Environmental Policy:
The Company will develop and implement a Corporate and Site Specific HSEC Policy for its exploration projects to identify, assess and adequately manage existing ESHS risks and impacts from exploration activities. The HSEC Policy will be developed with assistance from IFC, with key components which are part of this Policy, including the manual, management plans and standard operational procedures (SOPs) developed by Colombian Mines with support from an external international consultant experienced in the use of good international industry practices (GIIP) for this phase of work (See Action 1 of the ESAP).
Based on the findings of the site visit, key management plans and/or SOPs to be developed as part of the HSEC Policy include those addressing pollution prevention (fuel management, spills, dust, noise, etc), solid and liquid waste, erosion control and re-vegetation, footprint management, biodiversity management, surface and ground water resources management, environmental monitoring, occupational, health and safety, emergency response and contingency planning, road safety and transportation, stakeholder engagement, grievance mechanism and land access procedure. Other plans to be developed as part of the HSEC Policy and aligned with the continuous improvement cycle will include an ESHS Training Plan, an Impacts Identification Procedure and a Non-Compliance Corrective Action Procedure, among others (See Action 1 of the ESAP).
Identification of Risks and Impacts:
The management of risks discussion in this ESRS consists of those associated with exploration, as IFC is only financing exploration and feasibility study activities which have limited impacts on social and environmental receptors. If any of the exploration prospects proceed to the mining development phase, Colombian Mines will prepare the necessary environmental and social impact assessment (ESIA) documentation to demonstrate compliance with IFC’s Performance Standards.
In 2011 about 34% of the population in Colombia was at or below the national poverty line, and this percentage has fluctuated over the years in line with the economic cycle, making expectations for support on improved living conditions and employment in the community high. In addition to this, the Concession is located within a rural area with limited access due to road and climatic conditions. The Company is aware of this and is taking steps to engage with the local communities to provide information on the Project and manage expectations. Furthermore, the development of a formal Stakeholder Engagement Plan as part of IFC’s investment will support the Project in providing adequate and timely information to local communities and other key stakeholders, receiving feedback, adequately addressing any concerns or grievances and managing expectations and perceptions.
The Company wholly owns the El Dovio Concession where drilling efforts are focused This Concession is located within a wid
er Forest Reserve (Reserva Forestal del Pacifico) created in 1959 which extends for 8,010,504 hectares through the Departments of Choco, Antioquia, Cauca, Córdoba, Nariño, Risaralda and Valle del Cauca. In order to allow for exploration activities, the Company applied for, and was granted, a temporary “substraction” permit (substraccion temporal) for an area of 60 hectares within its wider concession and within the Reserve (through Resolution No 1876 dated October 22, 2012). This Resolution also includes several environmental management and reporting requirements to be followed by the Company during this ongoing exploration work.
Colombian regulations require the adoption of a Mining and Environmental Guide (Guia Minero Ambiental) developed by the Ministry of Energy and Mines and Ministry of Environment and Sustainable Development to guide environmental management of exploration activities. The Guide includes a basic description of exploration activities, an evaluation of impacts relevant to this phase of work and the adoption of environmental and social management practices to address relevant impacts. Reporting on environmental activities by the Company includes the preparation of an environmental report submitted by Colombian Mines on a biannual basis to the Ministry of Environment and the Corporacion Autonoma del Valle del Cauca – CVC).
Management Programs:
Although there is an adequate level of environmental and health and safety management at El Dovio, the Company has not yet developed or formalized environmental, social or health and safety procedures to manage existing risks. As part of the HSEC Policy to be developed, the necessary management plans and/or SOPs will be developed to manage current and future risks for the project (Action 1 of the ESAP).
Organizational Capacity:
The Company’s current organizational structure includes a President and CEO of the Canadian parent and a Country Manager / President of the Colombian operating company at the country level, who in turn oversees the work of the Project Supervisor. The Company also has 4 independent Directors. The Company’s senior management values a relationship with IFC to assist the Company in carrying out its exploration activities in line with GIIP.
In terms of ESHS personnel at El Dovio, the Company has an external environmental and a social advisor and an in-house health and safety representative who report to the Project Supervisor and the Country Manager. Currently, the Company does not have any in-house environmental or social specialists.
In order to strengthen its E&S capacity, the Company will contract additional ESHS support in the form of an experienced international environmental and social consultant for development of the relevant plans and procedures as part of the HSEC Policy and to assist in their implementation and training. Also, Colombian Mines will hire an in-house experienced E&S specialist who will oversee the implementation
of the HSEC Policy during the exploration phase of the project (see Action 2 of the ESAP).
Training:
Health and safety training to staff and contractors on the use of PPE and the identification of risks is done on an ad-hoc basis. The development of the HSEC Policy and a training plan (Action 1 of the ESAP) will address the necessary competency training requirements for this phase of work including frequency, training topics and documentation necessary to assess the level of environmental, social and health and safety awareness of direct workers and contractors.
Monitoring and Review:
The Company is required to undertake environmental monitoring as part of its approved permits, which includes measurements of the quantities of water subtracted for drilling activities and for the camp, flows of surface water bodies near the project area, meteorological aspects and flora and fauna monitoring. As mentioned, Colombian Mines also carries out periodic environmental auditing of drilling activities through an independent consultant to make sure all environmental requirements within the granted permits are followed.
As part of the development of the HSEC Policy, a monitoring, inspection and audit program will be developed together with key performance indicators (KPIs) to track information on environmental, health and safety and social management, training, incidents and spills, etc. The Company will also develop an Environmental Monitoring Plan to formalize monitoring requirements for this phase of work.
Community Investment:
Colombian Mines has in place a community investment plan (Plan de Gestion Social) for the communities in the area of influence of the Project which includes a schedule to carry out stakeholder engagement activities and the identification and selection of community investment opportunities. To date, the Company has supported the local community of Lituania with a number of “quick-win” projects including support to the local school, church and medical center and activities related to road repairs.
Reporting:
As part of the environmental permit conditions, the Company submits an environmental report to the local and national offices of the Ministry of Environment and the Corporacion Autonoma del Valle del Cauca – CVC on a semi-annual basis. Reporting on health and safety issues to the government is only required for major accidents. The Ministry does not require reporting on land access (i.e. land take, number of land owners etc.).
As part of internal reporting, environmental management reports are prepared by the external advisor and include solid and liquid waste management, surface water monitoring, platform construction and housekeeping, etc. However, limited information on statistics and key performance indicators (KPIs) for ongoing tracking of performance is provided both on environmental and health and safety matters.
As part of IFC’s investment, Colombian Mines will submit an
Annual Environmental and Social Monitoring Report (AMR) to IFC to describe its environmental and social performance. As part of the Stakeholder Engagement Plan, the Company will also report regularly to local communities on the progress made on its activities and progress in implementing the Company’s Environmental and Social Action Plan.
Grievance Mechanism:
The Company does not currently have a Grievance Mechanism to receive and address concerns and claims from affected stakeholders. As part of IFC’s involvement, the Company will develop a formal Grievance Mechanism as part of its HSEC Policy to adequately receive, investigate and respond to stakeholder claims and concerns (Action 1 of the ESAP).
To date, the exploration campaign at El Dovio has included the building of 3 platforms and the drilling of 10 holes. Drilling equipment is transported to the platforms by foot and horse and using existing trails. There is currently no vehicular access to the drilling platforms. To support current activities, a two-room base camp has been built approximately 200 meters from the drill sites.
During exploration work, potential impacts from Colombian Mines’ activities to surface and ground water, soil and air are limited and can be adequately managed through the establishment of the necessary EHS practices. From a walk-through within the camp and the drilling areas, good housekeeping was observed with some opportunities for improvements on EHS aspects as noted below.
PS 3 Resource Efficiency and Pollution Prevention related issues
Solid and Liquid Waste:
Colombian Mines generates minimal amounts of solid waste mainly from the camp and from the drilling sites. Waste is collected in plastic containers at the camp and in plastic bags at each drill site and transported to the town of Lituania where a registered waste company transports these wastes to a waste disposal facility located at the Town of El Dovio. The Company does make an effort of segregating waste on site and will do additional efforts to minimize the amounts of waste generated and disposed of by reuse and recycling of materials as much as possible.
Hazardous waste generated at the camp and drill sites is minimal and consisting mainly of spent rags and oil products. Hazardous waste is currently collected on site and transported to the Town of Lituania from where it is transported by a licensed hazardous waste transportation company (Ecologistica) to a secure landfill in Medellin.
Regarding sanitary liquid waste generated at the camp, this is directed to a septic system approved by the local authorities within the boundaries of the camp.
Water Quality and Use:
Water for drilling activities is currently obtained from a spring (Quebrada La Soberana) located within the Concession and transported to the drilling platforms through pipes. The Company has obtained a water extraction permit from the environmental agency (Corporacion Autonoma del Va
lle del Cauca – CVC) for the extraction of a maximum of 1.43 liters/second. This Permit includes a series of environmental management requirements to follow during exploration activities. At the drill sites, used water from the drilling activities is temporarily stored in a series of tanks to allow for solids to settle and then recycled in the drilling process. Also, drilling activities use biodegradable drilling muds to avoid impacts on surface and/or ground water resources.
Water for the camp is obtained from the same spring (Quebrada La Soberana) and transported via pipe.
As part of its current monitoring program, the Company carries out daily flow measurements in four (4) water streams near the current exploration activities as well as a bi-annual sampling and monitoring of physical, chemical and biological parameters. The project is in early exploration stage but, once baseline studies begin as part of any future ESIA process, the Company will develop a participatory surface water monitoring program to involve key stakeholders (including local communities) in the process and maintain these stakeholders informed of water quality and quantity trends as the project moves forward (See Action 1 of the ESAP).
Restoration and Re-vegetation:
Restoration and re-vegetation of drill pads at El Dovio is carried out at all sites following the completion of work. This process includes the protection of topsoil during platform construction, restoration of the land form to the original condition and the planting of species of grasses to aid the natural re-vegetation process. As part of the HSEC Policy, the Company will develop an Erosion Control and Revegetation Plan to formalize existing practices for minimizing the footprint of disturbed areas, establishing preventative erosion control measures and establishing effective re-vegetation practices of disturbed areas.
Management of Hazardous Materials (Fuel):
Fuel is stored in several plastic containers (of 6.5 gallons each) which are provided with secondary containment and covered to protect them from the rain. Signage is also installed as well as a fire extinguisher in case of emergencies. As part of the HSEC Policy, the Company will develop a Pollution Prevention Plan to set specific procedures for the storage and handling of fuel products and requirements in case of accidental spills.
Energy Use:
Current supply of energy for the camp is via a small diesel generator (2.9 KW). The estimated consumption of fuel for maintenance of the camp is about 5 gallons per day. During drilling activities, energy is also supplied via diesel generators at each location.
Noise:
Current noise generated from exploration activities is limited with the distance to any households or single potential receptors (such as local land owners) being several hundred meters to several kilometers away. At the drill sites, drilling operators and helpers are required to use hearing protection in
areas of high noise levels.
Emergency Preparedness and Response:
As part of IFC’s investment, Colombian Mines will develop a robust Emergency Response Plan (ERP) outlining emergency scenarios and response actions, key contacts and responsible staff. The Company will also conduct training to employees and contractors on the information within this Plan.
Management of Contractors:
For the recent drilling activities at El Dovio, the Company hired a Canadian/Colombian drilling company (MPX). Drilling equipment and drilling crews are the responsibility of the contractor as well as the management of EHS aspects at the drilling locations. As part of the development of its HSEC Policy, Colombian Mines will standardize drilling contracts and ESHS requirements within these contracts to provide clarity on the obligations of the contractors in this regard.
PS 4 Community Health, Safety & Security related issues
Community Health and Safety:
The drilling operations at El Dovio are located in the Vereda of Sabana Blanca, Corregimiento of Lituania. Sabana Blanca has a population of 44 people and Lituania has a population of 241 people. The closest village to the exploration activities is Lituania located approximately 8 km from the base camp.
During exploration work, potential impacts from Colombian Mines’ activities to surface and ground water, soil and air and, subsequently to human health, are limited and can be adequately managed through the establishment of the necessary EHS practices. Access to the camp and the drilling sites is via road from EL Dovio for approximately 35 km to Lituania and then via foot trails for approximately 8 km. Although the potential risk of road incidents or accidents related to workers and to the local communities is relatively low, the HSEC Policy will address road safety and the management of risks from any increased transportation of materials and personnel from El Dovio to Lituania.
The drilling sites are located within forested areas, agricultural and/or grazing lands. The presence of vehicular traffic on the route of El Dovio to Lituania poses a potential safety risk to livestock browsing and grazing the land and to road users. To date, there have been no reported accidents. Colombian Mines does provide defensive driving training to its employees and will ensure that their contractors do the same. The drill sites are properly barricaded to ensure that livestock and people do not wander into the sites.
Security Personnel:
Colombian Mines does not employ any security personnel at the time. To date, there are no incidences involving local communities and/or any major security issues.
PS 5 Land Acquisition and Involuntary Resettlement related issues
Colombian Mines holds exploration rights for the El Dovio Concession located in the Corregimiento of Lituania, Municipality of El Dovio. The area is mostly characterized by forested areas and agricultural and grazing land
s. The majority of the users of the area hold customary rights to the land with some holding titles.
For its early exploration program (drill pads and small access roads), Colombian Mines acquires access rights from land owners for temporary use of farmlands and grazing areas for short durations of time. Temporary access is negotiated on a willing buyer-willing seller basis and Colombian Mines signs a written agreement with each land owner. Colombian Mines has established fixed rates for different project activities – drill platforms, access roads, trenches. For any standing crops, rates are negotiated based on current market prices.
In its agreement template currently used, Colombian Mines will include provisions for reinstatement and restoration, the duration of the drilling activities, rates for standing crops, and compensation for lost crops if the drilling activities extend into the next planting season, and details of a contact person for logging grievances.
The Company will develop a Land Use and Compensation Plan (LACP) to outline the principles, guidelines and approaches that will be followed for temporary land access and compensation activities in accordance with PS5 requirements. See Action 4 of the ESAP.
PS 7 Indigenous Peoples related issues
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The Yarumalito Concession is not located within any indigenous peoples (IP) lands. However, part of the El Dovio Concession (outside of the area subtracted and currently permitted for exploration) is located within legally titled land belonging to the Acadesan Afro Colombian Community (Comunidades Negras - as defined in Colombian legislation). A portion of the Mercedes Concession is located within lands belonging to the Tutira Bonanza, Natacoy Pijao and IMBA IP Communities. No sampling or reconnaissance has been carried out on lands belonging to the IP Communities. At Mercedes, the Company is planning on conducting systematic mapping and evaluation of the property exterior to the IP Communities in 2014, leading to drilling probably in early 2015.
Colombian legislation has a requirement of Prior Consultation “Consulta Previa” for projects located within Indigenous Peoples lands and collective territories of Afro-Colombian Peoples prior to development of a mining project (as part of the environmental licensing process) but not as part of the granting of the Concession or prior to carrying out exploration work. In spite of this, and in order to build a strong relationship with the IP communities near the Mercedes Concession, Colombian Mines has recently started a consultation process through the engagement of Fundeparamos, a consultant company experienced in these issues.
Any work by the Company within areas of the El Dovio Concession, belonging to Afro Colombian Peoples’ territories, and within the Mercedes Concession, belonging to indigenous peoples’ land, will need to follow the requirements of PS7 in relation to the level of engagement planning, disclosure of
information, consultation and participation with the affected communities. For this, the Company will develop a Corporate Indigenous Peoples (IP) Framework to guide engagement efforts in any of their concessions areas which overlap with Indigenous and Afro Colombian Peoples in line with PS7 requirements (See Action 7 of ESAP).h ♪
