The impact of BP’s activities in Papua Barat has been overseen by an independent panel of advisors. Established in early 2002, the Tangguh Independent Advisory Panel (TIAP) was charged with advising BP on how the liquefied natural gas (LNG) project could achieve its potential as a world-class model for responsible development

Even before the project was officially sanctioned and construction began, BP set in place action plans or the communities that would be affected by the future plant. The integrated social programme has seen development efforts concentrated on improving health, education and general living standards, as well as offering support in livelihood and governance.

Results of the social development programme have been reviewed by members of the TIAP, who have visited the LNG site, the surrounding villages and some of Indonesia’s major cities on seven occasions. As part of its brief, the panel met with many Indonesians, including leaders of the directly affected villages, officials from the Regency of Bintuni Bay, along with government ministers and nongovernmental organisations (NGOs) representatives in Jakarta.

They have reported their findings annually and made them available to the general public via the internet. They include a series of recommendations made to BP across areas ranging from security to in-migration. Lord Hannay of Chiswick, a former British diplomat and former ambassador and permanent representative to the United Nations, was among TIAP’s members and talks to BP Magazine about the panel’s role.

What was the primary function of the Tangguh Independent Advisory Panel?

Our main objective was to oversee the socioeconomic and environmental aspects of Tangguh; our role was advisory, not executive. It was completely unprecedented, though, for BP to establish such an independent body from the very start of its project planning. On other occasions, a panel has been set up once a project is already underway, but never at such an early stage.

How did you become involved with the panel?

All the members were assembled by BP and none of us knew each other previously. The company selected a former American senator of great distinction, George Mitchell, to chair the group, along with Sabam Siagian, a former Indonesian ambassador to Australia and former chief editor of the Jakarta Post, Reverend Herman Saud from Jayapura, and myself.

Our first visit together to Indonesia was a voyage of discovery. Access to Bintuni Bay was unbelievably difficult as there was no airstrip. We had to go in by helicopter, but nearly didn’t get out again on schedule, as the weather closed in. Needless to say, it was fantastically arduous compared with the journey there today.

What happened after each of the panel's visits to Papua Barat?

In the following months, we would compile our report and pass it on to the company. We were absolutely determined - and BP accepted - that every word of it should be published. We suggested that publication should only take place when the company was ready to respond to our recommendations, so both documents came out together. Once the report was available, we held events in Washington DC and London for NGOs and others, to explore the contents of the report. That's the pattern we followed since our first visit, with considerable success.

How was TIAP's remit devised?

We had a number of briefings, but both BP and TIAP came to the conclusion that there were half a dozen key issues. Security was the most prominent, followed by factors such as education, health, governance and capacity-building. There was also the question of revenue flows from Tangguh: a clear link needed to be established between the gas being exported, the money going to Indonesia and seeing real results in Papua at the end.

Various issues evolved over the course of seven years, but they remained the same issues at heart. For example, with employment of the local community, the first challenge when building the plant was how to employ enough Papuans with the right skills. Then, as we completed construction, it was about how to demobilise a workforce without causing disturbance, and, finally, there was the matter of how to deal with Papuan recruitment in the operating phase.

Why was security so important for the Tangguh project?

At the outset, there was concern regarding a possible influx of Indonesian armed forces and police into the area to guard the LNG facility, and how they might act. BP wanted to implement a community-based security programme, which had never been tried before. It was far from certain that the Indonesians would accept this method, but after gaining the support of the then coordinating Minister of Political and Security Affairs, Susilo Bambang Yudhoyono, who is now in his second term as the President of Indonesia, along with the police chief in Jayapura, the communitybased concept was implemented. As time went on, the prominence of the security issue as part of our work became less and less, because it was a good news story. The programme has been very successful so far and the panel has overseen its transparency: every payment from BP to local police for running training exercises or other activities has been published.

How has local migration impacted on the Bintuni Bay area?

I don't think the migration story is a bad one. Obviously, this massive project was going to have local consequences as it brought more cash and purchasing power into the area. But the point is, these consequences were kept under strict control and the recruitment process was very well handled. The villages have certainly not been swamped with in-migrants, but there was one small matter which took a while to rectify: some people in the directly affected villages, who had absolute guarantees of employment, were passing these on to inmigrants. That was halted, though.

Now, as a result of the Tangguh project, the small town of Bintuni has doubled in size, with shops opening and the emergence of certain service industries. A local government is now in place, which is creating an infrastructure. I don't think this is a bad thing at all.

What was the reaction of local Papuans to the Tangguh project?

We saw the attitude of locals to the project change a great deal over time. In the beginning, they regarded us, the panel members, as people who they could complain to and then something better would happen. But at our last meeting in December 2008, when we brought all the villagers to Babo, there was hardly a single word of criticism. It was extraordinary. They were saying 'Please, more of the same. It's going well.' These town meetings were very important and had never happened before. The people had never seen an Indonesian official, above the local village chief, let alone a foreigner. They responded extremely well and made some very pertinent points.

Reflecting on the Tangguh project, is there one particular challenge that stands out?

I think the biggest one that remains is the commitment to have Papuans in 100% of the skilled positions, and significant portions of management roles, 20 years after operations begin. It is a huge challenge and if it is accomplished, Tangguh will be a real showcase project for Papuans and Indonesians. It is quite demanding, as it takes time to move people through the education process. But there has been a start with 53 Papuan operators trained at Bontang, one of Indonesia's other LNG centres, and now working at Tangguh.

Does Tangguh set a benchmark for other projects in under-developed parts of the world?

I think it should do, but we'll only really be able to write that story in 30 years' time. So far, the panel's reports reflect a positive story. For example, driving the incidence of chronic malaria down from 23% in 2000 to 2.4% in 2008 is tremendous. The improvement in education standards is also very good news. Local villages have been helped to build jetties and to collect rainwater so they are not drinking from contaminated sources. But there is a long way to run with a 30-year production span, possibly longer if more gas is discovered. It is a case of so far, so good.

Tangguh: Monitoring responsible development