Environmental and Social Monitoring Report

Project Number: 53115-001 13 March 2020

REG: Asia-Pacific Remote Broadband Internet Satellite Project

Prepared by Kacific and Ere-S Pte Ltd, Singapore for the Asian Development Bank.

The environmental and social monitoring report is a document of the borrower. The views expressed herein do not necessarily represent those of ADB’s Board of Directors, Management, or staff, and may be preliminary in nature. Your attention is directed to the “Terms of Use” section of this website.

In preparing any country program or strategy, financing any project, or by making any designation of or reference to a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

ENVIRONMENTAL AND SOCIAL MONITORING REPORT

13 March 2020

Reporting Period: 30 Nov to 31 Dec 2019

KACIFIC - KA BAND SATELLITE GATEWAY EARTH STATIONS AUSTRALIA, AND THE PHILIPPINES

Prepared by: Guillaume de Saint-Bon, General manager Operations (Kacific, Singapore); Jean-Pierre Dalla Palma, consultant (Ere-S Pte Ltd, Singapore)

For: Asian Development Bank Guarantco

Contents A PURPOSE OF THE MONITORING REPORT ...... 3 B BACKGROUND OF THE PROJECT...... 3 1. Project Components ...... 4 PHILIPPINES: SUBIC SITE ...... 5 PHILIPPINES: CLARK SITE ...... 7 INDONESIA: SURABAYA SITE ...... 8 INDONESIA: PASURUAN SITE ...... 10 AUSTRALIA: BROKEN HILL SITE ...... 11 2. Project Components Status ...... 12 C INITIAL CORRECTIVE ACTION PLAN STATUS ...... 13 D ENVIRONMENTAL AND SOCIAL MANAGEMENT ...... 16 E ENVIRONMENTAL AND SOCIAL PERFORMANCE ...... 18 PHILIPPINES: SUBIC SITE ...... 20 PHILIPPINES: CLARK SITE ...... 22 INDONESIA: SURABAYA SITE ...... 24 INDONESIA: PASURUAN SITE ...... 27 AUSTRALIA: BROKEN HILL SITE ...... 30 F SOCIAL PROTECTION REQUIREMENTS ...... 33 G GRIEVANCE MECHANISM ...... 34

Abbreviations

ADB - Asian Development Bank EHS - Environmental, Health and Safety EIA - Environmental Impact Assessment ES - Environmental and Social ESG - Environmental, Social and Governance ESMS - Environmental and Social Management System ESMP - Environmental and Social Management Plan IEE - Initial Environmental Examination OHS - Occupational Health and Safety SPS - (ADB) Safeguards Policy Statement

Kacific – Environment and Social Monitoring Report – February 2020 2 A PURPOSE OF THE MONITORING REPORT

1. This environmental and social monitoring report presents the project’s environmental and social performance in compliance with the requirements of ADB’s Safeguards Policy Statement 2009 (ADB SPS), applicable laws and regulations of the countries (i.e. Philippines, Indonesia, Australia) where components of the Project are located or associated and applicable good international industry practices. The project is categorized as “B” for environment, “C” for involuntary resettlement (IR) and “C” for Indigenous Peoples based on ADB SPS. This report describes and assesses the implementation of the environmental and social management plan (ESMP) prepared for this project during its construction and operation.

2. This report includes the background information of the project and the status of implementation from 30 Nov to 31 Dec 2019. It also includes information on activities related to information disclosure, grievance redress and capacity building.

B BACKGROUND OF THE PROJECT

3. The proposed loan was used to support the construction, launch, and operation of a shared, geostationary earth orbit (GEO), high-throughput satellite (HTS) (Kacific-1), featuring Ka-band technology, which will be dedicated to low cost, high-speed, easily accessible broadband internet in Asia and the Pacific. The project will provide wide access to broadband internet connections in remote areas, where no or very limited internet coverage is currently available. The project will benefit the population in remote areas of Asia and the Pacific by increasing the availability and quality of broadband internet service, which will lead to greater sustainable socioeconomic growth and poverty reduction.

Figure 1. Kacific portion of the satellite’s payload

Kacific – Environment and Social Monitoring Report – February 2020 3 1. Project Components

Satellite 4. The satellite-related activities are managed by Boeing, SpaceX and JSAT. Although the facilities of these three key partners are essential to the operations of the Project, they are not exclusively dependent on the Project and are not under the control or influence of Kacific and ADB. Hence, these facilities do not fall within the definition of associated facilities under ADB SPS. A brief description of the profile and role of the three partners is provided below:

• Boeing Satellite Systems International, Inc. (“Boeing”) was commissioned in early 2017 to manufacture the satellite that is used for the Project. The environmental and social management approach of Boeing can be found on the group’s website. • Space Exploration Technologies Corporation (“SpaceX”) provided launch services for the satellite. The launch of the satellite took place in the United States at Cape Canaveral. The impacts related to satellite launching were assessed based on desk-top review and identified the potential impacts on wastes, air and GHG emissions, and health and safety concern. SpaceX launching facility is located in Cape Canaveral, Florida, and follows a Range Safety Program which ensures that hazards and risks associated with range operations from launches are controlled and mitigated. It is also bound to comply with National legislative requirements, including the National Environmental Policy Act (NEPA). Whilst the probability of launch failure is unknown, extensive discussion on potential scenarios during launch failure, and impacts to natural environment, and the community have been undertaken by relevant federal agencies. The environmental assessment for SpaceX Launch License is posted in the Federal Aviation Authority website. • Sky Perfect JSAT Corporation (“JSAT”), a leading Japanese satellite operator, is responsible for managing the JCSAT-18 satellite in terms of tracking, telemetry services and control (TT&C), command, monitoring and other related services through its existing JSAT control centre in Yokohama, Japan. It is also responsible for the operations, maintenance and management of the satellite under an operations, management and maintenance (O&MM) agreement. The environmental and social management approach of JSAT can be found on the company’s website.

Teleports

5. The Project consists of five teleport locations in Philippines, Indonesia and Australia. From an environmental and social perspective, the teleports are the main component of the Project, as they require installation work for new antennae and ongoing operation and maintenance over their lifespan. The Australian teleport site hosts one gateway site whilst the Indonesian and Philippines teleports are operating two gateway sites each. For the Indonesia and Philippines, one gateway (Subic) represents the primary site and the second gateway (Clark) is defined as a diversity site. This is required to provide high uplink availability to the system.

6. The installation of Kacific equipment was done within footprints of existing teleport farms to enable the use of the existing installed infrastructure and services that the antennae require. The only exception is the Pasuruan site in Indonesia, where the entire structure had to be built in an isolated green field.

Kacific – Environment and Social Monitoring Report – February 2020 4 7. The installation work was undertaken by third party vendors, namely Kratos Communications Limited ("Kratos") and Newtec Cy N.V. ("Newtec"), within the following scope of work:

• Kratos has been appointed on a turnkey basis to install the 9m antennae required at each location (including civil works to install a concrete slab of approximately 7m length x7m width x 0.8m depth).

• Newtec was responsible for the installation and testing of the electronic equipment to support the linkage with the satellite.

PHILIPPINES: SUBIC SITE

8. The site is an existing teleport farm that was established around 20 years ago and was formerly part of the US Navy Subic Bay facility as part of a larger ammunition storage facility. The address is: BBS (Broadband Broadcasting Services) Subic, Group V Naval Magazines, Morong, Bataan, the Philippines. The site is leased from Subic Bay Municipal Authority and reportedly has an area of 7,864 square metres.

Figure 2. Arial view of Subic site

9. The site has been operation for around 20 years and is now operated by ABS, a global satellite operator and services provider. The site provides tracking, telemetry, control services, satellite operations, customer technical assistance, and managed services to a variety of providers. ABS equipment and infrastructure includes the following elements:

• One main two-storey office building that houses offices, operational areas and ancillaries, e.g. Uninterruptable Power Supply units • Open area with antennae installed consisting of over 17 large antennae (with a diameter of over 4.5m) and around 45 smaller antennae (with a diameter of under 4.5m)

Kacific – Environment and Social Monitoring Report – February 2020 5 • Former ammunition bunkers and shipping containers for dry equipment storage. • One 20,000-litre underground storage tank (UST) of unknown construction; and one 3,000-litre steel above ground day tank (bunded) • Generator room installed with two back-up generators (rated at 400kW and 1 ,400KW) • Ancillary areas for storage of wastes and equipment • Housing (separated for male and female staff) • External access roads and parking laid to asphalt • A fire alarm system that incorporates 67 smoke alarms, 18 heat detectors, eight fire alarm bells and eight manual alarm points, including fire extinguishers installed around the facility • Guardhouse at the road access point. The site can only be accessed by one main entrance that is security controlled and security is available on-site 24 hours a day

10. Most of ABS personnel works on a three-shift pattern (of eight hours each) and administration and logistics on a one shift pattern (08:00 to 1700hrs). There are around 85 employed at the site (around 70% are locally employed). Cleaning/housekeeping is outsourced to a third-party contractor.

11. The environmental and social aspects related to the ABS equipment, activities and workforce are managed by ABS. Kacific is only responsible for the environmental and social management approach and impacts related to the construction and operations of its own single teleport.

Figure 3. Kacific teleport at Subic site (at the beginning of the construction phase)

12. The site is located in a relatively rural area within the Bataan Natural Park and Subic Bay Forest Reserve which covers an area of 48,103 hectares and includes areas of the Subic Bay Freeport Zone. The lowlands around Subic Bay are now predominantly agricultural land and human settlements. Old growth forest is mainly confined to the steep slopes and gullies at higher altitudes located further east and south east of the site. On the basis of this, whilst the site is located in a designated area, given the nature and extent of the Project's construction and operational phases, the direct impacts on biodiversity at the site are not considered to be significant.

Kacific – Environment and Social Monitoring Report – February 2020 6 13. The installation of the antennae (and associated equipment) was done within the existing footprint of the established site and forms a minimal addition in terms of space required in the existing teleport farm. It is also located around 80m from a public road that is well used. No cutting or trimming of trees of the adjacent forest was required for the Project.

14. The main road heading southwards from Subic Bay is located around 150m east of the site and the main off-site impact associated with the site is essentially traffic related, with personnel going to and from the location, and for the Project transport of goods and materials. The public road to access the site is well- sized for the type of transport required with the site operations and the construction of Kacific teleport.

15. There are other business ventures within a 2km radius of the site and the nearest group of dwellings is located around 2km south of the site. Given the nature and location of the site, consultation and participation with external stakeholders has been voluntary limited to the local authorities.

16. Based on our initial audit, nothing came to our attention that causes us to believe that the local employment practices by ABS and our contractors represent any risk related to child labour, forced labour and other unfair or discriminative labour practices. In addition, no impact on physical cultural resources or previous issues of involuntary resettlement were identified.

PHILIPPINES: CLARK SITE

17. The Clark site is located around 4km west of the Clarke International Airport in an area of mixed land uses with commercial and residential in the vicinity. To the north is a fuel product terminal operated by Philippine Coastal Storage & Pipeline Corporation (PCSPC) that is connected to another terminal at Subic Bay by an underground pipeline. Site is accessed to the south where there are nearby residences.

Figure 4. Arial view of Clark site

18. Construction machinery and equipment were brought from the Northern and larger and isolated road.

Kacific – Environment and Social Monitoring Report – February 2020 7

19. As for the Subic site, the direct impacts on biodiversity at the site are not considered to be significant during the construction and operation phases. While there is a limited number of residential properties within 50m of site boundary, previous discussion with nearby residences did not indicated issues with the site and consultation and participation with other external stakeholders has been voluntary limited to the local authorities.

INDONESIA: SURABAYA SITE

The site is located at Jalan Raya Kali Rungkut No. 15A, Kali Rungkut, Kec. Rungkut, Kota Surabaya, Jawa Timur 60293, Indonesia. It is an existing communications hub that was established around 10 years ago. The site is located within a highly urbanised area and is not located within any areas of specific biodiversity interest. There are other business ventures and industrial units within a 2km radius of the site and shops with associated dwellings opposite the site.

20. The site and buildings are owned by PT XL with a total land area of 9,000 m2 and gross floor area of 8,000 m2, which are also leased to several other tenants. The site area includes:

• One main five storey building that houses offices, operational areas and ancillaries, e.g. Uninterruptable Power Supply (UPS) units and FM200 (a fire extinguishing gas) storage rooms • Two above-ground diesel storage tanks each with a capacity of 20,000 litre • Generator room installed with four back-up generators (each rated at rated at 1 ,005kW) and two above-ground day storage diesel tanks (each with a 5,000 litre capacity) • Ancillary areas for storage of wastes and equipment • A fire alarm system that incorporates smoke alarms, manual call points, a fire pump system with sprinklers in rooms containing electrical equipment and fire extinguishers installed around the facility. • External access roads and parking laid to asphalt • Guardhouse at the road access point. The site is accessed by one main entrance that is security controlled and security is available on-site 24 hours a day

21. Local personnel work on a three-shift pattern (of eight hours each) and administration and logistics on a one shift pattern (08:00 to 1700hrs). There are around 35 employed at the site (around 70% are locally employed). Cleaning/housekeeping is outsourced to a third-party contractor.

22. PT XL Axiata provides support and services for the installation and maintenance of Kacific main teleport on the site. The environmental and social aspects related to the PT XL Axiata equipment, activities and workforce are managed by PT XL Axiata. Kacific is only responsible for the environmental and social management approach and impacts related to the construction and operations of its own single teleport.

23. The teleport antennae were installed in an external area of the site, after removal of some simple metal structures used covered motorbike parking. The antennae were transported as a unit to be assembled to prevent over-sized loads being routed on roads through communities. The teleport construction work was done during the day and was not

Kacific – Environment and Social Monitoring Report – February 2020 8 expected to exceed the noise and emissions levels that are common in the area. Reportedly, the site has not received any complaints relating to noise or other aspects of the operations. Figure 5. Arial view of Surabaya site

24. The main off-site impact associated with the site is essentially traffic related with personnel going to and from the location, and for the Project transport of goods and materials. The public road to access the site is well- sized (albeit at times congested) for the type of transport required with the site operations and the construction of Kacific teleport.

25. For the installation of the teleport, there was substantial volumes of waste generated, mainly scrap metal from removal of the existing motorcycle parking, excavated soil, packaging and general waste. These were appropriately disposed of.

26. Given the nature and location of the site and the significantly low size and intensity of the construction work, consultation and participation with other external stakeholders has been voluntary limited to the local authorities.

27. Based on our initial audit, nothing came to our attention that causes us to believe that the local employment practices by PT XL Axiata and our contractors represent any risk related to child labour, forced labour and other unfair or discriminative labour practices. In addition, an Occupational, Health and Safety Management System (OHS MS) has been developed for the whole site by PT XL Axiata. No impact on physical cultural resources or previous issues of involuntary resettlement were identified.

Kacific – Environment and Social Monitoring Report – February 2020 9 INDONESIA: PASURUAN SITE

28. The site is located approximately 3.3km south east of the centre of Pasuruan and is part on a greenfield land acquired by Petro 1 off Jalan Hos Cokroaminoto. The teleport site has an area of approximately 1000 m2. The property is in an area of mixed land uses with mostly commercial buildings in the vicinity and only about six houses across an old rice field approximately 200 to 300m away. The site is immediately surrounded by other greenfield areas aside from the north west side of the site which has direct access to a well-used public road. The nearest housing is located around 50m to the south east of the site.

Figure 6. Arial view of Pasuruan site

29. The preparation of the teleport site required upfilling of the site, which was on low lying land, in order to prevent flooding and bring it up by an estimated 2 to 3 metres to the approximate level of the adjacent public road. Material for the upfill was taken from a well- established quarry operation approximately 13km to the south west Of the Site. This was followed by the installation of walling around the edge of the upfill area in preparation for Kratos to start their scope of works and install the teleport equipment.

30. As for the Surabaya site, the direct impacts on biodiversity at the site are not considered to be significant during the construction and operation phases. Given the nature and location of the site and previous discussion with nearby residences, which did not indicate any issues with Kacific site and activity, consultation and participation with other external stakeholders has been done through local authorities.

31. Based on our initial audit, nothing came to our attention that causes us to believe that the local employment practices by Petro 1 and our contractors represent any risk related to child labour, and other unfair or discriminative labour practices. In addition, no impact on physical cultural resources or previous issues of involuntary resettlement were identified. Local authorities inspected the site regularly during the construction and reported no issues related to the activity of Petro1 and contractors working on the site, or to impacts on the local community.

Kacific – Environment and Social Monitoring Report – February 2020 10 AUSTRALIA: BROKEN HILL SITE

32. The Australia teleport was built at an existing teleport farm located in an industrial park area of New South Wales at 34-36 Pinnacles Place, Broken Hill, NSW 2880, Australia. The site was originally constructed in 2003 by (a major Australian telecommunications company) and was acquired by IPStar at some point between 2004 and 2006. The site is located within a commercial area, with other business ventures within a 2 km radius. The nearest part of Broken Hill is located around 1.3km to the north east. The site area is less than one hectare in size and includes:

• One main single-storey office building that houses the IT equipment room and network operating centre

• Open area with existing antennae, one back-up generator and external paved areas for access and parking

33. The site is accessed by one main entrance that is locked, and the site is surrounded by chain link fencing. The site is operational 24 hours a day and, besides the maintenance visits by Kacific’s personnel, it is unmanned.

34. The site is not located within any areas of specific biodiversity interest. The main off- site impact associated with the site is essentially traffic related, with personnel going to and from the location, and for the Project transport of goods and materials. The public road to access the site is well- sized (albeit at times congested) for the type of transport required with the site operations and the construction of Kacific teleport.

35. Based on our initial audit, nothing came to our attention that causes us to believe that the local employment practices by our contractors represent any risk related to health and safety and other unfair or discriminative labour practices, such as child labour, or forced labour. In addition, no impact on physical cultural (aboriginal) resources or previous issues of involuntary resettlement were identified.

Figure 7. Aerial view of Broken Hill site

Kacific – Environment and Social Monitoring Report – February 2020 11 2. Project Components Status

The following civil works and activities were conducted during the reporting period: Table 1: Project activities and status

Activities Status Remarks Prior and during reporting period SATELLITE Satellite production Construction start: Feb Social and environmental performance 2019 managed by Boeing. Boeing did not report Completion: 22 October 2019 any E&S issues occurring during the satellite production. Satellite launch Launch: 16 Dec 2019 Social and environmental performance managed by SpaceX. SpaceX did not report any E&S issues occurring prior and during the launch. Satellite management, 16 Dec 2019 onward Social and environmental performance monitoring and managed by JSAT. JSAT did not report maintenance any E&S issues occurring during the reporting period. TELEPORTS Installing teleport at Civil work and assembly No E&S issues identified prior and during Subic site (Philippines) start: Sept 2019 the reporting period. Completion: Nov 2019 See performance Table 3. Installing teleport at Civil work and assembly No E&S issues identified prior and during Clark site (Philippines) start: Nov 2019 the reporting period. Completion: est. Feb 2020 See performance Table 4. Installing teleport at Civil work and assembly No E&S issues identified prior and during Surabaya site start: Sept 2019 the reporting period. (Indonesia) Completion: Nov 2019 See performance Table 5. Installing teleport at Civil work and assembly No E&S issues identified prior and during Pasuruan site start: Aug 2019 the reporting period. (Indonesia) Completion: Dec 2019 See performance Table 6. Installing teleport at Civil work and assembly No E&S issues identified prior and during Broken Hill site start: Aug 2019 the reporting period. (Australia) Completion: Oct 2019 See performance Table 7. After reporting period SATELLITE Satellite management, Ongoing Social and environmental performance monitoring and managed by JSAT. No E&S issues is maintenance expected during the operation phase. TELEPORTS Operation of Broken Operations started in Hill site (Australia) Jan 2020 Operation of Subic site Operations started in (Philippines) Jan 2020 Kacific’s ESMP procedures related to Operation of Clark site Operations expected to operation will be applied. (Philippines) start in Feb 2020 No significant environmental and social Operation of Surabaya Operations started in impact is expected during operations. site (Indonesia) Jan 2020 Operation of Pasuruan Operations started in site (Indonesia) Jan 2020

Kacific – Environment and Social Monitoring Report – February 2020 12 C INITIAL CORRECTIVE ACTION PLAN STATUS

36. Below is the Project corrective action plan, based on the key findings from our Initial Environmental Examination (audit), and the current completion status of each action. Table 2: Initial Corrective Action Plan

Ref Corrective Action Deliverable Timeline Status of Completion Kacific headquarters

1 Develop a policy for Kacific’s approach to managing E&S aspects, this Policy Prior to construction Completed should be up to one page and signed by the CEO and set the overall intent commencing of the first Policy prepared in 2019. and tone on the management of E&S aspects. teleport Submitted on 10 Oct 2019. Accepted on 11 Oct 2019. 2 Develop a straightforward framework and process for the oversight and E&S Process Prior to construction Completed management of relevant E&S aspects of the Project, particularly in relation and commencing of the first Framework & process prepared in 2019. to the construction and operation of the teleports. This should include Framework teleport Submitted on 10 Oct 2019. Accepted on 11 Oct 2019. monitoring and reporting of E&S aspects of the Project (and support onward reporting to ADB). 3 For each teleport develop an Environmental & Social Management Plan ESMP for each ESMP per teleport prior Completed for the construction and operational phases. These should consider in a teleport site each phase ESMPs prepared in 2019, taking the required systematic manner the risks and impacts associated with each teleport and (construction and considerations into account. provide an interface with third parties who will provide services (and may operation) Submitted on 10 Oct 2019. Accepted on 11 Oct 2019. have existing management systems. This should also capture relevant labour & working conditions components. Subic Site 4 For the ESMP to be developed, ensure that there is consideration of As with ESMP As with ESMP Completed biodiversity (although based on the information available there are development development above. ESMPs prepared in 2019, taking the required unlikely to be significant impacts. This should consider noise, light, hours above. considerations into account. of work and ensuring no clearance of trees. Submitted on 10 Oct 2019. Accepted on 11 Oct 2019. 5 In relation to occupational health & safety there is a need to formalise H&S Prior to construction Completed management of this aspect to meet local requirements (and the Applicable Management commencing (for See attached “Kacific Response to Audit Results” Standards). This relevant for their own operations and for Kacific’s Project components relevant to Our partner ABS is ensuring operations of the teleport. i.e., contractors who will work at the site for the construction of the relevant the Project). They are compliant with H&S applicable standards. Project components and the maintenance of Kacific’s equipment on-site (it Our Deputy CTO has personally supervised the is understood that this will be provided by the teleport operator). construction the teleport, on the ground. Also, Kacific Regional Director has been there 3 times (20-21 Nov 19, 6-10 Jan 20, 22-31 Jan 20) and confirmed H&S standards are applied. Ref Corrective Action Deliverable Timeline Status of Completion Clark Site 6 For the ESMP to be developed, ensure that there is consideration of As with ESMP As with ESMP Completed community impacts (including traffic, access and noise). development development above. ESMPs prepared in 2019, taking the required above. considerations into account. Submitted on 10 Oct 2019. Accepted on 11 Oct 2019. Pasuruan Site 7 For the ESMP to be developed, ensure that there is consideration of As with ESMP As with ESMP Completed community impacts e.g. noise, working hours etc.) and a contractor and development development above. ESMPs prepared in 2019, taking the required subcontractor management mechanism are in place to ensure the relevant above. considerations into account. environmental and social requirements are followed and implemented by Submitted on 10 Oct 2019. Accepted on 11 Oct 2019. contractors and subcontractors (including labour and working conditions in contracts of workers). Surabaya Site 8 For the ESMP to be developed, ensure that demolition of the existing As with ESMP As with ESMP Completed structures at the site is included, if this is relevant for the timing of development development above. This was not applicable. implementation of the ESMP. above. The structure was a small awning for bikes demolished by our main contractor with no safety issues or environmental impact reported. Therefore, this issue has not been integrated in the ESMP. Recommendations – Subic Site 9 Consider, as a risk reduction measure, requesting the formal testing of Evidence of Timing for discussion Completed the UST at the Subic site. Ideally this unit is likely best replaced in due raising this with Issue was raised to the Subic site management and UST course with a new unit which maybe better placed above ground with the Subic site was inspected and found compliant by our local partner appropriate secondary containment. management ABS. ABS however plans to get the tank formally inspected in Q1 2020. 10 Consider the requesting of an asbestos survey and development of a Evidence of Timing for discussion Completed management register (should asbestos be identified). raising this with This was not applicable. the Subic site management Inspection was carried out by ABS, which confirms that there is no asbestos onsite.

Kacific – Environment and Social Monitoring Report – February 2020 14 Ref Corrective Action Deliverable Timeline Status of Completion Recommendation – Australian Site 11 In addition to the ESMP to be developed, relation to occupational health & H&S Timing for discussion Completed safety there is a need to formalise management of this aspect to meet Management See attached “Kacific Response to Audit Results” Australian requirements (and the Applicable Standards). This relevant for their own operations and for Kacific’s Project i.e., contractors who will work Our partner IPSTAR is ensuring operations of the at the site for the construction of the relevant Project components and the teleport. They are compliant with applicable standards. maintenance of Kacific’s equipment on-site (it is understood that this will be provided by the teleport operator). Our Deputy CTO has personally supervised the construction the teleport, on the ground.

Also, Kacific has recruited a permanent site manager in Jan 2020 to ensure safe operations and maintenance of the teleport. Recommendation – Surabaya Site 12 Consider, as a risk reduction measure, requesting the formal testing of Evidence of Timing for discussion Completed the above ground storage tanks and associated pipework. raising this with On 11 Oct 2019, Petro 1 produced recent reports on the Surabaya certifications and conditions of the 2 daily fuel tanks & 2 site storage fuel tanks and the pipes used for the generators management at XL/Axiata Data Center. All were inspected and approved on 29 Aug 2018. Mandatory regular test for each tank is every 3 years. 13 Follow-up with the site to ensure that fire-extinguishers are inspected on- Evidence of Timing for discussion Completed time. raising this with Compliance is monitored regularly by our visiting staff - the Surabaya Deputy HSD (5-9 Nov 19), Pre-Sale Engineer (14-21 Jan site 20) – and Regional Director. management Last inspection done on 19 Dec 2019. Certificate is below.

Kacific – Environment and Social Monitoring Report – February 2020 15 D ENVIRONMENTAL AND SOCIAL MANAGEMENT

Management of Environmental and Social Aspects

a. Status of corporate policy for management of E&S aspects

37. As recognised in Kacific’s Environmental and Social (ES) Policy, protecting the natural environment and the well-being of the people working with the Company or impacted by its activities is of paramount importance. Kacific is also committed to the highest standard of corporate governance when working with partners, governments and suppliers. Kacific also abides by the terms of its Employment and Inclusion Policy Statement and we have developed the following principles for integrating environmental, social and governance (ESG) priorities into our decision-making, management approach and operations:

• To consider ESG issues in its technology and infrastructure investments; • To support investors, governments and communities in achieving economic, environmental and social resilience; • To act ethically and responsibly in all business dealings by complying with the applicable laws of the countries in which Kacific operates; • To engage with all key stakeholders, including partners, suppliers, governments and non- profit organisations, to advance the adoption of ESG considerations and best practices through the Company’s supply and value chains. b. Status of framework and process for oversight and management of relevant E&S aspects

38. Since the start of the Project, Kacific has required that all its contractors, sub- contractors, suppliers and their sub-suppliers adhere to the requirements of its ES Policy. We have also developed a comprehensive Environmental and Social Management System (ESMS) to integrate environmental and social considerations into our decision-making processes, management approaches, operational activities and relationships with our business partners, suppliers and other stakeholders along the value chain.

39. The ESMS also ensures that Kacific’s business activities are compliant with regulations and environmental and social safeguards that prevail at each site of the Project. We have also created and internal manual to explains the purpose, policies and requirements of the ESMS to our management, personnel, and other parties involved in the Project. The manual also acts as a guiding tool for the implementation and maintenance of all relevant procedures and processes to ensure that environmental and social risks are effectively addressed.

40. Due to time constraint, the ESMS was developed during the construction phase of the first teleport in Broken Hill, Australia. However, initial due diligence or ES policy enforcement allowed us to ensure that best environmental and social practices, as well as compliance to local regulations we applied by our contractors for the construction of the five teleports. c. Status of E&S Management Plan that includes labor and working conditions components

41. Our ESMP includes OHS mitigation measures covering Kacific employees as well as all contractual workers and any personnel who work at Project sites or provide Project-related services, are maintained during the construction and operations phases. OHS mitigation measures implemented on-site for construction of the teleports are under the responsibility of the main contractors. Unless specified in the contractual agreement with the relevant contractor/supplier, operations related OHS measures, covering Kacific staff, contracted workers and visitors, are managed by Kacific.

42. During the construction phase, Kacific ensured that OHS measures were implemented by contractors for all activities under their control. These measures were adapted to the nature of each construction area and the activities of the workers and other personnel who may have been impacted by the construction work.

43. For the operational phase, Kacific ensures that all applicable safety measures are implemented on every Project site. These measures, which are maintained by Kacific’s appointed personnel, are the same as for the contractors but adapted to the operations of buildings, activities and equipment of the sites and abide by the relevant local regulations.

44. Specific actions taken during both phases of the Project include:

• Kacific partners involved in the construction of the teleports have been screened. Kratos and Newtec both comply with stringent US and European standards.

• Our Deputy CTO has been personally involved on site during the construction of the teleports, monitoring that standards are applied.

• Regional Directors have been recruited in Indonesia and the Philippines in October 2019.Their responsibilities include the monitoring of our teleport sites and the application of our standards. They have received a training on Safety.

• A Site Manager has been recruited in Broken Hill in January 2020, with the same mission as above. He has also received a training on Safety.

• The Regional Directors and Site Manager are also supported there by other visiting operational staffs such as the Head of Service delivery and the Pre-sales Engineer.

• An audit tool is being created in Q1 2020 for facilitating OHS controlling and reporting.

Kacific – Environment and Social Monitoring Report – February 2020 17 E ENVIRONMENTAL AND SOCIAL PERFORMANCE

45. The tables on next pages present the required environmental and social performance indicators for each of the Project’s five sites. Where relevant, information on implemented mitigation measures has been included in the performance tables.

46. Environmental figures are provided for the construction phase and the operations phase, and cover the following activities: • Construction: Civil work (ground preparation and antenna assembly) / Mechanical and electrical assembly / Technical configuration • Operations: Maintenance work and configurations work / Generators use (occasionally) / Traffic to and from the site by maintenance personnel.

During the construction phase, air particles and noise emissions were produced by the movement and use of heavy machinery, such as trucks, crane truck, excavator, concrete mixer and scissor lift, to carry and assembly the teleport parts. Emissions from the operations phase, on the other hand, are minimal as they essentially originate from infrequent use of acoustically sealed generators and movement of light maintenance vehicles.

47. Additional notes:

a) Performance data on air particles and noise emissions has been estimated based on measurements provided by Kacific’s contractors and available statistical factors for emissions from construction activities and equipment.

b) Our figures include traffic-related emissions produced by the vehicles driving through the communities and natural habitat that surround the teleport sites. Ground dust emissions from activities on site and from vehicle movement on unpaved are not included, as they are deemed to have negligible concentration of PM10 and PM2.5. SOx concentration in the fuel used (only source of SOx on site) is also deemed negligible.

c) The intensity of the civil and assembly work required during the construction phase of each teleport was relatively low, including weeks-long periods with no or little construction activity. For this reason, we only considered the number of days with machine activity to calculate the average emissions and to prevent the dilution of their concentration over the whole duration of the phase. Reported PM concentration figures (µg/m3) are based on expert judgment and statistical estimation.

d) Construction operations were conducted within normal working business hours from Monday to Friday, between 8am to 4pm (8 hours max a day). Personnel, contractors and subcontractors only worked during daylight hours, apart from two (2) evenings (for a maximum of 5 hours) when photogrammetry alignment of the dish reflectors, which is only possible in the dark, was required. During that operation, no heavy machinery was used and therefore no emissions or noise were produced.

e) Noise was maintained at design level for the equipment used: E.g.: Excavator to prepare the slab location (80 dbA at 15 meters – 2 days of work), crane (85 dbA at 15 meters – 2 days of work).

f) Only Clarke and Pasuruan sites are next to inhabited areas.

Kacific – Environment and Social Monitoring Report – February 2020 18 Table 2. Guidelines IFC/World Bank Group Host Country Regulations Guidelines Guidelines Subic and Clark Surabaya and Pasuruan Broken Hill Dust (TSP) PM10: Short term IFC/World Bank Group Where no specific exposure standard has been Avg period 1year: 20 µg/m3 230 µg/NCM per 24 hr Guidelines are used assigned and the substance is both of inherently low Avg period 1day: 50 µg/m3 Long term toxicity and free from toxic impurities, exposure to PM2.5: Averaging 90 µg/NCM dusts should be maintained below 10 mg/m3, Avg period 1year: 10 µg/m3 Per 1 year measured as inhalable dust (8-hour TWA – time Avg period 1day: 25 µg/m3 weighted average). Nitrogen 1-year averaging period: 375 µg/NCM IFC/World Bank Group Particles as PM 10: 50 µg/m³ averaged over a 24-hour Oxides 40 µg/m3 (guideline) ppm: 0.20 Guidelines are used period (NOx) 1-hour averaging period: Average time (mn): 30 Particles as PM 2.5: Advisory reporting standard: 25 200 µg/m3 (guideline) 260 µg/NCM µg/m³ over a 1-day period; 8 µg/m³ over a 1-year ppm: 0.14 period Avge time (mn): 60 0.12 ppm averaged over a 1-hour period 0.03 ppm averaged over a 1-year period Sulfur 10-minute averaging period: 470 µg/NCM IFC/World Bank Group Particles as PM 10: 50 µg/m³ averaged over a 24-hour Oxides 500 mg/m3 ppm: 0.18 Guidelines are used period (SOx) - 24-hour averaging period: Average time (mn): 30 Particles as PM 2.5: Advisory reporting standard: 25 * 125 µg/m3 (Interim target-1) 340 µg/NCM µg/m³ over a 1-day period; 8 µg/m³ over a 1-year * 50 µg/m3 (Interim target-2) ppm: 0.13 period * 20 µg/m3 (guideline) Avge time (mn): 60 0.20 ppm averaged over a 1-hour period * 500 µg/m3 (guideline) 0.08 ppm averaged over a 24-hour period 0.02 ppm averaged over a 1-year period Noise level Residential: IFC/World Bank Group IFC/World Bank Group IFC/World Bank Group Guidelines are used (dBA) Daytime = 55 dBA Guidelines are used Guidelines are used Night time = 45 dBA Industrial and commercial: Daytime = 70 dBA Night time = 70 dBA

PHILIPPINES: SUBIC SITE

Start of construction: Sept 2019 Completion: Nov 2019 Start of operations: Jan 2020

Operations phase falls out of this reporting period (30 Nov – 31 Dec 2019).

Table 3. Subic site performance

Performance Subic site A. Construction Phase B. Operations Phase (expected performance) Ambient Air Quality Dust (TSP) Total emissions from construction activities: Total emissions from maintenance activities(per year): PM10: 1.15 kg PM10: 0.02 kg PM2.5: 1.05 kg PM2.5: 0.02 kg Concentration for 1-year average period below 0.05 µg/m3 Estimated concentration: for both PM10 and PM2.5, while concentration for 24-hour PM10: negligible 3 average period estimated to be below 50 µg/m and 20 PM2.5: negligible µg/m3 respectively. Nitrogen Oxides (NOx) Total emissions from construction activities Total emissions from maintenance activities(per year): NOx: 33.02 kg NOx: 0.15 kg Concentration for 1-year average period below 1 µg/m3, Estimated concentration (average period 1 year): while concentration for 1-hour average period estimated to NOx: negligible be significantly below 200 µg/m3 around the site. Sulfur Oxides (SOx) SOx concentration in the fuel used is negligible. SOx concentration in the fuel used is negligible.

Kacific – Environment and Social Monitoring Report – February 2020 20 Performance Subic site A. Construction Phase B. Operations Phase (expected performance) Noise level (dbA) Estimates at 50 meters from teleport. Day time: Infrequent movements of maintenance vehicles at • Day time: Peak values at 70 dbA (around 2 days of normal traffic noise levels excavator work) and 75 dbA (around 2 days of crane Night time: No night activity work). Otherwise, infrequent movements of maintenance vehicles at normal traffic noise levels. Regular checks are made to ensure generator and other • Night time: No night activity machinery are acoustically sealed.

Noise at nearest dwelling (2 km) from teleport negligible due to distance and forest between the locations. Access roads: Only daytime and infrequent movement of Project’s vehicles at normal traffic noise levels. Noise was maintained at design level and vehicles and machinery remained turned on only when needed. No complaint relating to the antennae transportation on roads through adjacent communities was reported. Land clearance None. The teleport was created in a teleport farm. None. Spoil generation About 10m3 were excavated and spread evenly across the No spoil is expected to be generated. (from excavation) site. No amount was discarded. Solid waste About 6 m3 of carboard boxes No production of solid waste is expected during operations on About 6 m3 of wooden crates this site. The waste was collected by a local waste company and disposed. Hazardous waste No hazardous waste was created during construction. Small amounts of hazardous waste, such as used oil, fluorescent lamp, e-waste and used batteries, are expected to be produced during operations. The companies conducting the annual maintenance is responsible to ensure that the waste is disposed of or recycled by accredited waste collectors and in accordance with all local laws and regulations. Occupational health and No work-related injury or fatality reported for the personnel No work-related injury or fatality reported for the personnel of safety (accidents and injuries) of Kacific and our contractors. Kacific and our contractors (as of 25 Feb 2020).

Kacific – Environment and Social Monitoring Report – February 2020 21

PHILIPPINES: CLARK SITE Start of construction: Nov 2019 Completion (est.): Feb 2020 Start of operations: Feb 2020

Operations phase falls out of this reporting period (30 Nov – 31 Dec 2019).

Table 4. Clark site performance

Performance Clark site A. Construction Phase B. Operations Phase (expected performance) Ambient Air Quality Dust (TSP) Total emissions from construction activities: Total emissions from maintenance activities(per year): PM10: 1.17 kg PM10: 0.03 kg PM2.5: 1.07 kg PM2.5: 0.03 kg Concentration for 1-year average period below 0.05 Estimated concentration: 3 µg/m for both PM10 and PM2.5, while concentration for 24- PM10: negligible 3 hour average period estimated to be below 50 µg/m and PM2.5: negligible 20 µg/m3 respectively. Nitrogen Oxides (NOx) Total emissions from construction activities Total emissions from maintenance activities(per year): NOx: 33.64 kg NOx: 0.20 kg Concentration for 1-year average period below 1 µg/m3, Estimated concentration (average period 1 year): while concentration for 1-hour average period estimated to NOx: negligible be significantly below 200 µg/m3 around the site. Sulfur Oxides (SOx) SOx concentration in the fuel used is negligible. SOx concentration in the fuel used is negligible.

Kacific – Environment and Social Monitoring Report – February 2020 22 Performance Clark site A. Construction Phase B. Operations Phase (expected performance) Noise level (dbA) Estimates at nearest households (45 m) from teleport. Day time: Infrequent movements of maintenance vehicles at • Day time: Peak values at 71 dbA (around 2 days of normal traffic noise levels excavator work) and 76 dbA (around 2 days of crane Night time: No night activity work). Otherwise, infrequent movements of maintenance vehicles at normal traffic noise levels. Regular checks are made to ensure generator and other machinery • Night time: No night activity are acoustically sealed.

Access roads: Only daytime and infrequent movement of Project’s vehicles at normal traffic noise levels.

Noise was maintained at design level and vehicles and machinery remained turned on only when needed. No complaint relating to the antennae transportation on roads through adjacent communities and habitats was reported. Land clearance None. The teleport was created in a teleport farm. None. Spoil generation About 10m3 were excavated and spread evenly across the No spoil is expected to be generated. (from excavation) site. No amount was discarded. Solid waste About 6 m3 of carboard boxes No production of solid waste is expected during operations on this About 6 m3 of wooden crates site.

The waste was collected by a local waste company and disposed. Hazardous waste No hazardous waste was created during construction. Small amounts of hazardous waste, such as used oil, fluorescent lamp, e-waste and used batteries, are expected to be produced during operations. The companies conducting the annual maintenance is responsible to ensure that the waste is disposed of or recycled by accredited waste collectors and in accordance with all local laws and regulations. Occupational health and No work-related injury or fatality reported for the personnel No work-related injury or fatality reported for the personnel of safety (accidents and injuries) of Kacific and our contractors. Kacific and our contractors (as of 25 Feb 2020).

Kacific – Environment and Social Monitoring Report – February 2020 23 INDONESIA: SURABAYA SITE

Start of construction: Sep 2019 Completion: Nov 2019 Start of operations: Jan 2020

Construction and operations phases fall out of this reporting period (30 Nov – 31 Dec 2019).

Table 5. Surabaya site performance

Performance Surabaya site A. Construction Phase B. Operations Phase (expected performance) Ambient Air Quality Dust (TSP) Total emissions from construction activities: Total emissions from maintenance activities(per year): PM10: 1.17 kg PM10: <0.02 kg PM2.5: 1.07 kg PM2.5: <0.02 kg Concentration for 1-year average period below 0.05 Estimated concentration: 3 µg/m for both PM10 and PM2.5, while concentration for PM10: negligible 3 24-hour average period estimated to be below 50 µg/m PM2.5: negligible and 20 µg/m3 respectively. Nitrogen Oxides (NOx) Total emissions from construction activities Total emissions from maintenance activities(per year): NOx: 33.55 kg NOx: <0.2 kg Concentration for 1-year average period below 1 µg/m3, Estimated concentration (average period 1 year): while concentration for 1-hour average period estimated NOx: negligible to be significantly below 200 µg/m3 around the site. Sulfur Oxides (SOx) SOx concentration in the fuel used is negligible. SOx concentration in the fuel used is negligible.

Kacific – Environment and Social Monitoring Report – February 2020 24 Performance Surabaya site A. Construction Phase B. Operations Phase (expected performance) Noise level (dbA) Estimates at nearest households (140 m) from teleport. Day time: Infrequent movements of maintenance vehicles at • Day time: Peak values at 61 dbA (around 2 days of normal traffic noise levels excavator work) and 66 dbA (around 2 days of Night time: No night activity crane work). Otherwise, infrequent movements of maintenance vehicles at normal traffic noise levels. Regular checks are made to ensure generator and other • Night time: No night activity machinery are acoustically sealed.

Access roads: Only daytime and infrequent movement of Project’s vehicles at normal traffic noise levels.

Noise was maintained at design level and vehicles and machinery remained turned on only when needed. No complaint relating to the antennae transportation on roads through adjacent communities was reported. Land clearance None. The teleport was created in a teleport farm. None. Spoil generation About 10m3 were excavated and spread evenly across No spoil is expected to be generated. (from excavation) the site. No amount was discarded. Solid waste About 6 m3 of carboard boxes No production of solid waste is expected during operations on this About 6 m3 of wooden crates site.

The waste was collected by a local waste company and disposed. Hazardous waste No hazardous waste was created during construction. Small amounts of hazardous waste, such as used oil, fluorescent lamp, e-waste and used batteries, are expected to be produced during operations. The companies conducting the annual maintenance is responsible to ensure that the waste is disposed of or recycled by accredited waste collectors and in accordance with all local laws and regulations. Occupational health and No work-related injury or fatality reported for the No work-related injury or fatality reported for the personnel of safety (accidents and injuries) personnel of Kacific and our contractors. Kacific and our contractors (as of 25 Feb 2020).

Kacific – Environment and Social Monitoring Report – February 2020 25

Figure 8. Surabaya site prior teleport construction Figure 9. Safety preparation meeting

Kacific – Environment and Social Monitoring Report – February 2020 26 INDONESIA: PASURUAN SITE

Start of construction: Aug 2019 Completion: Dec 2019 Start of operations: Jan 2020

Operations phase falls out of this reporting period (30 Nov – 31 Dec 2019).

Table 6. Pasuruan site performance

Performance Pasuruan site A. Construction Phase B. Operations Phase (expected performance) Ambient Air Quality Dust (TSP) Total emissions from construction activities: Total emissions from maintenance activities(per year): PM10: 1.43 kg PM10: 0.03 kg PM2.5: 1.28 kg PM2.5: 0.03 kg 3 Concentration for 1-year average period below 0.05 µg/m for Estimated concentration: both PM10 and PM2.5, while concentration for 24-hour average PM10: negligible 3 3 period estimated to be below 50 µg/m and 20 µg/m PM2.5: negligible respectively. Nitrogen Oxides (NOx) Total emissions from construction activities Total emissions from maintenance activities(per year): NOx: 40.31 kg NOx: 0.15 kg Concentration for 1-year average period below 1 µg/m3, while Estimated concentration (average period 1 year): concentration for 1-hour average period estimated to be NOx: negligible significantly below 200 µg/m3 around the site. Sulfur Oxides (SOx) SOx concentration in the fuel used is negligible. SOx concentration in the fuel used is negligible.

Kacific – Environment and Social Monitoring Report – February 2020 27 Performance Pasuruan site A. Construction Phase B. Operations Phase (expected performance) Noise level (dbA) Estimates at nearest households (65 m) from teleport. Day time: Infrequent movements of maintenance Day time: Peak values at 67 dbA (around 2 days of vehicles at normal traffic noise levels excavator work) and 72 dbA (around 2 days of Night time: No night activity crane work). Otherwise, infrequent movements of maintenance vehicles at normal traffic noise Regular checks are made to ensure generator and other levels. machinery are acoustically sealed. Night time: No night activity

Access roads: Only daytime and infrequent movement of Project’s vehicles at normal traffic noise levels.

Noise was maintained at design level and vehicles and machinery remained turned on only when needed. Our Deputy CTO ensured onsite that the construction machinery was suitably muffled and that emitted noise levels were not excessive and in-line with similar machinery. Noise levels at nearby locations was almost unperceivable. Local communities were informed by Petro 1 of vehicular movements in advance to limit inconvenience. No complaint relating to the antennae transportation on roads through adjacent communities was reported. Land clearance Land clearance was not required at this site as no None. vegetation other than light grass was present. No trees were removed or trimmed. Spoil generation About 10m3 were excavated and spread evenly across the site. No spoil is expected to be generated. (from excavation) No amount was discarded. Solid waste About 6 m3 of carboard boxes No production of solid waste is expected during operations About 6 m3 of wooden crates on this site.

The waste was collected by a local waste company and disposed.

Kacific – Environment and Social Monitoring Report – February 2020 28 Performance Pasuruan site A. Construction Phase B. Operations Phase (expected performance) Hazardous waste No hazardous waste was created during construction. Small amounts of hazardous waste, such as used oil, fluorescent lamp, e-waste and used batteries, are expected to be produced during operations. The companies conducting the annual maintenance is responsible to ensure that the waste is disposed of or recycled by accredited waste collectors and in accordance with all local laws and regulations. Occupational health and No work-related injury or fatality reported for the personnel of No work-related injury or fatality reported for the personnel safety (accidents and injuries) Kacific and our contractors. of Kacific and our contractors (as of 25 Feb 2020).

Figure 10. Ground preparation with limited impact

Kacific – Environment and Social Monitoring Report – February 2020 29 AUSTRALIA: BROKEN HILL SITE

Start of construction: Aug 2019 Completion: Oct 2019 Start of operations: Jan 2020

Construction and operations phases fall out of this reporting period (30 Nov – 31 Dec 2019).

Table 7. Broken Hill site performance

Performance Broken Hill site A. Construction Phase B. Operations Phase (expected performance) Ambient Air Quality Dust (TSP) Total emissions from construction activities: Total emissions from maintenance activities(per year): PM10: 1.16 kg PM10: 0.02 kg PM2.5: 1.07 kg PM2.5: 0.02 kg Concentration for 1-year average period below 0.05 Estimated concentration: 3 µg/m for both PM10 and PM2.5, while concentration for PM10: negligible 24-hour average period estimated to be below 50 PM2.5: negligible µg/m3 and 20 µg/m3 respectively. Kratos used water dust suppression system when excavating (2 days of work – less than 8 hours a day). Minimum dust was created. Our Deputy CTO, present on the ground, ensured all personnel were wearing PPE, including masks (NSW regulations). Nitrogen Oxides (NOx) Total emissions from construction activities Total emissions from maintenance activities(per year): NOx: 33.45 kg NOx: 0.15 kg Concentration for 1-year average period below 1 Estimated concentration (average period 1 year): µg/m3, while concentration for 1-hour average period NOx: negligible estimated to be significantly below 200 µg/m3 around the site.

Kacific – Environment and Social Monitoring Report – February 2020 30 Performance Broken Hill site A. Construction Phase B. Operations Phase (expected performance) Sulfur Oxides (SOx) SOx concentration in the fuel used is negligible. SOx concentration in the fuel used is negligible. Noise level (dbA) Estimates at nearest households (50 m) from teleport. Day time: Infrequent movements of maintenance vehicles at Day time: Peak values at 70 dbA (around 2 days of normal traffic noise levels excavator work) and 75 dbA (around 2 Night time: No night activity days of crane work). Otherwise, infrequent movements of maintenance Regular checks are made to ensure generator and other machinery vehicles at normal traffic noise levels. are acoustically sealed. Night time: No night activity

Access roads: Only daytime and infrequent movement of Project’s vehicles at normal traffic noise levels. Noise was maintained at design level and vehicles and machinery remained turned on only when needed. No complaint relating to the antennae transportation on roads through adjacent communities was reported. Land clearance None. The teleport was created in a teleport farm. None. Spoil generation About 10m3 were excavated and spread evenly across No spoil is expected to be generated. (from excavation) the site. No amount was discarded. Solid waste About 6 m3 of carboard boxes No production of solid waste is expected during operations on this About 6 m3 of wooden crates site. The waste was collected by a local waste company and disposed (land fill and recycling). Hazardous waste No hazardous waste was created during construction. Small amounts of hazardous waste, such as used oil, fluorescent lamp, e-waste and used batteries, are expected to be produced during operations. The companies conducting the annual maintenance is responsible to ensure that the waste is disposed of or recycled by accredited waste collectors and in accordance with all local laws and regulations.

Kacific – Environment and Social Monitoring Report – February 2020 31 Performance Broken Hill site A. Construction Phase B. Operations Phase (expected performance) Occupational health and No work-related injury or fatality reported for the No work-related injury or fatality reported for the personnel of safety (accidents and injuries) personnel of Kacific and our contractors. Kacific and our contractors (as of 25 Feb 2020). However, 1 Kratos employee was sick at Broken Hill upon arrival due to jetlag and dehydration. He required medical attention at the local hospital for 2 hrs. He returned to work fit the next day.

Figure 11. Installation of the teleport at Broken Hill site Figure 12. Part of the fire safety system

Kacific – Environment and Social Monitoring Report – February 2020 32 F SOCIAL PROTECTION REQUIREMENTS

a. Does Kacific carry out its activities consistent with the intent of ensuring legally permissible equal opportunity, fair treatment and non-discrimination in relation to recruitment and hiring, compensation, working conditions and terms of employment for its workers (including prohibiting any form of discrimination against women during hiring and providing equal work for equal pay for men and women?

Answer: Yes.

b. Does Kacific not restrict its workers from developing a legally permissible means of expressing their grievances and protecting their rights regarding working conditions and terms of employment?

Answer: Yes

Provide summary of grievance/s received from employees/workers at the corporate level and measures/actions undertaken.

Answer: None

c. Please state that Kacific and service providers/contractors/subcontractors are compliant with applicable national labor laws and international core labor standards: (i) freedom of association and the effective recognition of the right to collective bargaining, (ii) elimination of all forms of forced or compulsory labor, (iii) effective abolition of child labor, and (iv) elimination of discrimination in respect of employment and occupation

Answer: Kacific and service providers/contractors/subcontractors are compliant with applicable national labor laws and international core labor standards: (i) freedom of association and the effective recognition of the right to collective bargaining, (ii) elimination of all forms of forced or compulsory labor, (iii) effective abolition of child labor, and (iv) elimination of discrimination in respect of employment and occupation.

Provide discussion on the mechanism to ensure/ monitor compliance.

Answer: All Kacific partners have been screened. Kratos and Newtec both comply with stringent US and European standards. Our local partners operating our teleports are also complying with local standards. Our newly recruited Regional Directors are in charge of controlling that it remains a such and an audit tool is to be created in Q1 2020 for facilitating their tasks and reporting.

d. If Kacific undertook any involuntary retrenchment during the reporting period, please provide process and documentation of consultation with employees, retrenchment data including a copy of the retrenchment plan.

Answer: None.

G GRIEVANCE MECHANISM

a. Establishment of Grievance Redress Mechanisms and description of organizational arrangements

48. Given the nature and location of the sites, limited grievance redress mechanism was adopted by Kacific. This includes an official contact number or email address made available (posted on a signboard) at the sites located near commercial and/or residential areas, i.e. the Clark teleport site in Philippines and the Pasuruan teleport site in Indonesia, to allow for complaints or grievance reports via text messages.

49. During construction, our Deputy CTO communicated Kacific’s Employment and Inclusion Policy Statement to all partners and engaged staffs and briefed them on Kacific ESMP, including the possibility to report grievance directly to him, in confidence. For example, local communities were informed about vehicular movement before start of heavy vehicle carrying materials and machines to Clarke & Pasuruan sites. Meeting with members of the local community and authorities, such as village district head for social environment, are organized to develop the relationship and trust with key stakeholders.

50. All complaints will be acknowledged and recorded in a grievance log maintained by appointed personnel at the Kacific Singapore HQ. The ESMS committee will monitor this grievance log periodically and take the necessary actions when required.

51. For each case, engagement and dialogue will be maintained at operational levels to address and resolve the grievance in a trustful, accessible, transparent and effective way. This will include the following actions:

• Ensure that the process is not hindered by language issues, costs, lack of awareness of the mechanism, or fears of reprisal.

• Provide detailed, accessible and ongoing information on the entire procedure for engagement and dialogue and the progress towards a solution.

• Ensure that the mechanisms and expected outcomes are in line with internationally recognized human rights guidelines.

52. Once the expected outcomes have been determined, Kacific will assess the effectiveness of the outcomes and continue engaging with the stakeholders to ensure the prevention of similar grievances and that lessons are learned.

Kacific – Environment and Social Monitoring Report – February 2020 34 b. Grievances reported and resolution processes

53. So far, no grievance was received by the Kacific Singapore HQ or our Deputy CTO.

Table 8. Grievance cases

Period February 2019 to December 2019 Teleport Site Grievances / Complainant Issues Resolved Action Date and community Dispute Date (Yes/No) Taken Closed Broken Hill None n/a n/a n/a n/a n/a (Australia) Subic None n/a n/a n/a n/a n/a (Philippines) Clark None n/a n/a n/a n/a n/a (Philippines) Surabaya None n/a n/a n/a n/a n/a (Indonesia) Pasuruan None n/a n/a n/a n/a n/a (Indonesia)

Kacific – Environment and Social Monitoring Report – February 2020 35