ADB-Financed Western Regional Roads Development Project Phase II ENVIRONMENTAL IMPACT ASSESSMENT REPORT August 2010 The environmental impact assessment 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. CURRENCY EQUIVALENTS (as of June 2010) Currency Unit = Mongolian Tugrug (Tg) 100 Tg = $0.072 $100 = 137,500 Tg The exchange rate of the Tg is determined under a floating exchange rate system. In this report, the rate used is the rate prevailing at the above date. ABBREVIATIONS ADB — Asian Development Bank ADT — average daily traffic AMa — absolute maximum AMi — absolute minimum EIA — environmental impact assessment GOM — Government of Mongolia GRM — Grievance Redress Mechanism KUNNP — Khar-Us Nuur National Park MESC — Ministry of Education, Science, and Culture MLEIA — Mongolian Law on Environmental Impact Assessment MLEP — Mongolian Law on Environmental Protection MNET — Ministry of Nature, Environment and Tourism MOF — Ministry of Finance MRTUCD — Ministry of Road, Transport, Construction and Urban Development NAMHEM — National Agency of Meteorology Hydrology and Environmental Monitoring Agency NGO — Non-Governmental Organization NM — National Monuments NP — National Parks NR — Natural Reserves NSO — National Statistical Office PCC — Public Complaints Center PIU — Project Implementation Unit PRC — People’s Republic of China SE — supervising engineer WEIGHTS AND MEASURES о С — degrees of celsius cm — centimeter ha — hectare km — kilometer Km/h — kilometer per hour m — meter mg/m3 — Milligrams per cubic meter NOTES (i) The fiscal year of the Government and its agencies ends on 31 December. (ii) In this report, "$" refers to US dollars. TABLE OF CONTENTS 1 EXECUTIVE SUMMARY 1 1.1 Introduction 1 1.2 Critical Facts 1 1.3 Significant Findings 11 1.4 Recommendations 20 2. INTRODUCTION 23 2.1 Background 23 2.2 EIA Preparation 24 2.3 Associated Project Components 25 2.4 Report Structure 26 3. POLICY LEGAL AND ADMINISTRATIVE FRAMEWORK 28 3.1 Environmental Policy 28 3.2 Environmental Law 30 3.3 Environmental Impact Assessment Requirements 33 3.4 Administrative Framework 36 4. DESCRIPTION OF THE PROJECT 41 4.1 Type of Project 41 4.2 Description of the Proposed Actions 41 4.3 Bill of Quantities (BOQ) for the Project 44 4.4 Need for the Project 45 4.5 Environmental Category of ADB 45 4.6 Project Location 46 4.7 Associated Project Components 48 4.8 Associated Facilities 49 4.9 Traffic Projections 51 4.10 Implementation Schedule 51 5. DESCRIPTION OF THE ENVIRONMENT 53 5.1 Environment of Mongolia 53 5.2 Assessment Process 53 5.3 Definition of the Project Area 53 5.4 Physical Resources 54 5.5 Ecological Resources 70 5.6 Economic Development 81 5.7 Social and Cultural Resources 85 6. ALTERNATIVES 101 6.1 Alternative Analysis 101 6.2 No-action alternative 101 6.3 Location Alternatives 101 6.4 Technological Alternatives 106 7 ANTICIPATED ENVIRONMENTAL IMPACTS AND MITIGATION MEASURES 108 7.1 Screening of Potential Impacts 108 7.2 Anticipated Environmental Impacts 109 7.3 Topography and Soils 110 7.4 Permafrost Degradation 113 7.5 Natural Disasters 115 7.6 Climate and Air Quality 116 7.7 Surface and Groundwater Hydrology 118 7.8 Noise and Vibration 119 7.9 Solid Waste 120 7.10 Flora 121 7.11 Fauna 121 7.12 Protected Natural Area 124 7.13 Relocation 124 7.14 Non-transport Infrastructure 125 7.15 Transport Infrastructure 125 7.16 Historical and Cultural Heritage 126 7.17 Health Issues 126 7.18 Construction Camp Impacts and Management 126 7.19 Associated Section 127 7.20 Cumulative and Induced Impacts 128 7.21 Possible Change in Alignment 128 8. ECONOMIC ASSESSMENT 130 8.1 Environmental Protection Investments 130 8.2 Environmental Costs 131 8.3 Environmental Benefits 131 9 PUBLIC CONSULTATION AND INFORMATION DISCLOSURE 133 9.1 Stakeholder Workshops 133 9.2 First Round 133 9.3 Consultations with Government Officers and Experts 134 9.4 Other Public Consultations 136 9.5 Consultations within the Project Area 136 10 GRIEVANCE REDRESS MECHANISM 138 10.1 Introduction 138 10.2 Current Practice 138 10.3 Proposed Grievance Redress System 139 10.4 Responsibilities of PCC 140 11. ENVIRONMENTAL MANAGEMENT PLAN 142 11.1 Environmental Safeguards 142 11.2 Mitigation Measures 142 11.3 Implementation 147 11.4 Implementation Schedule 148 11.5 Environmental Cost Estimate 149 11.6 Institutional Arrangements 149 11.7 Capacity Building 151 11.8 Environmental Monitoring 151 12 CONCLUSION 153 Appendix I: Environmental Management Plan Appendix II A: Climate Variables Appendix II B: Water Quality Appendix II C: List of Flora and Fauna Appendix II D: Historical and Cultural Heritage Appendix II E: Project Alignment Maps 1 EXECUTIVE SUMMARY 1.1 Introduction 1. Purpose of the project. The Government of Mongolia, acting through its Ministry of Road, Transport, Construction and Urban Development (MRTCUD), has undertaken the upgrading of the Western Regional Road Corridor with various funding arrangements and the 147.9 km road section from Khovd to Buraatyn Davaa is an integral part of the said road corridor. The development of the road section from Khovd to Buraatyn Davaa (herein after referred to as the Project) has been identified for financial assistance from the Asian Development Bank (ADB). 2. Scope of work. The scope of work for the preparation of the EIA was as follows: collection of information related to the environmental conditions along the proposed road section, assessment of potential location specific environmental impacts, development of preventive/mitigation measures for significant impacts, evaluation of alternative alignment proposed and alternative technologies, economic assessment of environmental benefits and costs, preparing Environmental Management and Monitoring Plans (EMP, Appendix I), and limited public consultations. 1.2 Critical Facts 1.2.1 Legal and Administrative Framework a. Legal Framework 3. Mongolia’s environment legal framework is similar to international practices and is structured as shown in Table 1 below. Table 1: Key Environmental Legislation in Mongolia Name of the Law Year Adopted The Constitution of Mongolia 1992 Law on Environmental Protection 1995, revised in 2006 and 2008 Law of Land Jun 2002 Law on Land Cadastre and Mapping Dec 1999 Law on Land Fees Apr 1997 Law on Land Possession Jun 2002 Law on implementation of regulations related to Land Possession Law Jun 2002 Law on Geodesy and Cartography Oct 1997 Law on Special Protected Areas Nov 1994 Law on Buffer Zones Oct 1997 Law on Water Apr 2004 Law on Water and Mineral Water Resource Fee May 1995 Law on Forests Mar 1995 Law on Fees for Timber and Fuel wood Harvesting May 1995 Law on Prevention of Steppe and Forest Fires May 1996 Law on Reinvestment of Natural Resource Use Fees for Conservation Jan 2000 Law on Natural Plants Apr 1995 Law on Natural Plant Use Fees May 1995 Law on Protection of Plants Mar 1996 Law on Hunting 2000, 2003 Law on Fauna 2000 Law on regulation of export and import of endangered species of flora and Nov 2002 fauna Law on Hunting Reserve Use Payments and on Hunting and Trapping May 1995 Authorization Fees Law on Underground Resources Dec 1994 Law on Minerals 1997, revised in 2006 Petroleum Law 1991 2 Name of the Law Year Adopted Law on Air Mar 1995 Law on Hydrometeorology Nov 1997 Law on Protection from Toxic Chemicals Apr 1995 Law on Environmental Impact Assessment 1998, revised in 2002 Law on Tourism 1998 Law on Solid Waste Nov 2003 Law on prohibiting export and transportation of Hazardous Waste Nov 2000 Source: UNDP. 2008. Institutional Structures for Environmental Management in Mongolia. Ulaanbaatar. b. EIA Requirements 4. The Project will be subject to the environmental requirements of both Mongolia and those of the ADB. These requirements are as follows. 5. EIA requirements of ADB. Projects are screened for their expected environmental impacts and assigned to one of the following four categories: (i) Category A: projects with potential for significant adverse environmental impacts—an environmental impact assessment (EIA) is required to address significant impacts, (ii) Category B: projects judged to have some adverse environmental impacts, but of lesser degree and/or significance than those for category A projects - an initial environmental examination (IEE) is required to determine whether or not significant environmental impacts warranting an EIA are likely, (iii) Category C: projects unlikely to have adverse environmental impacts—no EIA or IEE is required, although environmental implications are still reviewed, and (iv) Category FI: projects are classified as category FI if they involve a credit line through a financial intermediary or an equity investment in a financial intermediary—the financial intermediary must apply an environmental management system, unless all subprojects will result in insignificant impacts. 6. EIA Requirements of Mongolia. The EIA requirements of Mongolia are regulated by the Law on Environmental Impact Assessment. The type and size of the planned activity determine whether the responsibility lies with either the Ministry of Nature and Environment (MNE) or aimag government. There are two types of EIAs defined in the Law: General EIA and Detailed EIA. 7. Figure 1 provides a simplified diagram of the EIA procedure in Mongolia. 3 Figure 1: EIA Procedure in Mongolia MNET or Local Government Prior to implementation, project appoints