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Environmental & Social Impact Assessment (ESIA) of Asia Energys Phulbari Coal Project Chapter 3 of Volume 1

Final ReportApril 2006

Methodology Page - 3-i

TABLE OF CONTENTS

3 METHODOLOGY........................................ ................................................................. .............. 3-13.1 STUDY METHODOLOGY............................................................................................... 3-1

3.1.1 Introduction........................................................................................................3-13.1.2 Pre-feasibility and Screening..............................................................................3-33.1.3 Project Scoping..................................................................................................3-33.1.4 Consultation.......................................................................................................3-43.1.5 Legislative Review.............................................................................................3-43.1.6 Baseline Studies................................................................................................3-53.1.7 Analysis of Alternatives......................................................................................3-73.1.8 Impact Assessment............................................................................................3-73.1.9 Formulation of Mitigation and Management Strategies......................................3-93.1.10 Risk Analysis....................................................................................................3-103.1.11 Submission of IEE and EIA to GoB..................................................................3-10

3.2 STATUS OF PROJECT STUDIES................................................................................ 3-103.3 STUDY LIMITATIONS................................................................................................... 3-11Appendix 3.1: The Study Team .......................................................... .........................................1

LIST OF FIGURES

Figure 3.1: Project ESIA Evaluation Process.........................................................................................3-2LIST OF TABLES

Table 3.1: Reference Studies................................................................................................................3-5Table 3.2: Government and Multilateral Agency Sources......................................................................3-5Table 3.3: ESIA Technical Studies ........................................................................................................3-6Table 3.4: Residual Impact Likelihood Ranking.....................................................................................3-8Table 3.5: Significance Assessment Matrix...........................................................................................3-8

TABLEOFCONTENTS


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Methodology Page - 3-1

3 METHODOLOGY

3.1 STUDY METHODOLOGY

3.1.1 Introduction

This ESIA evaluates the interaction of the mine with the ecosystem and the community. The ESIAStudy Team has followed worlds best practice methodologies including the guidance provided by theEquator Principles (2002), IFC Operational Policy 4.01 (Environmental Assessment) (1998i), and theWorld Banks Environmental Assessment Sourcebook (1991a).

Asia Energy has committed to developing, operating, decommissioning and rehabilitating the PhulbariCoal Mine in accordance with the Equator Principles and international mine best practice standards.Accordingly, the ESIA has been undertaken over a 14 month period to enable environment field studiesand facilitation of community and stakeholder consultation activities. During this period, the ESIA studyteam (the Study Team) has also contributed to mine planning and design by identifying and advising onenvironmental and social constraints of the Project design and operational alternatives.

A key objective of the ESIA is to address recognised sustainability issues relating to natural resourcesand protection of environmental qualities. Guiding principles are:

The Precautionary Principle. The precautionary principle states that if there are threats ofserious or irreversible environmental damage, lack of full scientific certainty should not be usedas a reason for postponing measures to prevent environmental degradation.

Inter-generational Equity: The principle of inter-generational equity is that the presentgeneration should ensure that the health, diversity and productivity of the environment ismaintained or enhanced for the benefit of future generations.

Conservation of Biological Diversity and Ecological Integrity: The premise of this principle isthat the natural environment provides the basic elements of all life on earth and thus,maintaining biodiversity and ecological integrity is important for both anthropogenic andanthropocentric reasons. The protection of biodiversity and maintenance of ecologicalprocesses and systems are central goals of ecologically sustainable development.

Improved Valuation and Pricing of Environmental Resources: A central notion of sustainabledevelopment is that the total stock of resources should be carefully managed to maximise thewelfare of society now and for all future generations, by addressing the inadequacies inherentin market pricing mechanisms.

The Study Team was comprised of a number of local and international ESIA and technical disciplinaryspecialists. Due to Bangladeshs limited experience in the mining industry, and open cut mining inparticular, international specialists with expertise in assessing open cut mine developments and relatedenvironmental and socio-economic issues were engaged to guide the ESIA process. The Study Teamwas also responsible for developing, organising and undertaking the necessary environmental andsocial baseline studies. Recognised peer reviewers were engaged to test the robustness ofmethodology and conclusions of key technical studies. The Project Study Team is given inAppendix3.1.

Figure 3.1indicates the steps that have been undertaken during the ESIA evaluation process for theProject.

METHO

DOLOGY


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3.1.2 Pre-feasibility and Screening

Pre-feasibility studies for the Phulbari Coal Project (the Project) were undertaken by Asia Energy(GeoEng 1999). Following confirmation of Project feasibility, Project screening, involving considerationof Government of Bangladesh (GoB) legislative requirements, and the policies of the major financial

lending institutions (contained within the Equator Principles (2002)), confirmed that an Environmentaland Social Impact Assessment (ESIA) must be undertaken. Further screening indicated that the Projectwould be considered category Red1for the purposes of environmental assessment for the GoB andCategory A2according to the Equator Principles. For each category, the respective approving body hasissued specific guidelines that stipulate the required content of an ESIA. As indicated in Chapter 2, thisESIA has been prepared in accordance with those guidelines.

3.1.3 Project Scoping

The aim of the scoping study was to gather information on the current status of Project planning anddesign, make a preliminary assessment of the Projects area of influence, ascertain key environmental

and social aspects and receptors, and identify key potential impacts and gaps in knowledge.

As compliance with GoB legislation and policy is a requirement under the Equator Principles, the ESIAprocess has been broken into three chronological phases:

preparation of an Initial Environmental Examination (IEE) as per GoB requirements;

preparation of an Environmental Impact Assessment (EIA) as per GoB requirements; and

preparation of an ESIA to Equator Principle standards.

The scope of the first two phases only considered the mine development and operation, including

infrastructure development, road and rail deviations, mine pit excavation, coal extraction andprocessing, overburden dumping and rehabilitation.

Ancillary requirements to the mining operation (coal transport routes and infrastructure) requiresignificant GoB involvement and operational management, and are largely outside the direct control ofAsia Energy. As a result, it was decided that these aspects would not be included in the assessmentprocess until the first two phases were complete. Instead, options for coal transport routes andinfrastructure were identified in the EIA and preliminary environmental and social impact assessmentsincluded in this ESIA (Chapter 11). An ESIA for coal transportation is being prepared separately.

The Terms of Reference of the ESIA included the following key components:

managing consultation with relevant government stakeholders, NGOs, and Project-affectedpeople;

identifying the Projects area of influence and relevant environmental and social aspects;

gathering and evaluating available baseline information;

designing, implementing and undertaking monitoring studies;

identifying environmental and social constraints to Project development;

identifying and assessing the likely environmental and social impacts of the Project.Evaluation included direct, indirect and cumulative impacts;

designing mitigation and management measures to minimise potential impacts;

1Projects identified as having potentially significant environmental issues. According to the Environment Conservation Rules1997, all mining activities are classified as category Red.2Projects that are likely to have significant adverse environmental impacts that are sensitive, diverse, or unprecedented.


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identifying opportunities to enhance beneficial impacts of Project development, and improvesocial development opportunities; and

developing environmental and social monitoring programmes to evaluate the effectiveness ofmitigation measures.

3.1.4 Consultation

Consultation with government agencies and community representatives commenced in August 2004and continued throughout compilation of the ESIA. The challenging task of stakeholder communicationwas based on informed public participation and information dissemination, as outlined in the World BankUpdate No. 26, Environmental Assessment Handbook (1999). During preparation of the ESIA,community consultation took the form of:

distribution of several community information sheets and a Project brochure in Bangla toUpazila union officials and community members;

meetings with government and the eight Union Parishads located in Asia Energys licenceareas;

detailed discussion with NGOs;

opening of an Information Centre in the main street of Phulbari Township;

briefings with community groups by means of aggregated village workshops;

focus group discussions and individual case studies with particular categories of Project-affected people; and

demographic; resettlement, town planning and health surveys.

Concerns and suggestions raised by stakeholders have been considered during the Project planningand ESIA preparation process, and where possible tailored mitigation and management measures havebeen developed.

A wide range of Upazila Government officials, departments and community representatives have beenconsulted since August 2004. Consulted stakeholders and villages are identified in the PublicConsultation and Development Plan (PCDP), provided at Volume 4, Section 1 of this ESIA.

Consultation will continue as an ongoing process and will form a key part of design, development,implementation and operation of the Project. The future strategy for consultation and informationdisclosure is also identified in the PCDP.

3.1.5 Legislative Review

A review of GoB and international legislation, policies and guidelines was undertaken and included:

national legislation and policies;

international conventions to which Bangladesh is a signatory; and

Equator Principles policies and guidelines.

The review was conducted in two phases. The first phase identified the legislation, policies andguidelines to which the Project must conform. This information was used during the alternativesanalysis process to ensure that Project design and planned operations fit within the GoB and

international legislative and policy framework. The second phase (detailed in Chapter 2) assessed thepreferred Project planning, design and operation options against national and internationalrequirements.


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3.1.6 Baseline Studies

Following a review of GoB EIA Guidelines (Department of Environment (DoE), 1997) and consultationwith the DoE, detailed baseline investigations were undertaken within an area incorporated by a 10kilometre radius from the centre of the Deposit (as determined in August 2004). Groundwater, surface

water, biodiversity and social-economic studies occurred over a wider area to provide sufficientlycomprehensive baseline information and impact prediction

i. Review of Secondary DataAvailable secondary information was sourced through consultation with government departments,academic institutions, NGOs and other relevant stakeholders. Secondary data on geology, climate,environment and water resources for the Phulbari area was mainly collected from private sector studies(Table 3.1).

Table 3.1: Reference Studies

References

Ahmed (1994); Korea North-North Cooperation Corporation (2000);

BHP (1995a-b, 1998a-b); Mott Macdonald and Partners (1982);

British Geological Survey & Department of Public HealthEngineering (2001);

GeoEng International Pty Ltd (1999; 2000a-d; 2001a-b)(site-specific studies commissioned by Asia Energy);

Mott Macdonald International et al (1993);

Sir M Macdonald & Partners & Hunting TechnicalServices (1980); and

Wardell Armstrong (1991).

Regional secondary data was also collected from the following government and multilateral agencysources (Table 3.2).

Table 3.2: Government and Multil ateral Agency Sources

Agency

Department of Environment (DoE); Department of Education;

Department of Forestry; Rural Electrification Board (REB);

Department of Fisheries; Department of Agricultural Extension (DAE);

Water Resources Planning Organisation (WARPO); Bangladesh Bureau of Statistics (BBS);

Department of Public Health Engineering (DPHE); Local Government Engineering Department (LGED);

Public Works Department (PWD); Roads and Highways Department (RHD);

Bangladesh Water Development Board (BWDB); Bangladesh Power Development Board (BPDB);

Bangladesh Rural Development Board (BRDB); World Bank;

Bangladesh Meteorology Department (BMetD); Asian Development Bank (ADB);

Power Grid Company of Bangladesh (PGCB); International Finance Corporation (IFC); and

Gas Transmission Company Ltd (GTCL); Other financing, funding and research organisations suchas the Department of International Development (DFID),the Bangladesh Institute of Development Studies (BIDS)and CARE.


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ii . Primary Data and Field SurveysTo comprehensively evaluate existing baseline conditions, a monitoring and data collection programmeincorporating a number of biophysical and social investigations was developed and implemented. Themethodology used to develop individual studies is contained within the various technical reportsappended in Volumes 2 to 4 of this report. Primary data studies given in Table 3.3 have beencompleted and results summarised in Chapters 7 and 8.

Table 3.3: ESIA Technical Studies

Study Comment

Coal resource evaluation Geophysical surveys and drilling assessed coal reserves and site-specific geological data.

Hydrogeological survey This survey provided an assessment of the hydrogeological regime and methods for groundwatercontrol. Water level data collection commenced in July 2004 and continues weekly. Groundwatersamples were collected every two months over a 12 month period at 14 sites for detailed waterchemistry analysis.

Arsenic in groundwater This study examined the occurrence of arsenic in groundwater from 64 locations within a 20 kilometreradius of the Deposit.

Surface water survey Water levels have been measured at nine staff gauges on various watercourses and beels since August2004. An additional nine gauges were installed in May 2005. Two automatic water level recorders havealso been installed. Water samples were collected monthly over a 12 month period from 14 locationsfor chemical analysis. Flood modelling has also been carried out.

Climatological surveys A manually operated weather station has been operating in Phulbari since September 2001 measuringdaily temperature, humidity and rainfall. Two automatic weather stations were installed in November2004 for measurement of temperature, wind speed and direction, barometric pressure, total and netsolar radiation, relative humidity and rainfall.

Air quality monitoring Air monitoring commenced in November 2004 and included analysing particulate matter (less than 10microns (PM10) and less than 2.5 microns (PM2.5)) and total suspended particulates (TSP) usingportable air samplers and dust deposition gauges around the Mine Footprint. Sampling of ambientsulphur dioxide (SO2) and nitrogen dioxide (NO2) concentrations was also undertaken.

Noise monitoring Noise loggers monitored ambient noise around the Mine Footprint. Noise descriptors including L10, L90,Leq and a number of statistical parameters were also logged.

Biodiversity monitoring Wet (August to November 2004) and dry (December 2004 to March 2005) season fauna, flora andaquatic field studies have been completed.

Survey of major institutionalfeatures

Conducted in early 2004, this survey resulted in a database of education, religious and healthinstitutions, cultural sites, historical sites, and graveyards.

Demographic and socio-economic information

A demographic and socio-economic survey was conducted of every household within the 5 KilometreZone plus areas of the Mine Footprint outside this Zone.

Village checklist An inventory of all community infrastructure, services and facilities in villages located within the 5Kilometre Zone.

Resettlement survey A survey of all households and business enterprises potentially affected by the proposed mine.

Host community survey A demographic and socio-economic survey conducted in the proposed host community sites.

Survey of government andnon-government institutions

The survey identified NGOs and government organisations in the Study Area.

Archaeology and heritage Archaeologically significant locations in and around the Study Area were assessed.

Population projections Projected population in the Study Area was assessed between 2004 and 2051 (in five-year intervals).Anthropology andindigenous groups

The traditions, cultural inheritance and impact of the Project on the indigenous groups were assessed.

Socio-economics The local and regional socio-economic impact of the mining operation on the community and theenvironment has been assessed.

Health impact assessment A study of the local and regional impact of mining operations on community health and safety in theStudy Area and the collection of baseline health data.

Traffic survey Traffic counts were conducted in and around Phulbari to assess impacts on traffic flow and determinenew road cross-sectional requirements.

Town planning survey Ascertained land use characteristics within the existing Phulbari Township such as existing structuretypes and conditions, zoning areas, transport routes, house types and plot sizes, public utilities andaccess to facilities.

GIS land ownership survey This survey developed a GIS database of land ownership.


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3.1.7 Analysis of Alternatives

The Study Team investigated a range of options, which generally followed the guidance provided byIFCs Operational Policy OP 4.01 (1998i)and the World Banks Environmental Assessment SourcebookUpdate: Analysis of Alternatives in Environmental Assessment (1996). The results of these

investigations are presented in Chapter 5. A preferred option was then adopted for detailedassessment.

3.1.8 Impact Assessment

Impact assessment was a two part process, divided into assessment of impacts both before and afterthe implementation of mitigation measures; the latter being referred to as residual impacts. A varietyof discipline-specific methods were used for impact prediction including modelling, experiences ofsimilar projects, experiences in similar biophysical and socio-economic environments, matrices andchecklists, and expert judgement. Discipline-specific methodologies are detailed in the respectivetechnical reports.

i. Assessment of Impacts befo re Mitigat ionThis assessment included consideration of:

direct/primary impacts;

indirect/secondary impacts;

cumulative impacts;

synergistic impacts;

the duration of impacts (short, medium, long term);

the areal extent of the impact (including any transboundary aspects); whether impacts are temporary or permanent; and

legislative and policy implications.

Where mitigation measures were not expected to completely mitigate any adverse potential impacts, anassessment of residual impacts was undertaken.

ii . Residual ImpactsAssessment of residual impacts followed a similar methodology to that described above but included anassessment of the significance of the residual impact. Evaluation of the significance of a residual

impact followed standard risk assessment methodology, such as that described in Australian StandardAS/NZS 4360: Risk Management (2004), and included consideration of:

the likelihood of impact occurrence; and

the severity or consequence of the impact in the biophysical and/or socio-economic context(including whether impacts will breach GoB legislation or Project objectives).

Apart from where it is indicated by modelling, it is recognised that the evaluation of the likelihood ofimpact occurrence is largely subjective and based upon the expert judgement of discipline specialists.


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a) LikelihoodFollowing the guidance provided in Table 3.4, an assessment of the likelihood of residual impactoccurrence was made for each environmental and social aspect in Chapters 9 and 10.

Table 3.4: Residual Impact L ikelihood Ranking

Rating Definition

Certain The impact is expected to occur under normal operating conditions

Likely The impact will probably occur under normal operating conditions

Possible The impact should occur at some time under normal operating conditions

Unlikely The impact could occur under normal operating conditions

Rare The impact may occur in exceptional circumstances

b) Severity/ConsequenceAs the severity or consequence of an impact will be different for each environmental discipline, severity /consequence rankings have been developed by specialists from each discipline. For all disciplines, therankings were developed based on consideration of:

whether the impact will breach legislative or policy requirements;

the sensitivity of receptors;

duration of the impact, i.e. whether the impact is permanent or temporary; and

the areal extent/magnitude of the impact and/or how many people it will affect.

The rankings for socio-economic residual impacts were also determined on the basis of the above list,along with consideration of the potential for unrealised expectations by Project-affected parties.

c) SignificanceThe overall significance of a residual impact is considered to be a product of the severity orconsequence of a potential impact and the likelihood that it will occur (Table 3.5). Ratings for bothseverity/consequence and likelihood have been ranked, and based on the combination of these factors,the significance of a residual impact has been assessed as low (L), medium (M), or high (H).

Table 3.5: Significance Assessment Matrix

Severity / Consequence RatingLikelihoodRating Negligible Minor Moderate High Very High

Certain L-M M M-H H H

Likely L L-M M M-H H

Possible L L-M M M M-H

Unlikely L L L-M L-M M

Rare L L L L-M M


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Significance is defined as follows:

High residual risk: H: This level of risk indicates that significant resources and/or Project modificationwould be required to manage potential environmental damage. These risks can be accommodated in aproject of this size, however comprehensive and effective monitoring measures would need to beemployed such that Project activities are halted and/or appropriately moderated. No environmental orsocial issues have been identified as having a high residual risk.

Medium - High residual risk: M-H: This level of risk also requires that sufficient resources areallocated to monitoring operations and that on occasion some Project activities may need to bemoderated. However, it is not expected that activities would need to be halted or suspended forextended periods. Four issues are identified in this category; air, water management, land loss andunmet unemployment expectations.

Medium residual risk: M: Less significant than above risk rankings, however management procedureswill need to ensure necessary actions are quickly taken in response to perceived or actualenvironmental damage. Issues identified in this category are soils, land use, noise, surface water

quality, groundwater levels, subsidence, visual impact, waste management, compensation, injudicioususe of compensation, split communities, community tension and increase in disease

Low - Medium residual risk : L-M: This level of risk requires ongoing monitoring, however resourcesallocation are less of a priority than higher risk rankings. It is unlikely that Project activities would besignificantly disrupted. Five issues identified in this category are groundwater quality, terrestrialspecies, aquatic species, pressure / disruption to infrastructure and demands on local government.

Low residual risk: L: This level of risk indicates ongoing monitoring; however resources allocation andresponses would have low priority with regard to higher ranked risks. Issue identified in this categoryare flooding, greenhouse gases and re-establishment of businesses.

Where significance was assessed to be medium or higher, mitigation options were reviewed toascertain whether any further mitigation measures could be employed to further reduce impacts.

3.1.9 Formulation of Mitigation and Management Strategies

Measures to mitigate potential adverse impacts have been integrated with mine planning and designactivities. Identifying and assessing the appropriateness of mitigation measures before the mine plan isfinalised maximises opportunities for minimising, or preferably avoiding, potential impacts. A range ofmitigation options were considered during the mine planning and design process. For example:

reducing resettlement numbers (eg. the mine path was altered to avoid most of the easternpart of Phulbari Township, at a resource loss of 20 Mt);

avoidance (eg. the option of using a tailings pond was rejected on social and environmentalgrounds);

environmental measures (eg. water treatment facilities);

compensatory measures (eg. for land acquisition);

design optimisation (eg. use of conveyors rather than roads for conveying coal);

procedural measures (eg. rehabilitation to be undertaken in a progressive manner to minimiseenvironmental impacts); and

timing measures (eg. no blasting at night).


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Mitigation measures have been tailored to suit the locality, taking into consideration:

concerns and suggestions raised during the community consultation process;

baseline biophysical and socio-economic conditions;

identified environmental and social constraints;

any impacts associated with the implementation or operation of proposed mitigation measures;and

the level of design information available at the time of preparation of the ESIA.

Opportunities for enhancement of beneficial impacts of Project development were also considered atthis stage.

3.1.10 Risk Analysis

The Project is one of the largest developments of its kind in Bangladesh and has the potential ofbringing significant benefits to the country. However, there are a number of risks and uncertaintiesassociated with such projects. These relate to political, institutional, market, technical, environmentaland social issues. These issues have been subjectively evaluated in Chapter 15, and where possiblemitigation actions recommended and opportunities for financial institutions highlighted.

3.1.11 Submission of IEE and EIA to GoB

As indicated in Chapter 1, both the IEE and EIA have been submitted to the GoB and conditionalenvironmental clearance issued in favour of Asia Energy for the Project to proceed.

3.2 STATUS OF PROJECT STUDIES

Resource assessment and feasibility level hydrogeological, environmental, social and geotechnicaltesting are complete. A conceptual Mine Plan, including mine infrastructure requirements, wascompleted in September 2005. The Project Scheme of Development was submitted to the GoB inOctober 2005.

The environmental monitoring programme is ongoing and will continue in modified forms throughout theProject life in accordance with the Project Environmental Social Action Plan (ESAP). An ongoingmonitoring programme will cover:

meteorology;

air quality;

noise;

biodiversity;

surface water quality, level, volume, and velocity; and

groundwater depth and quality.

With regards to socio-economic data collection activities, the demographic, resettlement and villagecheck list surveys, which commenced in 2004 to collect baseline data from those households both

within and on the fringes of 5 Kilometre Zone, are mostly complete.


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Consultation with stakeholders and information dissemination is also an ongoing process and existingconsultation activities will be continued and expanded upon throughout the life of the Project.

3.3 STUDY LIMITATIONS

i. Study Integration and Ancil lary DevelopmentsIFC Operational Policy OP 4.01 stipulates that an ESIA should evaluate potential environmental risksand impacts in its area of influence. The Policy further defines the area of influence as the area likelyto be affected by the project, including all its ancillary aspects. While the main aspect of this scheme(the mining operation) has been subjected to detailed baseline studies and impact assessment, ancillarydevelopments have not been subjected to the same level of assessment. While mining / explorationleases are held for some of the mining operation site, physical areas and operational details for ancillarydevelopments require intensive consultation and negotiation with the GoB before they can beconfirmed. These constraints had limited ancillary scheme development to preliminary studies, andconceptual planning and design at the time of ESIA writing.

Approval for the preferred location for resettlement of part of eastern Phulbari Township residents hasyet to be obtained from the GoB. The preferred areas for relocation of villages have been finalised.Environmental studies on resettlement areas have been limited to a qualitative study of impacts arisingfrom the proposed western extension to Phulbari Township.

Studies on coal transport infrastructure options commenced in June 2005 with a preliminaryenvironmental and social impact assessment completed in September 2005. Due to timing constraintsand differences in the level of assessment undertaken, this report has been summarised into Chapter11 of this ESIA rather than integrated into the main assessment chapters of the ESIA. This study wasundertaken within a short timeframe that did not allow specific, detailed environmental investigations tobe undertaken. It therefore relied heavily on information from previous studies, site inspections and

limited field monitoring. There are obvious limitations to this approach, as previous studies providedlimited information of specific relevance to this Project. The accuracy and reliability of this data areunknown. An ESIA for coal transport, based on more detailed environmental field monitoring and socialassessment is being prepared separately (SMEC 2006).

The Mine Footprint initially included the entire portion of Phulbari Township east of the Little JamunaRiver. The Footprint was modified in mid-September 2005 to exclude most of the Township, whichreduced the number of households facing displacement by just over 25 percent, but has also reducedthe buffer zone distance between mine operations and residential areas, and shortened the life of themine. Air and noise models have been re-run to reflect these changes and air quality and noiseimpacts, and suggested mitigation measures have been incorporated into this ESIA. However, due totime constraints, other earlier reports which these changes may impact upon, have not been updated.Thus, small discrepancies in presented data and analysis may be evident.

ii . Baseline StudiesThis ESIA includes secondary information from previous studies and ongoing monitoring from variousgovernment agencies. The accuracy and reliability of this secondary data are unknown.

Site-specific primary data collection for various studies commenced between 2001 and late 2004.Where temporal variation of a parameter would affect impact assessment or design of mitigationmeasures, it is general practice to collect data over at least a 12 month period. Site-specific monitoringof meteorology and ambient air quality, commenced in November 2004, thus less than 12 months of

primary data has been collected for these disciplines at the time of reporting. However, site-specificmeteorological monitoring has been supplemented by 56 years of regional meteorological data from theDinajpur Bureau of Meteorological and a prognostic meteorological model based on synoptic data, andsite-specific ambient air quality monitoring has captured the entire dry season, considered to be the


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worst-case scenario for ambient air quality conditions. Therefore, while collection of marginally lessthan 12 months of site-specific data is not ideal, it is considered that temporal variation has beenadequately reflected in impact modelling and mitigation proposals. Asia Energy plans to continuemonitoring into the Project development, operation and decommissioning phases, and has committed toamending management and mitigation measures to reflect any temporal variations if necessary.

iii. Mine PlanningThe consultant reports are based on available data at the time of writing. During the detailed mine andinfrastructure planning phases, alterations to mine shape, depth and configuration may occur. This ispart of the normal mine planning optimisation routine, but means that the final mine shape configurationand infrastructure may vary to that presented in consultant reports as well as the ESIA. Any alterationsto the mine pit configuration may necessitate adjustments to estimated land acquisition and populationdisplacement figures contained within this ESIA, such as occurred in September 2005. However anyfurther mine configuration alterations is not expected to substantially alter the environmental and socio-economic assessments contained within this report.

iv . Compliance with the Equator PrinciplesAt this stage of mine planning, constant refinements are being made, and mine infrastructure design islargely at conceptual stage. Therefore, due to time constraints given for completion of ESIA studies,there have been some areas of non-compliance with the Equator Principles. These areas of non-compliance relate mainly to the level of design information available for mine infrastructure andmitigation measures at the time of writing the ESIA.

As some mitigation measures were only at the conceptual design stage (for example, site drainage andProject landfill) or were in the process of detailed design at time of writing (for example, irrigationsystem), a detailed assessment of potential impacts of all mitigation measures has not beenundertaken. Where detailed assessment was not possible, this has been indicated and a qualitative

assessment conducted to the extent possible.


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APPENDIX

April, 2006

Appendix 3.1: The Study Team

TECHNICAL

SMEC International Pty Ltd, Australia Project management, social impact assessment, resettlement planning,environmental monitoring, water hydrology and modelling, GIS, air quality,noise, water quality, rehabilitation, traffic, Environmental ManagementPlan, town planning, IEE, EIA/SIA and ESIA reporting

GHD Pty Ltd, Australia Resource evaluation, geotechnics, hydrogeology, local and regionalinfrastructure and transport, economics, data management, geophysics,river diversion studies

MineConsult Pty Ltd, Australia Mine design, mine scheduling

QCC Ltd, Australia Coal quality, coal treatment plant

Coffey Geosciences Pty Ltd Water management, initial mine water balance

Molino Stewart Pty Ltd Review of ESIA

Centre for Environmental and Geographic InformationServices (CEGIS), Bangladesh

GIS database, surveying, field hydrology instrumentation, data collection

Nature Conservation Management (NACOM) Dry and wet season ecological database, biodiversity field survey

Bangladesh Atomic Energy Commission (BAEC) Airborne particulate matter sample analysis, quality assurance auditing,

geophysical borehole logging

Bangladesh Centre for Advanced Studies (BCAS) Resettlement surveys

Health Promotions Limited Health impact assessment

Institute of Water Modelling (IWM), Bangladesh Regional surface water modelling

The World Conservation Union (IUCN) Legislation, policy advice, peer review of biodiversity

Dr K.M. Ahmed, Dhaka University Arsenic in groundwater assessment

Dr N Kamal K.Z. Ashan, Independent University Demographics

Dr Chris Johansen Agriculture, economics

Mr Mannan, Independent University Anthropology, ethnic minorities

Professor M Hoque, Jahangirnagar University Archaeology, historical sites

Dr Amin, Hazi Danesh Science & Technology University,Dinajpur

Soil science, agriculture

Professor SMM Rahman, Dhaka University Socio-economics

SWV Consulting Mine water balance

Peer Review

SMEC International Pty Ltd, Australia Peer review of biodiversity, social surveys

Dr Zaman, Canada Peer review of resettlement, community consultation

Dr Chris Johansen Peer review of mine rehabilitation, soils

Dr Ricky Kwan Peer review of surface water hydrology

Dr Peter Hawkins, Australia Peer review of water chemistry

FUGRO, Australia Peer review of surveying

Ron Connolly and Associates Peer review of soils and rehabilitation

Wilkinson Murray Peer review of air quality, noise and blasting reports

Laboratories

ALS Environmental Laboratories, Australia Water quality testing

Bangladesh University of Engineering and Technology(BUET)

Water quality testing

International Centre for Diarrhoeal Disease Research,Bangladesh (ICDDR,B)

Bacteriological and arsenic testing

AP

PENDIX3.1:THESTUDYTEAM

dinajpur coal mine

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