In response to the recently leaked Impact Assessment report, Wordsworth would like to issue a statement that the company was working with the government to publicly release this information but was prohibited from doing so. The company has decided to publish these findings in an effort to promote transparency and we welcome any inquiries from the public.
Odiham Associates Ltd.
Dedicated to excellence in Environmental and Social Impact Assessment since 1993
Preliminary Environmental and Social Impact AssessmentBlock 45 Development, Central Thibaw
Executive Summary
• The very significant revenues the project will generate could be a source of internalconflict and dissension in Thibaw if not well employed. Used well however, theycould stimulate trade and commerce in the non-oil sector and could allow majorupgrades of education, health-care and infrastructure. The main features of anyresponsible scheme for revenue utilization should be:
(a) Transparent and externally auditable public reporting of all revenues;(b) Agreement at Government level of the division of revenues betweenNational, State and Local Governments, including special provision forthe oil producing areas;(c) Clear commitments as to what percentages of the revenues would bespent on education, health and stimulation of industry and agriculture.;(d) The “Oil Fund” set up in Norway is a good example of how a countrycould manage its revenues for long term good.
• Wordsworth Oil obviously cannot dictate to the Thibawan Government how to useits revenues, but some independent third-party, typically governmental or super-governmental, might usefully be involved by Wordsworth in dialogue with theThibawan Government on this topic.
• Many of the skills needed for development of an oil industry are already presentin Thibaw, though not in the remote Block 45 area. Early action is needed to firmup requirements and to develop a plan for recruitment and training to maximizeopportunities in this sector. There are also significant numbers of Thibawans livingoverseas who have relevant skills – every effort should be made by Wordsworth todevise packages which would entice them to return.
• Subject to further detailed assessment (see below) there are unlikely to besignificant resettlement concerns associated with the development. Block 45 is ina sparsely populated area and deviated drilling from well clusters can minimizethe ground-usage required and ensure that villagers are not disturbed. (Notehowever that the issue of encroachment post-construction does however have to beanticipated). The pipeline route envisaged does however come close to settlementsand care must be taken in detailed planning to avoid them.
• It should be noted that the Block 45 area is commercially and industriallyundeveloped. There is only a very limited cash-economy and people are not usedto dealing with ready money. Cash compensation for any reason, though wellmeant, may have unintended consequences in terms of social destabilization(including local inflation, boom-town effects etc.) and may indeed trigger inter-communal tensions. The protests of villagers of Sudat, who were not affected in therecent waste-pit spill incident, but who demanded to be compensated anyway, isan example of the type of concerns that will need very careful management in thecoming period. Where possible compensation and community involvement shouldbe in-kind, or via community-development projects which genuinely reflect localneeds, identified in close consultation with the local people themselves. Wordsworthis strongly recommended to investigate how third-party experts in this field (e.g.development agencies or NGOs) can assist them to do this.
Note that though HIV/AIDS is a major concern in other parts of Thibaw the incidencein the Block 45 area is still very low. Wordsworth needs to identify a strategy assoon as possible to ensure that its operations are planned and executed to ensurethis persists.
• There are significant but not necessarily insuperable ecological and bio-diversityconcerns associated with the Lai-Ha Valley pipeline route. The rare Dwarf Tapir hasits last habitat here and is possibly being kept from total extinction by the fact that,other than the road from Sagu to Viet Nam, the roads in the area are in a very poorstate of repair, thus limiting access for poachers. There are indications that the armyis actively engaged in hunting of these animals for their hooves, which command ahigh price in certain overseas markets as aphrodisiacs, as well as in illegal loggingin the southern parts of the valley, on the northern foothills of the Pauk Mountains.(These facts have led “The Global Nature Institute” in the USA designating the Lai-Ha Valley to the one of its “200 Most Endangered Eco-Regions”). Were Wordsworthto pursue this route for the pipeline it would need to agree enforceable protectionmeasures for the Dwarf Tapirs with the Government. One solution could be to agreethat all road upgrades and access created for pipeline construction purposes wouldbe temporary and demolished after the pipeline is commissioned, so that the arearemains inaccessible.
• Agitation is currently developing internationally to declare large areas of the PaukMountains as protected areas in view of the presence of endangered species. Thisdemand has many eminent supporters and is likely to grow in the future but it isunlikely that the Thibawan Government will take any notice,
• Should the development of Block 45 proceed on the basis of flaring of all excessassociated-gas, then it will detract significantly from the overall environmentalfriendliness of the project. Though the contribution to Global Carbon Dioxide (CO2)
levels would be small in absolute terms, it would be very considerable in relativeterms for Thibaw, which, not being industrialized, has low emissions at present.Given that Wordsworth elsewhere has made strenuous efforts to reduce CO2emissions in its operations, implementation of flaring in Thibaw would be a highlyretrograde step. It therefore essential to continue evaluating schemes for managingexcess gas.
• Odiham Associates recommend that Wordsworth Oil establish an early relationshipwith some independent third-party entity with expertise in tropical ecology andbiodiversity which can act as a sounding board and critic for Wordsworth thinkingon this topic. A similar alliance with an entity with expertise in social and economicdevelopment would be appropriate.
• Execution of this Impact Assessment was an obligation for Wordsworth under theThibawan Hydrocarbon Law and as such it must be shared with the Government.In addition however thought should also be given as to with what other entities thisImpact Assessment should be shared, and how much there is to be gained fromtransparency as to its findings.
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