Project land acquisition and community consultation:

This project does not involve any physical resettlement. LOPL has made every attempt to ensure that any potential economic displacement resulting from project land acquisition is minimized. This is supported by LOPL''s corporate social commitment to avoid adverse secondary socio-economic effects on the local community, provide work to local the local community within available skill range, and support social welfare initiatives that benefit the local community. Currently LOPL pays rent / lease money to private landowners at the rate of Rs 12000.00 per acre / anum for cultivable land and Rs 5000.00 per acre / anum for uncultivatable land.

LOPL uses 224 acres of land for well locations, water points, access road, and airstrip and a further 121 acres are currently being acquired for the Gas Plant Site, Contractors’ camps, Base Camp and Gathering line. The land currently used by the project is arid and predominantly unsuitable for agriculture and has, at the most, only limited use for grazing. Of the total of 224 acres (including the area occupied by the existing public road) utilized by LOPL, only 6 acres are private land, with the rest belonging to the government.

Operational activities began in 1995 and the first land claims were registered in 1997. A full survey of the legal status of ownership was not carried out at that time, although LOPL did review existing documents shown by claimants and verified by the community. In 1999 a more exhaustive review of the land tenure situation was undertaken by LOPL establishing that in approximately 50 cases, LOPL had made land rental agreements in 1997 with land occupiers and not the landowners. All claimants were asked to provide ownership documents and provide the registered lease agreements as required by Pakistani Law. The District Administration confirmed that most of the land used by LOPL belonged to the government and that rents should not be paid to claimants that could not prove legal claim to the land. LOPL continues to encourage land claimants to meet with the Deputy Commissioner to resolve these issues.

During a meeting held at Naing village on the 17 December 2000, the LOPL Kirthar Asset Manager of the project appraised an audience of tribal leaders and 200 tribesmen, representing 17 different tribes, that the Deputy Commissioner and other concerned government authorities have told LOPL not to pay rent to the occupants who had no legal ownership because of the precedent it set. The Government has asked LOPL to refer all claimants to the Deputy Commissioner. He told the community that issues would be resolved as per government instructions and he advised them to meet the Deputy Commissioner if they were not satisfied. He assured them of full sympathetic co-operation from LOPL in negotiations with the Deputy Commissioner and assigned LOPL’s Land and Legal Officer to assist them in their meetings with district revenue officers. The majority of those present agreed and some have participated in a meeting with their regional sub-divisional revenue officer (Mukhtiarkar) accompanied by LOPL''s Land and Legal Officer. During this meeting, the Mukhtiarkar explained the Government''s position.

LOPL is following closely the situation of those claimants who have partial titles to grazing land in the area and will make rental payments to any claims the government recognizes. In order to avoid any possible economic dislocation, LOPL will also consider non-monetary compensation, including increased access to labor opportunities.

The status of the land acquisition process for the additional 121 acres for the Gas Plant Site, Contractors’ camps, Base Camp and Gathering lines is as follows. LOPL and the Government Revenue Department (Mukhtiarkar, First Class Magistrate and sub-divisional Revenue Officer in Sehwan) report that this is state land and its physical condition is "rocky and uncultivatable The rental arrangements of this government land will be concluded within the next few months during the field mobilization period. There are no cases of economic displacement on these lands.

Community Development and Community Relations Programs

The project continues to provide a wide variety of assistance to local communities. LOPL has also made a concerted effort to communicate and consult with local stakeholders concerning their community development needs (jobs, health and educational services). This commitment extends from the Asset Manager to local field staff. For the last three years, LOPL has carried out regular consultation meetings hosted by the communities closest to the project (Naing and Kai), as well as Jhangara, the immediate area’s largest population center. This consultation has provided the basis for current and future community development projects. LOPL works with both local (Al-Shahbaz in Jhangara) and national NGOs (RAASTA Development Consultants and Aga Khan Community Health Sciences) to implement and guide current initiative programs in general health, maternity care, education, and a computer training center. The most successful effort thus far is the Maternity and Child Health Center in Jhangara. It is equipped with a pathological laboratory, maternity ward, examination room, and ambulance to serve the Kacho area communities 24 hour a day. The center is staffed largely by women and includes a woman doctor, two lab assistants, one midwife, and one Traditional Birth Attendant. Established in 1998, patients have increased from an initial monthly total of less than 200 to 800 currently. The center sends 4 mobile clinics to the remote villages every month to provide direct health services.

Current contributions to these community developments were made as part of the LOPL policies for community relations and social responsibilities. At present, LOPL’s annual budget for these programs amounts to about US$50,000 which the company expects to increase when the production starts. Future initiatives include support for water wells, sewage disposal, and appropriate dry land agriculture. The IFC concluded that LOPL has established excellent relationships and communications with local stakeholders.

LOPL’s support has been well received in this poor and drought prone area of Pakistan. The local population of about 14,000 comprises 3 Sindhi-speaking clans (the Shahanis, the Noohanis, and the Muree) living in 10 communities. Local community leaders or Sardars represent them. The Muree maintain homes in several communities (in and beyond the project area) as they migrate seasonally in search of pasture for their goats. All three groups have been designated for community development activities, jobs, and (where applicable) land rents. The closest communities to the project, Kai and Naing, with about 800 people, are those that will receive more attention in community development programs.

During construction of the project, a peak workforce of 1750 people, including 200 local laborers, will be required. The construction camp will be fenced and operated in a self-contained manner to minimize negative impacts to the local communities. Only local workers will be allowed to leave the camp at night and all workers must wear identification badges.

Public Consultation and Disclosure

Since entering the area, LOPL has consulted with local communities and their leaders (Sardars) numerous times on a wide range of issues. An example of this was that as part of the Environmental Impact Assessment approval, the local community was consulted. Consultation also included discussion on provision of jobs and community development activities. LOPL will continue its practice of consultation with local communities and their leaders to explain the next phase of the project (construction of the gas plant). This including labor recruitment, noise and vehicular traffic associated with construction, the enhancement of the community development plan, and arrangements for land use compensation. Public disclosure of the project will occur via local newspaper in local languages and the ERS will be available in the offices of the Sub Divisional Magistrate in Sehwan and Johi and the Deputy Commissioner in Dadu.

Cultural Property

The Environmental Impact Assessment (EIA) noted the existence of important cultural heritage sites in the district where the project is located, including shrines. In consideration of these findings, LOPL subsequently commissioned an archeological survey of the area. Thus far, no artifacts have been found in the immediate project area. LOPL has produced an ‘Accidental Discovery Plan’ to be used in the event that an unanticipated cultural property is discovered during construction. This plan outlines the measures to be taken to ensure that artifacts are protected for further study.

Protection of Air and Water Resources:

The gas from the Bhit field has nitrogen content of 19% and will pass through a nitrogen rejection unit, to lower the content to 7% by volume. The stripped nitrogen will be vented along with a minimal amount of methane. The non-recoverable hydrocarbon gas will be vented through an elevated stack. LOPL will initially be using dual fuel burners for gas and condensate. Currently, low NOx burners are available for gas only but it is anticipated that in the next 2-3 years, low NOx dual fuel burners will be available and LOPL will retrofit the processing plant at that time. LOPL has calculated that 8.83 mmscfd CO2 will be released to the atmosphere annually from the process and production equipment. Water required for drilling, operations, fire fighting, etc., will be produced from a local aquifer. Produced water will be treated to remove oil and then re-injected back 1800 meters down under the surface. There are no surface water resources except for intermittent monsoon collections. Two monitoring wells will be installed to ensure that aquifers are not contaminated.

Management of Waste Materials:

The project will produce several limited waste streams. During drilling, waste cuttings and mud will be encapsulated in cement tombs located next to the airstrip. These will then be used as parking spots. During production the processing plant will consist of pre-treatment, nitrogen recovery and export compression. Waste from processing includes mercury, which will be filtered out of the gas stream before the gas goes through the nitrogen recovery unit. It is estimated that the mercury filters will last the life of the field and during decommissioning will be sent back to the manufacturer. Spent amine solution will be either regenerated on-site or exported to a refinery. Small amounts of condensate produced with the gas will be separated and used as fuel. Sewage will be processed in septic tanks and the residual effluent will be used to water trees planted around the site. Non-hazardous waste will be either buried in an on-site landfill or incinerated. The management of wst material is covered in the Environmental Impact Assessment report.

Public and Worker Safety:

The LOPL project has evolved a Health, Safety, Environment and Security (HSES) management system. The use of Personal Protective Equipment (PPE) is rigorously enforced and safety briefings are given to all visitors. The existing base-camp is fenced and the construction camp will also be fenced. An HSE Emergency Response Plan and an Environmental Management Plan, which already exists under the Environmental Impact Assessment, will be in place before construction commences. Because of the remote location of the site, LOPL are not able to rely on outside assistance in an emergency. They will have their own fire truck, an airstrip capable of night landings for emergency evacuations, a full time doctor and trained first aiders on-site at all times.

Noise:

During the construction phase, background noise levels will increase at the plant site and during well drilling noise will increase at well sites. Construction noise will be short in duration and is not anticipated to cause an impact to surrounding communities because of the remote location of the project.

Contamination from current and past operations:

Currently, there are 6 wells that were installed for exploration purposes in the Bhit field. Prior to any drilling ane environmental impact assessment was carried out and Provincial Government approval obtained. Prior to exploration, the location was a green field site with no commercial or industrial activities. Disused well sites have been restored to pre-construction conditions, are neat, fenced in and show no evidence of soil contamination.

Sui Southern Gas Company''s 42-km spur pipeline:

The pipeline route passes within 7 km of Lake Manchar, which is a Ramsar site, but it will not have any impact upon the lake. The pipeline will be buried parallel to the existing government road approximately 1-km away, and passes through mostly barren land though some of which may have some agricultural potential following monsoon rains. It was not possible at this juncture to determine if any landowner would actually lose access to land. Sui Southern Gas Company (SSGC) has a division that deals with land compensations and its reputation is one of thoroughness and fairness.

LOPL will be preparing an Environmental Management Plan that outlines mitigation, monitoring and management activities prior to commencing construction. In addition, LOPL is in the process of obtaining ISO 14001 certification with a target date of June 2001.