VZCZCXYZ0000
RR RUEHWEB

DE RUEHEG #1191/01 1621244
ZNR UUUUU ZZH
R 101244Z JUN 08
FM AMEMBASSY CAIRO
TO SECSTATE WASHDC 9513

UNCLAS CAIRO 001191 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: BEXP AMGT ECON EINV ELAB ETRD SENV EAID KPAO EG
SUBJECT: APACHE NOMINEE FOR CORPORATE EXCELLENCE 
 
REF: A. STATE 54208 
 ¶B. STATE 34994 
 
¶1. We would like to nominate Apache Corporation, the largest U.S. 
investor in Egypt and Egypt's third largest oil and gas producer, 
for the State Department's Corporate Excellence award.  In addition 
to achieving business excellence, Apache deserves recognition for 
its girls school program, support for communities in which it works, 
and exemplary employment and environmental policies. 
 
Apache in Egypt 
--------------- 
¶2. Apache, a U.S. firm headquartered in Houston, has been active in 
Egypt since 1994, when they acquired 25 percent interest in the 
Qarun Concession.  In 1996, Apache opened its Cairo office, and then 
further expanded in 2001, when it acquired Repsol YPF's operating 
interest in the Khalda Concession. As of year-end 2007, Apache has 
invited $ 4.2 billion in Egypt, with another $1 billion in 
investment planned in 2008.  Apache has an interest in 14 
concessions and 59 development leases. 
 
¶3. Apache's oil and gas exploration and production activities are 
conducted in partnership with the Egypt General Petroleum 
Corporation (EGPC). In all its dealings with EGPC, suppliers and 
other Egyptian business associates, Apache adheres to the highest 
standards of integrity, transparency and ethical business practices, 
believing that a system based on these standards is most likely to 
provide an open marketplace and encourage additional investment by 
Apache and other foreign companies. 
 
Corporate Social Responsibility 
------------------------------- 
¶4. The company's reputation as one of Egypt's leading corporate 
citizens is based on its strong support for the GirlsQ Education 
Initiative, a program of the National Council for Childhood and 
Motherhood (NCCM) to provide educational opportunities for girls 6 
to 14 years old in rural villages in one room school schoolhouses. 
The one room schools accommodate up to 36 girls and have the aim of 
teaching them to read, reducing the incidence of early marriage, 
educating young girls on health, hygiene and environmental issues 
all via an active learning process coordinated by two teacher 
facilitators from the area.  The ultimate goal is to help the girls 
return to the formal education system; once a student misses a year 
of education, the public school system will no longer accept her. 
 
¶5. In 2004, Apache completed the first prototype one-room school in 
Abu Sir in the Giza governorate. The school was built to last for 50 
years or more and provides a user-friendly environment for modern 
educational techniques. It uses prevailing winds for cooling; 
windows and high ceilings for optimal natural lighting; and sun 
breaks to prevent overheating. 
 
¶6. Apache then founded Springboard Q One-Room Schools for EgyptQs 
Girls, a U.S.-registered NGO, to accept donor funds for the project. 
 Since then, in cooperation with the Apache-formed U.S. NGO 
Springboard -- Educating the Future  -- another 202 schools along 
the Abu Sir prototype have been built in the Fayoum, Minia, Giza and 
Marsa Matruh Governorates.  Apache continues to maintain and support 
these schools under the Egyptian National Council of Childhood and 
Motherhood's program.  Subsequently, Apache and its donors have 
provided additional support by building fences, planting gardens, 
organizing student field trips, and providing basic school supplies, 
clothing, hearing aids/glasses, blankets, and computers.  In 2008, 
Apache acquired 200 laptop computers under the One Laptop per Child 
program as a pilot to eventually provide laptops to all 203 schools 
and their 5000 students. 
 
¶7. Apache also supports the Association for the Protection of the 
Environment (APE), an organization that provides literacy and skills 
training for young women in the Mokattam area of Cairo.  Apache 
formed Nile Weavers, an NGO that assists with purchasing and 
distributing hand crafted products from the poor areas of Egypt to 
Apache employees and other organizations in the USA.  Funds 
generated are returned back to these organizations by additional 
purchases or provisions of other needs. 
 
¶8. In addition to their work with elementary to high school 
students, Apache sponsors various universities in Egypt (Azhar 
University Geosciences Department, Alexandria University 
Geological/Geophysical Department, Fayoum University Early Learning 
Program), as well as local schools for expatriates (Cairo American 
College, Maadi British School).  Apache, working with its Khalda 
Petroleum Company affiliate, funded a special one-year on-the-job 
training program for 25 new petroleum engineering graduates of Cairo 
University.  The program was administered by the Colorado School of 
Mines Petroleum Engineering Department (Golden, Colorado).  Finally, 
Apache supports its staff, who also contribute their time as 
lecturers at Al Azhar University and Alexandria University. 
 
Other community activities 
-------------------------- 
¶9. Apache provides support to other community activities as well. 
For example, Apache routinely provides logistical and financial 
support to the Egyptian Environmental Affairs Agency (EEAA) in their 
campaign to raise public awareness of Egypt's natural environment in 
areas where they operate.  In particular, Apache supported EEAA's 
efforts to have the Whale Valley area in the Wadi Rayan concession 
designated a World Heritage Site.  A number of prehistoric whale 
fossils have been discovered in this area.  In cooperation with 
University of Michigan archeologists, Apache provided financial 
support to ship a fossil to the University of Michigan for 
preservation and mounting.  Once this is done, the fossil will be 
returned to Egypt for display.  Apache Egypt also recently committed 
funds to provide support to the UCLA Fayoum archaeological project 
under the direction of Prof. Willeke Wendrich. 
 
¶10. Apache's other community projects include co-sponsorship of four 
Egyptian athletes to train for seven months at the Dekalb 
International Training Center in Georgia before the 2004 Athens 
Olympics.  The firm provided equipment for the Matruh General 
Hospital.  Apache purchased vehicles and built buildings for Dar El 
Hanan, a home for disabled and orphaned children in Fayoum. 
Finally, in an effort to address Egypt's road safety problems, 
Apache worked with other oil companies to support a road safety 
awareness educational campaign. 
 
Exemplary Employment policies 
----------------------------- 
¶11. Apache's oil and gas operations require a trained, educated 
workforce, and Apache supports training abroad and in-country for 
the Egypt corporate office nationals and the joint venture staff. 
Through its joint venture companies, Apache provides ongoing 
training of Egyptian employees so they can maintain production using 
the latest in industry technologies. As the third-largest oil and 
gas producer in Egypt, Apache directly employs approximately 245 
Egyptian nationals in its corporate activities and indirectly 
employs 3000 EGPC Egyptian nationals through its joint ventures with 
EGPC.  Apache's vendors, suppliers and others doing business with 
Apache are expected to conform to US business standards and 
practices.  Contracts executed require compliance with workers' 
rights regarding rights to organize, child labor restrictions, 
acceptable working conditions and compliance with international 
labor laws regarding timely payment of wages.  Additionally, 
compliance with US Foreign Corrupt Practices Act is mandatory.  In 
all of its activities in Egypt and elsewhere in the world, Apache 
puts a strong emphasis on safe operations. Apache adheres to health, 
safety and environmental standards and policies and encourages local 
employees to follow the same guidelines and practices. 
 
Apache and the environment 
-------------------------- 
¶12. Apache conducts all of its operations in an environmentally 
responsible manner. In each of its concessions, employees monitor 
operations to ensure that discharges are avoided and to assure a 
rapid response to minimize the impact of unintended discharges. 
Many of Apache's exploration and production operations occur in 
areas of the Western Desert of Egypt that are still littered with 
unexploded ordinance (UXO) left over from the WWII battles of the 
North African campaign.  During the course of their work they have 
cleared approximately 500,000 acres of dangerous munitions that are 
still lethal despite being buried for over 60 years. 
 
Supporting Egypt's economic development goals 
--------------------------------------------- 
¶13. Apache is a leader in the application of geosciences technology 
in the search for oil and gas in Egypt.  Apache was the first 
company to routinely use 3D seismic data early in the exploration 
cycle.  Apache's effective use of this technology is one of the 
foundations underlying their notable drilling success.  Apache was 
also the first company in Egypt to employ SeaBed Logging (SBL) in 
the search for hydrocarbons in the deep waters off the Nile Delta. 
This cutting edge technology utilizes electromagnetic waves to 
identify potential hydrocarbon zones that may be undetectable with 
conventional seismic data. 
 
¶14. From data collection and processing through seismic inversion, 
visualization and geologic modeling of complex reservoir systems, 
Apache is constantly evaluating new technologies in an effort to 
reduce drilling risk, enhance safety and provide a better value for 
their shareholders and host government.  Apache is a technical 
leader in the Egyptian petroleum industry, and a leader in the 
introduction of modern oil field production technologies to the 
Western Desert including the first wide-scale application of 
wellbore fracture stimulation methods, beam pumping units, and 
waterflood optimization.  Apache has installed 60 natural gas 
turbine generators to electrify much of its field operations thereby 
displacing the use of hundreds of small diesel-powered generators to 
provide a clean, low-cost power source. 
SCOBEY