EIA Process for WAGP Project: Concerns over Compliance with Policies and Applicable National Regulations

EIA Process for WAGP Project: Concerns over Compliance with the World

Bank’s Social and Environmental Safeguard Policies and Applicable National Regulations in Nigeria.

Background

The West African Gas Pipeline (WAGP) is a gas pipeline project which will transport natural gas from Nigeria to Benin, Togo and Ghana. The gas will be delivered from Nigeria via a 678 kilometers pipeline across southwestern Nigeria to a terminal point in Takoradi, Ghana. In Nigeria, fifty-eight (58) kilometers of pipelines and other ancillary facilities are placed on the land of twenty three (23) communities in southwestern Nigeria.

The West African Gas Pipeline Company Limited (WAPCo) is the project proponent. The current shareholders of the special purpose company (WAPCo) include Shell, Chevron, Nigerian National Petroleum Corporation (NNPC), Volta River Authorities (VRA) of Ghana, BenGaz of Benin, and SotoGaz of Togo.

The entire cost of WAGP project is about US $590 million. The World Bank is supporting the project with a US $50 million guarantee through the International Development Association (IDA) for certain obligations of the Republic of Ghana relating to the purchase of natural gas. There is also a guarantee to WAPCo, in the amount of US $75million, from the Multilateral Investment Guarantee Agency (MIGA) for political risk in relation to the construction of the pipeline and associated facilities.

The Nigerian corporate shareholders in WAPCo (i.e. Shell, Chevron and NNPC) have a deep-rooted culture of using lies, misinformation and corruption as routine management procedures in running their businesses in Nigeria.

These companies would violate environmental laws with impunity. This is because government enforcement powers are either at their lowest point or non-existent, giving them a leeway to exploit the lax regulatory regime. More worryingly, the personnel of the government regulatory authorities are content with using the regulations as a major leverage towards personal enrichment.

The Flawed Environmental Impact Assessment (EIA) Process for WAGP

The flawed EIA process for the on-going WAGP is not an isolated case. It is a confirmation of the EIA practice in Nigeria, which is characterised by corruption and infraction of environmental legislation and regulations. More often than not, the regulatory authorities aid and abet the multinationals to violate the regulations.

However, the Requesters in Nigeria relied on the transparent administrative mechanism within the World Bank to make their Requests bordering on the flawed EIA process for WAGP to the Bank. In response to the Requests, the World Bank’s Management stated that the project meets the applicable Bank’s social and environmental safeguard requirements. It however admitted that further work will be needed on safeguards supervision.

Consequently, the Inspection Panel set up by the World Bank’s Board recommended an investigation in light of conflicting assertions of Requesters and the Bank over issues such as lack of supervision of the project in compliance with the Bank’s policies and procedures, damage to fishing nets in the Badagry area, inappropriate valuation of assets and procedures for compensations, inadequate disclosure of information on the project, among others.

The findings of the Inspection Panel submitted to the World Bank in August 2008 contended that the global bank failed to comply with its own policies and procedures on social and environmental assessment and project supervision in respect of WAGP project.

The investigation carried out by the inspection panel headed by Mr.Warner Kiene:

a) Identified systemic weaknesses in the management and supervision of the project, leading to non-compliance with the World Bank’s key social and environmental policies.

b) Found that the project did not provide mitigations for impacts arising from involuntary resettlement of people, including adequate compensation for irreparable harm to the communities’ livelihoods.

c) Found significant under-compensation for the value of acquired land, which was calculated at below market rates.

d) Found that the project proponent provided imprecise information, suggesting more reduction in gas flaring than the project could technically deliver.

e) Found inadequate and misleading information disclosure on the project.

On the issue of damage caused to fisher folk nets in the Badagry area by indiscriminate release of bentonite into the coastal waters during pipeline construction, as contained in a report by the author of this piece (Tayo Akeem Yusuf); the inspection panel erroneously dismissed it as lacking scientific foundation. The report revealed that the fishing nets in the affected area were coated with bentonite used during pipeline construction, rendering them unfit for fish catch.

During the inspection visit, the panel made a wrong prejudgment that ‘lack of information’ regarding the compensation issues in the earlier requests for inspection necessitated the desperation to push the report on damage caused to fishing nets by the requesters. In an apparent disregard for the scientific attitudes of objectivity, open-mindedness and critical – mindedness; the panel was not in a good mood to inspect and / or collect the damaged nets to ascertain the cause of the damage in a scientific manner.

The World Bank’s responsibility is not only to act in compliance with the Bank’s social and environmental safeguard policies in respect of a project supported by it, but also to ensure that the relevant local laws and regulations are followed by the project proponent(s).

The WAGP component in Nigeria was purportedly approved under the EIA Act No. 86 of 1992. Worryingly, the EIA practice in Nigeria is characterised by corruption and infraction of regulations. The on – going EIA process for the WAGP project is not an exception.

The aspect of the EIA process which preceded the WAGP approval breached the EIA Act in the following respects:

i) The EIA report contains misinformation and inappropriate disclosure of information relating to assessment of social and environmental impacts and mitigations. This is also admitted in the investigation report of the inspection panel set up by the World Bank’s board.

ii) The assessment of the EIA report by the review panel was carried out behind a veil of secrecy

to the extent that the host communities and the interested members of the public were not given an opportunity to participate in the assessment as required by the EIA Act. Also, the review panel for WAGP did not produce any report on its own as statutorily required. Hence, there was no valid review panel’s report to publish and / or act upon by the regulatory authorities to warrant any forms of approval for the WAGP project in Nigeria.

iii) The WAGP project was purportedly approved under the Nigerian EIA Act in 2004. Yet, the statutory requirement placed on the regulator to publish the approval in any manner by which members of the public and persons interested in WAGP shall be notified has not been observed in compliance uptil and including today.

Another major problem with EIA process in Nigeria is the implementation of post-authorisation activities contained in the environmental management plan (EMP) for the project. The Nigerian EIA Act No. 86 of 1992 recognises the EMP as a follow-up programme. Section 63 of the EIA Act states:

“…. ‘Follow-up program’ means a program for:

a) verifying the accuracy of the environmental assessment of a project, and

b) determining the effectiveness of any measures taken to mitigate the adverse environmental effects of the project …..”

The follow-up program is implemented through environmental monitoring scheme and auditing.

The assertion by the Bank’s Management that an EMP is in place for the project is not a convincing proof that it (the EMP) will be implemented according to recognised standards at the operational and abandonment phases of the project.

The three Nigerian corporate partners in WAPCo have been benefiting from the Nigerian non- transparent administrative mechanism on the one hand and lack of procedure for ensuring disclosure of records relating to environmental assessment on the other hand, to violate this aspect of the EIA process.

It is not enough to have an EMP for WAGP. It is more important for the World Bank to ensure implementation of the EMP in accordance with the applicable Bank’s safeguard policies and relevant local regulations in Nigeria.

On safety issues, the purported system – wide and site-specific emergency response plans for WAGP are a mere smokescreen to make it appear that proven emergency response plans are in place for the project. The current practices in Nigeria are at odds with relevant regulations, which require involvement of local citizens in the risk zone of hazardous installations in the development, testing and implementation of the overall response plan for the accidents and emergencies associated with these hazardous installations. We are not aware of any proven emergency response plans for WAGP even as the facility has begun test-running.

Conclusions

The World Bank’s Management had earlier given an assurance that it was acting in compliance with applicable environmental and social safeguard policies in respect of WAGP. However, the investigation report of the inspection panel submitted to the Bank’s board in August 2008 revealed that the Bank’s Management failed in this respect owing to the absence of appropriate supervision.

In the light of the foregoing, particularly in relation to the failure of the World Bank’s Management to discharge its duty of safeguards supervision at the stages of the EIA process preceding the WAGP authorisation; and the fact that WAGP was approved in notorious breach of the Nigerian EIA Act No. 86 of 1992. There is a great concern over the capability of the World Bank to act in compliance with its Safeguard Policies and Local Regulations in Nigeria with regard to implementing post- authorisation activities (EMP and emergency preparedness plans) for WAGP.

Would the World Bank again treat the post-authorisation activities aimed at protecting the environment, public health and property as subordinate to the selfish interest of the WAGP proponents?

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