EQUATOR PRINCIPLES COMPLIANCE FOR UNDERSEA CABLE SYSTEMS FOR - PowerPoint PPT Presentation

conference & convention enabling the next generation of networks & services EQUATOR PRINCIPLES COMPLIANCE FOR UNDERSEA CABLE SYSTEMS FOR UNDERSEA CABLE SYSTEMS Neil Daetwyler ENVIRON

conference & convention enabling the next generation of networks & services Presenter Profile Mr. Daetwyler is a Principal of ENVIRON. He has 35 years of professional experience and specialises in project management, principally for the environmental and social aspects of complex international lender-financed international lender-financed projects. He spent almost ten years as an engineering geologist in the UK, Europe, Africa and Asia Pacific before focusing on environmental consulting and project management. Neil Daetwyler CEng CPEng CEnv As an environmental consultant, he has lived and worked in Australia, Principal Malaysia, Singapore and the USA. He Email: ndaetwyler@environcorp.com currently resides in the UK and works Tel: (+44) 207 478 9800 internationally. Mobile Tel: (+44) 7841 277883

conference & convention enabling the next generation of networks & services What are the Equator Principles? The Equator Principles (EP) represent a financial industry benchmark for determining, assessing and managing social & environmental risk in project financing (www.equator-principles.com). The Principles are based on an external and respected benchmark, namely key elements of the Environmental and Social Review Procedures of the International Finance Corporation (IFC), the private- sector lending arm of the World Bank Group.

conference & convention enabling the next generation of networks & services Why are the Equator Principles important for the cable industry? Large submarine cable system projects are increasingly looking to external financing, rather than relying solely on internal funding by project shareholders. shareholders. Most of the International Finance Institutions (IFIs) involved with project financing have adopted the Principles (and are referred to as Equator Principles Financial Institutions or EPFIs).

conference & convention enabling the next generation of networks & services What if external financiers are not EPFIs? As a result of loan syndication, even IFIs that are not formally committed to the Equator Principles usually require EP compliance by the projects to which they lend. lend. The social and environmental standards that underpin the EP have been widely used or adapted by financial institutions other than the EPFIs. Multi-lateral lenders (such as IDB, ADB, AfDB and EBRD) and ECAs require compliance with IFC standards or similar.

conference & convention enabling the next generation of networks & services What does Equator Principles compliance involve? There are 10 Principles, the key requirements of which are: � An appropriate level of social and environmental � An appropriate level of social and environmental assessment (to international standards) based on the EP classification. � Compliance with social and environmental standards (either those of the IFC or national standards meeting or exceeding those of the IFC). � Specific requirements relating to issues such as Social and Environmental Management Systems; Consultation and Disclosure; Grievance Mechanism; and Independent Review.

conference & convention enabling the next generation of networks & services SEACOM – an Equator Principles Case Study The SEACOM cable system connects South Africa with Place Image India and Europe via Here landings in Mozambique, Tanzania, Kenya, Djibouti, India and Egypt, is privately- owned, and is funded in part by project finance arranged through commercial banks. As a result the project is subject to the Equator Principles

conference & convention enabling the next generation of networks & services SEACOM – an Equator Principles Case Study Despite the fact that the project includes cable landings in or close to highly sensitive locations: � a UNESCO World Heritage area (Ft. Jesus, Kenya); and � a national Nature Reserve (Umlalazi, South Africa) it was possible to have the project classified ‘B’ in respect of the Equator Principles.

conference & convention enabling the next generation of networks & services SEACOM – landing the cable adjacent to a World Heritage site The cable landing site adjacent to the 16 th century Fort 16 th century Fort Jesus World Heritage site has been carefully constructed and reinstated

conference & convention enabling the next generation of networks & services SEACOM – landing the cable adjacent to a World Heritage site ... and considerable effort is being effort is being made to render the finished cable station compatible with its historic surroundings.

conference & convention enabling the next generation of networks & services SEACOM – landing the cable in a Nature Reserve SEACOM imported specialised Horizontal Directional Drilling (HDD) equipment to South Africa and successfully installed the cable duct in a directionally- drilled borehole

conference & convention enabling the next generation of networks & services SEACOM – landing the cable in a Nature Reserve ...without disturbing the disturbing the wildlife in the Reserve.

conference & convention enabling the next generation of networks & services Conclusions 1. The application of the Equator Principles requires compliance with international standards for social and environmental performance, in addition to those typically required by national regulators. 2. Minimising the cost and time impacts of Equator Principles 2. Minimising the cost and time impacts of Equator Principles compliance requires careful project planning, particularly in respect of cable routing and the siting of terrestrial infrastructure such as beach manholes and cable stations. 3. Avoidance is the preferred option in relation to sensitive resources (whether social or environmental). Nevertheless, cable systems can be located in highly sensitive areas provided that the rationale behind the routing and siting choices is carefully considered and adequately communicated to both regulators and the wider community

conference & convention enabling the next generation of networks & services Conclusions 4. EP compliance is often treated by project developers as a separate consideration to national environmental clearance processes, and is often addressed late in project design and planning. Early integration of EP processes has the potential to both minimise costs and save time. to both minimise costs and save time. 5. Project developers should be aware that the requirements of the EP extend beyond social and environmental assessments (e.g. Labour standards, SEMS). 6. Major sub-sea cable systems are unusual (perhaps unique) in project finance in that they typically impinge on areas that are outside of national jurisdictions. This may lead to a requirement for an EP EIA, covering the system as a whole, in addition to national EIAs.

conference & convention enabling the next generation of networks & services Conclusions The SEACOM project is an example where it was possible to achieve an EP classification significantly less onerous than those required by some of the landing country environmental regulators. Despite the fact that the SEACOM project includes cable Despite the fact that the SEACOM project includes cable landings immediately adjacent to a World Heritage area and a national Nature Reserve it was possible to have the project classified ‘B’ in respect of the EP. However, achieving this type of pragmatic EP classification outcome requires advocacy on the part of the developer, by way of a carefully and cogently argued recommendation to the lenders.

2010 conference & convention enabling the next generation of networks & services The 7th International Conference & Convention on Undersea Telecommunications Pacifico Convention Plaza Yokohama & InterContinental The Grand Yokohama 11 ~ 14 May 2010 www.suboptic.org