IFC’s appraisal considered the environmental and social management planning process and documentation for the Project and gaps, if any, between these and IFC’s requirements. Where necessary, corrective measures, intended to close these gaps within a reasonable period of time, are summarized in the paragraphs that follow and (if applicable) in an agreed Environmental and Social Action Plan (ESAP). Through implementation of these measures, the Project is expected to be designed and operated in accordance with Performance Standards objectives.
In addition to the nationally required ESIA, the borrower commissioned additional study work and developed an E&S disclosure package consisting of a Project Disclosure Summary (including draft CIA), Assessment of Brine and Water Resources, Supplemental Socioeconomic Baseline and Impact Assessment (Puesteros), SEPs, CHA, Offset Conceptual Feasibility Study, CEMP, and Updated Mine Closure Plan to international requirements, including IFC PSs. Furthermore, given the project’s proximity to the Chilean border (approximately 30 km), the borrower completed a Transboundary Influence Assessment, which concluded that no material direct or indirect impacts are anticipated (summarized within the Project Disclosure Summary). The Project Disclosure Summary contains a summary of additional study work completed to align the project with IFC PSs, an updated risk assessment, and defines mitigation measures to be implemented to manage identified risks and impacts. The E&S disclosure package has been disclosed in IFC’s disclosure portal with the ESRS and ESAP of the project.
Construction and operations phase E&S management and monitoring responsibilities will be shared between the borrower and the project contractors. The sponsor has corporate-level E&S policies applicable to the project. The borrower has implemented an environmental and social management system (ESMS) appropriate to the current stage of the project, which will be further improved and refined in advance of subsequent phases of the project. A CEMP has been prepared outlining key mitigation measures identified in the ESIA. The CEMP defines sub-plans and procedures to be developed and implemented prior to the commencement of construction activities. Per ESAP#01, the borrower will further refine and implement its ESMS commensurate with the risks and impacts of the project per the requirements of IFC PS1 and local requirements. The ESMS will include an update to the project’s Regulatory Obligations Register, which will document all E&S obligations made by the borrower in the ESIA, the E&S disclosure package, and through acceptance of all regulatory conditions. The register will specify which entity (borrower, specific contractor, multiple contractors) is responsible for implementing each obligation. These obligations will be integrated into the to-be-developed sub-plans & procedures. The Construction Environmental Management Plan (CEMP) will be updated accordingly. The ESMS will also include the development of a Gender Risk Assessment and associated gender action plan to manage gender specific project risks and enhance gender opportunities.
Project contractors and sub-contractors are required to implement those portions of the borrower’s ESMS that fall within their scope of work. The borrower has established E&S clauses to be contained within construction and operations contractor contracts, which define mandatory E&S requirements. Per the E&S clauses, each contractor is required to develop and implement a Health, Safety, and Security Management Plan (HSSMP), Environmental Management Plan (EMP), and establish processes and procedures required to implement their scope of work aligned with the mandatory E&S requirements. Per ESAP#02, borrower will update its E&S clauses to require contractors and subcontractors to comply with IFC PSs, and E&S obligations defined in the Regulatory Obligations Register, as applicable to their scopes of work. Furthermore, the clauses will contain clear provisions related to labor standards and define labor monitoring expectations.
Before commencement of commercial operations, as per ESAP#03, the borrower will develop and implement an Operations Environment & Social Management Plan (OESMP) consistent with IFC PSs, national requirements, and all relevant E&S obligations. The borrower will require its operations contractors to develop and implement plans aligned with the OESMP and applicable to its scope of work.
Cumulative impacts related to the project were assessed in the ESIA. There is currently only one additional mining company operating in the salar (Puna mining, which borders the borrower’s southern concession boundary south of the borrower’s concession). Potential cumulative impacts identified in the ESIA include impacts on groundwater resources and social dynamics. The borrower is developing a CIA aligned with IFC PS requirements, incorporating information collected during supplemental studies and monitoring (which will be disclosed). In parallel, the borrower will foster and promote the establishment of a CI forum involving other mining companies to review cumulative impacts in the salar and explore collaborative approaches towards collective E&S management of risks and impacts.
At the project level, the borrower has split E&S responsibilities across three departments, including a Communities and Social Performance (CSP) department, an HSSE Department, and a Permitting & Biodiversity Department. Each department is led by a manager and includes discipline-specific coordinators, specialists, and advisors/technicians. The HSSE department includes medical and emergency response personnel. The borrower also utilizes external and specialized consultants (biodiversity and other experts) as required, for additional support. The borrower will engage suitably qualified and experienced site-based E&S resources and require its construction contractor/subcontractors to appoint adequate E&S resources to ensure oversight of their activities.
As part of the borrower’s ESMS (ESAP#1), the borrower will develop and implement a fit-for-purpose Community Emergency Response and Preparedness Plan (CERPP), which will incorporate preparedness and response procedures for emergency scenarios, interface points with local and regional emergency services, and mechanisms to communicate with external stakeholders, including local communities and Puesteros in the event of an emergency.
The borrower has a well-established system for HSSE monitoring and review at different levels of the organization and the project. Legal obligations are monitored through the Regulatory Obligations Register, and the CEMP defines E&S monitoring requirements in accordance with the commitments defined in the ESIA. Per ESAP#04, the borrower will update and further refine its E&S Monitoring Program (E&S MP), which will define monitoring requirements (including those established in the E&S Disclosure Package) throughout the project’s lifecycle. The E&S MP will define monitoring locations, parameters, frequencies, etc., which will be regularly reviewed and adjusted as required. The E&S MP will establish ‘Trigger, Alert and Response Plans’ (TARP's) for sensitive components, including groundwater, surface waters, key biodiversity components, and priority ecosystem services, defining conditions that activate an alert, alert values thresholds, and response plans that outline the actions to be taken when an alert is triggered.
PS 2 – Labor and Working Conditions
As of March 2025, the borrower employed 1,719 workers for the Rincon 3000. Of these, 262 are direct employees, and 1,457 contractors. Women represent 30% of direct employees and 13% of contractors, and unionized workers represent 20% of the direct workforce and 92% of contractors. During peak construction, the project expects to employ during peak of construction an estimated 4,200 workers (1400 direct workers, 1300 temporary, and 1500 third-party workers) besides 225 workers to operate the 3,000 tons per year pilot plant. The workforce requirements during operations is anticipated to be approximately 460 workers from 2029. The bulk of the construction and operations workforce is expected to be recruited from the local area, which includes the communities in the direct and indirect area of influence, as well as Salta, the provincial capital. Argentinian labor law requires 70% local participation, which will be achieved by the borrower through capacity building and training programs.
Argentina has ratified the ILO standards, which are incorporated into the national labor laws, which forbid forced and child labor. The borrower does not employ anyone under the age of 18 years, and the employee’s age is verified and recorded during the recruitment process. The borrower has established project-level human resource (HR) policies and procedures aligned with its collective bargaining agreements, which, in most aspects, offer conditions above national labor law. In addition, the borrower has developed and is implementing a Code of Conduct, ‘The Way We Work’, which is applicable to all project workers (including contractors and sub-contractors) and a Supplier Code of Conduct, which defines their commitment to rejecting child and forced labor, any form of discrimination, harassment, abuse or violence, and respecting equal opportunities.
As per ESAP#05, the borrower will prepare a ‘Worker Handbook’ for its employees, outlining key information on general employment terms and conditions, collective agreements, worker associations, retrenchment procedures, non-discrimination policies, and other relevant matters. In addition, the borrower will require all contractors engaging project workers to produce their own ‘Worker Handbook’ that is consistent with and aligned to the borrower’s handbook.. As per ESAP#2, the borrower will update its E&S clauses contained in contractors’ (and subcontractor) contracts to require compliance with IFC PS2. Furthermore, the borrower will enhance its management of third-party workers by establishing a procedure defining its approach to managing, providing oversight of, and monitoring project contractors' and subcontractors' compliance with local labor laws, IFC PS2, and consistent with the general principles described within IFC Good Practice Note: Managing Contractors' Environmental and Social Performance (ESAP#06).
Project workers will be accommodated in camp facilities, which will be constructed to meet the requirements defined in IFC's and EBRD's Good Practice Note on Workers' accommodation. Third-party workers will be offered the same accommodation as the borrowers’ employees..
The borrower has established a worker grievance mechanism (WGM), ‘MyVoice,’ generally aligned with IFC PS2. This mechanism is open to all workers, irrespective of their employer, and has the option of submitting anonymous grievances. The WGM is designed for all types of grievances, including bullying, harassment, and any form of discrimination. An independent corporate-level team, CareHub, supports workers who have been impacted by harmful behaviors such as bullying, harassment, GBV, racism, and discrimination. Care Hub supplements MyVoice by providing additional channels to raise concerns, providing a pathway to resolve reports of harmful behavior via early intervention, non-investigative resolution options and/or formal investigation and consent-based referrals to experts. Other grievances or concerns can be registered through different channels, including online, designated phone line, email, and/or with members of Ethics & Compliance or Legal, who, as appropriate, will escalate the matter to the Business Conduct Office. Cases related to payroll are communicated to HR, and specific grievances related to accommodation camps have a specific QR code. In addition, the borrower implements employee surveys to assess satisfaction and concerns twice per year.
Despite well-established mechanisms being in place, improvements are required to improve accessibility and compatibility with the social context of the project. As per ESAP#07, the borrower will establish a more accessible, confidential first contact point for worker-related grievances and develop procedures to connect corporate-level mechanisms, such as My Voice and CareHub, with the site-level system. The borrower will tailor the referral pathway of CareHub to the project’s operational context with a gender responsive and survivor-centered approach implemented by trained personnel, ensuring accessibility for both direct employees and third-party workers. Furthermore, the borrower will develop and implement a communication and training program on the grievance mechanism for staff, third-party workers, and management.
PS 3 - Resources Efficiency and Pollution Prevention
During its first year of operations of stage 1 of the project (25 kt per annum), it is estimated that 111 kt of CO2e emissions (scope 1 and 2) will be generated. Once at full capacity and with stages 1 and 2 completed, the project will generate 222 kt of CO2e emissions per annum. Power will be sourced from the national grid via two new 33kV transmission lines. The borrower has completed an alternatives analysis assessing options for acquiring lower carbon-intense energy, and based on this analysis, plans to enter into an off-site power-purchase agreement to secure adequate renewable energy to supply the project from 2030.
The project will install wellfields in the salar to extract lithium-bearing brine. Processing of the lithium-rich brine will require a raw water supply to be sourced from the Catua Alluvial Fan. Due to its high salinity, the extracted raw water is not suitable for lithium processing, irrigation, cattle, or human consumption without passing through an industrial pre-treatment process. A reverse osmosis modular plant will be installed for pre-treatment. Water will be recirculated within the industrial process, and the extraction and purification process has been designed to minimize raw water consumption. There are no other users of Catua Alluvial Fan water downstream from the project’s wellfield.
The Rincon Basin comprises a closed drainage basin that is drained by eight different sub-catchments. There are three main streams in the northern part of the basin, which flow either across or adjacent to the Catua Alluvial Fan. Water in these three streams infiltrates into the underlying Catua Alluvial Fan. In addition to these three streams, there are various small springs, lagoons, and vegas (a type of wetland) within the Rincon Basin. Along the western margin of the salar nucleus, there are a number of vegas, including Vega Rincon, Vega Unquillar, and Vega Saladillo. Vega Rincon is fed by a spring with high-quality water, which emerges from the slopes (alluvial fan) to the west of the vega. The Rincon Lagoon is a perennial water body of brackish water that exists along the western margin of the salar nucleus and is of high ecological value. Two Ojos de Agua (water eyes) were identified on the western margin of the proposed SBDF. EMEs exist within these Ojos de Agua and in some lagoons, and as such, they are considered critical biodiversity features (refer to PS6 section). Recent site investigations completed by the borrower in the vicinity of various vegas, lagoons, and puesteros hand dug wells (“ajibes”) that collect surface runoff water around the margin of the Salar suggest that these features are possibly hydraulically disconnected from the underlying brines. This hydraulic disconnection is supported by the presence of a shallow clay layer, artesian/confined groundwater conditions underlying the clay layer, and different water quality between shallow and deeper sediments.
The borrower has developed a conceptual hydrogeological model and subsequent numerical groundwater flow model for the Rincon Basin, based on a robust dataset consisting of more than 150 wells, pumping tests, and a long-term monitoring program. Although some uncertainties remain related to predicted drawdowns of the brine aquifer, the model will be progressively updated, based on the borrower’s ongoing monitoring program planned field investigations.
While there are many potentially sensitive environmental receptors across the Rincon Basin, only a small number of these receptors were identified as potentially being impacted by project activities, as they are located either beyond the water-related area of influence or are likely hydraulically isolated from the water/brine resources from which the project’s raw water and lithium brine will be extracted. While the borrowers' investigations/assessments completed to date suggest a potential hydraulic separation between most key environmental receptors and the deeper brine systems being pumped (reducing/removing the potential risk of impact), the project has adopted a preventive approach and has defined a range of potential mitigants (including brine re-injection, physical hydraulic barriers, surface irrigation, change of the SBDF design, relocation of brine abstraction wells), should impacts be identified by the borrower’s monitoring program, or identified via future study work/modelling updates. The borrower has successfully completed a first two phases of pilot injection field trials, with a series of additional, larger-scale and deeper re-injection pilot trials currently being executed. As per ESAP#08, the borrower will commission an assessment for each of the identified potential mitigation measures, confirming their viability, permitting requirements (for their implementation), and providing a cost estimate. Should the mitigation measures be deemed unfeasible, the borrower will propose alternate measures. In addition, the borrower will complete numerical groundwater simulations to demonstrate the possibility of brine reinjection during operations to avoid post-closure water-table drawdown at the Ojos de Agua. (ESAP#09). Furthermore, the borrower has developed a draft Adaptive Water Management Plan (AWMP), which defines adaptive management measures that can be implemented when/if required, in response to circumstances or events that are predicted or not fully expected based on the borrower’s existing assessment. The AWMP will be periodically updated, based on further understanding of the EMEs and latest monitoring data.
The project's two main waste streams include filtered waste residues of calcium carbonate and magnesium hydroxide (resulting from the precipitation stage of the process) and spent brine (resulting from the lithium adsorption phase). Approximately 5.5 Ktpa of filtered waste will be generated annually, which will be disposed of within a fit-for-purpose permanent disposal facility (known as a Filtered Waste Storage Facility (FWSF)). The FWSF is currently designed as a lined (with HDPE geomembrane) 16 ha pond comprised of one cell with a maximum height of 7 meters. Approximately 27.8 million m3 of spent brine (3,700 m3 per hour) will be produced per annum and stored within an SBDF. The SBDF will be a partially lined, notably to protect the embankment, 2,400 ha containment facility, consisting of two cells, designed to evaporate and infiltrate spent brine and backwash solutions without hazardous contaminants. Spent brine is considered non-hazardous waste per Argentinean regulations. Spent brine will not contain any foreign chemicals that modify its physical and chemical characteristics in comparison to natural brine (with the only two notable differences between the spent brine and natural brine being approximately 21% reduction in the total dissolved solids (TDS) content due to dilution in raw water, and a ten times lower concentration of lithium).
Other non-hazardous and hazardous wastes will be transported to authorized recycling and disposal facilities off-site. Domestic effluents will be treated prior to disposal via infiltration fields. As part of its ESMS, the borrower has developed a Waste Management Plan for the project aligned with local legal requirements, IFC PS3, and WBG EHS general guidelines.
The project will use some hazardous substances as part of the lithium recovery process, including soda ash, sodium hydroxide, hydrochloric acid, and sulphuric acid. Hazardous substances will be handled per the borrower's hazardous materials procedures and management plans, which follow local regulations and good international industry practice as well. These define OHS and environmental provisions for the safe transportation, handling, storage, and use of hazardous materials, including emergency response.
PS 4 - Community Health, Safety, and Security
During the ESIA process, risks and impacts to communities and the public were assessed. As indicated in ESAP#01, the borrower will develop a Community Health, Safety, and Security Management Plan (CHSSMP) designed to manage such risks and impacts effectively. Additionally, a project-level EPRP will be developed, incorporating risks to the health and safety of the affected communities and other stakeholders.
Risks related to transport were assessed by the borrower’s social impact assessment, which identified a non-material increase in traffic during construction and operations. During operations, freight transport will involve the import of several hazardous materials, including Na2CO3, NaOH, H2SO4, and HCL, and the export of LC. The borrower has conducted a risk-based alternatives analysis of transportation options and assessed measures to minimize risks. As per ESAP#01, the borrowers' CHSMP will include an assessment of E&S risks associated with transport, including an analysis of all social receptors, and mitigation and monitoring measures to identify and reduce impacts to communities related to increased traffic (including risks related to the transport of hazardous goods, GBV, and sexual exploitation). The borrower will ensure ongoing community engagement activities are undertaken with all potentially impacted communities to inform and consult them of transportation risks, trucking schedules, and emergency response procedures.
Socio-economic changes and potential influx associated with the project may result in an increased risk of GBV within the workforce, and communities, and other adverse impacts on communities. As per ESAP#10, the borrower will develop and implement an influx management plan, aligned with IFC PSs, to monitor and mitigate influx and potential GBV-related impacts. The plan will consider i) awareness-raising activities for prevention and addressing GBV for community members, local authorities, and project workers; ii) monitoring procedures and KPIs to monitor impacts; and iii) survivor-centered grievance procedures, with mapped referral pathways to local GBV specialized services.
Security services are currently outsourced to an authorized third-party company. Security personnel are unarmed and receive training on the Voluntary Principles on Security and Human Rights (VPSHR) and must comply with the Sponsor's code of conduct and Security Standard. As per ESAP#11, the borrower will revise its existing security risk assessments to identify potential risks posed by the project’s security arrangements on internal and external stakeholders. Based on the assessment, the borrower will develop and implement a Security Forces Management Plan (SFMP) for managing private security forces aligned with national requirements, IFC PS4, and VPSHR. The SFMP will include security selection/evaluation procedures and a security code of conduct to guide the interactions between security personnel, workers, and community members. Furthermore, the SFMP will include provisions for systematic training regarding GBV, human rights, and the use of force, and formal procedures for reporting, responding to, and documenting security incidents, which will be communicated to relevant stakeholders. The project's community grievance mechanism will be available for members of the community or employees in the event of a violation of the code for security personnel or other grievances related to security (including trucking and other community security concerns). Furthermore, the borrower will work with the provincial and federal governments in order to establish a formal Memorandum of Understanding with the Argentinian security forces aligned with IFC PS4.
PS5 - Land Acquisition and Involuntary Resettlement
The mining concession (approximately 81,000 hectares) was initially granted in 2001 and acquired by the borrower in 2022. The land is owned by the Province of Salta with easement rights granted by the Salta mining authorities.
There are three communities of Indigenous Peoples within the project area of influence: the Kolla in Olacapato and Estación Salar de Pocitos, officially recognized in 2009, and the Coquena Atacama in Catua, recognized in 2002. While the Coquena Atacama in Catua have legal title to their territory there is no overlap of their land with the project’s concession area.
In 2022 and 2023 through resolutions 152/2022 and 132/2023, the National Institute of Indigenous Matters (Instituto Nacional de Asuntos Indígenas "INAI") together with the Ministry of Aboriginal Matters of Salta granted Olacapato (approximately 208,706 ha) and Estación Salar de Pocitos (approximately 246,960ha) surface user rights for a territory that overlaps with the concession area. The surface user rights allow for traditional use such as herding and do not constitute a legal title or ownership over the land.
The Indigenous Peoples of Estación Salar de Pocitos and Olacapto can continue using the surface areas within the mining concession for their traditional activities. Although there is overlap between the mining concession area and the traditionally recognized land, the size of the physical infrastructure of the project is about 3,300 ha, and will occupy only 1.8 % of the total territory recognized by INAI for the Indigenous Community of Olacapato and 1.3% for the Indigenous Community of Estación Salar de Pocitos. In line with Argentine laws and regulations, including the ILO Convention 169/1989, approved by the Argentine national Congress in 1992 by Law 24,071, provide that any impact causing damage to Indigenous Peoples must be fully compensated and considering that these communities have surface user rights and do not own the land, compensation will be provided for loss of any assets and livelihoods.
In order to assess potential impacts on the Indigenous communities of Olacapato and Estación Salar de Estación Salar de Pocitos, the borrower conducted a socio-economic baseline survey of all land users within the concession and the DAI. The baseline identified 55 families actively herding llamas, goats, and sheep (most of these families are from Catua (37) and, to a lesser extent, from Olacapato (12) and Estación Salar de Pocitos (6)) owning a total of 153 ‘puestos’, of which 103 are actively used, and 26 active urban and rural pens. The baseline identified that the land users of Catua owned a total of 3763 llamas, goats, and sheep, Olacapato land users owned 533, and Estación Salar de Pocitos land users owned 632. The baseline mapped seasonal pasture areas and water sources used for livestock. Livelihood activities identified included two active mining quarries, the collection of medicinal plants, firewood, and other economic activities.
The social impact assessment identified that no economic activities by the communities of Pocitos and Olacapato will be impacted. Only one herder from Catua who conducts herding activities outside of their territory within the mining concession near planned project infrastructure could be directly impacted on livelihood activities by the project. The herder's area of use will be reduced by approximately 1.2%, with impacts related to changes in livestock roaming habits, which may require the herder to cover larger areas to herd the livestock. Although the potential impact is small, the herder has been identified as vulnerable as per IFC PSs, a factor that will be considered when determining mitigation and compensation measures. The borrower's Puestero Management Plan includes a framework livelihood restoration plan aligned with PS5 applicable to any impacts to livelihoods identified now or through future monitoring. In addition, the Puestero Management Plan includes the outline for a technical assistance program to preserve and strengthen traditional livelihood practices for the benefit of all indigenous communities within the project's direct area of influence. The program will be developed in consultation with the indigenous communities.
As per ESAP#12, the borrower will develop and implement a livelihood restoration plan aligned with IFC PS5. Furthermore, as an integrated part of the E&S monitoring program (ESAP#04), the borrower will conduct regular monitoring of all water bodies that provide ecosystem services to communities within the DIA. If impacts on ecosystem services are identified, the LRP framework will be applied to the affected people/communities.
PS 6 – Biodiversity Conservation and Sustainable Management of Living Natural Resources
The project is located in the Salar del Rincon hydrographic basin, in the Central Andean dry puna ecoregion. All project components are located within an LPA, the Los Andes Nature Wildlife Reserve. The LPA was established to protect several priority biodiversity values and defines features that are to be considered untouchable areas. Among these are Extremophile Microbial Ecosystems associated with water features, such as lagoons and ojos de aguas.
The Salar del Rincon basin hosts priority biodiversity values that are restricted range and meet Critical Habitat thresholds: Liolaemus spp and Extremophile Microbial Ecosystems. There are also several Natural Habitat values that are associated with vegas and lagoons that surround the salar, including: the Vicuña (Vicugna vicugna, IUCN RedList – Least Concern), Guanaco (Lama guanicoe, IUCN RedList – Least Concern), Horned coot (Fulica cornuta, IUCN RedList Near Threatened), Andean Flamigo (Phoenicoparrus andinus, IUCN RedList Vulnerable), Puna Flamingo (Phoenicoparrus jamesi, IUCN RedList Near Threatened), Lesser Rhea (Rhea pennata, Least Concern IUCN RedList); and species not strictly associated with these water features, such has endemic flora spp, other Liolaemus species and the Andean Condor (Vultur gryphus, IUCN RedList Vulnerable). The borrower has carried out baseline studies to comply with national law, and additional focused surveys on priority biodiversity values, informed by consultation and with the support of various species experts. Additional surveys and assessments are underway to better understand Liolaemus taxonomy and distribution, as well as to further characterize the EMEs.
The placement of project infrastructure (including processing facilities, the SBDF, etc.) will result in direct impacts (through conversion) on approximately 380 hectares of Critical/Natural Habitat that sustain priority biodiversity values. These impacts will occur predominantly in areas covered by grassland, shrub steppe, and rocky areas. Risks to priority biodiversity values are associated with the withdrawal of brine, which may lead to impacts on water features, collision risk for birds due to the new transmission lines, and collision risk with vehicles for strictly terrestrial species. The project’s infrastructure was situated to avoid direct impacts on areas where EMEs are located, as well as other water features. The project will relocate fauna before the commencement of land clearing and groundworks, especially Liolaemus lizards and endemic flora species, in line with IUCN Guidelines for Reintroductions and Other Conservation Translocations (2013) and informed by species experts. To minimize the risk of collision on bird species using the airspace that are subject to NNL objectives, mitigation measures will be implemented along the OHTLs using best available technology (i.e., bird flight diverters) (ESAP#13). Per ESAP#14, the borrower will develop and implement a post-construction fatality monitoring program based on Good International Industry Practice.
As described in PS1, the project will adopt an E&S Monitoring Program to identify impacts on water features important for biodiversity, including the development of ‘Trigger, Alert and Response Plans’ (TARP's). This adaptive management approach defines potential mitigation measures (as described in PS3) if adverse impacts are identified on biodiversity values/key features exceeding pre-defined threshold values. The borrower aims to have no residual impacts for EMEs and water features, as per the conditions stipulated by the national environmental authorities. Residual impacts on Natural Habitat and other Critical Habitat values (i.e., Liolaemus spp.) will be addressed through an offset. To ensure that the project will comply with NNL and NG requirements, the borrower will develop and implement a Biodiversity Management and Monitoring Plan (ESAP#15) that defines all mitigation measures for construction and operations, and details monitoring activities to evaluate the effectiveness of such measures. A Biodiversity Action Plan (BAP) (ESAP #16) will also be developed to define the borrower’s strategy to address residual impacts in order to achieve NNL for Natural Habitat values, and NG for Critical Habitat values. The BAP will define, based on consultation with relevant stakeholders, Additional Conservation Actions for EMEs and for enhancing the conservation of the Los Andes Reserve. The borrower has developed an offset concept study that outlines options to mitigate residual impacts and will develop and implement an Offset Management Plan in consultation with relevant stakeholders as part of the Biodiversity Action Plan (ESAP#17).
The borrower has conducted a review of priority Ecosystem Services, based on baseline data and consultation. Water, livestock grazing land, firewood collected for domestic use, collecting plants for medicinal and ceremonial purposes, habitats for wildlife, and sites of scientific interest (EMEs) have been identified as priorities. Mitigation measures (including compensation) and monitoring requirements are described under PS3 (water-related), PS5 (Puestero Management Plan), and PS6 (habitats-related).
PS 7 – Indigenous Peoples
Within the project's DAI, there are three communities of Indigenous Peoples: the Kolla in Olacapato and Salar de Pocitos, officially recognized in 2009, and the Coquena in Catua, recognized in 2002. These communities are registered in the National Registry of Indigenous Communities (ReNaCI) and legally recognized by the National Institute of Indigenous Affairs (INAI). The current community leaders (caciques) are women in all three communities. While Catua has legal title to their territory, there is no overlap of their land with the project’s concession area. The Indigenous communities of Estación Salar de Pocitos and Olacapato have surface user rights to the land rather than title, as explained in the PS5 section above.
Since the project will impact land over which the Indigenous Peoples of Olacapato and Estación Salar de Pocitos have surface user rights and may result in impacts on a limited amount of livelihood activities for one herder from the Indigenous Peoples of Catua, the requirement for Free Prior and Informed Consent (FPIC) as per PS7 applies. The borrower is in the process of implementing a process of FPIC in line with PS7 and in line with their engagement policy. The borrower has engaged a specialized third party to conduct capacity building on FPIC for each of the three communities. Communities expect to participate in and benefit from the project through employment and procurement opportunities. Early management of expectations and an outline of ways to enhance participation through capacity building will be crucial for maintaining a constructive relationship with the communities in the area of influence.
As part of the FPIC process, a Framework Agreement was developed outlining the rules of engagement, including commitments to the establishment of dialogue roundtables, recognition of collective rights, technical and financial support, and conflict resolution mechanisms. Agreements have been signed with Coquena Indigenous community of Catua and the Kolla Salar de Pocitos in February 2025. The agreement with Kolla Indigenous Peoples of Olacapato is pending. The borrower will finalize the FPIC process in accordance with PS7's requirements (before the commencement of construction activities that may impact IPs) and consult on all new assessments related to project impacts.
As per ESAP#17, the borrower will develop and implement an Indigenous Peoples Plan (IPP), aligned with IFC P7. The IPP will outline the borrower's commitment to conducting ongoing, culturally appropriate engagement as part of the FPIC process and outline monitoring processes for continuous evaluation of the implementation of the IPP.
