Environmental and Social Management Framework (ESMF)documents.worldbank.org/curated/en/... · 1 Introduction . The electric power sector in Nigeria suffered long periods of neglect

Nigeria Electricity and Gas Improvement Project (NEGIP)

Environmental and Social Management Framework (ESMF)

Prepared by

The Environment, Resettlement and Social Unit (ERSU), Project Management Unit (PMU)

Power Holding Company of Nigeria (PHCN), 7 Kampala Street,

Wuse II, Abuja, Nigeria www.nepapmu.org

August, 2008.

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Environmental and Social Management Framework (ESMF) for NEIP

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Acronyms AGIS Abuja Geographic Information System APL Adaptable Program Loan CDP Community Development Program CEO Chief Executive Officer CLO Community Liaison Officer DisCo Distribution Company DPR Department of Petroleum Resources EA Environmental Audit EIA Environmental Impact Assessment EMF Electromotive Force EMP Environmental Management Plan EPIC Electric Power Implementation Committee EPZ Export Processing Zone ERSU Environment, Resettlement and Social Unit ESMF Environmental and Social Management Framework FCDA Federal Capital Development Authority FCT Federal Capital Territory FEPA Federal Environmental Protection Agency FGN Federal Government of Nigeria FMEH Federal Ministry of Environment and Housing FMEnv Federal Ministry of the Environment GenCo Generation Company GHG Green House Gas IDA International Development Association IFC International Finance Corporation IOC International Oil Company IPC Ibom Power Company IUCN International Union for the Conservation of Nature JV Joint Venture Mmcfd million cubic feet per day MW Mega Watts MYTO Multi-Year Tariff Order NCP National Council on Privatization NEIP Nigeria Energy Infrastructure Project NEPA National Electric Power Authority NERC National Electricity Regulatory Commission NGC Nigeria Gas Company NIPP National Integrated Power Project NM Nautical Mile NNPC Nigeria National Petroleum Corporation OPN Operational Policy Note PHCN Power Holding Company of Nigeria PMU Project Management Unit PPA Power Purchase Agreement PRG Partial Risk Guarantee RAP Resettlement Action Plan ROW Right of Way RPF Resettlement Policy Framework


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RTM Regional Transmission Manager TCF Trillion Cubic Feet TCN Transmission Company of Nigeria TTL Task Team Leader WBG World Bank Group WCM Work Centre Manager WHO World Health Organization


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Table of Contents ACRONYMS ...............................................................................................................................................................3

TABLE OF CONTENTS............................................................................................................................................5

EXECUTIVE SUMMARY .........................................................................................................................................6

1 INTRODUCTION .............................................................................................................................................7

2 DESCRIPTION OF THE ENVIRONMENT ..................................................................................................9

2.1 BIO-PHYSICAL ENVIRONMENT....................................................................................................................9 2.2 VEGETATION.............................................................................................................................................10 2.3 POLITICAL GEOGRAPHY AND POPULATION...............................................................................................10 2.4 NATURAL RESOURCES AND LAND USE.....................................................................................................11

3 WORLD BANK SAFEGUARD POLICIES..................................................................................................14

3.1 OP/BP 4.01: ENVIRONMENTAL ASSESSMENT...........................................................................................14 3.2 OP/BP 4.04: NATURAL HABITAT ..............................................................................................................15 3.3 OP/BP 4.11: PHYSICAL CULTURAL RESOURCES.......................................................................................15 3.4 OP/BP 4.12: INVOLUNTARY RESETTLEMENT...........................................................................................16 3.5 SECTOR GUIDELINES FOR ELECTRICAL POWER GENERATION AND TRANSMISSION...................................16 3.6 POLLUTION STANDARDS...........................................................................................................................17

4 NIGERIA REGULATORY FRAMEWORK................................................................................................19

4.1 ENVIRONMENTAL IMPACT ASSESSMENT ACT (DECREE 86) OF 1992 ........................................................19 4.2 POLLUTION STANDARDS...........................................................................................................................20 4.3 LAND USE ACT OF 1978 (AMENDED IN 1990)............................................................................................23 4.4 INTERNATIONAL CONVENTIONS AND TREATIES RATIFIED BY NIGERIA ............................................23

5 DESCRIPTION OF THE ENERGY SECTOR ............................................................................................24

5.1 REFORMS IN THE ENERGY SECTOR............................................................................................................24 5.2 SECTOR INSTITUTIONS..............................................................................................................................24

6 PROJECT DESCRIPTION ............................................................................................................................27

6.1 PROJECT CONCEPT....................................................................................................................................27 6.2 PROJECT COMPONENTS AND INTERVENTION PLAN ...................................................................................27

7 SAFEGUARDS PREPARATION, REVIEW AND APPROVAL PROCESS ...........................................29

8 POTENTIAL IMPACTS OF NEIP................................................................................................................35

8.1 IMPACTS OF THE NEIP ON THE NIGER DELTA ........................................................................................35

9 INSTITUTIONAL CAPACITY FOR ENVIRONMENTAL MANAGEMENT........................................46

9.1 ERSU SKILLS AND GAPS..........................................................................................................................46 9.2 PHCN .......................................................................................................................................................46 9.3 FMENV .....................................................................................................................................................47 9.4 RELATIONSHIP BETWEEN THE FEDERAL GOVERNMENT AND STATES........................................................48

ANNEX 1. SUMMARY OF CONSULTATIONS..............................................................................................50

(ANNEX) 1.1 NGO STAKEHOLDERS WORKSHOP, WB OFFICE, ABUJA, MAY 2, 2008 ......................................50 (ANNEX) 1.2 IBOM COMMUNITY DEVELOPMENT PROGRAM............................................................................57

ANNEX 2. COST BREAKDOWN FOR ERSU IN THE NEIP ........................................................................59

ANNEX 3. SAFEGUARDS TABLES .................................................................................................................60

ANNEX 4. CONTENTS OF AN EIA..................................................................................................................63

ANNEX 5. GUIDELINES FOR THE PREPARATION OF EMP...................................................................65


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Executive Summary This Environmental and Social Management Framework (ESMF) is an assessment tool for the proposed Nigeria Energy Infrastructure Project (NEIP). The NEIP by environmental screening is a category ‘A’ project requiring a full EIA according to World Bank and Government standards.1 The likely impacts of this project are large scale, covering a wide area, and affecting a large population and diverse habitats and ecosystems. NEIP is an Adaptable Program Loan (APL) aimed at assisting the Federal Government of Nigeria, through a combination of partial risk guarantees (PRG), International Development Association (IDA) investment and technical assistance, in improving and developing the Nigerian power sector. It follows a programmatic approach, and will consist of numerous investments and guarantees over an extended time period, some of which will be determined long after project initiation. This ESMF therefore sets a framework aimed at assisting the proponents in carrying out detailed environmental and social assessments for each of the new subprojects as it is proposed for investment, and it will direct the subproject sponsors in steps to be taken in making sure the project is environmentally sustainable. For work at existing power stations that may be included in this project, an environmental audit (EA) will be conducted as a first step in the implementation process to determine the physical state of the facilities, the viability of investing in their rehabilitation from an environmental management perspective, and the potential environmental and social impacts associated with the rehabilitation project. Minimum requirements for an EA in the power sector are presented in �Annex 4.

A Resettlement Policy Framework (RPF) has been prepared and is disclosed as a separate document. Following the procedures set out in the RPF, a Resettlement Action Plan (RAP) will be prepared by each subproject sponsor using the template as specified in the NEIP RPF if relocation or loss of assets or means of livelihood will be involved. The Bank policies on environmental assessment, natural habitats, physical and or cultural resources, and involuntary resettlement have been triggered. NEIP has the following potential impacts: loss of vegetation/habitat, fragmentation of habitat, chemical contamination of soil, water, air, and noise pollution during construction, liquid and solid wastes management, as well as potential impacts on local populations (loss of crops, fishing and hunting resources) and cultural assets (e.g. burial sites, places of worship) etc. The Environment, Resettlement & Social Unit (ERSU) of PMU possesses demonstrated capacity to prepare and put into effect the EMPs and RAPs required for the successful implementation of NEIP investments in power generation, transmission and distribution. The more technical aspects of EIA preparation and environmental audit for these types of investments and for rehabilitation of existing generating plants will be outsourced. Private sector sponsors of investments in generation will be responsible for their own EIA preparation and implementation. The ERSU will serve as the utility’s reviewer and monitor of EIA implementation by private sponsors and needs to be trained and equipped to make up for gaps in capacity to carry out these functions.

1 The screening criteria for the World Bank and The Federal Government of Nigeria for projects of this category are similar.


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1 Introduction The electric power sector in Nigeria suffered long periods of neglect with decades of virtually no investment during the military regimes. This led to the decay of electricity infrastructure, loss of assets of the sole government electric utility and a general lack of capacity to meet the electricity demands within the country. With the advent of democracy in 1999, the Federal Government of Nigeria took certain steps to restore the electric power sector by investing in the rehabilitation of the transmission and distribution infrastructure while carrying out studies on the best ways to improve generation capacity. The government also embarked on the reform of the sector by passing the Electric Power Sector Reform Act into law in 2005. This Act was aimed at unbundling the National Electric Power Authority (NEPA) into eighteen Business Units that will eventually with time, become privately owned companies. These efforts were aimed at bridging the gap between electric power demand and power generated by the government utility. This gap 2008 is in the region of 8,700 MW and is mainly due to (i) lack of adequate generating units to put energy on the national grid and (ii) lack of gas to fire the available plants. A number of existing power plants are out of service for reasons ranging from lack of maintenance to lack of spares. The Nigeria Gas Company (NGC) is also not able to supply enough gas to the thermal plants to ensure the running of all available units. Although Nigeria has vast reserves of gas, much of this is flared. As part of its strategy, the Federal Government of Nigeria (FGN) has asked the Bank to support a Nigeria Energy Infrastructure Program (NEIP) that will promote private-sector development of gas-fired power generation, finance the rehabilitation of existing thermal generating stations to increase their energy production, and finance new transmission and distribution capacity to deliver the additional power to the national grid and to regional customers. The program will be in two phases. Since the specific subprojects are not known with certainty during this time the project is being prepared for presentation to the Bank’s Board of Executive Directors, Bank environmental assessment policy requires the borrower to prepare an Environmental and Social Management. Framework (ESMF) that is to establish a mechanism for assessment of the environmental and social impacts of all program subprojects, and to set out in general the mitigation, monitoring and institutional measures to be taken during implementation and operation of the program to eliminate adverse environmental and social impacts, offset them, or reduce them to acceptable levels. This ESMF therefore provides the expected guidelines and defines the procedures whereby environmental impact assessments (EIAs) and eventually environmental management plans (EMPs) will be prepared and implemented for each subproject of the NEIP as may be required. This document is in compliance with Bank safeguards policies and the relevant Nigerian environmental policies, laws, and regulations. Furthermore, the borrower has also prepared a Resettlement Policy Framework (RPF) to address the needs of those who might be affected when a subproject supported by NEIP causes the involuntary taking of land and other assets resulting in: (a) relocation or loss of shelter, (b) loss of assets or access to assets (c) loss of income sources or means of livelihoods, whether or not the affected person must move to another location. The RPF has been prepared as a separate, stand-alone document. The borrower is further required to disclose both documents (the ESMF and the RPF) in-country as two separate draft documents so that they are accessible by the general public, local communities, potential project-affected groups, local NGOs and all other stakeholders. They


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will also be disclosed by the Bank at its InfoShop in Washington and in the Public Information Center of its field office in Abuja. The date for the disclosure of these documents will precede the date for appraisal of the investment program. Stakeholders must be consulted during preparation of the ESMF and RPF and must be given ample opportunity to review and comment on the drafts. The final versions of both documents will be disclosed at the same locations and will include summaries of the consultations, the comments and suggestions received, and their disposition.


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2 Description of the Nigerian Environment

2.1 Bio-Physical Environment The Federal Republic of Nigeria is located on the west coast of Africa and is bounded on the west by Benin Republic (with a boundary of about 773 km), on the north by Niger (with a boundary of 1,497 km), on the east by Chad and Cameroon (with a combined boundary of 1,777 km) and on the south by the Gulf of Guinea (853 km of coastline). It has a continental shelf of 200 m depth, an exclusive economic zone of 200 nautical miles (NM) and a territorial sea of 12 NM. Nigeria lies around latitude 10o00’N and Longitude 8o00’E and has a total area of 923,768 km2.

It consists of four major natural zones: a 60-km wide coastal band in the south indented by lagoons and by the immense Niger River Delta; a stretch of high forest-covered mountains (Shebshi Mountains) rising to heights of about 2,042 m above sea level in the west; the Jos Plateau (1,200 m) in the centre; the Highlands along the eastern border, south of the Benue River; and the plain of Sokoto and the Lake Chad Basin in the north, which forms part of the Sahel region, and is semi desert. The highest point in Nigeria is Chappal Waddi at 2,419 m (7,936 feet). The River Niger traverses the country from the northwest, meets the River Benue at Lokoja in the central part of the country before draining into the Atlantic in a deltaic fashion. Nigeria is divided into three main climatic regions: the tropical rain forest region covering the southern part of the country with an annual rainfall of around 2,000 mm (80 inches), the near desert region covering the far north of the country with an annual rainfall around 500 mm (20 inches) and the savannah region with annual rains around 1,000 mm (40 inches) and covering the central portion of the country. Niger DeltaThe Niger Delta is one of the largest deltas in the world. Located in southeastern Nigeria, it covers over 20,000 square kilometers. The Niger Delta receives inputs from a total catchment area of 2.23 million km2 and has the fourth largest average annual discharge in Africa: 180 billion m3. Within the Delta floodplain, the river splits into six major tidal channels and innumerable smaller outlets. Fluvial sediments are deposited throughout the Delta with sand and silt suspension during both high and low flood regimes. Construction of dams along the Niger during the last twenty-five years has significantly modified flow regimes and sediment deposition. Tidal currents, which range up to 1.5 m/sec, determine sediment settling patterns near the coast. The mean monthly temperature is 27°C and humidity remains constant around 80%. The Delta can be roughly categorized into four ecological zones: coastal barrier islands, mangroves, freshwater swamp forests, and lowland rainforests. The hydrological boundaries between ecological zones are fluid and depend on seasonal river flows. Over 80% of the Delta is seasonally flooded, including all the swamp forest, except the riverbank levees. During most years, only select elevated areas remain dry. The flooding causes severe and extensive riverbank erosion. When the flood waters recede, the channels that spread out across the delta leave swamps and pools that drain only poorly, if at all. Through erosion, water accumulation, and sediment deposition, the Niger Delta is constantly reshaped by flooding. However, since the construction of the Kainji Dam on the Niger River in the late 1960s, peak discharge volumes have declined by approximately 30%, disrupting the hydrological balance.


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2.2 Vegetation The vegetation of Nigeria is of four main types: Savannah, Forest and Montane. The savannah vegetation stretches from the central parts of Nigeria to the extreme northern parts. It is divided into marginal – Sahel – (in the northeastern borders), short grass – Sudan – savannah (stretching from upper western borders to the northwestern borders) and woodland and tall grass – Guinea – savannah (lying below the short grass savannah and covering the central states and parts of the eastern region of the country). The tropical forest vegetation covers the remaining southern portion of the country and is divided into three types: rain forest (with tall trees), fresh water swamp (consisting of both fresh and salt water swamps) and mangrove forest (made up of mangrove vegetation).

2.3 Political Geography and Population The Federal Republic of Nigeria is made up of thirty-six states with a federal capital territory of Abuja. Each state is ruled by an elected governor and is assisted by a deputy. It is subdivided into local government areas, each headed by an elected Local Government Chairman. The country as a whole is ruled by a democratically elected President and assisted by a Vice President. The 2006 national population census put the population of Nigeria at 140 million, the most populous in Africa. Of this number, 68.3 m are women, while 71.7 m are men. The population growth rate is 2.4%. In general, Nigeria has a young population with a median age of 18.7 years. Nigeria has more than 250 ethnic groups, with varying languages and customs, creating a country of rich ethnic diversity. The largest ethnic groups are the Fulani/Hausa, Yoruba, and Igbo, accounting for 68% of population, while the Edo, Ijaw (10%), Kanuri, Ibibio, Ebira Nupe and Tiv comprise 27%; other minorities make up the remaining 7%. Despite its vast government revenue from the mining of petroleum, Nigeria is beset by a number of societal problems. Some of these problems are listed below. There is evidence that the key health indicators have either stagnated or declined. Life expectancy is 48.5 years for females and 47.2 years for males. The infant mortality rate is 94 per 1,000 live births. About 52% of under-five deaths are associated with malnutrition. The maternal mortality rate of 800 per 100,000 live births is one of the highest in the world.

Disease prevalence rates include malaria, 919/100,000; dysentery, 386/100,000; pneumonia, 146/100,000; and measles, 89/100,000. The national median prevalence rate of HIV is 5.8%. Over 40 million Nigerians are exposed to Onchocerciasis; and about 120,000 have gone blind from the disease. Schistosomiasis is prevalent in rural areas which lack potable water, and control of the infection has been limited by the high cost of the drug of choice. Due to its multitude of diverse, sometimes competing ethno-linguistic groups, Nigeria has seen sectarian tensions and violence. There are significant tensions on a national scale, especially between the primarily Muslim, highly conservative northern population and the Christian population from the Southern part of the country. Violence between Muslims and Christians occurred until 2004, when the Federal Government introduced tough new measures against religious violence. Politics of the Niger DeltaThere is tension and conflict in the oil-producing Niger Delta region, where both state and civilian forces employ varying methods of coercion in attempts to gain control over petroleum


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resources. Conflict manifests itself as intra-community (between the leaders and the people) and inter-community (between different communities or ethnic groups). Despite its vast oil reserves, the Delta region remains poor. GNP per capita is below the national average of US$280. Unemployment in Port Harcourt, the capital of Rivers State, is 30% and is believed to be equally high in the rural areas of the Delta. The rural population commonly fish or practice subsistence agriculture, and supplement their diet and income with a wide variety of forest products. Education levels are below the national average and are particularly low for women. While 76% of Nigerian children attend primary school, this level drops to 30-40% in some parts of the Niger Delta. In terms of overall poverty levels, available data show that poverty incidence declined between 1996 and 2004 across the Delta. Further, current poverty levels in the Delta are not the highest in Nigeria. However, poverty incidence figures alone do not explain why inhabitants of the region feel so disaffected. The volatility of the region is also because of the perceived sense of injustice driven by the depth of poverty, levels of inequality, and subjective assessments of poverty. This sense of injustice also has a subjective dimension which is influenced by perceptions not only about one’s current welfare, but also about the relative prosperity of others, and one’s own sense of entitlement. The widespread perception of relative deprivation in the Niger Delta is driven by the considerable mismatch between the high level of wealth extracted from the region and the low level of benefits accruing to the region and its people.

2.4 Natural Resources and Land Use

2.4.1 Agricultural Resources

Nigeria has abundant human and natural resources. Agriculture used to be the mainstay of the economy before the discovery of crude oil. Cocoa, rubber and kola nut are cultivated in the southwestern region in commercial quantities for export. Oil palm is cultivated in the southeastern parts of the country, and processed into palm oil and packaged for export. The northern parts of the country were known for groundnut and cotton production. With the production of crude oil, however, and the onset of, much agricultural production has declined.

2.4.2 Biodiversity

Nigeria is an important centre for biodiversity. It is widely believed that the areas surrounding Calabar in Cross River State contain the world's largest diversity of butterflies. The drill monkey is only found in the wild in Southeast Nigeria and neighboring Cameroon. The total number of higher plant species in Nigeria is 4,715 (of which 119 are threatened). For mammals, the total number of species is 274 (27 threatened), and for breeding birds the total known species is 286 (9 threatened). Nigeria has over 1,000 protected areas (nature reserves, wilderness areas, national parks), covering a total 5.5 million ha. The total land area under protection represents 6% of the total land area. Under categories I and II (the highest level of protection) Nigeria has 2.5 million ha. Niger DeltaThe biodiversity significance of the Niger Delta is high from regional and global perspectives. According to the International Union for the Conservation of Nature (IUCN), the Niger Delta is


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one of the highest conservation priorities on the west coast of Africa. It holds a large number of threatened and endangered species, particularly mammals, that are economically, aesthetically, and scientifically very valuable. For example, the only mammal known to be endemic to Nigeria, Sclater’s guenon, is found in the delta. The high value of the biodiversity in the region is being rapidly eroded by hunting, uncontrolled logging, agricultural encroachment and poorly designed development projects. The State Forestry Departments are completely unable to address these threats in protected areas, let alone other biologically rich areas. The benefit of preserving biodiversity in the region is rated as high because of its rich biological resources and the rising international willingness to pay for biodiversity.

2.4.3 Mineral Resources

There are varieties of mineral resources found throughout the country; some are of great economic significance, while others are in small quantities. Most of these minerals occur near the soil surface and do not require specialized equipment for extraction. The schist belt of the country stretches from the northwest to the southwest, and hosts the gold deposits of the country. The occurrence is moderate, but is mined by locals for commercial benefits. Typical sites are in Ilesha in Ekiti State. The north-central part of Nigeria is home to precious stones like amethyst, garnet, tourmaline, aquamarine, and emerald. These gemstones are mostly found in Nasarawa and Plateau States and are mined in commercial quantities for export. Jos, in Plateau State, used to export tin worldwide, but large-scale commercial mining of this metal is no longer in progress. Nigeria has an abundant deposit of limestone, found mainly along the Benue trough with significant deposits in Gombe and Enugu states. These two states have cement factories to serve both local and international markets. There are also occurrences of gypsum in Gombe State.

2.4.4 Energy Resources

2.4.4.1 Oil and Gas

Nigeria’s oil reserves are located in the Niger Delta (both onshore and offshore) and are managed by the Nigerian National Petroleum Corporation (NNPC) in collaboration with several private oil firms. The NNPC for now is a government corporation but there are possibilities of a Reform soon. There are studies on the possibility of finding oil in the upper parts of the trough of the Benue River, but these have not been successful. Petroleum plays a large role in the Nigerian economy, accounting for 40% of the GDP, 95% of foreign exchange earnings, and 80% of budgetary revenues. Nigeria is the 12th largest producer of petroleum in the world and the 8th largest exporter, and has the 10th largest proven reserves. However, owing to crumbling infrastructure, corruption, and ongoing civil strife in the Niger Delta, oil production and export is not at 100% capacity. Proven reserves of petroleum stand at 17.9 billion barrels, sufficient for 24 more years of production at current levels (around 2 million barrels per day - or 3% of world production). Proven reserves of natural gas amount to 182 tcf (approximately 1,000 times the volume of oil reserves). In 1989, Nigeria produced 2,267 mmcfd of natural gas, of which 1,690, or 75%, was flared into the atmosphere. Some of the gas is fed back into the local market to fire gas power plants and for both industrial and domestic use. The Nigeria Gas Company (NGC), a subsidiary of the NNPC, is responsible for marketing gas in the local market. The Federal Government has


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given a deadline of December 2008 to the oil companies to stop flaring. This is expected to increase the availability of gas for power generation within the country.

2.4.4.2 Electric Power

There are two main sources of electric power in Nigeria; hydroelectric and thermal. The hydroelectric power stations are located in the north-central part of the country on the River Niger at Shiroro, Kainji and Jebba and have installed capacities of 600 MW, 720 MW and 540 MW respectively. These hydroelectric plants generate below their installed capacities producing an average of 111 MW, 283 MW and 225 MW respectively. There are prospects of other hydroelectric power sources Makurdi, Katsina-Allah, Zungeru and in the Mambila Plateau, Adamawa State. Other mini hydroelectric plants are being constructed to serve small communities off the national grid in a few places around the country. Eight thermal power plants presently serve the country. Five of these (Egbin – steam, Sapele – steam, Afam – gas, Delta – gas, and Geregu – gas) belong to the Power Holding Company of Nigeria (PHCN) while three (AES – gas, Opkai – gas/steam and ASCO – gas) are owned by private investors. Egbin, Sapele, Afam, Delta and Geregu have installed capacities of 1320 MW, 720 MW, 921 MW, 900 MW and 414 MW respectively, but actually generate about 880 MW, 240 MW, 75 MW, 320 MW and 83 MW respectively, or approximately 60% of capacity. The privately owned thermal plants (Opkai and AES) have installed capacities of 480 MW and 226MW respectively but actually generate about 272 MW and 225 MW respectively, or 78% of capacity. The ASCO plant is out of service due to a fire outbreak. The total installed capacity for power generation in Nigeria is 3,375.5 MW but the peak generated power as of May 2008 is 2,273.3 MW. This gap is primarily due to lack of gas, but also to the fact that some of the generating units are out of service. Comparing the actual generated power to the estimated load demand of about 10,700 MW gives a shortfall of 8,427 MW. The effect of this is frequent and prolonged blackouts, forcing commercial and domestic electricity consumers to resort to the use of generators. There are several power generation projects going on in the country as part of efforts by the government to meet the demand for energy. Most of these projects are gas based plants, which will increase demand for gas. This partly explains why the Federal Government has to enforce the ban on gas flaring by December 2008. There are abundant coal reserves in Enugu, Okaba and Gombe. The National Electricity Regulatory Commission (NERC) recently awarded licenses to some private firms to establish coal-fired power plants in Enugu. When these plants come on stream they will add to the total available power in the country and improve power supply. Studies are presently ongoing to establish the viability of running coal-fired power plants in other parts of the country where coal is found in commercial quantities.


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3 World Bank Safeguard Policies The World Bank has given increasing attention to the assessment of environmental impact of investment projects and requires environmental assessments for all projects it is to finance. Its ten safeguards policies, aimed at preventing and mitigating undue harm to people and their environment in the development process, also provide a platform for the participation of stakeholders in project design and implementation. The ten safeguard policies are:

1. Environmental Assessment (OP/BP 4.01) 2. Forests (OP/BP 4.36) 3. Involuntary Resettlement (OP/BP 4.12) 4. Indigenous Peoples (OP/BP 4.10) 5. Safety of Dams (OP/BP 4.37) 6. Pest Management (OP 4.09) 7. Physical Cultural Resources (OP/BP 4.11) 8. Natural Habitats (OP/BP 4.04) 9. Projects in Disputed Areas (OP/BP 7.60) 10. Projects on International Waterways (OP 7.50)

In this project, only four safeguard policies mentioned below are expected to be triggered, through the development or rehabilitation of gas-fired generating plants, electric power transmission and distribution infrastructure - the impacts of which can be significant. Others may be moderately triggered. Transmission line construction involves land clearing, with possible soil erosion and loss of habitat. Open-cycle gas-turbine generating plants also entail land clearing, produce various types of wastes, and emit air pollutants and noise.2 Rehabilitation of existing power plants may entail remedial work to correct health, safety, and environmental deficiencies. To the extent that gas is sourced from oil fields where it would otherwise be flared, there will be positive impacts on local air quality and global Green House Gas (GHG) production. Natural habitats, such as wetlands in the Niger Delta and forest, may be impacted by power plants, transmission and distribution lines, substations and gas delivery lines. Habitats of rare and endangered species could be affected. Physical and cultural resources such as small temples, burial grounds, and places of worship are among the resources that could be affected, particularly by Right of Way (ROW) clearing for transmission lines. Land acquisition will be required for power plants and ROWs for electricity and gas lines. Resettlement of people will be minimized as much as possible, but some may be unavoidable. Crops and trees of economic value may also be destroyed. Each subproject will address these issues in their own RAPs.

3.1 OP/BP 4.01: Environmental Assessment The NEIP is rated a category ‘A’ project applying the Bank screening procedures as a project that is “likely to have significant adverse environmental impacts that are sensitive, diverse, or unprecedented.” A large number of people, habitats and ecosystems are expected to be affected by the implementation of this project. The Bank operational policy on environmental assessment provides that a full EIA be conducted for category ‘A’ projects. However, now that the specific

2 Combined cycle plants often employ once-through cooling and thereby have additional impacts caused by water intake and discharge of heated water. None of the private power projects currently under consideration is a combined cycle plant, but should any be supported by NEIP, these impacts would also need to be addressed.


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investments or subprojects are not known as at this time of investment appraisal, the OP/BP 4.01 requirement is met through the preparation of this ESMF. It ESMF sets out the applicable environmental management policies and regulations of the Federal Government of Nigeria (FGN) and the World Bank Group (WBG) and defines how they will be applied in the preparation and implementation of the individual subprojects EMP. Typically the first step is screening to determine what level of environmental assessment and thus what type of instrument is appropriate. For NEIP, there are four possibilities: a full Environmental Impact Assessment (EIA) for subprojects with significant potential adverse impacts and therefore screened as Category A (WBG) or Category I (FGN); a site-specific Environmental Management Plan (EMP) for subprojects in Category B or II, with more limited potential impacts but still requiring some environmental or social impact studies; a generic EMP for subprojects with impacts that do not vary from site to site and are managed through standard practice no matter where they are located; and an Environmental Audit for subprojects involving rehabilitation of existing facilities where there may be significant environmental, social, health or safety conditions that need to be addressed. Impact monitoring plans will be integral parts of the EIAs, EMPs, and Audits.

3.2 OP/BP 4.04: Natural Habitat The Bank, through this policy, supports the protection, maintenance and rehabilitation of natural habitats. This policy requires that precautions be taken in the implementation of Bank-financed projects to ensure opportunities for sustainable development in the management of natural resources. It prohibits the WBG from supporting projects that will result in significant conversion or degradation of critical natural habitats (see OP 4.04 for the definition). It encourages positioning of projects on lands already converted and, when a project will involve significant conversion of natural habitat, requires studies to show that there are no realistic alternatives and that the benefits of positioning the project in such a location outweighs the cost of the impact on the environment. When natural habitat is converted, it is the policy of the Bank that the borrower establishes and maintains an ecologically similar protected area as an effort to offset the habitat loss. OP/BP 4.04 is relevant to NEIP particularly because it likely involves the positioning of projects in the coastal region of Nigeria. This region is characterized by the swamp forest, mangrove forest and coastal vegetation associated with typical rain forest. This area is endowed with a complex combination of rainwater forest and different species of mangrove trees. Impacts on natural habitat are addressed in the course of EIA preparation under OP/BP 4.01.

3.3 OP/BP 4.11: Physical Cultural Resources This policy deals with physical properties that are either movable or immovable objects that have some significant and broad cultural importance (locally, provincially, nationally, or internationally). Examples of cultural resources include archaeological sites, historic sites, burial grounds, temples and other religious buildings, and sacred groves. The degree of impact on cultural property is usually determined using environmental assessments (BP/OP 4.01). Where there is significant potential impact, the borrower is expected to develop a Physical Cultural Resources Management Plan consistent with the country’s overall policy framework and national legislation with due regards to institutional capabilities on physical cultural resources. Adequate consultation with the various affected groups, government authorities and NGOs must be made in assessing the potential impacts and proffering the relevant mitigation measures. The NEIP in the course of acquiring lands for the various sub-projects is likely to impact on physical cultural property, mainly shrines for traditional worship. These shrines are usually


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movable on fulfillment of certain conditions depending on the culture of the local inhabitants and determined in consultation with them. The modality for relocation or demolition must be clearly spelled out in the physical cultural resources management plan. A procedure that conforms to Nigerian law and OP 4.11 for proper handling of “chance finds” during the course of land clearing and construction needs to be established and made known to contractors and construction supervisors.

3.4 OP/BP 4.12: Involuntary Resettlement The Bank policy on involuntary resettlement takes care of situations where people will lose property, means of livelihood or experience a change in their standard of living as a result of the implementation of a Bank financed project. This policy provides the guidance for the mode and schedule for payment of all compensations, and recommends that due consultations be made with all stake holders of the project before, during and after project implementation with special attention to disadvantaged groups (women, children and the disabled) within the population. The NEIP requires the acquisition of large portions of land for construction of power plants, transmission lines and maintenance of corridors for various categories of power lines. It is anticipated that large portions of agricultural land and other assets will be affected by this project. Since the specific subproject locations and land acquisition needs are not known, the framework approach is also used to establish the procedures for compliance with OP/BP 4.12. The Resettlement Policy Framework (RPF) for this project has been prepared and is disclosed as a separate document.

3.5 Sector Guidelines for Electrical Power Generation and Transmission The World Bank Environmental Assessment Sourcebook Vol. III describes various considerations in the positioning of generating stations, ranging from economic to technical e.g. nearness to source of raw materials and to end users. In recent times reasons for positioning generating stations have included environmental and social considerations. The document also lists some criteria and procedures for screening sites for selection. The major screening tools include government policies and EA reports. Electric transmission lines are considered to be of high impact due to the need to maintain a minimum corridor for the facility, and construction of towers (risks associated with electromotive force - EMF). The degree of impact depends on the capacity, location and length of the line. Some common risks include:

o Loss of habitat due to clearing of vegetation for the ROW o Loss of assets and means of livelihood o Electrocution due to nearness of power line to human activity o Exposure of topsoil to erosion due to clearing of vegetation and excavation for

tower foundations o Exposure of protected areas to invasive plant species due to creation of ROW o Fragmentation of habitat

The mitigation measures for these risks are stated in Section 7 of this document and will form part of the EMP to be implemented by the borrower.


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3.6 Pollution Standards The International Finance Corporation (IFC) issued its new Environmental, Health and Safety Guidelines in 2007. They provide the minimum pollution and emission levels acceptable to the Bank and supersede most sections of the World Bank’s Pollution Prevention and Abatement Handbook (1998). The World Health Organization (WHO), to which the International Finance Corporation (IFC) subscribes, in its general Environment, Health and Safety guidelines, provide the following standards:

Ambient Air Quality Guidelines

IFC is in the process of revising its sectoral guidelines for thermal power plants. In the meantime, the thermal plant effluent and emission standards specified in the Pollution Prevention and Abatement Handbook still apply.


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Noise Exposure (FEPA Limit) Duration of Exposure per day (hours) Permissible exposure limit (dBA)

8 906 924 953 972 100

1.5 102 1 105

0.5 110 0.25 or less 115

Note: exposure in impulsive or impact noise should not exceed 140 dBA peak sound pressure level


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4 Nigeria Regulatory Framework Several laws and regulations apply to the oil and gas industry and energy sector in Nigeria. These include local laws as well as international treaties, acts and conventions. In this section, an overview of the laws that relate to the NEIP is given.

4.1 Environmental Impact Assessment Act (Decree 86) of 1992 The Environmental Impact Assessment Act was established in 1992 as Decree 86. This decree requires that all projects be screened using the procedure stated in the Act to determine the kind of assessment to be carried out for the project. Under the ESMF, the Nigerian screening procedure will be applied to each individual subproject that is proposed for a guarantee or financing under the NEIP, in a manner acceptable to the Bank. The screening procedure outlined by the Federal Environmental Protection Agency (FEPA) in 1995 categorizes projects as follows: o Category I - Projects in this category have wide scale, significant impacts and require full

EIAs o Category II - The projects in this category require only a partial environmental

assessment with focus on mitigation measures. The impacts are restricted to the project area.

o Category III - The Federal Ministry of Environment prepares the environmental Impact Statement because the project impacts mainly positively on the environment.

This Act addresses issues highlighted in the Bank’s policies especially as they concern protected areas, endangered species, international waters, areas under dispute, areas of historic/archaeological importance, cultural property, and forest areas (especially mangrove forests and rainforests). Examples of projects under the various categories are: Category I - Power plants of more than 10 MW, nuclear generation, combined thermal cycle plants, hydroelectric power plants, and large scale transmission lines. Also included in this category are projects in sensitive areas such as: coral reefs, mangrove swamps, small islands, tropical rain forests, areas with erosion prone soils, mountain slopes, semi arid zones, wetlands of national and international significance, natural conservation areas, areas which harbor protected and endangered species, areas of unique scenery, areas of particular scientific importance, areas of historic or archaeological interest, areas of importance to threatened ethnic groups. Category II - Small scale transmission lines, mini hydroelectric power plants, renewable energy development projects, telecom facilities, road rehabilitation, any form of quarrying or mining Category III - recreation parks and gardens, institutional development, health programs, environmental awareness, family health programs. Most of the subprojects under NEIP will fall into Category I or Category II. The Federal Ministry of Environment is responsible for final reviews of all Environmental Impact Assessment reports. This is done by the Environmental Impact Assessment Division. All EIA reports are displayed at selected locations and at the project site to enable stakeholders to


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comment and make input. Due consultation with the stakeholders is done while the EIA is being reviewed. This division is also responsible for setting environmental standards and monitoring on behalf of government to ensure compliance.

4.2 Pollution Standards The Federal Government has a number of legislations and guidelines to control pollution. Some of these are: S.I.8 National Environmental protection (Effluent Limitation) Regulations, 1991 - standards for industrial discharge into public air or waters S.I.9 National Environmental Protection (Pollution Abatement in Industries and Facilities Generating Wastes) Regulations, 1991: provides numerical Industries and effluent and emission quality (except noise). Guidelines and Standards for Environmental Pollution Control in Nigeria, 1991: - Ambient noise standards. Local regulations for the oil and gas industries are under the jurisdiction of three government agencies: the Federal Ministry of the Environment (FMEnv), the Department of Petroleum Resources (DPR), and State Environmental Laws. The FMEnv and DPR regulations applicable to NEIP are discussed here.


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Nigerian Regulatory Standards

Air QualityParticulates(ug/m3)

Black smoke(ug/m3)

CO (mg/m3) NOx (ug/m3) SOx (ug/m3) Lead (ug/m3) Hydrocarbons (ug/m3)

1 hour: 600

Daily: 250

Annual mean:40 – 60

1-hr mean: 30

8-hr mean: 22.8

Daily average:11.4

NO2

1-hr mean: 4008-hr mean: 150

NOxDaily average: 75 –113 (or 0.04 - 0.06ppm)

1-hr mean: 350

Daily average: 260 (or 0.1ppm)

Annual mean: 40-60.

Annual average:0.5 - 1

Non-methane hydrocarbon / Totalhydrocarbon / Volatile OrganicCompounds

Daily average: 160 (or 0.06 ppm)

DPR Standards – Air QualityCopper Cadmium Nickel Manganese Arsenic Mercury benzene Petroche

micals20 mg/m3 (fromstationarysource)

40 mg/m3 (fromstationarysource)

20 mg/m3 (fromstationary source)

20 kg/hr (fromstationary source)

20 – 100 mg/m3 (fromstationary source)

1 - 230 mg/m3

(from stationarysource)

24 kg/hr (fromstationary source)

1,500ug/m3


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Water QualitypH Temp

(deg C)DO (mg/l) BOD (mg/l) Total

SuspendedSolids (mg/l)

Hydrocarbon(mg/l)

Sulfate(mg/l)

Iron (mg/l) Copper(mg/l)

Cadmium(mg/l)

Nickel (ug/l)

6.5 - 8.5(treatedwaste-water)

40(treatedwaste-water)

5 mg/l(treatedwaste-water), 4-5(sanitarywastewater)

10 mg/l (treatedwaste-water),

30 (sanitarywastewater,nearshore),

45 (sanitarywastewater,offshore)

30 (treatedwaste-water)

45 (sanitarywastewater,nearshore).

Offshore - nolimit.

20 mg/l oilandgrease ineffluent

500 20(dischargeto surfacewater)

<1(dischargeto surfacewater)

0.01 mg/l <1(discharge tosurfacewater)

Water Quality (cont’d)Manganese(mg/l)

Nitrate(mg/l)

Phosphate(mg/l)

Zinc(mg/l)

Chromium (ug/l)

TotalHydrocarbon(mg/l)

Oil andGrease (mg/l)

Total DissolvedSolids (TDS)(mg/l)

Arsenic(mg/l)

Mercury(mg/l)

Benzene(mg/l)

5 (dischargeto surfacewater)

20 5 1 30 ug/l(FMEH)

10 mg/l(treatedwastewater)

20 mg/l ineffluent

2000 (treatedwastewater).

0.1 0.05(dischargeto surfacewater)

0.3

Soil QualityTotal petrogenic hydrocarbon (TPH) Limit for oil and grease contamination on

land10 ppm 20 ppm


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4.3 Land use Act of 1978 (amended in 1990) The Land Use Act addresses all matters relating to land acquisition and resettlement. This Act vests all land on the Governor of each state to hold in trust for the general public. The Governor exercises control over all urban land while non-urban land is in the control of the Local Government Authority. According to this Act, statutory rights of occupancy are granted by the Governor and customary rights of occupancy are granted by the local government authority. Land administration is usually handled by the ministry of lands in the various states. Lands in the Federal Capital Territory are managed by the Federal Capital Development Authority (FCDA) but the Abuja Geographic Information System (AGIS) is the custodian of all land data in the FCT. Based on the provisions of this Act the Governor can revoke statutory rights of occupancy in the interest of the general public. NEPA used to have power to acquire land for power projects but this power was lost to the reforms that brought about the implementation of the Power Sector Reform Act of 2005. PHCN now has to acquire land like every other individual or organization as provided by law and adequate compensation now has to be paid where resettlement issues are involved. The RPF covers land acquisition in detail.

4.4 International Conventions and Treaties Ratified by Nigeria Nigeria has ratified a number of international conventions pertinent to land administration, environmental protection and human rights. The awareness on climate change and global warming has impacted positively on the FGN and Nigeria is also a party to many Conventions and Treaties on climate change and global warming. Some of these conventions are: � Convention on Wetlands of International Importance, especially as Waterfowl Habitat

(Ramsar Convention) 2001 � Gulf of Guinea Large Marine Ecosystem Project (GOG-LME) 1999 � United Nations (UN) Convention on Biological Diversity 1994 � International Oil Pollution Compensation Fund 1992 (IOPC Fund), London, 1992 � UN Framework Convention on Climate Change, 1992 � Convention on the Control of Trans-boundary Movements of Hazardous Wastes and their

Disposal (Basel Convention) 1989 � Montreal Protocol on Substances that Deplete the Ozone Layer � Vienna Convention on the Ozone Layer 1985 � UN Convention on the Law of the Sea (UNCLOS), Montego Bay, 1982 � Convention for Co-operation in the Protection and Development of the Marine and

Coastal Environment of the West and Central African Region (Abidjan Convention) 1981 � Protocol Concerning Cooperation in Combating Pollution in Cases of Emergency in the

West and Central African Region, 1981 � Convention Concerning the Protection of the World Cultural and National Heritage

(World Heritage Convention), Paris, 1975 � Convention on the Prevention of Marine Pollution By Dumping of Wastes and Other

Matter, 1972 (amended 1992) � African Convention on Conservation of Nature and Natural Resources, 1968 � Turtles of the Atlantic Coast of Africa, 1999


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5 Description of the Nigeria Energy Sector

5.1 Reforms in the Energy Sector The Federal Government of Nigeria has made several efforts aimed at overhauling the electricity sector. The most significant of these is the enactment of the Power Sector Reform Act (2005) which unbundled NEPA into eighteen separate companies, brought in private sector participation, additional investments in generation projects through the National Integrated Power Project (NIPP) with an estimated 2,700 MW to be added to the national grid, established several regulatory agencies to act as watchdogs of the electricity sector (e.g. NERC and Rural Electrification Agency of Nigeria) and enhance rural access to electricity. The government also developed renewable energy blueprints to source alternative off-grid sources of power. These efforts were rewarded PHCN with increased revenue collection from about N 2.8 billion to about N 7.7 billion, improved reliability of supply, reduced system losses and resulted in an overall increase in the number of metered customers from about 40% of the population to 67%. There is still a wide gap between the total energy generated (about 2,200 MW in 2008) and the estimated demand (about 10,700 MW) and most of the policies needed to regulate the sector are still developing. The sector also has inadequate transmission and distribution infrastructure to cope with the anticipated additional generated capacity and demand. The Banks effort in bridging this gap in Nigeria through NTDP, NEDP and now NEIP is most commendable.

5.2 Sector Institutions

5.2.1 Federal Ministry of Energy

The Federal Ministry of Energy was established in 2007 to oversee the energy sector. The various sectors of energy (petroleum, electric, nuclear, and renewable energy) are all under the overall supervision of this Ministry - it manages all issues concerning the energy sector.

5.2.2 National Electricity Regulatory Commission (NERC)

The National Electricity Regulatory Commission was established by the implementation of the Power Sector Reform Act (2005). NERC, by this Act is charged with the responsibility of regulating the activities of the electric power sector. As part of its functions, the commission is to set rules and regulations and also enforce them. NERC also issues licenses and ensures compliance with market rules and other operating guidelines. The commission is headed by a chairman and is assisted by a vice-chairman together with other commissioners.

5.2.3 Power Holding Company of Nigeria (PHCN)

PHCN, formerly called NEPA, used to be the sole electricity utility in Nigeria responsible for electric power generation, transmission and distribution. The change in name to PHCN was effected by the implementation of the Power Sector Reform Act (2005). This Act unbundled NEPA into six generating companies (GenCos), eleven distribution companies (DisCos) and one Transmission Company of Nigeria (TCN). These companies would initially be government parastatals but would eventually become private companies. PHCN has an environment department that is responsible for ensuring compliance with environmental regulations. The PHCN has about forty-five (45) staff responsible for environment and resettlement issues, about one hundred and twelve (112) staff responsible for occupational health & safety and fire protection and about eighty (80) in the chemical laboratories scattered around the country. The Environment department is responsible for carrying out environmental assessment and management of projects to be embarked upon by PHCN while the Environment, Resettlement & Social Unit (ERSU) of PMU (an off shoot of


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PHCN ERSU) concentrates on same type of jobs in mainly the World Bank Assisted projects. This is as a result of the Bank’s insistence on sustainability of Projects it sponsored.

5.2.4 Rural Electrification Agency

This agency was established by the Power Sector Reform Act to regulate the expansion of electricity to rural areas. This is in view of the fact that the various distribution business units will eventually become individual companies and there will be need for a body to act as an umpire to set rules and enforce compliance in rural electrification. This agency is funded through ‘Rural Energy Fund’.

5.2.5 State Ministries of Environment

At the State levels, the state ministries for environment are responsible for all environmental issues (see also section 9.4) that concern their indigenes. There are ministries for youth and social development that handle social issues pertaining to welfare. These work in collaboration with the ministries for land and survey to handle issues pertaining to resettlement and land acquisition.

5.2.6 Generation Companies (GenCos)

There are six (initially, Jebba & Shiroro were under one management) generating companies carved out of PHCN. Three of these power stations are hydroelectric power stations and are located in the northern Niger state: Kainji, Jebba and Shiroro hydroelectric power stations. The other four GenCos hold four gas fired power stations: Afam, Ugheli, Sapele and Egbin. These power stations have some degree of autonomy by virtue of the Power Sector Reform Act. Each GenCo is headed by a CEO.

5.2.7 Transmission Company of Nigeria (TCN)

The transmission company of Nigeria is responsible for the transmission of electric power from the generating stations to the Discos through the national grid. This company is responsible for maintaining the national grid and wheeling energy to the distribution companies. The Transmission Company is headed by a CEO with head office in Abuja. The CEO oversees eight transmission regions (Lagos, Benin, Enugu, Port Harcourt, Osogbo, Shiroro, Kaduna & Bauchi), each headed by a Regional Transmission Manager (RTM) and thirty-five transmission substations/work centers, each headed by a Work Centre Manager (WCM). The WCM is responsible for the day-to-day running of the transmission substation but reports to the RTM who also reports to headquarters. TCN has Environmental and Resettlement Unit that was established as part of the capacity building plans in previous Bank sponsored projects. The essence of this is for them to manage all environmental and social issues emanating from all transmission projects and also for the management of all associated problems of day to day power transmission issues.

5.2.8 Distribution Companies (DisCos)

The unbundling of NEPA initially gave birth to eleven distribution companies corresponding to the eleven distribution zones in the country (a new zone has been calved out of Lagos). These distribution companies also have some degree of autonomy and at present are government parastatals that are expected to become privately owned. The distribution companies purchase power from Gencos and sell it to the consumers. It is expected that as time goes on and especially with projects being supported by the Bank, the DisCos will have their Environmental Units to manage the environmental and social issue involved with their operations. Such issues might equally be outsourced out if it is the general opinion that such related issues are not core areas in the DisCos operations.


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5.2.9 Other Sector Institutions/Policies

5.2.9.1 The Electric Power Implementation Committee (EPIC)

This committee was established by the National Council on Privatization (NCP) to carry out the synchronization, coordination and monitoring of all activities leading to restructuring and privatization of the electric power sector. The duties of EPIC include: formulation of blueprints for the reformation of the electric power sector; formulation and review of policies aimed at entrenching a vibrant and transparent power sector; source for sustainable private sector involvement in the power sector; and supervise the activities of all government agencies involved in the activities leading to the final privatization of NEPA.

5.2.9.2 National Electric Power Policy

In March 2001 the Federal Government approved an Electric Power Policy put together by EPIC to serve as a guide for the power sector reform process. This policy divides the reform process into Transition stage (coming on stream of Project Implementation Plans (PIPs), Emergency Power Providers (EPPs), restructuring and unbundling of NEPA and privatization of selected DisCos), Medium Stage (post privatization of NEPA – energy trading between GenCos, TCN and DisCos) and Long Run (competitive market and competitive pricing of energy to ensure the sustainability of investments by private sector. All Generating, Transmission and Distribution companies are expected to be fully privately owned as time goes on).


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6 NEIP Investment Project Description

6.1 Project Concept The development objectives of the NEIP Investment Project are to increase availability and reliability of power supply along with financial sustainability of the Nigerian power sector. A Secondary but important global objective would be the reduction of GHG emissions through reduced gas flaring and enhanced share of cleaner generation. NEIP is an Adaptable Program Loan (APL) i.e. a long-term engagement in the energy sector that is to be implemented in phases linked to progress in accomplishing planned sector reforms. An APL with two tranches is proposed as the lending instrument of the project. The first phase has two portions aimed at assisting the Federal Government by: (i) risk coverage to facilitate private investment in generating capacity and (ii) IDA funding for more investments. The project will have a structure of due diligence for selecting credible projects that will ensure compliance with relevant international and technical standards. The project would also implement a temporal subsidy mechanism to attract investments in generation while favorable tariff regimes are being developed. Also, the project would include additional investments (e.g. IDA) to develop extra capacity in generation, thus reducing subsidies, initiating alternative energy sources, driving positive changes in the domestic gas supply for the electric power sector, and would include a mechanism to reduce gas flaring and gain carbon credits for Nigeria. The APL is in two stages from 2009 to 2015 and is expected to add additional capacity of 1,500 - 2,000 MW to the national grid.

6.2 Project Components and Intervention Plans The project is divided into three main components based on the kind of investment being made and the sector in which the investment is being made: o Component 1 is a Partial Risk Guarantee (PRG) scheme with investments totaling about

$500 million of which $125 million is an IDA allocation. It is aimed at providing comfort for private sector investors in generation as well as assist government in establishing frameworks for the IPPs.

o Component 2 is a set of selective investments for improving generation, transmission and distribution infrastructure. US$ 330 million has been budgeted for this purpose and is aimed at reducing losses, ensuring efficient evacuation of power generated by the IPPs, restoring capacity at existing generating stations, helping power companies meet set objectives and enhancing skill transfer.

o Component 3 (US$ 20 million) supports policy frameworks and capacity building by developing Power Purchasing Agreements (PPAs), gas policies, long term power plans, designing gas infrastructure and assisting government to assess carbon credits. This component will support training programs for supporting companies, regulatory and implementing agencies as well as help prepare feasibility reports on coal-fired thermal plants.

The APL structure will have two phases which can run concurrently, with the purpose of demonstrating the WBG risk mitigation scheme in APL-I and scaling-up in APL-II, after the critical sector reforms already described have been put in place and begin to show results. 1. Phase I: APL I and Partial Risk Guarantees (2009 - 2014): In this phase, the Bank would provide: (a) PRGs for amounts of up to US$160 million (IDA allocation of US$40


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million3). The Government has nominated a number of candidate projects for the first phase,4 as the first demonstration projects for PRG support, although whichever one that will be supported has not been finalized. Additional PRG support may be considered in support of PHCN’s payments for gas supplied by the International Oil Company (IOC) Joint Ventures (JVs); (b) IDA Credits of US$18.7 million for rehabilitation of public sector generation plants; (c) IDA Credit of US$36.3 million for investments in critical transmission infrastructure and “best practice” distribution projects; and (d) technical assistance for an amount of US$ 5 million. 2. Phase II: APL II and Partial Risk Guarantees (2010 - 2015): This phase will be launched after the following pre-agreed objectives are met: (a) A transition subsidy mechanism is in place to meet the revenue requirement of PHCN companies until cost reflective tariffs levels are reached as per the Multi-Year Tariff Order (MYTO); (b) There is sustained gas supply to power plants with enabling gas policies; and (c) Performance contracts between the government and the power companies are in place. APL II will include:

(a) PRGs for US$340 million (IDA allocation of US$85 million) for additional IPPs and possibly for gas supplies to PHCN; (b) IDA credits for transmission and distribution investments (US$300 million); and (c) technical assistance (US$15 million).

The project is national in scope. The exact locations of the generating plants will depend on the IPPs that are accepted after due diligence. This will in turn determine the corridors for the transmission lines to connect the plants to the national grid. Gas will be sourced from the oil fields in the Niger River Delta, and it is possible that some of the generating plants will be located in the Delta as well. The gas-fired generating plants that are potential candidates for rehabilitation are in southern part of Nigeria. The net impact on gas flaring in the Delta will be positive, but the magnitude of the reduction cannot be predicted at this stage of the project development.

3 The PRG IDA allocation is 1/4th of Guarantee amount coverage. 4 Ibom power, Total, Gas sector


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7 Safeguards Preparation, Review and Approval Process This section describes the environmental and social management procedure that will form part of the preparation for due diligence on prospective subprojects for NEIP support, either by PRG or IDA funding. Compliance with this procedure will constitute part of the evaluation methodology for proposals, whether they be from private investors for potential gas-fired generating plants or from PHCN and the generation, transmission and distribution companies for power plant rehabilitation, construction of power transmission lines and or substations, or improvements in power distribution systems. This procedure incorporates guidelines and requirements from the Federal Ministry of Environment of Nigeria, the World Bank’s OP 4.01, and IFC’s Performance Standard 1. The steps in the process are project screening, environmental studies and document preparation, EIA review and approval, and oversight of implementation. Stakeholder consultation is an integral part of the preparation process, and public disclosure and comment are necessary prior to the decision to approve or reject a proposed subproject on the basis of environmental and social information. Screening; The screening decision has three parts: (a) the assignment of the environmental assessment category, (b) the determination of the safeguards instrument(s) that should be prepared, and (c) the identification of applicable safeguards policies. a) The first step is to assign an Environmental Category for the subproject. The proponent should propose the category, using the criteria discussed below. The ERSU of the Project Management Unit (PMU), in conjunction with the Federal Ministry of Environment, will review and confirm or modify the category, based on the description of the proposed activity and findings from field visits. Most subprojects in NEIP are most likely going to fall into World Bank Categories A or B, and FGN Categories I or II, depending on the type and scale of the activity, environmental and social conditions in the affected area, and location with respect to protected areas and other sensitive features of the natural and human environments. Criteria for Categories A and I are similar, as they are for Categories B and II. In case the categorization is split, e.g., Category B under OP 4.01 and Category I under the EIA Decree, the more stringent category will apply. Table 1 below provides guidance for screening based on the scale and type of project and the potential impacts that can be envisioned. Results from the table are automatically superseded by mandatory requirements for preparation of a full EIA, and thus for assignment to Categories A and I, that are specified in the Schedule to the EIA Decree. The mandatory requirements that could be applicable to NEIP are:

• Conversion of hill forest land to other land use covering an area of 50 hectares or more. • Logging or conversion of forest land to other land use within the catchment area of

reservoirs used for municipal water supply, irrigation or hydro power generation or in areas adjacent to state and national parks and national marine parks.

• Conversion of mangrove swamps for industrial, housing or agricultural use covering an area of more than 10 hectares.

• Construction of steam generated power stations burning fossil fuels and having a capacity of more than 10 megawatts.

• Construction of combined cycle power stations.


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Table 1: Likely NEIP Subproject Types, Major Environmental and Social Concerns and Probable Category

Environmental Category Project Type Potential Major Environmental and Social Concerns Safeguards Instrument

A. Generating Plants

A/I New combined cycle plants

Mandatory for full EIA according to EIA Decree EIA

A/I, or B/II for small facilities (< 50 MW) not in sensitive locations

New gas-fired turbine plants

Air pollutant emissions, GHG emissions, noise, loss of habitat, plant and gas pipeline security, land acquisition EIA or site-specific EMP

Rehabilitation of existing plants

Correction of “legacy” environment, safety and health issues; proper disposal of scrapped equipment.

Detailed environmental audit and action plan for remedial work; EMP for rehabilitation

B. Transmission and Distribution Systems

B/II except A/I for large new lines, significant impacts on natural habitat, or mandatory cases under EIA Decree

New transmission lines Loss of habitat, soil erosion, easier access to sensitive areas, land acquisition, loss of access to productive assets, aesthetic impact Site-specific EMP or EIA

New transmission substations

Soil erosion, land acquisition, Same as for transmission lines B/II New distribution lines and

substations Land acquisition, disturbance of local businesses, impact on aesthetics

Site-specific or generic EMP

B/II Upgrading of existing transmission and distribution lines

Resettlement of affected settlers, damage to habitat and infrastructure by construction vehicles, temporary disruption of business

Site-specific or generic EMP

B/II Reinforcement or upgrading of existing substations

Minimal impacts; may be “legacy” issues of environment, safety or health Generic EMP; preliminary

audit if appropriate Should be considered as an associated facility of the generating plant A/I or B/II if freestanding

Extension or new construction of gas delivery lines

ROW acquisition, safety and security issues

Normally covered under the generating plant EIA

Guarantee for regular delivery of gas through existing pipelines

Public health and safety, pipeline security, potential sabotage

Category B


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b) The second step is a decision on the safeguards instrument(s) that are necessary. Table 1 above provides an indication, but in many cases the decision depends, as noted there, on the scale and location of the project. The proponent of a subproject is encouraged to propose the safeguards instrument, but PMU will review and confirm. FMEnv should be consulted when there are questions of EA category or appropriate safeguards instrument, particularly when the subproject is or is likely to be in Category I. Rehabilitation of existing facilities will require environmental audits. Two levels of audit are commonly used – a preliminary audit to identify obvious problems for consideration at the feasibility study stage and to determine the scope of a detailed audit, which is the other level. The preliminary audit may be sufficient for relatively uncomplicated facilities without major problems, such as substations. A detailed audit is likely to be required for power plant rehabilitation, as the plants are old, may not have been well maintained, were built to different standards of environment and safety, and thus may have a number of significant problems that should be remedied in connection with the rehabilitation work. A detailed audit includes an action plan for the remedial work. If the rehabilitation work is extensive, involving delivery, installation, and disposal of major pieces of equipment, an EMP will also be necessary. In the special case in which NEIP is providing a guarantee to enable regular and reliable delivery of gas to power plants through existing gas pipelines, the pipeline owner/operator will be asked to carry out a pipeline integrity and safety study and to implement its findings. Any subproject involving land acquisition will trigger OP 4.12 and will likely need proponents to prepare an abbreviated or full RAP in addition to environmental impact management documents. The RPF for NEIP governs the preparation and implementation of RAPs. c) The third step is to determine which of the Bank’s safeguards policies that are triggered in general for NEIP and may be triggered by the particular subproject and what is required to comply with each triggered policy. This determination is subject to review by PMU and the Bank. Further information on these policies is available on the Bank’s website, www.worldbank.org. �Annex 3 contains information to help the potential operators determine which of the following Bank safeguard policies may be triggered by their subproject;

1. Environmental Assessment (OP4.01, BP 4.01, and GP 4.01) (Always Applies) 2. Natural Habitats (OP 4.04, BP 4.04, GP 4.04) 3. Physical Cultural Resources (OP/BP 4.11) 4. Involuntary Resettlement (OP/BP 4.12)

If any of the Bank safeguards policies are triggered by a subproject, the operator will modify the design, implementation, operation, maintenance and decommissioning phases to ensure that the subproject satisfies the requirements of that particular policy. Preparation of Environmental Impact Assessment and Environmental Management Plan Preparation of the applicable safeguards instrument is the responsibility of the subproject proponent/sponsor. In the case of new power generation, the investor has the responsibility and normally undertakes the work with the assistance of consultants. Gas delivery pipelines should be covered in the environmental studies for the power plant concerned. In some cases, the private investor may include the power transmission line in the project EIA and/or EMP as well, particularly if it is a short line to connect to a nearby, existing substation. For major new transmission and distribution lines and substations, and for reinforcement or upgrading of existing lines and stations, proponents will oversee EIA and/or EMP preparation by engaging consultants.


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Where an EIA is being required for a subproject, its proponents should take note of Article 2(4) of the EIA Decree that requires direct liaison with FMEnv:

All agencies, institutions (whether public or private) except exempted pursuant to this Decree, shall before embarking on the proposed project apply in writing to the Agency, so that subject activities can be quickly and surely identified and environmental assessment applied as the activities is being planned.

EIAs and EMPs must cover the minimum content specified in Article 4 of the Decree as well as in OP 4.01.�Annex 4 contains the Bank guidelines for the content of an EIA, and �Annex 5 contains guidelines for the preparation of an EMP, which may be free-standing for Category B sub-projects or part of an EIA for Category A.

Environmental Audits: Where a project involving significant retrofitting or upgrading of an existing industrial plant is being considered, an environmental audit should be carried out as part of the preparation for the upgrading, and this audit can provide the main documentation necessary for the environmental assessment. (All other relevant requirements of OP 4.01 must also be taken into consideration, particularly in relation to consultations, which is not usually part of the audit.) In an industrial context, the overall objective of an audit is to understand the scale and sources of the pollution problems at a facility or in a defined area and to set out the options available for dealing with those problems. There is often a staged process of investigation in which each stage is narrower in scope but more detailed than the preceding one. An initial assessment – a“preliminary audit” as planned for NEIP -- can be relatively quick, drawing on readily available sources, including site interviews, and providing an overview of the actual or suspected sources of pollutants and the extent of their impact. This overview can be carried out during project definition or at a scoping stage and provides a basis for further detailed investigations or for defining priorities for action. A useful function of the initial assessment is to describe data availability and needs and to indicate where site sampling and monitoring might be cost-effective. A full site audit is detailed, requiring careful site inspections (perhaps including sampling and testing) and review of past and present production processes, as well as pollution emissions and control measures. The audit should also clarify the legal and regulatory framework, licensing agreements, corporate policies, and management structures and priorities that affect the environmental performance of the plant. In many cases, relevant technical and environmental standards for performance may be ill defined or may not exist, and professional judgments will have to be made as to the appropriate benchmarks. However, it is essential that the standards or emissions limits proposed for the plants to be clearly defined and that the rationale for their selection be given. If full new plant requirements appear unachievable with the current plant, the audit should address what might be acceptable as realistic interim requirements. The audit should provide a list of recommended actions, in terms of increasing cost-effectiveness in addressing the critical environmental issues. This list should include interim and long-term targets and a timetable for achieving them, together with an indication of the investments and other resources (human, information, and so on) that would be required. More details on audits are available in the World Bank Group Pollution Prevention and Abatement Handbook. Pipeline Integrity and Safety Study: NEIP may provide a PRG to a supplier of gas, and the gas will likely pass through existing pipelines to the consuming facility. Assuming the supplier


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is in compliance with environmental permits issued by FGN, there is no significant negative impact from this arrangement, as no new facilities are being financed. However, it will be important to assess the integrity of the line, its safety record, and its vulnerability to accidental damage and intentional damage by third parties. This task is highly specialized and is normally carried out by contractors engaged by the pipeline operators, or the operators themselves. Much like an audit, the study report includes recommendations for actions to improve pipeline integrity and safety. The Escravos-Lagos Pipeline (ELPS), which is one likely conduit for gas supply under a PRG, was recently subjected to such a study in connection with the West African Gas Pipeline. The study reports are not disclosed, as they contain sensitive information that could be used by would-be saboteurs. Public Disclosure and Consultation: According to Nigerian law and World Bank OP4.01, public consultation is required as part of the EIA and/or EMP process. Section �Annex 1 below has a summary of consultations undertaken under NEIP so far, and The procedure for consultations on subprojects should conform to OP 4.01 and the EIA Decree. OP 4.01 requires consultation with stakeholders at least twice during EIA preparation for Category A projects – once early in the environmental studies to ensure that the terms of reference reflect all issues of concern and once after the final draft has been publicly disclosed but before the approval decision is taken. Article 7 of the EIA Decree specifies that

Before the Agency gives a decision on an activity to which an environmental assessment has been produced, the Agency shall give opportunity to government agencies, members of the public, experts in any relevant discipline and interested groups to make comment on environmental impact assessment of the activity.

More frequent consultation is encouraged on both Category A and B projects. For NEIP, safeguards work on subprojects entails an initial consultation of affected populations and interested NGOs as well as relevant agencies of federal, state and local governments, to inform them about the proposed activity and solicit recommendations, questions and concerns to be addressed in environmental and social assessment. Once drafts of safeguards documents are completed, they must be disclosed. Both Nigeria and the Bank require public disclosure of EIAs, EMPs, and RAPs. The Bank’s requirements are the most detailed and, to comply with them, safeguards documents for NEIP subprojects will be disclosed in the same way as the ESMF and RPF – that is, at public locations in the area affected by the project as well as in appropriate State and Federal agencies, and at the Public Information Center at the World Bank office in Abuja and the InfoShop at Bank Headquarters in Washington. It is a policy of the Bank that consultations and disclosure should be in form and language accessible to the stakeholders, and that consultation should continue throughout project implementation. Proceedings and results of consultations are to be summarized in the final versions of safeguards documents. All stakeholders, other agencies, NGOs, should be afforded the opportunity to review and comment on the documents disclosed. Following a time period adequate for the review of those documents, which for NEIP is defined as 60 calendar days for Category A subprojects and 30 calendar days for Category B, a second consultation is required, after which final comments are received and final documents are prepared and disclosed. The provision for public participation in the Nigerian EIA decree gives the public the right to comment after the submission of the draft final EIA report, where they can comment within 21 working days. However they do not have an opportunity to comment on the screening report of


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any of the projects subjected to full EIA. There is low awareness of the right to public participation, even though public participation is embedded in the FMEnv and DPR administered EIAs legislations. In part this is due to poor awareness of rights regarding public hearing on proposed projects, and regarding rights to object to proposed developments that can harm health and livelihood. Concerned stakeholders will be informed through disclosure of this ESMF that they have broader rights and opportunities to be consulted on NEIP subprojects, and that the 21-day comment period that applies in FMENV processing will not apply to the PMU-Bank review and approval procedure. Nothing in this discussion of consultation and disclosure is meant to preclude more frequent consultation between interested stakeholders and subproject proponents or their consultants. In fact, ongoing consultation is desirable and encouraged, either formally or informally. This has proven to be particularly valuable in establishing effective relationships with communities surrounding power plants and substations in Nigeria, in the Niger Delta and elsewhere. Safeguards Review and Approval: No proposed subproject can be approved for NEIP support until the required EIA, EMP, Audit or RAP, if any, have been approved by the cognizant agency. For any project requiring an EIA, approval from FMEnv is the first formal step. FMEnv has the discretion to require a public hearing as part of its review process, and to refer projects to a Joint Review Panel when it deems that to be appropriate. FMEnv’s review report is a public document, and EIA Decree 86 requires that it be provided to any interested party. PMU as part of its due diligence will have EIAs finally reviewed by the FMEnv, whether they are for power plants or transmission projects. The Bank will also review and approve EIAs for Category A subprojects, after FMEnv has issued the certificate that indicates satisfactory completion of the environmental assessment. The review process for subprojects that only require EMPs is simpler, as it does not involve FMEnv. The first reviewer will be PMU, via the ERSU. The Bank will review a representative number of EMPs for Category B. Subprojects would also have to be reviewed and cleared by the Bank, to ensure compliance with its safeguards policies. Bank prior review will be suspended if the initial EMPs are of good quality, and the Bank will thereafter review implementation of completed EMPs as part of project supervision. The Importance of EMP Implementation: The key to ensuring the sustainability of the NEIP lies in the planning and implementation of the EMP. If this is not done most of the potential risks highlighted in this document will become real causes for concern. To mitigate this risk the ERSU of PMU must be equipped to prepare and implement specific EMPs for the various investments in transmission and distribution subprojects as they arise. FMENV is mandated to monitor and enforce compliance with EIAs and EMPs for Category I projects, but ERSU will also monitor EMP implementation during construction and operation of new generating plants. FMENV normally makes quarterly site visits, and this practice will be adopted by ERSU to ensure strict compliance with EMPs by project proponents. The ERSU will conduct an audit of each facility to be constructed under the NEIP at least once in its lifetime, and the facility management should be encouraged to gear up towards ISO 1400 certification of their facilities.


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8 Potential Impacts of NEIP This section addresses the typical environmental and social impacts and the corresponding typical mitigation measures for the types of activities likely to be supported by NEIP. The information on impacts and mitigation measures is presented in three tables -- Table 2 for new gas-fired generation plants, Table 3 for new transmission lines, and Table 4 for rehabilitation of existing generating plants and substations. The tables are not intended to be exhaustive in content but rather to indicate in general the scope of EIAs and EMPs for NEIP-supported subprojects. It is entirely possible that additional impacts will be identified during impact assessment studies or audit preparation and will require additional mitigation measures. There are no separate tables for construction of new substations or installation of distribution lines. The impacts of these activities are almost certainly going to be a subset of the impacts of new generation facilities and transmission lines and are therefore subsumed in Table 2, 3 and 4. In the EIAs and EMPs, impacts shall be categorized according to project phase (planning, construction, operation, and decommissioning) and for all project types: generation plants, transmission lines, distribution projects.

8.1 Impacts of NEIP on the Niger Delta Each of the tables includes an entry concerning the Niger Delta, and it should be considered a mandatory part of the scope of the environmental studies for any subproject of NEIP. Since the Delta is the source of the gas for new and existing generating stations, any direct or indirect impacts of NEIP-supported developments on the human and natural environment of the Delta need to be considered. In addition, because of the history of interactions between Delta communities and the oil and gas industry, events in the Delta can have direct or indirect impacts on NEIP subprojects, even when they are not themselves located in one of the Niger Delta states. These can range from lack of cooperative relationships between communities and subproject operators to interruptions of gas supply, blockage of access to facilities, hostage-taking, and armed attacks. Sections 2.3 and 2.4 describe the situation in the Delta. Key issues to be considered in preparing EIAs and EMPs for subprojects are summarized here.

• The Delta communities historically seem not to have benefited proportionately from the extraction of oil and gas. Developers of new generation capacity should in any area consider how local communities can share in project benefits, and this is particularly true in the Delta. Communities directly affected should be electrified.

• Transparency and dialogue are essential ingredients for successful development in the

Delta. Given the history of conflict between communities and oil and gas industry, prospective developers under NEIP must establish and maintain good communication. This should encompass a range of stakeholders, not just those that represent one or other poles of the tension and conflict. This is important even for subprojects not located in one of the Niger Delta states; there are national NGOs with the mission of “peace in the Delta” that can provide valuable advice and that will support well-designed subprojects that contribute to that mission.

• Although gas flaring is not the sole or even the main cause of environmental degradation

across the Delta, it is looked upon as such by many residents and other stakeholders. It is certainly a waste of valuable natural resources, a major contributor to global warming, and a degrader of the local environment around each flare. There will inevitably be


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expectations that NEIP will reduce gas flaring. To the extent that it does so by increasing productive use of associated gas, it will be welcomed by stakeholders concerned about flaring. However, it is easy for unreasonable expectations to develop, and it is difficult for any individual generation project to trace the sources of gas, quantify the amount of associated gas consumed, and point to the extinguishing of any particular flare.

• Much of the Delta is wetland – mangrove and swamp forest – and as such, is a sensitive

and valuable natural habitat with high biodiversity. It is already under considerable stress from a variety of problems explained in Section 2. This needs to be considered in subproject site selection, design and construction. World Bank OP 4.04 will likely apply to any subproject located in the Delta.


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Table 2: Typical Impacts and Mitigation Measures for Gas-fired Power GenerationProject Activities /

Environmental Aspects Potential and Associated Impacts Mitigation Measures

Social unrest, potential conflict withlocal communities, disruption of work,risks to security of plant andpersonnel because of the history of oiland gas development in the Delta

• Maintain effective two-way dialogue through transparency and disclosure, full andfrequent information to the public and concerned NGOs, and established arrangementfor community liaison and for handling complaints and grievances

• Maximize employment opportunities• Ensure that projects provide appropriate benefits in the Delta – e.g., improved access to

electricity – being sure to consult with local representatives so that benefits provided arealso benefits that are wanted.

Direct or indirect impactson conditions in the NigerDelta (applies to allproject components)

Impacts on gas production and gasflaring in the Delta

• Where possible, contribute to reduction of flaring through use of associated gas• Where possible, record and report on quantities of associated and non-associated gas

used• Avoid creating unrealistic expectations with respect to how much impact the project will

have on flaringAnxiety among potentially affectedlandowners and users • Work through community liaison officers to keep public fully informed

Land acquisitiondissatisfaction with compensation;disruption of livelihoods • Prepare and implement resettlement action plan in accordance with the RPF

Loss of or damage to physical culturalresources

• Select sites to avoid cultural resources whenever possible.• Relocate or protect resources in consultation with national authorities and/or local leaders• Formulate and implement chance finds procedure

Loss or fragmentation of naturalhabitat, leading to reduction inbiodiversity and possible impacts onrare or endangered species

• Give preference in site selection to land already converted

Accumulation of brush and debris • Use appropriate disposal techniques; prohibit burning

Site clearance

Dust and soil erosion • Install erosion and sedimentation controls; periodic sprinkling for dust controlIncreased erosion tendencies, run-offs and sedimentation from gradingof access roads

• limit road expansion to the minimum required for safe operations• construct appropriate channels for run-off water

Access road creationLoss or fragmentation of or increasedaccess to natural habitat, with sameadditional impacts as above

• Give preference in site selection to land already converted• Restrict accessibility for workers and residents by fencing, posting, etc.

Onsite noise and vibration effects onthe workers

• maintain all work equipment at optimal operating condition• enforce use of PPE

Operation of heavyconstruction and haulingequipment

Disturbance by noise and vibration insurrounding communities

• maintain all work equipment at optimal operating condition• monitor noise levels at sensitive receptors (residential areas, schools, hospitals)• work through community liaison officers to agree on working hours and to respond

promptly to complaints


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Project Activities /Environmental Aspects Potential and Associated Impacts Mitigation Measures

Risk of accidents to life and property• Set and enforce speed limits• Mandatory driver training• Use warning signs and, where necessary, personnel to direct traffic

Damage to roads and otherinfrastructure caused by transit ofheavy trucks

• Routine inspection, and prompt repair of any damage

Alteration of surface drainage patternleading to erosion

• make sure drains are free from debris and other materials that would tend to obstructflow of water

• construct appropriate channels for runoff water and install erosion controls

Inhalation of toxic fumes by workersduring welding and paintingoperations

• ensure personnel wear nose mask• use competent personnel for operation

Risk of electrocution and burns duringwelding

• ensure strict adherence to standard work operations including the use of PPE (nosemasks, hand gloves, etc) as stated in HSES manuals

• ensure all electrical equipment is maintained at optimal working conditions

Workplace accidents / incidents(trip/falls etc)

• ensure HSE briefings are conducted prior to work commencement• ensure personnel wear adequate PPE• design work area to industrial standards

Onsite exposure of workers to noiseand vibration from use of heavy dutyequipment such as cranes andforklifts

• maintain all work equipment at optimal operating condition

Excavation / trenching /piling/construction

Loss of or damage to physical culturalresources • formulate and implement chance finds procedure

Inter and intra community conflicts

• work with community leaders to develop a mechanism for equitable distribution ofemployment and contracts for supplies and services

• monitor compliance to formula by local representatives• carry out periodic review of jobs, supplies and contract awards

Employment of locallabor and award ofcontracts to members ofthe host communities

Increased cash flow and stimulationof local economies within the hostcommunities

To enhance this• permanently retain some of the unskilled local hands to encourage them in acquiring

basic skill for self-sustenance on disengagement/retirement• Some technically inclined members of the host communities shall also be engaged on

full or part - time basis as may be required


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Localized economic benefits frommaterials supplies by local contractors

To enhance this beneficial impact• continually encourage the local contractors through the award of contracts as would be

required, according to their competence levels• maximize local hiring through community liaison to advise of numbers and skills needed

and give first preference to qualified candidates from the local area

Increased pressure on existing socialamenities / infrastructure especiallyhousing

• establish co-operative and open working relations with the host communities throughoutthe project life cycle

• establish a self sustaining base camp in the project area• construct infrastructural facilities in the area to ease pressure on the existing

amenities/infrastructureStimulation of local economies andmarkets from increased demand forfood, and other products in the localmarket

• economically encouraging the locals through patronage to their businessesInflux of workers into thehost communities

Socio-cultural conflicts between theconstruction team and members ofthe host communities

• ensure that its workers are briefed on the socio-cultural norms and sensitivities of thehost communities before commencement of work in the area

• ensure that all the community leaders are made aware of the project activities andimpacts, and encouraged to make inputs in appropriate mitigation measures

• explore ways of encouraging goodwill and friendly relationship between itsworkers/service contractors and members of the host communities to facilitate flow ofinformation to and from the host communities

• Personnel shall be encouraged to participate in community development affairs

Influx of workers into thehost communities

Introduction of communicablediseases (STDs/HIV, diarrhea etc),into host communities

• conduct a basic health and safety awareness course for all personnel• Medical examination shall be conducted for all workers and any one suffering from

communicable disease shall be properly treated prior to mobilization to site• ensure that all reported cases are isolated and prompt and adequate medical treatment

administered

Exposure of workers and nearbycommunities to excessive noise fromthe power plant

• maintain equipment and facilities at optimal operating conditions as stated in theequipment operating manual

• Equipment with low noise rating shall be used• install noise barriers around high noise areas in the facility• periodically monitor noise levels and adhere to prescribed limits in the workplace, at the

plant boundary, and in surrounding communities• provide ear muffs and enforce their use enforced in high noise areas on site

Power GenerationActivities•

Surface water contamination fromdischarge of water containingentrained oil/chemicals

• ensure that the efficiency of the wastewater treatment plant and oil separators areoptimized so that effluents meet regulatory limits before discharge


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Contamination of soils, surface wateror groundwater from spills and leaksof transformer oil.

• Ensure that design includes a retention basin around each piece of equipment ofsufficient size to contain the entire contents of oil reservoirs.

• Provide adequate storage for new and used oil, with retention capacity to preventescape in the event of leaking drums.

Degradation of ambient air qualityfrom routine operational emissions ofair pollutants (COX, NOX, SOX, andVOC) from fuel combustion engines

• maintain fuel combustion engines at optimal operating conditions as stated in theequipment operating manual

• periodically monitor air emissions• apply appropriate pollution control technology, such as water injection to reduce

emissions of NOx

Improved stability in power supply tothe immediate communities and theregion

enhance this beneficial impact by:• carrying out periodic inspection and maintenance of the operational equipment• encouraging the locals, through consultation, to report all observed electrical faults to the

appropriate authorities• discouraging the locals from sabotage through direct education, newspaper publications,

etcInduced secondary industrialdevelopment due to improved powersupply in the region

• enhance this impact by maintaining the stability in power supply

Fire and explosion from pipeline leaks/ rupture leading to loss of life anddamage to asset

• coat flow-lines with anti-corrosive materials• put in place an effective routine monitoring for sabotage, pipeline damage and leaks• develop an oil spill contingency plan for prompt clean up• train all workers involved in the project on fire prevention techniques• conduct frequent fire drills at the project site to acquaint personnel with fire fighting

techniques• ensure adherence to documented work instructions• ensure that job hazard analysis is conducted for all fire sensitive activities• provide fire prevention and fighting apparatus• develop emergency response plan for the facility, in consultation with local communities

and emergency service agencies

Power GenerationActivities

Water quality degradation (whereonce-through cooling water system isused)

• shall ensure that the water cooling system is maintained at optimal operational capacityso that the discharge temperature is compatible with the surface water

Borehole Drilling Depletion of groundwater resourcesavailable for other users

• monitor and control the use of water to reduce wastages• ensure all taps and water pumping and transmission mechanisms are maintained at

optimal working conditions


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Disposal of packaging materialsthereby leading to soil / waterpollution

• adopt an effective waste management practice• conduct environmental awareness training in waste handling for personnel

Warehouse ActivitiesInjuries / death from objects fallingfrom heights on personnel (forklifts,packing racks etc.)

• ensure personnel wear appropriate PPE at work area• ensure safety briefings are conducted prior to commencement of work• ensure all gangue ways are cleared of obstruction to avoid accidents• provide first aid facilities at strategic points• train personnel in first aid administration

Soil/groundwater contamination dueto increased heavy metalconcentration from disposal of metalfines and scraps

• ensure that solid wastes are categorized and containerized to prevent contact with soiland groundwater before being transported to disposal site

Process and equipmentmaintenance

Workplace accidents / incidents (cuts,trip/falls, etc) leading to injury / deathof personnel

• develop, maintain and ensure strict adherence to documented standard work instructionsfor HSE critical activities

• All staff and contractors concerned with the IPP project shall be informed and trained onthe relevant accident prevention methods

• conduct periodic training and continual safety reminders to all operating staff• ensure that job hazard analysis are carried out for all operational activities before work

commences

Sewage / Waste watertreatment process

Degradation of the surface waterquality (pathogens, BOD, nutrients,etc) from accidental release ofuntreated effluent (sewage,wastewater) from boarding facilities

• monitor and ensure all effluent discharge meet the FMENV limits before disposal• maintain treatment plant in good working order

Emergency PowerSupply

Soil / groundwater contamination fromaccidental fuel/engine oil spillrefueling

• Sponsor shall train personnel in safe fuel handling• Sponsor shall use drip pans to contain any spills during refueling activities

Decommissioning /Abandonment of facilities

Availability of land for alternative usese.g. creation of new settlements

• Clean up and remove any wastes or contaminated soils.• Make the site safe for human access or fence or seal off areas that cannot be made so.• Remove equipment• Leave building in usable condition• Maintain liaison with communities and local government on final disposition of site.


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Table 3 Typical Impacts and Mitigation Measures for New Transmission LinesProject Activities /


Social unrest, potential conflict withlocal communities, disruption of work,risks to security of line and personnelbecause of the history of oil and gasdevelopment in the Delta








have on flaring

Anxiety among potentially affectedlandowners and users • Work through community liaison officers to keep public fully informed

dissatisfaction with compensation;disruption of livelihoods • Prepare and implement resettlement action plan in accordance with the RPF

Loss of natural habitat• Give preference in site selection to land already converted• Select alternative alignments to avoid protected areas and other sensitive natural

features

Acquisition of Right ofWay (ROW)

Loss of or damage to culturalresources

• Select alternative alignments to avoid physical cultural resources• Where avoidance is impossible, comply with World Bank OP 4.11 and consult with

national authorities and/or local leaders on best way to preserve or relocate culturalproperty.

• Formulate and implement chance finds procedureLoss or fragmentation of or increasedaccess to natural habitat, leading toreduction in biodiversity, possibleimpacts on rare or endangeredspecies

• Give preference in site selection to land already converted• Set and enforce restrictions on hunting by workers• Minimize width of cleared area• Use labor-intensive mechanical clearing methods to maximize employment opportunities

and avoid impacts of herbicides

Accumulation of brush and debris • Use appropriate disposal techniques; prohibit burning

Clearance of ROW

Dust and soil erosion • Install erosion and sedimentation controls; periodic sprinkling for dust controlSoil / groundwater contamination fromaccidental fuel/engine oil spillrefueling

• train personnel in safe fuel handling• use drip pans to contain any spills during refueling activities

Tower Construction andCable Stringing

Onsite noise and vibration effects onthe workers

• maintain all work equipment at optimal operating condition• enforce use of PPE


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Disturbance by noise and vibration insurrounding communities

• maintain all work equipment at optimal operating condition• monitor noise levels at sensitive receptors (residential areas, schools, hospitals)• work through community liaison officers to agree on working hours and to respond

promptly to complaints


Damage to roads and otherinfrastructure caused by transit ofheavy trucks

• Routine inspection, and prompt repair of any damage

Exposure to electromagnetic fieldsTransmission lineoperation Risk of electrocution, injury or

property damage

• Prevent encroachment and enforce restrictions on activities in ROW• Post warning signs and design towers to prevent access to conductors by unauthorized

personnel

Damage to natural habitat

• Set and enforce restrictions on hunting by workers• Minimize width of cleared area• Use labor-intensive mechanical clearing methods to maximize employment opportunities

and avoid impacts of herbicidesAccumulation of brush and debris • Use appropriate disposal techniques; prohibit burningSoil / groundwater contamination fromaccidental fuel/engine oil spillrefueling

• Sponsor shall train personnel in safe fuel handling• Sponsor shall use drip pans to contain any spills during refueling activities

Transmission linemaintenance



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Table 4 Typical Impacts and Mitigation Measures for Rehabilitation of Existing Generating Plants and SubstationsProject Activities /


Social unrest, potential conflict withlocal communities, disruption of work,risks to security of plant andpersonnel because of the history of oiland gas development in the Delta








have on flaring

Workplace health and safety risks arenot being adequately managed

Effluent, emission and noisestandards are not being compliedwith. Ambient conditions in the areaexceed standards.Solid waste management issubstandard, with abandonedequipment and accumulations of trashand litter widespread.

EnvironmentalManagement Plan andHealth and Safety Plando not exist or are notbeing implemented.

Spills and leaks have contaminatedsoil, structures, and possiblygroundwater

• Develop and/or implement EMP and HSE Plans• Correct substandard conditions requiring urgent attention• Develop and implement and action plan to correct other deficiencies• Identify and empower (or recruit) responsible individuals to manage health, safety and

environment at the facility• Start or restart awareness training

No database by which to judgecompliance with standards in theworkplace, or in effluent andemissions

Environmental andhealth and safetymonitoring is not beingconducted No database to discern effects on

ambient conditions

• Formulate and/or implement monitoring plans• Repair or obtain monitoring equipment• Identify and empower (or recruit) responsible individuals to manage monitoring program

Workers exposed to hazardoussubstances such as asbestos, PCBcontamination

• Restrict access and provide protective equipment until condition is abatedImmediate and severehealth and safety risksexist in the workplace

Workers exposed to high noise levels,poor ventilation or lighting, etc.

• Correct conditions• enforce use of PPE


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Workers exposed to risk ofelectrocution because of old orpoorly-maintained equipment, lack ofsafety procedures

• post warning signs and restrict access until condition can be abated• institute or reinstate “lock-out and tag-out” and similar procedures

Workers exposed to riskHazardous substancecontamination

Contamination has or may spread off-site through air, surface orgroundwater, or improper disposal

• Obtain expert advice in developing a remediation plan• Implement the plan• In the interim, contain the contamination and restrict access to contaminated areas• Test local water supplies and, if affected, provide alternative sources

Social conflict between the facility andthe surrounding communityVandalism or sabotage

Inadequate securityprovisions for the facility

Risk of electrocution or injury fromcontact with high-voltage equipment

• Establish effective, ongoing community relations program• Install fences and other security features around all dangerous or vulnerable facilities• Post warning signs• Employ security personnel, ideally from local area


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9 Institutional Capacity for Environmental Management

9.1 ERSU Skills and Gaps The Environment, Resettlement and Social Unit (ERSU) was established within the Project Management Unit (PMU) of PHCN to ensure compliance with national and international environmental regulations and with the Bank’s safeguard policies. The staff includes environmental and social specialists. ERSU has a proven track record of satisfactory preparation of EIAs, EMPs, and/or Environmental Audits for transmission and distribution system investments following the framework approach. Two Bank supported projects in the sector implemented by the PMU – the Transmission Development Project (TDP) and the National Energy Development Project (NEDP) – have ESMFs. The NEDP also has an RPF, and ERSU has also prepared the terms of reference for the first RAP that was used in the NEDP. ERSU has been responsible for formulating the PHCN environmental policy, the TCN environmental policy and, more recently, its “HIV/AIDS Work Place Policy”. Through the efforts of the ERSU, and with Bank support under TDP, TCN now has an environmental and social unit in its Abuja head office and is posting additional staff in the transmission substations. This represents a substantial expansion of environmental and social management capacity for transmission activities. ERSU is made up of staff from the PHCN headquarters and TCN headquarters and reports directly to the Manager PMU. The ERSU will be responsible for overseeing safeguards compliance in NEIP on behalf of PMU, the PHCN Headquarters and TCN. ERSU was initially created to oversee transmission projects, and its capacity in that field is adequate. It has extended its capability to environmental monitoring of HVDS projects under the NEDP. The ERSU has acquired skills in resettlement operations, environmental management, environmental audit, HIV/AIDS awareness and general project management. Capacity within the ERSU has improved significantly over the years with the department conducting impact assessments for sub-projects under various Bank assisted power projects. The most recent effort of the unit in this regard is the preparation of the ESMF and RPF for this project with the assistance of Bank safeguards staff. Under NEIP, its role will expand to include oversight functions in compliance with the ESMF and RPF by IPP sponsors and their contractors. The ERSU will also help project implementers with all environmental, resettlement and social issues as well as with project monitoring and reporting on environmental and socio-economic matters. Direct regulatory oversight will be provided by the Federal Ministry of Environment, which is the permit-issuing authority in Nigeria. ERSU will be monitoring to keep PMU and the Bank informed on safeguards performance. For this purpose, it is recommended that they receive additional training to cover environmental and social aspects of power generation under NEIP, Bank policies and operations, and issues of global warming, climate change, biodiversity conservation and ecosystem management. They will be happy if the Bank can arrange this training in any of the Bank’s training institute.

9.2 PHCN PHCN has an Environment, Resettlement and Social Unit (ERSU) that is responsible for ensuring compliance with environmental, resettlement and social regulations. The unit comprises of professionals experienced in occupational health and safety, way-leave (for property valuation and compensation). The remaining staff major in Chemistry and Laboratory Sciences. These


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monitor standards for the effluents and other activities of PHCN that must conform with laid down chemical specifications. The environment department in the PHCN is responsible for carrying out environmental assessments of projects to be embarked upon by PHCN while the ERSU of PMU concentrates on World Bank Assisted projects. Periodic Audits of the PHCN facilities are done through hired consultants and the reports are forwarded to the Federal Ministry of Environment as required by law.

9.3 Federal Ministry of Environment (FMEnv ) The Federal Ministry of Environment is the agency of FGN responsible for setting policy guidelines on environmental issues and ensuring compliance with national environmental standards. They have different departments with field offices in every region of the country. The department has three main divisions:

• The EIA Division – This division is responsible for review of EIA of all new projects. The environmental regulations of the federal government require that environmental assessments be carried out for different categories of projects as stated in the Environmental Impact Assessment Act (1986). This division ensures that the required level of assessment is complied with depending on the kind of project and the degree of impact on the environment. The division also ensures that various review mechanisms for an EIA are properly applied, with emphasis on the participation of the stakeholders. For existing facilities, the Act requires that periodic (every three years) environmental audits be conducted and the reports of such audits reviewed by the ministry. They are responsible for issuance of environmental certificates and permits.

• The Standards and Monitoring Division – This division sets environmental standards and

also monitors compliance with such standards e.g. water quality, air emission, pollution standards etc. The standards monitoring division requests data of relevant emissions and discharges from various establishments and checks for compliance or defaults to apply necessary sanctions.

• Oil and Gas Division – This division is responsible for the monitoring of environmental

compliance in the oil and gas sector. The Federal Ministry of Environment (FMEnv) has the mandate to provide overall policy guidance for environmental management across the country at all levels of government, including EIA issues. However, it faces some implementation issues, summarized below:

• FMEnv has low capacity for monitoring and data collection, there is no central data collation/management, and the data are segregated, limiting the meaningful usage in environmental planning. Data sharing, within the ministry, and across departments is limited. Thus, monitoring plays only a limited role as a mechanism to guide decision making, and impact of interventions are not properly measured.

• Because there are three different EIA processes currently operational in the country,5

there are no common interaction procedures with urban and regional planners. The existence of three different systems and three different sets of agencies create confusion and increases transaction costs. For instance, permit seekers get approval from one of the agencies ignoring the others creating conflict and confusion both for proponents and the agencies themselves.

5 EIA of the Petroleum Act (DPR), the Town and Country Planning Decree, and the EIA decree 86


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• There are numerous loopholes in the three sets of legislations, and the legislation allows projects to be excluded from EIA requirements in the case of a national emergency or if they are considered to be in the interests of the public health and safety.

9.4 Relationship between the Federal Government and States The relationship between the federal government and states is the subject of ongoing debate in Nigeria. Under democratic rule, state governments have become much more powerful compared to under previous military regimes States and Local Government Councils (LGCs) are encouraged to set up their own environmental protection agencies. There are however, numerous differences between states in terms of institutional arrangements for environmental management. In some states such as Adamawa, there is a Ministry of Environment and a self accounting EPA that reports to the Commissioner of Environment. In others, such as Cross River, the EPA is subsumed within the State Ministry of Environment. Individual EIA preparers under NEIP should refer to local state laws and regulations and assess the institutional arrangements and capacity in the relevant state(s) while carrying out environmental and social assessment.


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10 Summary of Consultations on the ESMF for the NEIP This ESMF is subject to the same consultation and disclosure requirements that are described in Section 7 for the individual EIAs and EMPs. The only difference is that because specific subproject locations are not known, affected communities cannot be identified. Consultation is thus conducted at the national level with representation from stakeholder groups. Disclosure is at the national level but also in states and local government areas where NEIP activities are likely to occur. The ESMF will be available to all interested parties via the Bank’s InfoShop (www.worldbank.org/infoshop) and the website that will be established for the project.

10.1 The Initial Consultation The PMU and the World Bank convened a half-day workshop at the Bank’s Abuja Office on May 2, 2008, to listen to the opinions and recommendations of stakeholders as part of the planning for NEIP. The Bank made particular efforts to include civil society organizations that focus on environmental and social issues in the Niger Delta. There were 39 participants, including representatives from 18 different NGOs, Ministry of Finance, NERC, PHCN, NNPC, and REA. Collectively, the civil society representatives made 21 specific recommendations for NEIP and/or Bank activities in the energy sector and in the Niger Delta. Examples are: having an independent monitoring body for NEIP so that the public can “separate truth from fiction”, involving Delta communities in project implementation to build ownership, obtaining the views of grass-roots organizations in the Delta rather than only those of militant organizations, consulting communities during plant site selection, giving priority to employment for youth, and ensuring that private power developers provide electricity for communities surrounding their plants. Participants expressed appreciation for the opportunity to work with the Bank at such an early stage in the development of a project, and all attendees agreed that this form of consultation should continue, with additional, more detailed consultations at state and local levels as the project proceeds. Details of the discussions and a list of participants are in Annex 1_.

10.1 Consultation on the Draft ESMF To be completed after the 120-day comment period has elapsed and consultations on the draft held.


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Annex 1. Summary of Consultations Under NEIP, the following consultations have already taken place:

(Annex) 1.1 Stakeholders’ Workshop, WB office, Abuja, May 2, 2008 Purpose of the Workshop: The workshop was convened to listen to the opinions and recommendations of stakeholders as part of the planning for a proposed new project, NEIP, which has the primary objective of assisting Nigeria in meeting its shortfall in electric generating capacity and which will be supported by IDA and MIGA. A wide range of stakeholders was therefore invited, including government, the power utility, and NGOs. The Bank made particular effort to include NGOs that focus on environmental and social issues in the Niger Delta, since NEIP is intended to facilitate private-sector development of gas-fired power plants. Some of those plants will be located in the Delta, and all of them will use gas from oil and gas fields in the Delta. Participants: A complete list of the 39 participants is shown in Table 1-1. Eighteen different NGOs were represented. Officials from Ministry of Finance, NERC, PHCN, NNPC, and REA attended, along with four Bank staff. Presentations: The bulk of the agenda was devoted to questions, comments, and recommendations from the invited guests. Presentations by the Bank were brief and covered the Bank’s activities in the energy sector in Nigeria, Bank-supported projects and programs in the Niger Delta, the concept and preparation schedule for NEIP, and the arrangements necessary to ensure that NEIP complies with Bank Group social and environmental safeguards, including emergency response planning, public disclosure and ongoing consultations. Issues and Questions Raised and Recommendations Made by the Invitees: The NGOs posed a number of questions, to which Bank staff and Government or utility officials responded. The questions covered a wide range of topics.

• In the case of individual power plants, is there a plan for people who are displaced? Is there a plan for gas plant emergencies? Will communities get some benefits from the plants? When and how will community members get involved with the project?

• What level of consultation will go on in the states as this project proceeds?

• Will there be any investment in renewable energy sources? When will the Bank assist Nigeria in exploring other energy sources, especially solar?

• What is different about this project compared to that of the AFC?

• Is the Bank satisfied with the results of $400 million in loans to the energy sector (TDP and NEDP)?

• Why not build small, localized power plants that serve 20-30 communities and avoid the cost and impact of transmission?

• How will the project contribute to reduction in flaring when FGN has already legislated flare out by the end of 2008?

• Can the project accommodate purely private investments, i.e., not public-private partnerships, with PRGs?


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The NGOs offered a large and useful list of recommendations, not only for NEIP but for Bank activities in the energy sector in general, and in the Delta.

• NGOs have met with Min. of Energy, NNPC and others and agreed on a program to phase out flaring, but there has not been much progress. It is critical to involve state governments in flaring reduction, and Bank should be sure to do this; otherwise there will be nothing but frustration.

• There should be a firm commitment from this project to use associated gas. We are still waiting for such a commitment from WAGP.

• Civil society has difficulty sorting out truth from fiction in media reports about energy issues. The World Bank should set up an independent monitoring mechanism for the project. The TTL for NEIP welcomed this suggestion and said we would accept it.

• Civil Society Coalition for Poverty Eradication offered to become involved in any continuing consultations. They have been mapping communities in the Delta and working with them.

• It is not true to say gas is “clean”. I urge the Government and the Bank to look at small plants using renewables, not necessarily in this project but in general. “Do not neglect renewables.”

• Be sure to ask the community “what” and “where” before you give them something you think is a benefit to them. The speaker gave the example of boreholes provided by another donor that are located too close to the community center and consequently have never been used.

• Is there any way to involve communities in implementation, not just in monitoring? If they are directly involved, they will “own” the projects and help to take care of them.

• Involve youth in the governance of the Niger Delta.

• It is good that you have invited groups like these. Many times the groups invited from the Delta are the same old ones, and they are part of what causes the problems there. New groups are striving for peace in the Delta.

• Taking information from the grass roots in the Delta is important. The militants provide a distorted view. Widen your consultations.

• Involve relevant state and local governments in subsequent consultations.

• Make sure that environmental and social safeguards are adhered to, especially resettlement, compensation, and proper disclosure of documents including the environmental and social frame works.

• “We are in a culture of no maintenance.” World Bank should insist on a maintenance culture, with community participation in securing project equipment and good leadership and management of proposed projects and pro-poor programs.

• World Bank should embark on a community outreach program, targeting youth.

• Involve non-government actors continuously in the monitoring of the project, to guard against corruption. World Bank funds are not always reaching the intended beneficiaries because of corruption and governance issues.

• Consult local communities on power plant site selection.

• In consultations, do not deal only with the Chiefs, to the exclusion of community members and affected persons.


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• Emphasize off-grid systems; they do not require transmission infrastructure.

• Finding employment for unemployed youth in the project target area should be a priority.

• Be sure there is distribution of electricity to communities around a project site.

• Be aware of the impacts of gas-to-power projects on communities: emergency situations and accidents, land acquisition and compensation, resettlement, and benefit-sharing.

Evaluation: From Bank staff’s point of view, the workshop accomplished its purpose and yielded immensely valuable recommendations. The Bank committed itself to continuing the dialogue with this group, accepting the recommendation for independent monitoring of the project by non-governmental entities, maintaining transparency, and holding more detailed consultations at state and local levels as part of due diligence when investments that may be supported by NEIP are being considered. Judging from comments made by the NGO participants, the workshop was a success from their standpoint as well. Many speakers expressed their appreciation for the initiative and their willingness to partner with the Bank for the success of the project. They are looking forward to having a more robust working relationship with the Bank.


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Table 1-1. Stakeholder Workshop for Nigeria EnergyInfrastructure Project:List of Participants 'DWH� 0D\ ��

S/N NAME JOB TITLE ORGANIZATION ADDRESS TEL./FAX E-MAIL

1

LAWRENCE ETUKUDO

PROJECT MANAGER COMMUNITYEMPOWERMENTSERVICES

205 AKA ROAD, UYO,AKWA IBOM

0802 435 9150 [email protected]

2 EDEM EDEMPROGRAMCOORDINATOR

ABGREMO FORDEVELOPMENT

43/48 MAYNE AVENUEBY WEBER STR,CALABAR 0803 711 4770 [email protected]

3 ODAMA T. ODAMA PROJECT MANAGER EDEM’S C. FOUNDATION23 ETINYIN ABASI STR.PORT HARCOURT 0802 529 3336 [email protected]

4 SAVIOUR AKPAN EXECUTIVE DIRECTORPOLICE COMMUNITYPARTNERSHIP FORUM

44 IKOT ABASI ROADAKWA IBOM

0802 381 1786,0806 668 0864

[email protected]

5 PRINCE ABASIEDINWEN PRESIDENT-GENERAL GLOBAL PEACE MISSIONELENUWA STR, PORTHARCOURT

0803 786 0100,0805 515 0500

[email protected]

6 MIMIDOO ACHAKPA EXECUTIVE DIRECTOR WREP GADUWA ABUJA 0802 339 0227 [email protected]

7 VIRGY IFEADIFI RESEARCH/PROJECT JDPC GADUWA ABUJA 0803 604 2326 [email protected]


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8 OBIKEZE NNANAPROGRAMCOORDINATOR GCSPP AREA 1, ABUJA 0803 340 4605 [email protected]

9 THOMAS WALTON CONSULTANT WORLD BANK WASHINGTON DC 0703 662 2873 [email protected]

10 WAQAR HAIDERSNR. ENERGYSPECIALIST WORLD BANK WASHINGTON DC 0803 296 7971 [email protected]

11JOHN GABRIELGODDARD ECONOMIST WORLD BANK WASHINGTON DC 72024588623 [email protected]

12PRASADTALLAPRAGADA

TEAM LEADER NIGERIAENERGY WORLD BANK WASHINGTON DC 2024585600

[email protected]

13 GODWIN NWAOKWEPROGRAMCOORDINATOR CODET

15 RUMU-IBEKWEHOUSING EST. PORTHARCOURT 0803 612 8360 [email protected]

14 COMFORT B. SAKOENVIRONMENTOFFICER PHCN-PMU

7 KAMPALA STR.WUSE2 0803 324 4649 [email protected]

15 DESMOND CHIESHE PROJECT OFFICER WEP WEP ABUJA 0803 863 [email protected],[email protected]

16 PST. PETER AGWEGHU BUSINESS PARTNER NIGER DELTA YOUTH47 ENE OBONG,CROSS RIVER STATE 0805 651 0717

[email protected]

17 INOH OKOKO PRESIDENTNIGER DELTA YOUTHPARLIAMENT 7 NSIKAT ETUK , UYO 0806 486 4752

[email protected]

18 DR. LAMI ADEBAYO EXECUTIVE DIRECTORNATIONAL ORIENTATIONAGENCY NATIONAL H/Q ABUJA 0803 349 7161

[email protected]


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19 BARR. MIKE KARIKPI PROGRAM MANAGERENVIRONMENTALRIGHTS ACTION

10 IBAA STR. PORTHARCOURT 0803 552 6729 [email protected]

20 ENGR. I. NZERMASNR. SCIENTIFICOFFICER

ENERGY COMMISSIONOF NIGERIA

BEHIND NATIONALMOSQUE, ABUJA 0708 441 5597 [email protected]

21 ENGR. SAM GEKPE MD/CERURAL ELECTRIFICATIONAGENCY

16 GWAN STR. WUSEZONE4, ABUJA 0803 311 6776 [email protected]

22 MRS K. NANLE DIRECTOR(FUND)RURAL ELECTRIFICATIONAGENCY

16 GWAN STR. WUSEZONE4, ABUJA

23 MATHEW ONWUSESNR.MANAGER(PROG/MGT

RURAL ELECTRIFICATIONAGENCY

16 GWAN STR. WUSEZONE4, ABUJA 0805 852 0173

24 MR C.A. JOSIAH SA-MD/CERURAL ELECTRIFICATIONAGENCY

16 GWAN STR. WUSEZONE4, ABUJA 0803 786 2502 [email protected]

25 MR JIMI OKON DM, NNPC PROJECT NNPCCENTRAL BUSINESSDISTRICT 0802 323 2468 [email protected]

26 MR A.S. ADOLE ASST. MANAGER - EMT PHCN-PMU7 KAMPALA STR.WUSE2 0803 619 7138

[email protected] ,[email protected]

27 MR SOEZE C.A. HR OFFICER PHCN-PMU7 KAMPALA STR.WUSE2 0803 349 8838 [email protected]

28 MR AGI ONDA A/MEDIA GRP‘ GPM1 ELELEMWA PORTHARCOURT 0802 549 5097

[email protected]

29 BAYO ADENIYI MANAGER PHCN-PMU7 KAMPALA STR.WUSE2 0803 306 2521 bayoadeniyinepapmu.ng

30 MOHAMMED U.G. ACCOUNTANT PHCN-PMU7 KAMPALA STR.WUSE2 0803 314 5498

[email protected]

31 NGENE EMEKAPROJECTCOORDINATOR

CIVIL SOCIETYCOALITION FORPOVERTY ERADICATION

1 GOBA CLOSE OFFMONROVIA STR,WUSE2, ABUJA 0803 372 9696

[email protected]

32 EKWERE G. SAO(INFRASTRUCTURE) FED. MIN. OF FINANCE ABUJA 0803 314 2070 [email protected]

33 SUWAIBU JIBRIN PROGRAM MANAGER ACTION AID

2ND FLOOR NAICBUILDING, CENTRALAREA, ABUJA. 0803 618 0663

[email protected]

34 CUFE UDONG EXECUTIVE DIRECTOR CARD, UYO164 IKOT EKPENEROAD, UYO 0802 290 9148 [email protected]


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35 PST. MARY AWUKAMNIGER DELTA YOUTHPARLIAMENT

PLOT 4 ECORIUMCALABAR 0803 713 5230

36 ENGR. J.O. OJOSU DIRECTOR EPAENERGY COMMISSIONOF NIGERIA

PLOT 701C, CENTRALAREA,P.M.B 0805 618 1776 [email protected]

37ABDULKAREEMADESOKAN AGM Projects NERC

PLOT 1 099 1STAVENUE, P.M.B. 136ABUJA 0803 314 1466

38 SHITTU SHAIBU SNR. PROJECT NERC

PLOT 1 099 1STAVENUE, P.M.B. 136ABUJA 0805 802 5088 [email protected]

39


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(Annex) 1.2 Ibom Community Relations and Consultations on an Individual Generation Project

A number of generation subprojects, subject to successful due diligence reviews, could be supported by NEIP. These have reached advanced stages of preparation and even construction, and consultations have started with communities involved. One of the subprojects is Ibom Power, proposed by Ibom Power Company (IPC), and located in Akwa Ibom state. It consists of a gas-fired power plant and transmission line. IPC has conducted extensive consultations with local governments and community leaders and has developed a robust community relations mechanism and community development program. It is summarized here as an example of one seemingly effective approach to power plant development in the Niger Delta. The Community Development Program (CDP) by subproject sponsors IPC and its prime contractor, Group 5, includes:

• Upgrading and expanding the power distribution system in the district in which the plant is located, Ikot Abasi, so that more than half of the communities now have access to reliable electric service. IPC expects by the end of 2008 to have electrified the whole of the district.

• With the arrival of electricity, government was able to commission two water supply systems that had been built but never operated due to lack of power.

• IPC has worked with local and traditional governments to establish a steering committee that holds regular meetings to review community needs.

• IPC currently “employs” 25 to 30 recent college graduates who need a year of practical industrial experience.

• IPC is discussing with local banks a program in which IPC would provide technical and managerial backing for innovative small and medium industrial ideas, and banks would extend credit to the enterprises with that backing.

Other aspects of the CDP include employment programs for local people, local industry support programs, and other small and medium size enterprises. Arrangements for Community Relations, Communications, and Problem-solving: Group 5 has employed a Community Liaison Officer (CLO) who will be hired by IPC when the construction contract ends. At his recommendation, Group 5 hired a person from the community for each of the five clans to assist the CLO. These five people are the first line of communication to the company and the normal means of getting information out to the community. They are also the means of recruiting temporary workers for tasks such as clearing the transmission line ROW. The team installing the transmission line is obliged to give the CLO at least 24 hours notice prior to commencing work on a tower. The CLO informs the clans through his assistants of what is planned and the number of laborers that will be needed for clearing brush and other unskilled work. In addition to the hiring of laborers for ROW clearance and tower erection as described above, the majority of the workers employed at the plant site came from the clans. The Local communities formed the Ikot Abasi Industrial Relations Committee as a group that facilitates conflict resolution. This group was instrumental in dividing employment opportunities among the five clans. After they were notified by Group 5 of the numbers and skills required, the group would arrange for people to be screened by Group 5, and those found qualified would be hired and trained for work on the project.


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Grievances come to the CLO, who then attempts to resolve grievances, sometimes bringing in the village head to assist. When the CLO cannot resolve the grievance himself, he briefs Group 5 management, and seeks guidance.


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Annex 2. Cost Breakdown for ERSU in the NEIP Below is the estimated cost of running the ERSU, preparing the various safeguard documents (EIAs, EMPs Monitoring plans, RAPs), monitoring, audit activity, consultancy, procurement of monitoring vehicles, safety and other field equipment, stakeholder consultations, disclosure of safeguards documents and payment of compensations.

S/N Item Remark Cost (USD)1 Administrative

costs Procurement of office equipment, laptop computers, digital cameras with GPS device, scanners, GPS devices and GPS software, GIS software, procurement of maps, satellite images. 300,000

2 Consultancy EIAs for transmission lines (6) Site-specific EMPs (6) Environmental Audits (6) Total

600,000

150,000

600,000

1,350,0003 Operational and

Maintenance Cost Consultations with stakeholders, stakeholders sensitization workshops, meetings, fuelling and maintenance of field vehicles, community liaison, Monitoring and site inspection, audit inspections and production of reports, procurement of two (2no.) 4x4 monitoring vehicles. 750,000

4 Capacity building and Training for ERSU

Training on climate change and additional skills required to evaluate power generation.

200,0005 Capacity Building

and Training for GenCos, TCN and DisCos.

Training in EIA, Environmental Audit, and Environmental Management Workshops for ERSU staff in GenCos, TCN, IPPs and DisCos. 200,000

TOTAL US$ 2,500,000.00


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Annex 3. Safeguards Tables The tables below provide guide to determining which Bank safeguard policies are triggered. Table 5: Verification of Safeguards Policies triggered by subprojects Environmental Assessment (OP 4.01) Summary: The Bank requires environmental impact assessment (EIA) of sub-projects proposed for Bank financing to help ensure that they are environmentally sound and sustainable. The environmental assessment is a process that is conducted to identify the negative impacts that a project may have on aspects of the biophysical and social environment. It analyses the impacts of project alternatives, and provides mitigation measures to be undertaken to eliminate or minimize the impacts identified. Objective: To identify potential impacts that a project may have on the environment and to provide mitigation to eliminate or minimize these impacts. The subproject operator automatically complies with this policy by complying with the measures described in this ESMF. Preparation of EIAs including EMPs are required for Category A and B subprojects, and only an EMP is required for Category C subprojects.

Natural Habitat (OP 4.04) Summary: The conservation of natural habitats is essential for long-term sustainable development. The Bank supports, and expects subproject operators to apply, a precautionary approach to natural resource management to ensure opportunities for environmentally sustainable development. The Bank will not support subprojects that, in its opinion, involve the significant conversion or degradation of critical natural habitats. Objective: To ensure the protection, maintenance and rehabilitation of natural habitats and their functions within the financed subproject.

Questions: Actions: i) Will the subproject be located on lands that were converted from natural habitat in anticipation of the subproject?

If ‘yes’, and in the Bank’s opinion that site had been a significant habitat, the Bank will not support the subproject.

ii) Will the project be located on lands that require conversion of natural habitat?

If ‘yes’ and in the Bank’s opinion the natural habitat is not significant, the project may proceed. If ‘yes’, and the natural habitat is significant, proceed to question iii). If ‘no’, proceed with the subproject.

iii) On a site with significant natural habitat, are there feasible alternatives for the subproject?

If, ‘yes’ go to the feasible alternative. If ‘no’, go to question iv)

iv) Do the overall benefits of the subproject substantially outweigh the environmental costs?

If ‘yes’, the Bank may support the subproject. If the environmental and social impact assessment indicates that a project would significantly convert or degrade natural habitats, the subproject will include mitigation measures acceptable to the Bank and these could include minimizing habitat loss, and/or establishing and maintaining an ecologically similar protected area. Other forms of mitigation will be approved if they are technically feasible. If ‘no’, the Bank will not support the subproject.

Other comments: i) In deciding whether to support a subproject with potential impacts on a natural habitat, the Bank takes into account the operator’s and the Government’s ability to implement the appropriate conservation and mitigation measures. If there are potential institutional capacity problems, the subproject and overall NEIP includes activities that develop the capacity of national and local institutions for effective environmental and social planning and management.


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ii) The Bank expects the operator and the Government to take into account the views, roles and rights of interest groups including NGOs and local communities affected by the subproject. It expects that such interested parties be involved in the planning, design, implementing and evaluating of such subprojects.

Physical Cultural Resources (OP 4.11) Summary: Cultural property includes sites having archaeological (prehistoric), paleontological, historical, religious and unique natural values. The Bank will normally decline to finance a subproject that will significantly damage non-replicable cultural property, and will assist only those subprojects that are located or designed so as to prevent such damage. The policy pertains to any project/subproject in which the Bank is involved; irrespective of the whether the Bank is itself financing the part of the project that may affect cultural property. Objective: To assist in the preservation, and to seek to avoid elimination of cultural property.

Questions: Actions: i) Will the subproject damage or remove physical cultural property?

If ‘yes’, the operator must take appropriate action to meet the Bank requirements of cultural property protection. If the project benefits are great and the loss or damage of the cultural property is judged by competent authorities to be unavoidable, minor, or otherwise acceptable, the Bank may waive the policy. If significant damage to non-replicable cultural property is likely, the Bank will normally decline its support for the subproject.

Other comments: i) The Bank will assist in the protection and enhancement of cultural properties encountered in Bank-financed projects, rather than leaving their protection to chance. In some cases, the subproject is best relocated in order that sites and structures can be preserved, studied, and restored in situ. In other cases, structures can be relocated, preserved, studied, and restored on alternative sites. Often, scientific study, selective salvage, and museum preservation before destruction is all that is necessary. Such actions, including the necessary training and strengthening of the relevant institutions (e.g. local museum specialists) should be included in the scope of the subproject.


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Involuntary Resettlement (OP 4.12) Summary: Bank experience indicates that involuntary resettlement under development projects, if left unmitigated, often gives rise to severe economic, social and environmental risks: production systems are dismantled; people face impoverishment when their production assets or income sources are lost; people are relocated to environments where their productive skills may by less applicable and the competition for resources greater; community institutions and social networks are weakened; kin groups are dispersed; and cultural identity, traditional authority, and the potential for mutual help are diminished or lost. Where people are forced into resettling as a result of a Bank project or a component of the project that may be under other financial arrangements, the Bank requires that those who are affected are treated in such a way so as way as to minimize their disruption and to compensate for their losses. The borrower will be responsible for preparing, implementing, and monitoring a resettlement plan, a resettlement policy framework, or a process framework, as appropriate, that conforms to the policy. The NEIP is preparing a RPF which the operator is supposed to comply with should his subproject trigger this policy. Objective: Involuntary resettlement will be avoided where feasible, or minimized. Where resettlement is required, resettlement activities will be conceived and executed as sustainable development programs, providing sufficient investment resources to enable the persons displaced by the project to share in project benefits. Displaced persons should be assisted in their efforts to improve their livelihoods and standards of living or at least to restore them to levels prevailing prior to the beginning of project implementation.

Questions: Actions: i) Is there any land acquisition resettling in loss of access, restriction or denial of access to that acquired land? ii) Will the taking of land result in relocation or loss of shelter? iii) Will the taking of land result in a loss of assets or access to assets? iv) Will the taking of land result in the loss of income sources or means of livelihood?

If the answer to one or more of the questions is yes, then a resettlement action plan (RAP) consistent with the disclosed RPF is to be prepared by the operator. Depending upon the significance of the impacts (e.g. minor or less than 200 resettled) an abbreviated resettlement plan would be required only). The plans will ensure that: i) people are informed of the their options and rights pertaining to resettlement; ii) they are consulted and given feasible resettlement alternatives; iii) they are provided prompt and full compensation for losses incurred. If physical relocation is required the plan will: i) provide assistance during relocation; ii) be provided with housing, housing sites, or agricultural sites; iii) offered support after resettlement; iv) provided with development assistance, monitored and granted access to grievance redress mechanisms. Resettlement planning includes early screening, scoping of key issues, the choice of resettlement instrument, and the information required to prepare the resettlement component. To prepare the plan the borrower will draw upon appropriate social, technical, and legal expertise and on relevant community based organizations and NGOs.

Other comments: i) At the Government’s request the Bank may provide technical, legal and financial support for resettlement planning and for institutional capacity strengthening as this relates to resettlement planning and implementation. ii) The full cost of resettlement activities to achieve the objectives of the project is included in the total costs of the subproject to be paid for by the operator. iii) The borrower is responsible for adequate monitoring and evaluation of the activities set forth in the resettlement instrument (i.e. RAP).


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Annex 4. Contents of an EIA

The section below includes the minimum requirements for an environmental impact assessment (www.worldbank.org) (a) Executive summary. Concisely discusses significant findings and recommended actions. (b) Policy, legal, and administrative framework. Discusses the policy, legal, and administrative framework within which the EA is carried out. It is to explain the environmental requirement of any co-financiers. Identifies relevant international environmental agreements to which the country is a party. (c) Project description. Concisely describes the proposed project and its geographic, ecological, social, and temporal context, including any offsite investments that may be required (e.g., dedicated pipelines, access roads, power plants, water supply, housing, and raw material and product storage facilities). Indicates the need for any resettlement plan or indigenous peoples development plan2 (see also subpara. (h) & (v) below). Normally includes a map showing the project site and the project’s area of influence. (d) Baseline data. Assesses the dimensions of the study area and describes relevant physical, biological, and socioeconomic conditions, including any changes anticipated before the project commences. Also takes into account current and proposed development activities within the project area but not directly connected to the project. Data should be relevant to decisions about project location, design, operation, or mitigation measures. The section indicates the accuracy, reliability, and sources of the data. (e) Environmental impacts. Predicts and assesses the project’s likely positive and negative impacts, in quantitative terms to the extent possible. Identifies mitigation measures and any residual negative impacts that cannot be mitigated. Explores opportunities for environmental enhancement. Identifies and estimates the extent and quality of available data, key data gaps, and uncertainties associated with predictions, and specifies topics that do not require further attention. (f) Analysis of alternatives.3 Systematically compares feasible alternatives to the proposed project site, technology, design, and operation--including the "without project" situation--in terms of their potential environmental impacts; the feasibility of mitigating these impacts; their capital and recurrent costs; their suitability under local conditions; and their institutional, training, and monitoring requirements. For each of the alternatives, quantifies the environmental impacts to the extent possible, and attaches economic values where feasible. States the basis for selecting the particular project design proposed and justifies recommended emission levels and approaches to pollution prevention and abatement. (g) Environmental management plan (EMP). Covers mitigation measures, monitoring, and institutional strengthening; see outline in OP 4.01, Annex C.

(h) Appendixes (i) List of EA report preparers--individuals and organizations.


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(ii) References--written materials both published and unpublished, used in study preparation. (iii) Record of interagency and consultation meetings, including consultations for obtaining the informed views of the affected people and local nongovernmental organizations (NGOs). The record specifies any means other than consultations (e.g., surveys) that were used to obtain the views of affected groups and local NGOs. (iv) Tables presenting the relevant data referred to or summarized in the main text. (v) List of associated reports (e.g., resettlement plan or indigenous people’s development plan).


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Annex 5. Guidelines for the preparation of EMP The preparation of an EMP should include the following key sections (see also www.worldbank.org):

1. Summary of Impacts:Anticipated adverse environmental impacts should be identified and summarized as well as their relationship to social impacts and the appropriate mitigation measures.

2. Description of Mitigation measures:The mitigation measures proposed for the various

impacts should be described in relation to the corresponding impacts while stating the conditions under which they are required. Adequate description of the consultations should be done and justified.

3. Description of monitoring program:A detailed monitoring program should be described

in the EMP, listing environmental performance indicators and their link with impacts and mitigation measures. The EMP should also describe the parameters to be measured, methods to be used, sampling location and frequency of measurements, detection limits and a clear definition of thresholds that indicate the need for corrective measures. Monitoring and supervision schedules should be clearly stated and agreed with the Bank to ensure timely detection of needs for remedial action and also provide information on the level of compliance with EMP in accordance with Bank safeguards. These arrangements must be clearly stated in the project implementation/operations manual to reinforce project supervision.

4. Legal requirements and bidding/contract documents: The EMP should be incorporated in

all legal documents to enforce compliance by all contractors participating in the project. The EMP should be summarized and incorporated in the bidding and contract documents.

5. Institutional arrangements: The EMP should clearly state who is responsible for

monitoring, execution of remedial action and the reporting order and format to allow for a defined channel of information flow. It should also recommend institutional strengthening for relevant agencies and the funding authorities for the various activities.

6. Capacity Development and Training: To support timely and effective implementation of

environmental project components and mitigation measures, the EMP draws on the EA’s assessment of the existence, role, and capability of environmental units on site or at the agency and ministry level.3 If necessary, the EMP recommends the establishment or expansion of such units, and the training of staff, to allow implementation of EA recommendations. Specifically, the EMP provides a specific description of institutional arrangements i.e. who is responsible for carrying out the mitigation and monitoring measures (e.g., for operation, supervision, enforcement, monitoring of implementation, remedial action, financing, reporting, and staff training). To strengthen environmental management capability in the agencies responsible for implementation, most EMPs cover one or more of the following additional topics: (a) technical assistance programs, (b) procurement of equipment and supplies, and (c) organizational changes.

7. Implementation Schedule: The frequency, timing and duration of mitigation measures

and monitoring should be stated in the implementation schedule. Links between


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mitigation measures and development of relevant institutions and legal requirements of the project should be stated.

8. Reporting: The order of information flow as it concerns monitoring reports should be

clearly defined. The relevant officers to receive these reports should be those who have authorities to facilitate implementation of the results of the monitoring. These reports should also be communicated to the Bank via media to be agreed and specified in the EMP. Adequate arrangements should be made by the Bank to facilitate the circulation of the EMP through the selected means.

9. Cost estimate: The cost of carrying out monitoring and implementation of the mitigation

measures at the various stages of the project should be integrated into the total cost of the project and factored into financial negotiations. These costs should include administrative, design and consultancy, operational and maintenance costs – resulting with meeting required standards and project design.

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