Environmental and Social Due Diligence for Construction ... and Social Due Diligence for Construction Supervision Services for the Caculo Cabaça Hydropower Project, Kwanza River,

Environmental and Social Due Diligence for Construction Supervision Services for the Caculo Cabaça Hydropower Project, Kwanza River, Angola

Report Prepared for

Report Number 524233

Report Prepared by

November 2017

SRK Consulting: Standard Bank Caculo Cabaca ESDD Page i

DALC/REUT 524233 Standard Bank Caculo Cabaca ESDD_sr November 2017

Environmental and Social Due Diligence for Construction Supervision Services for the Caculo Cabaça Hydropower Project, Kwanza River, Angola

Standard Bank

SRK Consulting (South Africa) Pty Ltd The Administrative Building Albion Spring 183 Main Rd Rondebosch 7700 Cape Town South Africa e-mail: [email protected] website: www.srk.co.za

Tel: +27 (0) 21 659 3060 Fax: +27 (0) 86 530 7003

SRK Project Number 524233

November 2017

Compiled by: Peer Reviewed by:

Chris Dalgliesh Partner and Principal Consultant

Sue Reuther Associate Partner and Principal Consultant

Email: [email protected]

Authors:

Chris Dalgliesh, Sue Reuther

http://www.srk.co.za/

mailto:[email protected]

SRK Consulting: Standard Bank Caculo Cabaça ESDD Page ii


Executive Summary Introduction

Industrial and Commercial Bank of China Limited (“ICBC”) has been mandated by the Ministry of Finance of

Angola to arrange the partial funding of the Caculo Cabaça Hydropower Project on the Kwanza River (the

“Project”), which will be constructed by a Chinese and Portuguese consortium comprising China Gezhouba

Group Co (“CGGC”), Boreal Investments Ltd and CGGC & Niara-Holding Lda (collectively “CGGC”).

An Environmental and Social Impact Assessment (“ESIA”) for Caculo Cabaça Dam was completed by

Angolan consultants, Progest Lda in collaboration with Fluidex Lda, to meet Angolan legislative

requirements. The proponent requesting authorisation or licensing of the Project is the Gabinete de

Aproveitamento do Médio Kwanza (Office for the Management of the Middle Kwanza – “GAMEK”), an entity

under the jurisdiction of the Ministry of Energy and Water Resources (“MINEA”). GAMEK will be responsible

for the development of the Project. It is anticipated that Produção de Electricidade (National Company for

Electricity Production – “PRODEL”) will operate the dam and hydropower plant once commissioned.

In mid-2016 ICBC commissioned SRK Consulting China Ltd (“SRK China”), supported and guided by SRK

(South Africa) (Pty) Ltd (“SRK ZA”), as the Independent Environmental and Social Consultant (IESC) to

undertake the pre-financial close Environmental and Social Due Diligence (“ESDD”), including an initial

Environment and Social Action Plan (“ESAP”), both submitted to ICBC in or about August 2016. Compliance

was assessed in terms of Angolan legislation, the International Finance Corporation (“IFC”) Performance

Standards (“PS”) (2012), The World Bank Environmental Health and Safety (“EHS”) Guidelines, the Equator

Principles (“EP”) and World Bank (“WB”) Safeguard Policy (“SP”) Safety of Dams (OP 4.37, 2001),

collectively referred to as the “Lender Group standards”. In April 2017 ICBC appointed SRK to undertake the

first Performance Review, submitted to ICBC in September 2017.

A consortium led by Standard Bank, and supported by EKN and SEK (the “Lender Consortium”), is

considering financing elements of the Project, namely, a construction supervision services contract between

GAMEK and a consortium of contractors, herein referred to as the “AIBC Consortium”, and including

Anglostar Management DMCC, Intertechne Consultores S.A., Baran Group Limited and Copia Group of

Companies S.A. A fifth contractor, Sweco International AB, is looking to join the consortium. The Lender

Consortium has appointed SRK ZA to update the ESDD and ESAP and to accompany Standard Bank, EKN

and SEK on a site visit.

Review Conclusions

A review against the IFC PS and EP identified a number of key gaps (as at July 2016), which are

summarised below. Material gaps are listed in italics:

The baseline information on biodiversity provided in the ESIA is relatively generic, with limited to no local

biophysical data provided. No detailed biodiversity surveys informed the ESIA and SRK considers the

biodiversity baseline to be deficient.

Ecosystem services have not been identified or assess and a BAP has not been developed.

The Project’s “battery limits”, i.e. components of the Project included (and excluded) from the ESIA,

differentiating between ancillary infrastructure and associated facilities, are not clearly defined and/or

assessed.

A clear layout diagram of the Project infrastructure and associated work areas is not provided. As such

the extent of the Project footprint is not clearly defined.

The discussion and assessment of many impacts, as well as the mitigation measures identified are

relatively generic, and not linked to the local environment or exact location of the Project infrastructure

(where required).

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Land capability of the inundated area and associated opportunity costs are not discussed.

Cumulative impacts have not been assessed and/or incorporated.

An EMP (and Framework ESMS) and associated plans required to comply with GIIP have not yet been

developed.

Management systems are not in place for the operations phase and it is difficult to gauge PRODEL’s (the

operator) capacity to manage HSE issues during operations.

Stakeholder engagement undertaken during the ESIA does not comply with GIIP.

Grievance mechanisms for workers and the community are not yet adequately formalised.

A stand-alone, Project-specific OHS Plan/System are not yet developed.

Potential on-site land mines pose a threat to the safety of labours during construction.

Recruitment and working (including accommodation) conditions are generally not addressed in detail in

the ESIA, which shifts responsibility to the EPC Contractor. This is a gap in the ESIA.

Waste management and disposal procedures are not clearly defined in the ESIA, and areas to be

avoided when establishing waste storage areas have not been mapped.

Guidelines or baseline levels against which ongoing (e.g. water and air quality) monitoring should be

benchmarked are not provided.

Although rehabilitation of disturbed areas is recommended, no indication is provided of the extent of the

area that will be rehabilitated or the proposed rehabilitation methodologies.

Community health, safety and security are not assessed in the ESIA.

Dam safety for the maximum seismic activity of the Project (e.g. induced by filling of the reservoir) must

still be verified.

No evidence is provided of a survey having been undertaken of the Project area to determine whether it

is occupied or where economic activities (e.g. agriculture, artisanal diamond mining) are taking place.

Economic displacement of subsistence farmer in the area is not adequately addressed.

No RAP or Compensation Plan is in place to address the agricultural activities reportedly taking place

within the Project footprint.


There is uncertainty regarding the presence and location of cultural heritage resources within the Project

footprint. There is no evidence of a heritage survey having been undertaken.

Recommendations

An initial suite of key recommendations to address gaps was formulated in June 2016. The most recent (and

applicable) suite of key recommendations, stipulating the proposed management measures and timelines for

resolution of key technical GIIP non-compliances, are documented in the ESAP (July 2017). Some pertinent

observations as regards implementation of the ESAP are as follows:

Generally, it is evident that CGGC is aware of HSE aspects of the Project. There are 42 ESAP action items

and SRK recognises that at this early phase of the Project it is unrealistic to expect many actions to be

closed-out: the deadlines in the ESAP reflect this. Very significant and rapid progress will be required to

avoid a large number of non-compliances.

GAMEK is assigned responsibility for delivery of a number of ESAP action items. However, in practice,

GAMEK has limited resources and will expect CGGC to attend to action items assigned to GAMEK.

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The ESAP clearly presents items which need to be actioned, and certain items need to be prioritised to meet

2017 deadlines. These include further baseline surveys and monitoring, compilation / completion of selected

management plans, wide-ranging stakeholder engagement, as well as implementation of a comprehensive

grievance mechanism, acquisition of a demining certificate, improved waste management practices and

facilities, considering disclosure of the ERP, confirmation of potential resettlement requirements including a

survey to confirm any form of physical or economic displacement in the inundated area, liaison with INBAC

to confirm the biodiversity offset process, and an independent heritage study.

To ensure compliance with GIIP, ongoing compliance reviews of the ESAP at the following intervals are

recommended:

Regular Reviews – every six months till completion of construction and commissioning; and

Operational Review – annually after operation commences till final maturity date, which is defined in the

facility agreement.

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Table of Contents

1 Introduction .................................................................................................................. 1

1.1 Background ......................................................................................................................................... 1

1.2 Brief Project Description ..................................................................................................................... 1

1.3 Environmental and Social Setting ....................................................................................................... 4

1.3.1 Environmental ......................................................................................................................... 4

1.3.2 Social ....................................................................................................................................... 5

2 Scope of Work .............................................................................................................. 6

3 Review Methodology .................................................................................................... 7

3.1 Desktop Review of Documentation ..................................................................................................... 7

3.2 Gap Analysis ....................................................................................................................................... 7

3.3 Site Visit .............................................................................................................................................. 7

3.4 Reporting and Discussion of Findings ................................................................................................ 8

4 Governance Framework ............................................................................................... 8

4.1 Angolan Legislative Framework .......................................................................................................... 8

4.2 Selected International Standards ...................................................................................................... 10

4.2.1 IFC Performance Standards ................................................................................................. 10

4.2.2 World Bank/IFC Environmental Health and Safety Guidelines ............................................. 12

4.2.3 Equator Principles III ............................................................................................................. 13

4.2.4 World Bank Safeguard Policy of Dams ................................................................................. 13

5 Status of Compliance and Review Findings ............................................................ 14

5.1 Host Country Legislation and Permitting........................................................................................... 14

5.2 IFC Performance Standards ............................................................................................................. 14

5.2.1 PS1: Assessment and Management of Environmental and Social Risks and Impacts ........ 14

5.2.2 PS2: Labour and Working Conditions ................................................................................... 18

5.2.3 PS3: Resource Efficiency and Pollution Prevention ............................................................. 18

5.2.4 PS4: Community Health, Safety and Security....................................................................... 20

5.2.5 PS5: Land Acquisition and Involuntary Resettlement ........................................................... 21

5.2.6 PS6: Biodiversity Conservation and Sustainable Management of Living Natural Resources21

5.2.7 PS7: Indigenous Peoples ...................................................................................................... 22

5.2.8 PS8: Cultural Heritage ........................................................................................................... 22

5.3 World Bank/IFC Environmental Health and Safety Guidelines ......................................................... 23

5.4 Equator Principles III ......................................................................................................................... 25

5.5 World Bank Safeguard Policy for Dams ........................................................................................... 26

5.6 ESAP: Progress and Performance June 2017 ................................................................................. 26

5.6.1 IFC PS 1: Assessment and Management of Social and Environmental Risks and Impacts 26

5.6.2 IFC PS 2: Labour and Working Conditions ........................................................................... 27

5.6.3 IFC PS 3: Resource Efficiency and Pollution Prevention ...................................................... 28

5.6.4 IFC PS 4: Community Health, Safety and Security ............................................................... 28

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5.6.5 IFC PS 5: Land Acquisition and Involuntary Resettlement ................................................... 28

5.6.6 IFC PS 6: Biodiversity Conservation and Sustainable Management of Living Natural Resources ............................................................................................................................. 29

5.6.7 IFC PS 8: Cultural Heritage ................................................................................................... 29

6 Conclusions and Recommendations ........................................................................ 30

6.1 Conclusions ....................................................................................................................................... 30

6.2 Recommendations: July 2016 ........................................................................................................... 31

6.3 Recommendations: June 2017 ......................................................................................................... 33

Appendices ...................................................................................................................... 35

Appendix A: Environmental and Social Action Plan .................................................... 36

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List of Tables

Table 1-1: Characteristics of Caculo Cabaça ..................................................................................................... 2

Table 3-1: Documents reviewed for the ESDD................................................................................................... 7

List of Figures

Figure 1-1: Location of the Project on the Kwanza River and in relation to other reservoirs in the Kwanza River Hydropower Scheme .......................................................................................................... 2

Disclaimer

The opinions expressed in this report have been based on the information supplied to SRK Consulting China

Ltd (“SRK”) by the Industrial and Commercial Bank of China Limited (“ICBC”), China Gezhouba Group Co.

(“CGGC”) and a consortium led by Standard Bank, and supported by EKN and SEK (the “Lender

Consortium”). SRK has exercised all due care in reviewing the supplied information, but conclusions from the

review are reliant on the accuracy and completeness of the supplied data. SRK does not accept

responsibility for any errors or omissions in the supplied information and does not accept any consequential

liability arising from commercial decisions or actions resulting from them. Opinions presented in this report

apply to the site conditions and features as they existed at the time of SRK’s investigations, and those

reasonably foreseeable. These opinions do not necessarily apply to conditions and features that may arise

after the date of this Report, about which SRK had no prior knowledge nor had the opportunity to evaluate.

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List of Abbreviations

AIDS Acquired Immuno Deficiency Syndrome

AMD Access Main Dam

AoI Area of Influence

BAP Biodiversity Action Plan

CIA Cumulative Impact Assessment

CRP Closure and Rehabilitation Plan

CSI Corporate Social Investment

EHS Environmental, Health and Safety

EIA Environmental Impact Assessment

EIS Environmental Impact Statement

EMP Environmental Management Plan

EP Equator Principles

EPC Engineering, Procurement and Construction (contractor)

ERP Emergency Response Plan

ESAP Environmental and Social Action Plan

ESDD Environmental and Social Due Diligence

ESIA Environmental and Social Impact Assessment

ESMS Environmental and Social Management System

GAMEK Gabinete de Aproveitamento do Médio Kwanza (Office for the Management of the Middle Kwanza)

CGGC China Gezhouba Group Co.

GHG Greenhouse Gas

GIIP Good International Industry Practice

HIV Human Immunodeficiency Virus

HSE Health, Safety and Environment

ICBC Industrial and Commercial Bank of China Limited

IESC Independent Environmental and Social Consultant

IFC International Finance Corporation

ISO International Organisation for Standardisation

LRP Livelihoods Restoration Plan

masl Meters above sea level

MINEA Ministry of Energy and Water Resources

OECD Organisation for Economic Co-Operation and Development

OHS Occupational Health and Safety

PM10 Particulate matter 10 micrometers or less in diameter

PRODEL Produção de Electricidade (National Company for Electricity Production)

PS Performance Standard

RAP Resettlement Action Plan

SEP Stakeholder Engagement Plan

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SRK China SRK Consulting China Ltd

SRK ZA SRK Consulting (South Africa) (Pty) Ltd

WMP Waste Management Plan

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Units of Measurement

oC Degrees Celsius

GWh Gigawatt hours

hm3 cubic hectometre

m metre

m3 cubic metres

m3/s cubic metres per second

mm millimetres

km kilometre

km2 square kilometre

km/h kilometres per hour

kV kilovolts

MW MegaWatt

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Glossary

Baseline Information gathered at the beginning of a study which describes the environment prior to development of a project and against which predicted changes (impacts) are measured.

Biodiversity The diversity, or variety, of plants, animals and other living things in a particular area or region. It encompasses habitat diversity, species diversity and genetic diversity

Consultation A process for the exchange of views, concerns and proposals about a proposed project through meaningful discussions and the open sharing of information.

Disclosure The release of or provision of access to information, usually (but not exclusively) in the form of written reports.

Ecology The study of the interrelationships of organisms with and within their environment

Ecosystem The interconnected assemblage of all species populations that occupy a given area and the physical environment with which they interact.

Ecosystem service Ecosystem services relate to the benefits people obtain from ecological functions and are often grouped into four broad categories: provisioning, such as the production of food and water; regulating, such as the control of climate and disease; supporting, such as nutrient cycles and crop pollination; and cultural, such as spiritual and recreational benefits.

Environment The external circumstances, conditions and objects that affect the existence and development of an individual, organism or group. These circumstances include biophysical, social, economic, historical and cultural aspects.

Environmental and Social Impact Assessment

A process of evaluating the environmental and socio-economic consequences of a proposed course of action or project.

Environmental Management Plan

A description (in an EIS or separate document) of the means (or the environmental specification) for achieving environmental objectives and targets during all stages of a specific proposed activity.

Fauna The collective animals of a given region.

Flora The collective plants growing in a geographic area.

GAMEK GAMEK is a component body of the Ministry of Energy and Water Resources and has administrative and financial independence. The nature and purpose of GAMEK, specified in its Statute (Estatuto Orgânico) approved by Joint Directive (Despacho Conjunto) No. 14/86, dated 17 March 1986, is to undertake studies, preparatory analyses and projects for national water resource use in the Middle Kwanza River Basin.

Geohydrological (The study of) groundwater

Heritage Resources Refers to something, e.g. a building, an area, a ritual, etc. that forms part of a community’s cultural legacy or tradition and is passed down from preceding generations.

Hydraulic (The study of) water flow.

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Hydrological (The study of) surface water flow.

Mitigation measures Design or management measures that are intended to avoid and / or minimise or enhance an impact, depending on the desired effect. These measures are ideally incorporated into a design at an early stage.

Specialist study A study into a particular aspect of the environment, undertaken by an expert in that discipline.

Stakeholders All parties affected by and/or able to a project, often those in a position of authority and/or representing others.

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1 Introduction

1.1 Background

Industrial and Commercial Bank of China Limited (“ICBC”) has been mandated by the Ministry of

Finance of Angola to arrange the partial funding of the Caculo Cabaça Hydropower Project on the

Kwanza River (the “Project”), which will be constructed by a Chinese and Portuguese consortium

comprising China Gezhouba Group Co (“CGGC”), Boreal Investments Ltd and CGGC & Niara-

Holding Lda (collectively “CGGC”).

An Environmental and Social Impact Assessment (“ESIA”) for Caculo Cabaça Dam was completed

by Angolan consultants, Progest Lda in collaboration with Fluidex Lda, to meet Angolan legislative

requirements. The proponent requesting authorisation or licensing of the Project is the Gabinete de

Aproveitamento do Médio Kwanza (Office for the Management of the Middle Kwanza – “GAMEK”),

an entity under the jurisdiction of the Ministry of Energy and Water Resources (“MINEA”). GAMEK

will be responsible for the development of the Project. It is anticipated that Produção de Electricidade

(National Company for Electricity Production – “PRODEL”) will operate the dam and hydropower

plant once commissioned.

In mid-2016 ICBC commissioned SRK Consulting China Ltd (“SRK China”), supported and guided

by SRK (South Africa) (Pty) Ltd (“SRK ZA”), as the Independent Environmental and Social

Consultant (IESC) to undertake the pre-financial close Environmental and Social Due Diligence

(“ESDD”), including an initial Environment and Social Action Plan (“ESAP”), both submitted to ICBC

in or about August 2016. Compliance was assessed in terms of Angolan legislation, the International

Finance Corporation (“IFC”) Performance Standards (“PS”) (2012), The World Bank Environmental

Health and Safety (“EHS”) Guidelines, the Equator Principles (“EP”) and World Bank (“WB”)

Safeguard Policy (“SP”) Safety of Dams (OP 4.37, 2001), collectively referred to as the “Lender

Group standards”. In April 2017 ICBC appointed SRK to undertake the first Performance Review,

submitted to ICBC in September 2017.

CGGC appointed CENOR (a Portuguese engineering and consulting firm) to guide and assist with

implementation of the ESAP.

A consortium led by Standard Bank, and supported by EKN and SEK (the “Lender Consortium”), is

considering financing elements of the Project, namely, a construction supervision services contract

between GAMEK and a consortium of contractors, herein referred to as the “AIBC Consortium”, and

including Anglostar Management DMCC, Intertechne Consultores S.A., Baran Group Limited and

Copia Group of Companies S.A. A fifth contractor, Sweco International AB, is looking to join the

consortium. The Lender Consortium has appointed SRK ZA to update the ESDD and ESAP and to

accompany Standard Bank, EKN and SEK on a site visit.

1.2 Brief Project Description

The Caculo Cabaça Hydropower Project is located in the middle course of the Kwanza River,

upstream of the Caculo Cabaça falls, on the border between the Kwanza North and Kwanza South

Provinces, approximately 270 km east of Luanda (see Figure 1-1).

Caculo Cabaça is one of eight dams (now reduced to seven as a consequence of a decision to

construct a single larger Zenzo Dam, rather than Zenzo I and Zenzo II, as originally envisaged)

planned for the Kwanza River Hydropower Scheme. Two hydroelectric power stations are currently

in operation on the Kwanza River, Cambambe (simultaneously being upgraded) and Capanda, while

Lauca is currently under construction. With an anticipated maximum power generation capacity of



2 172 MW, Caculo Cabaça will be the largest hydropower plant in Angola, although a relatively small

area will be inundated1.

Figure 1-1: Location of the Project on the Kwanza River and in relation to other reservoirs

in the Kwanza River Hydropower Scheme

Source: Progest, 2015

The reservoir will have a run of river operating system with the following characteristics:

Table 1-1: Characteristics of Caculo Cabaça

Feature Dimension

Reservoir maximum length 16.3 km

Maximum width 2.6 km

Inundated area 16.6 km2

Full supply level 630 m

Maximum flood level 630 m

Total stored volume 436 hm3 (cubic hectometres)

It is expected that the Caculo Cabaça Reservoir will fill in 9.47 days under “normal” flow conditions

(i.e. regulated discharge from Lauca Dam) and in 2 days under flood conditions.

The Caculo Cabaça Hydropower Project comprises the following:

The reservoir with a maximum length of 16.3 km and a maximum width of 2.6 km,

corresponding to an inundated area of approximately 16.6 km2 and a storage capacity of

440 million m3 of water.

1 The Caculo Cabaça Hydropower Project is essentially a run of river project with reservoir storage capacity provided by Capanda and Lauca.



During construction, the Kwanza River will be diverted to the right bank using a dual bypass

tunnel system (14 m wide, 14 m high and 353 m and 412 m long, respectively). Upstream of

the bypass tunnels inlet, an intake canal approximately 263 m long and 94 m wide will be

constructed. The bypass tunnels will lead to an outlet canal with an approximate width of 88 m.

Water flow through the bypass tunnels will be controlled with gates.

The main dam wall will be constructed after building the bypass tunnels. The concrete wall will

be 103 m high with a crest width of 553 m.

A forward facing flood spillway (to discharge excess water from the reservoir during floods) will

have a crest level at 612.5 metres above sea level (masl) and will comprise five sluices/spans of

12.8 m each (total effective span of 64 m). The spillway is designed to accommodate a 1: 10 000

year flood event, corresponding with the maximum discharge from the Capanda Hydroelectric

Scheme.

Two gates will control bottom discharge. Bottom discharge will allow the reservoir to be

dewatered rapidly when required and will allow for the entrainment and flushing of fine sediment.

The main powerhouse (221 m x 26.5 m x 68 m in size) situated underground and on the left

bank of the Kwanza River will comprise four turbine generator units (total installed capacity of

2 120 MW) located 30 m apart. The generators will be fed by the main hydraulic circuit including:

o Water intake to abstract water from the reservoir 2.4 km upstream of the dam's left

abutment;

o Four headrace tunnels, one for each generator group, with an inner diameter of 9 m and a

total length of 305 m;

o Surge tanks with a floor area of 3 500 m2 , to attenuate pressure variations in the circuit;

o Two tailwater tunnels downstream of the surge tank, approximately 5 155 m and 5 161 m

long respectively;

o Tailwater canal to discharge water back into the Kwanza River downstraam of the Caculo

Cabaça Falls.

The ecological hydropower plant to generate power from the minimum ecological flow

(60 m3/s) will be located adjacent to the base of the dam, on the left bank of the Kwanza River,

and will include the following:

o Water intake;

o Headrace tunnel;

o Powerhouse (design capacity of 52 MW); and

o Tailwater canal.

A 400 kV substation connected via two 400 kV transmission lines to the Lauca Hydropower

Plant and the Catete substation. An additional 400 kV transmission line will be required for

connection to the Catete substation. However, the transmission lines were not assessed in the

ESIA Report and are not a component of the EPC contract.

A 220 kV substation associated with the ecological hydropower plant, linked to the Lauca

scheme;

Underground access and new above ground access roads on the left and right banks of the

Kwanza River with an estimated total length of 40 km; and



An operator’s village consisting of eight villas and an inn/hotel located on the right abutment of

the dam wall. Also included are six camp areas for administrative staff and construction workers

during the construction phase.

Construction yards will be established on both the left and right banks of the river. Approximately

15 km of 60 kV powerlines between Caculo Cabaça and Lauca will also be required to provide

power during the construction phase. Diesel powered generators will also be provided at

construction yards.

The main plant will produce 8 123 GWh of electricity annually, with a further 443 GWh produced by

the ecological flow plant.

As at June 2017 the Project status was as follows:

Site preparation activities (topographical survey, site clearance, road and camp area

construction) commenced at the beginning of 2016;

Approximately 526 workers were on site, including 308 Angolan employees, with the total

workforce projected to increase to 800 - 1000 in Q4 2017. Roughly 60% of the workers are

Angolan nationals (as at June 2017), and CGGC expects the proportion of Angolan employees

to increase to 70 – 80% by the end of 2017;

The temporary accommodation area was expanded, and a water treatment facility installed to

supply potable water. A wastewater treatment works will be constructed, but to date all

wastewater and effluent is directly discharged to the environment. An unlined landfill is used for

disposal of domestic and hazardous solid waste; and

Roughly 2% of earthworks was completed, including excavation of the diversion tunnel portal as

well as a temporary bridge crossing the Kwanza River, permanent accommodation areas, an

Access Main Dam (“AMD”) roadway (right bank major roadway) and site clearance for various

ancillary facilities and plants.

Formal construction was due to start in July 2017 and be completed during Q1 2023. The first 18-

month tranche of construction includes the diversion tunnels, construction village and ancillary

infrastructure and a waste rock dump. Thereafter, construction of the dam will commence, in or

around January 2019.

Further detail about the Project is provided below.

1.3 Environmental and Social Setting

Based on information contained in the ESIA, the setting of the Caculo Cabaça area and surrounds

displays the following environmental, socio-economic and cultural features:

1.3.1 Environmental

The climate of the region is classified as a warm and humid tropical climate with distinct wet

(September to April) and dry (May to August) seasons. Average annual rainfall exceeds 1 100

mm per year and the months of November and March have the highest precipitation, exceeding

200 mm. The average maximum monthly temperature varies between 30 °C and 34 C° and the

average minimum monthly temperatures varies between 9 C° and 16 C°. Wind speeds are weak

to moderate with maximum speeds up to 17 km/h.

The geology of the mid-Kwanza region is characterised by extensive continental weaknesses

including the Kwanza Horst, a linear upliftment of the latitudinal basement (300 km long and 20 –

50 km wide) separating two geological structures – the Maiombe Shield and a Shield in the

north-west of the south-western Angola. The Kwanza River valley and its tributaries are located



in the areas of least resistance, both in gneissic and sedimentary rocks. The Project is located in

an area of rocks of the Precambrian age consisting mainly of gneisses, amphibolite migmatite

and interleaves the Base Complex (Arqueano- Lower Proterozoic).

The Kwanza River is 950 km in length, divided into three distinct hydromorphological levels:

o the Upper Kwanza, approximately 570km in length over a fall of 520 metres;

o the Middle Kwanza between the Kwanza Falls in Camaca and Cambambe Dam, extending

for 200km with a difference in elevation of approximately 1 000 m; and

o the Lower Kwanza which extends 180km from Cambambe Dam and arcing widely to the

north and to the west before flowing into the Atlantic Ocean at Barra do Kwanza, south of

Luanda.

The catchment area of the Middle Kwanza is one of the four sub-basins in the Kwanza River

catchment. The catchment area of the Caculo Cabaça Dam is 112 663 km2 in extent. This

portion of the river has an average annual flow rate of 680 m3/s with the monthly maximum flow

occurring in April and the minimum flow occurring in September.

Water quality of the Kwanza River is within permissible levels according to water quality tests.

The Kwanza North province falls almost entirely in the domain of the large Guinean

phytogeographical region, with the possible exception of a narrow savannah strip considered to

be the transition zone to the Sudan-Zambezian vegetation community. Two major vegetation

groups are represented in the Guinean region: "dense semi-deciduous rainforest" and "brush

savannah". The Project area is characterised by forest with high levels of deterioration due to

uncontrolled exploitation of various native species for firewood and charcoal and the removal of

forest for subsistence agriculture. The reservoir will flood 9,32 km2 of savannah and 1,69 km2 of

forest, 3,3 km2 of rocky slopes and 2,52 km2 of river bed.

Other than fish species of commercial interest, little is known on the Ichthyofauna of the

Kwanza River. Hippopotamus (three) reportedly inhabit the banks of the Kwanza River at Caculo

Cabaça.

There are no protected areas in close proximity to the site, however the Golungo Alto forest

reserve is situated in Kwanza Norte (some 60 km from the site) and the Quissama National

Park, on the southern bank of the Kwanza River is situated a considerable distance downstream

of the hydropower scheme, near the mouth of the Kwanza River.

The series of rapids on the Kwanza River, including those upstream and downstream of the

Caculo Cabaça Dam could be regarded as a unique ecosystem under threat from the cumulative

impacts of the series of eight (now seven) dams. The portion of the river between the dam wall

and outlet from the powerhouse has a series of rapids in wide beds with deep lagoons and

provides natural habitat for wildlife species.

1.3.2 Social

The study area is situated at the confluence of three Provinces – Kwanza South (municipalities

of Mussende and Libolo), Kwanza North (municipalities of Cambambe and Cazengo) and

Malange Province (municipality of Cacuso).

The majority of the surrounding population are represented by the Kimbundo tribe, although

certain rural villages were also found to speak Umbundo.

Villages within the Project’s Area of Influence (AoI) (including villages along the access road to

the site) include: Dumbo ya Pepe, Kisuba, Bairro Novo, Candengue, Camongo and Bungu (in

commune S. Pedro da Quilemba) and Zone 1, Zone 2, Zone 3 and Zone 4 (in commune Banza

Cabunta).



Healthcare facilities in the region are limited. The most frequently diagnosed diseases are likely

to be malaria, tuberculosis, leprosy, trypanosomiasis, schistossomiasis, Human

Immunodeficiency Virus (“HIV”)/ Acquired Immuno Deficiency Syndrome (“AIDS”), acute

respiratory diseases, diarrhoea and blenorragia;

The main livelihoods in the area are linked to agriculture, fishing, hunting and animal

husbandry. The most commonly cultivated agricultural crops are cassava, corn, beans and

sweet potato. Cassava is produced on a large scale, but cannot be transported to the urban

centres. Agriculture is mostly subsistence agriculture, limited in scale by the distance of the

villages from the Kwanza River.

Road infrastructure is poor hindering the movement of people and goods.

Many of the surrounding villages rely on generators for electricity, while water is provided by

tankers or taken from the Kwanza River. There is no basic sanitation system in the villages.

Limited heritage resources were identified in the Project area. The Filomeno da Camara Bridge

and a church (unspecified) are identified as having historical and cultural value, with no

archaeological resources identified in the Project area.

The Project area is frequently exploited by the surrounding population for firewood, charcoal and

subsistence agriculture, leading to loss of some species of great economic, medicinal and

environmental importance.

2 Scope of Work The Gap Analysis focuses exclusively on the Project as described above, ancillary infrastructure and

associated facilities (as defined by the IFC PS, e.g. power transmission lines) assessed in the ESIA.

The main objective of the ESDD is to assess compliance of the Project’s environmental, social, and

health and safety assessments, plans and procedures with Good International Industry Practice

(“GIIP”), and to advise the Lender Consortium of any additional work required to meet GIIP, with

particular reference to:

Adequacy, coverage and appropriateness of the baseline data used and the methods used to

collect the data;

Adequacy and appropriateness of the impact assessment (including the consideration of

potentially significant cumulative impacts) and identification of management measures for the

proposed Project activities;

Adequacy of monitoring plans, data evaluation and reporting; and

Adequacy and appropriateness of the stakeholder engagement process.

The Scope of Work entailed:

Review the ESIA and other relevant information, including any specialist studies and records of

stakeholder engagement, and identify key issues relating to the impact assessment, reporting

and disclosure;

Update the ESDD to identify any material gaps between the existing Project scoping/ESIA/EMP

related documents and GIIP;

Update the ESAP, identifying key actions to address identified gaps;

Accompany the Lender Consortium on a site visit to:

o Understand the environmental and social context of the Project; and

o Confirm gaps and risks identified during document review; and



Finalise the ESDD and ESAP.

The ESDD (Gap Analysis) assesses compliance in terms of Angolan legislation and GIIP, including

the IFC PS, World Bank/IFC Environmental Health and Safety Guidelines, EP III, and World Bank

Safeguard Policy for Dams. An ESAP sets out specific requirements for addressing each risk and

gap.

This ESDD report is effectively a hybrid of an ESDD undertaken in 2016 and an updated ESAP

completed in September 2017.

SRK recommends that annual or bi-annual verification of the implementation of the ESAP be

undertaken by qualified and experienced independent environment and social experts.

3 Review Methodology

3.1 Desktop Review of Documentation

Available relevant documentation and data were reviewed by SRK. This included the ESIA and

other project related documents available to SRK. Table 3-1 presents a list of documents that were

reviewed for the ESDD (and ESAP).

Table 3-1: Documents reviewed for the ESDD

Document Title Date Author

Environmental Impact Report (Portuguese version and Chinese version)

December 2015 Progest & Fluidex

Environmental License for Construction (Portuguese version and Chinese version)

17 March 2016 MinAmb

Feasibility Study Report for Caculo Cabaca Hydropower Station, Angola (Chinese version and English version)

July 2015 Changjiang Survey, Planning, Design and Research Co., Ltd.

Technical Review of the Feasibility Study Report for Caculo Cabaca Hydropower Station, Angola (Chinese version)

April 2016 China International Engineering Consulting Co.

Health and Safety Plan (Chinese version and English version)

2016 CGGC

Environmental Management Plan(Chinese version and English version)

2016 CGGC

Emergency Response Plan (Chinese version) 2016 CGGC

Recruitment Plan for overseas projects (Chinese version) 2016 CGGC

Environmental and Social Due Diligence for the Caculo Cabaça Hydropower Project, Kwanza River, Angola

May 20017 SRK China

Angola Caculo Cabaça Hydropower Project Environmental and Social Action Plan: Performance Report 1

September 2017 SRK China

3.2 Gap Analysis

SRK considers this a critical element of the ESDD. A summary of Angolan regulatory environment

and relevant policies and guidelines, as well as international standards and benchmarks is presented

in Section 4. A comprehensive and detailed gap analysis, which highlights compliance criteria, gaps

and recommendations, is provided in Section 5.

3.3 Site Visit

Representatives from the Lender Consortium and SRK (and possibly GAMEK) are scheduled to visit

the site between 4 and 7 December 2017. The objective is to familiarise the Lender Consortium with



the Project, not to review performance against the ESAP. This ESDD report may be updated after

the site visit.

3.4 Reporting and Discussion of Findings

This ESDD Report presents the results and conclusions of the detailed review of all ESIA related

documents, plans and procedures as at June 2017, and an appraisal of their adequacy and Project

compliance with the GIIP. An updated ESAP was prepared accordingly and the ESAP identifies:

Key action required to address the material gaps identified between the ESIA and GIIP;

Suggested parties responsible for the required action; and

Suggested timeframes for the required action.

This ESAP is provided in Appendix A.

4 Governance Framework This section presents a summary of the governance framework relevant to the Project. Information

is taken from recent reviews of Angolan legislation as well as SRK summaries of relevant

international and other standards.

4.1 Angolan Legislative Framework

The Republic of Angola is a unitary state based on the Constitution of 1975 (as amended, most

recently in 2010), which provides the framework for the national administrative and organisational

structure. Article 39 of the Constitution provides for the fundamental right of individuals to live in a

healthy and non-polluted environment and establishes an obligation on the State to take the

necessary actions to protect the environment and maintain the ecological balance.

Angolan law is enacted at the national level through different legislative instruments. The most

important of these are laws and decrees as described below:

Laws: these are the main sources of primary legislation and are passed by the National

Assembly. They tend to cover broad issues and provide the enabling framework for the

competent authorities to issue more detailed implementing legislation, e.g. decrees. Laws

issued at national level apply throughout Angola, with implementation, monitoring and

enforcement carried out at both the national and provincial levels.

Decree-laws and Decrees: these are passed by the Council of Ministries, while Regulations

(Executive Decrees) and Dispatches are normally issued by a ministry. They provide a

subordinate form of primary legislation and tend to cover more specific issues (and are

analogous to regulations adopted in many other countries).

Several pieces of national law refer to pollution of the environment, environmental impact

assessment (“EIA”) and the protection of the environment in general. Angolan regulations tend to be

fairly broadly framed and do not provide detailed standards (e.g. air quality, noise levels etc.) against

which compliance can be measured. In the absence of such standards the default is to international

standards (e.g. World Bank, European Commission) and, sometimes, to regional standards (e.g.

South African). A synopsis of the relevant legislative and administrative framework is provided

further below.

The most critical legislative requirement pertaining to certain proposed projects is that a

comprehensive EIA process for the Project is undertaken. Typically this requires the compilation of



an Environmental Impact Statement (“EIS”), incorporating environmental management measures,

which are subject to comprehensive review by the authorities.

Items of legislation, which regulate the way in which EIAs are undertaken, are provided below:

General Environmental Law No 5/98;

Decree No. 51/04 on Environmental Impact Assessment;

Decree No. 59/07 on Environmental Licensing;

Joint Executive Decree No. 130/09 on Environmental Licensing;

Executive Decree No. 87/12 on Public Consultation for Projects Subject to Environmental Impact

Assessment;

Decree No. 1/10 on Environmental Audits; and

Executive Decree No. 92/12 on the Terms of Reference for Environmental Impact Studies.

Additional legislation with relevance to the proposed Project includes:

Water Law No. 6/02 on the use if hydrological resources;

Presidential Decree No. 141/12 on the Prevention and Control of the Pollution of National Water;

Law 6A/04 on Aquatic Biological Resources;

Presidential Decree No. 190/12 on Waste Management;

Executive Decree No. 17/13 on Construction and Demolition waste

Decree No. 31/94 on the Establishment of the Principles to Promote Health, Safety and

Workplace Conditions;

Executive Decree No. 128/04 on Regulation on Safety and Health for Workplace Signalling;

Presidential Decree No. 194/11 on Liability on Environmental Damage;

Presidential Decree No. 261/11 on Water Quality;

Decree No. 40.040 on Protection of Terrestrial Fauna;

Resolution No. 42/06 on the National Biodiversity Strategy and Action Plan;

Territory and Urbanism System Law No. 3/04;

Cultural Assets Law No. 14/05;

Resolution No. 52/08 on the National Strategy for the Implementation of UN Convention on

Climate Change and Kyoto Protocol;

Land Law No. 9/04; and

General Labour Law No. 2/00.

This list is provided to indicate the legislative framework in Angola and environmental law which may

apply to the Project.



4.2 Selected International Standards

4.2.1 IFC Performance Standards

The IFC PS’s on Environmental and Social Sustainability, which were published in January 2012,

are recognised as being the most comprehensive standards available to international finance

institutions working within the private sector. The principles provide a framework for an accepted

international approach to the management of social and environmental issues.

The eight IFC PS’s are:

PS 1: Assessment and Management of Social and Environmental Risks and Impacts

underscores the importance of managing environmental and social performance throughout the

life of a project. Performance Standard 1 requires the client to conduct a process of

environmental and social assessment and to establish and maintain an Environmental and

Social Management System (“ESMS”), appropriate to the nature and scale of the project and

commensurate with the level of its environmental and social risks and impacts. PS 1 aims to:

o Identify and evaluate environmental and social risks and impacts of the project;

o Adopt a mitigation hierarchy to anticipate and avoid, or where avoidance is not possible,

minimize, and, where residual impacts remain, compensate/offset for risks and impacts to

workers, affected communities, and the environment;

o Promote improved environmental and social performance of clients through the effective use

of management systems;

o Ensure that grievances from affected communities and external communications from other

stakeholders are responded to and managed appropriately;

o Promote and provide means for adequate engagement with affected communities

throughout the project cycle on issues that could potentially affect them; and

o Ensure that relevant environmental and social information is disclosed and disseminated.

PS 2: Labour and Working Conditions recognizes that the pursuit of economic growth through

employment creation and income generation should be accompanied by protection of the

fundamental rights of workers. PS 2 aims to:

o Promote fair treatment, non-discrimination and equal opportunity of workers;

o Establish, maintain and improve the worker-management relationship;

o Promote compliance with national employment and labour laws;

o Protect workers, including vulnerable categories of workers such as children, migrant

workers, workers engaged by third parties and workers in the client’s supply chain; and

o Promote safe and healthy working conditions and the health of workers; and avoid the use of

forced labour.

PS 3: Resource Efficiency and Pollution Prevention recognizes that increased economic

activity and urbanization often generate increased levels of pollution to air, water, and land, and

consume finite resources in a manner that may threaten people and the environment at the

local, regional, and global levels. Thus, PS 3 aims to:

o Avoid or minimise pollution from project activities;

o Promote more sustainable use of resources (including energy and water); and

o Reduce project-related Greenhouse Gas (“GHG”) emissions.

PS 4: Community Health, Safety and Security, recognizes that project activities, equipment,

and infrastructure can increase community exposure to risks and impacts. PS 4 aims to:



o Anticipate and avoid adverse impacts on the health and safety of affected communities

during the project life from both routine and non-routine circumstances; and

o Ensure that the safeguarding of personnel and property is carried out in accordance with

relevant human rights principles and in a manner that avoids or minimizes risks to the

affected communities.

PS 5: Land Acquisition and Involuntary Resettlement, recognizes that project-related land

acquisition and restrictions on land use can have adverse impacts on communities and persons

that use this land. PS 5 thus aims to:

o Avoid, and when avoidance is not possible, minimize displacement by exploring alternative

project designs;

o Avoid forced eviction;

o Anticipate and avoid, or where avoidance is not possible, minimize adverse social and

economic impacts from land acquisition or restrictions on land use by (i) providing

compensation for loss of assets at replacement cost and (ii) ensuring that resettlement

activities are implemented with appropriate disclosure of information, consultation and the

informed participation of those affected; and

o Improve, or restore, the livelihoods and standards of living of displaced persons.

PS 6: Biodiversity Conservation and Sustainable Management of Living Natural

Resources, recognizes that protecting and conserving biodiversity, maintaining ecosystem

services, and sustainably managing living natural resources are fundamental to sustainable

development. PS 6 aims to:

o Protect and conserve biodiversity;

o Maintain the benefits from ecosystem services; and

o Promote the sustainable management of living natural resources through the adoption of

practices that integrate conservation needs and development priorities.

PS 7: Indigenous Peoples, recognises that Indigenous Peoples, as social groups with identities

that are distinct from mainstream groups in national societies, are often among the most

marginalized and vulnerable segments of the population. PS 7 thus aims to:

o Ensure that the development process fosters full respect for human rights, dignity,

aspirations, culture and natural resource-based livelihoods of Indigenous Peoples;

o Anticipate and avoid adverse impacts of projects on communities of Indigenous Peoples, or

when avoidance is not possible, to minimize and/or compensate for such impacts;

o Promote sustainable development benefits and opportunities for Indigenous Peoples in a

culturally appropriate manner;

o Establish and maintain an ongoing relationship based on informed consultation and

participation with the Indigenous Peoples affected by a project throughout the project’s life-

cycle;

o Ensure the Free, Prior and Informed Consent of the affected communities of Indigenous

Peoples when the circumstances described in this Performance Standard are present; and

o Respect and preserve the culture, knowledge and practices of Indigenous Peoples.

PS 8: Cultural Heritage recognizes the importance of cultural heritage for current and future

generations. As such, PS 8 aims to:

o Protect cultural heritage from the adverse impacts of project activities and support its

preservation; and



o Promote the equitable sharing of benefits from the use of cultural heritage.

PS 1 thus establishes the importance of (i) integrated assessment to identify the environmental and

social impacts, risks, and opportunities of projects; (ii) effective community engagement through

disclosure of project-related information and consultation with local communities on matters that

directly affect them; and (iii) the client’s management of environmental and social performance

throughout the life of the project.

IFC PS2 through 8 present requirements to avoid, reduce, mitigate or compensate for impacts on

people and the environment, and to improve conditions where appropriate. Where social or

environmental impacts are anticipated, the client is required to manage them through its ESMS

consistent with PS1.

The IFC PS are matched with corresponding Guidance Notes that provide guidance on the

requirements contained in the standards and on good sustainability practices to help clients improve

project performance.

Note that many of the PS will be of limited application during the ESIA, but will or may need to be

implemented during construction, commissioning, operation and/or closure. SRK is of the opinion

that PS 7 is not applicable to this Project.

4.2.2 World Bank/IFC Environmental Health and Safety Guidelines

The World Bank Environmental Health and Safety Guidelines are technical reference documents

with general and industry-specific examples of GIIP, as defined in IFC's PS 3 on Resource Efficiency

and Pollution Prevention.

The EHS Guidelines contain the performance levels and measures that are normally acceptable to

IFC and are generally considered to be achievable in new facilities at reasonable costs by existing

technology. For IFC-financed projects, application of the EHS Guidelines to existing facilities may

involve the establishment of site-specific targets with an appropriate timetable for achieving them.

The environmental assessment process may recommend alternative (higher or lower) levels or

measures, which, if acceptable to IFC, become project- or site-specific requirements.

When host country regulations differ from the levels and measures presented in the EHS Guidelines,

projects are expected to achieve whichever is more stringent. If less stringent levels or measures are

appropriate in view of specific project circumstances, a full and detailed justification for any proposed

alternatives is needed as part of the site-specific environmental assessment. This justification should

demonstrate that the choice for any alternate performance levels is protective of human health and

the environment.

The EHS Guidelines for Construction Materials Extraction include information relevant to

construction materials extraction activities such as aggregates, limestone, slates, sand, gravel, clay,

gypsum, feldspar, silica sands, and quartzite, as well as to the extraction of dimension stone. It

addresses extraction activities supporting construction, civil works, and cement projects. The EHS

Guidelines provide a summary of EHS issues associated with construction materials extraction that

occur during the operational, construction, and decommissioning phases (e.g. air emissions, noise

and vibration, water pollution, respiratory hazards, risks from uncontrolled access and land

instability), along with recommendations for their management.

EHS Guidelines for Electric Power Transmission and Distribution apply to powerlines and are

not deemed relevant to this Project (though it is a gap –see ESAP.



4.2.3 Equator Principles III

The EP are a voluntary set of guidelines developed by leading financial institutions for managing

environmental and social issues in project finance lending. The Principles require observance of the

IFC PS (and the EHS Guidelines) when developing projects in non-high income OECD2 countries.

The guidelines provide an approach to determine, assess and manage environmental and social risk

in project financing.

The Equator Principles relate to:

Principle 1: Review and Categorisation;

Principle 2: Environmental and Social Assessment;

Principle 3: Applicable Environmental and Social Standards;

Principle 4: Environmental and Social management Systems and Equator principles Action Plan;

Principle 5: Stakeholder Engagement;

Principle 6: Grievance Mechanism;

Principle 7: Independent Review;

Principle 8: Covenants;

Principle 9: Independent Monitoring and Reporting; and

Principle 10: Reporting and Transparency.

Financed projects must be undertaken “in a manner that is socially responsible and reflect sound

environmental management practices”. The intention is to ensure that projects are developed in a

site specific manner that is socially responsible and reflects sound environmental management

practices.

4.2.4 World Bank Safeguard Policy of Dams

The WB Operational Policies (“Ops”) have been identified by WB as being particularly important in

ensuring that Bank operations do no harm to people and the environment. There are 10 safeguard

policies (“WB SPs”), comprising the Bank's policy on EIA and policies on: Cultural Property;

Disputed Areas; Forestry; Indigenous Peoples; International Waterways; Involuntary Resettlement;

Natural Habitats; Pest Management; and Safety of Dams.

Operational Policy (“OP”) 4.37: Safety on Dams requires that experienced and competent

professionals design and supervise construction, and that the borrower adopts and implements dam

safety measures throughout the project cycle. The policy also applies to existing dams where they

influence the performance of a project. In this case, a dam safety assessment should be carried out

and necessary additional dam safety measures implemented. OP 4.37 recommends, where

appropriate, that Bank staff discuss with the borrowers any measures necessary to strengthen the

institutional, legislative, and regulatory frameworks for dam safety programs in those countries.

2 Organisation for Economic Co-Operation and Development



5 Status of Compliance and Review Findings This section describes the status of compliance of the Project and summarises key gaps in

compliance. Sections 5.1 to 5.5 effectively report on gaps and compliance as at or about July 2016,

while Section 5.6 reports on progress and compliance with the ESAP as at June 2017.

5.1 Host Country Legislation and Permitting

An ESIA was prepared by Angolan consultants – Progest in collaboration with Fluidex – in order to

fulfil a number of Angolan environmental regulatory requirements. This ESIA report was finalised in

December 2015 following a public hearing. MinAmb awarded an Environmental License to GAMEK

on 17 March 2016, valid (for the Project construction phase) until 16 March 2019. The Environmental

License and ESIA lists a number of conditions with which GAMEK/PRODEL is expected to comply in

the future, especially a quarterly environmental monitoring report to be submitted to MinAmb.

In terms of the Water Law No. 6/02 and Presidential Decree No. 261/11 on Water Quality, GAMEK

may still need to obtain a license to discharge polluted water, including wastewater from the

proposed new sewage works. In addition, Presidential Decree No. 190/12 on Waste Management,

requires that all private or public entities producing wastes must develop a Waste Management Plan.

5.2 IFC Performance Standards

The IFC PS cover eight areas which are viewed as essential aspects of GIIP, i.e. good international

environmental and social performance. Review of the documents available to SRK against the IFC

PS indicates the following:

5.2.1 PS1: Assessment and Management of Environmental and Social Risks and Impacts

In 2015, an ESIA was compiled by Progest in collaboration with Fluidex, as prescribed by Angolan

legal requirements. The ESIA provided the strategic context and a clear motivation for the Project as

one of a series of eight (now seven) hydropower dams on the middle Kwanza. In many respects the

ESIA complies with PS1, though there are significant deficiencies. Details of the ESIA team and

specialists who worked on the ESIA are provided, as required by PS1, which requires external

experts to contribute to the ESIA so as to ensure that appropriately qualified specialists are used.

The baseline description provided in the ESIA is relatively high level, presenting information at a

regional scale with limited focus on local conditions within the Project’s AoI. The baseline is largely

based on a desktop review of existing information, consultation with local and regional organisations

with some field work undertaken, but no detailed baseline monitoring or sampling. Given the short

timespan during which the ESIA was undertaken (3 months), seasonal baseline monitoring would

not have been possible. Difficulties in obtaining good baseline information associated with certain

aspects of the environment (e.g. ecology and air quality) are noted as technical shortcomings in the

ESIA.

A relatively comprehensive list of direct and indirect impacts associated with hydropower projects of

this nature is presented and assessed in the ESIA, indicating an understanding of the types of

impacts that may occur.

A number of villages fall within the Project’s AoI, although little information is provided on the exact

location of these communities, and the assessment of socio-economic impacts on these

communities is relatively generic. For example, the impact of traffic-entrained dust in the villages is

not assessed.



The Project description includes some very technical details (e.g. types of equipment to be utilised),

but does not describe the actual Project components (including location) and construction methods

in a way which allows for the extent and significance of impacts on the local environment (e.g. loss of

habitats) at Caculo Cabaça to be quantified. Impacts were assessed systematically according to a

methodology presented in the ESIA. The extent and significance of the impacts that may actually be

experienced are however difficult to qualify given the lack of:

Detailed local baseline information including e.g. seasonal baseline monitoring of aquatic

ecology and terrestrial biodiversity (flora);

Guideline levels against which e.g. air quality impacts would be assessed;

Modelling of anticipated impacts (e.g. noise - noting that this is not considered critical given the

limited number of sensitive receptors in the area);

A clear indication of which components of the Project have been included (and excluded) in the

assessment, i.e. the Project’s “battery limits”, differentiating between ancillary infrastructure and

associated facilities. An operator’s village, access roads (40 km are planned), borrow pits,

substations and other ancillary infrastructure are all mentioned in the ESIA as well as power

lines (associated facilities), but it is unclear whether these are considered part of the Project

assessed, although the 400 kV transmission lines to Lauca and Catete were almost certainly not

assessed; and

A layout diagram indicating the position and extent of the proposed infrastructure.

This may be the reason for the fairly generic description of impacts in many cases.

The following aspects have not been discussed, assessed and/or rated in the ESIA Report as

required in terms of the IFC PSs:

Ecosystem services, which relate to the benefits stakeholders and communities obtain from

ecological functions and systems. Lenders pay particularly close attention to the assessment of

ecosystem services provided to vulnerable communities, which is warranted in terms of PS1,

PS4 and PS6. These services are of often crucial in areas where people are highly dependent

on the environment;

Land capability of the inundated area and associated opportunities;

Economic displacement of subsistence farmers and others conducting economic activities (e.g.

artisanal diamond mining) in the area (discussed further under PS5); and

Assessment of cumulative impacts (PS1 is clear that the Project should consider cumulative

impacts). Although the impact assessment methodology indicates that cumulative impacts will

be assessed, apart from a brief mention of the cumulative effects of certain impacts by Caculo

Cabaça and Lauca, cumulative impacts are not assessed. However, SRK is aware that a

Cumulative Impact Assessment (“CIA”), arising out of an ESDD of the Cambambe Phase 2

Project, and evaluating cumulative impacts of existing and planned projects on the Kwanza

River from upstream of the Capanda Reservoir to the mouth of the river, has (subsequently)

been completed.

A comprehensive list of mitigation measures has been identified (many of which are generic, but

applicable to the Project). It is unclear whether the impact significance ratings assume the

implementation of the proposed mitigation measures or not.

The ESIA recommends that an Environmental Management Plan (“EMP”) and various

Environmental Monitoring Plans be implemented. It further refers to the need for quality control

during construction and operation of the Project, with brief reference to the ISO 140001



(Environmental Management System) and OHSAS 18001 (Occupational Health and Safety)

standards. An EMP has been developed as one of the EPC Contractors’ documents for the Project.

Details of the monitoring plans are discussed under PS3 below.

Lenders expect that a GIIP-compliant ESIA will clearly identify management plans required for a

Project, and present a framework for the ESMS that will identify and govern the plans and their

implementation during construction and operation. Fairly standard plans that are typically required in

terms of GIIP (for a project such as this) include an EMP, Stakeholder Engagement Plan3 (“SEP”)

including grievance mechanism, Closure and Rehabilitation Plan (“CRP”), Biodiversity Action Plan

(“BAP”), Wastewater Management Plan including treatment, monitoring and reporting, Stormwater

Management Plan, Waste Management Plan (“WMP”), Hazardous Material/Waste Management

Plan, Traffic Management Plan, Recruitment Plan, Air Emissions Control Plan, Noise and Vibrations

Mitigation Plan and Stakeholder Engagement Plan. Not all of these plans need to be submitted

simultaneously with the ESIA Report, but should be described in a framework ESMS (not currently

included in the ESIA).

The ESIA describes the alternatives considered, including an overview of the various hydropower

scheme alternatives (based on a report by Intertechne in 2012) as well as two location alternatives

for the Caculo Cabaça Dam. The alternative position 8 km upstream of the selected (downstream)

position for the dam wall was eliminated as a viable option based on cost. Environmental factors do

not appear to have affected this decision. Additional power that can be obtained from the ecological

power plant associated with the downstream alternative is presented as an additional advantage of

selecting this alternative (although no indication is provided of the magnitude of the difference

between the two ecological plants). Differences in infrastructure required for each of the location

alternatives is described in detail. The option of six (rather than four) generator groups was also

eliminated based on cost. Although the ESIA indicated that the Project will be assessed against the

“no-development” alternative (Alternative Zero) it is not clear that this has been done4.

Stakeholder engagement is a crucial aspect of the ESIA process that allows stakeholders to

engage with the Project, learn about potential impacts, voice their comments and concerns and

obtain responses from the proponent and ESIA team. Stakeholder engagement undertaken during

the ESIA process included a single round of consultation within the villages falling in the Project’s

AoI in both Kwanza North and Kwanza South. Evidently, 50 residents of these villages were

reportedly consulted. However, details of only 14 are provided in the ESIA. Stakeholders highlighted

the lack of basic services and expressed support for the Project, which they believe will stimulate the

local economy and provide employment. While a single round of stakeholder consultation may

satisfy national requirements for an ESIA, it is deficient with regards to GIIP. The nature of the

consultation undertaken and information shared with stakeholders is unclear, and does not seem to

have been undertaken in accordance with an SEP. A non-technical summary of the ESIA has been

produced (as required by Angolan legislation) although it is not clear whether this has been made

available to stakeholders. A recommendation to disclose information about the Project to

surrounding communities is included as a mitigation measure in the ESIA, along with the need for a

public service mechanism (grievance mechanism) to deal with queries, suggestions etc. This

mechanism is not clearly defined.

A programme to monitor and review performance against the EMP/ESMS and implement actions

for continual improvement has not been established by CGGC.

3 The SEP must include records of consultation undertaken for the ESIA (including consultation plan, stakeholder analysis, record of meetings and meeting notes) and a way forward.

4 The assessment of impacts is inherently against baseline conditions, which equates to the “no-development” alternative and

this is not considered a substantial gap.



CGGC provided an environmental and social management plan (the EMP) applicable to the

construction phase, which is a part of EPC contractual documents for this Project. A comprehensive

list of mitigation measures has been identified in this plan. However, the level of detail and

complexity of this plan does not reflect the nature and scale of this Project, and stakeholder

engagement is not included.

Management systems are not in place for the operations phase and it is difficult to gauge PRODEL’s

(the operator) capacity to manage HSE issues during operations.

Recommendations

Undertake more detailed baseline surveys/monitoring for terrestrial ecology (flora and, perhaps,

fauna) and aquatic ecology as well as air quality, particularly in areas within the project footprint

and including seasonal monitoring where appropriate.

Provide a clear Project layout diagram, as well as a clear indication of the components of the

Project (battery limits) assessed in the ESIA. If the impacts of ancillary infrastructure have not

been assessed – include these in the ESIA (or an addendum to the ESIA).

Undertake (commission) a separate ESIA for the 400 kV transmission lines.

Assess impacts on ecosystem services and land capability.

Assess impacts on the subsistence farmers or others undertaking economic activities within the

Project footprint.

Obtain access to the CIA and ensure that relevant mitigation measures are implemented.

Integrate all mitigation measures from the ESIA, conditions in the Technical Report by MinAmb

and the Environmental License as well as IFC EHS requirements into an ESMS applicable to all

phases of the Project. Make allowance for the development of an SEP (including grievance

mechanism), CRP, BAP, Wastewater Management Plan (including treatment), monitoring and

reporting, Stormwater Management Plan, WMP, Hazardous Material/Waste Management Plan,

Traffic Management Plan, Recruitment Plan, Air Emissions Control Plan and Noise and

Vibrations Mitigation Plan.

Include in the ESMS clear procedures for monitoring of all requirements contained in the EIA,

EMP and various plans, as well as IFC EHS Guidelines and conditions of the Environmental

License, including criteria, indicators and measurable events against which implementation can

be monitored.

Demonstrate continuous improvement of environmental performance.

Establish a legal compliance register and undertake an annual legal compliance review. Revise

the legal register to reflect changes to legislative requirements.

Undertake a skills needs assessment for PRODEL’s HSE management team.

Build PRODEL’s HSE capacity if necessary and provide assistance in developing suitable plans,

policies and procedures prior to hand over of the facility to PRODEL. Where possible, align

these plans with those implemented by PRODEL at other hydropower facilities on the Kwanza

River.

Review progress on PRODEL’s HSE systems annually and into the first few years of operation.

Undertake further, structured stakeholder engagement as soon as possible. Develop an SEP in

discussion with the community and disclose to stakeholders. Detail the nature and timing of

consultation/disclosure of information to surrounding communities as well as anticipated public



service (grievance) mechanism. Identify and consider particularly vulnerable groups within the

local communities.

5.2.2 PS2: Labour and Working Conditions

Monthly labour requirements for the duration of the construction phase (2016 – 2023) are provided in

the ESIA, along with the recommendation that preference be given to local and provincial companies

in the identification of subcontractors and service providers, the procurement of materials and labour

recruitment.

Recruitment and working (including accommodation) conditions are generally not addressed in detail

in the ESIA, which shifts responsibility to the EPC Contractor. This is a gap in the ESIA.

SRK was provided with a generic and not Project-specific recruitment policy prepared by CGGC for

overseas projects worldwide, which only includes general policies and rules. In addition, CGGC

provided an Occupational Health and Safety (“OHS”) plan, which is a part of EPC contractual

documents for the Project. This OHS plan includes relatively comprehensive OHS procedures for

the construction phase to eliminate or reduce the risk of industrial accidents and occupational

diseases. However, this OHS plan does not include a grievance mechanism and OHS procedures

for the commissioning phase, as well as Project specific performance indicators and a monitoring

programme.

According to this OHS plan, land mine clearance shall be implemented prior to the commencement

of construction to ensure safe working conditions.

Recommendations

Develop a Recruitment Plan in compliance with IFC requirements.

Commit to applying the laws of Angola prescribing working conditions, including the principles of

equal opportunity and fair treatment. Give preference to the employment of locals and do not

make use of forced or child labour. If required, enter into a collective agreement with unions that

sets out working conditions.

Disclose and implement a grievance mechanism for workers and sub-contractors.

Prepare and implement a stand alone, Project–specific OHS Plan/System, which will have

application during the construction and commissioning phases.

Provide evidence of a land mine clearing certificate for the construction area on both sides of the

river bank.

5.2.3 PS3: Resource Efficiency and Pollution Prevention

Application of resource efficiency principles is evident through the intention to reuse materials5

(e.g. excavated rock as construction material, thereby reducing waste rock and quarrying) and use

“clean” power from Lauca during construction (rather than diesel generators).

Waste management requirements have not been well defined in the ESIA which identifies the

need for the development of a WMP along with an extensive list of relatively generic mitigation

measures for the Management of Products, Effluents and Waste. The ESIA also includes a very

5 Additional opportunities for reuse of materials which have not been identified include:

the potential for harvesting of edible plant material (if any), firewood and medicinal plants by locals from the Project area, before vegetation clearance; and

the potential use of removed vegetation as mulch during rehabilitation rather than disposing of it as waste.



brief Waste Monitoring Plan the purpose of which is not clear. This Waste Monitoring Plan

recommends the identification, classification, quantification and “suitable management” of various

waste streams, with no further indication of what may be suitable.

A number of waste stream have been identified in the ESIA including inter alia waste rock, material

from vegetation clearance, potentially contaminated runoff from concrete batching and workshop

areas, effluent from construction activities, with an indication that waste needs to be stored

appropriately until it can be disposed of. A relatively generic list of criteria is provided for identifying

suitable areas for the storage of waste, avoiding e.g. floodable areas and geotechnically sensitive

areas perspective etc. The ESIA does not map or define these sensitive areas, which those

responsible for waste management (the EPC Contractor) may not be qualified to identify.

Waste treatment and disposal facilities in Angola are known to be deficient and the fate of many

(hazardous) wastes is uncertain once removed from the site. This may make the ultimate disposal of

waste a challenge, unless the contractors are able to establish a suitable waste disposal facility on

site. It is unclear how effluent for the Project (include staff facilities) will be disposed of.

The Project will reduce reliance on fossil fuels and limit national release of GHG emissions. Key

sources of GHG emissions by the Project are clearing of vegetation prior to inundation, limited diesel

consumption during construction and releases from inundated biomass. (Although removal of

vegetation from the inundated area is recommended in the ESIA it is unclear whether this will be

done, or whether there are land mines in this area making this impractical unless the area is be

demined). Rehabilitation and revegetation of degraded areas (in the future) will sequester carbon

and offset emissions. Although rehabilitation of disturbed areas is recommended, no indication is

provided of the extent of the area that will be rehabilitated nor the proposed rehabilitation

methodologies.

There are no major sources (e.g. processing plants, stacks etc.) of pollution. Key pollution risks

include sewage, concrete batch plant washwater, hydrocarbon spills from storage facilities and

workshops, unmanaged domestic and industrial waste disposal, inappropriate storage of chemicals

and hazardous substances, dust/particulates from blasting, quarrying, earthworks, roads and the

surplus material dump and concrete additives. High noise levels and vibrations from blasting and

movement of heavy machinery are also expected; however these impacts would be limited given the

few sensitive receptors in the immediate area. The ESIA includes mitigation measures to manage

most of these potential impacts, which should be included in the EMP and other management plans.

The ESIA includes a Monitoring Plan with criteria/principles for monitoring of water quality

(construction and commissioning phase) and air quality (construction).

Although the parameters, sampling locations and sampling frequency are specified in the water

quality monitoring plan along with the need to make use of certified analysis techniques, no

indication is provided of the acceptable thresholds or guideline levels for the relevant parameters

and no baseline water quality monitoring has taken place. It is thus unclear what the benchmark is

against which water quality will be measured.

The air quality monitoring plan provides more limited information, requires the monitoring of PM10

particles (particulate matter 10 micrometers or less in diameter) during the dry season (frequency or

duration of monitoring not specified) at two locations equidistant from sensitive receptors. The

location of the closest sensitive receptors is not indicated. PM10 concentrations are to be evaluated

against limit values specified in international legislation, which is not defined. The air quality

monitoring plan does not seem adequate to ensure that air quality is properly monitored. The

purpose of the air quality monitoring plan is not clear. Noting the absence of sensitive (community)

receptors in the vicinity, SRK considers it possible that the air quality monitoring plan should focus

more on occupational health.



Recommendations

Develop a WMP including the need for identification, classification and quantification of waste,

as well as the identification of suitable methods and means of disposal. The WMP should also

address waste reduction and opportunities for recycling by contractors able (and with the

required permits) to recycle waste in Angola.

Preferably consolidate the storage of waste into one or a few waste storage areas. Identify areas

likely to be most suitable for waste storage and ensure that the impacts of temporary waste

storage or disposal on site are adequately considered in the ESIA.

If effluent from the Project will be disposed of /discharged into the Kwanza River, determine

effluent discharge standards and implement a (simple) effluent monitoring plan.

Treat wastewater if necessary to ensure that wastewater discharged into the Kwanza River

meets the discharge standards. The treatment methods may include, but are not limited to

separation of dirty and clean water, sedimentation ponds, biochemical treatment, and chemical

treatment.

Update the Water Quality Monitoring Plan to incorporate baseline monitoring as well as

specifying the relevant guideline levels for water quality. Baseline water quality monitoring

should ideally start as soon as possible with the aim of obtaining seasonal baseline

measurements against which the seasonal monitoring can be benchmarked.

Implement an air quality monitoring plan and take appropriate measures to protect occupational

health.

Develop a CRP which defines the best end use for facilities, areas to be rehabilitated and

includes a land disturbance area registry and rehabilitation schedule and budgets. Rehabilitation

should be incremental, commencing during the construction phase.

5.2.4 PS4: Community Health, Safety and Security

A number of villages fall within the Project’s AoI. The ESIA make little reference to community

health, safety and security, other than including recommendations that the most appropriate routes

for the movement of heavy vehicles should avoid residential areas and sensitive receptors /

community facilities such as schools. The ESIA further recommends that the speed of vehicles near

inhabited areas be limited and that safety regulations and signalling of works be implemented on

public roads. This is considered a gap.

The ESIA indicates that dam safety for the maximum seismic activity of the Project (e.g. induced by

filling of the reservoir) must still be verified. An Emergency Response Plan (“ERP”) should address

emergency response procedures for communities downstream of the dam in the case of a dam

break, or surrounding communities in the case of any other major emergency on site.

An influx of workers into the region is likely to have health impacts, e.g. increased incidence of HIV,

which is not discussed in detail in the ESIA.

SRK reviewed ERP documents prepared by CGGC, which are generic corporate ERP documents,

with accompanying policies and principles. No Project specific ERP related with the surrounding

communities has been prepared yet.

Recommendations

Obtain the required independent verification of dam safety (also required by the World Bank

Safeguard Policy for Dams).



Develop an ERP to address emergency response procedures for communities around and

downstream of the dam, in the case of an emergency during construction or operation of the

Caculo Cabaça Hydropower Plant. (This should include a dam break at Lauca.)

Disclose relevant details of the ERP to external stakeholders.

Monitor impacts of the Project on community health and take appropriate measures to mitigate

any impacts, e.g. afford access to Project health care resources and facilities.

5.2.5 PS5: Land Acquisition and Involuntary Resettlement

No specific mention is made in the baseline description of any communities living or farming in the

area that will be affected by the Project footprint (including the area to be inundated). No evidence is

provided of a survey having been undertaken of this area to determine whether it is in fact occupied

or utilised.

Although the impact is not described in the report (and there is thus no indication of the location or

extent of the agricultural lands) the impact summary table contained in the ESIA identifies “Impacts

on agricultural plots” as one of the socio-economic impacts of the Project and identifies the need for

a Compensation Plan. The information provided in this regard is extremely limited and would not

meet the requirements of PS5.

PS5 requires the compilation of a Livelihoods Restoration Plan (“LRP”) or Resettlement Action Plan

(RAP) where economic or physical displacement may occur. IFC requirements6, include a census to

identify persons who will be displaced by the project and calculation of compensation costs.

No information was provided regarding an alleged diamond concession in the inundation area: this

ESAP item needs to be promptly resolved7.

Recommendations

Survey all areas to be affected by the Project footprint to identify and parties that may be

physically or economically displaced.

Inform stakeholders of the boundaries of the inundated area and cut-off date for determining the

need for economic displacement.

Develop a RAP in compliance with the requirements of PS5, addressing both physical and

economic displacement, if required.

5.2.6 PS6: Biodiversity Conservation and Sustainable Management of Living Natural Resources

Although the ESIA make reference to the need to protect biodiversity in terms of local legislation and

policy no specific actions are proposed in this regard.

The baseline information on biodiversity provided in the ESIA is relatively generic, with limited or

no local biophysical data provided. No detailed biodiversity surveys informed the ESIA. This

together with the lack of clarity regarding the position and scale of Project infrastructure allowed only

for a generic assessment of impacts, with no detail provided on the exact nature of the impacts,

extent of vegetation lost, or species of conservation concern that may be affected. SRK considers

the biodiversity baseline to be deficient.

6 Contained in IFC PS5 on Land acquisition and Involuntary Resettlement and IFC Handbook for Preparing a Resettlement Action Plan.

7 SRK has subsequently ascertained that the concession is downstream of the Filomeno da Camara Bridge and, therefore, will not be affected by the Project.



Ecosystem services have not been identified or assessed and a Biodiversity Action Plan (“BAP”)

has not been developed.

Impacts on biodiversity and ecosystem services within the area to be inundated and the Project

footprint are largely unavoidable, although biodiversity impacts on the perimeter of the site can be

managed.

The series of rapids on the Kwanza River could be regarded as a unique ecosystem under threat

from the cumulative impacts of the series of eight (now seven) dams planned for this reach of the

river. Cumulative impacts of the dams on the Kwanza River should be assessed prior to the

development of any new dams and relevant mitigation measures implemented/retrofitted.

In addition to the 16.6 km stretch of the river which will be inundated, a further 10 km stretch

between the dam wall and power plant tailwater discharge point will only receive the 60 m3/s

ecological flow in future. This 10 km portion of the river has a series of rapids in wide beds with deep

pools and provides natural habitat for fauna.

Changes in water flow (which is a key impact) and associated effects on habitat and freshwater

ecology are identified as major impacts in the ESIA. The importance of maintaining the ecological

flow8 as well as reserve flow9 is discussed in the ESIA, noting that flow rates at Caculo Cabaça are

directly governed by discharge from Lauca. (Caculo Cabaça does not provide flood attenuation/

regulation, and can only affect daily (peak) flow rates)

The need to maintain the ecological flow is recognised, although this is not specifically required in

terms of Angolan legislation. An ecological flow of 60 m3/s was defined for this stretch of the river in

accordance with internationally recognised practice, which equates to approximately 10% of the

average annual flow.

Although a generic discussion on the impacts of an altered flow regime on the affected habitats and

the biodiversity they support is provided, the impacts on this portion of the river were not specifically

assessed, presumably based on the assumption that the ecological flow will maintain these

ecosystems.

Recommendations

Develop a BAP aimed at monitoring aquatic and terrestrial habitats and identifying and

implementing measures to reduce impacts and restore biodiversity and ecosystem services. The

BAP must address protection of Red List species.

Conduct a more detailed assessment of provisioning ecosystem services from a livelihoods

perspective and include the results and associated actions in the BAP and RAP.

5.2.7 PS7: Indigenous Peoples

This standard is not considered applicable to the Project.

5.2.8 PS8: Cultural Heritage

It does not appear that a formal heritage assessment was undertaken as part of the ESIA, in

accordance with GIIP standards and guidelines. The scale and nature of earthworks means that it

generally difficult to avoid impacting cultural heritage in the area. If there are any heritage resources,

their relocation and compensation need to be handled in an open and systematic manner.

8 The minimum flow necessary to maintain the watercourse downstream of the hydropower plant which ensures the conservation and protection of freshwater ecosystems. This flow is also considered to maintain the reserve flow that secures water use downstream of the dam (although this is limited due to limited population along the banks of the river )

9 To maintain existing downstream usage of water.



Limited heritage resources were identified in the Project area. The Filomeno da Camara Bridge and

a church (unspecified) are identified as having historical and cultural value, with no archaeological

resources identified in the Project area. The exact location of these features is not indicated clearly

in the ESIA, which provides no indication of how these features were identified or whether a detailed

cultural heritage survey was undertaken. More comprehensive stakeholder engagement may have

identified cultural spaces (as opposed to structures such as bridges and churches).

Recommendations

Commission an independent cultural heritage baseline specialist study to confirm whether there

are likely to be any cultural heritage resources within the Project AoI, including consultation with

relevant authorities and communities. Pending the outcomes of this study, develop a cultural

heritage conservation plan (if necessary) with input from the specialist. Amend the ESIA and

mitigation measures based on the finding of this exercise.

5.3 World Bank/IFC Environmental Health and Safety Guidelines

In some areas IFC PS’s and EHS guidelines are mentioned but not consistently applied in the ESIA

and the EMP, and there is no system or audit trail which demonstrates that the IFC EHS guidelines

have systematically been incorporated into CGGC’s management system and procedures.

IFC EHS guidelines aim to avoid or minimise adverse impacts on human health and the environment

by avoiding or minimising pollution from Project activities, and by promoting reduction of emissions.

More detailed comments on the on the conformance of the Project with the IFC Environmental and

Social Standards and Guidelines are provided below.

Air Emissions

Dust emissions for the Project will be from construction material stockpiles, waste dumps, open

(cleared) areas, material handling and the general movement of vehicles and mobile plant. Watering

of roads, stockpiles and unsealed/unvegetated areas should assist in reducing dust emissions. The

primary source of gaseous emissions for the construction and operations phases of the Project are

machinery, vehicles and generators. Decaying biomass may also generate emissions immediately

after inundation.

The ESIA includes a Monitoring Plan with criteria/principles for monitoring of air quality during

construction. The air quality monitoring plan does not seem adequate to ensure that air quality is

properly monitored. The purpose of the air quality monitoring plan is not clear. Noting the absence

of sensitive (community) receptors in the vicinity, SRK considers it possible that the air quality

monitoring plan should focus more on occupational health. However, vehicular dust generated in

villages along the access road should be monitored.

Recommendations

Ensure that proper air quality management measures are included in the EPC Contractor’s EMP

(if not already included) and are implemented on site.

Implement an air quality monitoring plan and take appropriate measures to protect community

and occupational health.

Noise and Vibrations

High noise levels and vibration from blasting and movement of heavy machinery are expected; with

additional noise sources for the Project including construction activities and the operation of fixed

plant (crushers, compressors, pumps etc.) and vehicles. However, these impacts would be localised

given the absence of sensitive receptors in the immediate area. The EIA report and the EMP outline

noise reduction measures for plant equipment and site operations management for the Project. SRK



notes that the area is heavily vegetated, which will help abate noise. However, vehicular noise

generated in villages along the access road should be monitored.

Recommendations

Include ambient noise monitoring as part of a site environmental monitoring program, with a

focus on occupational and community health.

Water

Adequate surface water resources are available from the Kwanza River and streams near the

Project area. The potential impact of construction activities on water quality in the Kwanza River

presents an environmental risk for the Project. Surface drainage from the Project site flows into this

river drainage system. In addition, there will be various sources of wastewater from the site,

including domestic wastewater from the site camp and offices as well as industrial wastewater from

the concrete plant and machinery maintenance workshop etc. Adequate stormwater and wastewater

management systems will be required to mitigate and manage the potential surface water impacts.

No Project related design and drawings are available at this stage for diversion swales, treatment of

surface run-off, domestic wastewater treatment, and industrial wastewater treatment. The ESIA

report and the feasibility study report only include some generic water management policy and list

some basic measures. Detailed Stormwater and Wastewater Management Plans should be

developed and implemented.

Recommendations


and the Environmental License as well as IFC EHS requirements into an ESMS applicable to all

phases of the Project. Make allowance for the development of various plans including (but not

limited to) a Wastewater Management Plan including treatment, monitoring and reporting, and a

Stormwater Management Plan.

If effluent from the Project will be disposed of/discharged into the Kwanza River, determine




separation of dirty water from clean water, sedimentation ponds, biochemical treatment, and

chemical treatment.

Waste

Waste management requirements have not been well defined in the ESIA, which identifies the

need for the development of a WMP along with an extensive list of relatively generic mitigation

measures for the Management of Products, Effluents and Waste. The ESIA also includes a very

brief Waste Monitoring Plan the purpose of which is not clear. This Waste Monitoring Plan

recommends the identification, classification, quantification and “suitable management” of various

waste streams, with no further indication of what may be suitable.

A number of waste streams have been identified in the ESIA including waste rock, material from

vegetation clearance (and potentially contaminated runoff from concrete batching and workshop

areas, effluent from construction activities among others), with an indication that waste needs to be

stored appropriately until it can be disposed of. A relatively generic list of criteria is provided for

identifying suitable areas for the storage of waste, avoiding e.g. floodable areas and geotechnically

sensitive areas etc. The ESIA does not map or define these sensitive areas, which those responsible

for waste management (the EPC Contractor) may not be qualified to identify.



According to the feasibility study report, there are three major waste dump areas for this Project, of

which two are situated on the left bank and one on right bank. No details are provided of the

anticipated nature or volumes of waste that will be generated, the design of the waste disposal

facilities, environmental controls, etc.

Waste treatment and disposal facilities in Angola are known to be deficient and the fate of many

(hazardous) wastes is uncertain once removed from the site. This may make the ultimate disposal of

waste a challenge, unless the contractors are able to establish a suitable waste disposal facility on

site.

Recommendations



address waste reduction and opportunities for recycling by contractors able (and with the





Land Conversion

This Project will include extensive excavation of construction materials (quarries), which typically

causes major topographical and land-cover changes as well as clearing of vegetation. There is

currently no operational closure planning process in place for the Project, to mitigate the impacts of

land conversion. The ESIA report does outline requirements for the development of a conceptual

closure plan for the Project that should be developed as part of the full ESIA process.

Recommendations

Develop an operational CRP for this Project, consistent with GIIP.

Hazardous Materials/Waste Management

Hazardous wastes are likely to be generated during construction, e.g. waste oil will be generated

through the maintenance of mobile and fixed plant on site. The management and treatment of

hazardous waste is not specifically addressed. It is worth noting that the IFC requirements and

internationally recognised environmental management practice with regards to waste oil is to explore

commercial alternatives for environmentally sound disposal, recycling or reuse. The management

and disposal of hazardous waste should be addressed in an integrated WMP for the Project.

Recommendations



address waste reduction, and opportunities for recycling by contractors able (and with the


OHS, and Community Health and Safety are discussed in PS2 and PS4 respectively.

5.4 Equator Principles III

The EPs are underpinned by the IFC PS, and so only limited comment on the EPs is provided here.

SRK expects that the Project would be categorised as a Category A project (in terms of EP1),

warranting a comprehensive ESIA.

Notable deficiencies include the following:



The impact identification and evaluation process is systematic but is not considered to be

comprehensive or particularly site or Project specific. A number of Project elements were not

assessed in the ESIA. Furthermore, cumulative impacts were not considered although a

separate CIA (commissioned for the Cambambe Phase 2 Project) has been completed;

Labour and workplace health and safety impacts are only marginally assessed in the ESIA;

The ESIA did not include a sufficiently detailed EMP, the development of which is a mitigation

measure identified in the ESIA (as well as development of an ESMS);

Stakeholder engagement during the ESIA may have satisfied Angolan requirements, but is

considered deficient in terms of GIIP. No interim report (such as a Scoping Report) capturing

issues and presenting proposed terms of reference was compiled or released;

Grievance mechanisms for the community are not yet adequately formalised; and

The ESIA undertaken by Progest Lda in collaboration with Fluidex, Lda was not independently

reviewed.

5.5 World Bank Safeguard Policy for Dams

A stand alone dam safety assessment was not undertaken; however the risk of dam failure is

considered low based on various discussions of seismic in the Feasibility Study report prepared by

Changjiang Survey, Planning, Design and Research Co., dated July 2015. SRK notes that most

components of this Feasibility Study report were derived from two technical studies prepared by

COBA in December 2014 and Intertechne Consulting in September 2012 respectively. A technical

peer review on this Feasibility Study report was conducted by China International Engineering

Consulting Co. (“CIEC”), which provides considerable assurance with respect to dam failure.

However CIEC comments that seismotectonic measures still need to be considered during detailed

construction design phase given the importance of this Project to Angola.

5.6 ESAP: Progress and Performance June 2017

This section reports on progress and performance against the key actions listed in the original

ESAP, reported against the IFC PS. Key new actions are provided, with a comprehensive list (often

pertaining to subsequent performance review and assessment) presented in the ESAP in Appendix

A.

5.6.1 IFC PS 1: Assessment and Management of Social and Environmental Risks and Impacts

A number of deficiencies (gaps) were identified in the ESIA Report and action items to address

these gaps are included in the ESAP. SRK anticipates that independent Environmental and

Social consultants – perhaps based in Angola - may need to be appointed to address these

environmental and social impacts. To date, there has been very little progress in this regard and

action will need to be taken very soon to ensure compliance with the deadlines prescribed in the

ESAP. A separate ESIA for the proposed 400 kV transmission line(s) is also required, though

GAMEK is responsible for this ESAP item.

Prior to commencing operation, an Operational Environmental License for the Caculo Cabaca

Hydropower Project, as prescribed in terms of Decree No. 59/07, will need to be obtained.

The CIA Report was finalised in June 2016. The report includes commitments to mitigate

significant (material risk) impacts associated with Caculo Cabaca to acceptable levels. The key

pertinent recommendation is to avoid peaking at Caculo Cabaca, i.e. to operate Caculo Cabaca



as a baseload power plant. A further recommendation is to confirm the approach to, and process

for, a biodiversity offset. Action will need to be taken to ensure adequate progress in the

implementation of these recommendations in order to remedy this material non-compliance with

GIIP.

Baseline monitoring (e.g. of flora, ichthyofauna [fish], water quality, air quality, etc.) is also

required to provide a benchmark again which future activities and associated impacts can be

measured. An Integrated Monitoring Programme should be compiled and monitoring should

commence as soon as possible.

CGGC confirms that an integrated HSE management system will be compiled and implemented.

ISO certification will be sought. SRK recognises that more time is required to formulate the HSE

management system, as indicated in the ESAP. It is important that all legal, permitting and GIIP

(e.g. IFC) requirements are documented in the ESMS, and actioned accordingly. It is important

that the ESMS functions as a system directing action through a Plan-Do-Check-Act (“PDCA”)

continuous improvement cycle, and is not just a repository of documentation.

CGGC is committed to compiling and implementing numerous environmental management

plans, mainly to manage physical impacts. Rapid progress is required so that these plans can

be implemented. CGGC advises that CENOR will compile an ESMP, and SRK was provided

with a Draft ESMP. The ESMP should be implemented as soon as possible.

A legal compliance register must be compiled and regularly updated, and annual legal

compliance reviews undertaken, preferably by an independent consultant.

Capacity building, mostly of PRODEL’s SHEQ management team will be required in future, but

is not ESAP action item which warrants immediate attention. However, CGGC will clearly need

to recruit and train a much larger and better resourced HSE team as construction ramps up.

Current stakeholder engagement activities appear to occur on an ad hoc basis. Noting that

stakeholder engagement during the ESIA was inadequate, it is crucial that a structured regional

programme of engagement commences as soon as possible. The goal is to formulate a

sustainable programme to build capability for various stakeholders. The lack of stakeholder

engagement is a material non-compliance with GIIP. A visit to the nearest community at Yapepe

indicated that this community is aware of the Project. However, a meeting with the Cambambe

Municipal Administrator suggested that he may not be fully aware of the status of the Project.

Various plans will also need to be disclosed to stakeholders.

5.6.2 IFC PS 2: Labour and Working Conditions

CGGC advises that they will comply with Angolan labour law, which, inter alia, respects the

rights of workers to join a Trade Union. However, CGGC advise that a Trade Union may (or will)

not be permitted, a material non-compliance with GIIP. GIIP also requires compliance with

International Labour Organisation (“ILO”) conventions. Accommodation conditions and food are

expected to improve once permanent accommodation structures have been constructed.

CGGC reported no fatal injuries or Lost Time Injuries (“LTIs”) during the reporting period to June

2017. However, no documentation pertaining to injuries was available and SRK is not able to

corroborate claims that no injuries occurred: experience on other projects with similar sized

workforces suggests that some LTIs would be recorded. Safety signage was prominently

displayed on site and daily safety briefings are conducted. New recruits reportedly undergo a 16-

hour induction programme, though SRK only had sight of a limited number of induction

documents.



CGGC will give preference to the employment (and training) of local workers, currently

comprising roughly 60% of the workforce, a proportion which will need to increase significantly

as mobilisation of the workforce ramps up to be GIIP compliant.

A grievance mechanism for employees has been implemented, and CGGC advises that any

complaints are directly dealt with: this lack of anonymity may have the effect of suppressing

grievances. There is neither documentation nor statistics to facilitate investigation of trends

regarding grievances (including compliments and suggestions) submitted. The grievance

mechanism, therefore, needs to be improved. A grievance mechanism for surrounding

communities is also required.

CGGC’s Corporate Social Responsibility (“CSR”) initiatives also appear to be somewhat ad hoc

and reactive. In this impoverished area, communities’ demands might be impossible to satisfy,

and CGGC should prepare a structured and targeted CSR programme, which will also serve to

decide which CSR activities CGGC will and will not support. Managing community expectations

is important in this regard. During a visit to the Yapepe village, the villagers requested a clinic, a

school and clean water supply from CGGC.

Only a small proportion of the land has been demined, mainly the footprint of various roadways

and the temporary camp area; this could lead to fatalities and constitutes a material non-

compliance, which needs to be addressed immediately so that this action item can be closed-

out.

5.6.3 IFC PS 3: Resource Efficiency and Pollution Prevention

Waste is being managed in a fairly rudimentary manner. Wastewater is not treated prior to

discharge to the environment, and waste including hazardous waste, is disposed of in an unlined

landfill. SRK is not aware of any waste recycling initiatives initiated by CGGC. Current waste

management practices will improve once new (planned) facilities are constructed. These

facilities must be located well above the appropriate (e.g. 1:100) floodline. Though not

considered a material risk, waste management onsite is not deemed compliant with GIIP. The

(poor) quality of untreated effluent is not measured nor known, but will almost certainly not be

compliant with Angolan standards. Impacts on downstream community users are not known.

5.6.4 IFC PS 4: Community Health, Safety and Security

CGGC advise that Changjiang Institute of Survey, Planning, Design and Research will design

the dam, but that design has not yet been finalised. Nevertheless, SRK recommends that, to

comply with GIIP, an independent study to review the Changjiang Institute of Survey, Planning,

Design and Research’s design and verify dam safety be commissioned.

A set of draft ERPs has been compiled by CGGC; however, they lack project specific

information, and emergency mitigation measures, etc. The modified and revised final versions,

in compliance with GIIP, must be disclosed to stakeholders, including surrounding communities

and officials.

5.6.5 IFC PS 5: Land Acquisition and Involuntary Resettlement

It is probably the case that - as reported by CGGC - no communities will be physically or

economically displaced, and no homes are known to be located in the area which will be

inundated. However, this is a critical GIIP concern and it is imperative that the area to be

inundated is physically surveyed and groundtruthed to definitively confirm whether any form of

displacement or adverse consequences for livelihoods will occur or not, and to remedy this



material non-compliance. The Yapepe soba (chief) advised that communities frequently

gather fruit near Caculo Cabaca mountain, and cross the Kwanza River to access this area. If

displacement will occur, a LRP will be required.

5.6.6 IFC PS 6: Biodiversity Conservation and Sustainable Management of Living Natural Resources

A BAP should be prepared and biodiversity monitoring should be a component of the Integrated

Monitoring Programme. The absence of biodiversity monitoring data is a material non-

compliance with GIIP. Note that at Lauca and Cambambe, an Angolan parastatal body, the

Institute for Biodiversity and Conservation Areas (Instituto Nacional de Biodiversidade e Áreas

de Conservação, “INBAC”) is co-ordinating the biodiversity offset process, which may take a

number of years to implement. CGGC should liaise with INBAC to confirm the biodiversity offset

process at Caculo Cabaca and will almost certainly need to appoint a (local) biodiversity

consultant to assist with offset planning.

5.6.7 IFC PS 8: Cultural Heritage

An independent heritage study must be commissioned, in compliance with GIIP, which assigns

significant value to understanding cultural and heritage impacts.



6 Conclusions and Recommendations

6.1 Conclusions

SRK was appointed to conduct a High Level Gap Analysis to determine the extent of compliance of

the ESIA and other supporting documentation with GIIP. The ESIA was undertaken to comply with

host country legislation but additional work is required to make progress towards meeting GIIP.

A review against the IFC PS and EP identified a number of key gaps (as at July 2016), which are

summarised below. Material gaps are listed in italics:

The baseline information on biodiversity provided in the ESIA is relatively generic, with limited to

no local biophysical data provided. No detailed biodiversity surveys informed the ESIA and SRK

considers the biodiversity baseline to be deficient.


The Project’s “battery limits”, i.e. components of the Project included (and excluded) from the

ESIA, differentiating between ancillary infrastructure and associated facilities, are not clearly

defined and/or assessed.

A clear layout diagram of the Project infrastructure and associated work areas is not provided.

As such the extent of the Project footprint is not clearly defined.

The discussion and assessment of many impacts, as well as the mitigation measures identified

are relatively generic, and not linked to the local environment or exact location of the Project

infrastructure (where required).

Land capability of the inundated area and associated opportunity costs are not discussed.

Cumulative impacts have not been assessed and/or incorporated.

An EMP (and Framework ESMS) and associated plans required to comply with GIIP have not

yet been developed.

Management systems are not in place for the operations phase and it is difficult to gauge

PRODEL’s (the operator) capacity to manage HSE issues during operations.

Stakeholder engagement undertaken during the ESIA does not comply with GIIP.

Grievance mechanisms for workers and the community are not yet adequately formalised.

A stand-alone, Project-specific OHS Plan/System are not yet developed.

Potential on-site land mines pose a threat to the safety of labours during construction.

Recruitment and working (including accommodation) conditions are generally not addressed in

detail in the ESIA, which shifts responsibility to the EPC Contractor. This is a gap in the ESIA.

Waste management and disposal procedures are not clearly defined in the ESIA, and areas to

be avoided when establishing waste storage areas have not been mapped.

Guidelines or baseline levels against which ongoing (e.g. water and air quality) monitoring

should be benchmarked are not provided.

Although rehabilitation of disturbed areas is recommended, no indication is provided of the

extent of the area that will be rehabilitated or the proposed rehabilitation methodologies.

Community health, safety and security are not assessed in the ESIA.



Dam safety for the maximum seismic activity of the Project (e.g. induced by filling of the

reservoir) must still be verified.

No evidence is provided of a survey having been undertaken of the Project area to determine

whether it is occupied or where economic activities (e.g. agriculture, artisanal diamond mining)

are taking place.

Economic displacement of subsistence farmer in the area is not adequately addressed.

No RAP or Compensation Plan is in place to address the agricultural activities reportedly taking

place within the Project footprint.


There is uncertainty regarding the presence and location of cultural heritage resources within the

Project footprint. There is no evidence of a heritage survey having been undertaken.

6.2 Recommendations: July 2016

The initial suite of key recommendations to address these gaps is as follows:

Undertake more detailed baseline surveys/monitoring for terrestrial ecology (flora and, perhaps,

fauna) and aquatic ecology as well as air quality, particularly in areas within the Project footprint

and including seasonal monitoring where appropriate.

Provide a clear Project layout diagram, as well as a clear indication of the components of the

Project (battery limits) assessed in the ESIA. If the impacts of ancillary infrastructure have not

been assessed – include these in the ESIA (or an addendum/supplement to the ESIA).

Undertake (commission) a separate ESIA for the 400 kV transmission lines.

Assess impacts on ecosystem services and land capability

Assess impacts on the subsistence farmers or others undertaking economic activities within the

Project footprint.

Obtain access to the CIA and ensure that relevant mitigation measures are implemented.


and the Environmental License as well as IFC EHS requirements into an or ESMS applicable to

all phases of the Project. Make allowance for the development of a SEP including grievance

mechanism, CRP, BAP, WMP (including treatment, monitoring and reporting), Stormwater

Management Plan, Traffic Management Plan, Recruitment Plan, Air Emissions Control Plan and

Noise and Vibrations Mitigation Plan.

Include in the ESMS clear procedures for monitoring of all requirements contained in the ESIA,

EMP and various plans, as well as IFC EHS Guidelines and conditions of the Environmental

License, including criteria, indicators and measurable events against which implementation can

be monitored.

Demonstrate continuous improvement of environmental performance.

Establish a legal compliance register and undertake an annual legal compliance review. Revise

the legal register to reflect and changes to legislative requirements.

Undertake a skills needs assessment for PRODEL’s HSE management team.

Build PRODEL’s HSE capacity if necessary and provide assistance in developing suitable plans,

policies and procedures prior to hand over of the facility to PRODEL. Where possible, align



these plans with those implemented by PRODEL at other hydropower facilities on the Kwanza

River.

Review progress on PRODEL’s HSE systems annually and into the first few years of operation.

Undertake further, structured stakeholder engagement as soon as possible.

Develop a SEP in discussion with the community and disclose to stakeholders. Detail the nature

and timing of consultation/ disclosure of information to surrounding communities as well as

anticipated public service (grievance) mechanism. Identify and consider particularly vulnerable

groups within the local communities.

Develop a Recruitment Plan in compliance with IFC’s requirements.

Commit to applying the laws of Angola prescribing working conditions, including the principles of

equal opportunity and fair treatment. Give preference to the employment of locals and do not

make use of forced or child labour. If required, enter into a collective agreement with unions that

sets out working conditions. Disclose and Implement a grievance mechanism for workers and

sub-contractors.


Prepare and implement and a stand-alone Project–specific OHS Plan/System, which will have

application during the construction and commissioning phases.


Develop a WMP. Include the need for identification, classification and quantification of waste, as

well as the identification of suitable methods and means of disposal. The WMP should also

address waste reduction and opportunities for recycling.




If effluent from the Project will be disposed of /discharged into the Kwanza River, determine




separation of dirty water from clean water, sedimentation ponds, biochemical treatment, and

chemical treatment. Update the Water Quality Monitoring Plan to incorporate baseline

monitoring as well as specifying the relevant guideline levels for water quality. Commence

baseline water quality monitoring as soon as possible with the aim of obtaining seasonal

baseline measurements.

Implement an air quality monitoring plan and take appropriate measures to protect community

and occupational health.

Implement a noise monitoring plan with an emphasis on appropriate measures to protect

community and occupational health.

Develop a CRP which defines the best end use for facilities, areas to be rehabilitated and

includes a land disturbance area registry and rehabilitation schedule and budgets. Rehabilitation

should be incremental, commencing during the construction phase.

Obtain the required independent verification of dam safety (also required by the World Bank

Safeguard Policy for Dams).



Develop an ERP to address emergency response procedures for communities around and

downstream of the dam, in the case of an emergency during construction or operation of the

Caculo Cabaça Hydropower Plant. (This should include a scenario for a dam break at Lauca.)

Disclose relevant details of the ERP to external stakeholders.

Monitor impacts of the Project on community health and take appropriate measures to mitigate

any impacts, e.g. afford access to Project healthcare resources and facilities.

Survey all areas to be affected by the Project footprint to identify and parties that may be

physically or economically displaced.

Provide evidence that the licensed diamond mining company does not operate in the Caculo

Cabaça inundation area.

Inform stakeholders of the boundaries of the inundated area and cut-off date for determining the

need for economic displacement.

Develop a RAP in compliance with the requirements of PS5, addressing both physical and

economic displacement, if required.

Develop a BAP aimed at monitoring aquatic and terrestrial habitats and identifying and

implementing measures to reduce impacts and restore biodiversity and ecosystem services. The

BAP must address protection of Red List species.

Conduct a more detailed assessment of provisioning ecosystem services from a livelihoods

perspective and include the results and associated actions in the BAP and RAP.

Commission an independent cultural heritage baseline specialist study to confirm whether there

are likely to be any cultural heritage resources within the Project AoI, including consultation with

relevant authorities and communities. Pending the outcomes of this study, develop a cultural

heritage conservation plan (if necessary) with input for the specialist. Amend the ESIA (or

supplementary document) and mitigation measures based on the finding of this exercise.

Although not an ESAP requirement, to comply with best practice, SRK also recommends that CGGC

formulates and implements a CSR programme.

6.3 Recommendations: June 2017

The most recent (and applicable) suite of key recommendations, stipulating the proposed

management measures and timelines for resolution of key technical GIIP non-compliances, are

documented in the ESAP in Appendix A. Some pertinent observations as regards implementation of

the ESAP are as follows:

Generally, it is evident that CGGC is aware of HSE aspects of the Project. There are 42 ESAP

action items and SRK recognises that at this early phase of the Project it is unrealistic to expect

many actions to be closed-out: the deadlines in the ESAP reflect this. Very significant and rapid

progress will be required to avoid a large number of non-compliances.

GAMEK is assigned responsibility for delivery of a number of ESAP action items. However, in

practice, GAMEK has limited resources and will expect CGGC to attend to action items assigned to

GAMEK.

The ESAP clearly presents items which need to be actioned, and certain items need to be prioritised

to meet 2017 deadlines. These include further baseline surveys and monitoring, compilation /

completion of selected management plans, wide-ranging stakeholder engagement, as well as

implementation of a comprehensive grievance mechanism, acquisition of a demining certificate,



improved waste management practices and facilities, considering disclosure of the ERP,

confirmation of potential resettlement requirements including a survey to confirm any form of

physical or economic displacement in the inundated area, liaison with INBAC to confirm the

biodiversity offset process, and an independent heritage study.

Many deadlines expire between formal audits and SRK envisages that evidence of compliance

(mainly reports and data) will be submitted for review during the periods between audits. SRK

therefore recommends that, in addition to formal audits, allowance is made for high level review of

these documents.

To ensure compliance with GIIP, ongoing compliance reviews of the ESAP at the following intervals

are recommended:

Regular Reviews – every six months till completion of construction and commissioning; and

Operational Review – annually after operation commences till final maturity date, which is

defined in the facility agreement.

Prepared by Reviewed by

Chris Dalgliesh Sue Reuther

Partner and Principal Consultant Associate Partner and Principal Consultant

All data used as source material plus the text, tables, figures, and attachments of this document

have been reviewed and prepared in accordance with generally accepted professional

environmental practices.



Appendices



Appendix A: Environmental and Social Action Plan



Caculo Cabaça Hydropower Project (the “Project”) – Environmental and Social Action Plan (“ESAP”)

1. Definitions:

“Agent” means ICBC.

“GAMEK” means Gabinete de Aproveitamento do Médio Kwanza (GAMEK), a component body of MINEA existing under the laws of the Republic of Angola.

“EIS” means the environmental impact study finalised in December 2015, prepared by Progest & Fluidex, Lda of Angola.

“Environmental Consultant” means SRK Consulting China Ltd. (SRK) or such other independent environmental expert as may be appointed from time to

time by the Agent to provide certain advice and reports in relation to the compliance of the Project and the Associated Facilities with the ESAP and the

Performance Standards and Environmental Guidelines.

“Environmental License” means the environmental license dated March 17, 2016, relating to the Project and issued by the Ministry of Environment.

“EPC Contract” means the contracts regarding the civil works for the dam wall construction and the procurement, installation and commissioning of

electromechanical equipment for the hydroelectric power plant in Caculo Cabaça.

“EPC Contractor” means the consortium consisting of China Gezhouba Group Co.(“CGGC”), Boreal Investments Ltd., and CGGC & Niara-Holding Lda., and

any successor of such consortium or its members under the EPC Contract.

“ESMP” means environmental and social management plan with respect to the Project and the Associated Facilities.

“INBAC” means an Angolan parastatal body, Institute for Biodiversity and Conservation Areas (Instituto Nacional de Biodiversidade e Áreas de

Conservação), which is co-ordinating the biodiversity offset process in the Kwanza River.

"Lenders Group standards" means Equator Principles, IFC PS (2012), The World Bank Environmental Health and Safety Guidelines, World Bank Safeguard

Policy Safety of Dams (OP 4.37, 2001) and any applicable law or regulation having the force of law in the Country relating to pollution or protection of the

environment or harm to or the protection of human health of animals or plants.

“MINAMB” means the Ministry of Environment of the Republic of Angola (Ministério do Ambiente da República de Angola) and any successor of such

ministry.

“MINEA” means the Ministry of Energy and Water of the Republic of Angola (Ministério da Energia e Águas da República de Angola) and any successor of

such ministry.

“Operator” means Produção de Electricidade (National Company for Electricity Production - PRODEL)), and any other entity duly designated by MINEA or

any other competent public authority in the Republic of Angola to operate the Project



“PRODEL” means Produção de Electricidade (National Company for Electricity Production - PRODEL).

“Project” means Caculo Cabaça Hydropower Project on the Kwanza River in Angola.

“Power Transmission Lines” means any transmission lines for electricity including poles, substations and other related infrastructure to be installed,

enlarged, rehabilitated, relocated and/or operated in connection with the implementation of the Project (excluding any power transmission lines that will be

installed under the scope of work of the EPC Contract).

“World Bank Group” means an organization consisting of the International Bank for Reconstruction and Development (IBRD), the International Development

Association (IDA), the International Centre for Settlement of Investment Disputes (ICSID), the International Finance Corporation (IFC) and Multilateral

Investment Guarantee Agency (MIGA).

2. ESAP Review

The ESAP Review Matrix below assesses progress against each (current) ESAP action item and proposes four categories of amendment to the ESAP, as

follows:

Actions which have lapsed and/or where full compliance has been achieved and which, consequently, can be removed from the ESAP are shaded in grey;

Actions which are still valid but have deadlines in the future are retained in the ESAP and remain (largely) unaltered;

Actions where only partial compliance can be demonstrated and which should be retained in the ESAP for assessment in subsequent reviews are

assigned revised deadlines indicated in green. Actions not implemented within the original deadline set in the ESAP are indicated in red; and

Any new actions (largely interim actions to ensure progress towards meeting ultimate deadlines) and/or gaps and associated corrective actions for

incorporation into the ESAP, typically in response to new Lenders Group standards and/or alterations to the project, are indicated in green.



Environmental and Social Action Plan

# Required Action Responsibility Schedule Assessment of Progress (June 2017)

PS 1: Assessment and management of Environmental and Social Risks

1. Undertake more detailed baseline surveys/monitoring for terrestrial ecology (flora and, perhaps, fauna) and aquatic ecology as well as air quality, particularly in areas within the project footprint and including seasonal monitoring where appropriate

The EPC Contractor

Nov 1 2017 CGGC correctly notes that this should have occurred or been considered in the ESIA Report. Unfortunately, it was not, and is a gap which has to be closed to ensure compliance with GIIP. Almost certainly this work will have to be undertaken by environmental consultants and it is probable that select local (Angolan) consultants will be equipped to do most of this work, with the possible exception of air quality monitoring. To date, there has been very little progress in this regard and action will need to be taken very soon to and also to characterise a meaningful pre-construction baseline and ensure compliance with the deadline prescribed in the ESAP.

An Integrated Monitoring Programme should be compiled and monitoring should commence as soon as possible.

2. Include in the ESIA (or supplementary document) a clear project layout diagram, as well as a clear indication of the components of the project (battery limits) assessed in the ESIA. If the impacts of ancillary infrastructure have not been assessed – include these in the ESIA (or an addendum to the ESIA).

The EPC Contractor

Nov 1 2017 CGGC provided a schematic layout indicating the main components of the project and advised that these were all assessed in the ESIA. If new components are added (at a later stage) these will need to be assessed and a separate Environmental License may be required. SRK therefore recommends that CGGC confirms that all project components were assessed in the ESIA and authorised in the Environmental License, so that this item can be closed-out.

3. For the 400 kV transmission lines, a separate ESIA needs

GAMEK with the support of the EPC contractor

Nov 1 2019 Noting that ESIAs can take some time to complete, the process to appoint a consultant to assess the impacts of the transmission line (s) should be completed soon. Though GAMEK is nominally responsible for the ESIA, SRK’s experience is that CGGC will have to take responsibility for delivery and costs of the ESIA.




to be undertaken to implement

4. Include in the ESIA (or supplementary document) the assessment of impacts on ecosystem services and land capability

The EPC Contractor

Nov 1 2017 CGGC correctly notes that this should have occurred or been considered in the ESIA Report. Unfortunately it was not, and is a gap which has to be closed to ensure compliance with GIIP. Almost certainly this work will have to be undertaken by environmental consultants and it is probable that select local (Angolan) consultants will be equipped to do most of this work. To date, there has been very little progress in this regard and action will need to be taken very soon to and also to characterise a meaningful pre-construction baseline, record land capability (e.g. agricultural potential) and ensure compliance with the deadline prescribed in the ESAP.

5. Include in the ESIA (or supplementary document) an assessment of impacts on the subsistence farmers or others undertaking economic activities within the Project footprint and the access route to Caculo Cabaca mountain

GAMEK with the support of the EPC contractor to implement

Nov 1 2017 CGGC correctly notes that this should have occurred or been considered in the ESIA Report. Unfortunately it was not, and is a gap which has to be closed to ensure compliance with GIIP. Almost certainly this work will have to be undertaken by environmental consultants and it is probable that select local (Angolan) consultants will be equipped to do most of this work. To date, there has been very little progress in this regard and action will need to be taken very soon to and also to characterise a meaningful pre-construction baseline and ensure compliance with the deadline prescribed in the ESAP. Note that the Yapepe (village) soba (chief) advised that communities frequently gather fruit near Caculo Cabaca Mountain.

6. Obtain the Operational Environmental License for the Caculo Cabaca Hydropower Project prescribed in terms of Decree No. 59/07 once compliance with all the requirements of the ESIA has been demonstrated.

GAMEK / PRODEL with the support of the EPC contractor to implement

To be confirmed

No progress is required on this item at present.

7. Ensure that relevant mitigation measures in the Cumulative Impact Assessment (“CIA”)


Nov 1 2017 From work on the Lauca and Cambambe Projects, SRK understands that most aspects of the Cumulative Impact Assessment (“CIA”) have been closed out and the CIA Report was finalised in 2016. The report includes commitments to mitigate significant (material risk) impacts, presumably including those applicable to Caculo Cabaca, to acceptable levels.




are considered The key pertinent recommendation is to avoid peaking at Caculo Cabaca, i.e. to operate Caculo Cabaca as a baseload power plant. A further recommendation is to confirm the approach to, and process for, a biodiversity offset measure to protect the three endemic fish species only in the mainstream channels, rocky pools, rapids of the middle Kwanza River. Another further study is required to find out similar habitats in other rivers if the extinction of these three endemic fish species is unavoidable due to the loss of rapids in the middle Kwanza River by these dams.

The final CIA includes a commitment matrix outlining key actions and responsibilities by each of the key stakeholders, as well as a schedule for implementation. Technical meetings regarding the implementation of the CIA were concluded in October 2016.

On 20 December 2016 the National Institute of Hydraulic Resources (“INRH”) confirmed its commitment to implementing the recommendations of the CIA, notably 1) flow management in the Kwanza River Basin, 2) inclusion of biodiversity and ecological aspects in flow management plans and 3) monitoring (letter 342/DPRHH/DG.INRH/MINEA/2016).

On 2 January 2017 INBAC confirmed its commitment regarding its involvement in the implementation of (biodiversity related) mitigation related to cumulative impacts of hydroelectric projects in the Kwanza Basin (letter 235/INBAC.MINAM/2016).

On 18 May 2017 PRODEL confirmed their commitment to participating in the integrated management of the Kwanza Basin (letter Ref. 001415/441/GPCA-GQSSA/2017).

8. Integrate all mitigation measures from the ESIA, conditions in the Technical Report by MinAMB and the Environmental License as well as International Finance Corporation (“IFC”) Environmental, Health and Safety (“EHS”) requirements into an or ESMS applicable to all phases of the Project.

The EPC Contractor

May 1 2018 It is important that all legal, permitting and GIIP (IFC) requirements are documented in the ESMS, and actioned accordingly. To date no demonstrable progress has been made on this item. CGGC confirms that an integrated HSE management system will be compiled and implemented. ISO certification will be sought. It is important that the ESMS functions as a system directing action through a Plan-Do-Check-Act (“PDCA”) continuous improvement cycle, and is not just a repository of documentation.

CGGC advises that CENOR, a Portuguese consultancy, has been appointed to compile an Environmental and Social Management Plan (ESMP) and a draft ESMP was provided as evidence of progress. The ESMP includes elements of an ESMS, but is not entirely coherent in SRK’s opinion. CGGC will have to implement the ESMP and ESMS so they need to have a clear understanding of these documents and their purposes, and to instruct and/or request CENOR to make changes as appropriate.

9. Make allowance for the development of (but

The EPC Contractor

Nov 1 2017 CGGC advises that they are committed to compiling and implementing numerous environmental management plans, mainly to manage physical impacts. Rapid progress is required so that these plans can




not limited to) the following:

Wastewater Management Plan including treatment, monitoring and reporting;

Traffic Management Plan;

Stormwater Management plan;

Waste Management Plan (“WMP”); and

Hazardous Material/Waste Management Plan.

Recruitment Plan;

Stakeholder Engagement Plan (“SEP”);

Air Emissions Control Plan;

Noise and Vibrations Mitigation Plan; and

Closure and Rehabilitation Plan (“CRP”)

be implemented. A draft ESMP was provided as evidence of progress. The ESMP should be updated and implemented as soon as possible.

In essence the ESMP comprises:

1. A generic construction phase ESMP mainly focused on management of on-site activities by implementing fairly standard mitigation measures;

2. Some elements of an ESMS; and

3. A framework for some monitoring and some management plans, which still need to be more fully prepared.

SRK’s opinion is that the ESMP demonstrates good progress but that most of the individual plans in the ESMP should be reviewed to ascertain which require further work to elevate them to the standard suited to a project of this scale. CENOR has been appointed to prepare a Construction Waste Management Plan, Deforestation Plan and a Site Rehabilitation Plan.

Some plans are more urgent that others (e.g. Recruitment Plan, SEP) while others are less urgent (e.g. CRP).

Many plans will also need to consider off-site management measures, e.g. significant traffic, noise and air quality impacts (risks) in villages along transport routes.

10. Make allowance for the development of Biodiversity Action Plan (“BAP”).

The EPC Contractor

May 1 2018 Work on the BAP should commence.




11. Include clear procedures for (management) review of all requirements contained in the ESIA, EMP and various plans in the ESMS, as well as IFC EHS Guidelines and conditions of the Environmental License, including criteria, indicators and measurable events against which implementation can be monitored.

The EPC Contractor

May 1 2018 A procedure (s), probably in the ESMS, to document and record implementation of these requirements must be formulated.

12. Demonstrate continuous improvement of environmental performance.

The EPC Contractor

Nov 1 2017 and annually

CGGC’s ESMS must include a system to ensure continuous improvement. This may include management commitment to periodic management reviews of the ESMS.

13. Establish a legal compliance register and undertake an annual legal compliance review. Revise the legal register to reflect and changes to legislative requirements.

The EPC Contractor


Various licenses may be required for this project, including water use permit, and waste discharge permit. A legal register is required to monitor changing HSE legislation and regulations in Angola, identity permitting/licensing requirements and ensure compliance. CGGC advises that a risk control office has been established under the business and contract department to look into legal compliance of this project.

SRK’s experience is that this is a very complex task and could be outsourced to an independent consultant.

14. Undertake a skills needs assessment for PRODEL’s HSE management team.

The EPC Contractor

At least 2 years before completion of construction.

No progress is required on this item during this review.




15. Build PRODEL’s HSE capacity if necessary and provide assistance in developing suitable plans, policies and procedures prior to hand over of the facility to PRODEL. Where possible, align these plans with those implemented by PRODEL at other hydropower facilities on the Kwanza River.

The EPC Contractor

Prior to hand over of the facility to PRODEL.


16. Review progress on PRODEL’s HSE systems annually and into the first few years of operation.

The EPC Contractor

At least 2 years of operation.


17. Undertake further, structured stakeholder engagement as soon as possible.

The EPC Contractor

Aug 1 2017

The goal of stakeholder engagement plan is to formulate a sustainable program to build capability for various stakeholders, and eventually the affected communities’ livelihoods are continuously improved, ideally even after the end of the project. Current stakeholder engagement activities appear to occur on an ad hoc basis. The importance of stakeholder engagement and of obtaining a Social License to Operate (“SLO”) should not be underestimated. Noting that stakeholder engagement during the ESIA was inadequate, it is crucial that supplementary engagement to communities and officials commences as soon as possible.

Stakeholder engagement (which is a GIIP requirement) should not be confused with Corporate Social Responsibility (CSR) programmes (which are best practice, probably essential, but not necessarily a Lenders Group Standard).

CGGC’s should also compile and implement a CSR programme for the project. In this impoverished area, communities’ demands might be impossible to satisfy and CGGC should prepare a structured and targeted CSR programme, which will also serve to decide which CSR activities CGGC will and will not support. Managing community expectations is important in this regard. According to the recent visit to the Yapepe village, the village expects a clinic, a school, and clean water supply from CGGC. CGGC advises that as part of CSR they financially support qualified Angolans (under 18) attendance as a technical school for




construction equipment operation training, and graduates could be hired by the project. Evidence is to be provided. Other CGGC CSR initiatives include donation of food and groceries to nearby villages on public holidays.

18. Develop a SEP in discussion with the community and disclose to stakeholders. Detail the nature and timing of consultation / disclosure of information to surrounding communities as well as anticipated public service (grievance) mechanism. Identify and consider particularly vulnerable groups within the local communities.

The EPC Contractor

Nov 1 2017 It is crucial that a structured regional programme of engagement is undertaken over the life of the project. The SEP should take account of all (external) stakeholders, e.g. employees, communities, regional authorities, media, etc., and present a schedule of planned key messages over time, aligned with progress on the project. Various plans will also need to be disclosed to stakeholders. A grievance mechanism for surrounding communities is required.

Two junior level GAMEK representatives has arrived at the project site recently and inspect the construction activities.

PS 2: Labour and Working Conditions

19. Develop a Recruitment Plan in compliance with IFC’s requirements.

The EPC Contractor

Nov 1 2017

CGGC has prepared an Angolan employees management policy, and a flowchart of Angola employee management, however a Recruitment Plan has not been prepared. Demobilising Lauca workers may present a recruitment opportunity.

20. Commit to applying the laws of Angola prescribing working conditions, including the principles of equal opportunity and fair treatment. Give preference to the

The EPC Contractor

Nov 1 2017, and annually

CGGC advises that they will comply with Angolan labour law, which, inter alia, respects the rights of workers to join a Trade Union. GIIP also requires compliance with International Labour Organisation (“ILO”) conventions. These ILO Conventions, including all eight Fundamental Conventions, aim to ensure that the rights of workers will be safeguarded. These include the Forced Labour Convention and the Right to Organise and Collective Bargaining Convention. However, CGGC advise that a Trade Union will not be permitted, a material non-compliance with GIIP.

SRK notes that CGGC has established a new division (the Project Localization Office) to promote the




employment of locals and do not make use of forced or child labour. If required, enter into a collective agreement with unions that sets out working conditions.

employment of the local Angolan citizens.

Accommodation conditions and food are expected to improve once permanent accommodation structures have been constructed. SRK notes that water towers with solar water heater were also installed in the temporary camp area for bathrooms and shower rooms.

CGGC reported no fatal injuries or Lost Time Injuries (“LTIs”) during the reporting period. However, no documentation pertaining to injuries was available and SRK is not able to corroborate claims that no injuries occurred: experience on other projects with similar sized workforces suggests that some LTIs would be recorded. If injures are recorded, a root cause analysis must be undertaken and corrective action implemented so as to avoid recurrence of accidents and incidents. Safety signage was prominently displayed on site and daily safety briefings are conducted. New recruits undergo a 16-hour induction programme, SRK has sight of some induction documentation. CGGC will give preference to the employment (and training) of local workers, currently comprising roughly 60% of the workforce. (By comparison, at Lauca where language is not a constraint, approximately 95% of the workforce was Angolan.).

21. Disclose and implement a grievance mechanism for workers and sub-contractors.

The EPC Contractor

Nov 1 2017 A simple grievance mechanism for employees has been implemented and CGGC advises that any complaints are directly dealt with: this lack of anonymity may have the effect of suppressing grievances in the short term. Interviews with selected employees confirms that a rudimentary grievance mechanism has been adopted. However, there is neither documentation nor statistics to facilitate investigation of trends regarding grievances (including compliments and suggestions) submitted.

22. Prepare and implement a stand-alone, project–specific Occupational, Health and Safety (“OHS”) Plan/System, which will have application during the construction and commissioning phases.

The EPC Contractor

Nov 1 2017 A Portuguese version OHS plan/system prepared by CENOR was provided to SRK as evidence of progress. This document includes elements of OHS management. SRK notes that this is a draft version, additional revision and modification is ongoing. CGGC will have to implement this system so they need to have a clear understanding of this document and its purpose, and to instruct or request CENOR to make changes as appropriate.

CGGC advise that some workers use alcohol and marijuana off site and methods to prevent further use are under investigation.

AIDS and malaria are significant health risks in Africa and comprehensive programmes to manage these risks should be prepared.

23. Provide evidence of land mine clearance certificate for the construction area on both river bank sides.

The EPC Contractor

Aug 1 2017 Only a small proportion of the land (mainly various roadway areas and the temporary camp area, with a total area of 11.2ha) has been demined and evidently unexploded ordinance was detected on site. Failure to demine (and obtain the required certificate) could lead to fatalities and constitutes a material non-compliance, which needs to be addressed immediately so that this action item can be closed-out.




PS 3: Resource Efficiency and Pollution Prevention

24. Develop a Waste Management Plan including the need for identification, classification and quantification of waste, as well as the identification of suitable methods and means of disposal. The WMP should also address waste reduction and opportunities for recycling by contractors able (and with the required permits) to recycle waste in Angola.

The EPC Contractor

Nov 1 2017 Waste is being managed in a fairly rudimentary manner. Solid waste including hazardous waste, is disposed in an unlined landfill/pit and is likely to generate uncontained leachate. Wastewater is not treated prior to discharge. SRK is also not aware of any waste recycling initiatives initiated by CGGC.

Current waste management practices will improve once new (planned) facilities are constructed. These facilities must be a located well above the appropriate (e.g 1:100) floodline. Though not considered a material risk, waste management onsite is not deemed compliant with GIIP. The (poor) quality of untreated effluent, which is directly discharged into a gully connected with the Kwanza River, is not measured nor known, but will almost certainly not be compliant with Angolan standards. CGGC advises that a waste water treatment and a landfill are under design by CENOR, and these will be built once the design is approved. The existing unlined landfill will need to be remediated and closed, to prevent long term impacts, e.g. dispersion of toxic leachate.

CGGC will need to identify licensed waste recycling facilities (mostly in Luanda) as soon as possible.

25. Preferably consolidate the storage of waste into one or a few waste storage areas. Identify areas likely to be most suitable for waste storage and ensure that the impacts of temporary waste storage or disposal on site are adequately considered in the ESIA.

The EPC Contractor

Nov 1 2017 CGGC disposes of garbage in an unlined pit on an ad hoc basis, and no waste recycling program has been initiated. CGGC advises that a landfill design by CENOR is under review, and it will be built once the design is approved. Separate sorting/storage facilities for various waste streams (plastic, wood, metal, paper) will be required to facilitate recycling.

26. If effluent from the The EPC Nov 1 2017, CGGC advises that operational discharges of effluent will comply with fairly recently promulgated Angolan




project will be disposed of /discharged into the Kwanza River, determine effluent discharge standards and implement a (simple) effluent monitoring plan.

Contractor and with ongoing monitoring

standards. SRK has evaluated these standards and confirms that they are consistent with GIIP. However the current effluent from the temporary camp does not comply since it is discharged without any treatment.

27. Update the Water Quality Monitoring Plan to incorporate baseline monitoring as well as specifying the relevant guideline levels for water quality. Baseline water quality monitoring should ideally start as soon as possible with the aim of obtaining seasonal baseline measurements against which the seasonal monitoring can be benchmarked.

The EPC Contractor

Nov 1 2017, and with ongoing monitoring

Water quality monitoring is critical to the project. This work may have to be undertaken by environmental consultants and it is probable that select local (Angolan) consultants will be equipped to do most of this work. To date, there has been only very rudimentary monitoring at a single location near the potable water treatment facility intake. Further progress and more comprehensive monitoring will need to commence very soon, also to characterise a meaningful pre-construction baseline and ensure compliance with the deadline prescribed in the ESAP.

28. Treat wastewater if necessary to ensure that wastewater discharged into the Kwanza River meets the discharge standards. The treatment methods may include, but are

The EPC Contractor

Nov 1 2017 CENOR is currently designing the wastewater treatment plant, likely to comprise a combined physical and biochemical treatment method. The design is still under discussion.

A comprehensive stormwater management plan has not been prepared, in which separation of dirty water from clean water and sedimentation ponds should be considered.




not limited to separation of dirty water from clean water, sedimentation ponds, biochemcial treatment, and chemical treatment.

29. Implement an air quality monitoring plan and take appropriate measures to protect occupational health and community health.

The EPC Contractor


CGGC advises that they are committed to compiling and implementing numerous environmental management plans and rapid progress is required on this plan so that structured monitoring can commence. Monitoring will need to be undertaken by independent consultants. Note that local (Angolan) consultants may not be equipped to undertake air quality monitoring, and CGGC may want to purchase qualified air monitoring equipment, although monitoring will have to be undertaken by independent consultants. CGGC should consider installing an incinerator (as is the case at Cambambe and Lauca) to treat certain waste streams.

30. Implement a noise monitoring plan and take appropriate measures to protect occupational health and community health.

The EPC Contractor


CGGC advises that they are committed to compiling and implementing numerous environmental management plans and rapid progress is required on this plan so that structured monitoring can commence. Monitoring will need to be undertaken by independent consultants. Note that local (Angolan) consultants may not be equipped to undertake noise monitoring, and CGGC may want to purchase qualified noise monitoring equipment, although monitoring will have to be undertaken by independent consultants.

31. Develop a Closure and Rehabilitation Plan (“CRP”) which defines the best end use for facilities, areas to be rehabilitated and includes a land disturbance area registry and rehabilitation schedule and budgets. Rehabilitation should be incremental, commencing during

The EPC Contractor


CGGC advises that they are committed to compiling and implementing numerous environmental management plans and rapid progress is required on this plan so that concurrent rehabilitation can commence, rather than delay rehabilitation until the end of construction. CGGC appointed CENOR to prepare a deforestation plan and a rehabilitation plan, both still under preparation. SRK notes that topsoil stripped during site clearance is stockpiled in a designated area for future rehabilitation use, compliant with GIIP.

Concurrent rehabilitation should commence as soon as possible and be ongoing.




the construction phase.

PS 4: Community Health, Safety and Security

32. Obtain the required independent verification of dam safety (also required by the World Bank Safeguard Policy for Dams).

The EPC Contractor

Nov 1 2018 To comply with GIIP, an independent study to review Changjiang Institute of Survey, Planning, Design and Research’s design and verify dam safety will be required. This study should be submitted to ICBC.

33. Develop an Emergency Response Plan (“ERP”) to address emergency response procedures for communities around and downstream of the dam, in the case of an emergency during construction or operation of the Caculo Cabaça Hydropower Plant. (This should include a dam break at Lauca.)

The EPC Contractor

Nov 1 2018 CGGC advise that an ERP, excluding dam failure, has been compiled. SRK was provided with a draft ERP regarding evacuation, flammable and explosive materials, electromechanical equipment accident, public security affairs, fire, road incidents, infectious diseases and food poisoning as evidence of progress. Project specific emergency information and measures are to be prepared in these documents. Where appropriate, roles and responsibilities (and contact details) of local authorities, e.g. fire brigade, hospitals etc. should be incorporated in the ERP.

ERP simulations with local authorities should be undertaken, acknowledging that their capacity is limited, but their involvement is important.

34. Disclose relevant details of the ERP to external stakeholders.

The EPC Contractor

Nov 1 2018 The ERP has not been disclosed. Local authorities may (or may not) have emergency response capacity but should be informed of and fully involved in emergency response, including ERP simulations.

35. Monitor impacts of the Project on community health and take appropriate measures

The EPC Contractor

Nov 1 2017 with ongoing monitoring

The Yapepe village with a total of approximately 40 people is located near the entrance of this project, which will be impacted by dust and noise from roadway traffic. Many other communities and villages in the region will be similarly is or otherwise affected. Regular monitoring may be required (in addition to disclosed grievance mechanisms in each community).




to mitigate any impacts, e.g. afford access to Project health care resources and facilities.

PS 5: Land Acquisition and Involuntary Resettlement

36. Survey all areas to be affected by the project footprint to identify and parties that may be physically or economically displaced.


Nov 1 2017 It is probably the case that - as reported by CGGC - no communities will be physically or economically displaced, and no homes are located in the area which will be inundated. However, this is a critical GIIP concern and it is imperative that the area to be inundated is surveyed and groundtruthed to definitively confirm whether any form of displacement or adverse consequences for livelihoods will occur or not. The Yapepe soba (chief) advised that communities frequently gather fruit near Caculo Cabaca mountain. If displacement will occur, a RAP and/or Livelihoods Restoration Plan (LRP) will be required.

37. Provide evidence of licensed diamond mining company not operating in Caculo Cabaca inundated area.


Nov 1 2017 Evidence should be provided as soon as possible.

38. Inform stakeholders of the boundaries of the inundated area and cut-off date for determining the need for economic displacement.


Nov 1 2017 The related baseline and groundtruthing survey should commence as soon as possible.

39. Develop a RAP and/or livelihoods restoration plan (LRP) in compliance with the requirements of PS5, addressing both


Nov 1 2017 The related baseline survey and groundtruthing should commence as soon as possible.




physical and economic displacement, if required.

PS 6: Biodiversity Conservation and Sustainable Management of Living Natural Resources

40. Develop a BAP aimed at monitoring aquatic and terrestrial habitats and identifying and implementing measures to reduce impacts and restore biodiversity and ecosystem services. The BAP must address protection of Red List species.

The EPC Contractor

May 1 2018 A BAP should be prepared. It is very likely that a (local) consultant will need to be appointed to compile the BAP.

Note that at Lauca and Cambambe, an Angolan parastatal body (INBAC) is co-ordinating the biodiversity offset process, which may take a number of years to implement. CGGC should liaise with INBAC to confirm the biodiversity offset process at Caculo Cabaca.

41. Conduct a more detailed assessment of provisioning ecosystem services from a livelihoods perspective and include the results and associated actions in the BAP and RAP/LRP.

The EPC Contractor

Nov 1 2017 Almost certainly this work will have to be undertaken by environmental consultants and it is probable that select local (Angolan) consultants will be equipped to do most of this work. To date, there has been very little progress in this regard and action will need to be taken very soon to ensure compliance with the deadline prescribed in the ESAP.

PS 8: Cultural Heritage

42. Commission an independent cultural heritage baseline specialist study to confirm whether there are likely to be any

The EPC Contractor

Nov 1 2017 Assessing cultural heritage impacts is a key IFC requirement. CGGC correctly notes that this should have occurred or been considered in the ESIA Report. Unfortunately it was not, and is a gap which has to be closed to ensure compliance with GIIP. Almost certainly this work will have to be undertaken by environmental consultants and it is very probable that select local (Angolan) consultants will be equipped to do most of this work. This should not be a particularly onerous or costly study.




cultural heritage resources within the Project AoI including consultation with relevant authorities and communities. Pending the outcomes of this study, develop a cultural heritage conservation plan (if necessary) with input for the specialist. Amend the ESIA and mitigation measures based on the finding of this exercise.

SRK Consulting: Std Bank Caculo Cabaça ESDD Page 54


SRK Report Distribution Record

Report No. 524233

Copy No.

Name/Title Company Copy Date Authorised by

Nigel Beck Standard Bank PDF 17 November 2017 C. Dalgliesh

Library SRK Consulting 1 17 November 2017 C. Dalgliesh

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