Mozambique - Southern Africa Regional Gas Project : environmental assessment (Vol. 2 of 5) : Regional environmental and social assessment

SASOL NATURAL GAS PROJECT Regional Environmental and Social Assessment E784 F I N A L Volume2 July 2003 M A R K WOOD CONSULTANTS 8 -Fl  SASOL NATURAL GAS PROJECT REGIONAL ENVIRONMENTAL AND SOCIAL ASSESSMENT F I N A L July 2003 PREPARED FOR: SASOL TECHNOLOGY (PTY) LTD PREPARED BY: Mark Wood Consultants PO Box 2963, Honeydew 2040 South Africa Tel: +27-11-958-1920 Fax: +27-11-958-1858 Email: markwood@global.co.za Contributing Authors Mr Sean O'Beirne, SE Solutions Mr Johan van der Walt, Acer Africa Mr Mark Wood, Mark Wood Consultants * c-F--- , - A -R'E,!w -  TABLE OF CONTENTS FOREWARD i 1 INTRODUCTION 1 1.1 Background 1 1.1.1 Purpose of this Report 1 1.1.2 Location of the Key Green Fields Elements of the Project 2 1.1.3 Definition of References made to "Sasol" in the RESA 2 1.1.4 Status of Environmental Reporting 5 1.1.5 Status of the Project 10 1.1.6 Disclosure of the RESA 11 2 TERMS OF REFERENCE 12 2.1 Study Approach and Methods 12 2.2 Scope of Work 13 2.3 Report Structure 14 3 ASSESSMENT OF REGIONAL IMPACTS IN MOZAMBIQUE 15 3.1 Effects on Natural Resources 15 3.1.1 Accelerated Hardwood Exploitation 15 3.1.2 Accelerated Wildlife and Other Natural Resource Exploitation 27 3.1.3 Habitat Loss and Ancillary Effects due to Increases in Settlement 32 3.1.4 Pollution Effects Caused by Discharge of Effluent into the Govuro River System 34 3.2 Socio-Economic Effects in Mozambique 41 3.2.1 Upstream and Downstream Economic Growth Opportunities 41 3.2.2 Combined (Cumulative) Effects of the NGP and Other Development on Existing 45 and Institutional Capacity in Southern Mozambique 3.2.3 Impacts on Tourism in and around Vilanculos 51 3.2.4 Impacts on Agricultural Development around the Temane and Pande Production 59 Areas 3.2.5 Impacts on Spatial Development Initiatives in Southern Mozambique 62 3.2.6 Impacts on Safety Restriction Zones around the Pipelines on Settlement 66 3.2.7 Impact of HIV/Aids 69 4 ASSESSMENT OF REGIONAL IMPACTS IN SOUTH AFRICA 70 4.1 Effects on Natural Resources in South Africa 70 4.1.1 Effects on Air Quality 70 4.1.2 Effects on Consumption of Natural Resources 76 4.1.3 Impacts on Job Creation 78 5 REGIONAL POLICY RELATED ISSUES 81 5.1 SADC Policies 81 5.1.1 Mozambique 81 5.1.2 South Africa 82 5.2 Proposed Actions and Responsibilities 83 5.3 Observations for Consideration by Other Parties 83 6 SOCIAL INTERVENTIONS PLANNED BY SASOL 84 6.1 Background 84 6.2 Management Structure to Administer Fund 84 6.3 Community Liaison 85 6.4 Evaluation Procedure for Social Spending in Communities Affected by the 86 Project 6.5 Defining Needs 86 6.6 Project Delivery to Date 87 6.7 Making the Best Use of the Fund 88 6.8 Actions and Responsibilities 89 7 SUMMARY OF CONCLUSIONS AND RECOMMENDED ACTIONS 90 7.1 General 90 7.2 Regional Impacts in Mozambique 90  TABLE OF CONTENTS 7.2.1 Biophysical Environment 90 7.2.2 Social Environment 92 7.3 Regional Impacts in South Africa 93 7.3.1 Biophysical Impacts 93 7.3.2 Social Impacts 94 7.4 Policy Considerations 95 7.5 Summary of Actions and Responsibilities 95 REFERENCES LIST OF FIGURES 1-1 Sasol company structures involved in the NGP 3 1-2 Locality plan 4 1-3 Details ofthe gas field development 5 1-4 Organogram of environmental reports and relevant project related documents 6 prepared during the course of the planning of the Natural Gas Project 1-5 Detailed document map of technical reports for the NGP 8 1-6 Organogram showing environmental teams involved in monitoring and auditing 10 construction of the Mozambique section of the pipeline 3-1 Distribution of Androstachys johnsonii (Lebombo Ironwood) along the proposed 17 pipeline route 3-2 Typical agriculture/woodland mosaic in the study area 18 3-3 Location of permanent infrastructure under construction in Inhambane Province 28 for the first phase of the Sasol Natural Gas Project 3-4 Organogram showing the wastewater treatment logic at the CPF 35 3-5 Seasonal extent of flooding 38 3-6 Extent of agriculture in the Govuro River area 39 3-7 Approximate boundaries of the Corridor Sands and Rio Tinto project exploration 47 license areas 3-8 A Schematic diagram of the process of acquiring land 53 3-9 Schematic diagram of the process to be followed to implement a proposed 54 development in Vilanculos 3-10 Temane CPF construction site: analysis of construction complaints raised by local 56 communities and officials 3-11 Agricultural potential in the exploration area 60 3-12 Area of the Limpopo Valley Spatial Development Initiative 63 3-13 Area of the Maputo Development Corridor 65 3-14 Areas of partial protection around the natural gas pipeline 67 4-1 Comparative emission factors for coal, fuel oil and natural gas expressed as mass 72 emitted (g) per unit of energy (GJ) (sourced from AP42) 4-2 Sectoral breakdown of existing synthesis gas users 73 4-3 Sectoral breakdown of projected future gas users 74 6-1 Responsibility framework for implementation of the SDAP 85 LIST OF TABLES 1-1 Venues at which the EIA Documents and the RESA, the RPIP and the 10 Consolidated Executive Summary and Update have been disclosed to the public 2-1 Issues that have been evaluated in Chapter 5 of the RESA 13 3-1 Data concerning hardwood harvesting in the study area 20 3-2 Summary of information gathered at four sawmills in Inhambane Province 22 3-3 Volumes of the most common woods for which simple licenses are issued in the 24 Districts of Mabote, Vilanculos, Inhassoro and Govuro (period 2003) 3-4 Animal species that will be under greatest pressure as a result of increasing 30 accessibility in the study area 3-5 Limits for process wastewater, domestic sewage and contaminated storm water 36 for discharge to surface waters (Source: World Bank, 1998)  TABLE OF CONTENTS 3-6 Liquid effluents from onshore oil and gas production (Source: World Bank, 1998) 37 3-7 Possible gas users in the Maputo area that will be supplied with gas by the Matola 42 Gas Company 3-8 Employment during construction and operation of the Corridor Sands project 48 compared with the Sasol NGP 3-9 Comparison between existing traffic volumes on the EN-1 and the volumes 49 created by the NGP during operation of the CPF 3-10 Comparison between Mozal (I and 11), Corridor Sands and Sasol NGP 57 employment and investment data 4-1 Changes in air pollutant emissions from various Sasol operations as a result of 70 the change to natural gas 4-2 Air pollution emissions (in kilotonnes) and their sources in South Africa in 1990 73 (after South Africa's SOE, 1998) 4-3 Employee numbers reported in the November 2002 SCI board report 78 4-4 Sigma Colliery contractor figures 79 4-5 Personnel requirements current Sigma vs. Future Mooikraal 80 6-1 Overview of community needs 87 6-2 Existing and future project deliveries to date 88 7-1 Summary of Sasol actions and responsibilities 95 7-2 Summary of observations to be noted by the World Bank for purposes of further 99 discussions with third parties, if applicable and required. LIST OF PHOTOGRAPHS 1-1 Sasol Secunda Plant 7 2-1 Manufacture of charcoal along the pipeline right of way 14 3-1 Examples of ironwood forest 16 3-2 Large areas of ironwood east of the study area 18 3-3 Temporary shelters constructed in Ironwood forests during timber extraction 20 3-4 Use of the construction right of way for hardwood exploitation 25 3-5 Game meat (Cephalophus natalensis - Red Duiker) is an important dietary 29 supplement 3-6 African Python (Python sebae natalensis) by pipeline trenching crew 29 3-7 Typha capensis (Bulrushes) sold to generate extra income 29 3-8 Sale of firewood supplements household income 29 LIST OF BOXES 3-1 Monitoring system for controlling illegal hardwood extraction along access created 26 by the NGP 3-2 Sasol NGP approach to construction employment issues 56 3-3 Record of discussions with key role players in the agricultural sector in 61 Inhambane Province 6-1 Excerpt from Sasol Ltd Social Development Action Plan 84  TABLE OF CONTENTS LIST OF ACRONYMS ARA SUL Southern Regional Water Authority BIP Beluluane Industrial Park BoP Balance of payments CDM Cleaner Development Mechanism CER Carbon emission reductions CIP Centre for Investment Promotion CPF Central Processing Facility DDARD District Director for Agriculture and Rural Development DNCH Direcc3o Nacional de Carv3o e Hidrocarbonetos (National Directorate for Coal and Hydrocarbons) DNFFB National Directorate of Forestry and Wildlife DWAF Department of Water Affairs and Forestry EIA Environmental Impact Assessment EIS Environmental Impact Study EMP Environmental Management Plan EMS Environmental Management System ENH Empressa Nacional de Hidrocarbonetos de Mocambique, E.P. GDP Gross Domestic Product GLTP Greater Limpopo Trans-frontier Park GOM Government of Mozambique GTL Gas to Liquid HIV/AIDS Human Immunodeficiency Virus / Acquired Immune Deficiency Syndrome HSE Health, Safety and Environment IDC Industrial Development Corporation IFC Industrial Finance Corporation IFZ Industrial Free Zone KAPS Knowledge, Attitudes and Practices Survey LDC Limited Duration Contract LPG Liquid Petroleum Gas LVSDI Limpopo Valley Spatial Development Initiative MDC Maputo Development Corridor MGC Matola Gas Company MW Megawatt MGJ Million GigaJoules MICOA Ministry for the Coordination of Environmental Affairs (National Department - Mozambique MIGA Multilateral Investment Guarantee Agency NDEA&T National Department of Environmental Affairs and Tourism NGO Non Government Organisation NGP Natural Gas Project (the current project) PARPA Action Plan for the Reduction of Absolute Poverty PLA Project Labour Agreement PLT Public Liaison Team PM Particulate matter PPZ Partial Protection Zone PWV Pretoria-Witwatersrand-Vereeniging triangle (the heart of the urban and industrial belt of South Africa RESA Regional Environmental and Social Assessment RPIP Resettlement Planning and Implementation Programme ROMPCO The Republic of Mozambique Pipeline Investments Company (Pty) Ltd SADC South African Development Community SCI Sasol Chemical Industries (Pty) Ltd SDAP Social Development Action Plan SDF Social Development Fund SIC Sasol Investment Company SMMEs Small and Medium Enterprises SPFFB Provincial Services of Forestry and Wildlife SPI Sasol Petroleum International (Pty) Ltd  TABLE OF CONTENTS SPM Sasol Petrole'um Mozambique SPT Sasol Petroleum Temane Limitada SSF Sasol Synthetic Fuels (plant situated in Sasolburg) TFCA Trans Frontier Conservation Area TSS Total suspended solids WHO World Health Organisation WWTP Waste water treatment plant  FOREWORD Sasol's commitment to the proposed recommendations contained in the RESA This document is submitted to the World Bank for DurDoses of meetina the financina requirements in accordance with the Safeguard Recommendations issued to Sasol by the World Bank in December 2002. Drafts of this document have been submitted to the World Bank and other stakeholders for input and comments prior to the finalization of the document. Comments have been noted, heeded or otherwise attended to. This document is submitted as a final version for clearance by the World Bank (AFTESj, aisciosure at the infoshop in Washington and for purposes of submission to the World Bank Board for financing approval. Sasol will a!ns rIiac-inea thea rdnoument tf atakeahonelara in Sonuth Africa ad Mnr zArnmhin..a n explained in this document. The document reflects the status of the NGP at the end of June 2003. [ SASOL'S COMMITMENTS TO THE PROPOSED RECOMMENDATIONS CONTAINED IN THE RESA oasoi weicomes mue opportunity to nave parucupated in and to nave made resources avaelaowe for the development of the RESA. Sasol considers the contents of the RESA to provd framewonrke for ani infa.rma$i n acordin., ton uhi,h thea cu mmulafive andn rg,ninna! imnai.4aof tIe Natural Gas Project can be managed. Sasol takes note of the contents of the RESA and the recommendations, findings and observations made In the document. Sasol recognises that the NGP's operations and activities, as well as those of its partners, may have cumulative and regional impacts, as indicated in the RESA. As a responsible global company, operating both locally and internationally through various businew units, Sasoi accepts responsibiiity to manage ihe regional and cumulative impacts directy associated wih the NGP, that are within its control, in irtA r In gn.. nn ihda Irnn ltin emoasi*#ahl ai k nf jih n lae4 ea4mirnnr ife lifai-r4a