International and Local Perspectives to Development in Russia: A Consultant's View

Scott Polar Research Institute, Cambridge University20 March 2006

Charles Haine, Royal Haskoning

Scott Polar Research Institute, Cambridge University20th March 2005

Scott Polar Research Institute, Cambridge University20th March 2005

Scott Polar Research Institute, Cambridge University20th March 2005

Scott Polar Research Institute, Cambridge University20th March 2005

Topics covered

Images and examples (Sakhalin Island)

Experience in Russian Federation

Environmental Impacts:

- For ‘Approval’ and permitting

- International perspective

- Island’s receptors’ perspective

Integrating diverse issues into development

(A consultant’s view)

Profile

Consultants, scientists and engineers3,000 professionalsEstablished in 1881Worldwide experienceIndependent and professional

Yuzhno-Sakhalinsk

Haskoning Sakhalin OOO

60 professionals

Established in 2003

Local expertise; Globalnetwork

Oil and Gas track recordClients:

Shell (The Netherlands, Belgium, Gabon, Egypt, Sakhalin, Nigeria, Latin America, UK)Petroplus (UK)Vopak (Netherlands)ConocoPhillipsTotalAgipCentrica / StatoilBGBP International Experience:

Netherlands, Belgium, France, Nigeria, GabonRussian Federation, Latin America and ArabianGulf

Oil and Gas: HSE services

• HSE Management

• Impact Assessment (EIA, SIA, HIA)

• Safety (QRA, Safety Cases)

• Permitting/Approvals

• HSE Contractor Management

• Monitoring and Measurement

• Audits, Verifications, Due Diligence Assessments,

• Site investigation and Remediation

• Environmental technology (Waste/ Water/Energy/Noise)

• Sustainable Development

• External Affairs / HSE & SD Reporting

Sakhalin Energy Phase 2

• Royal Haskoning – ISP Contract

Source: SEIC 2004

Sakhalin Energy Phase II

An integrated oil and gas development$20bn investment Two new offshore platforms1,000 km onshore oil and gas pipelinesFirst LNG plant in RussiaLargest single LNG trains ever built (9.6Mtpa)First Russian gas to Asia

Source: SEIC 2004

Project specifications

Fields contain recoverable hydrocarbon volumes of >1 bn barrels crude oil and >500 bn m3 natural gas. Enough to supply current global LNG demand for four years.

Source: SEIC 2004

Climate and Environment

Source: SEIC 2001, 2002, 2004 and 2005

Natural Beauty and Resource Base

Ecological Diversity

Source: SEIC and various 2004

Habitat Diversity

Wetlands Crossing Site, Spring 2005

Source: SEIC 2004

River Crossing Site, Winter 2006

Source: SEIC 2004

Lenders / Approvals Perspectives

Protection of Western gray whaleSteller’s Sea-eagle and RDB speciesRivers and wetlands’crossingsSolid waste managementAir qualityOSRHealth and Safety

Source: WWF, SEIC

International Media Perspectives

Source: SEIC, FoE, EBRD 2004

International Media Perspectives

Source: WWF, SEIC

On-Island Community Perspectives

Source: SEIC, SEW 2001-2005

On-Island Community Perspectives

Source: SEIC

On-Island Community Perspectives

Source: SEIC

Consultants’ Perspectives

• Pipelines through wetlands

• River crossings’strategy

• Red data bird species

• Land management• Biodiversity• Non-WGW marine

mammals• Benthos (dredging

Aniva Bay)• Protected areas• Commercial

fisheries

• Beach landing facility, OPF

• Air quality, noise & groundwater

• Steller’s Sea-eagle

• Road safety

• Solid waste management

• Oil spill response

• Geohazards and seismicity

• Occupational hygiene and safety

• Major design changes

Dual Approach

Fundamental differences between Russian environmental approval and international environmental decision-making processes that cannot be fully resolved through application of goal-setting standards

Leading to:Risk of misalignment between decision-making processesDifficulty in providing HSE assurance for decisions taken at each stage of major capital projectsUncertainty regarding HSE compliance during execution of each stage of major capital projects

RF EIA Processes in Project Execution

APPROVAL PROCESS

MAIN STAGES

Declaration of Intent

TEO of Investments

(TEO-I)

TEO for Construction(TEO-C)

Detailed design

documentation

TEO-I incl. EIA Report

State Environmental

ExpertReview (SEER)

Pre-approval by regional approval

agencies

TEO-C incl. Environmental

Protection section

Pre-approval by regional approval

agencies

SEER

PROJECT DEVELOPM

ENT STAGES

DOCUMENTS TO BE SUBMITTED

ENVIRONMENTALREVIEW AND OUTCOME

Document on environmental

features (e.g. water, energy, wastewater,

waste, land)TEO-C incl. EIA Report

Screening decision by

regional/local authorities

Figure 1 MAIN STAGES OF RUSSIAN FEDERATION EIA APPROVAL PROCESS

Public Consultation in Practice

Russian FederationTwo-stages: TEO-I and TEO-C.Restricted to single public hearings on EIAsLargely restricted to the affected population within boundaries of the project area.

International EIALarger aspect of the EIA processUndertaken throughout the project cyclePublic hearings, interviewing and questionnaires/surveys, use of media (e.g. adverts), printed materials (e.g. newsletters) and information sessions/roadshows.Includes interest groups (e.g. NGO’s, academic) ESPOO Convention (1997) – transboundary impacts‘Spirit’ of international approach captured in the Aarhus Convention (1998).

Integrating Issues into Development

e.g. for TNK-BP

Strategy analysis of international vs. RF approaches to EIA Environmental Management in Major Capital ProjectsProject Environmental Management Categorization

e.g. Shell Global Solutions

HEMP approach to EIA (Nigeria)

Potential Project EM Models

A

BI

BL

C

GrI

GrL

BrI

BrL

MxI

MxL

IL

InL

International +

International

Local

PrincipalEnv

Standards

EnvStandards

EnvStandards

PROCESSES

STA

ND

AR

DS

Sakhalin: Environmental Survey Work

Source: SEIC

Project Evolution and Progress

Source: SEIC

Progress

Source: SEIC

Conclusions

Professional: independent / big picture thinking

Lender involvement

Awareness of local v. international perspectives

Public participation and knowledge changing rapidly

The way forward

Thank You