PAREX believes that social responsibility is a corporate commitment based on values, principles, and good practices discussed with stakeholders with the purpose of creating and sharing benefits.
A Responsible Company
Social investment
Continuous interaction with the community has shown PAREX that the path to investing in communities must start with open channels of communication that help to identify community interests and needs. For this reason, our priority regarding these communities is to provide clear and timely information, and to continuously and collaboratively ensure that programs are executed well.
At PAREX, we believe that dialogue has and always will be an essential path to building trust. This is the reason we operate in areas where communities are beneficiaries of the added value and the benefits created by our Company and our value chain.
In 2016, social investment was COP 5,190 million (USD $1.7 million) to support the implementation and audit of our social programs. Even though this investment was lower than that of 2015 as a result of the economic challenges for the oil sector (leading to the suspension of operations in certain PAREX fields), social investment resources were used for programs that benefited nearly 22,000 individuals and 4,000 families.
Social investment in 2016 was extended to more areas. The first projects were implemented in Arauca based on the needs identified by the Company and stakeholders. In the Middle and Lower Magdalena areas, PAREX has also identified specific needs and use of resources to implement social investment projects during 2017.
Economic development
COP 911 218 131
0
0
Community strengthering
COP 1 213 317 178
0
0
Institucional strengthering
COP 329 196 055
0
0
Development plan support
COP 2 424 630 149
0
0
Culture, recreation and sports
COP 33 464 040
0
0
Capachos Block: A two-way commitment
PAREX aims to build bonds of trust through dialogue and fulfillment of agreements, laying the foundations for starting operations where the company has identified an opportunity. In Arauca, PAREX is committed to sharing the successful experiences gained in other regions to promote local development.
The Capachos Project, developed in partnership with Ecopetrol, has become a new milestone in our track record in Colombia. During the first year of our presence in this eastern region of Colombia, our relationships with authorities and communities became stronger. We have made good progress in finding and hiring local suppliers, which were key steps in making our relationships with stakeholders stronger regarding our operations.
We deepened our knowledge of neighboring rural and ethnic communities by working together with those communities. We created opportunities to foster trustworthy relations to encourage community growth hand in hand with the oil industry. Those opportunities have been supported by a social investment program exceeding COP 800 million (USD $262,210) in projects to improve school and community infrastructure, recondition rural roads, and promote community-driven projects.
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PAREX is a company that has respected the Tame communities, and ever since they first arrived here, they have been willing to listen to the communities as many times as necessary.
”
Alexa Milena Quirife
Secretary of Government and Citizen Coexistence of Tame.
Building trust is a progressive and ongoing enterprise. The cycle of dialogue and agreements to advance this project has involved different players who have been building trust in our stakeholderss across the region. The presence of representatives of the Embassy of Canada and delegates of the national government along with the support provided by territorial and local authorities have made possible to put into action the Capachos Project in an environment that facilitate mutual understanding.
At PAREX, we have ensured to maintain standards in our operations that consider social dynamics. In 2016, as stated by Luis Fernando Ulloa, Advisor for the Territorial Hydrocarbons Strategy of the Ministry of Mines and Energy: “PAREX is a very disciplined company in social and environmental matters, strongly aware of the need to do things well”.
Albeiro Caicedo, Vice President of Asojuntas, adds: “PAREX’ relationships stand out because of their respect not only for the communities located close to their operations, but also for everyone in general. After the first social investment experience, we feel grateful for their contribution to improving certain basic needs”.
The Company has always had one single goal: achieve and advance under the highest principles of respect for the current legal regulations, build transparent relationships, and provide contributions that result in better conditions for community development.
Stories of progress
Better housing, better quality of life
“A home is the foundation to have a good quality of life; it is an improvement that allows people to live better.” This is how Nancy Álvarez explains the Materials Supply for Housing Improvement Project that helped her in 2016. Over the past 20 years, she has lived in the rural district of Platanales in the municipality of San Luis de Palenque. Thanks to the building supplies she received, Nancy improved the housing conditions for herself and her family, expanding the kitchen and bedrooms.
Very close to Nancy’s home, in the rural district of Barquereña, 23 other families worked together to renovate their homes using materials provided by PAREX in the amount of COP 97 million (~ USD $31,793). For Estela Meche, who lives in this rural district, this project has meant more security for her family. She used the materials to build a fence around her house which is located near the main road; a long-term improvement that is possible thanks to the effort made by the community and PAREX.
Home improvement is part of the Development Plan Support program provided by PAREX. This program is similar to other programs implemented by municipal administrations. Projects of this nature are an immediate source of progress and social development for recipients because they have access to a better quality of life and improved housing.
PAREX’ Housing Improvement Plan, part of the Development Plan Support program, was implemented in six blocks in the department of Casanare. In total, 609 families in 20 rural districts benefited from this program.
Drinking water for Buenos Aires Alto
As part of the Development Plan Support program, PAREX have worked together with the Villanueva Town Hall and the Community Action Board of the rural district of Buenos Aires Alto to make their water treatment plant functional. The plant treats water from the local aqueduct, supplying this vital liquid to the homes of 50 families.
This treatment plant makes it possible for these families to have high quality water that has a direct and positive impact on their health, especially for children and the elderly, who are more vulnerable to diseases. Flahuber Arias Buitrago, Secretary of Public Works of Villanueva, describes this project as “the main contribution provided by PAREX in cooperation with the Municipal Administration that benefits a community that was in need of a better aqueduct”.
Alliance for the benefit of the people of Tauramena
PAREX believes that engaging all parties creates better solutions to the social problems that may arise. Together with two other companies from the sector, Geopark and Pacific (currently Frontera Energy Corporation), and the continuous support of the Municipal Town Hall, PAREX has provided the Public Service Company (Empresa de Servicios Publicos) of Tauramena with a garbage compactor vehicle. This contribution addresses a clear need of the municipality for adequate waste collection management.
The manager of Empresa de Servicios Publicos of Tauramena, Omar Morales, highlights this important contribution, as well as the benefit this represents to the community. Waste management has many direct impacts on the health and well-being of individuals.
PAREX and local partners
The value chain at PAREX is essential to the development of the areas where we conduct business. A strong value chain promotes local growth through the creation of small-sized and medium-sized enterprises in various economic activities.
Procurement processes developed by PAREX are based on best practices and the principles of legality, inclusion, and fairness. Based on these principles, the Company approaches the local market to identify ideal suppliers who are aligned with the best practices in industrial safety, environmental sustainability, social responsibility, human rights, and ethical standards implemented at the Company.
In 2016, PAREX demonstrated its commitment to local companies, many of which have grown together with the Company, through the procurement of goods and services for COP 58,595 million (USD $19.2 million), out of which COP 53,278 million (USD $17.4 million) was generated in the department of Casanare.
The procurement of goods and services decreased in 2016 compared to 2015 mainly as a result of fewer activities in certain operating areas.
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PAREX has revitalized the economy in municipalities and rural areas through the procurement of local goods and services. In my community, there is a micro-enterprise run
by a woman that used to slaughter 40 chickens per week, and today she sells up to 400. That is when you realize that it is worth having PAREX supporting local development. We are proud to see local business grow and thrive competitively.”
Carlos Chaparro
Food Supplier, rural district of La Graciela, Aguazul, Casanare.
Local competitive development together with PAREX
Several local companies contribute to PAREX’ operations. This is how, in 2016, we continued to work together with suppliers and contractors boosting sustainable development, employment generation, and
the industry’s best practices.
Motived by sustainable business growth
PAREX’ social responsibility goals, among others, are to add value to all participants of the supply chain, in which regional companies are very important because they have an impact in the local economy and help to create new opportunities in the region.
Lina Ramírez is a manager at Transpetrocar. She proudly reports that the company, which was created six years, is currently positioned among the best petroleum by-product carriers in Casanare.
She explains that working with PAREX has helped the company achieved higher standards: “We started working with PAREX three years ago, and our company has been growing since then. PAREX’ service quality standards are very high and they have helped us detect potential failures and take preventive actions to minimize road, environmental, and personal injury risks”.
Today, Transpetrocar ranks among 15 Colombian companies that achieved the ISO 39001 certification of Road Safety Management System. “It was because of PAREX that Transpetrocar got this certification, which has been obtained only by a few companies in Colombia. This means innovation and safety for our clients,” she says.
Suppliers creating opportunities
By supporting suppliers, PAREX helps to make companies stronger and supports employment generation locally.
Servicusiana is a company that provides crude oil transportation services. For Julieth Rojas, Manager of Servicusiana, company audits have strengthened its market competitiveness: “A few years ago, PAREX invited local freight transportation companies to participate in specific service contracts. We were audited and tasked with projects that improved our work until 2015, when we started to work directly with them”.
In addition, Ms. Rojas enthusiastically says that PAREX was the first company to give them the chance to provide direct services. This opportunity has increased employment generation within the company, which currently has 27 employees.
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PAREX was the first company to believe in us and gave us the opportunity to provide crude oil transportation services. We are a local service provider, and we have strived to meet the high safety and quality standards required by the company.
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Julieth Rojas
Servicusiana Manager, Tauramena, Casanare.
Suppliers creating opportunities
Ferreléctricos 2000 and Cocmoelec, companies located in Casanare that provide construction of minor civil works and electrical assembly services, are also suppliers that have grown because of their work with PAREX.
José Peñaloza, Manager of Ferreléctricos 2000, says that because of the opportunity provided by PAREX, they were able to obtain contracts with large companies and expand their business services to the rural district of La Urama, where they currently have a new point of service.
PAREX was the first company to believe in us and gave us the opportunity to provide crude oil transportation services. We are a local service provider, and we have strived to meet the high safety and quality standards required by the company.
In addition, Arnulfo Espitia, Manager of Cocmoelec, says that PAREX was the incentive for their incorporation as a company: “When PAREX came here to present the Kananaskis and Carmentea projects, we were told that there would be opportunities for us if we were a company. This motivated us to incorporate our company to become PAREX’ direct contractors”. For Arnulfo, formalizing the company did not only mean becoming engaged in different PAREX’ projects, but also meant generating employment and drawing up plans to strengthen its services with the aim of being more competitive in the market.
Requests, complaints, and claims regarding community services
Corporate responsibility involves setting up communication channels for continuous dialogue with stakeholders. For this reason, we have developed a mechanism to appropriately receive, classify, understand, and manage requests, complaints, and claims in a timely manner.
PAREX has a standard protocol for requests, complaints, and claims. Requests are submitted to social managers and, on occasion, to other officers of the Company. These requests are then sent to the Bogota offices for processing, so that a timely response can be provided.
The total number of requests, complaints, and claims decreased by 28% in 2016. There were 347 requests, complaints, and claims recorded in 2015 and 250 in 2016. Many of them (25%) were related to contractors.
Also, by the end of December 2016, 235 out of 250 requests, complaints and claims were resolved and filed, demonstrating our commitment to proper management. It is our goal to reduce response time for requests, complaints, and claims.
Even though they are the main reason for using this communication channel, requests, complaints, and claims relating to contractors decreased by 12% compared to 2015 because of the corrective measures implemented in 2015.
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There is good communication between the Company and us. Whenever I have a question, I can personally talk to the social managers to try to find a solution together
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Adelaida Medina
Community Leader of the rural district of Santa Helena de Upia, Villanueva, Casanare.
Petitions/Various topics (29%)
Related to contractors (25%)
Petitions/Job opportunity (9%)
Health/Safety/Enviroment/Quality (HSEQ) (9%)
Goods and service topics (9%)
Land owners (8%)
Deterioration/Road maintenance (5%)
Derechos de petición (Petition for Legal Fulfillment of Rights)(4%)
Saliries/Settlements/Service contracts (2%)
PAREX Plan Padrino: A true commitment
PAREX aims to build a bond between its employees and communities through a life-changing initiative with a family that lives near the Company’s operating area. In 2016, PAREX Plan Padrino reached out to the Beltrans’ home in Villanueva, Casanare.
Since 2011, PAREX employees and contractors have come together to make the dream of a family living in extreme poverty come true: to have their own home and improve their living conditions. Every year, PAREX Plan Padrino gives a house to a family who already owns the land, but does not have the means to build and furnish their house. In 2016, this program engaged our employees from Colombia and Canada, contractors and friends who volunteered their time, work and provided financial contribution over three months. These volunteers helped make single mother Enriqueta Beltran, her four children, and her grandson achieve their dream of having a home in Villanueva, Casanare.
On March 8, 2017, Enriqueta received the keys to her new home as an acknowledgement of her continuous effort over 20 years as the primary income earner: a house with comfortable rooms and the necessary items for the family’s comfort. This is a dream come true that allows this family to set bigger goals and, more importantly, to learn that goals can be achieved.
“The change for me and my children has been huge. PAREX has given us something we never thought we could have,” says Enriqueta as she receives the keys of her new home thanks to the PAREX Plan Padrino. From a fund of COP 67 million (USD $21,960), contributed by PAREX’ employees and some contractors, Enriqueta and her family were provided with a house and a fully-equipped business establishment for a family business: “Sueños y Estilos Dylan” Hairdressing Salon. The business is named after the youngest of the family and is a symbol of a better future for the Beltrans. This micro-enterprise is managed by Omar and Nalleli, Enriqueta’s son and daughter, who received skills training financed by donations.
For Sandra Tarazona, CSR Professional and Head of the 2016 PAREX Plan Padrino: “Being part of this project has been a good lesson and has given me personal satisfaction; it´s a way to pay forward for the opportunities that I have had in my life. This is the result of working together to help improve the quality of life and welfare of a family, in this case, the Beltrans.”
Thanks to the engagement of supportive contractors committed to this program, the initial scope of the plan was expanded by providing this family with a business project to support their progress. These contractors serve as an example for these communities.
Through our Plan Padrino, we will continue to be committed to encouraging volunteer work among our employees and to working on fulfilling dreams and hopes for other families in the areas where we conduct our business.
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PAREX Plan Padrino shows that our Company, like communities in which we conduct business, are made of people who share the same values. Together we can deliver solid results. Our employees, beyond donating a house, contribute to improving the quality of life of a family in need.
”
Lee DiStefano
President of PAREX RESOURCES Colombia LTD. Sucursal
Boosting development for families in Los Llanos
Building spaces where the community can bond and build closer relationships has always been a priority at PAREX. Community spaces benefit the community as a whole. In 2016, we worked with mothers in Santa Helena de Upia, where now there is a community center for their children.
Santa Helena de Upia is a village located in the municipality of Villanueva in Casanare. Even though the presence of 58 families makes this zone of eastern Llanos look almost urban, Santa Helena did not have a space where young children who are not attending school yet could gather and play.
After identifying this specific need, villagers, the Communal Action Board, and PAREX joined forces in 2015 to plan and build a community centre. Villagers volunteered their time and labour and we contributed materials and other resources to build this community project.
By working together, we made the centre a reality in August 2016. Since then, every afternoon, a group of mothers comes with their children to pass the time together and participate in different activities.
This community centre has all the necessary resources for recreational and welfare-related activities for early childhood. Besides being a practical building, this centre is a meeting point where moms and their young children can learn, play, and explore the surroundings the little ones are beginning to discover.
Claudia, Inés, and Maria del Pilar are among the mothers from this region who have benefited over the past few months from this community centre. This place offers them an opportunity to receive support raising their children. They share information about the proper infant care and nutrition in early childhood.
PAREX contributed over COP 70 million (USD $22,943) in the construction of this community centre in Santa Helena de Upia. In 2016, PAREX’ contributions toward community strengthening, as well as to culture, recreation, and sports benefited over 9,000 individuals for a total of COP 1,200 million (USD $393,316).
For Adelaida Medina, a community leader in Santa Helena de Upia, “Having this community centre primarily for children is such a great help. The youngest kids, who do not yet go to school, can go there with their mothers and share experiences”.
PAREX participated as a funding partner during the first phase of construction of the centre. Later on, PAREX provided support for the improvements required for childcare and donated supplies such as chairs, tables, boards, fans, technological devices and teaching materials.
PAREX recognizes the benefits of social investments that serve the entire community. For this reason, a community strengthening program is fundamental to the Company’s strategic plan. With this type of investment, communities may leverage multiple capabilities that may promote social development and improve the quality of life.