THE UNITED REPUBLIC OF TANZANIA

MINISTRY OF ENERGY AND MINERALS

ENVIRONMENTAL AND SOCIAL MANAGEMENT FRAMEWORK

AND

INITIAL SCOPING STUDY FOR THE STRATEGIC ENVIRONMENTAL AND SOCIAL ASSESSMENT

FOR

THE SUSTAINABLE MANAGEMENT OF MINERAL RESOURCES PROJECT (SMMRP)

Prepared by:

Centre for Energy, Environment, Science & Technology (CEEST)

P. O. Box 5511, Dar es Salaam, Tanzania

Tel: 255-22-2667569,

E-Mail: ,

APRIL 2009

i

Executive Summary

This report presents an Environmental and Social Management Framework (ESMF) (PART – I) and an Initial Scoping Study for the Strategic Environmental and Social Assessment (SESA) (PART – II) for the Sustainable Management of Mineral Resources Project (SMMRP) in Tanzania.

The SMMRP is a 5-year technical assistance project anticipated to begin in mid 2009. Development objective of the proposed project is to improve the socio-economic benefits of mining for Tanzania and Tanzanians, and also to improve Government capacity to manage the mineral sector and enhance local and foreign investments. The project has four components which are: a) Improving the Benefits of the Mineral Sector for Tanzania: Artisanal and Small-Scale Mining, Local Economic Development and Skills Development; b) Strengthening Governance and Transparency in Mining; c) Stimulating Mineral Sector Investment; and d) Project Coordination and Management. The principal SMMRP implementing agency is the Ministry of Energy and Minerals (MEM) through the Minerals Division and the Geological Survey of Tanzania (GST).

The project has been classified by the World Bank as Category B, as defined in the Bank’s Operational Policy 4.01 on Environmental Assessment. The basis for this rating is that the project consists largely of technical assistance activities that may have only limited adverse impacts; however, it could lead to positive environmental and social impacts by supporting changes in the policy and regulatory framework that are likely to encourage increased commercial scale mining and artisanal and small-scale mining (ASM) activities in the future.

Where project activities and locations are well known, the National Environment Policy (1997) and Environmental Impact Assessment & Audit Regulations of 2005 prescribe details of how an EIA can be conducted. In the case of the SMMRP, the precise location of proposed project activities is not known at this time. Therefore the potential social and environmental impacts of these project activities cannot be identified and assessed in the context of a traditional EIA. Instead, this ESMF provides mechanisms for ensuring that potential environmental and social impacts of the SMMRP are identified, assessed and mitigated as appropriate, through an environmental and social screening process. In this way the ESMF complements the national EIA process.

SMMRP has many positive impacts. Some of these include; improved livelihoods of the ASM; improved environmental and social conditions of the areas where SM operates; increased benefits of mining to the communities; creation of harmony between ASM, LSM and local governments; improved and better local skill base for the mineral sector; improved capacity to manage the mineral sector; improved transparency in the sector; improved geologic infrastructure of the country leading to increased investment in the medium to longer term; better public image of the mineral industry; improved inter-agency coordination and collaboration that would enhance social accountability, good governance, transparency and client satisfaction; improved capacity to manage and monitor environmental and social issues in the mineral sector; and an overall improved management of the mineral sector;

However, some of the anticipated negative impacts of the SMMRP include: potential for disputes and wastage of SMMRP resources if (a) poor selection criteria for location of SSM demonstration centres and trainees is undertaken, (b) selection criteria for granting of the assistance to SSM is not properly done, and (c) selection criteria for supporting districts to pilot mainstreaming of mining into e strategic development planning is not properly done. Other negative impacts include; potential for conflicts both environmental and social if stakeholders are not fully involved during SESA, benefit studies and overall implementation of the SMMRP; potential for safety, health and environmental problems if there will be poor management of the proposed TDUs operations; ineffective operations if poor matching of the TDU equipment with mineral commodity is undertaken, and; potential for the grants to amplify existing ASM problems such as environmental degradation, HIV/AIDS if training in entrepreneurship, Safety, Health and Environment (SHE) and social responsibility is not properly undertaken. Similarly, ineffectiveness of the reforms may occur if harmonization of laws and clear definitions of roles and responsibilities are not achieved.

Inadequate capacity to manage procurement, financial management and disbursement and conducting monitoring and evaluation may also hamper progress and positive impacts of the project. Needs assessment for capacity building should be done in a holistic manner since this could lead to staff dissatisfaction if key areas of capacity building are not achieved. Good governance should be adhered to avoid hampering the effectiveness of the reforms

In preparing this report, extensive consultations were held with appropriate stakeholders at the national and local levels including government ministries/agencies, mining companies, other private sector actors, artisanal miners, NGO’s, people and communities in mining areas. These consultations were made through field visits conducted in selected sites of the country, where SMMRP is expected to cover. Review of existing information and data on SMMRP project components and other previous studies were also conducted. Although the SMMRP is expected to bring improvements to the mineral sector, the following risks were identified:

·  Inadequate stakeholder consultation could affect stakeholder participation and effectiveness of the projected outcomes. This risk in particular concerns such activities as financial assistance, extension service, programs for industrial minerals, legal and fiscal reforms and promotion and communication. In other cases such as the airborne geophysical survey, public consultation and awareness could determine the progress of the proposed activities;

·  Poor selection criteria for small grants program, site selection for demonstration centres and selection of ASM for training of trainers under the project could create unfair competition and affect projected outcomes;

·  Inadequate training of entrepreneurs and government officials, particularly with respect to transportable demonstration units (TDUs), operation of demonstration centres, and use of financial assistance could amplify existing health and safety risks in ASM and also contribute to environmental degradation. Furthermore, inadequate training and monitoring could degrade SMMRP effectiveness;

These risks will be managed through implementation of this ESMF and engagement of regulatory framework and stakeholders outlined below:

·  Environment Regulatory Arrangements. All mining activities are subject to the Environmental Management Act 2004 and associated regulations. The National Environmental Management Council (NEMC) has primary responsibility of enforcing environmental legislation, including Environmental Management Plans for mining projects. All large mining projects in Tanzania are also subject to the Mining Act of 1998 and its regulations. The Mining Act has specific Sectoral Environmental requirements for holders of Mineral Rights;

·  Environmental Audits and Inspections. The Environmental Impact Assessment and Audit Regulations, 2005 (Part X) directs that Environmental Audits be conducted by a qualified and authorized environmental auditor or environmental inspector who shall be an expert or a firm of experts registered in accordance with the Environmental (Registration of Environmental Experts) Regulations, 2005. Furthermore the Mining (Environmental Management and Protection) Regulations, 1999, Section 19, calls for the appointment of an independent third party or consultant acceptable to the licensing authority;

·  Environmental Impact Statements. Detailed environmental impact statements, prepared to high standards, are required for all of the large-scale mining projects in Tanzania and are a prerequisite for obtaining mining licenses from MEM. Information disclosure and consultations with affected communities and landowners take place as part of the authorization process. The mining projects are typically operated by international mining companies that come under public scrutiny, in both their home country and in the countries where their operations are located, to comply with good international practice and face regulatory penalties and reputational risk if they fail abide by the rules;

·  Social Safeguards. There is no single piece of legislation that governs resettlement in Tanzania. However a number of sections of legislation are applicable to any resettlement process. As such World Bank guidelines will become applicable in case safeguard issues are triggered during project implementation. Other relevant legislations that will be considered include the Mining Act of 1998; Land Act of 1999 (Cap 113); Village Land Act of 1999; Land Acquisition Act of 1967; Land Disputes Courts Act, (Cap 216); Grave (Removal) Act of 1969; Environmental Management Act of 2004; Antiquities Act of 1964 (amended 1979); Land (Compensation Claims) Regulation 2001; and the Forest Act of 2002;

·  Key Players. The Ministry of Energy and Minerals (MEM) will take the leading role as the principal implementing Agency to oversee the implementation of the SMMRP. The MEM also oversees the implementation of the Mining Policy; Enforcement of laws and regulations for mining and protection of the environment; Environmental monitoring and auditing of the various SMMRP project activities; Mining projects EIS & EMP approvals (through a Multi-Sectoral committee); and Mining conflict resolutions;

Vice President’s Office (Division of Environment) is responsible for approvals of SESA and EIA certificates; formulation and articulation of policy guidelines necessary for promotion & protection of the environment; and issue general guidelines to sector Ministries & coordinates all agencies public/private institutions related to environmental management;

Holders of mining Licenses (SSM/LSM) are responsible for conducting Environmental and Social Assessment, resettlement of project affected people, Implementation of the Environmental and Social Management Plan and Project Monitoring, internal and external environmental auditing and reporting;

District, Ward and Village Environmental Committees have the role of Coordinating and advising on environmental policies and implementation obstacles, Promoting environmental awareness, Information generation, assembly and dissemination from any person, Initiate inquiries and investigation on any environmental disputes or violation of the Act, Resolve conflicts among individual persons, companies, agencies, NGOs, Government Departments, Inspect any source of pollution in the area, and Initiate proceedings of civil nature against any person, company, and agency for failing or refusing action under the Act;

·  Risk Mitigation. The Government has requested the support of the International Development Association and the World Bank to improve its ability to minimize and mitigate potentially adverse impacts of mining through (a) improved environmental and social legal and regulatory framework for mining; and (b) improved enforcement capacity of the relevant authorities involved in the sector. The support will include assistance in the preparation of regulatory frameworks, a Strategic Environmental and Social Assessment, Poverty and Social Impact Assessment, improved guidelines and procedures on consultations and training, and procedures to mitigate impacts in artisanal and small scale mining (ASM);

·  Policy and Regulatory Frameworks. The project will support the review of several policies aimed at improving the environment and social outcomes, including the Mineral Policy. Relevant regulations and guidelines for implementation will also be prepared;

·  Strategic Environmental and Social Assessment The project will support a Strategic Environmental and Social Assessment (SESA) of the mining sector in order to identify policy and regulatory gaps which may need to be addressed by the Government. The SESA will examine if policy and regulatory gaps exist and if there is adequate compliance monitoring, and whether additional resources and standardized procedures are needed to mitigate the identified risks. Based on this analysis, the SESA will identify: (i) institutional strengthening actions to deal with environmental and social impacts associated with the growth and development of the mining sector (including artisanal and small scale mining); (ii) measures to overcome the policy, institutional and budgetary constraints that result in limited enforcement and implementation capacity; (iii) ways to improve an already strong and comprehensive public participation process of land owners in the negotiation and review of mining project Memoranda of Association;.

·  Engagement with Civil Society, Communities and key stakeholders. Consultations were held with relevant, mining companies, Regional Miners Associations, ZMO’s and RMO’s, District Executive Directors and village governments. These consultations were made through field visits conducted in selected sites, where SMMRP covers. Table 1.1 below provides a list of stakeholders interviewed during the scoping study period.

Table 1.1: Stakeholders interviewed for SMMRP Project

GOVERNMENT / LOCAL GOVERNMENTS / INSTITUTIONS / LARGE SCALE MINES / VILLAGE COUNCILS / SMALL SCALE MINES
RMO – Geita / Geita DED / STAMICO / Geita Gold Mine (gold) / Lwamgasa – Geita District / Kadeo – Lwamgasa (gold)
ZMO – Singida / Singida DED / NEMC / TanzaniteOne Mine (gemstones) / Nyarugusu – Geita District / MWAREMA – Nyarugusu
ZMO – Arusha / Babati DED / Sambaru – Singida Rural District / SIREMA – Sambaru
RMO – Songea / Mbinga DED / Amani Makoro – Mbinga District / RUVUREMA – Ruvuma
RMO – Chunya / Chunya DED / Matundasi – Chunya District / Itumbi mine - Chunya (gold)
VPO-DOE / Kisarawe DED / Rahim Massawe – Mirerani (gemstones)
Arusha Gemstone Centre / Pugu Kaolin Mines – Kisarawe (industrial mineral)
MEM- HQ (SMMRP Office) / Richard Mutatina – Kisarawe (industrial minerals)

The ESMF was initially disclosed during a project briefing involving all relevant stakeholders of the project on 3rd April 2009 at the International Conference Centre, PPF tower, Dar es Salaam, Tanzania pursuant to WB operational Policy 4.01. The Executive Summary of this document was translated into Swahili language and disclosed to stakeholders and to local media during the briefing. The Consultants explained the scope of the SMMRP project activities and how key stakeholders will be involved. Stakeholders were given time to comment on the ESMF presentation, and the following key issues arose from the dialogue:

·  A clear distinction between the coordinators of SMMRP (in this case MEM) and the implementers (stakeholders) should be well defined

·  Training should be given priority to ASM in order to reduce the identified risks related to assistance programs for ASM. Vocational Education and Training Authority (VETA) and South and the Eastern Africa Mineral Centre (SEAMIC) offered a hand in training the ASM during SMMRP implementation.

·  The National Environment Management Council (NEMC) and other stakeholders should be given greater roles in the implementation of SMMRP. More stakeholders need to be included in the consultation processes such as the Steering Committee and the Project Technical Committee