| Chevron Mining : Miner Details |
| Energy Executive Spotlight | |||
| Written by John Zorabedian | |||
| Tuesday, 01 April 2008 | |||
 Mark Smith says the reach of Chevron’s global brand has helped this mining company engage workers to develop best practices for safety.
 Mark Smith, President and CEO Chevron’s systematic approach to operational excellence produces results that improve mine safety, even as it increases productivity. “It’s changing the way that we’re looking at the business as miners,” Smith said. “Historically, people looked at mining and said, that’s a dangerous business. We believe it can be a safe business, and we aim to prove that.” In September of last year, Chevron merged its wholly owned subsidiaries The Pittsburg & Midway Coal Mining Co. and Molycorp, Inc. to create Chevron Mining, Inc. The strength of Chevron’s global brand has created a more attractive draw for engineers, geologists, and miners. But with the new brand comes the responsibility of upholding the parent company’s principles of operational excellence, Smith said. “Being able to use the Chevron name means that we have to adhere to what we call the Chevron Way,” he said. “It means we want to do business the right way, engaging stakeholders of all sorts, making sure we give back to the communities.” This means doing things the right way not only at the company’s corporate headquarters in Englewood, Colo., but at the bottom of a mineshaft in North River, Ala. or Questa, NM, or in the surface coal mine in Wyoming. “If you do business the right way, including an extreme focus on safety, you end up with a better business,” Smith said. “It absolutely pays dividends.” Mineral wealth Chevron Mining’s diversified operations include three coal mines, a fourth coal mine the company is developing in Wyoming in partnership with mining company Consol, a rare earth mine in California, and a New Mexico operation for mining molybdenum, or moly, a metal additive required for converting carbon steel into stainless steel. Chevron Mining’s revenues surpassed $500 million in 2007, a figure that is sure to go up if market conditions hold that have sent the price of coal and other commodities soaring due to China’s voracious appetite for steel. Production issues in Australia, where China buys much of its coal, have created a huge opportunity for the American coal industry, Smith said. Although the vast majority of US coal supplies electricity production in the US, the high demand for metallurgical coal for producing steel has made it profitable to ship it around the globe to Europe and other places where Chinese buyers have created a shortage of supply. Even steam coal, used for producing electricity, is reaching unprecedented prices in the spot market. For the moly market, Chevron Mining’s operation in Questa has a resource base that will last more than 50 years at today’s production rates, Smith said. And the cost of moly has risen from about $2 per pound in 2000 to more than $34 per pound today. “It’s a great business to be in because of the very high demand,” he said. Chevron Mining’s other interests include a 33% stake in Japan’s Sumikin Molycorp, which makes a metal powder used in producing high-strength magnets used in hybrid cars, and the Chicago Carbon Company, which makes petroleum coke for the aluminum and titanium dioxide industries. Mitigating risk Chevron Mining’s operational excellence program depends on the engagement of all of its employees, and having each worker assess and recognize risk and ways to minimize accidents. “Success is people and engaging all of the people in the company in everything we do,” Smith said. One of the company’s best tools for mitigating risk has been providing every employee with a small, laminated “Stop Work Authority Card.” These cards tell each employee that they are responsible for their own safety and are authorized to stop work at any time due to unsafe conditions. “I personally sign that as the president of the company,” Smith said. “It also says there will be no retaliation or anything else as a result of them stopping work. We want them to do it safely or not at all.” The US Mine Safety and Health Act has legislated the right of miners to stop work at any time. But by making that right explicit, and part of a larger strategy of minimizing risk, Chevron Mining has empowered the workers in safeguarding their own health and safety. This program is augmented by safety self-assessments and what Smith calls a behavioral-based safety program, in which employees write reports anonymously detailing safety violations or commending a fellow worker for taking the proper steps, providing a tremendous amount of data for analyzing worker behaviors and developing best practices. “That was not an easy thing to get employees to buy into on the front end, because everybody thought this was going to be a tattletale kind of program,” Smith said. What drives these safety programs is workers looking out for themselves and for each other. “These are very simple things that we should have thought of years ago,” Smith said. “But the good news is we did think of them.” |
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American Executive is a RedCoat Publishing publication.
American Executive is a RedCoat Publishing publication.
