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Background of the Kashagan fight

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The latest events in the oil and gas sector, particularly, the clash between local and Indian workers at D Island cause serious concerns.

According to NCOC, from 30 to 40 local and foreign workers of two contractor companies were involved in the fight. The skirmish began amid a banal tea break queue quarrel in canteen, as reported by prosecutors. Our sources said it started after someone spilt tea on somebody.

The prosecution's press release states two companies' workers who were involved in the fight, had been working together for more than 5 years. Over this period there wasn't a single dispute, conflict or clash between them. Both parties of the conflict, Kazakhs and Indians, now regret about the incident. 

Of course, why exaggerate such cases and distort the truth? But we still don't know the number of victims of the mass disorder at Tengiz in 2006. That was a similar story - allegedly, a Kazakh worker had tried to shortcut the queue in canteen and by doing so  caused anger of his three Turkish colleagues. The other version says Turks refused to sign a work permit and beat up a fire safety supervisor of Kazakh ethnicity. This emerged a cause for mass fight involving hundreds from both sides. In the result, 150 Turkish workers received injuries. Possibly, some were killed.

There is a mere reason for such displays of aggression - they resulted from the humiliating situation of Kazakh workers. In the light of all these, the prosecutor's press release about the D Island clash even scares us. One hardly believes that the sides experienced warm feelings towards each other.

What bothers us most is the lack of consistency of our authorities. At the end of the last year, the cabinet of Karim Massimov decided to exempt three major investment projects - Karachaganak, Kashagan and Tengiz from the limitation on intake of foreign workforce until 2015. At the time it was clear that proportion of Kazakhs and expatriates there wouldn't come out in our favour. Foreign investors were allowed to do whatever they like.

In September, this year, at the Investment Forum, Lyazzat Kiinov, CEO of Kazmunaygas National Company, told about a threat of unemployment, claiming the need to create new productions and jobs in West Kazakhstan. Why then they vacated jobs in our oil projects? Didn't they mean they wanted to resolve the employment issues of Europe, which is now suffering from the heavy economic crisis? It is well known that midlevel managers from Europe, in a wink, become top managers in our projects. Or did they aim to provide the peoples of friendly India and Philippines with stable salaries?   

Another question: where are our specialists that acquired experience in similar projects? Will we throw them outside to join the army of unemployed until new productions are created?

What about the President's doctrine of building up a society of universal labor? The main message of the President is to minimize social tension in the society and eradicate reasons that may lead to social protests. By the way, following the cabinet's decree, the number of national staff at Kashagan is reducing, possibly local workforce will be minimized at other projects as well. And those criticized by the President will stay in their seats.

Another question that strongly irritates local personnel is the inequality in remuneration of labor, working conditions and the difference in social benefits provided to our people and foreign nationals.

No one doubts the need for investment in Kazakh economy, given Kazakhstan has neither money, nor technologies to perform complex projects on its own. For their support in this investors will soon get our Kashagan oil at very favorable conditions. 

Besides future oil revenues and large preferrences in Kazakhstan, foreigners are enjoying unprecedented living conditions here.

An Internet user nicknamed as Marina left the following comment at one of webforums: "Their (expats') labor compensation fund in Kashagan project is covered by operating costs, which is in turn covered by the Kazakh side. It means we pay them $45-60 thousand every month at the expense of Kazakhstan's share in future oil revenues. The payment schemes are very smart - transactions go through recruitment agencies both abroad and in Kazakhstan.

Salaries paid in Kazakhstan are modest. How much expats get paid via recruitment agencies is a deep hidden secret. They keep it secret to avoid paying big taxes here and show Kazakh prosecutors drawn pennies that they allegedly earn in Kazakhstan.

I understand they need highly qualified foreign specialists that we don't have here. But not that randomly as they do bringing here everyone.

Nobody from the Kazakhstan side does the inventory of the workplaces occupied by the expats, given that we pay them so much. Why do we need expatriate PR-directors, commercial directors, administrative staff, human resources staff?! We have enough appropriate candidates of our own.

There is a whole story with Kashagan project. In Atyrau NCOC maintains a large taxi pool dedicated to serve, first of all, expats, their wives and children, etc. They don’t have the right to move around the city in normal cars - only by 24-hour free taxi service arranged  by the company. So, it appears that our drivers, like slaves, in the nights rush to expats upon their call to serve them while the latter visit local prostitutes, wait for them in the cars, and sometimes drive expats with their prostitutes around. And expenses for fuel and drivers’ salaries are covered by Kazakhs. THIS IS MARASMUS. Besides, Agip has the whole department that deals with the household issues of expat workers. Our “silly women” from morning through evening drive around the city to buy everything expats’ wives ask, even sanitary towels and toilet paper and take these to their houses. Kazakh employees of these companies seconded to oversea units don’t get the same degree of indulgency.

And when the local Kazakhstan employees need to travel on business – then using the company taxi is forbidden!

Discrimination is in everything – in provision of social benefits, work conditions, salary payments, etc.”

The first civil trial in the history of the country, challenging the legality of the huge difference in salary payments of Kazakhstan and expat employees, demonstrated that the authorities have no intention to fight discrimination of their compatriots. To recall, the labour department lost the case in the first court instance. 

Let me add: the latest events testify that the corruption component which has deeply embedded into the system of power and domestic oil industry, for a long time has been blossoming at the major oil and gas projects with foreign participation.

The scheme is virtually the same as with embezzlement of budgetary funds. The same doubtful tenders where the work scopes are given to “their” companies, and they, in turn, trust the work to subcontractors.

As the result we have here failure to meet deadlines and poor quality. But it is one thing when it comes to social facilities slop-built somewhere in deep rural places (however, it doesn't relieve responsibility from builders and officials), and quite another matter when it concerns the largest oil and gas projects. When billions of dollars are at stake, as well as state interests and the most important thing - the lives and health of the Pre-Caspian people.


October 11 2012, 17:02

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