SEMR: Indonesia: Tangguh Liquefied Natural Gas Project

Environmental and Social Monitoring Report # 1 Annual Report February 2012

INO: Tangguh Liquified Natural Gas Project Prepared by Mott MacDonald (External Panel II for Environmental and Social Monitoring) for BP Berau Ltd. / Tangguh LNG and Financing Parties including the Asian Development Bank.

This environmental and social monitoring report is a document of the borrower. The views expressed herein do not necessarily represent those of ADB's Board of Directors, Management, or staff, and may be preliminary in nature.

Tangguh LNG ProjectE&S External Panel II

1st Operational Compliance Monitoring Report

February 2012BP Berau - Project Financiers

301802 PWR GEV 01

27th Februar

D

y 2012

Tangguh LNG Project E&S External Panel II

1st Operational Compliance Monitoring Report

February 2012

BP Berau - Project Financiers

Mott MacDonald, S Widjojo Centre, 3rd Floor, Jalan Jenderal Sudirman Kav.71, Jakarta, 12190, Indonesia T +62 21 252 6588 F +62 21 252 6592, W www.mottmac.com

Tangguh LNG Project E&S External Panel II (2011-2016)

Issue and revision record

Revision Date Originator Checker Approver Description A 19.11.11 T. Streather

B. Cornet M. Rowan

L. Chapman D. Boyland Draft for client comment

B 31.01.12 T. Streather B. Cornet M. Rowan

L. Chapman L. Chapman Re-draft following BP / Lender comments

C 22.02.12 T. Streather B. Cornet M. Rowan

L. Chapman L. Chapman Final report

D 23.02.12 T. Streather L. Chapman L. Chapman Final report to address minor comments on Rev C.

E 27.02.12 T. Streather L. Chapman L. Chapman Final report to address minor comments on Rev D.

This document is issued for the party which commissioned it and for specific purposes connected with the above-captioned project only. It should not be relied upon by any other party or used for any other purpose.

We accept no responsibility for the consequences of this document being relied upon by any other party, or being used for any other purpose, or containing any error or omission which is due to an error or omission in data supplied to us by other parties

This document contains confidential information and proprietary intellectual property. It should not be shown to other parties without consent from us and from the party which commissioned it.

Mott MacDonald, S Widjojo Centre, 3rd Floor, Jalan Jenderal Sudirman Kav.71, Jakarta, 12190, Indonesia T +62 21 252 6588 F +62 21 252 6592, W www.mottmac.com


Content

Chapter Title Page

Acronyms & Abbreviations i

Executive Summary iii

1. Introduction 11.1 Overview __________________________________________________________________________ 11.2 Tangguh E&S Project Background ______________________________________________________ 11.3 Scope of EPII Operational Monitoring ____________________________________________________ 21.3.1 Overview __________________________________________________________________________ 21.3.2 Assessing Compliance with Project Requirements __________________________________________ 21.3.3 EPII Role __________________________________________________________________________ 31.3.4 EPII Activities and Team Composition____________________________________________________ 31.3.5 Scope of EPII First Annual Monitoring Audit _______________________________________________ 41.4 EPII Compliance Monitoring Approach and Activities ________________________________________ 41.4.1 Overview __________________________________________________________________________ 41.4.2 Project and Community Locations Visited _________________________________________________ 51.4.3 Documents / Data Reviewed ___________________________________________________________ 51.4.4 Stakeholders Consulted_______________________________________________________________ 61.5 Limitations _________________________________________________________________________ 61.6 Structure of Report___________________________________________________________________ 6

2. Review of Monitoring & Reporting 82.1 Overview __________________________________________________________________________ 82.2 Environmental Monitoring and Reporting__________________________________________________ 82.2.1 Environmental Monitoring and Reporting Requirements ______________________________________ 82.2.2 Review of Environmental Monitoring and Reporting Activities _________________________________ 82.2.2.1 Overview __________________________________________________________________________ 82.2.2.2 Environmental Monitoring Scope and Reporting Issues ______________________________________ 82.2.2.3 Reliability of Continuous Emissions Monitoring System (CEMS) _______________________________ 92.2.2.4 Detection Limit of Some Equipment______________________________________________________ 92.2.2.5 Monitoring Outside the Site ____________________________________________________________ 92.2.3 Review of Environmental Survey Completion ______________________________________________ 92.2.3.1 Overview __________________________________________________________________________ 92.2.3.2 Fugitive Emissions Reduction Program__________________________________________________ 102.2.3.3 Marine Mammals and Reptiles Studies and Action Planning _________________________________ 102.2.4 Environmental Monitoring and Reporting Recommendations _________________________________ 112.3 IPSI Monitoring and Reporting_________________________________________________________ 122.3.1 IPSI Monitoring and Reporting Requirements _____________________________________________ 122.3.2 Review of IPSI Monitoring and Reporting Activities_________________________________________ 132.3.2.1 Overview _________________________________________________________________________ 132.3.2.2 Internal Monthly Tracking and Reporting_________________________________________________ 142.3.2.3 Reporting Improvement Measures______________________________________________________ 142.3.2.4 Community Grievance Mechanism _____________________________________________________ 142.3.3 Review of IPSI Monitoring and Reporting Findings _________________________________________ 152.3.4 Review of ISP Revisions in Accordance with the IPDF ______________________________________ 15

301802/PWR/GEV/01/D 27th February 2012


3. LARAP Close-out Review 20 3.1 Overview _________________________________________________________________________ 203.2 Outstanding Issues from EP1 LARAP Close Out Review ____________________________________ 203.3 Findings of EPII LARAP Close Out Review_______________________________________________ 213.4 Conclusions of EPII LARAP Close Out Review____________________________________________ 21

4. Non-Compliance (NC) Assessment 26 4.1 Overview _________________________________________________________________________ 264.2 Approach to Non-Compliance (NC) Assessment___________________________________________ 264.3 Non Compliance Assessment Findings __________________________________________________ 274.3.1 Overview of Findings ________________________________________________________________ 274.3.2 Level 1 Non Compliances (NC1) & Recommended Corrective Actions (CA) _____________________ 284.3.2.1 Overview _________________________________________________________________________ 284.3.2.2 Wastewater Discharge_______________________________________________________________ 284.3.2.3 Environmental Monitoring Exceedance __________________________________________________ 284.3.2.4 Sediment Monitoring ________________________________________________________________ 294.3.2.5 Flora and Fauna Surveys_____________________________________________________________ 304.3.2.6 Community Grievance Mechanism _____________________________________________________ 30

5. Additional Improvement Areas & Recommendations 32 5.1 Overview of Improvement Areas and Recommendations ____________________________________ 325.2 Environmental Areas for Improvement and Recommendations _______________________________ 355.2.1 Introduction _______________________________________________________________________ 355.2.2 Key Environmental Areas for Improvement _______________________________________________ 355.2.2.1 Flaring ___________________________________________________________________________ 355.2.3 Other Environmental Improvement Areas and Issues _______________________________________ 365.2.3.1 Introduction _______________________________________________________________________ 365.2.3.2 Burma Creek Drainage ______________________________________________________________ 365.2.3.3 Perimeter Fence and Foreshore _______________________________________________________ 375.2.3.4 Ash from non-hazardous waste incinerator _______________________________________________ 375.2.3.5 Non Hazardous Waste Landfill Leachate_________________________________________________ 375.2.3.6 Condensate Tank Bund ______________________________________________________________ 375.2.3.7 Waste Incinerator___________________________________________________________________ 385.2.3.8 Composter Emissions _______________________________________________________________ 385.2.3.9 Organic Landfill Emissions____________________________________________________________ 385.2.3.10 Housekeeping _____________________________________________________________________ 385.2.3.11 Laboratory Space___________________________________________________________________ 385.2.3.12 Diesel Generators at Contractor’s Camp_________________________________________________ 385.2.3.13 Tanah Merah Baru (TMB) Tar Spill _____________________________________________________ 395.2.3.14 Tanah Merah Baru (TMB) Portacabin Removal____________________________________________ 395.3 IPSI Areas for Improvement___________________________________________________________ 395.3.1 Overview _________________________________________________________________________ 395.3.2 Key IPSI Areas for Improvement _______________________________________________________ 395.3.2.1 Indigenous Peoples Cemetery Access __________________________________________________ 395.3.3 Other IPSI Risks and Issues __________________________________________________________ 405.3.3.1 Manggosa Pathway Electricity Pole Hazard and breach of Site Security ________________________ 405.3.3.2 Agriculture Programme ______________________________________________________________ 415.3.3.3 Teacher Motivation and Retention ______________________________________________________ 41



5.3.3.4 Dependency_______________________________________________________________________ 415.3.3.5 Onar Baru (OB) and Onar Lama (OL) Livelihoods__________________________________________ 435.3.3.6 Reporting Back to the Communities ____________________________________________________ 43

6. Concluding Comments 44

Appendices 45Appendix A. Applicable ADB and JBIC Policies and the Equator Principles ________________________________ 46Appendix B. Key Documents Reviewed____________________________________________________________ 48Appendix C. Stakeholders Consulted______________________________________________________________ 51



Acronyms & Abbreviations Acronym Description

ADB Asian Development Bank

AGI Acid Gas Incinerator

BC British Council (BP’s main Education Programme partner)

BOD Biological Oxygen Demand

CA Corrective Action

CAPs Community Action Plans

C&EA Communications & External Affairs

CEMS Continuous Emissions Monitoring System

CFO Community Financial Officer

CFR Case Fatality Rate

Co-op Cooperative

DAV Directly Affected Villages

DF Dimaga Foundation

EMP |Environmental Management Plan

EMS Environmental Management System

EP External Panel

E&S Environmental and Social

GoI Government of Indonesia

Gvt. Government

IAV Indirectly Affected Villages

ICBS Integrated Community Based Security

IPSI Indigenous Peoples and Social Issues

ISO International Standards Organisation

ISP Integrated Social Programme

JBIC Japan Bank for International Cooperation

JNCC Joint Nature Conservation Committee

KK Kepala Kampung (Village Leader)

KPI Key Performance Indicator

LARAP Land Acquisition and Resettlement Plan

LAT Lowest Astronomical Tide

LNG Liquefied Natural Gas

MoE Ministry of Environment

MoU Memorandum of Understanding

MCC Mediatama Ciptacitra (BP’s main Health Programme partner)

NC Non Compliance

NOX Nitrogen Oxides

OB Onar Baru

OL Onar Lama

PV Photovoltaic


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Acronym Description

QPR Quarterly Performance Review

RAV Resettlement Affected Villages

SO2 Sulphur Dioxide

SOP Standard Operating Procedure

STP Sewage treatment Plant

TIAP Tangguh Independent Advisory Panel

TMB Tanah Merah Baru

UGM Universitas Gajah Mada (BP’s main Governance Programme partner)


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Executive Summary Introduction

This report is the first External Panel Second Iteration (EPII) Operational Compliance Monitoring Report of the Tangguh LNG Environmental and Social (E&S) Project (the Project). EPII has been appointed to undertake independent E&S monitoring of the project’s compliance with the project requirements during the operational period between 2011 and 2016.

As illustrated in Figure 1.1, the Tangguh LNG facility (Tangguh LNG) operated by BP, is situated on the south side of Bintuni Bay, Teluk Bintuni Regency, Papua Barat Province (formerly part of Papua), Indonesia. The Tangguh LNG is extracting natural gas from large offshore reservoirs and piping it to an onshore LNG plant for conversion to LNG after which it is exported (by shipping tanker) to markets in the Asia-Pacific region and beyond. Construction commenced in 2005 and the first cargo of LNG was shipped in the second quarter 2009. Tangguh LNG is anticipated to have an operational lifespan of more than 20 years with the potential for expansion depending on reservoir performance and proving of additional reserves.

Figure 1.1: Project Site and Affected Communities

Indirectly Affected Villages far from the project =

Indirectly Affected Villages near the project =

Directly Affected Villages (DAV) =

Source: BP


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The overall objectives and functions of EPII between 2011 and 2015 are to assess the compliance of operational activities of the Project with the Project’s requirements defined as compliance with: Applicable Asian Development Bank (ADB) and Japan Bank for International

Cooperation (JBIC) policies and the Equator Principles (see Appendix A); PSC Parties Agreements and Loan Agreements; Statutory AMDAL (Indonesian Environmental Impact Assessment) documentation and

requirements ; and Environmental and social management documentation most notably:

o Environmental Management System (EMS); o Land Acquisition and Resettlement Plan (LARAP); o Indigenous Peoples Development Framework (IPDF) and o Integrated Social Programme 1 (ISP1, 2005 -2010) and ISP2 (2010-2015

which incorporates Indigenous Peoples Development Plans (IPDP) in accordance with the requirements of the IPDF.

The work of EPII will entail five annual monitoring audits, and this report presents the findings of the first of these. The temporal scope of this first EPII audit is March 2010 until November 2011. The documents reviewed and the stakeholders consulted by EPII in this first audit are presented in Appendix B and Appendix C respectively.

Review of Monitoring and Reporting

EPII has undertaken a review of BP’s internal and external monitoring, corrective action planning and reporting to lenders, communities and other external stakeholders in accordance with project requirements. In general, it is considered that BP complies with its monitoring and reporting requirements, although a number of shortcomings and areas for improvement have been identified in relation to the following topics: Environmental monitoring scope and reporting issues; Reliability of Continuous Emissions Monitoring System (CEMS); Detection limit of some equipment; Environmental monitoring outside the site; Fugitive emissions reduction program; Marine mammals and reptiles studies and action planning; and Community grievance mechanism.

Overall EPII concurs with BP’s monitoring findings that ISP2 is on track and performing effectively resulting in tangible social and community development outcomes. Key findings of the programme monitoring undertaken and EPII’s comments on the programme performance in 2011 are presented in the main body of this report. In 2011 (the first audit period) there haven't been any significant developments which would


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trigger ISP revisions as per section D1 of the IPDF. The AMDAL (ESIA) process for the Tangguh Train 3 expansion is expected to commence in the near future (dates to be confirmed) and EPII will review the need for ISP revisions in relations to indigenous peoples during each of the future audits.

Land Acquisition and Resettlement Plan (LARAP) Close-Out Review

The LARAP implementation process was scheduled to be completed in 2010. The large majority of land acquisition and resettlement activities were completed by that time, however EPI identified 14 recommendations for close out. EPII has undertaken a review of the LARAP implementation close out progress and these 14 issues have formed the scope of EPII’s review.

Based on the current conditions, field discussions and document review, EPII considers the LARAP can be closed out and the recommendations for the 14 outstanding issues addressed through ISP2. See Table 1.1 for details.

Table 1.1: EPII Review of LARAP Remedial Action Completion No. EP1Corrective Action

Requirement Closure Status Recommendations

1 Dimaga Foundation1 (DF) Management

Closed out: DF is a registered Foundation and its management structure includes a four member Board.

Through the ISP2 programme, additional BP resources are needed in 2012 to improve and ensure the Foundation is functioning appropriately.

2 Dimaga Foundation (DF) financial advisor

Closed out: EPII believes that a BP CFO will be able to provide sufficient financial advice.

Ensure the CFO has the appropriate training and support to perform his/her role.

3 Dimaga Foundation (DF) investment strategy

Closed out: current low risk investment is deemed appropriate.

Through the ISP2 programme, the investments strategy should be reviewed and if necessary revised annually.

4 Public utilities repairs. Closed out: BP fixed the diesel generator in 2010. The generator was part of the handover from BP to OL.

None.

5 Rationalisation of photovoltaic (PV) solar technology

Closed out: The deactivated solar system has been handed over to the community and/or the local government

If the village or local government wants the equipment dismantled, BP should be responsible for doing so.

6 Public utilities review Closed out: RAVs functioning water and electricity systems.

None.

7 Socialisation on electricity payments

Closed out: community members and village leaders confirmed that socialisation had taken place

Manage any public commentary about electricity payments sensitively to prevent misinformation being spread.

_________________________ 1 DF is an ongoing endowment fund established as a benefit-sharing scheme for discretionary consumption purposes. To provide the

intended benefits to clans that were previously affected, it is now considered as a part of the ISP2 activities and needs to be treated as an ongoing development activity with a long term perspective.


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8 Monitoring progress in cooperative performance in utilities management

Closed out: there has been close cooperation between BP and Mayri Cooperative

Monitoring of Mayri Cooperative needs to be formalised in the ISP2 2012 plan.

9 Handover to the communities: Closed out: evidenced by the handover agreements

Consider whether house maintenance training would be useful.

10 RAV repairs Closed out: evidence by the minutes of the meeting about the completion of renovations.

As above

11 Address apparent decline in incomes

Closed out: The UGM 2009 study showed that livelihoods had been restored.

More ISP2 presence is needed in OL. Activities should be clearly identified in the ISP2 2012 plan.

12 Livelihood diversification towards livestock

Closed out: EPII considers this current approach appropriate.

Clearly communicate potential benefits / constraints of livestock programmes

13 Prawn and fish product certification assistance

Closed out: this requirement is not appropriate at present as certification is not a priority for the cooperatives.

The capacity to implement and benefits from certification could be considered during the ISP2 mid term review.

14 Investigation into apparent decline in fish and prawn incomes

Closed out: as evidenced by the fish survey results.

Results of the study should be fed back to the communities to contribute to reality based perceptions.

EPII recommends that the resettled villages no longer be identified as such. Rather they should be considered in an equivalent way to other directly affected villages. ISP2 should continues with its integration approach where the resettled villages are identified as part of the directly affected villages and as part of the neighbouring societal context. Treating the previously resettled villages similarly to other settlements in the area is considered necessary to minimise dependency on BP and inter-village jealousies.

Non Compliance Assessment Findings

As summarised in Table 1.2 overleaf, EPII identified: Five level 1 non compliances (NC1); and Zero level 2 non compliances (NC2).

Recommended corrective actions associated with these non-compliances have also been provided.

BP has stated to EPII its willingness and commitment to addressing all of these NC1s and actions will be reported to lenders in the six monthly report that will be issued in July 2012. EPII will review the adequacy and effectiveness of these actions and the reporting of them as part of its second annual audit in November 2012.


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Table 1.2: Level 1 Non-Compliances Identified and Recommended Corrective Actions No.

Topic Project Requirement Description of NC1 Recommended Corrective Action (CA)

1 Wastewater discharge

RPL p62, RKL p16 and 27. states that during operation, sewage water will be discharged to the sea at the Common outfall at -13m.

Wastewater from Sewage Treatment Plants (STP) A, B and C is, and has been, discharged at the construction jetty area.

BP has progressed with installation of new sewage water discharge line. CA is to complete current plans to lay support line to the -13m outfall and shut the temporary line as soon as possible.

2 Environmental monitoring exceedances

Compliance with Indonesian legislation.

A number of exceedances of Indonesian limits; some comply for less than 90% of the measurements.

Each exceedance to be flagged as a non conformance in the EMS and action taken to remedy. Improvement to temporary Waste Water Treatment Plant (WWTP). Rerouting of effluents for additional treatment if required.

3 Sediment monitoring

Seawater monitoring should include sediment monitoring for benthos (RPL p24, 57).

Sediment monitoring is undertaken on a 6-monthly basis but does not include benthos.

Review monitoring and reporting programme.

4 Flora and fauna surveys

Flora and fauna to be monitored twice during construction and every two years during operation (RPL p94).

One of the required construction phase surveys has been delayed.

Carry out missing survey (currently being undertaken) and comply with operation phase schedule. Implement recommendations from previous surveys.

5 Community grievance mechanism

Numerous references in RPL ISP2 pp.44,45.

Grievance responses not meeting 14 day target.

Improve response time, revise system to log grievances and community requests separately, change title of feedback card.

Additional Areas for Improvement & Recommendations

Two areas of the project not meeting international best practices as well as recommended actions are summarised in Table 1.3 below.

Table 1.3: Additional areas for improvement and recommendations Improvement Topic Requirement Issue Recommended actions

Flaring Continuous flaring of gas should be avoided if feasible alternatives are available. If flaring is necessary, continuous improvement of flaring through implementation of best practices and new technologies should be demonstrated.. (1)

Large quantities of gas flared compared to baseline. Elevated baseline.

Implement pollution prevention and control measures for flaring in line with international best practice. Reduce flaring. More stringent targets. Step changes.

Indigenous peoples cultural heritage

LARAP requirement to develop Cemeteries Access and Maintenance Agreement providing access.

Perception in Onar Baru that BP is not meeting its commitment regarding cemetery access in 2010 or 2011.

Improve procedure on initiating contact and notifying all villagers (not just village heads) about the visit schedule and logistics.

Note 1 – International Best Practice is considered to be as set out in IFC Environmental, Health, and Safety Guidelines for Onshore Oil and Gas Development, April 2007.


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Concluding Comments

In conclusion, EPII finds the Project to be largely compliant with Project requirements and no critical or significant risks have been identified.

EPII finds that the Project’s Environmental Management System is well defined, based on international best practice and on the whole is effective in meeting Project requirements and ISO 14001 commitments. EPII concurs with BP’s monitoring findings that ISP2 is on track and performing effectively resulting. The key challenge for the remainder of the ISP2 programme will be countering the community dependency culture that has developed under ISP1. EPII notes that BP recognises this, and is proactively focussing on capacity building of government and local communities in order to meet the ISP2 goal of “laying a foundation of sustainability,” by moving away from a process of “development for communities”, to a situation of “development with communities”.

EPII notes BP’s commitment to address all of the identified non-compliances and risks through corrective action planning and EPII is of the opinion that BP are willing and able to do so, thus avoiding the risk of any systemic failures in environmental and social management and monitoring.

EPII would like to acknowledge the openness and assistance of BP’s team leaders and the Lenders’ Consultants in providing information and explanation and facilitating the monitoring visit.


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1. Introduction

1.1 Overview

This report is the first External Panel Second Iteration (EPII) Operational Compliance Monitoring Report of the Tangguh LNG Environmental and Social (E&S) Project. EPII has been appointed to undertake independent E&S monitoring of the project’s compliance with the project requirements during the operational period between 2011 and 2016. This is the eighth EP compliance monitoring report, and a continuation of the monitoring work undertaken by the External Panel First Iteration (EPI) who produced seven reports between 2005 and 2010.

Implementation and internal monitoring of the Project is the responsibility of the operator, BP Tangguh (BP), and a number of implementation partners. In addition to EP monitoring, external E&S monitoring is also undertaken by the Lenders.2

The remainder of this chapter provides some background on the Project; more details on the scope of EPII’s compliance monitoring and specifically the scope of this report; details of EPII’s compliance monitoring approach and activities; and an overview of the structure of this report.

1.2 Tangguh E&S Project Background

As illustrated in Figure 1.1 overleaf, the Tangguh LNG facility (Tangguh LNG) is situated on the south side of Bintuni Bay, Kabupaten Teluk Bintuni, Papua Barat Province (formerly part of Papua), Indonesia. The Tangguh LNG operation is extracting natural gas from large offshore reservoirs and piping it to an onshore LNG plant for conversion to LNG, after which it is exported (by shipping tanker) to markets in the Asia-Pacific region and beyond. Construction commenced in 2005 and the first cargo of LNG was shipped in the second quarter 2009. Tangguh LNG is anticipated to have an operational lifespan of more than 20 years with the potential for expansion depending on reservoir performance and proving of additional reserves.

The Tangguh LNG Environmental and Social (E&S) Project (the Project) follows on from the AMDAL (Indonesian statutory Environmental Impact Assessment) commitments and the international project finance agreements (as set out in the PSC Parties Agreements between the lenders and BP). In accordance with these requirements, prior to and throughout construction BP has developed and implemented a number of environmental and social management and monitoring plans, most notably: Environmental Management System (EMS); Land Acquisition and Resettlement Plan (LARAP); Indigenous Peoples Development Framework (IPDF); and Integrated Social Programme 1 (ISP1) 2005 -2010, which incorporated an Indigenous

Peoples Development Plan (IPDP) in accordance with the requirements of the IPDF.

_________________________ 2 Including the Asian Development Bank (ADB), the Japanese Bank for International Cooperation, Mizuho Bank and

other commercial banks.


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Figure 1.1: Project Site and Affected Communities

Indirectly Affected Villages far from the project =

Indirectly Affected Villages near the project =

Directly Affected Villages (DAV) =

Source: BP

Following completion of construction and the commencement of the operational phase of the Tangguh LNG facility, ISP1 was revised to form ISP2 to govern the implementation of the indigenous peoples and social issues (IPSI) project requirements between 2010 and 2015. ISP2 has been drafted and was published by the end of 2011.

More detailed background information on the Project is contained in the Environmental and Social Documents listed in Appendix A, which have been reviewed by EPII and should be read in conjunction with this report.

1.3 Scope of EPII Operational Monitoring

1.3.1 Overview

The overall objectives and functions of EPII are to assess the compliance of operational activities of the Project with the Project’s requirements. These requirements, and the specific scope of the EP monitoring activities throughout the duration of the EPII period, and during the first audit, are outlined in the sub-sections below.

1.3.2 Assessing Compliance with Project Requirements

The Project Requirements are defined as compliance with: Applicable Asian Development Bank (ADB) and Japan Bank for International Cooperation

(JBIC) policies and the Equator Principles (see Appendix A); PSC Parties Agreements (see section 1.3.4 for more details) and Loan Agreements; AMDAL documentation and requirements ; and


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Environmental and social management plans developed by BP (see section 1.2).

All of the above listed documents that define the specific environmental, IPSI and resettlement project requirements are listed and referenced as applicable throughout this report.

1.3.3 EPII Role

Specifically, it is the role of EPII through compliance monitoring activities to: a. Satisfy the ADB and the JBIC’s policy requirements and the Equator Principles’

requirements for independent external monitoring and evaluation of environmental and social aspects of the Project (see Appendix A);

b. Verify the internal monitoring undertaken by BP; c. Report regularly to the Lenders and BP on environmental and social compliance

issues that arise in connection with the Project, having regard to the following i. The Environmental and Social Provisions contained in the PSC Parties

Agreements; ii. The Environmental and Social Documents3 (as construed in accordance with

each PSC Parties Agreement); and iii. The applicable environmental and social policies and safeguard requirements

of the ADB Tranche Lender and JBIC and the Equator Principles; d. Review and comment (for the benefit of the Lenders and BP) on reports delivered

by BP for the purposes of the PSC Parties Agreements4: e. Review and comment (for the benefit of the Lenders and BP) on Corrective Action

Plans prepared by BP as required under the Environmental and Social Provisions contained in the PSC Parties Agreements; and

f. Report to and advise BP and the Lenders on an ad hoc basis in relation to environmental and social issues that arise in connection with the Project.

The activities to be undertaken by EPII to perform this role are listed in the following sub-section.

1.3.4 EPII Activities and Team Composition

EPII will undertake six annual compliance monitoring site visits and produce annual audit reports between 2011 and 2016. As part of the third audit (2013) EPII will undertake a mid-term review of the ISP2. As part of the fifth audit (2015) EPII will comment on the draft ISP3 which will be produced for the period 2016 to 2021.

In addition to annual monitoring, ad-hoc health and safety reviews may be requested at the lenders discretion or by EPII in the event of identification of a Level 2 non-compliance (defined in section 4.2).

The overall objectives and functions of EPII between 2011 and 2016 are to assess the compliance of operational activities of the Project with the Project’s requirements defined as compliance with the environmental and social management documentation including the Indigenous Peoples Development Framework (IPDF). In accordance with Section D1 of the _________________________ 3 As listed in section 1.2 of this report. 4 Sections on Certain Environmental, Involuntary Resettlement and Indigenous Peoples Matters in the ADB Tranche

PSC parties Agreement (Paragraph (B) of Section 1.12) and the Japanese Tranche PSC parties Agreement (Paragraph (B) of Section 1.18); paragraph (a) or (b) of Section 1.12 (Environmental Reports) of the Commercial Tranche and the FJT Tranche PSC parties Agreements.


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IPDF, the IPDF is triggered "if and when there are significant changes in the political and socio-economic environment in which the Project is operating and/or the Project adds new components or sub-components which may affect indigenous peoples." This may require revisions to ISP2 by BP. During each of the annual visits EPII will review BP’s consideration of the necessity of ISP2 revisions and the quality of any revisions undertaken.

These activities and responsibilities will be performed by the EPII team consisting of the following two sub-teams, each comprising international and national specialists (including indigenous west Papuans): Environmental Team – responsible for monitoring environmental compliance; Indigenous Peoples and Social Issues (IPSI) Team – responsible for monitoring

compliance with IPSI and resettlement requirements.

The IPSI team included an additional Resettlement Specialist for the first audit in order to review the progress in closing out the LARAP implementation, which was expected at the end of construction. This specialist will be used further in future audits as appropriate.

1.3.5 Scope of EPII First Annual Monitoring Audit

This report presents the findings of EPII’s first annual compliance monitoring audit undertaken in November 2011. The key difference between the work of EPI and EPII is that EPII is monitoring operational compliance for the period 2011 to 2015, rather than the compliance of construction activities through 2005 to 2010. However, where key issues identified in the EPI’s last monitoring report produced in August 2010 (and the final EPI audit undertaken by the environmental EPI team in March 2010) have not been addressed, these are discussed within this report. In summary, the temporal scope of this first EPII audit can be considered to be March 2010 until November 2011.

In addition to addressing operational rather than construction requirements, the key differences between the scope of this first EPII monitoring audit and the aforementioned previous EPI audits include: Compliance with IPSI project requirements are now being assessed against ISP2 rather

than ISP1; The LARAP close-out review is limited to consideration of the effectiveness of the

implementation of the 14 corrective actions proposed in the previous LARAP evaluation undertaken by EPI in 2010;

EPII’s scope excludes LNG ships, platforms and sub sea lines; and Health and safety is excluded from this review and is only to be addressed by EPII on an

ad-hoc basis as explained in Section 1.3.4.

The key aspects which are excluded from the scope of this first EPII audit but which may be addressed in other audits include a review of the annual report for 2011 including annual budget and budget realization data. This is a requirement of EPII as specified in ISP2, however this information was not available at the time of writing this report.

1.4 EPII Compliance Monitoring Approach and Activities

1.4.1 Overview

The EPII team undertook its first annual monitoring site visit between the 11th and 28th November 2011. The first week of the visit was spent in Jakarta in BP’s central offices to review the project documentation, to participate in presentations from BP project personnel and to discuss and refine the scope for the monitoring trip to the Project site. The following


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week was spent at the Tangguh LNG Facility to review the site and surrounding community conditions and to interview project and external stakeholders, including participatory focus group discussions.

The EPII approach to assessing compliance has been the identification of areas of non-compliance (NC) and risks that should be addressed. The key aim of this report is to present these NC and risk findings, as well as practical recommendations as to how they can be addressed. In relation to topics where NC or risk findings are not presented, the project can be considered to be fully compliant in these areas. Although this approach and this report does not aim to identify all of the examples of good practice and effective project performance, some such examples are highlighted in various sections of the report. It should be noted that whilst the report focuses on areas of poor performance, the overall conclusions of EPII after his first audit are that the Project is resourced, managed and is resulting in beneficial sustainable development outcomes (as explained further in section 6).

The areas of site visited, the sources of information reviewed, and the stakeholders consulted are summarised in the following sub-sections.

1.4.2 Project and Community Locations Visited

The locations visited within and outside of the project site are presented in Table 1.1 below.

Table 1.1: Locations visited during site visit Locations visited within the Project site Locations visited outside the Project site

LNG Plant Area Bintuni Town

Construction Jetty Taroy Village (see Figure 1.2 overeaf)

Non hazardous waste landfill / helipad Tofoi Village

Lay-down area Tanah Merah Baru Village

Recycling facilities Saengga Village

Hazardous waste storage area Onar Baru Village

Permanent wastewater treatment plant Onar Lama Village

Sewage treatment plants Manggosa Pathway (access route around site perimeter)

Contractor camps

Fauna and flora survey transect

Facility laboratory

1.4.3 Documents / Data Reviewed

The key types of documents and data that were reviewed during the site visit are summarised as follows: Project requirements including AMDAL documentation, PSC Parties Agreements and loan

agreements, and concordant project finance documentation including IPDF, ISP and LARAP;

Environmental Management Plan (EMP) and Environmental Management System (EMS) data;

Internal and external monitoring reports; Site records (e.g. grievance log, environmental monitoring data, etc.); and Local government census data and other records of external parties.

The full list of documents reviewed is presented in Appendix B.


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Figure 1.2: Taroy Village, one of the Directly Affected Villages visited by EPII

Source: EPII site visit

1.4.4 Stakeholders Consulted

The key types of project and external stakeholders interviewed, and in some cases included in the 12 participatory focus group discussions, were: Tangguh Jakarta based central and site personnel; Government officials at the regency and village level, Project affected people in the Directly Affected Villages (DAVs) and Resettlement Affected

Villages (RAVs); and Implementing partners, such as the British Council (BC).

The full list of stakeholders that EPII met with is presented in Appendix C.

1.5 Limitations

Due to time constraints, not all areas of the Project site and activities, and not all of the DAVs could be visited. In particular, this first EPII environmental audit was limited to the site boundaries. Efforts will be made to visit the other areas in future monitoring visits. Also, because this was the first EPII monitoring audit, there was a large amount of background information required to be assimilated over a short period of time.

1.6 Structure of Report

The remainder of this report consists of the following sections: 2. Review of Monitoring & Reporting; 3. LARAP Close-out Review


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4. Non-Compliance (NC) Assessment; 5. Additional Improvement Areas & Recommendations; and 6. Concluding Comments.


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2. Review of Monitoring & Reporting

2.1 Overview

This section presents the findings of EPII’s review of BP’s internal and external monitoring, corrective action planning and reporting to lenders, communities and other external stakeholders in accordance with project requirements (see section 0 of this document).

2.2 Environmental Monitoring and Reporting

2.2.1 Environmental Monitoring and Reporting Requirements

BP is required to carry out regular monitoring and reporting as well as occasional studies and surveys. The commitments arise from: The AMDAL (statutory Environmental Impact Assessment (EIA)) and subsequent

discussions / permits from the environmental authorities (in particular the Ministry of Environment (MoE)) including an environmental management plan (RKL) and monitoring plan (RPL) which, following approval by the authorities, are also statutory requirements. It should be noted that further project activities not covered in the original AMDAL (such as dredging work or helipad construction) have only required Environmental Management Effort and Environmental Monitoring Effort (UKL / UPL) studies.

The PSC Parties Agreements. The International Standards organisation (ISO) 14001 certified EMS which although not

legally binding, failure to comply with it could result in the loss of the certification.

Compliance with these requirements and the results of environmental monitoring are discussed in the following sub-sections.

2.2.2 Review of Environmental Monitoring and Reporting Activities

2.2.2.1 Overview

EPII witnessed evidence of the computer program that BP has put in place to track its EMS commitments, which also covers most of the AMDAL and Lenders’ commitments. External monitoring of most environmental parameters is carried out on a 3 to 6-monthly basis (depending on the parameter, as required in the operational permit (RPL)) as evidenced by the reports provided to EPII for review. Internally, some parameters are monitored continuously (such as air emissions from the Acid Gas Incinerator (AGI)), while others are analysed in BP’s lab on a daily to monthly basis. EPII has reviewed the six-monthly reports issued to the MoE and the Lenders and it notes that some parameters, such as seawater monitoring results, are not included in those reports. In general, it is considered that BP complies with its monitoring and reporting requirements, although we have identified a number of shortcomings as discussed in the sub-sections below.

2.2.2.2 Environmental Monitoring Scope and Reporting Issues

Based on the RPL, seawater monitoring should include six-monthly sediment monitoring for benthos; however this requirement is not being fully complied with as discussed in more detail in section 4.3.2.4 where recommended corrective actions are proposed.


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Effluent sampling is to be carried out weekly for sanitary wastewater. Although this is done internally, the results are not reported to MoE in the six-monthly reports.

The RPL (p56-57) lists individual metals to be monitored and their regulated concentration in process water and seawater. Whereas BP explained that metals concentrations are monitored individually, monitoring reports only present one value for “toxic metals”. Again, presentation of the results should be in line with RPL requirements.

2.2.2.3 Reliability of Continuous Emissions Monitoring System (CEMS)

The data provided (January, March and April 2011 CEMS readings, July to September 2011 report to MoE, instant readings from the control room) as well as feedback from BP staff seem to indicate some issues with the CEMS. Negative readings highlight calibration problems, while a number of zeros or very low values where higher ones are expected (e.g.: NOX from Gas Turbine 1, July 2011 or SO2 not detected in AGI Train 1 exhaust but consistently detected in AGI Train 2) undermine the reliability of the monitoring data. EPII recommends that the manufacturers provide servicing and calibration as this should be included in their contract.

2.2.2.4 Detection Limit of Some Equipment

A number of parameters are reported as being below a certain value, which is understood to be the instrument’s detection limit. This limit is, in some cases, too high in comparison to the standard. Internal monitoring of open ditch and groundwater for example, can only detect copper concentrations above 0.04 mg/L, while the assessment criterion is 0.02 mg/L. Similar inconsistencies are noted for phosphate in seawater and sulphide in groundwater. The (external) ambient air monitoring results also have a very high detection limit, and none of the pollutants were detected in 2011. Even if there were no emissions from the site, pollutants such as particulates levels should be detectable, especially near the sea (where sea spray can occur). EPII recommends that BP discusses with the external and internal environmental teams and labs to ensure the best monitoring equipment is used throughout. If for some parameters, there is no equipment in Indonesia capable of detecting the relevant parameter (well) below the corresponding standard, this should be clearly indicated in the report.

2.2.2.5 Monitoring Outside the Site

There is no ambient air or noise monitoring outside the project boundaries – and noise is no longer monitored onsite. Although we understand this is either consistent with the AMDAL or has been agreed with MoE, EPII find this is not best practice and recommends that air and noise monitoring at the nearest villages is carried out.

2.2.3 Review of Environmental Survey Completion

2.2.3.1 Overview

The following studies and surveys were required and carried out during the reporting period, either as ongoing requirements from the AMDAL / the Lenders or as new studies addressing aspects not previously covered: Environmental Management Effort and Environmental Monitoring Effort (UKL/UPL) for

additional dredging activities that had not been anticipated at the time of the AMDAL. Approved 2010;

UKL / UPL for a proposed additional helipad, approved 2011;


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Bintuni Bay Seawater and Sediments Survey (including plankton and benthos), part of the UKL / UPL for future production wells, submitted 2011;

Site flora and fauna survey, fisheries survey, 2008; Study of impacts of seismic activities on marine mammals, 2011 (part of UKL / UPL for

seismic operations, not reviewed); and Fugitive air emissions study, 2011.

Following discussion with MoE, the development of the new produced water treatment plant did not require a separate AMDAL or UKL/UPL.

One incidence of non-compliance has been identified in relation to the completion of flora and fauna surveys as discussed in more detail in section 4.3.2.5. Other than this, the above list of surveys demonstrates that BP is generally in compliance with regards to carrying out the required environmental studies and surveys, the results of which are discussed in section 4.3.2.3. Despite the general compliance with survey completion requirements, the following sub-sections identify some issues to be addressed.

2.2.3.2 Fugitive Emissions Reduction Program

The main RPL for the facility requires a fugitive emissions reduction program to be put in place with leak detection using hydrocarbon ‘gas-sniffers’. A survey was completed in April 2010 by a third party, detecting potential leaks using infra-red camera. It can be assumed that the MoE would have no objection to using a different, more accurate technique, but there is still, at the time of writing, no fugitive emissions reduction program as such, which is not in line with the AMDAL requirements. We were informed however that the purchase of in-house infra red cameras and training in their use had been approved for next year. This should be accompanied by integration of fugitive emissions monitoring in the overall regular environmental monitoring program, and communication of the results to the maintenance team for their prompt action on any leak detected. More specific recommendations, which should also be implemented, are made in the April 2010 fugitive emissions survey report.

2.2.3.3 Marine Mammals and Reptiles Studies and Action Planning

The Japanese Tranche of the PSC Parties Agreement includes a requirement to conduct marine mammals and reptiles studies, develop a Marine Mammals Action Plan and implement the recommended actions from the action plan. While this has not been formally followed through, a marine ecology study was carried out by APEX and UNIPA in 2006/2007. The results from the 2006/07 report were summarised in the Tangguh Marine Mammals Guidebook, which also included a series of recommendations. Although these recommendations have not been followed through in a systematic manner, a number of measures have been taken such as rerouting of the LNG/condensate tanker away from Raja Ampat Marine Biodiversity area, conducting seismic survey in accordance to Joint Nature Conservation Committee (JNCC) guideline and conducting marine mammal monitoring (not done specifically to address the Tangguh Marine Mammals Guidebook recommendations but as part of drilling and seismic activities). The Tangguh Marine Mammals Guidebook recommendation to conduct offshore cetacean surveys in the McCluer Gulf and Seram Sea to better evaluate the possible impacts of LNG tanker traffic on oceanic cetaceans has not yet been followed through. A further survey (not covering McCluer Gulf) is planned for 2012. Overall, we consider that partial compliance is achieved, although more systematic monitoring should be undertaken.


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2.2.4 Environmental Monitoring and Reporting Recommendations

Based on our review, we have identified some future requirements and potential areas of improvements: As a new landfill will be built, and since previous monitoring undertaken identified some

natural exceedances of Pb and As, it is important that more groundwater monitoring is carried out to establish a robust groundwater baseline.

More generally, EPII recommends that more ambient monitoring is incorporated into the programme, and where it is already monitored, that it is more explicitly reported. This includes: − More ambient monitoring at unaffected locations should be carried out in parallel to the

discharges monitoring to provide a point of reference; in particular, this should include monitoring at the water intake.

− When ambient pollutant concentrations are already above the standards, the reports should refer to elevated values as opposed to non-conformance

− New baseline studies carried out for additional activities should be robust in order, where possible, to provide a numerical reference to compare against when later carrying construction / operation monitoring. Such studies should incorporate results from previous studies and previous monitoring programs.

BP should maintain a timeline of key “events”, internal or external, which influence monitoring results. This includes plant load / throughput (ex: acid gas incinerator load), maintenance, trips, instruments issues, peaks in workforce, extreme weather etc. These events should then be reported along with the monitoring results, to provide a robust assessment of the reason why certain parameters are high / low etc.

Further analysis and follow up on the internal monitoring is required. This could allow identification and rectification of an issue ahead of the external monitoring and thus not result in a non-compliance. Furthermore, internal monitoring results are more numerous and should be used to derive a compliance percentage to be compared with the unofficial MoE guideline of 90% of the time.

Recycled waste quantities should also be reported as a percentage of total waste generated.

Fauna and flora surveys should be carried out following the same transect if possible to allow like-for-like comparison between before / after or temporal evolution of the situation. In general, BP needs to understand the fauna and flora population dynamics to understand if the project is having long term impacts other than obvious loss of habitat and specimens from land clearance.

Environmental awareness should be included in community programs as some of the monitoring results show significant impacts on the environment likely to be caused not by the project, but by the community. This could be financed by the Environmental Team who would take ownership over the programme, with facilitation assistance from the ISP team.


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2.3 IPSI Monitoring and Reporting

2.3.1 IPSI Monitoring and Reporting Requirements

ISP2 translates the monitoring and reporting requirements stipulated by the AMDAL5 and the PSC Parties Agreements6 into an ISP2 monitoring, evaluation and reporting framework. This framework describes monitoring as the process to assess and measure whether planned activities and resources are being conducted according to project requirements, whereas evaluation is defined as the process to check and analyse the performance and impact of activities against stated indicators.

The monitoring requirements and parameters of ISP2 are slightly different to those ISP1 because the 14 programmes of ISP1 have been consolidated into five core programmes in ISP2 in pursuit of the overall ISP2 goal:

“to support local effort to enhance the quality of life of local communities through participative and accountable local development practices and to contribute to Tangguh LNG operational sustainability”.

The five ISP2 programmes consist of three ‘building’ programmes, namely: 1. Community Health; 2. Education & Training; and 3. Livelihoods.

Two ‘foundation’ programmes designed to act as enablers for the ‘building’ programmes, namely: 4. Governance; and 5. Communications and External Affairs (C&EA).

ISP2 describes the context, objectives, desired outcomes, key outputs and assumptions of these programmes in the period 2011-2015, and for the purpose of monitoring, presents key performance indicators (KPIs) for the five year programmes against each of these headings.

The ISP2 requirements for BP’s monitoring and reporting activities are as follows: Internal monthly programme tracking and reporting - to collect data and information to

develop preliminary findings on the progress of activities; Internal Quarterly Performance Review (QPR) – to review the targets of activities to

identify the problems and challenges; External bi-annual AMDAL and lenders reports7 – to monitor the progress of stated results

and commitments and to formulate recommendation; and Annual Performance Review – to review the progress and achievement of activities,

formulate refinement and adaptation to actual context.

_________________________ 5 The AMDAL contains 222 social commitments for the operational phase of the project and approximately 22 of

these include specific monitoring requirements. BP informed EPII during the site visit that not all of the AMDAL social commitments were included in the scope of EPII, however it was not clarified which items were included and which weren’t. This issue will require clarification prior to the next EPII monitoring visit.

6 See section 0 of this report for reference to the PSC parties agreements monitoring and reporting requirements. 7 These reports are designed to meet the PSC parties agreements lender monitoring and reporting requirements

outlined in See section 1.3.1 of this report.


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BP has a staff of more than 50 to implement, monitor and supervise the ISP2 activities. BP is also dependent on contractors to implement programs and BP’s implementing partners have frequent and detailed reporting requirements which contribute to the monitoring efforts.

As well as ISP2 programme performance one of the key parameters to be monitored and reported by BP is community grievances, as stipulated in the RPL and elaborated in ISP2. In summary, ISP2 defines the grievance mechanism process requirements as: Receiving grievances: through writing them on the grievance form and verbally through to

field staff; Categorizing and recording the grievances: filled grievance form will be analyzed, recorded

and categorized by the field staff to ensure that the whole process of responding to the grievances does not exceed 14 working days;

Submitting the grievances to the coordinator and responsible unit; Delivering response of grievances to the community; Closing out grievances through recording the acceptance of the grievance or if not

accepted by the community re-submitting the grievance to the appropriate unit; and Quarterly consolidation of grievances and internal reporting to the BP Tangguh

Management.

Compliance with these requirements and EPII’s opinions on the quality and outcomes of the monitoring is discussed in the following sub-sections, with the exception of the Annual Performance Review which was not available for 2011 at the time of writing this report. Compliance with LARAP monitoring requirements is discussed in section 3.

2.3.2 Review of IPSI Monitoring and Reporting Activities

2.3.2.1 Overview

IPSI monitoring is undertaken against annual ISP2 implementation action plans which are developed by BP to meet the ISP2 programme objectives. The annual plan for 2011 is included in Annexes 10-15 of the current ISP2 document (a live document that will be updated annually). The context, objectives, outcomes, outputs and assumptions of the five ISP2 programmes are described specifically in relation to 2011. Annual KPIs are included in ISP2 for the entirety of the five year programmes as previously noted, although not included in the annual plan for 2011. BP has however provided EPII with the annual plan worksheets for 2011 that include KPIs, which seem appropriate. The ISP2 uses a typical log-frame approach that helps structure planning and monitoring with objectives, outcomes, outputs and activities. Outcomes are determined by a number of contributing factors, many of which may be outside the control of BP. However the activities and outputs are likely to be contributing factors. At the beginning of the Project, BP gathered a full range of baseline data and there are sector specific targets they measure against, for instance pass rates in education and infection prevalence and incidence in health. These data and monitoring results mean they are able to compare across time and with other geographical areas in the region, even nationally. BP’s current approach of using a log-frame and setting activity targets is considered appropriate.

Overall, EPII considers the internal monitoring and reporting approach and systems to be adequate and effective and BP is on the whole meeting its internal and external reporting commitments in line with Project requirements. Some issues and improvements related to the achievement of the development objectives have been identified and are discussed in the following sub-sections.


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2.3.2.2 Internal Monthly Tracking and Reporting

BP demonstrated its IPSI internal monitoring processes through the use of internal tracking spreadsheets8 that are updated every month for the purpose of tracking ISP programme progress. Despite annual KPIs not being included in the ISP2 document, the internal tracking spreadsheets do include KPIs9, as well as the activities and the achievements of each month, and total percentage achievement for the year against the KPIs. As mentioned previously, implementing partners provide information regularly which is reflected in BP’s internal reporting.

BP provided EPII with nine monthly operational reports in 2011, from January to September. EPII finds that the results of the internal monthly tracking monitoring could be presented more clearly in a systematic and transparent manner in the monthly monitoring reports. For instance they are currently largely descriptive, without a clear set of standard indicators being used each month. It is recommended that a summary of progress against the previous month’s performance is included in the monthly reports for each of the ISP2 programme. This will enable progress to be monitored more effectively internally, and improvement measures to be implemented on a monthly basis as discussed below.

2.3.2.3 Reporting Improvement Measures

The results in the internal monthly reports and bi-annual reports to lenders generally show success and continuous improvement in all of the ISP2 programmes, as detailed further in section 2.3.3 below. In cases where programme performance has not met targets, or where results have deteriorated (for example the increase in malaria prevalence between 2009 and 2010 as noted in October 2010, to April 2011 bi-annual report) special improvement measures are referred to (for example capacity building and mentoring for the new malaria workers). However, the monitoring reports do not include a section specifically detailing measures to improve performance, for instance recommendations, innovations and lessons learned. In recognition of the fact that there is always room for continuous improvement, it is recommended that BP revises the report structure to include a specific section(s) on measures to address challenges or modifying programmes.

2.3.2.4 Community Grievance Mechanism

BP demonstrated to EPII the comprehensive electronic grievance logging system which included all of the appropriate information such as the community stakeholder’s details, the response times and a link to a copy of the response provided. EPII concludes that BP is meeting the requirement of logging grievances. However grievances were not systematically evaluated to assess and identify their: a) validity, b) risk and c) likelihood of re-occurrence. Furthermore, grievance findings and evaluation were not reported in any of the 2011 monthly internal monitoring reports to BP’s management, or in the last bi-annual report to lenders. It is recommended that the structure of these reports is amended to include a section on community feedback and grievance investigation results and how they have been addressed, as well as pattern evaluation results highlighting repeat grievances. In addition to these tracking and reporting issues, EPII has identified more fundamental problems with the effective functioning of the grievance mechanism with regards to responding to community

_________________________ 8 Examples provided for the health and livelihoods programmes for 2011. 9 It is not entirely clear how these KPIs are set and EPII would appreciate further clarification on this prior to

finalisation of this report.


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stakeholders in writing within the required 14 day period. This non-compliance and additional recommended corrective actions and advice are discussed in section 4.3.2.6. .

2.3.3 Review of IPSI Monitoring and Reporting Findings

For the ISP2 ‘building’ programmes, internal monitoring data shows that in almost all cases the stated objectives and KPIs are being met or exceeded. EPII notes that in the few cases where objectives are not being met, this is largely as a result of change in circumstances meaning that the KPI is no longer applicable, or because the outcomes are expected later on or at the end of the ISP2 programme, rather than at the end of the first year. Overall, EPII concurs with BP’s monitoring findings that ISP2 is on track and performing effectively, resulting in tangible social and community development outcomes. Key findings of the programme monitoring undertaken in 2011 and EPII’s comments on the results and on audit observations are presented in Table 2.1 overleaf. Additional recommendations to address specific risks to the programmes success are also provided in section 5.3.

2.3.4 Review of ISP Revisions in Accordance with the IPDF

In 2011 (the first audit period) there haven't been any significant developments that would trigger ISP revisions as per section D1 of the IPDF. Although the specific dates are yet to be confirmed, BP has stated that in 2012 there will be an AMDAL process for Tangguh Train 3 Expansion and through this process the need for revisions to ISP2 as per the IPDF will be considered. Related to IPDF, BP will conduct public consultation and obtain TOR AMDAL approval from MoE and then the Tangguh Expansion AMDAL (ESIA) process will commence (dates to be confirmed). EPII will review the progress of these activities in 2012 and remaining annual audits with a detailed summary during the mid-term review in audit 3.


Table 2.1: ISP2 monitoring findings and EPII comment on quality of monitoring and progress in programme implementation ISP2 objectives ISP2 desired outcomes E.g. key bi-annual monitoring report

findings10EPII comment on monitoring verification / programme outcome findings

Improved performance based development planning and budgeting by government through integrated, participative, and representative process.

In the DAVs, the community development program continues to support the villages through the Community Action Plan (CAPs) program. In 2010, communities conducted all the CAPs processes: from the participatory planning, as well as the implementation and monitoring.

Villagers generally explained that in the last year, BP’s CAPs and the Musrengbang process (local government (Gvt.) participatory planning) had been successfully integrated. This alignment was reported as being particularly successful in Saengga, once problems with submitting CAPs proposals had been overcome with the introduction of a new procedure. This appears to be one of the ISPI success stories over the past 18 months.

Improved public services on health, education, and public administration through transparent and accountable management.

Restart governance capacity building program in the district and village level by the Universitas Gajah Mada (UGM), continued mentoring sessions as the previous programs that include planning, budgeting, roles and responsibilities, and administrative matters. Total of 269 government officials attended training and mentoring, of which 61 were women.

ISP2 is working with government partners in various sectors. EPII saw evidence of local officials and staff having planning, data collection, budgeting and administrative skills. The quality of training activities was frequently praised. Bintuni Regency Bupati expressed satisfaction with governance programme and work of BP’s partner, UGM at local and Regency level. However, there is also desire for greater government involvement at the planning stage of BP’s programmes and integrated budgets. Key benefits identified are ‘Renstra’ (5 yr. strategic planning) and greater understanding of TUPOKSI (roles and responsibilities) especially regarding agriculture, as well as capacity building on revenue sharing with central government and within Province.

Increased awareness by governments and communities in Directly Affected Villages (DAVs) and Resettlement Affected Villages (RAVs) about the impacts of in-migration.

No reference in monitoring report. Evidence was seen of tracking in-migration in villages by local government, rather than by civil society. At regency and local level, government capacity building in monitoring population movement was appreciated by government, with recognition of the limits on controlling migration in accordance with national legislation. In Onar Baru there were public signs notifying migrants that they had to register if they were staying for more than three months. EPII did not find the issue of in-migration to be significant in discussions with community stakeholders.11 It seems that the DAVs are accepting that communities change with time and circumstances.12

Governance objective: Contribution to the improvement of governance of government and civil society in accordance with transparency, accountability, and participation principles.

Improved participation of civil society in oversight of

Media campaign targeted to civil society and NGO groups in Papua Barat. Conducted law

No evidence of civil society organisation oversight, but 95% of ICBS from DAVs.

_________________________ 10 Findings from BP’s 6 monthly Social Report – Integrated Social Programme, October 2010 - April 2011. Findings of the April 2010-October 2010 have also been reviewed however they are not

included here because it was at the start of the ISP2 programme and findings framed more around ISP1. 11 EPII recognises that in-migration and allocation of job opportunity benefits to outsiders was a major risk and negative impact perceived by local communities at the time the ESIA was being undertaken and the LARAP produced. The mitigation measures to manage in-migration was central to BP’s Diversified Growth Strategy which helped achieve the LARAP objectives and contribute to general community acceptance during the construction phase. The transition to operation means there is less need for managing in-migration. The Bintuni Regency government has clearly stated they will follow national government policy in relation to any control of in-migration in the current circumstances. If there is any expansion to the Project facilities that results in job creation, efforts to manage in-migration will likely be needed and this issue will require more monitoring effort. 12 This finding will be verified during future EPII monitoring visits in relation to other villages that were not visited in this visit.


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ISP2 objectives ISP2 desired outcomes E.g. key bi-annual monitoring report EPII comment on monitoring verification / programme outcome findings findings10

socio-economic development process and security management of the Project (ICBS).

socialization by BP’s Security Team Incorporation with Fakfak Local Polices, 1807 villagers from DAVs and Indirectly Affected Villages (IAVs) attended.

Improved communication and collaboration with local stakeholders to promote the stable operation of Tangguh LNG.

Regular meetings between Tangguh Community Relations Team with community leaders in

EPII found that many of the ISP staff have been with the Program for a number of years. There were solid relationships with a range of community members in all the

villages (evidenced with photographs). communities EPII visited. Some ISP staff are from the villages.

Improved awareness of local stakeholders of benefits of the Tangguh LNG presence.

No reference in monitoring report. The media were present at EPII’s and BP’s meetings with Bintuni government staff and an article was printed.

C&EA Objective: Promotion of mutual respect and constructive relationship between Tangguh LNG and its local stakeholders in West Papua.

Revitalized local cultural values

No reference in monitoring report. In Saengga the Adat (indigenous) representative reported that there had been a recent programme to develop a traditional singing and dancing group. BP showed EPII some example copies of children’s books they were publishing in 2012 to depict Adat folklore. They had not been specifically identified in the 2011 activit

of tribal groups in DAVs.

ies but could be a key achievement for 2012 depending upon how they are disseminated and used..

Added value to existing livelihoods through production process improvemen

Delivered 141 tonnes agriculture and fishery product from Arguni, Tanah Merah, Babo and Bintuni stocking points to Tangguh LNG caterin

The agriculture co-op activities are clearly changing people lives. The last 18 months has been a high growth period. The co-ops records show significant increases in products sold and tonnes purchased. Evidence was seen of satisfaction with agricultural capacity building done by BP’s cooperatives and agricultural mentoring and the increased agricultural production in last 18 months, e.g. the Tofoi village co-op produced 2 products in 2010 but 34 products in 2011. Recent challeng

g. Vegetables, fruits and fish delivery to BP from DAVs increased

t and product development. from 116,036 kg in 2009 to

141,791 kg in 2010. es reported a reduced demand from BP caterers meaning some

products rotted

Diversified household livelihoods by family members especially women.

Delivered 6 farmers from Babo, Tomu, Ekam and Taroy in participation agricultural training at Agricultural Training Center (KPPT) Salatiga, of which two were women.

In Tofoi village it is mainly women who are involved in the agricultural programme. Focus in villages has been on agriculture and the fisheries and livestock programmes are in their infancy. Greater communication is needed for the livestock programme as there is confusion amongst some villagers (e.g. KK of Onar Lamu) who think they will be able to sell beef to BP (which they cannot due to lack of food hygiene certification). Some women are benefiting from sewing classes but it is anticipated that because of the low cost of clothing the skills may not have a market although women like the classes and can use the skills for the household requirement.

Livelihood objective: Improving capacity of households in local community to create diversified and sustainable income sources, and empowerment of indigenous Papuan contractors to be competitive

Improved access of local community and indigenous Papuan contractors to economic resources

Conducted mentoring session for cooperatives and saving - loan business group (UBSP) in Otoweri, Tomage, Onar, Taroy and Sebyar Rejosari. Conducted training on business

Tofoi village cooperative was very grateful for assistance with capacity building, but desired more help with financial management and credit. BP does advise co-op members to join credit union, who noted a vast improvement in loan repayment rates in past 18 months and an increase in borrowing. All villages expressed a


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ISP2 objectives ISP2 desired outcomes E.g. key bi-annual monitoring report EPII comment on monitoring verification / programme outcome findings findings10

including market, financial services, and business related information.

processes for 22 local businesses people, of which two were women and three were indigenous Papuan.

desire for employment opportunities through the expansion of the Project (Trains 3 and 4).

Reduced incidence of malaria, diarrhoea, HIV/AIDS, TB in DAVs.

Held malaria education in Tomu, Ekam, Taroy, Arandai and Babo, 277 locals a

Taroy village health workers confirmed that they had received training in diarrhoea ttended.

Case Fatality Rate (CFR) of diarrhoea fell from 3.9% in 2009 to 0.7% in 2010.

prevention and evidence of the malaria and TB programmes was witnessed.

Improved quality of mother and child health in DAVs.

In collaboration with local government of Bintuni conducted family planning campaign in Babo, Tanah Merah, Saengga, Weriagar and Mogotira, 187 locals attended.

In Taroy village MCC was providing support to the local midwife and Posyandu (nationwide government programme of maternal clinics) in nutrition and weight scaling of babies and in Tanah Merah Baru (TMB) food supplements were reported and appreciated.

Improved quality and access of clean water and improved awareness and practices regarding environmental sanitation.

Conducted education training on maintenance of rain water collection facilities in Tanah Merah, 5 households participated.

EPII saw evidence of rain water harvesting tankers provided by BP in the households of many villages. BP will need to be careful to ensure that the provision of such benefits is equitable between local villages so as to avoid jealousy and conflict. In Taroy village BP had drilled wells but the water quality was not sufficient, so BP has provided rain water harvesting assistance and infrastructure following a request from the community.

Health objective: Supporting local government and local community to improve health quality and accessibility of health services.

Improved accessibility and Mediatama Ciptacitra (MCC) was signed a 3-year contract to provide community health programs and technical assistance to the

quality of primary health service providers. local Bintuni

government to improve its health services, especially in the DAV areas.

MCC’s presence was seen in Taroy village which had recently had a health incidence related to diarrhoea, but not so much in the other villages. KK of Taroy Village stated that he was happy with the health programme and community members had been trained as ’cadres’ in basic health. MCC was also evidenced in Bintuni Town where they’re aligned with local government and BP’s medical staff to provide capacity building in primary health.

Full implementation of national education system by local government.

Conducted teacher training on mathematics and Bahasa Indonesia, 91 teachers attended.

At local level, satisfaction with teacher capacity building of BPs partner, British Council (BC), however unsustainable situation of dependency on BP honorarium paying teachers salaries – EPII recommends that BP no longer does this and instead helps facilitate teacher registration with government who should pay teachers. BP has a Memorandum of Understanding (MoU) with Bintuni Regency Department of Education (DoE). DoE expressed satisfaction with education programme and capacity building, with key benefits being improved pass rates, improved administrative capacity and model Sampoerna Foundation School.

Improved attendance of school age children to available education institution.

Provided financial assistance for uniforms, text books and other expenses for a total of 604 students from DAVs through CAPs and Dimaga programs, of which 260 were female. High school student pass rate in Teluk Bintuni increased from 65.92% in 2009 to 89.95% in 2010.

Primary pass rates improvement reported in Tofoi village where 90% passed national exams in 2009, and it is now closer to 100%.

Education and Training objective: Supporting local government and local community efforts to achieve an educated and skilled local population.

Availability of skilled local workforce espe

Completed literacy training in Tofoi. Improved educational performance demonstrates increase in local skills base. Also, the Saengga Village KK explained that in cially 2009 villagers were taken to Jakarta for


18


19


ISP2 objectives ISP2 desired ou cot mes E.g. key bi- annual monitoring report findings10

EPII comment o nitoring verification / progr outc gs n mo amme ome findin

indigenous people and women.

generator mainte an 1 the o g nance training, however in 2010 d 201 nly traininprovided related t co agri ulture and fisheries.


3. LARAP Close-out Review

3.1 Overview

The Project has had ongoing Land Acquisition and Resettlement Action Plan (LARAP) activities for over a decade. Initial negotiations with affected people and communities began

art of the AMDAL. Physical relocation of 127 households in Tanah Merah Lama (lama means old) to

RAP

f luding the 2009 socio-economic survey census and livelihood study

conducted by the Pusat Studi Kependudukan dan Kebjakan (PSKK) of Gajah Mada University

With regards to LARAP implementation, EPI found in March 2010 that: The LARAP objectives went beyond the compliance requirements of Asian Development

Bank (ADB), World Bank and International Finance Cooperation (IFC), all of which required efforts to improve or at least restore the incomes and standards of living of affected people (APs).

Most of the LARAP activities were either completed on time, or almost on time which they considered a significant achievement in the complex operating environment.

The lack of a basic record keeping system to provide data on relocated and host families against the LARAP implementation schedule and budget limited their audits to fully assess indicators.

The comprehensive entitlement matrix included cash and in-kind compensation as well as transitional support, and it recognised both the formal land tenure system of Indonesia and traditional adat rights to land and marine resources. Secure title for house plots and agricultural land was provided.

The Project made efforts to protect and preserve a number of significant elements that are part of the local cultural heritage and are spiritually significant to the Resettlement Affected villages (RAVs).

The resettled communities - Tanah Merah Baru (TMB) and Onar Baru (OB) and their hosts - Saengga and Onar Lama (OL) enjoyed a significantly better standard of housing and household services than before resettlement.

The engagement of Mayri Cooperative based in TMB to help subsidise and manage fuel payment was important for ensuring continued power and water service provision however

ility of utility provision and whether communities would be sufficiently willing and able to pay for use were identified as concerns.

Although fewer than expected households were participating, the agriculture programs had taken off in the RAVs and had been generally successful.

in 1999. In 2002 the Government of Indonesia (GoI) approved the LARAP as p

Tanah Merah Baru (baru means new) and Onar Baru began in 2004. Updating the LAand its implementation occurred simultaneously. The revised LARAP dated July 2006 was theguiding document for planning and monitoring resettlement.

3.2 Outstanding Issues from EP1 LARAP Close Out Review

Internal and external LARAP monitoring was carried out between 2001 and 2009. From 2007 to 2009, EPI was tasked with undertaking six monthly visits to carry out performance monitoring of resettlement objectives as well as environmental and social objectives. EPI’s last monitoring report of 2009 was based on site visits to the resettled villages and review odocumentation, inc

(UGM). The UGM 2009 study provided a comparison of livelihoods before and after resettlement.

the long term viab


20


21


In addition to the above, EPI identified 14 remedial ac rch and August 2009 to meet the LARA itments in order for LA d completed. As part of its sco red to asse com dial actions. BP reported o nd closure of the 14 remedial adated O l 2011.

3.3 ose Out Review

The finding ou overleaf.

3.4 Conclus ns EPII LARAP Close Review

Based on nnel and community stake mmendatiopresented ds that the resettled villages n d RAVs) and that ISP2 continu ouring socontext. As a mean story, BP could consider gathering a written format. As approp ced as part of the ISP2 cultural do arly to other settlement ncy on Bvillage jealou

tions in Mantation to be deemepletion of the remections in their six monthly ISP report,

nted in Table 3.1

P commpe, EPII was requi

n progress ar 2010 to Apri

Findings of EPII LARAP Cl

s of the LARAP close-

RAP implemess the

t review are prese

ctobe

io of

the main findings of Table 3.1holders, EPII conside

in Table 3.1 should be ado longer be identified

es with its integration apps of providing clo

story from each of the reloriate, a compendium of the relcumentation activities. Treatis in the area is considere

sies.

Out

with project persosed out. The reco

is, no longer callert of the neighb

nise their unique hirecorded or

uld be produsettled villages simil

ende

and discussions rs the LARAP to be clo

dressed through ISP2. EPII recommenas such (that

roach where they are pasure and to recog

cated families in ocation stories co

ng the previously red necessary to minimise dep

ns

cietal

P and inter-

Figure 3.1: Church in Onar Baru (new resettlement) village – EPII’s focus group discussions rev ealedthat residents rated t eligious structures (churches and mos s) as the best infrastructural he new r quebenefit of being resettled.

Source: EPII Site Visit


T 3.1: EPII Review of LARAP Remedial Aable ction Completion No. EP1Corrective Action Requirement EPII review findings Closure Status Recommendations

1 Dimaga Foundation13 (DF) Management: Constitute a new board of management with increased representation from the beneficiary groups, and an independent board member with relevant experience.

DF appears to be struggling in that community members know little about it, and the impact on the ground appears to be minimal even though there are three full time implementers. Management weaknesses are that the three clan facilitators do not know how the budget is decided, and they were not paid on time for several months in 2011.

Closed out: DF is a registered foundation and its management structure includes a four

Through the ISP2 programme, additional BP resources are

member Board, a four member Executive, and needed in 2012 and beyond to implementers. Sowai, Wayuri and Simuna clan improve and ensure the representatives to act as implementers were Foundation is functioning identified in July 2008, August 2010 and August 2010 respectively. Taking into account the limited capacity to direct such a fund and the perceived limited impact, the EPII considers the current involvement of clan members as focal points for implementation to be acceptable.

appropriately.

2 Dimaga Foundation (DF) financial advisor: appoint an independent financial advisor to provide investment advice

BP has indicated willingness to move to an independent financial advisor (which will be a cost) when DF representatives have a good understanding of the capital market.

Closed out: BP has identified the new Corporate finance Officer (CFO, who will be appointed in January 2012) as the person who will provide financial advice to the DF. EPII believes that a BP CFO will be able to provid

Ensure the CFO has the appropriate training and support to perform his/her role which should be part of the position’s TORs.

e sufficient financial advice and could possibly have more incentive to ensure the DF is financially stable than an external advisor.

Dimaga Foundation (DF) Closed out: In 2011, the DF invested in US$ BP indicated in July 2011 that they were considering splitting the deposit currency into US

Through the ISP2 programme, the 3 investment strategy: incorporate $

and Rp. while still ensuring the safest investmeinflation-adjusted growth into capital base. Boost net returns to 3-5 percent per annum.

nt for DF funds. They are waiting for the new CFO to make the changes.

deposit which dropped from 3% to 2% return, investments strategy should be but is up from a previous 0.5% return. Based on reviewed and if necessary revised the current investment climate and international annually. economic conditions, this low risk investment is deemed the most appropriate at this time.

_________________________ 13 DF is an ongoing endowment fund established as a benefit-sharing scheme for discretionary consumption purposes. To provide the intended benefits to clans that were previously affected, it is

now considered as a part of the ISP2 activities and needs to be treated as an ongoing development activity with a long term perspective.


22


EP1Corrective Action Requirement EPII review findings Closure Status Recommendations No.

4 Public utilities repairs: of the repair the generator system (genset) at Onar Lama (OL) and agree on a plan for future maintenance with OL residents.

The electricity supply in Onar Baru (OB). TMB and Saengga is being managed by the Mayri Cooperative which has two trained operators who have indicated that they have learned to manage the genset. Community members indicate they are receiving between 4 and 6 hours of electricity nightly. BP helps with the maintenance in the OB.

Closed out: BP fixed the diesel generator in 2010. The genset was part of the handover from BP to OL. The system was functioning during the EPII site visit in November 2011.

None.

5 Rationalisation of photovoltaic (PV) solar technology

Due to time constraints, EPII was not able to visit the PV system, however BP and community members stated that it is fenced off and not a safety hazard. The village leaders have yet to decide whether to try and use the equipment, or to dismantle it.

Closed out: The deactivated solar system has been handed over to the community and/or local government.

If the village and/or local government wants the equipment dismantled, BP should be responsible for doing so as they initially provided it and have the capability and technology.

6 Public utilities review: to identify cost-effective system improvements, appropriate and sustainable technologies; and back-up arrangements.

The Project had a commitment to build 2 unit water wells in Tanah Merah Baru (TMB). Due to community electricity constraints only 1 unit was drilled and through consultation, the TMB community opted for a rainwater harvesting system instead of the other unity. Water tanks have been installed in each house and public facilities. OB’s water system is working as planned and was rated by a sample of the community as “very good” quality. Key challenge in relation to electricity provisions is funding for genset fuel which is increasingly expensive. BP has been providing community planning funds for a range of priorities including fuel. BP has agreed in 2011 to subsidize electricity until October 2012.

Closed out: TMB, Saengga and OB have functioning water and electricity systems which are comparable or better than other communities of a similar size in the Project vicinity.

None.


23


EP1Corrective Action Requirement EPII review findings Closure Status Recommendations No.

7 Socialisation on electricity payments: to raise awareness of the likely introduction of electricity payments to national utilities.

In 2010, BP hosted socialisation meetings regarding the potential need to pay for electricity. It is EPII’s opinion that it is not appropriate to undertake any further socialisations on this issue until there are more concrete details regarding the potential level of payment.

Closed out: community members and village leaders confirmed that socialisation had take

BP should manage any public n

place and they had awareness that they will likely need to pay for electricity in the future.

commentary about electricity payments sensitively and in a timely fashion14 to prevent misinformation being spread which could undermine the process of setting up payment systems.

BP has been monitoring and supporting Mayri Cooperative in TMB. In OB, BP still does the routine maintenance which the Mayri Cooperative does in TMB.

Closed out: there has been close cooperatioMonitoring progress in n between BP and Mayri Cooperative regarding

Monitoring of Mayri Cooperative needs to be formalised in the ISP2

8 cooperative performance in

2012 plan. utilities management the management of the electricity system.

9 Handover to the communities: conduct consultations with RAVs for permitting requirements and establish rules and regulations for use prior to signing the Handover Agreements.

Final agreements for handover were completed for TMB in December 2008, Saengga in Novem

Closed out: evidenced by the handover BP seems aware of the delicate

ber 2009, and OB in October 2010. The repair and handover process required ongoing communication and negotiation between BP and the villages. All handovers were signed in the presence of a full range of stakeholders including the Bupati, BP Migas, clan representatives and local leaders.

agreements balance of providing direct assistance and continued dependency on them. BP may wish to assess whether providing or facilitating house maintenance training would be useful.

10 RAV repairs: Complete the agreed list of repairs for all RAVs.

The minutes of the meeting about the completion Closed out: evidence by the minutes of the meeting abo

of renovations of public facilities were signed for TMB, Saengga and OB in May

As above. ut the completion of renovations of

2011 in the public facilities. presence of a full range of local stakeholders.

Address apparent decline in Closed out: The UGM 2009 study showed that OB and OL appear to have received less attention More ISP2 presence is needed in OL. Activities sh

11 incomes: Examine and formulate actions to address apparent decline of incomes in OB and OL, and loss of trading and small business activities, since the 2001/2 Census. This is to improve incomes and livelihoods in line with the LARAP objectives.

and programming than TMB and Saengga. Two new studies, namely a socio-economic and livelihood survey and a fisheries and marine survey have begun and will begin in the first quarter of 2012 respectively. These should assist in reviewing the current livelihood status of households in the OL and OB.

livelihoods had been restored. Under ISP2, an ould be clearly agriculture program began in OB during the last identified in the ISP2 2012 plan. quarter of 2011 whereby 25 community members are planting 300 banana trees and the harvest of their first crops of selected vegetables to be purchased by the Bintuni stocking point will soon occur. Hearty varieties that will withstand transport have been selected. The agriculture intervention may

_________________________ 14 If subsidies are to end the last quarter of 2012, then there needs to be discussions with sufficient time for communities to adjust.


24

301802/PWR/

Tanggu

GEV/01/D 27th February 2012

25

h LNG Project E&S External Panel II (2011-2016)

No. EP1Corrective Action Requirement EPII review findings Closure Status Reco dations mmen

c B hs pontinue in O for six mont and ossibly m te on eore. This in rvention is c sider d late in s ut . cheduling b satisfactory

12 Livelihood diversification towards livestock: formulate a plan for the introduction of livestock for agricultural development.

Saengga has about six cows and OL has eight which are being reared for their meat provision and are not used for milk. OL villagers stated that CAPs had been used to get two cows and a DF implementer indicated they had funded two cows in OL. An OL village leader suggested that the Tangguh caterers who are purchasing vegetables and fruit would purchase their beef also – this understanding is inaccurate because appropriate food hygiene certification is not held by the villagers.

C Bo a L losed out: th Saengga nd O have cattle. BP staff believe o cs emphasis n agri ulture p e y erovides mor food securit and liv lihood in it oc ccome benef s than livest k, whi h has not tr e th oaditionally b en reared in e regi n. EPII considers this current approa pch ap ropriate.

BP sh learly co ould c mmunicatethe po l be k tentia nefits of livestocprogr s and the amme markets availa ensure th s ble to at villagerare w rmed abo od ell info ut livelihodivers on choiceificati s and risk before they commit to livestock rearing.

13 Prawn and fish product certification assistance: BP to facilitate this process.

BP staff indicated the cooperative’s current emphasis is on fresh products, rather than products that need certification. BP has indicated that if the cooperative decides to pursue certification, it will support such an initiative.

C B th ulosed out: Ps says that is req irement is not appropriate at present as ic certif ation is not a he es f priority for t cooperativ . EPII inds this e atxplanation s isfactory.

The capacity to imple ment andbenefits from certifica be tion couldconsidered during the ISP2 midterm review.

14 Investigation into apparent decline in fish and prawn incomes: since 2001/2; address reasons.

The 2009 fisheries and marine survey found that fish and prawn stocks had actually increased since the baseline study.

C as by islosed out: evidenced the f h survey results.

Some community members should be involved in ongoing measurement of fish and prawnstocks. Results of the ould study shbe fed back to the co to mmunitiescontribute to reality-based perceptions.

/GE h February 2012

26


301802/PWR V/01/D 27t

4.1 Overview

This section presents findi n-compli nt, the key obje is the identif on of ance with the Project rs’ requirements. ssment and t gorisaas the result m comm ’s lingne lit ress non-complian are presented in the sub-sections below.

4.2 Approach to Non-Comp ent

All of the information and e ered from site visit activities and infosources has se non-complian with requirements. f NC ce : 1. “Level 1 eafter as NC1] any fa y with, or a

omission ch is inconsistent with, an n al Requirement, but which failure, ac , is ons e a ve S N Complia ; and

2. “Level 2 [hereafter referred to as r

omission ch is inco quirem but which failure, actio , or omission n with any other one or m

a. Has re

material and Constitutes o for the purposes of and a ination of Significant Impacts (BAPEDAL Decree No. KEP-056/1994); Has re or is reasonably likely to result in material damage or hamaterial and s, livelihood, ity of lif lt afety, securit ffected peoHas re kel sal to grant, an iimplem onlconse sation i uired for im gguh

pply these definitions as literally as possible, presenting s evidence is not clear-cut and pro onal

s been clearly explained and justified with rere NCs h entif corrective actions (CAs) have been

ss them. When propo s, EPII has triecosts and straints fac red ge i

ce o nd whe prop nce indicators (K th ss.

4. Non-Compliance (NC) Assessment

ngs of the nos where the Project is nch to the assedations and

ance assessmeot in compli

he cateents on BP

ctive of which/Lende

EPII as well y to add

icati The app

s, recomces

been u The followin

[herwhition

whin

ore su

sulted i

s define

sulted i

y, prosulted i

y apentati

nt, perm

eavoured to asuppo

s bee

d to addren of s, likelih

PIs)

b.

c.

d.

EPII has endconcjudgemargurecommeconscircum

arearoaen

tions used byss and abi wil

liance (NC) Assessm

the

are defined in the Project finan

means

vidence gath

g two levels o

rred to

rmation Project agreements

ny action or

d by EPII to identify areas of

refe

ce (NC)

ilure to comply Enviro mental and Soci

titut Le

any failure to compvironmental and Soci

ither on its oission(s)):

y to result in ment;

nstitute a “sicree Concerning

or om

ch failure(s), action

n or is reaadverse imr is red in the Indon

n adverse im

pern or is reaproon of the Tangguh E&S Project (but

it or other authorit at that ti

rted withn used, this ha

at c

E&S Projec

lusionent ha

ments. Whende

ideratiostan

sion does not c

NC2] meansnsistent with, any En

(considered e(s) or om

sonably likelpact on, the environmbly likely to co

esian De

l 2 E&

wn or in conj

aterial dam

gnificant imGuideli

on

ly with, or anal Re

unctio

age or harm

pact”nes for the Dete

nce”

y action oent,

to, or a

rmasona

rm to, or a h, spact on, the live

r cultural heritage of asonably li

nsent, perm

me).”

qualple; or

vocation of, oorisation req

y to the extent that such approval, plem

e, hea

r the refuuired for the

entation of the Tan

ty o

val, coy to result in the re

t or other auth

s req

evidence. Where

ave been id

conof effectiveness of be used to measure

fessiasoned

ctical with n rforma

ied, sing CA

ed by BP, actual or pCAs a

succe

d to be praicted chan

riate, key peod an

re ap


27


4.3 Non Compliance Assessment Findings

4.3.1 Overview ding

m Tab be II el on o m

b .1 vel 1 Non-C ce ec me

of Fin s

, EP

lian

As

Ta

sum

le 4

aris

:

ed in

Le

le 4.1 low

omp

identified: Five lev

s Identified and R

1 n

om

compliances (NC1); and Zero level 2 n

nded Corrective Actions

n co pliances (NC2).

No. Topic Project Requirement D ipescr tion of NC1 Evidence Recommended C ctive Action (CA) orre

1 Wastewater discharge RPL , R p62 KL p16 and 27. states that during operation, sewage water will be discharged to the sea at the Common outfall at -13m.

Wastewater from Sewage Treatment Plants (STP) A, B and C is, and has b dieen, scharged at the construction je retty a a. An unlicensed temporary d rgischa e line built for the construction p ishase still in use to release overflow fr heom t -13m LAT discharge line.

BP presentat letterions, to MoE from Ap 11, siril 20 te visit.

BP has progresse installation of new d withsewage water disc e line. CA is to hargcomplete current support line to plans to laythe -13m outfall an ut the temporary line d shas soon as possible.

2 Environmental monitoring exceedances

Compliance with Indonesian l n. egislatio

A b num er of parameters monitored both in jec Pro t discharges and in the ambient environment at several locations for several monitoring periods, exceed Indonesian limits; some comply for less than 90% of the measurements.

Internal and external monitoring results. See examples below.

Each exceedance to be flagged as a non conformance in the EMS and action taken to remedy. Improvement to temporary Waste Water Treatmen TP). Rerouting of t Plant (WWeffluents for additi reatment if required. onal t

3 Sediment monitoring Seawater monitoring should include sediment monitoring for total hydrocarbon and benthos (RPL p24, 57).

Six-monthly monitoring for Benthos and total hydrocarbons is required in the RPL but in practice only occasional monitoring is taking place.

TIAP, Environmental Baseline Survey, Study on Sustainable Fishery, At Bintuni Bay, West Papua.

Review monitoring reporting programme. and

4 Flora and fauna surveys

Flora and fauna to be monitored twice during construction and every two years during operation (RPL p94).

One of the required construction phase surveys has been delayed.

Correspondence with BP. Carry out missing (currently being surveyundertaken) an with operation d complyphase schedule. Implement recommendations from previous surveys.

5 C grievommunity ance mechanism

Numerous references in RPL ISP2 pp.44,45.

Grievance responses not meeting 14 day target.

Community member comments, grievance log showing that four grievances had not been responded to within 14 days.

Improve response revise system to log time,grievances and requests communityseparately, change title of feedback card.


4.3.2 Level 1 Non Compliances (NC1) & Recommended Corrective Actions (CA)

4 Overview

The NC1 ntified and co ctive actio ded s b as stat I its w mitment to addressing all of these NC1s through the c tive action p will lenders i 2. EPII will review the ade y and f these audit in November 2012.

4 Wastewater Discharge

The Project has experienced prob ater line discharging at the permitted location, 13m deep (13m below t st Astr AT) nd of the LNG jetty. Overflow / feedback occurs at a vent in the line comin B a was not part of the original design to k , the lines built to discharge at the 13m location seem to b e. A lt, BP n phase and discharging at the tion je w is has been happening since the construction phase, the M he problem in April 2011. Commitmen e to ll of

een built e installed on time. EPII established and communicated to MoE and the Lenders, and that

ance

nitoring, but we note that internal monitoring also identifies exceedance.

esults - Exceedance

.3.2.1

s ideelow. BP h

rreed to EPI

ns recommenillingness and com

are discussed in more detail in the sub-section

orrec lans whichquac

be reported to effectiveness o

n the six monthly report to be issued in July 201corrective actions as part of its second annual

.3.2.2

lems with the wastewhe Lowe onomical Tide or L near the e

g from the Areas A,eep these STPs

nd C Sewage Treatment Plants (STP). As it

e inappropriat s a resu has been using a temporary line, built for the constructioconstruc tty, to avoid the overflo . Such discharge is not permitted; although th

oE was only made aware of tt was mad MoE to build and insta a new line to the -13m location before the end

but that it may not b2011. We understand from BP that the line has brecommends that a realistic deadline iseffort is made to solve the issue swiftly. Information noted indicates that BP acknowledges this issue needs to be addressed and EPII considers that BP is progressing with action to address this NC. Confirmation of compliance will be provided in the next audit report.

4.3.2.3 Environmental Monitoring Exceedance

Most monitoring results, internal and external, are in compliance with the relevant Indonesian standards or assessment criteria adopted for Tangguh LNG. Notwithstanding the above comments on monitoring results accuracy / reliability, the Tangguh LNG facilities are overall considered to be able to operate in compliwith the regulations. There are however a number of occasional breaches, some of which are imputable tothe project, as discussed in Table 2.1. Due to the amount of data to process, the table below only relates to external mo

Table 4.2: Environmental Monitoring RParameter Media Date and Location of

exceedance Significance / comment

NOX emissions Air GT1, 13/07/11 One-off, not considered a significant issue.

NOX emissions Air Diesel generators Step 3 Zone A, B and C, August 2011

Consistent exceedance across several measurements and three generators.

Sulphide Groundwater Wells 16, 22, 23 and 24, First exceedance. More information required to


August 2011 understand if this is a significant issue and its causes.

Zinc Groundwater Well 20, April and As above. High TSS in monitor wells suggests they have August 2011 not been constructed properly

Mercury Groundwater Wells 6 and 10 (old First exceedance. More information required to organic waste pit) understand if this is a significant issue and its causes.

Turbidity Seawater All monitoring points and Believed to be naturally occurring. Ambient monitoring

28


Parameter Media Date and Location of Significance / comment exceedance dates should be carried out to demonstrate it.

Nitrate Seawater June 2011 and numerous previous exceedances

Phosphate Seawater Most points and monitoring locations

This tends to indicate pollution by fertiliser (potentially at the WWTP, which has now been discontinued) or agricultural run off. BP should investigate the potential source of pollution.

Zinc Seawater Before outfall, September 2010

BP should check measurements against tides, as the definitions of monitoring points “before” and “after” outfall can be misleading.

Total coliform Seawater Before outfall December As above. This could indicate insufficient treatment of


bacteria 2010 sanitary wastewater.

BOD and TSS Sewage Zone A, C and Exceedance due to project activities. Permanent, June 2011

BOD Sewage Zone C, June 2011 As above

BOD and TSS Brine Thermal desalination Note that TSS are naturally high in the seawater. outlet, June 2011

Oil and Grease Sewage Zone C, January 2011 Exceedance due to project activities.

pH Sewage Zone A, November 2011 Exceedance due to project activities. Less than 90% compliance since October 2009.

Arsenic Sediments Roabiba 2A and B, 12a Unlikely to be due to Project activities but should be and B, 2011 highlighted for baseline.

Source: BP, External Monitoring 2011, Trends

Although the Indonesian legislation does not allow for any exceedance, it is understood from BP that when carrying out ‘PROPER’ audits, the MoE considers that a standard is met if the monitored values complies with the numerical limits 90% of the time. EPII recognises that further clarifications should be sought from MoE to use this guideline as a real compliance assessment tool (including what frequency of monitoring this applies to, how very high peaks of pollution are dealt with etc.). However, BP has calculated the percentage of compliance with wastewater discharge standards since the beginning of operation, and this, in combination with the comments in the table above, provides an indicator of the significance of the issue. Again, most parameters are in compliance for more than 90% of the time, but a few do not reach that threshold. As internal monitoring is carried out more frequently, EPII recommends that a similar assessment is carried out; this will have a hi and the use of a percentile will be more

II n that the Project is having a

gher statistical valuejustified.

4.3.2.4 Sediment Monitoring

Based on the RPL, seawater monitoring should include six-monthly sediment monitoring for benthos. Six monthly sediment monitoring has been carried out but without benthos monitoring. This falls short of the six-monthly requirement of the AMDAL, despite its inclusion in BP’s monitoring procedures, and EPrecommends that the procedure is followed. Although there is no indicatiosignificant impact on sediment quality (see section 4.3.2.3), current practice is not in line with permit and internal procedure requirements and this has therefore been raised as a Level 1 non-compliance.

29


4.3.2.5 Flora and Fauna Surveys

Flora and fauna surveys were meant to be carried out twice during construction phase and every three years during operation. In addition to the 2008 survey mentioned above, BP has commissioned a survey

etter mpacts. Recommendations from the 2008 study

mends that s much as possible.

currently being undertaken. This means that one of the construction phase studies has not been undertaken. EPII recommends that, where possible, similar transects are surveyed in order to allow bassessment of the fauna and flora evolution and project ishould also be reassessed and followed through where not yet implemented. Finally EPII recomthe survey teams study the specimens on site and release them a

Figure 4.1: Butterfly identified during the survey being undertaken whilst EPII were at site


4.3.2.6 Community Grievance Mechanism

As noted in section 2.3.1, it is an AMDAL project requirement to have a community grievance mechanism to ensure that grievances are responded to within 14 working days. EPII’s review of the grievance log identified that four grievances within 2011 had not been responded to in writing within 14 days. In additiona number of community stakeholders consulted in the field commented that they had not received responses to issues they had raised through the grievance mechanism.

This NC1 was rai

,

sed by EPII with BP during the monitoring audit site visit in November 2011 and on the 12th December EPII was informed that responses had subsequently been issued. BP provided details and tated that verbal responses were also provided before the written responses.

In addition to more rigorously reviewing the grievance log to ensure the response time targets are met, EPII

it

s

recommends more fundamental revisions to the grievance mechanism. From discussion with BP personnel appears that the reason that some responses were not provided is because there was uncertainty about


30

301802/PWR/

Tanggu

GEV/01/D 27th February 2012

31

h LNG Project E&S External Panel II (2011-2016)

how to respond as some o the issues raise comm e ect performance. EPII found that many issu d thro evance ca ests for community developmen stan r queri ex t things suoppo ). BP should differentiate be se t

A grievan as an a tual ved A be raised by ithin communities

Grievan ct performan ge Neg n , a ); Dan ealth and ety or the environment; Failure of the compa ntractors and their workers or d w standards or legal

obligations; Harassment of any nature; Criminal activity; Improp duct or cal behaviour; Finan practice o impropriety ud; and Attempts to conceal any of the above.

Proje e m nisms offer co nies and affected unitiedisp ce gal or a rative sy blic o ms). Informal mean wee the two part s always a preliminary

In compa nity developmen an unities and a dono to eement on what is need rally comm uld not be identified as grievances in the traditional sense of project grievan s that a g for “c plaints” in community development process can u d i g to long term commu ce by focusing on short term desires and frustrat related to taking on new s and responsibilities.

EPII commen enne ary criti n ak er engage r, EPII strongly sug rformance grie s the natural feedback and comm d for the life cycle of community developm d comm aints) form is ne vance me nism and feedba ed king into idthe Proje ion

EPII will review the functio sm du sequent visits. In parti ( y r v se and 20 d rievances and the way grievances are categorised will be reviewed. BP has communicated to EPII its willingness to e re that target response times are met in the future. In July ssued to lenders, EPII expects BP to report that all grievan regi ave be re nded r ce with the target respon

.

_________________ __ 15BP had a separa ievan y from its project

per e ism

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5. Additional Improvement Areas & Recommendations

5 f Imp ment Areas and Reco

Issues that could result in the Project not meeting international best practice as well as recommendations to address th Table 5.1 below.

Table 5.1: Overview of additional improvement areas and recommended actio

.1 Overview o rove mmendations

em are summarised in

ns Topic Requirement Issue Recommended actions

ENVIRONMENTAL IMPROVEMENT AREAS

Flaring (key environmental area for improvement)

Continuous flaring of gas should be avoided if feasible alternatives are available. If flaring is necessary, achieve continuous improvement of flaring through implementation of best practices and new technologies. (1).

Large quantities of gas flared compared to baseline. Elevated baseline.

Implement pollution prevention and control measures for flaring in line with international best practice. Reduce flaring. More stringent targets. Step changes.

Burma Creek Drainage Adequate drainage. Erosion, waterlog. Upgrade drainage system. Follow recommendations from external study.

Non Hazardous Waste Landfill Leachate

Free overflow to pond. Testing of leachate. Overflow to environment. Pests. Clean pipe. Monitor leachate at the pond.

Condensate tank bund Secondary containment. Consolidated with sandbags, unknown integrity Test integrity.

Waste Incinerator Emissions Emissions within standards. Incomplete combustion, smoke, dioxins Test emissions. Replace incinerator combustion system.

Composter emissions Minimise workers exposure to pollutants and bacteria / microbes.

Discharge at human height, potential for bacteria / microbe development in the woodchip bed.

Analyse gas and improve discharge. Change woodchips regularly.

Organic landfill methane emissions

Release vents. Spontaneous combustion, subsidence Vent. Consider methane recovery.

House keeping Clean site. Minor issue of solid waste (mostly outside the plant area itself) and drains.

Clear solid waste and clean drains.

Lab sp Lab slightly cramped. Better laid out facility / more spacious labace Monitoring, evaluation and reporting . requirements.


32


Topic Requirement Issue Recommended actions

Diesel generators at contractor’s camp

Site pollution sources away from receptors. Exhaust pipe and noise next to workers accommodation.

Site diesel generators further away.

Tanah Merah Baru Tar Spill No spill. Tar drums spilled, outside the perimeter fence – Remediate as soon as possible. as a gesture of BP is not directly responsible. goodwill to community and to demonstrate due

environmental concern

Portacabin removal No solid / liquid waste left. Following removal of some of the temporary Remediate / clear the area. Ensure procedure is in accommodation, foundations, contaminated soil and other materials have been left in place and

place with contractor to avoid repeat.

are waterlogged.

Continuous air emissions Reliability. Under / overestimates communicated to MoE. Supplier to provide maintenance and calibration. monitoring

Reporting of monitoring results Potential improvements. Inaccuracy and lack of ambient context. Reference to ambient; timeline of events; follow up of internal monitoring; refer to previous results.

IPSI IMPROVEMENT AREA:

Indigenous peoples cultural LARAP requirement to develop Cemeteries Perception in Onar Baru that BP is not meeting its Improve procedure on initiating contact and heritage (key IPSI improvement area)

Access and Maintenance Agreement providing access.

commitment regarding cemetery access in 2010 notifying all villagers (not just village heads) about or 2011. the visit schedule and logistics.

Community health, safety and BP’s duty of care. 2 x Electricity poles fallen over BP perimeter Regular perimeter walks to identify such hazards security fence – fixed by BP once identified by EPII. and breaches of security early on.

Agriculture Programme Livelihood diversification from fishing to Purchasing of agriculture products is misaligned Better communication to match supply and agriculture. with production. demand. Advise farmers on indicators.

Education Programme and Full implementation of national education Desired outcome will not be achieved through BC to advocate to DoE on behalf of teachers to Teacher Retention system by local government (desired

outcome in table 26 of ISP 2). ISP 2 if teachers are not retained and motivated. facilitate and speed up the registration of teachers

in the project area.

Dependency ISP2 vision change: “development for the Non-alignment of policy and language leads to Cite implementing agents more frequently. community” to “… with the community”. confusion for external stakeholders. Distinguish when BP is implementing or facilitating.

Onar Baru and Onar Lama LARAP Corrective Action. Decline in socio-economic standards leads to Increased and more frequent presence of ISP2 livelihoods increased communal anger and jealousy. programs.

Communications and external Duty of care. Local perception that stocks are decreasing Organise meetings in relevant communities to affairs misaligned with empirical findings leading to share marine and fishery study results.

unnecessary social conflict, communal anger and jealousy.


33


34


Topic Requirement Issue Recommended io act ns

Dimaga Foundation LARAP Corrective Actions for clan representation and financial advice; ISP2 C&EA indicator.

Social resentment and conflict. More transpare n cial aspects and field ncy o finanresults16.

Mayri Cooperative LARAP Corrective Action to monitor Mayri Cooperative

Lack of b tw M nrokering agreement be een ayri a d the State ommunitUtility could continue c y pressure ctricity. for BP to subsidize ele

Monitoring of M Co tion has been informal ayri operaand continual b T actions should be y BP. hese formalised in IS 01 n. P2 2 2 pla

Note

Thi

1 – Inter s c n S shore Oil Ga il 2007.

16 s area f follow ri coop ore osed to section 5 ther IPSI risks are elaborated.

national Best Practice i

_________________________

or improvement and the

onsidered to be as set out i

ing one about the May

IFC Environmental, Health, and

erative are described in m

afety Guidelines for On

detail in Table 3.1, as opp

and s Development, Apr

.3.3 where the o


5.2 Environmental Areas for Improvement and Recommendations

ar acts

ironment. The following points however, highlight the shortcomings, areas for improvement and issues identified during the visit.

to environmental impact mitigation and management relating to the quantity of gas being flared. Initial flaring quantity estimates

ere revised upwards significantly and a new permit had to be obtained from MoE. Based on the monitoring results provided, the plant is largely in compliance with these revised limits.

ilable and if flaring is necessary, continuous improvement of flaring through implementation of best practices and new technologies should

irements (ADB, JBIC or IFC standard in the Loan Agreement as liste4d in Appendix A) do not include reference to a specific flaring level but do include requirements on flaring to,

ily emissions) indicate issues with the plant’s design and operation. In addition, the baseline flaring figure itself (actual around

-Gas unt

BP acknowledges the issue and has developed a flaring reduction programme, including closing unnecessary flare lines and sources. Most of these are reported as being complete and the October 2011 results show reduced baseline flaring. Major flaring still occurred as a result of trips and start ups. The reduction programme target was initially to achieve a 5% reduction on 2011 numbers in 2012. Given the gaps between pilot flare and baseline, and between baseline and actual figures, we considered that that target could be increased. We are pleased to report that, in its latest correspondence with the MoE, BP

_________________________ 17 International best practice considered to be as set out in IFC Environmental Health and Safety Guidelines Onshore Oil and Gas

Development, April 2007 and Global Gas Flaring and Venting Reduction Voluntary Standard

5.2.1 Introduction

As a general note, the site was fond to be clean and tidy, and the staff interviewed knew their responsibilities with regard to environmental aspects, and seemed proficient in their discipline. It is clethat significant effort is made to achieve environmental compliance and to generally minimise the impon the env

5.2.2 Key Environmental Areas for Improvement

5.2.2.1 Flaring

One significant area for improvement for the Project operations is in relation

provided for the AMDAL w

However we note that flaring figures are derived from flow meters and mass balance calculations, but the actual meter at the flare is malfunctioning and should be repaired.

The new permit provides relatively lenient limits given that international best practice17 sets out that continuous flaring of gas should be avoided if feasible alternatives are ava

be demonstrated. The Project Requ

amongst others, minimize low pressure flaring and eliminate high pressure flaring if possible. There istherefore a standing requirement, which has evolved into the expression of current international best practice as noted above, to reduce/minimise flaring.

A large part of gas flaring emissions result from abnormal operations such as TAR trip, MR trip as well as planned maintenance. The figures (>170 mmscfd or up to 10 times the baseline da

13mmscfd in September 2011, 2.5 times the AMDAL estimate) is elevated. It appears that Boiler Offcompressor availability is the main contributor to “baseline” flaring (14 mmscfd). For reference, the amoof gas flared to maintain the pilot flare, which should in an ideal situation be the only source of flaring, isestimated to be 0.69 mmscfd.

301802/PWR/GEV/01/D 27th February 2012 35


committed to a flaring target of 9.7 bcf in 2012 which is significantly down from last year’s target of 17.8bcf. orward.

EPII recommends that further improvements are considered. Although outside the scope of this review, future expansion plans could be an opportunity to include measures beneficial to both existing and future facilities to reduce flaring, such as redundancy of key equipment (e.g. BOG compressor). IFC EHS Guidelines for LNG Facilities and for Onshore Oil and Gas Developments, as well as the Global Gas Flaring and Venting Reduction Voluntary Standard can be referred to for generic guidance on good practice.

In addition to waste of natural resources and emission of greenhouse gases, flaring contributes to emission of local air pollutants, especially given the uncontrolled combustion conditions and heat. Smoke noticed during the visit demonstrates incomplete combustion. Although some of these issues are inherent to flaring, EPII recommends that BP verifies that the flare combustion is being optimised.

5.2.3 Other Environmental Improvement Areas and Issues

5.2.3.1 Introduction

Since the last visit by an External Panel environmental team, the Project has moved into operation phase and most of the issues raised at the time are no longer relevant. BP commissioned an environmental assessment of the construction activities. Again, most of the findings concerning spills and waste / chemicals management are no longer relevant. The sections below discusses those issues highlighted in these two reports, which can still affect the environment during operation

5.2.3.2 Burma Creek Drainage

Significant amounts of debris and sediment were washed away into the forest at Burma Creek during m and

d been used to consolidate the path from the laydown area, slow down the stormwater flow, and create a retention basin with a basic overflow system protecting the downstream sections. Trees seem to

reviously flooded areas.

and the recommendations included looking at the laydown area, which is the main

catchment area of the discharges to Burma Creek. It is noted that a more permanent system is planned as

This is obviously a welcome step f

construction. In addition to the direct impact on the nearby ecosystem, this blocked the natural streacaused overflow. A number of trees were flooded for extended periods and died. We found that piles and soil ha

have mostly recovered and vegetation is growing in the p

Although measures have been successfully implemented to remediate the problem, these are very rudimentary and should only be temporary (see Figure 5.1). A full study was carried out in 2009 by anexternal consultant

part of the Tangguh Expansion program.



Figure 5.1: Burma Creek Drainage

5.2.3.3 Perimeter Fence and Foreshore

ess these areas during our November 2011 visit.

5.2.3.4 Ash from non-hazardous waste incinerator

ntinue to be carried out to ensure the ash would not classify as

te Landfill Leachate

ter landfill will

be closed in the near future, leachate will need to continue to be monitored at the pond and the drainage

te tank has an earth bund and that the side facing the road had been damaged by erosion and consolidated using sand bags. EPII recommends that BP makes sure the bund is

Vegetation death potentially due to drainage and dead trees in the foreshore area were reported in previous external panel reports. We have not been able to acc

Ash previously disposed of in an inappropriate manner is now reportedly sent to the inert landfill. EPII recommends that occasional tests cohazardous waste.

5.2.3.5 Non Hazardous Was

The “overflow” pipe at the inert landfill near the future helipad appeared to be clogged as there was wainside the landfill. This needs to be cleaned to allow rainwater to drain to the pond. Although this

system therefore needs to be operational.

5.2.3.6 Condensate Tank Bund

We noticed that the condensa



still capable of retaining the condensate in case of a failure of the primary containment and would not cede, leading to a major spill. In addition, erosion is still occurring around the tank, potentially threatening the

arry over from the construction phase. Although its use in reducing solid waste landfilling is acknowledged, the incinerator is not providing a clean,

aste

Gas generated by the composting process is emitted via a pipe which discharges to a bed of woodchips, on the ground, about 1.2m high, meaning final

emissions of bioaerosols occur at human height. EPII recommends workers’ exposure is reduced through the flue gas. The gas should also be analysed for pollutants, but also for flow

and general composition as it is likely to be methane and CO rich and could therefore be used as a fuel, in area. Finally, the woodchips should be regularly replaced

obial development.

Similarly, the organic landfill emits methane. As a minimum, vents need to be created on the areas already

ethane.

t. BP should look at further improvements, such as: Removal of solid waste and piles from construction activities on slopes around the plant area, on the ex-

5.2.3.12 Diesel Generators at Contractor’s Camp

rs

piping.

5.2.3.7 Waste Incinerator

The non-hazardous waste incinerator is understood to be a c

safe way of burning waste, as the simple combustion chamber is unlikely to provide efficient combustion, which leads to emission of unburned carbon (black smoke was noted during its operation), carbon monoxide and particulates as well as, potentially, dioxins and furans (in particular since some plastic wwas noticed in the waste mix during our visit. Diesel consumption adds to the plant’s GHG emissions and use of natural resources. A more efficient process is recommended and, in the meantime, waste likely to result in air pollution should not be burnt.

5.2.3.8 Composter Emissions

presumably to reduce odour. The woodchips bed is

more efficient dispersion of

supplement to the diesel genset present in that(and the old ones incinerated) to prevent micr

5.2.3.9 Organic Landfill Emissions

covered / capped to avoid methane build up, self combustion and sudden ground subsidence. In addition,BP could look at sealing the landfill to recover the m

5.2.3.10 Housekeeping

As mentioned above, the site was generally well kep

laydown area, on the beach etc. Drains to be cleaned up, ensure slope

5.2.3.11 Laboratory Space

The environmental monitoring laboratory was found to be relatively small and cramped, which affects performance and results reliability. More spacious / better laid out facilities should be provided.

Some of the generators in the camp are located in the middle of the cabins, bringing noise and air pollutionright next to the workers (and air emissions are non-compliant as established above). These generatoshould be sited further away.



5.2.3.13 Tanah Merah Baru (TMB) Tar Spill

Four drums of tar, mostly spilled onto the surrounding ground, were noticed just outside the perimeter

Through visual observation, EPII identified a waterlogged area in Tanah Merah Baru (TMB) village where and other unknown pollutants, and some other debris and

waste had been deposited. Following discussion with BP staff EPII ascertained that this area was the e foundations had

become waterlogged. The source of the pollution is not known. This poses an environmental risk of oil and c

up

Building on the successes and lessons learned of ISP1 while still reflecting real needs of the community it is serving.

mendations that s the continued successful implementation of ISP2.

5.3.2 Key IPSI Areas for Improvement

5.3.2.1 Indigenous Peoples Cemetery Access

There was a LARAP requirement to develop Cemeteries Access and Maintenance Agreement providing access on important religious days. Consultation with some residents of Onar Baru (OB) indicated that they received access to the cemetery in 2009, but not in 2010 or 2011. Tanah Marah Baru (TMB) residents communicated to EPII that access was occurring satisfactorily. This issue was raised as a potential non-compliance with BP who indicated that they did have an agreement in place which they adhered to through the implementation of a procedure in 2011 (reviewed by EPII) to notify village heads of the visit dates and transport arrangements. BP provided photographic evidence and the names of two OB residents who visited the cemetery in Easter 2011, and three OB residents who visited on Idul Adha in 2011.

The procedure states that visits are facilitated upon requests from the communities. There are five ccasions in the year where the community can visit the cemetery: Easter, Christmas, Idul Fitri, Idul Adha

and Independence Day. Because of security and access reasons, BP provides boat transport for the villagers, picking them up and dropping them off. However, the number of people who can visit at any one

fence near the village of Tanah Merah Baru. Although potentially not directly BP’s responsibility, EPII recommends that BP removes these drums as a good will gesture to the local community..

5.2.3.14 Tanah Merah Baru (TMB) Portacabin Removal

the soil appeared to be contamination with oil

former site of a temporary Project office which had recently been removed by BP and th

other pollutants migrating into the surrounding soil and water table. Also, stagnant water can pose a publihealth risk related to malaria. It is recommended that BP immediately clears all project related debris, drains the water and investigates the source, nature and extent of the pollution and takes remedial clean action to remove any potential environmental or health risks.

5.3 IPSI Areas for Improvement

5.3.1 Overview

In general terms, EPII concludes that ISP2 is: Based on sound development principles; Well resourced with BP staff and budget.

The areas for improvement and recom are discus ed overleaf are included to assist with

o



time is limited to 50 due to the limited number of boats. The community is asked to arrange who will be e limitation.

tion is ader to

way that was constructed by BP around the site perimeter to provide local residents with access to traditional fishing grounds, EPII identified that two electricity poles

e site perimeter fence. We understand that the electricity line was not charged as it connects an external facility that is not operating due to absence of government

be

e on

going in each occasion, because of th

Because of EPII’s finding, BP has committed to improve the notification procedure to ensure informaclear and transparently disclosed to all community members, rather than just relying on the village ledisseminate the information within the village. EPII commends this, and expects better disclosure of information to avoid misinformation within the community that could breed hostility if villagers think that theyare being denied access.

5.3.3 Other IPSI Risks and Issues

5.3.3.1 Manggosa Pathway Electricity Pole Hazard and breach of Site Security

When walking along the Manggosa Path

had fallen across the pathway and damaged th

approval. This nonetheless was considered to prevent a serious health and safety risk should the line made live for any reason, and if children touch the line they may think that other similar lines are not charged and this could result in electrocution. EPII drew this issue to the attention of BP who took action immediately. On the 28th November the poles were removed and the fence was repaired as evidence by Figure 5.2 and Figure 5.3. BP has stated that it is preparing a letter to the Bintuni government to agrethe follow-up action and to avoid reoccurrence of this hazardous incident, because the electricity system belongs to the Bintuni Regency Government. EPII also recommends that regular perimeter walks are undertaken by BP to identify future hazards and breaches of site security.

Figure 5.3: Fallen Electric PFigure 5.2: Fallen Electric Pole - Before ole – After remediation

Source: BP Source: BP



5.3.3.2 Agriculture Programme

During 2011, significant progress was made regarding increased agriculture production18 in various communities and the establishment of cooperatives to manage the provision of production with the demands of the Tangguh caterer. The presence of the large LNG plant workforce has created a market for fresh fruits, vegetables, fish and prawn produce. Villagers in various settlements visited were pleased with increased income available to use for boat repairs/parts (including motors), sending older students to schools outside their home village and for health costs. However, several villages noted discrepancies between production and what was purchased. Tofoi could not meet their allocated amount but TMB had some crops rotting because they had not been purchased. Establishing the correct level of contract orders is considered a teething issue for the growing program however efforts must be made to readjust quotas. In addition, the possibility of the catering company paying immediately in cash should be considered as some farmers mentioned delays in payment.

5.3.3.3 Teacher Motivation and Retention

One of the biggest challenges with achieving the ISP2 objective of full implementation of the national education system is teacher motivation and retention. It is difficult to attract, retain and get teachers to turn up to school regularly, largely because many are not officially registered by the government and therefore are not paid. This was exemplified by a teacher who was interviewed in OB who explained that of the three teachers in the village, none were registered or had received a salary since BP stopped paying their salaries in 2009. Two of these teachers have passed their exams, are qualified and they are chasing the local government Department of Education to process their registration. The teacher interviewed explained that she continued doing her job for the benefit of the children, but would soon have to stop if she did not receive a salary. This is a national problem and the Indonesian government has recognised that only 40% of teachers are currently registered and made a public commitment to register all teachers in the next two years. EPII recommends that BP and/ or its implementing partner (British Council) advocate on behalf of the teachers in the DAVs to facilitate the speeding up of the registration process.

cy

e

_________________________ 18

ted.

5.3.3.4 Dependen

BP provided a full range of data and presentations regarding the ISP activities which are managed, monitored and implemented by more than 55 staff, all Indonesian and many Papuan. The staff and resources could be considered equivalent to a local non-governmental organisation and has similar emphasis related to meeting community needs, supporting indigenous peoples, and addressing poverty reduction. The well informed staff are rightly proud of the Project ISP accomplishments to date which haveoverall been significant. However, EPII did note that there is still a high level of dependency from local communities on the Project to perform roles that are the function of the government or other social servicproviders.

Tofoy cooperative managers noted that they had increased from two products in 2010 when they started to 43 by the end of October 2011 when EPII visi



Figure 5.4: Local community members at the agricultural nursery run by BP and partners at Tofoi Village


EPII recommends that the change from ISP1 to ISP2 (“development for the community” to “development with the community”) needs to be backed up with appropriate attribution of accomplishment in its programs. BP needs to put more emphasis on the roles and responsibilities of partners, both implementing contractors and government agencies. ISP2 staff need to communicate more clearly about the activities they are directly implementing (some agriculture advisory activities) and the programs they are facilitating and supporting through partners, which is the bulk of the activities. An example is health, where BP has only two ISP2 health staff19 and their partner, MCC which is working in coordination with Department of Health, has 24 staff on the ground. If ISP2 staff were to say “we are doing…” or “we will do …” then community leaders may become confused regarding expectations and what BP can and cannot support. By placing more emphasis on implementing partners in the communication of ISP2 activities, BP will reduce community dependence on themselves and hopefully cultivate more community resilience which is required for sustainable “development with the community”.

19 age

tor

_________________________

EPII notes that a month prior to their visit, a routine visit by a BP health staff lead to his caring for three patients for which the villwas extremely grateful. However, generally such medical interventions and training are undertaken by MCC or their subcontracYayasan Santo Agustinus.



5.3.3.5 Onar Baru (OB) and Onar Lama (OL) Livelihoods

te visit

r some of the other Directly Affected Villages (DAVs). The next socio-economic study which has recently

EPII recommends that ISP2 needs to develop and clearly plan out interventions targeted for OB and OL in

ts. EPII sier to

see 20

SP iven to

ut through school programs or on

boards or presenting them orally in appropriate village gatherings. Small theatre productions could even be

20 For instance, ISP staff should be looking to ensure Onar community members get an equitable share of training opportunities. As

well, because of their concerns and perceptions related to fishing and prawn stocks, any means of involving them in collecting empirical data would be beneficial. Another option for consideration would be to do “exchanges” among agriculture and fishing cooperative members with Onar community members visiting other communities to get hands on experience and having other community cooperative members come to Onar to share their experience.

Based on EPI observations and comments about the UGM 2009 study findings as well as the siinterviews and participatory focus group activity results, OB and OL do not appear to have the same levels of community resilience as TMB and Saengga (as comparable former resettlement affected villages) o

started will provide more concrete data to know whether this impression is correct. As well, EPII recognises that having an ISP office in TMB makes that community easier to access although there is shelter for Operator staff in Onar Baru.

the 2012 ISP2 annual plan. In some cases, OL and OB are lumped in the ISP2 plan with other DAVs and it is believed that by targeting them more specifically, there should be some improved livelihood resulrecognises that not all community development interventions are always successful and it may be eaconcentrate on DAVs where interventions are showing intended results. However, EPII would like tomore focus on OB and OL livelihoods, for instance through the agriculture programme, as more attentionmay improve the results to the same extent as other communities. EPII believes such attention is warranted because of the BP’s historical commitments to the Onar communities’ livelihood restoration.

5.3.3.6 Reporting Back to the Communities

Through its ISP activities BP has collected large amounts of data. To date, it appears to EPII that Ireporting has focussed on reporting to lenders and government rather than much attention being gthose who initially provided the data and information. EPII heard of several cases where villagers were unsure about study results, for instance in regards to the marine survey and malaria testing. EPII suggests that funds may need to be budgeted in 2012 and future years to ensure feedback of results to those providing the data for the various surveys and studies. This might entail a staff member summarisingresults in easy to read one or two page documents that can be handed o

considered.

_________________________



External Panel II’s (EPII’s) first compliance monitoring audit has not identified any Level 2 Non-Compliances (NCs) with Project requirements and five Level 1 NCs. In conclusion, EPII finds the Project to be largely compliant with Project requirements and no critical or significant risks have been identified.

The Project is largely meeting its environmental and social monitoring and reporting process requirements. Some improvements have been recommended by EPII to improve the reliability and robustness of data and internal evaluations, as well as the ability of BP to track issues, identify risks early and prevent future NCs before they occur.

EPII considers the LARAP implementation requirements to be closed out. However recommendations have been made to ensure that commitments that are to be transferred across to ISP2 (for example the livelihood programmes in Onar Lama and Onar Baru) are addressed appropriately, with contextual understanding of the LARAP implementation history and issues. EPII recommends that the term of Resettlement Affected Villages (RAVs) is phased out in recognition of the completion of the handover to communities and the closure of the LARAP. Former RAVs should now be identified as part of the other Directly Affected Villages (DAVs) in order to minimise Operator dependency and inter-village jealousies. BP could consider producing a compendium of the relocated households’ stories to recognise their unique legacy as part of the ISP2 cultural documentation program.

The four environmental NCs identified relate to: wastewater discharge, environmental monitoring exceedances, sediment monitoring, and flora and fauna surveys. The one IPSI NC relates to the community grievance mechanism. All of these NCs are considered to be possible to address and EPII has provided recommendations for their corrective actions and programme improvement. In addition to the NCs, EPII has identified one key environmental risk (which could result in an NC in the future if measures are not enacted to mitigate it) in relation to flaring, and one IPSI key risk in relation to communities’ perception about entitlements to indigenous peoples’ cemetery access.

In conclusion, EPII finds that the Project’s Environmental Management System is well defined, based on international best practice and on the whole is effective in meeting Project requirements and ISO 14001 commitments. EPII concurs with the Operator’s monitoring findings that ISP2 is on track and performing effectively resulting in tangible social and community sustainable development outcomes. ISP2 is considered to be based on sound development principles; well resourced with Operator staff and budget; and building on the successes and lessons learned of ISP1 while still reflecting real needs of the community it is serving. The key challenge for the remainder of the ISP2 programme will be countering the community dependency culture that has developed under ISP1. EPII notes that the Operator recognises this, and is proactively focussing on capacity building of government and local communities in order to meet the ISP2 goal of “laying a foundation of sustainability,” by moving away from a process of “development for communities”, to a situation of “development with communities”.

EPII notes BP’s commitment to address all of the identified non-compliances and areas for improvement through corrective action planning and EPII is of the opinion that BP are willing and able to do so, thus avoiding the risk of any systemic failures in environmental and social management and monitoring.

ng Comments 6. Concludi



Appendix A. Applicable ADB inciples ________________________________ 46 and JBIC Policies and the Equator PrAppendix B. Key Document ______________________________________ 48 s Reviewed______________________Appendix C. Stakeholders Consulted______________________________________________________________ 51

Appendices



Appendix A. Applicable ADB and JBIC Policies and the Equator

iplePrinc s

Policy ADB Tranche Lender JBIC Equator Principles &

associated policies

Environment, health and Environment Policy of the JBIC Guidelines for Confirmation of Environmental and Social Considerations of April 2002 (but excluding any portion thereof relating solely to (i) the disclosure of information regarding c

The Equator Principles, June 2003. IFC Operation

safety Asian Development Bank (ADB document no. R154-02, al Policy

4.01 Environmental Assessment (October 1998) IFC Operational Policy 4.04 Natural Habitats (November 1998) IFC Operational Poli

November 2002)

onfirmation of environmental and social considerations to concerned organizations, stakeholders and other third

cy 4.09 Pest Manage

parties, and (ii) the submission to ment

(November 1998) IFC Operational Policy 4.36 Forestry (N

JBIC by concerned organizations and stakeholders of objections relating to the non-compliance of the Tangguh Project with JBIC’S stated policies) (the JBIC ovember 1998) Guidelines) IFC Operational Policy The World Bank Pollution 7.50 International Prevention and Abatement Waterways (November Handbook 1998 incorporating 1998) Industry Sector Guidelines for Oil IFC Operational Policy & Gas Development (Onshore) Note 11.03 �International Finance Management of Corporation (IFC) Operational Cultural Property Policy for Environmental (September 1986) Assessment (OP 4.01), October The World Bank 1998 Pollution Prevention IFC Environmental, Health and and Abatement Safety Guidelines for Oil and Gas Handbook 1998 Development (Offshore) incorporating Industry

Sector Guidelines for IFC Operational Policy for Natural Oil & Gas Habitats (OP 4.04), November Development 1998 (Onshore) IFC Operational Policy Note for IFC Environmental, Management of Cultural Property Health and Safety (OPN 11.03) of September 1986 Guidelines for Oil and Gas Development (Offshore)

Involuntary resettlement Involuntary Resettlement (ADB The JBIC Guidelines The Equator Principles, document no. R179-95, August June 2003. �IFC Operational Policy for

1995) Environmental Assessment (OP IFC Operational Policy 4.01), October 1998 for Environmental

Assessment (OP 4.01), �IFC Operational Policy for October 1998 Involuntary Resettlement (OP

4.30) of June 1990 IFC Operational Policy for Involuntary �IFC Operational Policy Note for Resettlement (OP Management of Cultural Property 4.30) of June 1990 (OPN 11.03) of September 1986 IFC Operational Policy Note for Management of Cultural Property



Policy ADB Tranche Lender JBIC Equator Principles & associated policies (OPN 11.03) of September 1986

Indigenous peoples

Policy on Indigenous Peoples (ADB document no. R55-98, April 1998)

The JBIC Guidelines IFC Operationa

The Eq , uator PrinciplesJune 2003. l Policy for

Environmental Assessment (OP 4.01), October 1998

IFC Operational Policy

�IFC Opefor Environmental Assessment (OP 4.01), rational Directive for

Indigeno October 1998 us Peoples (OD 4.20), September 1991 IFC Opera

IFC Operational Directive for tional Policy Note for

Management of Indigenous Peoples Cultural Property (OPN 11.03) of Se (OD 4.2 er 0), Septemb

1991 ptember 1986

IFC Oper cy ational PoliNote fo ent r Managemof Cultural Property (OPN 11.03) of September 1986

Others Public Communications Policy (March 2005)

Child and Forced Labor P ment olicy State(March 1998)



Appendix B. Key Documents Reviewed

Table B.1: key Documents Reviewed Type of Document Document Title Author Date

Integrated ANDAL Activities, ANDAL - Gas Exploitation, Gas transmission, LNG Plant, Sea Port, Airfield and Resettlement – Tangguh LNG Project

Tangguh LNG (BP and Pertamina)

October 2002

Integrated ANDAL Activities, RKL - Gas Exploitation, Gas transmission, LNG Plant, Sea Port, Airfield and Resettlement – Tangguh LNG Project


October 2002

Integrated ANDAL Activities, RPL - Gas Exploitation, Gas transmission, LNG Plant, Sea Port, Airfield and Resettlement – Tangguh LNG Project


October 2002

AMDAL / ESIA documentation

Summary Environmental Impact Assessment - Tangguh LNG Project in Indonesia

Asian Development June 2005 Bank (ADB)

BP / ADB July 2006 BP Tangguh LARAP Land Acquisition and Resettlement Action Plan

Indigenous Peoples Development Framework Integrated Social Program Unit Tangguh Liquefied Natural Gas (LNG) Project

BP / ADB July 2006

BP Tangguh Integrated Social Program [ISP1 005-2010) BP / ADB July 2006

Tangguh LNG - COMMUNITY INVESTMENT PROGRAM 2011-2015 [ISP2)

BP November 2011

Tangguh ‘How we Operate’ BP April 2010

Group Defined Practice (GDP 3.6-0001) Environmental and Social Requirements for New Access Projects, Major Projects, International Protected Area Projects and Acquisition Negotiations

BP April 2010

Group Recommended Practice (GRP 3.6-0001) Environmental and Social Recommendations for Projects

BP April 2010

Socio-economic survey 2009 (in Bahasa Indonesia) BP 2009

BP / Lenders environmental and social management documentation

Environmental Management System Manual BP May 2011

TANGGUH PROJECT – ADB TRANCHE PSC PARTIES AGREEMENT

BP / ADB July 2006

TANGGUH PROJECT – ADB TRANCHE LOAN AGREEMENT

BP / ADB July 2006

TANGGUH PROJECT – COMMERCIAL TRANCHE PSC PARTIES AGREEMENT

BP / Lenders consortium and Mizuho Bank

July 2006

TANGGUH PROJECT – COMMERCIAL TRANCHE COMMERCIAL TRANCHE LOAN AGREEMENT

BP / Lenders consortium and Mizuho Bank

July 2006

TANGGUH PROJECT – JAPANESE TRANCHE PSC PARTIES AGREEMENT

JAPAN INTERNATIONAL FINANCE MANAGEMENT (TANGGUH) CORPORATION

July 2006

Loan agreement documentation

Report and Recommendation of the President to the Board of Directors

ADB November 2005

TANGGUH INDEPENDENT ADVISORY PANEL FIRST REPORT ON OPERATIONS PHASE OF THE TANGGUH LNG PROJECT

TANGGUH INDEPENDENT ADVISORY PANEL (TIAP)

January 2011 External environmental and social monitoring documentation

Operator’s 6 Monthly Social Report Integrated Social BP / ADB Not dated



Type of Document Document Title Author Date Programme Tangguh LNG – Operations Phase

Operator’s 6 Monthly Social Report Integrated Social Programme Tangguh LNG – Operations Phase Octob

BP / ADB Not dated er

Operator’s 6 Monthly Social Report Integrated Social Programme Tangguh LNG – Operations Phase October

BP / ADB Not dated

Operator’s 6 Monthly Social Report Integrated Social BP / ADB Not dated Programme Tangguh LNG – Operations Phase October




INDONESIA: Tangguh Liquefied Natural Gas Project EP1 / ADB March 2010 Sixth Compliance Monitoring Report

INDONESIA: Tangguh Liquefied Natural Gas Project EP1 / ADB August 2010 Sixth Compliance Monitoring Report

INDONESIA: Tangguh Liquefied Natural Gas Project EP1 / ADB March 2010 Sixth Compliance Monitoring Report

BP RESPONSE TO THE SECOND TANGGUH INDEPENDENT ADVISORY PANEL FIRST REPORT ON TANGGUH LNG

BP MARCH 2011

Tangguh Operation Monthly Report January 2011 BP January 2011

Tangguh Operation Monthly Report February 2011 BP February 2011

Tangguh Operation Monthly Report March 2011 BP March 2011

Tangguh Operation Monthly Report April 2011 BP April 2011

Tangguh Operation Monthly Report May 2011 BP May 2011

Tangguh Operation Monthly Report June 2011 BP June 2011

Tangguh Operation Monthly Report July 2011 BP July 2011

Tangguh Operation Monthly Report August 2011 BP August 2011

Tangguh Operation Monthly Report September 2011 BP September 2011

Operator’s Social Report – Part One Land Acquisition and Resettlement Action Plan (LARAP) Tangguh LNG Project October 2008 - April 2009

BP / ADB Not dated

Operator’s Social Report – Part One Land Acquisition and Resettlement Action Plan (LARAP) Tangguh LNG Project April 2009 - October 2009

BP / ADB Not dated

Operator’s 6 Monthly Social Report Integrated Social Programme Tangguh LNG – Operations Phase October 2009 – April 2010

BP / ADB Not dated

Operator’s 6 Monthly Social Report Integrated Social Programme Tangguh LNG – Operations Phase, April – October 2010

BP / ADB Not dated

Operator’s 6 Monthly Social Report Integrated Social Programme Tangguh LNG – Operations Phase October 2010 – April 2011

BP / ADB Not dated

OPERATOR’S MID-TERM ISP/LARAP REPORT TO LENDERS

BP / ADB May 2009

Internal environmental and social monitoring documentation

Operator’s Environmental, Health and Safety Report BP Not dated Tangguh LNG Project April – October 2010



Type of Document Document Title Author Date

RKL - RPL IMPLEMENTATION REPORT October 2010 – BP Not dated April 2011

Operator’s Environmental, Health and Safety Report BP Not dated Tangguh LNG Project October 2010 – April 2011

*In addition to the above, all of the documents included in Appendi viewed. x A were re



Appendix C. Stakeholders Consulted

T keholders inter EPII and some of this consultatio picted in

F rleaf.

T iewed

able C.1and Table C.2 below list the sta viewed by n is de

igure C.1 to Figure C.3 ove

able C.1: External stakeholders intervStakeholder Location Date

Taroy Village Kepala Kampung (Village local government Leader)

Midwife and Health Cadres

Taroy Cooperative Centre (shrimp and fish)

Sunday 20th November 2011 Taroy Village

Mediatama Ciptacitra (MCC) Health Worker

Bintuni Regency Bupati (government) Secretary

Bintuni Regency Government Department of Economy, Industry, Trading, Cooperation and Micro Business

Bintuni Regency Government Department of Agriculture

Bintuni Regency Government Department of Health

Bintuni Regency Government Department of Education

Bintuni Town Hospital administrators and nurses

Monday 21st November 2011 Bintuni Town

Bintuni based ILO sewing training for women

Tofoi Village Kepala Kampung

Tofoi Agriculture Produce Cooperative Manager, Secretary and UGM Advisor

Prima Irian worker (BP’s partner in agricultural capacity building)

Tofoi Village Credit Union (not a BP partner but many cooperative members are CU members)

Tofoi health cadres (x2)

Tuesday 22nd November 2011 Tofoi Village

Primary school (SD)headmaster and teacher

Teacher at junior High School

Agricu operative membelture Co rs

Mayri Cooperative Members (managing utilities provision in RAVs)

Individual a d household interviews with community memn bers regarding resettlement process

UGM worker

Tanah Merah Baru Village

Saengga Village Head of Government Affairs

Saengga Village Adat (indigenous peoples) Leader

Dimaga Foundation Clan Implementers (x3)

Wednesday 23rd November

Saengga Village

Onar Baru Village Kepala Kampung

Primary (SD) school teacher

Onar Baru Village

Onar Lamu Village Kepala Kampung

Thursday 24th November

Onar Lamu

Table C.2: Community focus group discussions Focus group Discussion Stakeholders Gender Location Date

Usaha Bersama Simpan Pinjam (UBSP) Agricultural Cooperative

women

Taroy villagers

Sunday 20th Taroy November 2011

men

IMURI gricultural CoA operative (history of Tofoi), women

Tofoy villagers

Tuesday 22nd Tofoi November 2011 men

Wednesday 23rd Saengga villagers women Saengga




Focus group Discussion Stakeholders Gender Location Date

Saengga villagers men

Tanah Merah Baru villagers women (2 groups)

Mayri Coperative Members villagers men

Tanah Merah Baru

November

Onar Baru villagers men and women

Onar Baru villagers men

Onar Baru

Onar Lamu villagers women

Onar Lamu villagers men

Onar Lamu

Thursday 24th November

Figure C.1: EPII and BP meetings with Bintuni Regency Government Staff in Bintuni Town


Figure C.2: Focus group discussion with village men Figure C.3: Focus group discussion with village women

Source: EPII site visit Source: EPII site visit