' Montgomery Robert 'I ROBERTM@ia db org To 'J'ames Mahoney@exim gov ' James Mahoney@exim gov c Subject FW 'Input for July 23 Camisea with IDB management 07 23 2003 09 07 AM 'I Jim Please note the below email that was sent by BIC to som of our Executive Directors As you may be aware the IDB has not accepted·the URS report on the Upstream Component that was contracted by the IDB ' Bob -----Origin µ Message----From Amy Gray Greetings Attached please find a memo providing excerpts from IDB documents issued on the Camisea project and from the Environmental and Social Assessment of the Camisea Upstream Project prepared by URS I want to clarify in advance that ilie URS report is currently in the public domain and specifically in the possession ofNqOs the press and members ofUS Congress It is my hope that those of you attending the meeting to be held tomorrow at 3PM with IDB management will use the opportun ity to raise questions concerning the information crepancies between these documents and to gain more clarity from IDB management as to specific actions to manage various impacts many of which are not even mentioned in theESIR I hope this information is helpful to you in making your determination regarding IDB financing of the Camisea project Sincerely Amy Gray Director Latin America Program Bank Information Center 733 15th St NW #1126 Wa_shington DC 20005 I • lu 202 624-0624 1 amy@bicusa org mailto amy@bicusa org www bicusa org http www bicusa org I I questions on Camisea for IDB mgmt doc 'I · questions on Camisea for IDF I mgmt doc questions on Camisea for IDB mgmt doc In June 2003 civil society organizations from Peru and the US requested that IDB · President Iglesias delay the IDB's consideration of the Camisea project until several 1 ' 'recommend1 1ti0Iis can be fully implemented various studies currently un erway are concluded and the results of these studies can be considered by decision makers The IDB's written response identified members of the IDB's Board of Directors as those who can decide whether to delay the vote on this controversial project This memo comes as an urgent request to IDB Executive Directors to request up to three months delay ori this vote as authorized by the Eighth Replenishment http www iadb org exr eight ch6e htm ReGently NGOs have received a copy of the Environmental nd· Social Assessment of the Cami sea Upstream Project in Peru prepared by URS of Wayne New Jersey a consulting firm which both IDB and Ex-Im contracted Revi wing the URS study and IDB documents on the Camisea project including the ESIR NGOs have found striking omissions and over implifications of the information URS provided to IDB management and the information IDB management is providing to IDB Executive Directors · The dis repancies between the information in the URS report and the IDB's ESlR provide yet another compelling reason to delay the vote on this project until these discrepancies can be resolved This memo addresses t_hree pressing matters impacts on indigenous people living inside and outside the Kugapak ori reserve erosion and site selection for the fractionation plant at Paracas The first two issues are explored by way of a dialogue between excerpts from IDB documents and excerpts from the URS study whereas the Paracas issue is e pressed solely through excerpts from the URS study in an effort to facilitate reading ESIR IDB text is in black and URS text is in blue It is our hope that IDB Executive Directors and their interested staff will ask IDB management to respond to the info rmation gleaned from the URS study and to fully clarify the a tions the IDB will undertake to respond fully and appropriately to the information contained in the URS study We also urge Executive Dfrectors to request that ID management provide you with the URS study to review it in its entirety prior to deciding on project financing Indigenous People • The ESIR suggest s requiring GoP to improve health services and health monitoring efforts tn the lower Urubamba region while citing the lack of previous syst'ematic·health information on communities in the area • I I The URS study cites • 4-14- 4-15 Regarding deaths of 9 ·children potentially caused py PlusPetrol such con erns raised by Amazon Watch and oth rs are termed reasonable but our analysis and evaluation· prevent us from making statements as conclu·sive as Amazon Watch It is our understanding that the Public Health Ministry is going to start i_nvestigation about this case • 4-13 4 1 3 Identification oflmpacts Block 88 Nativ Communities The direct and indirect cultural social and economic impact of the Camisea Project can be summarized by the following c a negative impact on the resources of hunters given that many animals have migrated away to sites distant from the noise generated by helicopters It is uncertain if such animals will return to their natural habitats after the construction of he Project is completed d a similarly-negative impact on the resources offisliermen e health impacts and spread of non-indigenous r iseases • There is no mention in the ESIR of compensation for involuntary displacement of isolated indigenous groups indeed there is a complete lack of acknowledgement of the reported displacement problem in the Reserve The URS stuqy cites • 3-8 Ther has been a progressive displacement of the indigenous communities Exploitation of resources demand for labor ·and the construction of new access have resulted in forced contact causing the Machiguenga and other groups to move to remaining inaccessible areas to assure their existence • 6-2 Pluspetrol policies toward people living in voluntary isolation require enhancement based on lessons learned during the seismic exploration • 4-11 Indigenous tribe that practice hunter-gather lifestyles generally live in harmony with the other species inhabiting large expanses offorest they are sustainable This appears to be the situation in much of the Kugapakori reserve in the eastern portion of Block 88 where Nanti and Nahua people exist in semii olation The flowline ROW access road and the temporary Camisea River bridge con truction has created the potential for increased access • 4-2 Noise from helicopters and movement of seismic crews through the forest and seismic activities probably had pervasive but temporary impacts on the I ' movements of indigenous people and wildlife species during project operations Long-term impacts of noise on wildlife are difficult to judge because there had Hot b een ·a sufficient baseline monitoring of the area · Questions on Indigenous Peoples' issues to be posed to IDB Management 1 Given that GoP has no baseline data on health of communities in the area why wouldn't IDB want to wait to review the Public H alth Ministry's investigation prior to considering financing for this project 2 The lack of data indicates GoP negligence at worst or ignorance at best of the general well-being of these communities Given that the ESIR provides no bindirtg instrument for the IDB to ensure the GoP implements the suggested requirements · upon what basis are IDB Executive Directors to have cmnfidence that the political will to implement the suggested actions exists -3 Can IDB management guarantee that there will not be massive mortality of indigenous peoples inside the reserve as a result of this project How will the IDB know that such mortality is not occurring Why hasn't the IDB agreed to establish a full-time monitor in Block 88 to continuously monitor impacts inside the · · Reserve 4 Why hasn't an independent international _expert on indigenous health and livelihoods issues such as the UN Special Rapporteur on Indigenous Rights been requested and given time to assess the potential impacts of this project as has been requested by civil society organizations in Peru s · Why h_asn't the IDB allow d time for the London School of Tropical Medicine's forthcoming report on health impacts inside the reserve to be released and evaluated in developing conditions for this project as has been requested by civil society organizations in Peru 6 Please explain how IDB can finance this project and be in compliance with its involuntary resettlement policy specifically the requirements that 1 no indigenous groups relocate their livelihoods as a result of past project activities or will need to do so in the future or 2 to the extent that some groups relocate they are at least as well off as they would be without the project Erosion • The ESJR's only acknowledgei nent of the settler inc_ursion problem is that an offshore-inland approach was used to minimize construction of access roads ESIR specifically states that no access roads from populated areas were constructed in Block 88 section 6 4 However the URS study cautions that I I •• 4-9 The ROW along flowline corridor b w the well pads and Las Malvinas will provide easy access to primary rain forest and indigenous reserves by hunters l6gg rs a·nd illegal settlers Direct losses of primary forest at well sites Las Malvinas Camp flowline ROW and service roads development locations 1 within Block 88 • According to ESIR Complete revegetation of the ROW is expected to occur except for a 5-8 meter wide permanent ROW 'Yhich will be covered by low growth vegetation to allow for inspections maintenance section 6 93 An erosion control plan has theoretically already' been implemented during preparation of the ROW for the first rainy season of the construction period Dec 02-March 03 section 6 75 URS's assessment however says • 5-2 Piuspetrol has not yet implemented such programs to mitigate and monitor long-term impacts of the project • The ESIR further reports that The pipelines will be entirely buried additional pipeline safety will be ensured by closing the pipeline ROW section 6 13 There is no me1 1tion of the danger of exposed pipelines through permanent erosion damages The URS study cites • 4-3 In spite of engineered erosion control efforts massive areas of soil erosion have developed In places the erosion control is so extensive that portions of the ROW have eroded away exposing flowlines and the diesel line Such ineffective mitigation measures greatly increase the likelihood of a rupture during the operation phase of the project • 4-4 In the event of heavy rains which are common in the region failure of buried flowlines and diesel line along these ROWs is a distinct possibility that would cause substantial secondary impacts • No mention is made in the ESIR of permanent irreparable erosion damage The URS study makes clear mention of the irreversible nature of much of the erosion that has already occurred o 6-3 Erosion of soil into stream channels and the Camisea River has caused and will continue to cause significant indirect impacts on these aquatic ecosystems These effects can be considered irreversiJ le over the span of the next several decades • T ere is no mention in ESIR of secondary impacts being felt because of erosion that has already occurred including silting of rivers and resulting impacts on fish populations The URS study addresses·these issues in • 4-4 to 4-5 °'Masshie regrading is equired ' i n the event of heavy rains which are common in th region failure of buried flowlines and diesel line along these ROWs is a dist nct possibility that could cause substantial secondary impacts The E tA did not adequately characterize the adverse impacts which would likely include decre_ased fish populaiions because of reduced food supply and burial of spawning areas nd decreased fish availability to indigenous communities Communities living along the Urubamba River e g Kirigueti Camisea have raised concerns regarding loss offish and speed oats The ESIR does not address cumulative impacts of opening the area to further exploration and extraction The URS study acknowledges • 4-12 In addition to the combined impacts of the upstr am and downstream projects cumulative impacts or related developments in t e region should be considered Additional oil gas concessions are being considered in the region and arrangements to harvest timber over forest tracts under current protection are also in the process Thus the ROW corridor unless access is restricted would not only' pro ide ah ffective migration corridor for human settlers but also provide an active barrier fragmenting wildlife populations on either side of this route the gas pipeline is being J uilt to accommodate a greater flow than will be generated through solely the exploitation of the Camisea gas fields Questions on Erosion 1 How does IDB management account for the discrepancy between the erosion control problems outlined in DRS ' study and the portrayal of erosion problems in the ESIR 2 How does IDB plan to address possible permanent erosion damages along the ROW 3 How does IDB intend to en sure that TGP Pluspetrol carry out erosion control efforts in a sufficiently timely fashion · 4 Please explain why neither the ESIR nor the project EIA address cumulati1 e impacts that pmst be taken into account in facilitating further extraction given that the gas pipeline is being built to accommodate a greater flow than will be generated through solely the exploitation of the Cami sea gas fields Additional quotes of concern from the URS study • 4 12 In summary there are multiple risks to biodiversity associated with the overall project stemming largely from development access corridors and the intentional or unintentional introduction of new settlements extraction activities organisms and technologies I ' •1 1 6-3 The evaluations of ecological impacts provided in project documents do not adequately meet accepted international standards ofpractice for the asse$Smimt ofproject impacts Synthesis of secondary and cumulative impacts· on biodiversity is not adequate and important 'issues e g secondary impacts endangered species are treated supe jicially or not at all Any lesser · neasures will inexorably lead to irreversible effects on ecological resources and irretrievable losses of biodiversity I Siting of Fractionation plant in Paracas Thi information in the ESIR and in the URS study are so incomp atible this section solely contains excerpts from the URS study We urge Executive Director to ask management to clarify how it is that the recently released URS report contra diets most of the important iss es in the draft ESIR • 6-4 and 6-7 URS also has specific concerns for the development of the Fractionation Plant and Export Terminal at Loberia Beach Generally these concerns fall under Alternatives Evaluation Land Purchase Adequacy oqhe EIA and Public Consultation Most significant items of concern include 1 Site Selection and Alternatives Evaluation Absence of Appropriate social and environmental analysis and potential impact evaluation risk analysis during site selection Absence of community involvement or input in site selection and communication during gathering stages 2 Land Use and Property Purchase Timing of property purchase and land use change to industrial use at Playa Loberia and purchase of just the right of way for the pipeline on the coastal side of the Pisco-Paracas Highway Additional property purchase at Playa Clarita by Hunt Oil • 4-29 URS understands that the land at the proposed site was purchased shortly after the 5 alternative sites were identified in advance of the full alternatives evaluation The timing of this purchase and the method by which a change in land use designation was obtained and lack of complete stakeholder participation are of concern 3 EIA Adequacy Insufficient impact analysis particularly indirect performed in the EIA Inadequacies leave the project less prepared to prevent mitigate and restore conditions from construction and operation of the plant Pownplay of potential impacts to the marine and social environment during construction and operation Sufficient baseline analysis was not conducted Fisheries direct and indirect impacts were rarely and not I quantitatively defiped Resulting economic impacts from fisheries impacts the livelihood of this community were not mentione in the EIA The EIA shoV s a 1-ack of understanding of noise on the marine environment -4 Public Consultation The lack of appropriate and sµf ficient commu'nication with the surrounding communities and identification of appropriate stakeholders on site selection The communities and Reserve bio logists interviewed by URS indicate they are FRIGHTENED concerned or HOSTILE toward· another industry placed on this coast-they believe as the Reserve Biologists do that the site can be placed elsewhere Insufficient identification and accounting of community concerns of plant and terminal construction mostly in part due to the lack of appropriate and sufficient 1 disclosure on the project · In summary the revised EIA was insufficient Thus URS concludes that there does not exist sufficient environmental and social justification for the proposed location of the Fractionation Plant and Export Terminal I • ' ' 6-10 Recommendations PlusPetrol should explore a ditional options available for locating the Fractionation Plant also recommends a more complete analysis of the baseline environmental and social conditions potential direct and indirect impacts and benefits Questions ' I• I How is it that IDB is satisfied that an appropriate level of community consultation that took place in site selection process for Paracas when in fact URS reports the opposite 2 How is it that the recently i -eleased URS report contradicts most of the important issues in the draft ESIR 3 How is that IDB is comfortable in leaving the proposed fractionation plant in the buffer zone of Paracas when URS specifically recommends that Pluspetrol should explore additional options available for locating the fractionation Plant also recommends a more complete ana ysis of the baseline environmental and social co ditions potential direct and indirect impacts and benefits 11