CAR: PRC: Municipal Water Distribution Infrastructure
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Environmental and Social Safeguards Compliance Audit February 2012 PRC: Municipal Water Distribution Infrastructure Development Project ChongQing City YongChuan District QiaoLi Water Affairs Co., Limited Prepared by China Water Affairs Group Limited for the Asian Development Bank (ADB) This report has been submitted to ADB by China Water Affairs Group Limited and is made publicly available in accordance with ADB’s public communications policy (2005). It does not necessarily reflect the views of ADB. ChongQing City YongChuan District QiaoLi Water Affairs Co. Limited February 2012 Environmental and Social Safeguards Compliance Audit (and Corrective Action Plan) China Water Affairs Group Limited ESMS AUDIT REPORT Document Number: ESMS/QIAOLIWA/BP-AP/V1.0/20022012 Topic: Environmental and Social Safeguards Compliance Audit (And Corrective Action Plan) Written and Prepared by ESMS Supervisor: Wen, Wei Verified and Approved by ESMS Manager: Li, Xing Ping Approved by Executive General Manager: Liu, Yong ESMS Committee Representative: Chan, Jacky Contact Persons: Li, Xing Ping (ESMS Manager/ Deputy General Manager) Email: [email protected] Fax: +86 0755 33362493 (Office) Telephone: +86 0755 33360255 (Office) ii ABBREVIATIONS ADB – Asian Development Bank AP – Affected peoples by the Project CAP – Corrective Action Plan CWA – China Water Affairs Group Limited DRC – Development and Reform Commission (Government Authority) EIA – Environmental Impact Assessment EPB – Environment Protection Bureau (Government Authority) IPS – Intermediate Pressure Station IR – Involuntary Resettlement LA – Land Acquisition LAA – Land Acquisition Agreement LRB – Land Resource Bureau (Government Authority) PRC – People’s Republic of China RMB – The lawful currency of the PRC RWEP – raw water extraction point SPS – ADB’s Safeguards Policy Statement (2009) SR – ADB’s Safeguard Requirements (ADB SPS 2009) WP – water plant WRB – Water Resource Bureau (Government Authority) iii CONTENTS I. INTRODUCTION ....................................................................................................... 1 A. Project Overviews ................................................................................................ 1 B. Objectives of the Report ....................................................................................... 2 C. Methodology ........................................................................................................ 3 II. AUDIT FINDINGS .................................................................................................... 3 A. Past and Present Related Safeguards Issues ......................................................... 3 i. Environment.................................................................................................. 3 ii. Land Acquisition and Involuntary Resettlement ......................................... 6 iii. The Indigenous Peoples ............................................................................ 10 B. Other Social Matters........................................................................................... 10 i. Sustainable Development ........................................................................... 10 ii. Gender and Employment ............................................................................ 11 iii. Labor and Community Health and Safety ................................................ 12 III. CONCLUSION AND RECOMMENDATIONS .................................................... 13 A. Conclusion ......................................................................................................... 13 B. Recommendations and Corrective Action Plan .................................................. 14 IV. ANNEX AND TRANSLATIONS Annex 1 - Government Municipal Approval Annex 2 - Project Site (No.3 Water Plant) Surrounding Annex 3 - Entrustment L.A. Agreement Annex 4 - Entrustment Land Reclamation Agreement Annex 5 - Public Housing for L.A. Resettlement Annex 6 - Certified Letter Annex 7 - Testing Result of Related Raw Water Source iv I. INTRODUCTION A. Project Overviews i. ChongQing City YongChuan District QiaoLi Water Affairs Co. Limited (hereinafter referred to as “Project Company”), a subsidiary China Water Affairs Group Ltd. (“CWA”), was acquired in 2007. The proposed Project, located in YongChuan District of ChongQing Municipality (Figure 1&2), is controlled by the CWA as CWA owns 100% shares of the Project Company. Figure 1 – Chongqing Municipality (highlighted part) on the Map of China Figure 2 - Project Location (YongChuan District of ChongQing Municipality) - 1 - ii. Background and New Project Necessity: The YongChuan District, located in the west of Municipality ChongQing, has an urban population over 360,000 and covers urban land area approximate 35.3km2. (a) There are two (2) water plants in urban area of YongChuan District, contributing total 85,000 m3/day distributing capacity – 55,000 m3/day from the No.1 WP (also named QiaoLi WP) and 30,000 m3/day from No.2 WP (also referred to as SunJiaKou WP). Both Water Plants extract raw water from GuanMenShan Reservoir 1, which is located approximate 30km southwest of No. 1 WP (see locations on Figure 2). According to the “Environment Quality Bulletin”, a research conducted by government environmental authority, it indicates that the water quality of GuanMenShan Reservoir fulfills the national requirement, and classified as Grade III surface water. (Annex 7) (b) According to “YongChuan District General Planning for2004-2020”2, it predicted that water demands in YongChuan urban area would reach 129,200m3/day by 2015 and surpass 198,500m3/day by 2020. (c) Issues associated with insufficient water supplying and under developed water distribution network have severely hindered the process of urbanization, especially after the State Council of PRC upgraded former YongChuan city to be one of the districts of the southwestern megacity ChongQing in 2006. (d) Moreover, the newly established urban center of YongChuan is located far east from the existing water plants, causing inadequate water pressure in distribution system, considered an obstacle for the developing local economy. iii. To Overcome the Issues: To overcome the issues presented above, the Project Company had negotiated with the District People’s Government of YongChuan, and formed an Investment Agreement. Pursuant to this Agreement, the No.3 Water Plant (hereinafter referred to as”No.3 WP”), building with an overall distribution capacity of 200,000m3/day, will be proceeded in two phases that each phase consists of 100,000m3/day facility construction. In 2010, ChongQing Municipal DRC officially approved the Phase I construction of No.3 WP (Annex 1). iii. Project Break down: (a) Major Infrastructure: Purification Facility (10m3/day) including flocculation and backwashing sedimentation tanks; backwashing and distribution pump houses; chlorine processing, chemical dosing processing, sludge treatment processing and chlorine dioxide disinfection processing compartment. 2 (b) Auxiliary Facility: 320m equipment maintenance warehouse. 2 (c) Utility Facility: 438m electrical room. (d) Environmental Protection: Industrial/ domestic wastewater treatment system; 1 GuanMenShan Reservoir – a major reservoir that serves YongChuan Area, established in 1982, with 6,400,000m3 normal capacity and 20km2 rain catchment area. 2 “YongChuan District General Planning for 2004-2020” – a research conducted by University of Chongqing, Urban Planning Design and Research Institute, in October 2006. - 2 - chlorine absorbing system; sludge treatment and temporary storage compartment. (e) Office Facility: Office buildings in WP site and monitoring cameras at RWEPs. (f) Storage Rooms: Storage for chemicals and chlorine products. iv. Project Accomplishment and ADB Loan involvement: (a) Phase I began constructing at June 2010, until September 2011, 60% of the project has been accomplished. (b) The Project Company decided to utilize the ADB facility, accounted for 68.5% of the total investment, settling the outstanding payables of the Project. B. Objectives of the Report: This Compliance Audit Report is being prepared to comply with the 2009 ADB’s SPS, including Safeguards Requirement and aims to identify past and present concerns from the production and business activities of Project Company that related to impacts on environment, involuntary resettlement (physical or economic displacement) and ethnic/ indigenous people, determines whether actions were in accordance with ADB’s SR1, SR2, SR3 principals, requirements and prepare a Corrective Action Plan (“CAP”) containing necessary remedial actions, approximate budget and time frame for resolution of any noncompliance. C. Methodology Four (4) experts from the ESMS committee from the Shenzhen China head-office of CWA have been sent to cooperate along with colleagues in local Project Company and conducted a series of investigation and verification, specific methodologies including: i. Review of documents which shall all conform to “the PRC of the Environment Protection Laws” and other relevant documents: (a) “Feasibility Study for ChongQing YongChuan No.3 Water Plant” prepared by the Municipal Engineering Southwest Design Institute in March 2009; (b) “Environmental Impact Assessment for ChongQing YongChuan No.3 Water Plant Phase One Construction” prepared by ChongQing Environment Protection Engineering Design Institute in November 2010; (c) “Approval of Feasibility Study for ChongQing YongChuan No.3 Water Plant (Phase