational health and safety programs.

Rates of injury, occupational diseases,lost day and absenteeism, and total number of work-related fatalities by region and per gender.

Education, training, counseling,prevention and risk-control programs in place to assist workforce member, their families or community members regarding serious disease.

Health and safety topics covered in formal agreements with trade unions.

Training and educationAverage hours of training hours peryear per employee by gender and by employee category.

Programs for skills management and lifelong learning that support the continued employability of employees and assist them in managing their professional careers endings.

Percentage of employees receiving regular performance and career development reviews by gender.

Diversity and Equal OpportunitiesComposition of the corporate governance bodies and breakdown of employees per employee category according to gender, age group, minority group membership and other indicators of diversity.

Equal Remunerationfor women and men Ratio of basic salary of women to menby professional category.

HUMAN RIGHTSPERFORMANCE INDICATORS

Investment and Procurement PracticesPercentage and total number of significant investment agreements and contracts that include clauses incorporating human rights concerns.

Percentage of significant suppliers, contractors and other business partners that have undergone human rights screening, and the actions consequently taken.

Total hours of employee training on policies and procedures concerning aspects of human rights that arerelevant to operations, including the percentage of trained employees.

Non-discriminationTotal number of incidents of discrimination and corrective actions taken.

Freedom of Associationand Collective BargainingOperations and significant suppliers identified in which the right to exercise freedom of association and collective bargaining may be violated or atsignificant risk, and the actions takento support these rights.

Child LaborOperations and significant suppliers identified as having significantrisk for incidents of child labor, and measures taken to contribute tothe effective abolition of child labor.

Forced and Compulsory LaborOperations and significant suppliers identified as having significantrisk for incidents of forced orcompulsory labor, and the measuresto contribute to the elimination ofall forms of forced or compulsory labor.

Emissions of ozone-depleting substancesby weight.

NOx, SOx, and other significant air emissions by type and weight.

Total water discharge by quality and destination.

Volume of formation or produced water.

Total weight of waste by type anddisposal method.

Total number and volume of mostsignificant spills.

Volume of flared and vented hydrocarbon.

Amount of drilling waste (drilling andcutting mud) and strategies for treatment and disposal.

Weight of transported, imported, exported or treated waste deemed hazardous under the terms of the Basel Convention Annex I, II, III and VIII.

Identification, size, protected status, and biodiversity value of water bodies and related habitats, significantly affected by the reporting organization’s discharges of water and runoff.

Products and servicesInitiatives to mitigate environmental impact of products and services, and extent of impact mitigation.

Benzene, lead and sulfur content in fuels.

Percentage of products sold and their packaging materials, which are reclaimed at the end of their lifetime, by category.

Regulatory ComplianceMonetary value of significant fines andtotal number of non-monetary sanctions for non-compliance with environmental regulations.

TransportSignificant environmental impacts of transporting products and other goods and materials used for the organization’s operations, and transporting members of the workforce.

OverallTotal environmental protection expenditures and investments by type.

LABOR PRACTICES AND DECENT WORK PERFORMANCE INDICATORS

EmploymentTotal workforce by employment type, employment contract, and region broken down by gender.

Total number and rate of new employee hires and employee turnover, by age group, gender and region.

Benefits provided to full-time employees that are not provided to temporary or part-time employees.

Return to work and retention rates after parental leave, by gender.

Labor/Management RelationsPercentage of employees covered by collective bargaining agreements.

Minimum notice period(s) regarding organizational changes.

N/D.

43 and 47

60 and 61

60

43 and 48 to 52

43, 48 and 53 to 55

43, 44 and 47

52

Pluspetrol does not import or export this type of waste, pursuant to the Basel Convention.

N/D.

N/D.

Pluspetrol’s operations do not include refining operations.

The products traded by Pluspetrol do not require packaging materials nor may they be recovered at the end of their lifetime given their nature.

N/D.

N/D.

N/D.

32 and 33

32 and 33

35

35

N/D.

N/D.

103

104

36 and 37

N/D.

34, 35, 100 and 101

34, 100 and 101

34

12, 32 and 33

N/D.

N/D.

N/D.

N/D.

N/D.

N/D.

N/D.

N/D.

LA6HS1

LA7HS3

LA8HS2

LA9SE16, HS1

LA10SE17

LA11SE17

LA12SE17

LA13SE15

LA14SE15

HR1SE8

HR2SE9

HR3SE8

HR4SE8, SE18

HR5SE8, SE9

HR6SE8, SE9

HR7SE8

EN19E7

EN20E7

EN21E9

OG5E9

EN22E10

EN23E8

OG6E4

OG7E10

EN24E10

EN25E5, E9

EN26HS4

OG8

EN27

EN28

EN29E1, E8

EN30

LA1SE15

LA2SE15

LA3

LA15

LA4SE16, SE8

LA5SE16

••••••••

•

•

•

•

•

•

•

•

•

•

•

•

••

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•


•

•

•

•

•

•

•

•

•

•

•

•

•

••

•

•

•

102 • Pluspetrol

Asset Integrity and Process SafetyNumber of process safety events,by business activity.

PRODUCT RESPONSIBILITY PERFORMANCE INDICATORS

Customer Health and SafetyLife cycles stages in which health and safety impacts of products and services are assessed for improvement, and percentage of significant products and services categories subject to such procedures.

Total number of incidents of non-compliance with regulations and voluntary codes concerning health and safety impacts of products and services.

Product and Service LabelingType of product and service information required by current procedures and regulations.

Total number of incidents of non-compliance with regulations and voluntary codes, concerning product and service information and labeling.

Practices related to customers satisfaction, including results of surveys measuring customer satisfaction.

Marketing CommunicationsPrograms for adherence to laws, standards or voluntary codes related to marketing communications.

Total number of incidents ofnon-compliance with the regulationsconcerning marketing communications.

Customer PrivacyTotal number of substantiated complaints regarding breaches of customer privacy and losses of customer data.

Regulatory ComplianceMonetary value of significant fines for non-compliance with laws and regulations concerning the provision and use ofthe organization’s products and services.

Fossil Fuel SubstitutesVolume of biofuels producedand purchased meeting sustainabilitycriteria or standards.

Safety PracticesPercentage of security personneltrained in the organization’spolicies or procedures concerninghuman rights that are relevant to operations.

Indigenous RightsTotal number of incidents of violations involving rights of indigenous people and measures adopted.

Operations where indigenous communities are present or affected by activities and where specific engagement strategies are in place.

AssessmentPercentage and total number of operations that have been subject to human right reviews and/or impact assessments.

RemediationNumber of grievances related to human rights filed, addressed and resolved through formal grievance mechanisms.

SOCIETY PERFORMANCEINDICATORS

Local CommunitiesPercentage of operations with implemented local community engagement, impact assessments and development programs.

Operations with significant potentialor actual negative impacts on local communities.

Prevention and mitigation measures implemented in operations withsignificant potential or actual negative impacts on local communities.

Number and description of significant disputes with local communities and indigenous peoples.

Number of sites that have been decommissioned and sites that are in the process of being decommissioned.

CorruptionPercentage and total number ofbusiness units analyzed for risks relatedto corruption.

Percentage of employees trained in organization’s anti-corruption policiesand procedures.

Actions taken in response to incidentsof corruption.

Public PolicyPublic policy positions and participation in public policy development and lobbying.

Total value of financial and in-kind contributions to political parties, politicians and related institutions by country.

Anti-competitive BehaviorTotal number of legal actions for anti-competitive behavior, anti-trust and monopoly practices and their outcomes.

ComplianceMonetary value of significant fines,and total number of non-monetarysanctions for non-compliance withlaws and regulations.

Involuntary ResettlementOperations where involuntary resettlement took place, the number of households resettled and how their livelihoods were affected in the process.

N/D.

N/D.

N/D.

N/D.

N/D.

N/D.

N/D.

N/D.

N/D.

N/D.

Pluspetrol does not produce or purchase biofuels.

N/D.

N/D.

88 to 91

N/D.

N/D.

72-95We evaluated the social and environmental impact of all our operations, and we developed social programs in cooperation with the community.

86, 87 and 90

86, 87, 90 and 91

86 and 87

No sites were decommissioned during the report period.

N/D.

N/D.

N/D.

N/D.

N/D.

N/D.

N/D.

During 2014, we did not promote involuntary resettlement of any of the communities settled in the direct or indirect area of influence of our operations.

The premises, initiatives, descriptions, programs, processes and other activitiesmentioned in this Sustainability Report shall not be deemed or construed either byimplication or analogy, as legal, contractual obligation, or enforceable agreements,beyond any consequence resulting from any formal or express sources of legal liability.

Such sources do not account or hinder their continuity, improvement or extensionunder the same or different circumstances, without the existence of an expressacknowledgement in that regard.

HR8SE10

HR9SE2

OG9SE2

HR10SE8

HR11SE18

SO1SE1

SO9SE1

SO10SE1

OG10SE1, SE3

OG11SE8

SO2SE11, SE12

SO3SE11

SO4SE11, SE12

SO5SE14

SO6SE14

SO7

SO8

OG12SE3

OG13HS5

PR1HS4

PR2HS4

PR3HS4

PR4HS4

PR5

PR6HS4

PR7HS4

PR8

PR9

OG14E3

•

•

•

•

•

•

•

•

•

•

•

N/D

References

Reported

Partially reported

Not reported

Not declared

•••


SURVEY

OPINION POLL2014 SUSTAINABILITY REPORT

Through the following Opinion Poll you can send us your

comments and suggestions to improve our Sustainability

Report in the future.

You may contact us by e-mail to

[email protected] or by regular

mail to the following address: Gerencia de Medio Ambiente

- Lima 339 - C1073AAG Buenos Aires - Argentina.

1. WHAT TYPE OF STAKEHOLDER ARE YOU?

2. HOW MUCH HAVE YOU READ OF THIS REPORT?

3. WHAT DO YOU THINK OF THE LENGTH OF THE REPORT?

4. GENERAL OPINION ABOUT THE REPORT

5. OPINION ABOUT THE CONTENTS OF EACH CHAPTER

6. WHAT OTHER INFORMATION WOULD YOU LIKETO FIND IN SUBSEQUENT REPORTS?

7. DO YOU HAVE ANY OTHER COMMENTS ABOUTOUR 2014 SUSTAINABILITY REPORT?

CUSTOMER SHAREHOLDER PROVIDER

EMPLOYEEOTHER

(SPECIFY)

ALL OF IT ENOUGH A LITTLE VIRTUALLY NOTHING

SHORT APPROPRIATE LONG

4.1 GENERAL OPINION

4.2 RELEVANCE OF INFORMATION

4.3 LANGUAGE AND WRITING

4.4 DESIGN

VERY GOOD GOOD AVERAGE POOR

5.1 CEO’S LETTER AND INTERVIEWWITH THE DIRECTOR OF ENVIRONMENT

5.2 ABOUT PLUSPETROL

5.3 OUR PEOPLE

5.4 ENVIRONMENT

5.5 COMMUNITY

5.6 SAFETY

VERY GOOD GOOD AVERAGE POOR

Editing and Coordination:

Strategic Environmental

and Social Management

Design and production:

Chiappini + Becker

Tel. +54 11 4314 7774

www.ch-b.com

www.pluspetrol.net

AngolaVia AL5, Predio Cellwave, 3º Andar,Bairro Talatona, Luanda - AngolaTel: 244-222-309-302Fax: 244-222-309-091

ArgentinaLima 339 - C1073AAg -Buenos Aires - ArgentinaTel: 54-11-4340-2215Fax: 54-11-4340-2215

BoliviaAv. Grigotá esquina calle Las Palmas -Santa Cruz de la Sierra - BoliviaTel: 591-3-359-4000Fax: 591-3-354-8080

ColombiaEdificio Torres Unidas 2, Av. Cra. 9 #113-52 - Of. 1802 - Bogotá - ColombiaTel: 57-1-592-3777

USA5599 San Felipe Suite 1000 - Houston, Texas 77056 - USATel: 1-713-961-1095Fax: 1-713-961-1097

NetherlandsMuiderstraat 7A - 1011,PZ, Ámsterdam - NetherlandsTel: 31-20-662-2199

PeruAv. República de Panamá 3055 - Piso 8San Isidro, Lima - PeruTel: 51-1-411-7100Fax: 51-1-411-7120/7142

UruguayLuis Alberto Herrera 1248 - World TradeCenter - Torre 2, Apto. 17 - 11300 -Montevideo - UruguayTel: 59-82-1838-3200

VenezuelaTorre Forum, Pb Oficina “B” - Guaicaipurocon Av. Ppal. de las MercedesUrb. El Rozal, Caracas (1060) - VenezuelaTel: 58212-952-8475 / 953-8112

Sustainability Report - Pluspetrol

Documents

Transcript of Sustainability Report - Pluspetrol