KAZAKHSTAN: 'THE TENGIZ BRAWL' HIGHLIGHTS UNDERLYING

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SIPDIS

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SIPDIS

DEPT FOR SCA/CEN - O'MARA

E.O. 12958: N/A
TAGS: ECON ENRG ELAB PREL KZ TU
SUBJECT: KAZAKHSTAN: 'THE TENGIZ BRAWL' HIGHLIGHTS UNDERLYING
PROBLEMS


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1. (SBU) Summary: A recent fight between Turkish and Kazakhstani
workers at the Tengiz oilfield involved over 400 people and has
received widespread public attention. Despite isolated press
reports that as many as a dozen Turkish workers were killed during
the fight, our TengizChevroil (TCO) contacts have assured us there
were no fatalities or life-threatening injuries. While reactions
have varied widely, the incident has helped stir Kazakh nationalism
and led many to pose questions about wage inequalities and possible
discrimination against Kazakh laborers. End summary.

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The Fight
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2. (U) On Friday, October 20, a brawl broke out at the Tengiz oil
field in Atyrau oblast between Kazakh and Turkish workers. (Note:
Kazakhstani workers at Tengiz tend to be ethnic Kazakhs. The Tengiz
oil field is operated by Tengizchevroil, a joint venture between
Chevron (50%),ExxonMobil (25%),KazMunaiGaz (20%) and LukArco (5%).
Nearing the end of a labor-intensive expansion phase, the field
currently employees 14,000 workers. End note.) The official
investigation conducted by the procuracy and the National Security
Committee ("KNB") determined that the brawl started with an argument
between a Kazakh worker and two Turkish workers, when the latter
refused to sign the former's work authorization form. According to
the investigation, a heated exchange followed, leading to the two
Turkish workers striking their Kazakh counterpart. Witnessed by a
large number of employees - both Kazakh and Turkish - the incident
quickly grew into a mass brawl. Early reports of fatalities have
been refuted.

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The Aftermath
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3. (SBU) TCO General Director Todd Levy announced on November 2 that
196 individuals had been injured in the fight, including 193 Turks,
two Kazakhs, and one Indian. TCO's Government Relations Director,
Antonio Palmeirim, told Econoff later the same day that the true
number of Kazakhs injured in the melee was not known, as many had
left the site with minor injuries and received treatment at home.
Palmeirim reported that, contrary to the more lurid press reports,
no one had been killed or received a life-threatening injury during
the melee. One Turkish worker, he said, had undergone minor surgery
for a concussion.


4. (SBU) Ted Etchison, Chevron's Deputy Managing Director for the
company's Eurasia Business Unit, called Ambassador Ordway on October
22, seeking an introduction to the Turkish Ambassador in order to
solicit the latter's help in calming Turkish workers and averting a
threatened walk-off of nearly 1000 Turkish contract employees. (At
that time, Etchison estimated that nearly 400 Turks had already left
the field, mostly to seek medical attention.) Etchison reported
later that the Turkish employees, as well as the Turkish Ambassador,
were demanding that security measures at Tengiz be bolstered in
order to avoid similar incidents in the future. Etchison told the
Ambassador that TCO would make every effort to meet the demands.


5. (SBU) Palmeirim reported on October 31 that TCO had successfully
averted a massive walk-off, and that work activities at the field
were gradually returning to normal.
He later spelled out some of the specific security measures that
were being put into place at the field, including the assignment of
nearly 200 Kazakhstani police to the site, the installation of
surveillance cameras and identification checks at working and
accommodation sites, and the temporary segregation of employees in
their living quarters. Palmeirim noted that a new, global security
plan, negotiated by TCO, its contractors, and Atyrau oblast
officials, would soon be implemented.

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Public Reaction
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6. (U) While the Tengiz brawl is not unprecedented, its scale has
attracted a great deal of attention from both politicians and the
media. The remarks of the Turkish Ambassador to Kazakhstan - that
the Turkish workers are "guests" in Kazakhstan, and Kazakhstan,
therefore, bears the responsibility - were perceived negatively by
many Kazakhstani observers. Mazhilis Deputy Nurpeis Makhashev, an
Otan-affiliated representative of a district in the Atyrau oblast
and former president of an oil company, was quoted in the
pro-government "Megapolis" newspaper as blaming unspecified "forces
in the world" that "do not want stability in Muslim countries." The
article goes on to conclude that "what is left to do is find an

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obvious American trace." Opposition "Svoboda Slova", on the other
hand, chose to search for causes of the Tengiz brawl deep within.
The fight, it opined, represents a "revolt of national
consciousness," "a splash of ancestral memory," and a "revival of
the genetic code developed over several centuries" of "glorious
battles defending the Kazakh steppes."


7. (U) The reaction of the government and high-profile officials has
been much more tempered. A spokesman for the Kazakhstani MFA said
in a news conference that the Tengiz incident "was caused by routine
problems," will not harm Kazakhstani-Turkish ties, and "by no means
reflects the spirit and content of the bilateral cooperation between
the brotherly peoples of Kazakhstan and Turkey." Dariga
Nazarbayeva, leader of the Aimak faction in the Parliament, has
called on the Foreign Investors' Council to "take measures for
resolving conflicts at enterprises with foreign participation."
(Note: The Foreign Investors' Council is an advisory body
established in 1998 by Presidential order to promote dialogue
between the GOK and foreign investors. End note.) Nazarbayeva
remarked that the main causes behind the growing trend of conflicts
at foreign-owned enterprises are violations of labor regulations and
worker safety guidelines, lack of attention to social problems, and
a discrepancy between wages of local and foreign workers. She added
that the government needs to pay more attention to preparing more
skilled workers from the midst of the local population.


8. (SBU) Comment: Although the proximate cause of the 'Tengiz
brawl' was a garden-variety fight, the incident highlights
underlying issues. One is Kazakhstan's lack of skilled workers, a
deficit that commonly leads foreign investors to hire a volatile mix
of higher-paid skilled foreigners alongside unskilled Kazakh
laborers. This contributes to a nationalist undercurrent, further
fueled by simmering disaffection over the failure of Kazakhstan's
economic boom to significantly improve the lot of much of its
regional population. The occasional result, as in the case of the
Tengiz brawl, is an outpouring of moderate populist anger against
foreigners perceived to benefit from Kazakhstan's natural riches at
the Kazakhstanis' expense. End comment.

ORDWAY