eias and the mitigation of the social impact of oil and gas operations

1. EIAs and the Mitigation of the Social Impact of oil and gas Operations 2nd - Expert Meeting on Environmental practices in offshore oil & gas activities

3. Environmental Management Process

4. EIA content Several organizations have published excellent guidelines. Consult the web-site: http://www.worldbank.org/environment

5. Transparency and Participation

6. Social Impact Increasingly, hydrocarbon exploration and development projects are taking place in environmentally and socially fragile areas. There are unsatisfied demands of local populations, specially indigenous peoples, more aware of their property and cultural rights. Time and resources are required to understand these rights.

7. Pressures to respect indigenous rights have developed world-wide The ILO Convention 169 indicates that Governments shall consult to indigenous peoples to develop measures, regional plans and specific projects that could impact them and set up mechanisms for their participation. The Bank Group is reviewing its policy on Indigenous Peoples. NGOs have cumulated a broad field experience and are key players, offering independent monitory capacity.

8. WB -Policy on Indigenous Peoples Under review to: Better define �indigenous peoples� and its representation. Set-up indicators Ensure monitoring The key concept is: �informed participation�

9. Oil industry response The oil industry is way ahead in responding to this challenge. Major international companies are coming up with innovative ways to design, implement and monitor agreements with local communities. These practices should become however more widespread, especially among local firms not yet subject to the same spotlights.

10. Emerging Best Practices There is available case studies and detailed information on emerging best practices extracted from oil operations in the Northern Canadian territories, Papua New Guinea and the High Amazon region. To attempt a presentation of these �best practices�, let�s examine five topics -- to be found at:

11. 1 - Consultation and Participation A wider continuous process of participation of all stakeholders in the decisions throughout the formulation and execution of a project leading to a sustainable development of the local population. Essential part of the EIA. The process should be started by the Government, prior to licensing of the area. It should include precise agreements that could be adapted and monitored throughout the project life.

12. Non-contacted population Companies in frontier areas should prepare appropriate contingency plans. Key aspect: health. The consultation and participation of local communities is essential.

13. 2 - Sharing of Benefits �Compensations� for use of lands, �Indemnification� for losses and damages to property, �A direct share of benefits� from the exploitation of resources. In most countries, indigenous peoples do not own the sub-soil resources. However, national laws recognize a regional participation on the benefits. Delays in land titling are a constraint. Traditional occupancy provides evidence for property rights. The way benefits are distributed is subject of many disputes. Revenues do not arrive to the indigenous communities living close to the operation sites.

14. Sharing of Benefits The way benefits are shared in Papua New Guinea illustrate several issues: cap to 20% of total government take, difficult relations between central government, provinces and traditional landowners. lack of an effective social mapping the need to develop consensus balancing different development objectives.

15. 3 - Governance and Human Rights The Best Practices include the Governments� commitment for improving security in areas of operation, fighting corruption, and a clear respect to human rights. A check-list for developing a company human rights policy should encompass: discriminatory practices related to gender, religion or ethnic groups; fair working conditions, health and safety programs, applied also by contractors and sub-contractors; rights of free association and to collective bargaining; encouragement to community participation activities; independent monitoring procedures.

16. 4 - Improved Environmental and Social Regulations All stakeholders recognized the need to have appropriate �rules of the game� establishing the responsibilities that lie with companies, government agencies and indigenous peoples. Key aspects that should be part of an acceptable legal-regulatory framework are the following:

17. Key aspects to be covered Prior-consultation, Criteria to determine representation rights. Role and responsibilities of government and industry (e.g. health, education). Declaration of protected, intangible areas, of indigenous territories, and of the area impacted by a project. Past environmental liabilities. Procedures for conflicts resolution and consensus building. Methodology to estimate compensations, balancing positive impacts with negative impacts. Indicators for evaluation, control and supervision of companies� management practices related to communities.

18. Efforts to improve regulations have started in Latin America A comparative assessment of regulatory frameworks has provided recommendations to improve the design and -as possible- harmonize environmental and social regulations. The PEA project: (i) information; (ii) training, (iii) improvement of regulations. New activities: (i) line of credit, (ii) no-go areas, (iii) distribution of regional royalties. At the country level, Peru, Bolivia and recently Ecuador have started to develop - by stakeholders� consensus- a regulation for operations in indigenous lands. In Bolivia, a first Bank Loan is under preparation aiming at strengthening the government capacity and training.

19. 5 - Private Social Investments Beyond compensation, companies are implementing Community Relation Plans including components on health, education, infrastructure and sustainable development projects. There are well-recognized practices for the preparation and implementation of sustainable Development Plans that contribute to the protection of social and cultural heritage of indigenous peoples.

20. Issues to consider in Private Social Investments Widest participation of stakeholders in all project phases. Recognition of traditional representative structures. Legitimate stakeholders� expectations early in the process. Unrestricted access to EIAs and information. Allow time for discussion, not only with indigenous peoples but also with regional and local governments willing to coordinate plans. Funding for development plans becomes a category of exploitation costs, recognized and monitored by tax authorities. Nominate Community Relations Advisers(s), and keep top-management well informed. Prepare guidelines for relating with indigenous peoples and disseminate them to sub-contractors. Involve NGOs in the implementation and monitoring.

21. Conclusions Operations in fragile environments need to consider environmental and social impacts in all project phases. Early consultation is of critical importance to avoid social problems. Involvement of Government Agencies, Indigenous Federations and, in general, Civil Society needs to be actively pursued. Allow sufficient time and resources.