Compass in £1.4b deal with oil giant

Contract caterer Compass finalised a 10-year worldwide deal with oil company ChevronTexaco this week which is believed to be the largest supply deal negotiated in the catering industry.

The agreement, worth $2b (£1.4b), covers catering and facilities management for most of ChevronTexaco's offshore platforms, refineries and offices worldwide.

The first project under the deal is for Compass subsidiary Eurest to expand its current business at the Tengiz oilfield in Kazakhstan, operating four food production units that make more than 10,000 meals a day.

Eurest will also manage building maintenance, transport, cleaning and office services at the Kazakhstan site.

ChevronTexaco has operations in North America, Latin America, Australasia, Middle East, Asia, Europe, Eurasia, and Africa.

The oil company believes it will save at least $20m (£13.8m) a year with Compass handling nearly all of its catering across the world, and reducing the number of food suppliers.

A spokesman for Compass said the group already had purchase agreements in place in most parts of the world, which would help to cut costs.

About 40% of ChevronTexaco's catering is in-house. The takeover period will last up to three years as the current caterers' contracts expire and Eurest steps in.

Helmut Porkert, chief procurement officer of ChevronTexaco, said: "We expect to maintain or enhance quality standards and locally-sourced content while saving at least $20m a year."

Compass chief executive Mike Bailey said the deal significantly strengthened the group's position in the remote and offshore market sectors and reinforced confidence in the group's ability to meet its sales growth target of 6% to 9% for the year.