IFC requires that this document is made available through the World Bank InfoShop and to the locally affected community no less than 30 days prior to project consideration by the IFC Board of Directors. The Summary of Project Information (SPI) also provides details of where the ERS has been made available to the locally affected community. The SPI must be sent to World Bank InfoShop no less than 30 days prior to project consideration by the IFC Board of Directors.

This is a Category B project according to IFC’s Procedure for Environmental and Social Review of Projects because a limited number of specific environmental and social impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. The review of this project consisted of appraising technical and environmental/social information submitted by the project sponsor. The following potential environment, health and safety and social impacts of the projects were analyzed. - Environmental Management System and operational performance; - Compliance with international standards such as Marpol and IMO; - Air emissions; - Liquid and solid waste disposal; - Oil spill response; - Whale breeding or migration; - Shipping lanes or fishing; - Occupational health and safety issues including fire protection, emergency response, and control of employee exposure to noise; and - Community Development Applicable environmental and social policies and guidelines for this project are: Oil and Gas Development (Offshore) Guidelines (December 2000); Occupational Health & Safety Guidelines (June 2003); Operational Policy (OP) 4.01 Environmental Assessment (October 1998); OP 4.04 Natural Habitats (November 1998); Policy on Disclosure of Information (September 1998); and Policy Statement on Child/Forced labor (March 1998).

As described above, this project is an existing IFC client that is planning the next phase of its exploration and development activities at the same offshore location. As such the sponsor has management plans in place that address the potential impacts identified. The plans were developed for the first phase of operations and will be updated as required to cover all proposed new activities as appropriate. Implementation of the measures contained within these plans will ensure that the project activities comply with applicable host country laws and regulations and World Bank/IFC requirements. The sponsor will also develop and produce an Environmental Impact Assessment (EIA) for each new stage of development as required by the host government and will ensure that the commitments made in the EIA (s) will be incorporated into the management plans. Information on how the potential impacts will be addressed by the sponsor is summarized in the paragraphs below. The government of Gabon is a signator and has ratified the Marpol convention relating to the prevention of pollution from ships. The Floating, Production, Storage and Offloading (FPSO) facility that is on location in the Etame Block and, which will continue as the central project facility for the project, complies with Marpol requirements as well as all federal, state and local health, safety and environmental laws and regulations, as is required in the FPSO contractor’s contract with the company. Air emissions from the FPSO will be limited. The largest contribution will be from flaring of associated gas, however flaring volumes will be small as only limited gas is produced in association with the oil. Associated gas is used as a fuel gas to generate power for the offshore facilities (and potentially for gas lift operations in the coming years). The remaining volumes of gas are flared. Current flaring volumes are approximately 2 MMscfd. While flaring volumes are likely to increase through further development to an estimated peak of 5 MMscfd in 2006, forecasting indicates that volumes are likely to fall rapidly thereafter. A gas utilization study has been conducted by the company to assess all possible associated gas usage. This study shows that gas utilization for power generation and gas lift requirements will use all gas production by 2009 resulting in an end to routine flaring, with a forecasted gas deficit at the field thereafter. Considering the remote offshore location of the field, gas export options are not viable for the small excess volumes available. Liquid and solid waste generated onboard the FPSO will be the responsibility of the FPSO contractor. At present, wastes are segregated and stored then sent to shore for disposal. The FPSO contractor will update their Hazardous Material Management Plan and Waste Management Plan to cover proposed future activities as appropriate. Drilling wastes will be the responsibility of the drilling contractor. Cuttings and muds from well sections drilled with water based muds (WBMs) will be discharged over board. Cuttings from wells drilled with oil based muds (OBMs) will be contained and shipped to shore for treatment and disposal, excess oil based muds will be returned to the vendor for recycling. Drilling muds and any drilled cuttings to be discharged will be in compliance with the toxicity testing and discharge requirements contained in the IFC Oil and Gas (Offshore) Guidelines, 2000. The sponsor will update their current Cuttings/ Mud Disposal Plan as appropriate for future drilling activities. All drilling contractors engaged for the project will be obliged to adhere to all project Waste Management and Disposal Plans. All produced water will be treated on board the FPSO produced water treatment system and discharged overboard. Effluents will meet the standard limits contained in the IFC Oil and Gas (Offshore) Guidelines, 2000. FPSO drainage waters are routed to the produced water treatment system. The FPSO contractor has an Accidental Discharge Prevention Plan that contains the requirements for the prevention of unintentional discharges of gas, liquids and solids to the environment. This plan will be updated to cover proposed future activities as appropriate. The current Oil Spill Contingency Plan for the project will be updated to cover proposed future activities. This will include a training and drill schedule as required by IFC Oil and Gas (Offshore) Guidelines, 2000. The company has an established emergency response organization to provide emergency response and control of emergency situations. This will be updated for new activities if required. To minimize produced fluid spills during operations, the FPSO has fitted isolation shutdown valves on production risers and production off take lines that will allow for rapid shutdown of these systems as necessary. During drilling activities both primary and secondary well control measures will be applied. These include careful control of drilling mud density to apply a sufficient head of pressure downhole and the installation of a blow out preventor stack on each well. Current and planned activities are located some 20 miles offshore and to the west of the Mayumba national park. The park was established in 2002 by the Government of Gabon working with the Wildlife Conservation Society (WCS). While a portion of the Etame Block also overlaps the park area no future activities are planned in this portion of the Block. The most sensitive species offshore are whales which seasonally migrate through the area. Project activities that may result in highest disturbance to whales such as offshore construction or seismic surveys will be scheduled as far as possible to minimize impacts during critical seasons (e,g. breeding, migration). If whales are sighted, all project vessels are required to maintain a minimum distance of 1,600 meters. They will not cross directly in front of migrating whales, not separate females from their calves, will not herd or drive whales and when traveling parallel to whales will operate at a speed not faster than the whales are moving. The company regularly consults with the government and WCS about their principal activities prior to the onset of the activities to ensure that any specific sensitivities are understood and considered during planning. There are no known shipping lanes crossing the project area. Provision of navigation systems and communications on board all facilities provides adequate warning to other shipping of the presence of the facilities. There is no fishing in the project area due to the distance from shore. The Health, Safety, Environment and Quality Assurance Plan for the project will be updated to cover proposed future activities. This plan covers all safety issues including fire protection, facility evacuation and worker exposure to chemicals and noise. All drilling contractors engaged for the project will be obliged to adhere to all Health, Safety, Environment and Quality procedures for the project. The project is almost entirely located offshore. Onshore only warehousing and docking at shared facilities at Port-Gentil, an office in Port-Gentil and travel to the offshore facilities via a small airport in Mayumba is used by the company. The company provides and annual development contribution to the town of Mayumba and has provided school books and supplies for children, funds for capacity building initiatives, as well as responded to ad hoc requests from the town’s authorities. The company plans to continue delivering social programs by focusing on education and sanitation programs.

This ERS contains the full environmental and social documentation prepared for the project.

Accordingly, IFC concludes that the proposed project will meet the applicable World Bank/IFC environment and social policies and the environmental, health and safety guidelines upon successful implementation of the agreed mitigation measures and, as required, developed updates to the project management plans as listed in the attached Action Plan.

IFC will evaluate the project's compliance with the applicable environmental and social requirements during the lifetime of the project by reviewing the annual monitoring reports (AMRs) prepared for the project covering: - the status of implementation of any measures contained in the Environmental Impact Assessments and Health, Safety, Environmental and Social Management Plans and - ongoing performance of project-specific environmental, health and safety and social activities. Periodic site supervision visits will also be conducted. The current AMR will be periodically updated to reflect project activities.