MONITORING & IMPLEMENTATION REPORT VCS Version 3, CCB Standards Third Edition

MONITORING & IMPLEMENTATION REPORT

Prepared by:

Project Title Amazon Rio REDD+ IFM

Redução de Emissões de GEE pela Degradação Evitada

Version 1.3

Report ID MIR_EBCF_REDD_0116

Date of Issue 17 - August - 2012 to 29- March -2016

Project ID MIR_EBCF_REDD_0116

Monitoring Period 17 - August - 2012 to 29- March -2016

Prepared By Original Trade Consultoria Especializada

Contact Avenida André Araújo, 2936 – Edifício Incubadora do INPA, sala 10, Cep. 69.060-000, Manaus-AM, .

0055 92 981590997; [email protected]; originaltrade.net

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Project Name Amazon Rio REDD+ IFM

Reduction of GHG emissions avoided by degradation

Localization Brazil, Amazonas State, Manicoré City. Project

Project Proponent EBCF – Empresa Brasileira de Conservação Florestal Contato: Leonardo Barrionuevo (CEO) [email protected] – fone +1 305- 321-4577

Auditor Rainforest Alliance (Klaus Geiger [email protected]; Tel: +1 (802)923-3766) e Imaflora (Bruno B. Souza, [email protected]; Tel +55 (19) 98324 5522.

Project start date August 17, 2012; crediting period of 37 years, 37 years of project time (can be extended for longer).

Period Covered by 17 - August - 2012 to 29- March -2016 the PIR

Historical status No history; first proposition (Validation and Initial verification) CCBA

Edition CCBA CCBA. 2013. Climate, Community & Biodiversity Standards Third Edition. Standard CCBA, Arlington, VA, USA. December, 2013. At: www.climate-standards.org

Summary of the As expected, there was no logging activity in the project areas as occurred results generated effective control of deforestation in both areas of the project and in the by the project surrounding communities. With this, REDD + project EBCF shows a reduction of emissions in the order of 430,873.68 tCO2e to the balance sheet reductions and emissions between the years 2011 until 2015. The project conducted a sense of basic social conditions, the activities of zoning and implementation of sustainability matrix. This set of instruments will be used for the planning of future activities as well as measure the different dimensions of local social progress. The benefits to biodiversity present in the drastic reduction of

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deforestation since the project implementation. Also, if conducted preliminary studies on the management plan to monitor the practice of hunting in the area. It was also initiated the activities related to health and income generation in partnership with local communities.

Gold Level Criteria On the climate issue is understood that balanced ecosystems have greater ecological and social resilience and adaptability to climate change, whether through the protection of water bodies and flow regulation of rivers on the peaks of flood and drought, is the regular supply food products and environmental services. From the social point of view the project has a strong presence along the clearly marginalized populations the social care system of the State and was strategies interact with the communities to give more visibility to women, elderly and children. Exceptional benefits for biodiversity are realized on the fact that the project present several qualifying attributes of "High Conservation Values", such as endemic species and / or rare and have several species protected by specific legislation prohibiting cutting, such as the Brazil Nuts tree, rubber tree and mahogany.

Date of Completion of this 10 September 2016. PIR

Expected schedule Periodic every 5 (five) years. check

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SUMÁRIO 1 GENERAL ...... 11 1.1 Summary Description of the Project ...... 11

1.2 Project Objectives ...... 13

1.3 Project Location ...... 14

1.4 Conditions Prior to Project ...... 18

1.5 Project Proponent (G4) ...... 28

1.6 Other Entities Involved in the Project (G4) ...... 28

1.7 Project Start Date ...... 29

1.8 Project Crediting Period ...... 29

2 DESIGN ...... 29 2.1 Sectoral Scope and Project Type...... 29

2.2 Description of the Project Activity...... 30

2.3 Management of Risks to Project Benefits ...... 36

2.4 Measures to Maintain High Conservation Values (HCV) ...... 39

2.5 Project Financing ...... 49

2.6 Employment Opportunities and Worker Safety ...... 50

2.7 Stakeholders (G3) ...... 51

3 LEGAL STATUS ...... 54 3.1 Compliance with Laws, Statues, Property Rights and Other Regulatory Frameworks...... 54

3.2 Evidence of Right of Use ...... 56

3.3 Emissions Trading Programs and Other Binding Limits ...... 57

3.4 Participation under Other GHG Programs ...... 58

3.5 Other Forms of Environmental Credit ...... 58

3.6 Projects Rejected by Other GHG Programs ...... 58

3.7 Respect for Rights and No Involuntary Relocation ...... 58

3.8 Illegal Activities and Project Benefits ...... 62

4 APPLICATION OF METHODOLOGY ...... 62 4.1 Title and Reference of Methodology ...... 62

4.2 Methodology Deviations ...... 62

4.3 Project Boundary ...... 63

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4.4 Baseline Scenario ...... 68

4.5 Additionality ...... 68

5 MONITORING ...... 79 5.1 Monitoring Plan Description ...... 79

5.1.1 Monitoring of Climate Impacts ...... 79

5.1.2 Monitoring Impacts to Biodiversity ...... 85

5.1.3 Monitoring Social Impacts ...... 87

5.2 Data and Parameters Available at Validation ...... 88

5.3 Data and Parameters to Be Monitored ...... 97

6 MEASUREMENT OF GHG EMISSIONS REDUCTIONS AND REMOVALS (CLIMATE) ...... 123 6.1 Emissions Baseline ...... 123

6.2 Project emissions ...... 123

6.3 Leakage ...... 124

6.4 Summary of GHG Emission Reductions and Removals ...... 124

6.5 Climate Change Adaptation Benefits (GL1) ...... 124

7 COMMUNITY ...... 125 7.1 Positive Impacts for Communities (CM1) ...... 125

7.2 Negative Impacts (CM2) ...... 129

7.3 Exceptional Benefits for Communities (GL2) ...... 129

8 BIODIVERSITY ...... 130 8.1 Positive Impacts for Biodiversity (B1) ...... 130

8.2 Negative Impacts on Biodiversity (B2) ...... 131

8.3 Exceptional benefits for Biodiversity (GL3) ...... 131

9 ADICIONAL INFORMATION ...... 131 References ...... 132

TABLES

Table 1: Implementation schedule and next activities...... 32 Table 2. Endangered plant species in the areas of the Amazon Rio project (using forest inventory information conducted by EBCF and considering the Red List of endangered species (footnote IUCN). . 42 Table 3.Endangered species in the Amazon Rio project and surrounding areas...... 44 Table 4. Species endemic to the Southwest Amazon ...... 45 Table 5.Project implementation and operational costs ...... 50

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Table 6.Greenhouse gas emissions sources and sinks associated with baseline and project activities ... 67 Table 7.Summary of areas managed since 1999 ...... 68 Table 8.Internal Rate of Return (IRR) and Net Present Value (NPV) of various SFM activities and REDD+ project activities ...... 72 Table 9. Sensitivity analysis under different scenarios with variations of +5%, +10% and +20% in CRA prices ...... 73 Table 10.Sensitivity analysis given variations of -5%, -10% and -20% in the project administrative costs29 ...... 73 Table 11. 2011-2016 Project Activity Emissions ...... 123 Table 12. Summary of ex ante estimates ...... 124

FIGURES

Figure 1: Location of the Municipality of Manicoré - AM...... 14 Figure 2: Project area location...... 15 Figure 3: Project Zone and communities of the project...... 16 Figure 4: Illegal Wood in the Amazon (2009). SFB/IMAZON (2010) ...... 37 Figure 5: Areas of importance for biodiversity conservation in the Amazon (According to the Ministry of the Environment (2007) review it is possible to see that the areas of the Amazon Rio II and III are part of the "extremely high" classification for biodiversity conservation ...... 40 Figure 6. Workshop I: Free, Prior and Informed Consent for the development of the REDD+ project by the community leaders of Democracia, Água Azul, São José do Miriti, Vista Alegre, Jatuarana, Terra Preta do Ramal, Pandegal, Santa Maria, Santa Eva and Terra Preta do Rio Mancoré...... 60 Figure 7.Workshop II: Free, Prior and Informed Consent for the development of the REDD+ project by the community leaders of Urucury, Mocambo, Boa Esperança and São João & Ponta Grossa...... 61 Figure 8 Workshop III: Free, Prior and Informed Consent for the development of the REDD+ project by the Kamayuá indigenous community ...... 61 Figure 9. a) Project direct interference boundary and b) total project area ...... 63 Figure 10. Project Area forest types ...... 64 Figure 11. Map of the managed UPAs ...... 66 Figure 12. Water Filters installed in 10 communities. A student of the Democracy Community School consuming clean filtered water...... 127 Figure 13. Vitor Belfort performing a lecture to locals at Democracy community - 2015 ...... 129 Figure 14. EBCF REDD Project and buffer áreas deforestation figures (source: HDOM Report)...... 130

ANNEXES

ANNEX 1. Operations License Summary (Resumo das LOs)

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ANNEX 2. Logging Plan “Valdenor II” (Plano de Manejo Valdenor II)

ANNEX 3. Logging License Registration, PAAM (Cadastro para exploração florestal, PAAM)

ANNEX 4. Operations Licenses and Annual Production Units (LOs and UPAs)

ANNEX 5. Vegetation Maps (Mapas de Fitofisionomia)

ANNEX 6. Annual Operation Plan and Forest Logging Authorization (POAs a AUTEX)

ANNEX 7. Forest Inventory 100% UPA 6 (Inventário Florestal 100% UPA 6 (2007))

ANNEX 8. Expedited Forest Inventory - 2013 (Inventario Florestal Expedito - 2013)

ANNEX 9. Amazon Rio I RPDS Management Plan (Plano de Gestão da RPDS Amazon Rio I

ANNEX 10. Free, Prior and Informed Consent (FPIC) (Consentimento Livre Previo e Informado)

ANNEX 11. Land Titles (Escrituras)

ANNEX 12. Support Letters from Government Bodies (Cartas de apoio dos órgãos do Governo)

ANNEX 13. Sales Declaration from Gethal (Declarações de venda Gethal)

ANNEX 14. Gethal SmartWood Certification (Certificação SmartWood Gethal)

ANNEX 15. Greenpeace article on timber companies in the Amazon (Relatório Greenpeace sobre

madeireiras da Amazônia)

ANNEX 16. Cash Flow Analysis (Análise fluxo de caixa)

ANNEX 17. Financial Analysis – Baseline and Additionality (Análise financeira – linha de base e

adicionalidade)

ANNEX 18. Emissions Calculation Spreadsheet (Planilha de calculos de emissões)

ANNEX 19. EBCF Core-business (Core-business da EBCF)

ANNEX 20. EBCF’s Undertanding of Project Risks and Barriers (Entendimentos da EBCF sobre

riscos)

ANNEX 21. EBCF’s Energy Use and Transport (EBCF consumo de energia e transporte)

ANNEX 22. Non-Permanence Risk Analysis/Buffer (Análise de risco de não permanência/buffer)

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ANNEX 23. Forest Biomass Inventory - 2016 (Inventário de Biomassa Florestal - 2016)

ANNEX 24. Deforestation repport_ 2016 (Relatório Técnico Desmatamento_2016)

ANNEX 25. Consultive Concill (Documento conselho consultivo)

ANNEX 26. Community Sensus (Senso Comunidades 2013)

ABBREVIATIONS

AFOLU: Agriculture, Forestry and Other Land Use ANTAQ: National Agency for Waterway Services (Agência Nacional de Transportes Aquaviários) AP: Project Area APD: Avoided Planned Deforestation APP: Areas of Permanent Preservation (Áreas de Preservação Permanente) ATER Technical Assistance and Rural Development (Assistência Técnica e Extensão Rural) AUTEX: Logging Authorization (Autorização de Exploração Florestal) CAAD: Council of Agro-Extrativist Associations of Democracia (Conselho das Associações Agroextrativistas de Democracia) CAAM: Council of Agro-Extrativist Associations of Manicoré (Conselho das Associacoes Agroextrativistas de Manicoré) CDM: Clean Development Mechanism CFI: Continuous Forest Inventory CNS: National Council of Extractivist Populations (Conselho Nacional das Populações Extrativistas) CRA: Environmental Reserve Quotas (Cotas de Reserva Ambiental) DBH: Diameter at Breast Height DETER: Real Time Deforestation Detection System DOF: Document of Forest Origin (Documento de Origem Florestal) EIA: Environmental Impact Assessment FAS: Amazonas Sustainable Foundation (Fundação Amazonas Sustentável) FSC: Forest Stewardship Council FUNAI: National Indigenous Peoples Foundation (Fundação Nacional do Índio) GHG: Greenhouse Gases GIS: Geographic Information System HCV: High Conservation Value IBAMA: Brazilian Institute of Environment and Renewable Natural Resources (Instituto Brasileiro do Meio Ambiente e dos Recursos Naturais Renováveis)

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ICU: Intensive Care Unit IDAM: Institute of Agricultural and Forestry Development of the State of Amazonas (Instituto de Desenvolvimento Agropecuário e Florestal do Estado do Amazonas) IEA: International Energy Agency IIEB: International Institute of Education of Brazil (Instituto Internacional de Educação do Brasil) IFM-LtPF: Improved Forest Management - Logged to Protected Forest IMAZON: Institute of Man and Environment in the Amazon (Instituto do Homem e Meio Ambiente da Amazônia. INPE: National Institute for Space Research (Instituto Nacional de Pesquisas Espaciais) IPAAM: Amazon Institute of Environmental Protection (Instituto de Proteção Ambiental do Amazonas) IPCC: Intergovernmental Panel on Climate Change LR: Legal Reserve (Reserva Legal) MCT: Ministry of Science and Technology (Ministério da Ciência e Tecnologia) MMA: Ministry of Environment (Ministério do Meio Ambiente) MP: Monitoring Plan NTFP: Non-Timber Forest Product PD: Project Description PES: Payment for Environmental Services POA: Annual Operational Extraction Plan (Plano Operacional Anual de Extração) PPE: Personal Protective Equipment PROARCO: Program for the Prevention and Control of Forest Fires in the Arc of Deforestation (Programa de Prevenção e Controle às Queimadas e Incêndios no Arco do Desflorestamento) PROBUC: Program for Monitoring Biodiversity and Use of Natural Resources in Conserveation Units (Programa de Monitoramento da Biodiversidade e Uso do Recursos Naturais em UCs) PRODES: Program to Calculate Deforestation in the Amazon (Programa de Cálculo do Desflorestamento da Amazônia) RDS: Sustainable Development Reserves (Reservas de Desenvolvimento Sustentável) RPDS: Private Reserves for Sustainable Development (Reserva Particular de Desenvolvimento Sustentável) RPPN: Private Reserve of Natural Heritage (Reserva Particular do Patrimônio Natural) SAD: Deforestation Allert System (Sistema de Alerta de Desmatamento) SDS: Secretary of the State for the Environment and Sustainable Development of Amazonas (Secretaria de Estado do Meio Ambiente e Desenvolvimento Sustentável do Amazonas) SEUC: State System of Conservation Units (Sistema Estadual de Unidades de Conservação) SFM: Sustainable Forest Management

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SFMP: Sustainable Forest Management Plan UC: Conservation Units (Unidade de Conservação) UEA: State University of Amazonas (Universidade Estadual do Amazonas) UFAM: Federal University of Amazonas (Universidade Federal do Amazonas) UNFCCC: United Nations Framework Convention on Climate Change UPA: Annual Production Unit (Unidade Produtiva Anual) VCU: Verified Carbon Unit WBCSD: World Business Council for Sustainable Development WRI: World Resources Institute

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1 GENERAL

1.1 Summary Description of the Project

The Amazon Rio project consists of the conservation of a mosaic of four private areas called Amazon Rio I, II, III and IV, which add up to 20,387 hectares (ha) of primary forest, located in the municipality of Manicoré in the state of Amazonas. The project's target area is characterized by being a region of sedimentary Solimões Basin, dominated by Alluvial Holocene, Içá and Detritus- lateritic formation. The relief is of the flat type with primary vegetation formation consisting of areas of land, floodplain and some formations igapó due to the influence of Rio Manicoré.

The Amazon Rio areas dominated forests of humid tropical rainforest Lowlands emerging Canopy and Forest Open Rain Lowlands with palm trees (79%), the Atlantic rain forest Alluvial emerging canopy (11%), Rain Forest Open Alluvial with palm trees (8%), Pioneer formations influenced fluvial and /or lacustrine - herbaceous and shrubby with palm trees (1%).

The main focus of the project is: (i) the conservation of forest ecosystems and biodiversity; (ii) the sustainable social development of the region, including the promotion of ecotourism and scientific

research, and (iii) the reduction in carbon dioxide (CO2) emissions through the prevention of deforestation and forest degradation.

In 1998, a logging plan for logging activities was approved by the authorized environmental agencies on 19,800 ha of land over a period of 25 years (the total area does not include Permanent Preservation Areas (APP) and water bodies. Between 1999 and 2010, 4,347.69 ha were degraded due to an authorized logging operation (Annexes 1, 2, 3 and 4). In February 2011, the area was acquired by the Empresa Brasileira de Conservação de Florestas (EBCF) which, in order to implement the objectives of the project, made two important decisions: to suspend the logging operations underway in the project areas since 1999 and transform them into Private Reserves for Sustainable Development (Reservas Particulares de Desenvolvimento Sustsentável - RPDSs), supported by State Law no. 53 of June 2007 and Decree no. 30,108 of June 2010.

It is important to mention that only the Amazon Rio I area was approved in June 2013 by the Secretary of Environment and Sustainable Development of Amazonas (SDS), through Directive/SDS/no. 86/2013. The other Amazon Rio II, III and IV private areas are in the process of analysis within the SDS for future approvals. The proposal is that the four areas form an integrated system of private conservation units managed by EBCF through one Management Plan1.

1 Although the Management Plan (Annex 9, in draft and now awaiting approval from CEUC) formally addresses the Amazon Rio I Private Reserve, the other areas, Amazon Rio II, III, IV, were included in the study. The strategy is that with future homologations the other Reserves will be formally included in the same Management Plan.

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With this new land use strategy 20,387 ha of primary forest will be preserved, avoiding the CO2 emissions that would have occurred without the implementation of the project. Revenues obtained from the carbon credits will be used to maintain the primary forest with the implementation of the activities described in the Reserve’s Management Plan (Annex 9), including social programs and environmental monitoring.

The project intends to maintain financial sustainability through the sale of carbon credits obtained from the conservation of the area and maintenance of environmental services. Another source of income planned by the project relates to the national market for legal reserve compensation (Environmental Reserve Quota (Cotas de Reserva Ambiental (CRA) in Portuguese)2. Using these two financial mechanisms for conservation, the emission of approximately 2 million tons of carbon dioxide into the atmosphere over a period of 38 years will be avoided.

It is important to emphasize that the project area is crucial for conservation, especially considering its characteristics, such as (i) high biological diversity and concentration of endemic and pharmacological species (Section 7); (ii) extensive areas of plains, which are important for the reproduction and survival of many species of plants and , especially birds and reptiles, and (iii) high potential for ecotourism and environmental education, including scientific research.

The creation of these private reserves also contributes to the consolidation of a strategy to establish ecological corridors and mosaics in the region, creating a territorial connection between public and private conservation areas. This situation reduces potential conflicts between the state, landowners and residents in the buffer areas and creates opportunities for implementing integrated actions, optimizing human and financial resources for environmental monitoring and control actions.

Another important fact to consider is the surrounding communities who use the project areas for their own subsistence, extracting non-timber forest products (e.g., nuts, fruits, oils, vines), fishing and hunting. For that reason they have direct interest in the conservation of the forest to obtain food, economic security and maintain their cultural practices.

The environmental benefits that the communities receive make them "guardians" of the forest, contributing significantly to the monitoring and controlling of illegal activities practiced in the region such as logging, fishing and poaching, as well as supervision and control of forest fires. In this context, the Amazon Rio project plays a role of great environmental importance for the region, also contributing to the improvement of livelihoods of the local population and, consequently, to the

2 § 2, Art. 15 of the new Brazilian Forest Code (Law 12.651/2012) provides for voluntary forest reserves, i.e., the excess of forest required by law on rural property. According to this law all preserved area that exceeds the minimum required by law may be used for creation of environmental easement or Environmental Reserve Quotas in the same biome and State.

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conservation of the forest. A population of 450 families distributed among 15 communities is estimated to reside around the area of the Amazon Rio project. Communities are typically "caboclo", whose main economic activity is the family farm cultivation of small-scale, especially cassava for the production of flour and banana. The relationship with the forest is the extraction of non-wood products such as the extraction of copal and collection of Amazonian brown and subsistence hunting. Fishing is also a very important economic activity. The environmental benefits provided by the implementation of the project and Amazon Rio I RPDS Management Plan, and posteriorly including Amazon Rio II, III and IV, demonstrate a strong social development component and includes several socio-economic support programs to local communities which promote sustainable development in the region.

The project will be implemented starting from the introduction of participatory processes, ensuring active involvement of the local communities around the area, as in the aforementioned development programs and in decision-making. The community programs that aim to improve access to health, education and income generation will use the “Bolsa Floresta” program as reference, a program of great relevance for payments for environmental services (PES) in the state of Amazonas. In the medium and long terms these programs intend to significantly improve the living conditions of these communities, strengthening their organizational and institutional capacity, including their productive, environmental and financial sustainability.

1.2 Project Objectives

General objective

The objectives of this project takes a holistic approach to the region and keep full affinity to the recent statement of the United Nations in the design of the seventeen goals of Sustainable Development3 (ODS). In this sense, the project objectives have a direct relationship with some of the ODS and take others as a source of inspiration for the implementation of activities in partnership with local communities. These guidelines will be key elements in the local discussion process around the project activities.

3 The seventeen Sustainable Development Goals at the United Nations are: (1) Ending poverty in all its formase everywhere; (2) Ending eat hunger, achieve food security, improve nutrition; (3) To ensure a healthy life and promote well-being for all; (4) To ensure inclusive education, equitable and quality; (5) Achieving gender equality and empower all women; (6) Ensure availability and sustainable water management; (7) Ensure acessoà energy, reliable and sustainable; (8) To promote sustained, inclusive and sustainable economic growth; (9) Building resilient infrastructure, promote inclusive industrialization; (10) To reduce inequality between and within countries; (11) Making cities inclusive human settlements, secure, resilient; (12) To ensure standards of sustainable consumption and production; (13) Take urgent action to combat climate change; (14) To preserve and promote the sustainable use of the oceans; (15) To protect, restore and promote the sustainable use of forests; (16) To promote peaceful and inclusive societies for sustainable development; (17) To strengthen the implementation mechanisms and revitalize the global partnership.

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Thus, it is assumed as a general objective of the project "contribute to the maintenance of global climate (goal 13), through the implementation of activities to prevent the emission of greenhouse gases locally by replacing the forest selective logging for a project conservation of forest biodiversity (goal 15), preserving the traditional culture of the population of surrounding communities (goal 3), promoting income generation (goal 1, 8) and contributing to local social development (goals 2, 5, 4, 6, 7) ".

Specific objectives

Specifically, the project aims to:

1. Implement economic alternative activities to selective logging to generate revenue for the project, benefiting at least 300 families surrounding the target area; 2. Reduce approximately 3.2 million tons of carbon dioxide as a result of project activities; 3. To contribute to the maintenance of regional biodiversity through the preservation and conservation of the forest; 4. Contribute to improve educational processes and attention to regional health; 5. Promote the inclusion and women's empowerment in the project area communities.

1.3 Project Location

Location

The Amazon Rio Project is located in the southern region of the state of Amazonas in the municipality of Manicore (Figure 01). The waterway and air constitute arrival means to the city, with approximate distance of 333 km by air and 427 km by river is the starting point for the city of Manaus, the state capital. The Project areas are near the and between the Sustainable Development Reserves (RDS) Rio Madeira and Rio Amapá (Figure 02).

Figure 1: Location of the Municipality of Manicoré - AM.

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Figure 2: Project area location.

The four project areas include 15 surrounding communities (buffer zone), totaling more than 450 families. The populations living in the buffer zone of the Amazon River areas are known as "caboclo" and are distributed in fifteen communities, with twelve communities (Urucury, Água Azul, Vista Alegre, Boa Esperança, Santa Eva, Santa Maria, Pandegal, Democracia, Jatuarana, Terra Preta do Ramal, Kamayuá e São José do Miriti) are located in the surrounding areas of Amazon River I and III and the RDS Rio Amapá on the banks of the Madeira River and its tributaries. A community formed by the residents of Agroextrativista Association São João and Ponta Grossa, is located close of the Amazon River IV area. Two communities, Terra Preta of Manipur and Mocambo River, located in the surroundings of the Amazon River II on the Manicoré River.

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Figure 3: Project Zone and communities of the project.

Geology and geomorphology

The state of Amazonas is characterized by an extensive phanerozoic sedimentary layer (Paleozoic Era), distributed among the , Solimões, Amazonas and Alto Tapajós basins, deposited on a Precambrian bedrock of igneous, sedimentary and metamorphic rocks (CPRM, 2013).

Particularly, the Amazon Rio areas are located between the Rio Amapá RDS and the municipality of Humaitá and are located in the same sedimentary basin as the Solimões river, with similar soil characteristics: holocenic alluvial soils, Içá Formation and the Dendritic-Lateritic Formation.

The regions where holocenic alluvial soils predominate are characterized by recent detrital deposits of a fluvial, lacustrine or marine nature, consisting of gravel, sand, silt and clay, and transported by water flows over the floodplain. These deposits can be found along the rivers of the region and especially along the Madeira River. In turn, the regions where the Içá Formation prevails are covered by wind-driven deposits, whose rocks and sediments are an important part of the far southeast of the morphoescultural unit of the Amazonic Depression. The endritic-lateritic sediments are covered by layers or levels of sandy and clay soils, composing layers of deep weathered red latosols.

The project area also stands out for being located along a swath of landscape units composed of plateaus with NE-SW directional structures. This aspect contrasts with the plateuas of the southern

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depression (NNW-SSE directional structures), demonstrating that the Madre de Dios – Itacoatiara segment, which governs the entire Madeira river fluvial subsystem – has been an important tectonic agent in controling the flood accumulation areas since the Cenozoic (IGREJA & CATIQUE, 1997).

Topography and soil

This region is characterized by a flat topography and primary vegetation types consisting of areas of dryland (terra firme), floodplains (várzea), and some blackwater flooded Amazonian forests formations (igapó) due to the influence of the Manicoré River. Plains predominate and are characteristically flat and usually rise only a few meters above sea level, but they may also rise to higher altitudes. In this form of topography, the deposition of materials outstrips erosion.

Specifically in the Amazon Rio area the dense Primary Tropical Ombrophylous Lowland Forest and open Primary Tropical Ombrophylous Lowland Forest with palm trees (79%), Dense Primary Tropical Ombrophylous Alluvial Forest (11%), Open Primary Tropical Ambrophylous Alluvial Forest with palm trees (8%), Pioneer Formations with fluvial and/or lacustrine influence - herbaceous and shrubby vegetation with palm trees (1%) (Annex 5).

According to IBGE's soil database (2000), the Manicoré region is formed mainly of Latosols and Argisols. Also soils such as Gleysols, Spodosols, Alluvial soils, Neosols, Planosols, Plinthosols and Nitosols can be found. The Brazilian Soil Classification System, produced from surveys by the Brazilian Agricultural Research company (EMBRAPA), between 2001 and 2006, corroborates the classification information for that region.

Latosols are deep mineral soils that have suffered heavy weathering and so are virtually devoid of primary or secondary minerals, in addition to presenting low nutrient reserves. As a consequence of the high degree of weathering and poor source of material, these soils are generally very acidic, low in available nutrients and feature high exchangeable aluminum content. As in most weathered soils, organic matter plays a fundamental role in the process of plant nutrition and nutrient cycling.

Argisols generally vary with respect to depth. Their drainage quality can vary from high to poorly drained. Morphologically, they feature yellowish or reddish tones, but can also be brown or gray. These soils have a very low natural chemistry with the absence of mineral nutrients reserves.

Alluvial soils are very common in this region. These soils are found mainly on the banks of the Madeira River. The fertility levels are dystrophic and located on flat terrain. Agricultural and livestock activities are almost always practiced along the main alluvial stretches of the region. The most fertile soils that occur on the floodplains (várzea) are widely cultivated for temporary crops such as beans, rice, watermelon and cassava.

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Climate and hydrography

The climate in the region of the Madeira River is humid equatorial (IBGE, 2011), with an average temperature of 27°C, relative humidity ranging between 85 and 90% and annual rainfall between 2,200 to 2,800 mm/year (RADAMBRASIL, 1974). Studies from the Amapá Rio RDS area indicate that between the months of January and March rainfall intensity is greater, with monthly rainfall between 300 and 350 mm, while the driest months are July and August, with monthly averages around 50 mm.

Geographically, the Amazon region is defined by watersheds formed by the rivers, which flow into the Amazon Rio and its mouth, along the entire East coast of Brazil (RIBEIRO et al., 1999). The city of Manicoré is influenced mainly by the Madeira and Manicoré rivers which are, respectively, white and black water rivers and contribute to the local climatic conditions, combined with the characteristics of the vegetation that includes forests, meadows, savanna (cerrado) and floodplains (várzeas).

The Madeira River drains three main morpho-structural units: the (15%), the Brazilian shield (41% of the basin) and the Amazon plain (44%). The Manicoré River is located in the last two formations. The smaller rivers, or tributaries of Madeira River are: Manicoré River, Aripuanã River, Marmelos River and Canumã River, all located along its right bank.

1.4 Conditions Prior to Project

Before the conservation project, the most important economic activity in the area was timber logging using a sustainable logging plan and authorized by government environmental agencies in 1998 (Appendices 1, 2, 3, 4, and 6).

This activity began in 1999 after authorization for selective logging was granted on 97% of the property for a period of 25 years and concluded in 2010 with the initiation of discussions about the creation of private conservation units. On the occasion of the approval of the timber logging plan, the project proponent (EBCF) still had no knowledge of the area, nor did it plan to purchase the land for conservation purposes or non-timber forest management. Therefore the timeline and duration of events described above rule out any doubts as to the possible implementation of a timber logging plan with a view for creating a baseline scenario for greenhouse gas (GHG) emissions, for further development of an emissions reduction project.

Economic context of land use

Southern Amazonas is an important region strategically to prevent advances in deforestation in the Amazon. However, in recent years, the region has been suffering successive deforestation events from expanded farming activities, contributing to the so-called "arc of deforestation" toward the

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state of Amazonas. Historically, the "arc of deforestation" has advanced with the expansion of agriculture in the states of Pará, Mato Grosso, Rondônia, Tocantins and Maranhão. In recent years, pressures on forests have increased with the globalization of markets for meat and soybeans in the Amazon and international development policies for the region (IDESAM, 2011).

In this scenario of increasing deforestation, the forests in southern Amazonas are critically endangered, as well as the great biological diversity harbored within its heterogeneous environments, including endemic species of extreme relevance to the conservation of the Amazonian biodiversity (IDESAM, 2011).

Timber companies from the states of Rondônia and Mato Grosso have migrated into the region near the project area in the municipality of Manicoré, spurring the construction of unofficial roads and contributing to the local economy of the municipality. The migratory flow of people from Rondônia to Manicoré also contributes greatly to the expansion of illegal activities and land conflicts in the region (IDESAM, 2011).

In the Amazon, the timber market has great influence, particularly in the system of land use and occupation which direct impacts the conservation of natural resources. The Brazilian Amazon is among the main producers of tropical wood in the world along with Malaysia and Indonesia, and timber production in Brazil is confined mainly to the states of Pará, Amazonas and Mato Grosso. Production there remains relatively stable, at around 24.5 million m3 between the years 2010 and 2011 (ITTO, 2011). Logging and industrial wood processing are among the main economic activities along with mining and farming (LENTINI et al., 2005). The timber sector is a direct driver of the economy of dozens of municipalities in the Amazon, including Manicoré. According to Lentini et al. (2005) in 2004 this sector generated almost 400,000 jobs in the region, equivalent to 5% of the economically active population, and its gross revenue was R$ 2.3 billion.

The last survey on the Amazon wood market, performed by SFB/IMAZON (2010) reveals significant changes in the market for processed wood. In 1998 only 14% of the total volume produced was exported. In 2004, factors such as a favorable exchange rate and increased demand for Amazonian wood in the European, North American and Asian markets raised the proportion of timber exported to 36%. By 2009, however, the participation of native wood in foreign markets had decreased to 21% of the total production. In that same year, the timber market was essentially domestic, as approximately 79% of the wood volume produced was destined for Brazilian markets. The state of São Paulo (17%) and southern Brazil (15%) were the largest consumers of wood from the Amazon. Another 16% were consumed in producer states (rising from 11% in 2004).

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In this context the prevention of deforestation on private lands through mechanisms of conservation is a major challenge to sustainable development in the Amazon and vitally important.

The four properties that belong to the project area were acquired in February 2011 by Empresa Brasileira de Conservação de Florestas (EBCF) with the main objective to implement forest conservation activities, aiming the protection and enhancement of biodiversity, as well as improving the quality of life of communities living in this environment. These communities have used the non-timber forest resources for generations, within and outside of the project area, as part of their livelihood. Until 2011 and for more than a decade, the project area mainly extracted wood through a sustainable forest logging plan, on a 25-year cycle. In 1998 a selective wood harvest was allowed on 97% of the property, respecting this cycle of 25 years. By 2010, 4,347.69

hectares had been logged and, if the scenario were to continue, an estimated 2 million tons of CO2 would be released into the atmosphere over the next 38 years.

Biological characteristics of the region4

The Amazon is a geographic region that consists of the Amazon tropical rainforest that covers most of the Amazon basin in and is distributed among nine countries. It is the largest watershed on the planet, and the Amazon Rio basin itself is approximately 6.9 million km2, draining 1/3 of South America’s waters. The Amazon territory is also home to the largest rivers in the world: the Amazon Rio, Solimões River, Negro River, Madeira River and the Tapajós River. This profusion of rivers holds 15% of the planet's surface fresh water in liquid form – the world's largest reserve (MEIRELES FILHO, 2006).

The Amazon also has immense biological diversity. It is estimated that its forests and rivers harbor approximately 25% of the known species on the planet, with approximately 60,000 plant species (of which 30,000 are higher plants, including 2,500 species of trees and representing 10% of the world’s plant species), 2,000 species of fish, 300 species of mammals (ALBAGLI, 2001), and over 1000 species of birds (10% of the world).

The Amazon Rio Reserves are located in the Purus-Madeira interfluve, a region of intense ancient anthropic activity, including agriculture, livestock and timber extraction, which is compromising the quality of terrestrial and aquatic ecosystems, such as rivers and streams. However, areas protected by private conservation units still found in an excellent state of preservation, with a great diversity of plants and animals.

Regional studies carried out in South-West Amazon and, particularly near the Madeira River, have shown some of the highest levels of biodiversity in the world. For greater detail on the animal diversity of the Amazon Rio and its surroundings information from surveys and biological

4 This topic is thoroughly discussed in Section 7 of this document.

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inventories conducted in the Rio Amapá RDS were used, which is located near the areas in question.

The data used to analyze the plant biodiversity of the Amazon Rio areas were previously collected from forest inventories of logging on properties in 2007 (Annex 7), as well as from an expedited forest inventory in 2013 (Annex 8) to record forest species richness, following the recommendations of Filgueiras et al., (1994). The existing trail system was used to conduct the inventory.

For the analysis of the animal biodiversity, biological inventory information were used from the Rio Amapá RDS, conducted in 2009 by the Amazonas State Secretary of Environment and Sustainable Development (SDS) and available in the Management Plan (GOVERNO DO ESTADO DO AMAZONAS, 2010).

FLORA

Dryland (Terra firme) forest

The forest inventory of 100% registration of trees in dryland (terra firme) in one of the logged areas Annual Production Unit (Unidade Produtiva Anual - UPA) of the Amazon Rio I (Annex 7) identified 87 species belonging to 30 families and 26 occurrences of the same unidentified species. The forest inventory carried out on a dryland area about 4 km long west of Amazon Rio I yielded 43 species in 20 families, where Fabaceae (16%), Sapotaceae (15%), Arecaceae (12%), Burseraceae (9%) and Lecytidaceae (8%) were predominant. Within these families the main tree species include copal (Protium sp.) and abiurana (Pouteria sp.), species that are abundant and frequently found throughout the region.

The most common species found in the dryland inventory were abiurana branca (Micropholis mensalis), acariquara (Minquartia guianensis), cedrinho (Erisma uncinatum), maparajuba (Manilkara paraensis), massaranduba (Manilkara huberi), pau marfim (Calycophyllum acreanum) and tacacazeiro (Sterculia speciosa). The presence of species of great ecological importance are worth noting, such as Brazil nut (Bertholletia excelsa), copaíba jacaré (Ducke Eperua oleifera), tento (pavonina Adenanthera L.), fava (Abarema sp.), pajurá (Prance Licania laevigata), tauarí (Couratari guianensis Aubl.), arurá (Osteophloeum platyspermum) and jutaí (Pterocarpus sp.).

Among these species, the Brazil nut has contributed significantly to the economy of local residents due to the large-scale commercialization of the seed, which is conducted through a cooperative agreement, COVEMA, and which will be described later.

There was also record of palms such as açaí (Euterpe precatoria), babaçu (Attalea speciosa), caramuri (Pouteria elegans) and patauá (Oenocarpus bataua), widely used as food and caranaí

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palm (Lepidocaryum tenue), whose seeds are used for making handicrafts and its leaves used to cover housing communities in the interior of Amazonas. In general, palm trees species contribute significantly to the plant diversity of the whole region where the Amazon Rio areas are located.

Floodplain (várzea) forests

The expedited inventory in floodplain (várzea) areas found that they are forested with heterogeneous formations, which include tree and shrub species. 103 forest species in 29 families where identified in these forests, including 27 trees not necessarily of the same species and not identified by the local residents.

On floodplains the most abundant plant families are Arecaceae (18%), Euphorbiaceae (15%), Moraceae (9%), Myristicaceae (7%), Chrysobalanaceae (6%), Fabaceae (6%), Sapotaceae (4%), Meliaceae (4%) and Lecythidaceae (4%), mainly represented by seringa or rubber tree (Hevea pauciflora), seringa barriguda (Hevea spruceana), jataúba (Guarea guidonia), apuí (Ficus sp.), assacu (Hura crepitans), andiroba (Carapa guianensis), cedro (Cedrela odorata), muirapiranga (Brosimum angustifolium), muiratinga (Maquira sclerophylla) and virola (Virola cuspidata), also known by the name of ucuúba. All these species are tree species and used for various purposes such as construction, shipbuilding, furniture, packaging and seeds for handicrafts.

On the floodplains large rubber plantations exist with a history of tapping where old and new cuts can be seen in the same tree. Also notable is the occurrence of other species which were logged in the past for their timber value, such as paricá (Schizolobium amazonicum), copaíba mari-mari (Copaifera reticulata), envira de cutia (Scleronema micranthum), garrote (Brosimum utile) e copaiba jacaré (Eperua oleifera), representing approximately 89% of the volume of harvested species, according to the post-exploratory 2006 report of the logging plan (Annex 6 - Vald. II T05 POA, POS, REV. 2006), currently suspended.

Threats to the local flora

In the Amazon Rio project areas the forest species of economic interest have suffered successive removals through selective logging, mainly Eperua oleífera (copaíba jacaré), Brosimum utile (garrote); Scleronema micranthum (envira cutia), Copaifera reticulata (copaíba mari-mari) e Schizolobium amazonicum (paricá), Simarouba amara (marupa), Parkia paraenses (paricarana), Brosimum parinarioides (amapá), Couratari guianensis (tauari branco) and Anacardium giganteum (caju-açu). These were the 10 most logged species in the year 2006 in the areas that are now part of the Amazon Rio RPDS I. These 10 species accounted for 96% of all wood removed from the total of 19 species logged.

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FAUNA

Regarding animal species, biological inventories carried out in the Rio Amapá RDS in the immediate vicinity of the project area indicated the presence of 29 species of mammals, 210 species of birds, 18 species of amphibians and 85 species of fish (GOVERNO DO ESTADO DO AMAZONAS, 2010). Pacas, agoutis, armadillos, deer, spider monkeys, howler monkeys, capuchin monkeys, tapirs, peccaries and catitus are among the main species of animals mentioned by the community during the participatory workshops.

Mammals

Over the course of 82 km of dryland forest, 47 records of medium to large mammals were obtained through visual observation and collected material such as tracks, droppings, and skulls. The presence of 29 species distributed among seven orders were confirmed, as presented in the Rio Amapá RDS Management Plan (2010).

The presence of large carnivores, such as jaguar (Panthera onca) and cougar (Puma concolor), indicates high environmental quality, and may be linked to low anthropic pressure, thus allowing the perpetuation of viable populations of these carnivores (CULLEN JR. & VALLADARES-PÁDUA, 1999). Moreover, the presence of giant otter (Pteronura brasiliensis) in surrounding rivers, as in the Amapá River, can be considered a good indicator of environmental balance and water quality.

Bird species

In the Rio Amapá RDS 210 species of birds have been recorded, four of which are new species: the hawk (gavião in Portuguese) (Leucopternis sp), the antwren (chororozinho in Portuguese) (Herpsilochmus sp.), the tody-tyrant (maria in Portuguese) (Hemitriccus sp), and jay (gralha in Portuguese) (Cyanocorax sp). The geographic distribution of these four new species is limited, probably due to the small Madeira-Purus interfluve.

Another important result was the extent of the distribution of five species along hundreds of kilometers of forest: ocellated crake (maxalalagá in Portuguese) (Micropygia schomburgkii), least nighthawk (bacurauzinho in Portugues) (Chordeiles pusillus), black antbird (chororó-preto in Portuguese) (Cercomacra serva), citron-bellied attila (tinguaçu-de-barriga-amarela in Portuguese) (Attila citriniventris) and wedge-tailed grass finch (canário-do-campo in Portuguese) (Emberizoides herbicola), which indicates the heterogeneity of the area and the availability of resources throughout its length. According to Menger (2011), in the study of the interfluve area of the Purus- Madeira, the inequality in the distribution of species can be explained, in part, by the sensitivity of the species to environmental variations, represented by the composition of palm trees, which are very abundant throughout the region, as stated by the floristic inventories conducted in the region.

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Reptiles

In the Rio Amapá RDS 18 amphibian species belonging to five families were recorded, the most frequent being Hylidae and Leptodactylidae. The dryland forest harbors high richness of poison dart frogs. Colostethus caeruleodactylus has been found in the Autazes region and recently along the Purus River, was found in large numbers on dryland with Brazil nuts trees, near the Amapá River. The area of occurrence of the species has expanded to about 210 km to the South.

Three species of snakes were also identified: Brown-banded water snake (Helicops angulatus), Dendrophidion dendrophis and the pitviper (jararaca in Portuguese) Bothrops sp. in dryland forests. The smooth-fronted caiman (Paleosuchus trigonatus) was registered on the banks of the Amapá River, a species that lives on dryland streams and near larger rivers.

Fish species

The biological inventory of fish in the Rio Amapá RDS surveyed Igarapés (seasonally flooded streams), 9 of which are small streams (1st/2nd order) and two intermediate-sized streams (3rd/4th order).

Spot checks took place on the Amapá River, divided into five parts. 133 species were found, belonging to seven orders and 28 families. These include the contributions of the Characiformes (73 species), Siluriformes (27 species), Gymnotiformes (15 species), Perciformes (14), Beloniformes (2 species) and Synbranchiformes and Cyprinodontiformes (1 species each).

Six species were highly abundant, representing 46.26% of all individuals collected. The most notable were and Hypopygus lepturus, representing 11.28% and 10.99% respectively, followed by the Hyphessobrycon sp. (9.49%), by cf. agassizii (6.09%), the butterflyfish (Carnegiella strigata) (4.54%) and by Hemigrammus gr. Belottii) (3.88%). The number of species recorded in each stream sampled ranged from 16 to 45. The recording of at least three species described as Gladioglanis sp. n., Gymnotus sp. n. "brindle" and Synbranchus sp. is worth noting.

The diversity and distribution pattern of these individuals in relation to their species were very high, and dominance was extremely low, indicating that the water bodies surrounding the Rio Amapá RDS, and near the Amazon Rio areas, shows an excellent state of conservation. In addition, the presence of several species considered rare and even new species with the same genetically viable populations, with an area of reproduction and development of young individuals was confirmed.

However, according to studies by Cardoso (2008), Manicoré presents great diversity of fish species, contributing significantly to the local economy. The main destinations for fishing

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expeditions are the rivers: Madeira (29.5%), Manicoré (16.2%) and Atininga (8.0%), lakes Acará (9.8%) and Boquerão (8.8%) and the Matupiri igarapé (8.1%). The most frequently marketed species are Semaprochilodus spp, pacu (Mylossoma duriventre), Prochilodus nigricans, sardine (Triportheus spp.), jatuarana (Brycon spp.), Curimatidae, Brachyplatystoma rousseauxii, Pseudoplatystoma tigrinum, Anostomidae and Pseudoplatystoma fasciatum. The first 5 species listed are the most heavily commercialized, which represent 75% of the fish marketed in the region.

These numbers may represent, in the medium and long terms, a threat to the conservation of fish species in the region, when management strategies will be necessary to selectively fish the most heavily consumed species.

Threats to local fauna

According to the Chico Mendes Institute for Biodiversity Conservation (ICMBio) the largest biodiversity in the world is located in Brazil. There are more than 100 thousand species of invertebrates and approximately 8,200 vertebrate species: 713 mammals, 1,826 birds, 721 reptiles, 875 amphibians, 2,800 freshwater fish and 1,300 saltwater fish. Within this list, a significant number (627) are listed as endangered species.

The participatory mapping of the natural resources usage system of the surrounding communities of the Amazon Rio areas, conducted by EBCF in 2013, shows that the ,most serious threats to local wildlife are overharvesting of local populations, mostly by commercial fishing and poaching.

According to this map, the fish most commonly caught in streams and lakes are: Cichla sp, Arapaima gigas, tambaqui (Colossoma macropomum), pirapitinga (Piaractus brachypomus), silver arowana (Osteoglossum bicirrhosum), Matrinchã (Brycon amazonicus), jatuarana (Brycon sp) and spotted sorubim (Pseudoplatystoma corruscans). Monitoring the population viability of these species of fish is fundamental for determining if overharvesting of its individuals is occurring, in the sense of direct actions on sustainable management of these resources in the Amazon Rio areas.

As for the hunting of wild animals, the communities surrounding the RPDS put pressure mainly on primate populations such as the howler monkey (Alouatta seniculus), Lagothrix cf., capuchin monkey (Cebus apella); felines like the jaguar (Panthera onca) and cougar (Puma concolor); and herbivores such as tapir (Tapirus terrestres), deer (Mazama sp.) and boar (Pecari tajacu). The hunting activities in the surrounding communities of the Amazon Rio should be constantly monitored, in order to facilitate the implementation of an efficient management system for wild animals. This would ensure the population viability of species that suffer intense pressure, and supply animal protein to local communities.

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Socio-economic, political and cultural characteristics of the communities5

Resident populations in the buffer zone of the Amazon Rio are known as "caboclas” and are divided into fifteen communities, with twelve communities (Urucury, Água Azul, Vista Alegre, Boa Esperança, Santa Eva, Santa Maria, Pandegal, Democracia, Jatuarana, Terra Preta do Ramal, Kamayuá and São José do Miriti) located near Amazon Rio areas I and III and in the Rio Amapá RDS on the Madeira River and its tributaries. A community formed by the residents of the Agroextractivist Association São João e Ponta Grossa, is located in the surroundings of the area Amazon Rio IV. Two communities, Terra Preta do Rio Manicoré and Mocambo, are located in the surroundings of the Amazon Rio II by the riverbank of Manicoré River.

The dwellings are built, preferentially facing the river and are suspended about one meter above the ground. They are usually built of wood and roofed with asbestos or zinc shingles, clay or straw. Few are made of concrete and the poorest families build houses with walls and roofs of straw. In floodland areas, when the flooding is greater than expected, families suspend the floors of houses and in severe cases are forced to migrate to dry land.

The religious orientation of these communities is predominantly Roman Catholic, with only one Evangelical church, located in the community of Terra Preta do Ramal. The Catholicism practiced by these communities is traditional with emphasis on devotion of the Saints and performing rituals such as raising the flag, recitation of novenas and religious festivals of arraias. Many families celebrate annual festivities to honor the patron saints, considered to be the protectors of the communities.

In June of 2013 an update of the number of households, families and population was held in 14 of the 15 surrounding communities of the Amazon Rio, pointing to a total of 1436 people, being the most populous communities: Vista Alegre, Jatuarana, Democracia and Água Azul. As for the age group, during the census conducted in 2013 537 children (0 to 14 years) were recorded, 329 teenagers (15 to 24 years), 484 adults (24 to 65 years) and 99 elderly individuals (over 65 years). (Table 4 of Annex 9).

Almost every community in the surrounding Amazon Rio areas has an elementary school (up to fourth grade) bound to the local authority of the Municipality of Manicoré, with the exception of Santa Eva Community and São João e Ponta Grossa Agroextractivist Association. The main educational centers are the communities of Democracia and Água Azul that offer distance education with High School classes televised at night. The communities of Vista Alegre, Santa Maria, Urucury, Mocambo and Jatuarana have up to the fifth grade of elementary school. There

5 This topic is thoroughly discussed in Section 6 of this document.

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are education programs for young people and adults in four communities: Democracia, Jatuarana, São José do Miriti and Mocambo, although often discontinuous.

Community health workers and midwives are responsible for community healthcare. Almost every community has health workers, with the exception of the communities of Santa Maria, Pandegal and the Agroextractivist Association São João e Ponta Grossa, although this last one, due to its proximity to Manicoré, has easy access to health services. The only clinic available is located in Jatuarana, but it is currently deactivated. Health workers use their own residences, offering a room for emergency care. In more severe cases the health worker accompanies the patient to Manicoré. Generally, residents complain of the lack of support from the Government in providing medicine and the lack of training among health workers.

Most communities, except for Democracia, Vista Alegra, Boa Esperança, Pandegal e Água Azul, use river or igarapé water for human consumption and cooking, very often without proper treatment. This situation significantly raises the occurrence of waterbourne diseases, especially among children. Furthermore most families dig shallow trenches to store water, bringing serious risks of contamination. The most common diseases are endemic, or related to sanitation and nutrition .

Every community has a president for the Community and Church Association, who is chosen by the locals. Community leaders, who can have more than one leadership position, have very defined obligations and are respected for their ability to mediate internal conflicts and to represent the interests of the community with external institutions. They organize parties and seek partnerships to develop social and productive projects that benefit all residents.

As occurs in other regions of the Amazon, these people engage in various activities to assist vulnerable or at risk community members, to increase food security and improve the quality of their lives. They share their time between extractivist, agricultural, fishing and hunting activities. Their cultivation and harvesting practices are predominantly traditional, comprising a rich native heritage.

The communities maintain strong ties to productive activities linked to agriculture, especially the cultivation of cassava used as flour, as well as banana and watermelon, and the extraction of non- timber forest products such as Brazil nuts and to a lesser degree acai, tucuman, rubber and copaiba oil. Meanwhile, the community of Pandegal is exceptional as they engage heavily in mining, though extractivism is also practiced. Apart from agriculture and forestry, governmental aid in the form of social security benefits are important sources of income for these communities.

Despite the wide variety of activities, most families consider the trade in Brazil nuts as their main activity, especially in the communities of São José do Miriti, Democracia, Boa Esperança, Jatuarana, Urucury, Santa Eva and Terra Preta, in which Brazil nuts are harvested preferentially

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from the Rio Amapá RDS and from the Amazon Rio I Private Reserve. Currently, all the communities surrounding the Amazon Rio areas have associations that form a Council of Agro Extrativist Associations of Democracia (Conselho das Associações Agroextrativistas de Democracia – CAAD), which in turn is linked to the Council of Agro Extrativist Associations of Manicoré (Conselho das Associacoes Agroextrativistas de Manicoré – CAAM) and to COVEMA6, responsible for the purchase, processing and marketing of nuts in the region.

1.5 Project Proponent (G4)

Organization Name Empresa Brasileira de Conservação de Florestas S.A. (EBCF)

Contact Person Leonardo Barrionuevo

Title President

Address Curitiba-PR: Al. Dr Carlos de Carvalho 555, Conj. 231 Centro, Curitiba – PR, CEP 80430-180, Brazil Escritório Manaus: Av. Djalma Batista 1661, Conj. 1409 A, Bloco B, Ed. Business Tower, Millenium, Cep 69.050-010, Manaus-AM, Brazil

Telephone +55 41 3158 9800 | +55 41 9943 8005

Email [email protected]

1.6 Other Entities Involved in the Project (G4)

Organization Name Original Trade Consulting Role in the Project Update of the Amazon Rio REDD+ IFM Project Description (PD) (V2.0) and coordination of certification process. Contact Person João Batista Tezza Neto Title Director Address Avenida André Araújo, 2936 – Edifício Incubadora do INPA, sala 10, Cep. 69.060-000, Manaus-AM, Brazil. Telephone +55 92 981590997 Email [email protected]

6 COVEMA assists all communities around the reserves, as well as 40 other communities in the municipality, within and outside of Conservation Units and Settlement Projects. There are more than 500 registered Brazil nut harvesters, the second largest job generating institution in the city of Manicoré, just behind the City government. Such performance grants it a preeminant position in the state of Amazonas. In 2011, COVEMA expanded its operations to the neighboring municipality of Novo Aripuanã, to purchase the production of the Madeira and Juma RDSs.

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Organization Name HDOM

Role in the Project Degradation and deforestation report; Forest inventory for biomass calculation purposes in the project area and support the PD review

Contact Person Francisco Higushi

Title Director

Address Av. Mário Ypiranga, 315. Ed. The Office, sala 609. Adrianópolis. CEP 69.057-002

Telephone + 55 92 98128 2561

Email [email protected]

1.7 Project Start Date

The project began on August 17, 2012, when the board and EBCF shareholders formally approved the company's Business Plan (Annex 27), which set out the objectives of conserving forests through the REDD + , provision of services and sustainable use of forest resources excluded logging activities.

1.8 Project Crediting Period

The first crediting period of the project is 37 years, beginning on August 17, 2012 and ending on 17 August 2049. This period is equivalent to the remaining 12 years of the first authorized management plan (25 years from 1998) added to another 25 years in respect of a new forest management plan that was intended, as the common practice of forestry in Brazil. The logging activities could continue beyond 37 years, aiming for a second crediting period.

2 DESIGN

2.1 Sectoral Scope and Project Type

 Project Scope: Agriculture, Forest and other Land Use (AFOLU)  Project Category: Reduction Emission from Deforestation and Degradation from Planned Deforestation (REDD-IFM)  Type of Activity: Improved Forest Management - Logged to Protected Forest (IFM LfPF)

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2.2 Description of the Project Activity

The Amazon Rio project expects greenhouse gas emissions reductions from the Amazon Rio I, II, III and IV areas by promoting forest conservation activities instead of the logging, licensed in August 1998 and beginning in 1999. Forest conservation activities are important to the project region, an ecologically significant landscape that is well preserved, and has high biological diversity, outstanding endemism, as well as economic and pharmacological potential. These characteristics created the opportunity to plan activities related to ecological, educational and scientific tourism initiatives, as well as technical and scientific research related to natural resource management. However, as they are part of a strategy aimed at strengthening income generation for communities, revenues of these initiatives are more difficult to quantify and therefore were not considered in the economic analysis. Nor were they taken into account in the decision to create the private reserves and to cease timber management activities.

The only source of income considered by the proponent of the project comes from payments for environmental services (PES), from the sale of Environmental Reserve Quotas (CRAs) and carbon credits. With regard to legal reserve compensation, it has been recognized in the new Forest Code (Law no. 12.651/ 2012)7 as an opportunity to take advantage of the surplus of forest cover of a rural property to compensate for the absence of legal reserve in another property, provided that they belong to the same biome. These offset areas are considered to be securities representing vegetation cover that can be used to fulfill the obligation of the legal reserve on another property. This mechanism offers the possibility to add market value to the forest areas of a property, which exceed the legal requirements (RL and APP). The Forest Code sets forth that CRAs can be created in the areas of:

 Forest easement;  Legal reserve voluntarily instituted on the vegetation that exceeds the statutory percentage;  Conservation unit in the public domain which has not yet been expropriated;  Private Reserve of Natural Heritage (Reserva Particular do Patrimônio Natural - RPPN) - which holds a legal status similar to the RPDS, though more restrictive, since it fits a category of conservation units of permanent protection, while the RPDS belongs to the category of protected areas of sustainable use.

The income from carbon credits result from the reduction in emissions from deforestation, as well as the sale of CRAs that will create the financial conditions with which to implement the activities in the Management Plan of the Amazon Rio I Private Reserve and the future Amazon Rio II, III and IV Reserves. Although they are private areas, which do not host traditional communities within its

7 http://www.planalto.gov.br/ccivil_03/_ato2011-2014/2012/lei/L12651compilado.htm

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boundaries, a deliberate decision was made to include them as active participants in the planning and implementation of programs and projects included in the Management Plan. Actions of this Plan support sustainable business practices and seek to significantly improve the quality of life of these populations.

To efficiently and successfully implement the Plan, preliminary activities such as inventories, research, diagnostics and training courses must be carried out. Concurrently, projects that provide rapid returns should be implemented, such as school renovations and construction of wells, construction of warehouses, Brazil nut warehouses (paióis), acquiring ambulance boats8, among others, in order to motivate and engage communities. In the medium and long term, efforts and investments should be focused on innovative projects that generate income, such as tourism, agroforestry systems, consolidation of productive chains of non-timber forest products, among others, and the implementation of all infrastructure and equipment acquisition necessary for its proper operation.

In addition, programs will be deployed to monitor the use of the plants, animals and various natural resources systems by surrounding communities, similar to the Program for Monitoring Biodiversity and Use of Natural Resources in Conserveation Units (ProBUC), and the Voluntary Environmental Agent (AAV) both developed by the Secretary of Environment and Sustainable Development of the Amazon (Secretaria de Meio Ambiente e Desenvolvimento Sustentável do Estado do Amazonas - SDS)

ProBUC is a participatory program in which the involvement of community extends beyond the training for biodiversity and natural resources use data collection. In this program, local people are involved and encouraged to participate in all stages, from planning to results evaluation. The program allows local people to see the importance and responsibility of their actions for the maintenance of ecosystem integrity and thereby ensure their livelihoods in a sustainable manner (MARINELLI et al., 2007).

By focusing on threats, monitoring seeks to understand the status of biodiversity and use of community resources of UC to plan measures to mitigate and prevent the overharvest of wildlife and local plants. The deployment of ProBUC ensures better planning and management of hunting and fishing activities by communities, thus avoiding overharvest of animals such as tapirs, deer, monkeys, birds and wild boar. Within its scope are the following elements: i) awareness, ii) training and iii) environmental monitoring.

8 Ambulance boats are vessels equipped to act as mobile ICUs. They are widely used in the Amazonas State, that uses waterways as the main type of transport between municipalities.

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The objective of the Voluntary Environmental Agent Program (Programa Agente Ambiental Voluntário - AAV) will be to train and support the formation of the surrounding residents of Amazon Rio Reserves in community mobilization actions seeking solutions to environmental problems. Environmental education, conflict mediation and joint efforts for surveillance in the Reserves and its surroundings will be developed, in particular in the areas of collective use by households. It is important to emphasize that these actions should not set control actions, but to support environmental protection and surveillance activities. Therefore, this program will give local people the opportunity to assist their communities in environmental education, protection, preservation and conservation of natural resources. After the implementation of these two programs in the Amazon Rio areas and its surroundings, the creation of fishing agreements will be encouraged in Matupiri, St. John and Jatuarana lakes to control the commercial and exploratory fishing by boats from other regions, including the headquarters in the city of Manicoré. It is also intended to support the organization of the traditional system of fishing of communities to prevent overfishing of locally important food and commercial species, such as pirarucu, tambaqui, tucunaré and others, thus ensuring the balance and maintenance of fish stocks for food and sale.

To evaluate the success and progress of these initiatives throughout the development of the project, we used the methodology of the Sustainability Matrix developed by the Amazonas State Secretary of Environment and Sustainable Development (Secretaria de Meio Ambiente e Desenvolvimento Sustentável do Estado do Amazonas - SDS). This tool was applied in 15 communities, taking into account the local socio-economic aspects that motivated the development of 20 parameters considered of major importance for community development, described by specific indicators. The Sustainability Matrix is a visual tool well suited to traditional communities, such as the coastal and indigenous communities surrounding the Amazon Rio I and other areas of the project. In addition, the Matrix provides interesting opportunities for discussion owing to the participatory nature of its construction.

Using the Sustainability Matrix built from community collaboration, projects, activities and implementation strategies could be identified. Meanwhile project budgets, verification and evaluation methods will be detailed later in Annual Operational Plans and monitored in due course. In total four programs and nine sub-management and community development programs (Annex 9) were defined.

Table 1: Implementation schedule and next activities.

Ano Atividade

2010 EBCF performs the symbolic protocol creation of the first RPDs during the

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seminar results and perspective of the State of Amazonas Conservation Units held by the SDS.

2011 EBCF submits the formal protocol to CEUC.

Meeting presentation EBCF for communities near the Amazon River I, II, III 2011 and IV.

EBCF attended the informal invitation made by the management of RDS Rio Amapá and representative CEUC - Silvia Elena, the training workshop 2011 and delivery portfolios ENVIRONMENTAL VOLUNTEERS AGENTS held in the Boa Esperança community.

EBCF participated in the event organized by the CAAD which had the agenda: General Assembly, accountability of CAAD year 2009/2010, RDS Management Plan Amapá Rio, Bolsa Floresta, Municipal Management, 2011 IDAM contribution, contribution Covema, IEB's contribution and delivery of equipment for processing of acai, held on 24/03/2011 in the community of Democracy and 25/03/2011 in the Boa Esperança Community.

2011 Inspection of CEUC on farms for approval on RPDs.

2011 The board of EBCF makes his 1st visit the communities and farms.

EBCF in partnership with the Municipal Government of Manipur, perform the recovery local road (approximately 20KM) linking Democracia 2011 community, Jatuarana communities, Terra Preta Community, Santa Eva and Vista Alegre.

Visit of the president and directors of EBCF the communities surrounding the reserves, together with the president of PATAC Marcelo Marder and 2012 Andre Albuquerque president for socioeconomic communities report presentation.

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Business Plan Project approval and EBCF shareholders agreement, 2012 authorizing the start of the REDD project.

Workshop I - Diagnosis for the development of areas of the Amazon River 2013 Management Plan I, II, III & IV.

Visit communities to complement the workshop I for interviews with the 2013 locals.

Meeting in CEUC after the second workshop to update the work with the 2013 communities and the progress of the approval of the areas.

Technical meeting with the team CO2X, Renascer and Human Development EBCF in Curitiba for the review and evaluation of the first part of the Management Plan (diagnosis); Definition of programs and 2013 subprograms of the Plan; identification of key issues, potential threats and opportunities with the creation of RPDSs; definition of vision and action strategy.

The Secretary of State for the Environment (SDS) officiated at the World 2013 Environment Day, the first Private Reserve Sustainable Development (RPDs) of the Amazon with the signing of the decree no. 86.

Workshop II - presentation of the carbon project as one of the fundraising 2013 programs for the implementation of the Management Plan.

Field work with communities and farms for mapping biodiversity and 2013 hunting and fishing grounds.

The EBCF performs a complete socioeconomic census in the surrounding 2013 communities of RPDs.

2013 Meeting with CEUC for delivery and presentation of the draft of RPDs

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Amazon River Management Plan I.

Supplementary Meeting to communities who could not attend the 2013 Workshop II & III Workshop Creation of the Advisory Council for RPDs Amazon River I.

2013 The EBCF performs social and economic Census in Kamayuá community.

2015 Realization of field activities for "Biomass Inventory Estimation".

2016 Vitor Belfort visit and launch of income-generating initiatives.

Distribution of medical kits for community health workers and launching the 2016 Health Program in the Amazon.

2016 Deforestation Report.

2016 PD Review and preparation of the monitoring report.

2016 REDD + Project Certification (VCS and CCV).

Project planning for structuring the supply chain of vegetable oils 2016 certificates.

2017 Fundraising from the REDD project.

2017 Ecotourism Project Design.

Workshop Achievement "Participatory Planning Project REDD + activity 2017 EBCF".

2017 ProBUC Deployment.

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2018 Implementation of Voluntary Environmental Agent program.

2.3 Management of Risks to Project Benefits

Authorized timber extraction

The authorized extraction of timber should not be considered a risk to the project, since the initiative intends to transform the areas into conservation units. Thus, terminating the logging activities was the initiative of the applicant itself, who is the legal owner of the areas.

In 1998, a 25-year logging plan was approved for the four areas of the project on a total licensed area of 19,800 ha. Between 1999 and 2010, about 4,347.69 ha were logged (and partially degraded). This same area (19,800 ha) was then donated to the Empresa Brasileira de Conservação de Florestas (EBCF) in 2011 for conservation purposes, by then owner Valdenor Campos da Costa, a founding partner of EBCF. The purpose of this donation was to preserve the forests of the region, transforming the four areas into a mosaic of conservation units. In this way, the GHG emissions associated with logging activities (baseline scenario) would not longer be generated and since timber management does not figure among the activities envisaged by the Reserve’s Management Plan, such emissions are not expected to re-occur in these areas.

Illegal logging

Illegal logging is perhaps one of the greatest risks to the permanence of carbon stocks of any conservation project in the Amazon, including the Amazon Rio project. Because it is often associated with indiscriminate hunting, illegal logging also presents serious risks to biodiversity especially for maintenance and balance of plant species.

Illegally extracted Amazonian wood is today one of the main sources of raw materials supplying the domestic wood market. According to data from SFB/IMAZON (2010), 35% of wood produced from the Amazon region is logged illegally. However, it is important to note that even legally produced wood has faced supervisory and control difficulties regarding its forest source documents (DOF). Thus, once should expect that the sale of “legal wood” through falsified DOFs may actually underestimate the true volume of illegally logged timber. Data from ADEOTADO et al. (2011) shows that 33% of Amazon wood consumed in the state of São Paulo – the largest consumer in the internal market – is sourced illegally.

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Figure 4: Illegal Wood in the Amazon (2009). SFB/IMAZON (2010)

In the case of the project areas, the prospect is that over the medium and long term, carbon certificates (Verified Carbon Units - VCU’s) and CRAs generated by project activities will subsidize investments in the surveillance of project areas and the development of sustainable income- generating programs, as envisioned in the Management Plan.

In this context, the RPDS Management Plan predicates the involvement of communities, public environmental protection agents, and environmental volunteers to the formation of an active board to protect and supervise the Reserves. The fact that the project area is located adjacent the Rio Amapá RDS which is in a public domain, contributes to the protection and surveillance activities on the private reserves. Besides this factor, the plans are to construct floating docks from which to monitor boat traffic in the vicinity of the Reserves, thus helping to combat illegal logging.

Forest fires

Forest fires also represent a frequent risk to agriculture, forestry and other land use projects (AFOLU), and represent a major threat to the surrounding communities and to their livelihoods. Besides natural and criminal causes, fires can also be caused by the traditional activities of opening and clearing new areas for agriculture and renewing pastures. Such practices should therefore be subject to the control and adoption of management systems.

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The fact that the project area is neighboring the Rio Amapá Sustainable Development Reserve (RDS), a synergy is expected between the two conservation units in terms of monitoring illegal activities in the region, especially illegal logging and forest fires. Additionally, the Management Plan foresees training of local people in agricultural techniques that do not require the use of fire for opening and clearing (slash and burn) the cultivation areas, as well as the installation of an efficient system for preventing and fighting forest fires, which should rely on trained teams, installation of observation towers and environmental education programs.

Impacts to surrounding communities

Any project that relies on external support, no matter how well-intentioned and planned, interferes with local systems of use and ownership of natural resources, especially for traditional populations. This is probably the biggest risk associated with the implementation of project activities which should be carefully considered and enlist the support of sustainable rural development experts, social scientists, and anthropologists.

So that the project contributes to a more equitable division of resources and its benefits external agents that recognize local systems of use and ownership of resources are vital, so that internal conflicts do not escalate, but rather establish actions that favor the collective interests of the groups involved. Poorly prepared and executed projects may introduce new conflicts or aggravate existing ones. Conversely, projects that rely on community participation in its early stages of development and consider the conflicts and their systems of land division and resource usage can help reduce and prevent disputes.

As estimated in the Management Plan to improve the traditional systems of production and management, from the increase in productivity, employment of conservation measures, including new species and varieties, expansion of the range of forest species and greater spatio-temporal planning of project activities, adaptations and adjustments in these traditional systems should occur. Such measures, even if done cautiously, will affect the local institutional arrangements involved in production and management systems, and could potentially change the way they fuction. These changes should be strictly monitored so there are no negative impacts on livelihoods of local populations.

Predatory exploitation of plant and animal resources

An imminent risk to biodiversity is the predatory exploitation of natural resources, especially fish stocks, hunting and timber and non-timber forest resources. This risk will be mitigated through the implementation of biodiversity monitoring programs and the use of natural resources in the Amazon State conservation units (ProBUC), and Voluntary Environmental Agent program (AAV), in

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addition to the hunting and fishing agreements to be implemented at the main entry points these for these resources in the project area.

Such initiatives will assist in the monitoring of the most commonly used natural resources, in evaluating their availability, and enable the proposition of best practices and management systems that respect minimum viable populations, reproductive periods of animals and fish, as well as the ability to support timber and non-timber forest resources.

2.4 Measures to Maintain High Conservation Values (HCV)

The concept of HCV was originally introduced as a forest management certification by the FSC, with the objective to define forest areas of extraordinary importance, mostly for primary and intact forests.

However, due to the significant direct and indirect impacts caused by human activities on natural environments, it is virtually impossible to find a forest that has not undergone any anthropogenic change in its form and so the concept must be adjusted. Currently, the approach of HCV refers to six key attributes related to forest area, involving biological, ecological, social value and cultural materials of extraordinary significance or critical importance in national, regional or global scale, which are explained below.

At the time of the preparation of this document, specific surveys to identify the HCVs within the limits of the project have not been done conducted. However, it is expected that with the gradual implementation of the Management Plan, such studies will be carried out in order to map any HCVs in the project area, adding value to the forests of the RPDS.

Description of high conservation value (HCV) present in the project area and its surroundings

I. Protected areas

The objective of the project areas is to contribute effectively to the maintenance of the forests of the South-Central State of Amazonas. They are therefore established as priority areas to be protected for nature conservation, through the creation of Private Sustainable Development Reserve (RPDSs), provided for by the State System of Protected Areas of the Amazon (SEUC).

The project areas are strategic for environmental conservation, for harboring approximately 20,000 hectares of well-preserved forests, and for ensuring connectivity between large blocks of protected forests under the Federal Government jurisdiction (Lago Caparanã Grande RDS) and under the State of Amazonas’ jurisdiction (Rio Amapá RDS, Rio, Matupiri State Park RDS and Juma RDS).

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For this reason, the reserves have high conservation value over an ecologically varied landscape, facilitating gene flow between animals and plants through these protected forest tracts, especially in light of possible future scenarios of intensive land occupation and conversion of forests into agriculture and livestock production.

The location of the Amazon Rio II and Amazon Rio III areas is also of importance within a macro- region of the municipality of Manicoré, on the right bank of the Madeira River, which considered to be of extremely high biological significance by the Ministry of the Environment and a priority area for conservation in Brazil (MMA, 2007). See map below.

Figure 5: Areas of importance for biodiversity conservation in the Amazon (According to the Ministry of the Environment (2007) review it is possible to see that the areas of the Amazon Rio II and III are part of the "extremely high" classification for biodiversity conservation

The areas identified were classified according to degree of importance for biodiversity and the urgency in implementing the suggested actions. For this purpose, the following typology was adopted: extremely high, very high, high, and insufficiently known.

The methodology used by the MMA to define priority areas for conservation, sustainable use and benefits sharing from the biodiversity found in Brazil considers:

 Biodiversity targets: endemic species, endangered or species of limited distribution, biologically exceptional or rare phenomena;

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 Targets for sustainable use: species of economic or medicinal importance; areas/species important to traditional populations and for the maintenance of their traditional knowledge; flag- ship species that motivate conservation and sustainable use activities; key species on which the sustainable use of biodiversity components depends; important areas for conservation- based development; areas that provide environmental services to agricultural areas (such as those dependent on pollination and biological control); important areas for the cultural and social diversity associated with biodiversity;  Target persistence and processes: important areas for the maintenance of environmental services (maintenance, biogeochemical cycles, climate hydrological processes, groundwater recharge areas); centers of endemism; evolutionary processes; important areas for species and migratory pollinating species; climate havens; areas import for connectivity and gene flow; protective areas for watersheds; important areas for maintenance of the flood pulse in floodplains; extensive areas for species with large habitat requirements. After the priority areas for biodiversity conservation in Brazil were identified, the MMA (2007) recommends the following action strategies to improve territorial management and the sustainable use of natural resources:

 Establishment of conservation units, expansion of existing conservation units, establishing fishing exclusion zones, encourage the establishment of mosaics of protected areas, surveillance and control;  Implementation and consolidation of protected areas, watershed and water resources management, establishment of ecological corridors, sustainable management of natural resources, management of invasive species or pests, resolving management conflicts in protected areas, supervision and control;  Biological inventorying, biodiversity monitoring, analysis of specific population dynamics, long- term research  Approval of indigenous lands, recognition of Quilombos lands, deployment of watershed committees, ecological-economical zoning, environmental education programs, implementation of economic mechanisms to support biodiversity conservation.

The creation of sustainable use UCs was the most recommended priority action, followed by the creation of protected areas in other categories, spatial planning, formation of mosaics or ecological corridors and recovery of degraded areas.

II. Endangered species:

FLORA

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About 5% of the tree species identified in the project areas are on the Red List of endangered species, according to the International Union for Conservation of Nature (IUCN). They are either critically endangered (CE) with extremely high risk of extinction in the wild; endangered (ED) with very high risk of extinction; or vulnerable (VU) with a high risk of extinction in the wild. The following table lists the endangered species of trees in the region of the Amazon Rio project:

Table 2. Endangered plant species in the areas of the Amazon Rio project (using forest inventory information conducted by EBCF and considering the Red List of endangered species (footnote IUCN).

Common Red Common Year Kingdo name list Order Family Species name assess m (Portugues stat (Inglês) ed e) us Chrysophyl PLANTA EBENALES SAPOTACEAE lum Abiurana CE 1998 E superbum Micropholi PLANTA EBENALES SAPOTACEAE s Abiurana CE 1998 E grandiflora Aniba PLANTA LAURALES LAURACEAE rosaeodor Pau rosa ED 1998 E a PLANTA LEGUMINOSA Inga FABALES Inga ED 1998 E E suberosa PLANTA Pouteria EBENALES SAPOTACEAE Abiurana ED 1998 E fulva PLANTA Pouteria EBENALES SAPOTACEAE Abiurana ED 1997 E juruana Pouteria PLANTA EBENALES SAPOTACEAE tarumanen Abiurana ED 1998 E sis Virola PLANTA MAGNOLIAL MYRISTICACE Ucuuba, Baboonw surinamen ED 1998 E ES AE virola ood sis PLANTA LECYTHIDA LECYTHIDAC Bertholletia Brazil nut Castanheira VU 1998 E LES EAE excelsa tree Louro fofo PLANTA Aniba LAURALES LAURACEAE (Ocotea VU 1998 E ferrea aciphylla) Aniba PLANTA LAURALES LAURACEAE santalodor Louro rosa VU 1998 E a

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PLANTA LECYTHIDA LECYTHIDAC Cariniana Couroupita VU 1998 E LES EAE integrifolia guianensis Cariniana PLANTA LECYTHIDA LECYTHIDAC Couroupita pachyanth VU 1998 E LES EAE guianensis a PLANTA LECYTHIDA LECYTHIDAC Cariniana Couroupita VU 1998 E LES EAE uaupensis guianensis Eschweiler PLANTA LECYTHIDA LECYTHIDAC a Ripeiro VU 1998 E LES EAE rhododend branco rifolia Abiu, abiurana, PLANTA Pouteria abiurana- EBENALES SAPOTACEAE VU 1998 E lucens abiu, jaraí, abiurana bacurl

* CE: at extremely high risk of extinction, ED: very high risk of extinction, VU: Vulnerable

These species have become endangered for their productive and cultural importance of local communities. In general, all plant parts are used either in construction (timber species) or in the essence, resin, bark, fruit and tannin industries (multiple use species).

FAUNA

According to MMA (2008) 627 animal taxa are considered endangered in Brazil, including 61 Amazon species, using the IUCN methodologies that created the classifications of vulnerable (VU), endangered (EN) and critically endangered (CE). Of all 627 endangered taxa, 69 are mammals (11% of the total); 160 (25.5%) are birds; 20 (3.2%) are reptiles; 16 (2.5%) are amphibians; 154 (24.6%) are fish, and 208 (33.2%) are invertebrates.

Within these endangered animals, mammals, especially primates and carnivores, are proportionally more endangered. Forests are the exclusive habitat of primates and therefore they exhibit very low tolerance to forest destruction. Carnivores, which are predominantly predators have low population densities and large habitat requirements. Both also suffer from hunting pressure: primates are hunted by humans as a food source while carnivores are hunted for the losses they supposedly cause to ranchers and other livestock breeders (MMA, 2008).

The following table presents the endangered animals in the Amazon Rio project areas and their surroundings, using the biological inventories of RDS of Rio Amapá and the endangered species database available from IUCN9 and ICMBio10 as references.

9 http://www.iucnredlist.org/

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Table 3.Endangered animal species in the Amazon Rio project and surrounding areas.

Common Red Year Kingdo Common name Order Family Species name list asses m (Inglês) (Port.) status sed Pteronura Giant Otter, ANIMAL CARNIVO MUSTELIDA brasiliensi Ariranha Giant Brazilian ED 2008 IA RA E s Otter Puma, Montain Least ANIMAL CARNIVO Puma lion, Cougar, FELIDAE Onça parda Conce 2008 IA RA concolor Red Tiger, Deer rn Tiger Amazonian Barred Dendroco ANIMAL PASSERIF DENDROC Arapaçu-da- Woodcreeper, laptes EN 2008 IA ORMES OLAPTIDAE taoca Amazonian certhia Barred- Woodcreeper Dendroci ANIMAL PASSERIF DENDROC Arapaçu-da- White-chinned ncla EN 2012 IA ORMES OLAPTIDAE taoca Woodcreeper merula Lowland Tapir, ANIMAL PERISSO Tapirus South American TAPIRIDAE Anta VU 2008 IA DACTYLA terrestris Tapir, Brazilian Tapir Myrmeco ANIMAL MYRMECO Tamanduá- PILOSA phaga Giant Anteater VU 2007 IA PHAGIDAE bandeira tridactyla Long-haired ANIMAL Ateles Macaco Spider Monkey, PRIMATES ATELIDAE ED 2008 IA belzebuth aranha White-bellied Spider Monkey White Saki, Parauacu, ANIMAL PITHECIIDA Pithecia Buffy Saki, Buffy PRIMATES macaco- VU 2008 IA E albicans Saki, White velho Sakia Woolly Monkey, ANIMAL Lagothrix Macaco PRIMATES ATELIDAE Geoffroy's ED 2008 IA cana barrigudo Woolly Monkey Juruá Red Least ANIMAL Alouatta Howler Monkey, PRIMATES ATELIDAE Guariba Conce 2008 IA juara Juruá Red rn Howling Monkey ANIMAL PRIMATES ATELIDAE Alouatta Guariba Guianan Red Least 2008

10 http://www.icmbio.gov.br/portal/biodiversidade/fauna-brasileira/lista-de-especies.html

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IA macconn Howler Monkey, Conce elli Trinidad Howling rn Monkey Golden ANIMAL PSITTACIF PSITTACID Guaruba Ararajuba or Parakeet, VU 2013 IA ORMES AE guarouba guaruba Golden Conure

As it can be seen in the table, 12 endangered animals threatened with extinction were identified in the Amazon Rio project area and its surroundings, of which 9 are mammals and 3 are birds. The carnivores and primates are most noteworthy among the threatened species. Among the carnivores, the presence of the giant otter is particularly important as an indicator of continental aquatic ecosystem quality. Since it is a carnivore that feeds on large quantities of fish, small mammals, birds, reptiles and invertebrates (ROSAS et al., 2008) and it is easily impacted by local ecological disturbances. In addition, it is a species which is easily captured by hunters who can recognize the loud vocalizations over long distances.

Another animal of note is the tapir, a mammal species that suffers severe population pressures and, consequently, is at risk of extinction. It is a herbivore and its meat is particularly appealing to and therefore much sought after by locals. The Golden conure (Guaruba guarouba) bird has always been a species much coveted by illegal bird traders, who have contributed significantly to the reduction in their populations in Brazil and in the Amazon, including the project area.

III. Endemic and/or rare species

Endemic species have not yet been identified in the Amazon Rio project area, however, according to the World Wildlife Fund (WWF), in the South-West Amazon (Amazonas, Acre and Rondônia states) 42 endemic species have been found, as shown in the following table.

Table 4. Species endemic to the Southwest Amazon

Scientific name Common name Class Eleutherodactylus 1 Amphibia skydmainos 2 Leptodactylus didymus Amphibia 3 Hyla walfordi Hyla walfordi Amphibia 4 Osteocephalus pearsoni Pearson's Slender-legged Treefrog Amphibia 5 Bufo castaneoticus Para Toad Amphibia 6 Hyla allenorum Cuzco Reserve Treefrog Amphibia 7 Epipedobates simulans Amphibia 8 Caecilia marcusi Villa Tunari Caecilian Amphibia 9 Scinax pedromedinai Henle's Snouted Treefrog Amphibia

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10 Dendrobates biolat Biolat Poison Frog Amphibia Eleutherodactylus 11 Amphibia buccinator 12 Epipedobates macero Manu Poison Frog Amphibia 13 Altigius alios Amphibia 14 Scinax parkeri Amphibia 15 Scinax icterica Amphibia 16 Thryothorus griseus Gray Wren Aves 17 Eubucco tucinkae Scarlet-hooded Barbet Aves 18 Cacicus koepckeae Selva Cacique Aves 19 Conioptilon mcilhennyi Black-faced Cotinga Aves 20 Formicarius rufifrons Rufous-fronted Antthrush Aves 21 Simoxenops striatus Bolivian Recurvebill Aves 22 Todirostrum pulchellum Black-backed Tody-Flycatcher Aves 23 Nannopsittaca dachilleae Amazonian Parrotlet Aves 24 Grallaria eludens Elusive Antpitta Aves 25 Picumnus subtilis Fine-barred Piculet Aves 26 Lophotriccus eulophotes Long-crested Pygmy-Tyrant Aves 27 Percnostola lophotes White-lined Antbird Aves 28 Myrmeciza goeldii Goeldi's Antbird Aves 29 Micronycteris matses Matses' big-eared bat Mammalia 30 Scolomys ucayalensis Ucayali Spiny Mouse Mammalia 31 Neusticomys peruviensis Peruvian Fish-eating Rat Mammalia 32 Apostolepis tenuis Ruthven's Burrowing Snake Reptilia 33 Helicops yacu Keelback Reptilia 34 Apostolepis nigroterminata Peru Burrowing Snake Reptilia 35 Stenocercus scapularis Reptilia 36 Neusticurus ocellatus Reptilia 37 Neusticurus juruazensis Reptilia 38 Atractus nigricaudus Black-headed Ground Snake Reptilia 39 Bothrops sanctaecrucis Bolivian Lancehead Reptilia 40 Anolis dissimilis Odd Anole Reptilia 41 Anolis scapularis Reptilia 42 Mabuya nigropalmata Black Mabuya Reptilia

IV. Areas that contain significant concentrations of species during any period of their life cycle (e.g. migration, feeding grounds and nesting areas)

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According to the information from the RDS Rio Amapá Management Plan (GOVERNO DO ESTADO DO AMAZONAS, 2010) the lakes and streams in the areas surrounding the Amazon Rio project are rich in fish biodiversity. That was demonstrated by obtaining 1,675 specimens distributed across 85 different species belonging to six orders and 19 families, carried out in 25 sampling points.

The acidic blackwater lakes are important shelters for the reproduction and development of the local fish species during the summer. In winter (October to March) the rising waters establish links between the lakes and the local igarapés (streams), bringing a great diversity of fish which breed and grow on the banks can disperse and populate bodies of running water.

The lakes and streams located within and around the Amazon Rio project areas present excellent state of conservation and fishing activities seem controlled, being held only for livelihood of residents of the region.

V. Rare or endangered ecosystems

Tropical forests are ecosystems considered rare and threatened globally, but the Brazilian Amazon forests and tropical forests of Asia suffer the greatest pressure from deforestation due to logging and subsequent conversion into agricultural landscapes.

The Amazon Rio project areas located in the vicinity of the municipality of Manicoré, the municipality with the third highest rates of deforestation in the state of Amazonas (INPE/PRODES, 2012), with approximate clear-cutting rates of 61 Km2 of the forest per year.

This deforestation pressure in the municipality is due to the movement of livestock, especially beef cattle, into the territory from the states of Rondônia, Acre and Mato Grosso. To stop these deforestation fronts, it is essential to consolidate the conservation unit mosaic, whether in the public and private domain, in the South Central region of the State of Amazonas.

VI. Ecosystem critical services

The Amazon Rio project promotes the conservation of large areas of primary forest with climatic

benefits such as the carbon dioxide (CO2) sequestration. The project will also provide a range of other critically important ecosystem services, including:

 Soil erosion control by maintaining the forest integrity, including the banks of bodies of water;  Cycling, filtering and storing water;  Oxygen production;  Nutrient recycling and improvement of soil characteristics;  Management of important environmental services such as pollination and seed dispersion;  Gene bank for medicinal plants; v3.0 47 MONITORING & IMPLEMENTATION REPORT VCS Version 3, CCB Standards Third Edition

 Food for the 15 surrounding communities, through the continuous provision of fishing, hunting and extractivism resources from the forests. The most important food items obtained from the forest are:  Forest extractivism: Brazil nuts, acai, pataua, tucuman, bacaba, pupunha, and bee honey.  Hunting: paca, agouti, armadillo, deer, monkeys (spider, howler, capuchin), tapir and wild boar. The locals traditionally hunt alligators and turtles on the banks of rivers and lakes;  Habitat for an extraordinary diversity of plants and animals;

VII. Hydrological services

The rivers, streams and lakes inside and around the Amazon Rio project areas are essential for the basic needs of 15 local communities, as well as the traditional and cultural identity. The communities also depend on the Madeira and Manicoré rivers for drinking water, cooking, personal hygiene, and as the primary means of transportation.

The Madeira and Manicoré rivers are the two main sources for the communities who harvest fish around the project areas and from the municipality of Manicoré. The most abundant fish species are: Surubim, Pacu, Piau, Jaraqui, Branquinha, Sardinha, Pirapitinga, Caparaí, Jatuarana, Matrinxã, Curimatá, Traíra, Dourada, Mandii, Dourada, tucunaré, Pirarucu, Tambaqui, Aruanã, , Aracu, and Jeju.

VIII. Fuel and fodder

The communities depend on forest products to obtain fuel and animal feed. They use mainly dry wood as fuel for cooking.

IX. Medicine

Given the difficulty of the local community in accessing pharmacies and hospitals in the urban center of Manicoré, many families use a wide variety of medicinal plants found in the forest and around the Amazon Rio project areas, some of the most widely used are:

 Copaiba oil: used as anti-inflammatory treatment;  Andiroba oil: used as a mosquito repellent and as treatment for gastrointestinal problems;  Jatobá: used to combat anemia, increasing red blood cells;  Cedar bark: used as a tooth pain reliever and antipyretic.

X. Building materials

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Amazonian communities use a variety of forest materials to build and conserve their homes, such as wood and straw, thus reducing the need to purchase supplies in urban centers. In addition, wood is a staple used in constructing houses, schools, community centers, canoes for fishing, and fences for livestock.

XI. Traditional cultural significance

Natural environments and resources used by the local communities of the project areas have great cultural significance to these populations. Many parts of the forests, lakes and rivers, in addition to providing high-value resources which are described in more detail in Section 6.1, are havens for beings with supernatural powers according to local folklore. This is the case of the “curupira”, a mystical being known as the "mother of the forest", which protects the animals from "bad hunters" (those who hunt excessively), disorienting them in such way that they become lost for hours or even days in the forest and are unable to return home. Another prevailing belief is that some people who exhibit bad social behaviors or other unknown reasons, become "panemas", i.e. are unlucky in their hunting and fishing excursions.

2.5 Project Financing

The carbon project integrates a broad vision of territorial management as part of the Management Plan of the Amazon Rio Private Reservation I. Accordingly, it stipulates that all actions necessary to implement this Plan should be enabled from resources obtained by payments for environmental services, such as carbon credits and CRAs.

The idea is for the plan to serve as a management tool to provide technical and political support support to negotiations with support institutions to receive investments that can make projects and programs viable. The expected revenues in the short and medium term to implement the Management Plan will mostly come from payments for environmental services such as negotiated carbon credits and CRAs, in addition to projects that generate long-term income exclusively for the communities, such as: ecotourism, scientific research and harvest of non-timber forest products.

In this context, the main difference between a permanent protection private reserve (e.g. RPPN) and a private sustainable development reserve (e.g RPDS) is that the long-term financial viability of sustainable reserves usage comes from the marketing of non-timber forest products with high added value and other sustainable businesses in compensation for environmental services. This flow of resources is expected to occur during and after the implementation period. The proposal is that with external support and through their political representatives, local communities will be able to establish partnerships and contracts with companies, cooperatives and industries interested in supporting social and environmental initiatives in the project areas.

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The external support initially offered in the previous paragraph, consists basically of the voluntary contribution of the project partners, which in turn believe in the proposition and the potential of the project to provide a return on the investment, both monetary and especially in less tangible dividends, such as corporate marketing and institutional visibility. At the time of the preparation of this document an initial contribution of R$ 3,963,000 was made to the project for the first 3 years, which will be used to defray initial expenses with the preparation of technical documents, management and implementation of the first activities.

As for the revenues obtained from the market for greenhouse gase emissions reductions, a projection using two prices for carbon credits was considered, considering ‘future’ (USD 4/VCU) and issued credits (USD 7/VCU).

These items are briefly listed below with their respective values regarding the implementation and execution of the project, part of which will be initially financed by the contribution of the partners, as mentioned above.

Table 5.Project implementation and operational costs11

Component Value (R$) Share (%) Pre-Operating expenses R$ 1,561,904.00 3.61% Administrative expenses R$ 24,069,915.00 55.68% Costs of VCS + CCB certification R$ 456,670.00 1.06% Monitoring R$ 2,820,000.00 6.52% Social program related expenses R$ 6,050,000.00 13.99% Carbon trading R$ 1,188,536.60 2.75% Taxes on income R$ 1,680,219.65 3.89% Taxes on profit R$ 5,008,435.56 11.59% Interest 10% return on investment of shareholders R$ 396,300.00 0.92% TOTAL R$ 43,231,980.80 100.00%

2.6 Employment Opportunities and Worker Safety

Despite the considerable local knowledge of the region’s ecosystems and environments, technology is lacking, related to the value added to products and environmental conservation projects. Besides these difficulties, public service agents frequently indicate the use of techniques and management practices that require high external inputs and major investments.

11 Annex 16

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To overcome these limitations the project intends to promote specific and culturally relevant trainings that include workshops, meetings, courses and extended technical assistance to improve the knowledge and skills of community leaders, residents and employees of the project. To complement such trainings, we intend to install diversified agroforestry systems, to restore and reuse degraded areas, to encourage handicrafts and tourism, and to improving the management of non-timber forest products, with emphasis on Brazil nuts, andiroba, copaiba and Acai. As a result management practices are expected to improve in the long-term, as well as and the fostering of local culture, combining technical and scientific knowledge with traditional knowledge.

In addition to the technical knowledge geared toward production and operations, the project will promote organizational and administrative training in participatory and democratic management based on the Management Plan, including training in accounting, conflict management, techniques and procedures for obtaining consensus and greater participation in decisions.

Additional effort will be made to empower minorities such as women and young people to have equal opportunity in training events, programs and projects to be developed, including activities related to environmental monitoring, such as the Volunteer Environmental Agents Program, ProBUC and other programs related to fishing and game hunting. It is important to mention that any and alls endeavors should meet the social requirements of labor legislation, health and worker safety.

Apart from the training courses for the groups directly involved, learning materials about the project are to be distributed in schools, associations and cooperatives to disseminate its goals, activities and results. Other materials and journalistic texts will be developed and broadcasted in local communication media, such as radio, newspapers and television, with more comprehensive and informative content.

To avoid risky situations during workers’ activities and assignments, specific training in worker safety will be offered. This training will include a series of operating procedures to minimize accidents on the job, especially in occupations that require the use of production equipment and machinery for extraction and processing. In addition, workers will receive first aid training and will be required to use personal protective equipment: boots, helmets, special clothing, tools, medicines, etc.

2.7 Stakeholders (G3)

Consultation prior to the beginning of the project

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The populations involved in the carbon project are direct users of forest resources that are present in the Amazon Rio I, II, III & IV areas for the practice of plant and animal extraction. Initially they were indicated by the Council of Agro-Extrativist Associations of Democracia (Conselho das Associações Agroextrativistas de Democracia - CAAD), which gathers associations of residents from ten communities located near the Amazon Rio I Reserve. Following this indication, the EBCF hired the services of the consulting company CO2X Conservação de Florestas Ltda to perform a series of workshops and meetings to prepare the Amazon Rio I Management Plan (Annex 9) and to develope the Amazon Rio REDD+ IFM project. In these meetings different forms and spaces of participation of the people and government and non-governmental institutions were discussed to support the development and implementation of the Management Plan, culminating in the creation of an Advisory Council.

In these events, conservation and fundraising strategies were presented to the community, among them the marketing of avoided emissions resulting from the suspension of timber management activities. The conduct of the Free, Prior and Informed Consent (FPIC) process was done in the communities surrounding the Amazon Rio I, II, III and IV areas during three workshops in 2013, which had a very inclusive and participatory nature. These documents, as well as the minutes of the workshops, participatory mapping, Sustainability Matrix, questionnaires and presentations in PPT slides are available in Annex 10.12

Identification of stakeholders

There are 15 communities that will benefiot from the activities of the project and twelve of them (Urucury, Água Azul, Vista Alegre, Boa Esperança, Santa Eva, Santa Maria, Pandegal, Democracia, Jatuarana, Terra Preta do Ramal, Kamayuá and São José do Miriti) are located in the region surrounding Amazon Rio areas I and III and in the Rio Amapá Reserve on the Madeira River and its tributaries. One of the communities is formed by residents that integrate the Agroextractivist Association São João e Ponta Grossa, which is located in the surroundings of the Amazon Rio IV area. Two communities, Terra Preta do Rio Manicoré and Mocambo, are located in the region surrounding the Amazon Rio II on the bank of the Manicoré River.

Except for Terra Preta do Rio Manicoré, Mocambo, and São José do Miriti, all of the communities utilize the Rio Amapá RDS area, either on a sporadic or seasonal basis, to meet their food needs (collecting various fruits, fishing and hunting); for household and medicinal use (bark, leaves and plant parts considered by medical practices and traditional knowledge); and primarily for the sale of various non-timber products, especially the harvesting of Brazil nut, açaí and copaíba oil. However, the trails, roads and paths that provide access to the Amapá Rio RDS and Amazon Rio areas are in a poor state of repair, which hinders extraction practices, especially the production of Brazil nuts.

12 This topic is thoroughly discussed in Section 3.7 of this document.

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In addition to the 15 communities surrounding the Amazon Rio areas, government organizations directly involved with environmental issues in the region, such as SDS, the National Indian Foundation (Fundação Nacional do Índio - FUNAI), City Hall and the City Council of Manicoré, the Secretary of Environment and Sustainable Development of Manicoré, ICMBio and non- governmental organizations, such as FAS, IEB, CAAD, CNS, UFAM, UEA were identified and contacted to participate in the entire process of preparation of the Management Plan.

Stakeholder meetings

To present and discuss the project in detail with representatives of 15 communities surrounding the project area and support institutions three workshops in different locations were conducted. The subjects were presented in straightforward language, in a culturally appropriate way so that community representatives could understand relatively complex and unusual concepts such as climate change, greenhouse effect and payments for environmental services.

The importance of forests for the mitigation and adaptation to climate change was emphasized to convey the main objectives of the project to community representatives, and in particular their role in: (i) absorbing carbon dioxide and release oxygen; (ii) helping control climate processes on a regional scale; (iii) regulating the flow of rivers and erosion control; and (iv) providing shelter and food for most animals and plants on the planet. The fact that 20% of global greenhouse gas emissions come from the destruction of forests and in Brazil 70% of emissions come from deforestation was also mentioned.

During the workshops participants learned that steps can be taken to reduce the emissions of greenhouse gases by investing in renewable energy sources such as solar energy, wind energy, hydroelectric power plants, electric cars and other more efficient ones. Another option that mitigates climate change was also highlighted that relates to the Amazon: forest conservation and the restoration of degraded areas through reforestation, management of agricultural land, and establishment of agroforestry systems.

After concepts were discussed it was explained to those present that the proposed project to be carried out in the RPDS Amazon Rio I, recently approved at the time, and in the creation process in the other Reserves has essentially one goal: to financially reward those who preserve and protect a forest threatened with deforestation and degradation. The two main objectives of the project are: (i) raise funds for the implementation of the Management Plan programs and (ii) conservation of the forest and the associated biodiversity. It was also mentioned that the project is part of a new vision of the business strategy, since a logging plan was operational until 2010, associated with the emissions of greenhouse gases. In 2010 the practice was suspended by the owner, who began investing in the creation of a project focused on conservation and payment for environmental services, with emphasis on the voluntary carbon market.

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Conflict resolution

To be adequately solved, conflicts and complaints should be reported immediately to the field coordinator of the project, which will be established in Manicoré. If the conflict involves residents of more than two communities, their representatives shall be notified to make the necessary arrangements.

If the issue raised has more complex implications and involve broader actions under the project, it will be directed to the Advisory Council. This forum will act as a democratic space for formal representation of communities and governmental and non-governmental institutions for support. The Council aims to conduct mediation between the coordination of the project and other social actors involved in the implementation of the project. It therefore serves as an instrument for monitoring, supervision and conflict resolution. If necessary the Advisory Council may create specific fora to represent social groups with less power and standing to voice their needs and interests.

All complaints and their solutions should be registered and filed in properly organized folders in the project's office location so that they are readily available for consultation. These records also serve as a way to ensure that its contents are reviewed by external consultants so they can take lessons learned from these events and develope strategies to prevent or minimize future conflicts and disputes.

3 LEGAL STATUS

3.1 Compliance with Laws, Statues, Property Rights and Other Regulatory Frameworks

Considering that the project is based on the conservation activities and sustainable use of non- timber forest products, there is no conflict between these activities and any legislation (municipal, state or federal), international laws and regulations for the implementation of the activities proposed by the project. Listed below are the relevant laws and regulations that support the activities:

 Federal law no. 12.651 of 2012 - establishes the new Forest Code  Federal law no. 12.187 of 2009 - establishes the National Climate Change Policy and the Federal Decree no. 7390 of 2010 - regulates the National Policy Climate Change  Federal Law No. 9.985 of 2000 - establishing the Private Natural Heritage Reserve  Federal law no. 6.938 of 1981 - establishing the National Environmental Policy  The country's commitment to the UNFCCC, ratified by Decree no. 1 of 02/03/1994  State law no. 53 of June 2007 - established the State System of Conservation Units (Sistema Estadual de Unidades de Conservação - SEUC) and Decree No. 30.108 of June 2010 -

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regulates private Special Reservations for Sustainable Development (Reserva Particular de Desenvolvimento Sustentável - RPDSs)  State law no. 3135 of June 2007 - establish the National Climate Change Policy, environmental conservation and sustainable development in the state of Amazonas  CONAMA Ruling - nº. 406/2009 - establishes technical parameters to be adopted in the preparation, presentation, technical evaluation and implementation of the Plan for Sustainable Forest Management (Plano de Manejo Florestal Sustentável) for the logging of native forests and their forms of succession in the Amazon  Decree 5.975/2006 - regulates forestry through forest logging plans, following Art. 19 of Law 4771/1965, as well as the implementation of Articles 15, 16, 20 and 21  Rule No. 5 11/12/2006/MMA, Ministry of Environment - this law provides for all the technical procedures for the preparation, presentation, implementation, and technical assessment of forest logging plans and sustainable forms of succession in the Amazon  Decree-Law No. 5452/1943 - approves the Consolidation of Labor Laws (CLT)

To date, no legal framework at the national or international level has established laws, legislation and policies related to REDD+ mechanism. There are, however, some ongoing processes, which were considered in this study.

The current negotiation in the UNFCCC indicates an implementation of the REDD+ mechanism with a gradual approach, in which pilot projects will also be considered. The Amazon Rio REDD+ IFM project is a pilot initiative and the first of its kind in Brazil due to the fact that it is being carried out on a private reserve for sustainable use, therefore the first private area in the country using this approach. The new model will likely assist in the construction of a national REDD+ mechanism. The total project area is made up of 12 distinct properties, which together represent four adjacent areas. Twelve public deeds were issued on behalf of the project proponent EBCF (Annex 11).

The Brazilian labor system is governed by the rules set by Decree-Law No. 5.452, of May 1, 1943, approving the Consolidation of Labor Laws (CLT). This is the main piece of legislation relating to Brazilian labor law and establishing the rules governing individual and collective labor relations.

In the specific case of the project, hiring of community residents to perform various activities and functions under the Management Plan will be a priority. Labor will be contracted from the associations of communities/CAAD and EBFC, which manages the Amazon Rio I Reserve. The contracts will be established according to the appropriate mode (CLT, temporary contract, consulting, etc.) in accordance with Brazilian law. When engaging the residents of Kamayuá Indigenous Community, FUNAI will be the intermediary. In both cases, contractors will be informed of their rights at the time of contracting.

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Appropriate authorities’ approval, including formal and/or authorities required by traditional communities

The project has been widely discussed with the Government of the State of Amazonas, through the Amazonas State Secretary of Environment and Sustainable Development (Secretaria de Meio Ambiente e Desenvolvimento Sustentável do Estado do Amazonas - SDS) under the Amazonas State Center of Protected Areas (Centro Estadual de Unidades de Conservação - CEUC) and has the support of the State Government (Annex 12). FUNAI is also accompaning the process, and has appointed a local representative from the municipality of Manicoré to participate in workshops and meetings with the Kamayuá Indigenous Community.

Formal authorization was obtained from representatives of the surrounding traditional river and indigenous communities through a consultation process. At the end of this process we obtained the approval and signature of a "Free, Prior and Informed Consent" document (Annex 10) by the representatives of 15 neighboring communities who participated in the workshops that addressed the objectives, activities and forms of participation and monitoring of the project.

3.2 Evidence of Right of Use

For nearly four decades the project area was in the possession of Valdenor Campos da Costa's Family. In 2011, the properties were transferred to the Empresa Brasileira de Conservacão de Florestas (EBCF), in which Valdenor Campos da Costa Junior became a founding partner, with the goal of transforming these areas into four Private Sustainable Development Reserves (RPDSs). The land titles and other documents are registered in the Land Registry Office of the Municipality of Manicoré, Amazonas, with the following registration numbers: 2045, 2046, 2047, 2048, 2049, 2050, 2052, 2053, book 2-6, pages 116-123 (Annex 11).

The land use rights within the limits of the project are set by the State System of Protected Areas of the Amazon (Centro Estadual de Unidades de Conservação - SEUC), in the category of conservation for sustainable use, establishing the Private Sustainable Development Reserve, and regulated by Decree 30.108 of June 2010. This category is defined as a private conservation area created by voluntary manifestation on the part of the owner with the intent to promote the conservation of natural resources and the practice of sustainable development. The right to use these areas may also be granted to the communities who use their natural resources for their production, economic and cultural means.

From the legislation point of view on carbon credits generated by the project, EBCF benefits from the exclusivity in the ownership and commercialization of reduced emission certificates, i.e. the VCUs, since the baseline activities, the property deed, the emissions reduction activities and the process of creation of the RPDS are concentrated on the legal form of the Company.

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From the point of view of land use and natural resources, although the communities surrounding the Amazon Rio areas occupy a common territory (unoccupied private areas) and share the use of existing resources there, it does not follow that all resources are communally managed. The rights to use the space and the resources are complex and varied: the land is owned by the State and/or private owners, but the resident families retain traditional rights over them. Internally, the resources are appropriated according to local rules and agreements.

There are basically three types of rights of possession and use of resources in these communities: single use, common use and open use. The single use areas are family owned areas and include gardens, fields, pastures, retreats, Brazil nut caches, rubber plantations, and secondary forests and woodlands (used in extracting straw, oils, timber for building houses, boats and canoes), and the expansion or establishment of new gardens or management units. The common areas include forest reserves, açaí and buriti planting grounds, lakes, flooded forests and streams, and are appropriate for all residents of the same community that are governed by the agreed-upon rules and procedures.

However, not all common use areas have the same level of control and restriction as other communities and external users. Generally the more distant areas are more difficult to control and, in certain circumstances, are considered open access areas, characterized by little or no control or restrictions on use and access. This is the case in some areas of use of the Amazon Rio IV, like the areas adjacent to Lake São João, whose surrounding residents cannot control fishing, logging and gathering of açaí, which is conducted in a predatory manner by outsiders due to its proximity to the city of Manicoré.

This over-harvesting compels residents to walk more than two hours inside the forest in search of forest products and wood "suitable" for making boats, canoes and houses. According to the leaders, residents have filed several complaints, signed several "petitions" and submitted them to the municipal authorities who took no action. These areas are rich in rubber trees, açai and wood (such as cedar, andiroba, virola, itaúba, angelim, marupá, among others) and thus subject to invasion. Illegal logging occurs especially during the flood period, when planks and boards cut by chainsaws at the extraction site, can be floated downstream. According to the residents, no family commercially harvests Brazil nuts due to the distances to the Brazil nut trees.

3.3 Emissions Trading Programs and Other Binding Limits

Brazil does not belong to Annex I group of the Kyoto Protocol and as such did not make compulsory commitments to reduce greenhouse gas emissions under the UN Climate Convention. Likewise, EBCF, a Brazilian company, also lacks any mandatory requirements to reduce greenhouse gases, and so any VCUs generated by the project activities will be the result of a voluntary initiative an unrelated to the mandatory target program for the reduction in GHGs.

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3.4 Participation under Other GHG Programs

Not applicable.

3.5 Other Forms of Environmental Credit

One of the strategies to generate revenue to finance the Management Plan activities is the sale of Environmental Reserve Quotas (CRA)13 arising from the surplus of the forest cover in the RPDS and subject to negotiation in the legal reserve compensation market.

3.6 Projects Rejected by Other GHG Programs

Not applicable.

3.7 Respect for Rights and No Involuntary Relocation

In the three workshops explaining the Carbon project to 15 communities, the eight REDD+ principles and the social and environmental safeguards were presented. Those safeguards were previously established in a series of meetings throughout the Amazon between 2009 and 2010, and included several Civil Society Organizations.

It was emphasized in the workshops that compliance with these principles and safeguards under REDD+ projects, such as the Amazon Rio carbon project, contributes to improving local governance, transparency of information, public participation in decision-making, coordination of actions among different actors and respect and recognition of the rights of indigenous peoples and traditional populations.

More directly, it was explained that these eight principles and safeguards guarantee that the rights of local populations (river dwellers, rubber tappers, indigenous peoples, farmers, and others) involved in REDD+ projects are respected, especially with respect to their rights to use the natural resources. It was also reinforced that these principles ensure that no community can be transferred to another location and/or prevented from continuing to practice their traditional extractivist activities.

Emphasis was placed on the fact that REDD+ actions should respect the Brazilian law, especially labor rights and laws relating to environmental conservation. Furthermore, international agreements ratified by Brazil must be respected. Also fair and equitable sharing of benefits arising

13 § 2, Art. 15 of the new Brazilian Forest Code (Law 12.651/2012) provides for voluntary forest reserves, i.e., the excess of forest required by law on rural property. According to this law all preserved area that exceeds the minimum required by law may be used for the creation of environmental easements or Environmental Reserve Quotas in the same biome or State.

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from the implementation of REDD+ project must also be ensured, focusing on disadvantaged groups in communities, such as women, young and old people and low income families.

Finally, the importance of ensuring the effective participation of communities in all steps of the REDD+ project, especially decision making, was stressed. Communities must have access to information related to the project, in a language that is easy to understand, including permited and prohibited activities, and the main results.

Free, Prior and Informed Consent (FPIC)

During the project workshops the concept of "Free, Prior and Informed Consent" was presented to the participants, as well as the importance of social and environmental safeguards to ensure the rights of communities in designing and developing the REDD+ project, explained in the eight principles. The participants were asked whether they were in agreement and if there were other principles or rights that should be included. Some community individuals expressed their agreement to the safeguards. All participants at the three workshops raised their hands in support of REDD+ project. The consent was unanimous.

A separate document describing the whole process of the "Free, Prior and Informed Consent" has been prepared and is available in Annex 10.

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Figure 6. Workshop I: Free, Prior and Informed Consent for the development of the REDD+ project by the community leaders of Democracia, Água Azul, São José do Miriti, Vista Alegre, Jatuarana, Terra Preta do Ramal, Pandegal, Santa Maria, Santa Eva and Terra Preta do Rio Mancoré.

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Figure 7.Workshop II: Free, Prior and Informed Consent for the development of the REDD+ project by the community leaders of Urucury, Mocambo, Boa Esperança and São João & Ponta Grossa.

Figure 8 Workshop III: Free, Prior and Informed Consent for the development of the REDD+ project by the Kamayuá indigenous community

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3.8 Illegal Activities and Project Benefits

Some illegal activities performed by some residents of the surrounding communities, such as the sale of game meat and wood, may negatively affect the project. Although these events are sporadic and localized, they will be restrained by the awareness and environmental control campaigns provided in the Management Plan.

Other more widespread and intense negative impacts may occur with the paving of State Highway AM-174 provided by the government in the near future in order to link Federal Highway BR-319 to the municipality and region of Manicoré. While this initiative represents an opportunity for the flow of production and facilitates supervision of the project, it poses a threat if the access to the Amazon Rio I Private Reserve is not strictly controlled. In this situation the RPDS may be subjected to pressures such as land grabbing, burning of forests, deforestation, timber extraction, capture of animals for sale and other environmentally harmful activities.

It is therefore essential that the project invest in a control and surveillance system that is effective and permanent. This system should rely on a modern system to acquire and update images to identify any environmental damage, as well as a land-based patrol system using 4WD vehicles. Surveillance and control based on participation and direct involvement of voluntary environmental agents should also be implemented. Such actions will bring direct and indirect benefits to the project area, from the environmental point of view as well as the social point of view.

4 APPLICATION OF METHODOLOGY

4.1 Title and Reference of Methodology

VCS VM0011: Methodology for Improved Forest Management – Logged to Protected Forest (LtPF): Calculating the GHG Benefits from Preventing Planned Degradation, version 1.0

4.2 Methodology Deviations

Whereas the VM0011 was developed in a context of homogeneous forests of temperate regions, some methodological adjustments were made related to the direct survey biomass in the field, since the project areas are comprised of very heterogeneous areas of rainforest including dryland and floodplains. Any technical documentation related to these methodological adjustments and their justifications appear in Annex 23 (Forest Inventory 2016) prepared by the consulting firm HDOM.

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4.3 Project Boundary14

The total area of the property is 20,387 ha (Figure 1) and a buffer zone was established around each of the four areas in order to include communities that use the resources within their boundaries (Figure 7a). Project activity areas (for purposes of calculating the emissions reductions called the project area or PA) are only those for which logging is permitted, a total of 19,800 ha (Figure 7b), excluding the Permanent Preservation Areas (APPs) and bodies of water. A logging plan has been approved for this area for selective logging (Annexes 1, 2, 3, 4, 6 and 7).

Figure 9. a) Project direct interference boundary and b) total project area

Stratification of the project area

For purposes of inventorying local carbon stocks and project management, the project area was stratified into 3 groups of different forest types, as indicated by the VM0011, according to the vegetation map SIPAM/RADAM (DPI, 2002). The forest types present in the area are rain forest types, divided into 3 categories as follows:

 Dense Primary Tropical Ombrophylous Alluvial Forest  Dense Primary Tropical Ombrophylous Lowland Forest

14 Ref.: section 2.2 of VM0011

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 Pioneer Formations

Figure 10. Project Area forest types

Leakage areas

There is no direct leakage resulting from planned project activities, since there will be neither displacement of management activities to other areas after the cessation of the activities within the project area, nor market leakages. The project Management Plan includes the monitoring of possible unanticipated leakages around the project area, as well as the need to report to the competent authorities whenever logging activities are identified in these areas. For more information on leakage, see chapters 5.2 and 5.5 of this document.

Temporal boundaries

Crediting period of the project

The first crediting period of the project is 37 years, beginning on August 17, 2011 and ending on August 16, 2049. This period corresponds to the remaining 12 years of the first management authorized plan approved by IPAAM and IBAMA (25 years from 1998) plus another 25 years that refers to a new forest logging plan, according to common forestry practices in Brazil. The logging activities may continue beyond the established 38 years into a second crediting period.

Monitoring and Reporting Period

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a) Monitoring of Baseline Emissions

The monitoring of Baseline Emissions must demonstrate that the protected forest area is in accordance with the one specified in the PD. The project limit will be monitored before each verification throughout the crediting period through new inventory information and remote sensing and GIS, as applicable. Thus, the project will be able to update the baseline calculations based on the actual remaining forest area (in case of loss of forest cover by disasters, for example) and that would be subject to forest management under a “without project” scenario.

b) Monitoring of Project Emissions

Project emissions will be monitored annually and compiled in every monitoring report that will detail in particular the:

 Monitoring of possible illegal harvesting of timber;  Monitoring of areas subject to natural disturbances;  Monitoring and quantification of emissions related to air and land travel related to project activities.

c) Monitoring of Leakage

Since there will be no leakages according to the VM0011 and AFOLU Requirements, no leakage monitoring will be necessary. However, to be conservative the project intends to monitor any disturbances that might affect the carbon reservoirs. Once some disturbance is registered, the project will report the incident to the relevant authorities and make the necessary adjustments to the baseline. For more details about the monitoring of leakages, see chapters 5.2 and 5.5 of this document.

Historical reference period

The approval of the timber logging plan in the project area occurred in 1998. By the end of 2009, six Annual Production Units (UPAs) had been logged. Thus, the historical reference period of the project (baseline) is 11 years. However the beginning of the project to date is August 17, 2012, when EBCF approved the business plan with its shareholders.

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Figure 11. Map of the managed UPAs

Between 1999 and 2005 (i.e. seven years) more than 50% of the timber was sold by the Gethal company to overseas markets as plywood (pg 51 of Annex 13, Annex 14 and Table 4 of Annex 15). The logging plan was certified by Smartwoods with annual reports and audits, as shown in the document gethal.pdf15 (Annex 14). In this scenario, given that less than 5% of the timber production is certified in Brazil and less than 2% of the wood is marketed in Brazil16, it follows that the wood from this area was sold at a very early stage and to very restricted domestic market. The next harvest cycle was 2006 to 200917 where 100% of the timber was sold on the domestic market without certification.

Carbon stocks

The biomass reservoirs considered by the project are related to above-ground and underground biomass.

15 Forest Management Public Summary for Gethal Amazonas SA Plywood Industries

16 http://www.institutocarbonobrasil.org.br/noticias6/noticia=119796 ou http://www.greenpeace.org.br/amazonia/face_destruicao.pdf 17 Since the Autex (ACOF) of UPA 5 and 6 was issued in February 2008, lasting 2 years, management continued to the end of 2009.

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Sources and sinks of GHGs

Table 5 below describes the emission sources and sinks of greenhouse gases associated with the baseline activities and with the project

Table 6.Greenhouse gas emissions sources and sinks associated with baseline and project activities

Source Gas Included? Justification/Explanation

CO2 Yes Main source of project emissions, through forest degradation, harvested and commercialised wood products, deadwood and forest regrowth Biomass CH4 No Conservatively excluded

N2O No Conservatively excluded Other No -

CO2 Yes Main source, through fossil fuel use in machinery and transportation of timber Fossil Fuel consumption CH4 Yes Conservatively included

N2O Yes Conservatively included

Other No -

CO2 Yes Main source

CH No -

Electricity 4 Baseline consumption N2O No -

Other No -

CO2 Yes Main source, through unexpected natural disturbances, such as forest fires, etc.

Biomass CH4 Yes Included but subject to significance

N2O Yes Included but subject to significance Other No _

CO2 Yes Main source, through flights and ground travel

Fossil Fuel CH4 Yes Included but subject to significance

consumption N2O Yes Included but subject to significance Other No _

CO2 Yes Main source CH No _ Electricity 4

consumption _ N2O No

Project Other No _

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4.4 Baseline Scenario

The choice between alternative baseline scenarios was taken together with the analysis of additionality using the latest version of the VCS Tool for the demonstration and assessment of additionality in "Agriculture, Forestry and Other Land Use" VCS projects in this case, VT000118,19 (VCS, 2012a). All possible scenarios as well as the analysis of methodology barriers (steps 2.1.1 and 2.1.2 of the VM0011) are present in the chapter below. In this sense, to avoid redundancy of information, refer to additionality analysis to find the steps 2.1.1 and 2.1.2 of the VM0011.

The baseline scenario for the project identified as the most likely to occur was selective logging20 (continuation of Business As Usual - BAU). The reference scenario assumes 38 years of selective logging, according to the 25 year logging plan, approved in August 1998 (Annex 6 - document: "Vald.II T01 POA 1998") that in the absence of project activities would be renewed in 2024 for another 25 years until 2049.

Under this scenario, the full implementation of the timber logging plan occurs and which has already resulted in the degradation of 4347.69 ha (see table below). The area would be harvested selectively for timber sold in lumber markets. Below is a summary of harvest areas between 1999 and 2010, showing the managed plots and the dates on which the harvests were authorized.

Table 7.Summary of areas managed since 1999

Date Managed/ logged area (ha) 1999 586.69 (Plot 1) 2000 688.0 (Plot 2) 2001 – 2002 831.5 (Plot 3) 2003 – 2004 750 (Plots 3 and 4) 2005 – 2007 1082 (Plot 5) 2008 – 2009 490.50 (Plots 5 and 6) TOTAL 4,347.69

4.5 Additionality

The additionality analysis of the Amazon Rio project REDD+ IFM was conducted with the latest version of the VCS Tool for the demonstration and assessment of additionality in Agriculture, Forestry and Other Land Use VCS projects, the VT0001,1819 (VCS, 2012a).

18 Tool for the demonstration and assessment of an additional to the VCS project activities in Agriculture, Forestry and Other Uses (AFOLU) (V 3.0)

19 Adapted from “Tool for the Demonstration and Assessment of Additionality in A/R CDM project Activities” (V.02) 20 Additional information about choosing the baseline are presented in section 4.6 (steps 1 and 2)

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To generate the reductions in GHG emissions for the project, the planned baseline activities (sustainable forest management) were terminated by the project proponent, and supplanted by environmental conservation activities. In this sense, the project will be managed by EBCF, with the goal of creating a fund for administrative and accounting management, especially to promote environmental management and monitoring activities of carbon pools within the project area.

Alternative activities planned in the project are the provisioning and valuation of environmental services, via carbon credits (VCUs) in conjunction with the sale of Environmental Reserve Quotas (CRAs).

The evaluation and determination of additionality of the project are shown in the "Step-by-step instructions" below:

Step 1) Identification of alternative scenarios and proposed land use activities in AFOLU projects

Sub Step 1a) Identification of credible alternative scenarios for land use activities proposed in the REDD+ project

Scenario 1 - Maintenance of Pre-Project Activities (Sustainable Forest Management - SFM)

This is the most probable land use scenario to occur, since before the start of the REDD+ project the area in question was subject to a forest management regime since 1999 and was suspended entirely in 2010 to give rise to the conservation project (REDD+). Under this scenario forestry activities would continue throughout the areas to sell timber in accordance with the Sustainable Forest Management Plan (SFMP) and their Annual Operational Plans (Plano Operacional Anual de Extração - POAs), already approved by the environmental agencies (Annexes 1, 2, 4 and 6).

Scenario 2 - Sustainable Forest Management and Farming

The sale of timber in accordance with the Sustainable Forest Management Plan (SFMP) and their Annual Operational Plans (POAs) on 80% of the PA and the clearing of forest cover on the remaining 20%21 for agricultural activities.

Scenario 3 - Farming without Forest Management

Complete cessation of the Sustainable Forest Management activities on 80% of the AP, removal of forest cover on the remaining 20% allowed by law for farming and grazing activities, and use of wood harvested from cleared land.

21 The new Brazilian Forest Code permits clearing on 20% of properties (multiple use area) that are within the

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Scenario 4 - Environmental Conservation Unregistered in VCS

Complete cessation of the Sustainable Forest Management activities and incentive of environmental conservation activities in a Private Sustainable Development Reserve (RPDS) without being registered as a VCS AFOLU project.

Sub Step 1b) Consistency of possible alternative scenarios with applicable legislation and standards

Federal and state law does not restrict any of the four scenarios described in the previous step. All the above options were available to the applicant at the time of the decision to create the RPDS. All four scenarios were therefore legally supported by regulations of the Forest Code in force at the time, a fact that has not changed with the publication of the new Forest Code 22 published in 2012. It is important to remember that the Forest Code regulates precisely what can and what cannot be done with respect to land use on private properties.

Native vegetation logging activities, represented by scenarios 1, 2 and 4 are also in perfect accord with the Federal Decree that regulates logging activities23 (Chapter II) and native vegetation clearing regime and alternative land use (Chapter III).

Based on the above, one can concluded that the four alternatives listed in sub-step 1a do not conflict with any requirement or legal regulations of the host country, and are therefore plausible and applicable under the additionality analysis options.

Sub Step 1c) Selection of the Baseline Scenario

According to IBGE Cidades (2013), the main economic activities of the municipality of Manicoré are linked to Plant Extraction and Forestry24, the city is one of the major leaders in the production of roundwood and fuelwood in the state, also corroborated by IDESAM 25 (Vianna, 2013).

In going against the EBCF business strategy and statute (Annex 19), the project proponent is not expected to exercise his right to clear the forest cover on 20% of the property for agricultural activities, and so scenarios 2 and 3 are unlikely from both business strategy and profitability26 perspectives and may be discarded.

22 Law No. 12651 of Friday, May 25, 2012. 23 Decree No. 5.975 of November 30, 2006

24 IBGE Cities - Plant Extraction and Forestry (2011) 25 Forest diagnosis of the state of Amazonas - 2010 and 2011 26 As a premise it is assumed in this case that the most common agricultural activities alternatives in the region offer lower profitability than the SFM.

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Given this context and the associated historical activities in the PA (licensed SFM), the most likely future scenario, in the absence of the IFM project, would be the continuation of logging activities (scenario 1) and the GHG emissions associated with it.

In steps 2 and 3 below the additionality of the project compared to the baseline scenario will be verified judiciously, and evidence will be presented to support this scenario as the most likely to occur if the project could not rely on the VCS/CCB certification and the revenues from the sale of VCUs.

Step 2) Investment analysis to determine that the project activity is not the most economically or financially attractive of the identified land use scenarios

Sub-step 2a) Analysis of the Appropriate Comparison Method

Whereas the project provides for the revenue generation from the ARCs sale, as well as VERs sale, the option that makes the most sense under the VT0001 v.3, is Option II (economic investment comparison analysis).

Sub-step 2b) Option II - Application for Investment Comparison Analysis

The IRR (Annual Internal Rate of Return) was chosen as the economic indicator, as this is a consolidated economic indicator and one of the most widely used for making investment decisions. NPV was chosen as the corroborating indicator. Thus, the project IRR was compared without the revenue from VER’s (Annex 16), with the SFM economic activity in a "without project" scenario (Annex 17).

Sub-step 2c) Calculation and Comparison of Financial Indicators

The comparative analysis between scenarios was done by comparing the IRR and NPV economic indicators of the project IFM (Annex 16) and the SFM obtained from historical data in the pre- project (Annex 17). In order to improve the robustness of the comparative analysis and its conclusions, references to IRR/NPV from other SFM projects were included, obtained from an extensive literature review on the subject. The following table presents a comparison of REDD+ project financial indicators and the baseline scenario (SFM).

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Table 8.Internal Rate of Return (IRR) and Net Present Value (NPV) of various SFM activities and REDD+ project activities

Activity27 IRR (%) NPV Scenario Source

Forest EBCF Baseline 22.2% R$ 11,117,123.26 1 Management* (2013) - Annex 17 Forest 5.9% - 1 FSM (2012) Management* Timofeiczyk, Forest 1.7% -R$ 37,083,362.00 1 Júnior, R. et al. Management* (2008) Timofeiczyk, Forest 27.5% R$ 3,857,823.00 1 Júnior, R. et al. Management (2008) Forest 22.9% R$ 2,328,833.55 1 IFT (2010) Management Forest 5.1% -R$ 6,650,133.10 1 IFT (2010) Management* REDD+ project EBCF (2013) - 18.5% R$ 157,315.51 4 (with VERs) Annex 16 REDD+ project EBCF (2013) - - -R$ 3,695,704.78 4 (without VERs) Annex 16

* Initial investment considering land with forest purchase

As shown in the above table, the economic attractiveness varies greatly in an IRR and NPV analysis in different possible SFMs and in carbon and Environmental Reserve Quotas (CRAs) trading. However, the table clearly shows that economic analyses of SFM activites without exception, are more attractive with respect to return on investment, compared to Scenario 4, or no sale of VERs (only CRAs). This is because, while unregistered in VCS, the project relies exclusively on the revenue from the sale of CRAs, which is the economically less attractive scenario of those analyzed.

Therefore SFM, the most likely baseline scenario for the RPDS, appears to be the activity with the highest financial returns.

The comparative analysis presented in this section clearly shows that without carbon credits (VERs), the project is economically unsustainable, and so will give way to the alternative scenarios, becoming additional. In other words, the project depends entirely on the VCS/CCB

27 All references cited adopt Reduced Impact Logging premises in the SFM.

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registration to become minimally attractive28 and competitive in relation to possible alternatives. To confirm this hypothesis, the next step presents a sensitivity analysis for CRAs price changes and the project's administrative expenses, in order to verify whether value fluctuations interfere in the outcome of this analysis.

Sub-step 2d) Sensitivity Analysis

For sensitivity analysis, variations in the CRA (main source of income) prices use and in the RPDS administrative expenses (main source of costs), since this value was the main parameter determining project costs (approximately 70%). This variation was applied to the cash flow in Scenario 4 (CRAs sold without VERs), identified as the most likely baseline scenario. The results of the sensitivity analysis are presented in the following tables:

Table 9. Sensitivity analysis under different scenarios with variations of +5%, +10% and +20% in CRA prices29

Sensitivity IRR (30 CRA price NPV (12%) Scenery Analysis years) (R$/ha)

-* -R$ 3,695,704.78 R$ 120.00 Current Variation in the CRA -* -R$ 3,589,373.72 R$ 126.00 +5.0% price -* -R$ 3,483,042.67 R$ 132.00 +10.0% -* -R$ 3,270,380.56 R$ 144.00 +20.0% * IRR could not be calculated, since the project is not profitable.

The sensitivity analysis demonstrated above showed no impact on the project IRR, since even in a scenario where CRAs are sold at a value 20% higher than the one adopted, the project still remains economically unfeasible, preventing an analysis via IRR. On the other hand, NPV allows variations resulting from increased CRA values to be explored. Even in the best case scenario (+20% in value), the project remains economically unfeasible, even if "less unfeasible."

Table 10.Sensitivity analysis given variations of -5%, -10% and -20% in the project administrative costs29

Sensitivity IRR (30 Administrative NPV (12%) Scenery Analysis years) Costs Price (R$) -* -R$ 3,695,704.78 R$ 24,069,915.00 Current Variation in -* -R$ 3,459,326.38 R$ 22,866,419.25 -5.0% Administrative -* -R$ 3,222,947.98 R$ 21,662,923.50 -10.0% Costs -* -R$ 2,750,191.19 R$ 20,579,777.33 -20.0%

28 It is Important to emphasize that at the time the decision was make to create the RPDS to replace the SFM, which occurred in 2010, the voluntary carbon market was much more attractive, with prices and demand for VCUs, much more favorable than the current ones. 29 See Annex 16.

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* IRR could not be calculated, since the project is not profitable.

Whereas similar to the previous approach, reductions in -5%, -10% and -20% in administrative costs were analyzed, in order to explore the viability of the project against reductions in fixed costs of greater impact on the activities total costs (70% of total). Even in the face of a 20% reduction scenario in this item of expenditure, the project still cannot acheive a minimum IRR with which to compensate its investors.

It is clear from the sensitivity analysis shown above that a project unregistered with VCS/CCB has no chance of becoming economically attractive, and in fact represents a loss to its investors. A project configuration that prioritizes the marketing of CRAs without carbon credits sales, is not feasible, nor is it able to compete with the economic attractiveness of the baseline scenario based on the continuity of the SFMP (see Annex 17).

Step 3) Barrier analysis

In purely economic and financial terms – as presented in Step 2 (Investment Analysis) – the activities proposed by the project (environmental conservation and CRA sales) are not economically attractive. This is especially clear when the project scenario is compared with the baseline scenario (already licensed logging management - Scenario 1), which from an economic point of view, emerges as the most likely scenario. Additionally, there are a number of non- economic barriers that render the REDD+ project implementation more difficult without carbon credits. This was widely discussed by members of EBCF, project proponent and described in Annex 20.

Therefore, the main identified barriers that may prevent the continuation of the project by the proponent, which could be mitigated once the project is registered to VCS/CCB standards are: i) investment barriers; ii) institutional barriers; iii) technological barriers; iv) barriers related to local traditions; v) barriers related to common practices

Sub-step 3a. Identification of barriers that may prevent implemention of proposed project activities

a) Investment barriers

As this is a project that relies on a single source of revenue, which is still rather uncertain30, the investment profitability, besides being low, is also risky. For this reason, the applicant has encountered difficulties in finding investors interested in supporting this environmental conservation project. Initially, EBCF had plans to invest in sponsorship for areas under its

30 Despite already having legal framework, there is still no consolidated market for CRAs, so there is huge uncertainty about the value and liquidity of shares.

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management, as is the case of this project, to fund socioenvironmental programs and activities, however, the strategy has not attracted investors as originally planned. In this case, it is believed that the visibility generated from the project registration in VCS/CCB can partially reverse this situation.

Another investment barrier is the fear of potential investors’ of participating in a pioneering project. The project includes the first Private Sustainable Development Reserve in the world, according to information released by the Government of the State of Amazonas31, in which case there is no case study to serve as a model or example, making the initiative more risky from the investment return point of view. In this case, it is also believed that the registration with the VCS and CCB standards would bring more credibility to the project as a whole, since the carbon credits would emerge as an additional source of revenue, in addition to increased visibility (and greater marketing appeal) to the project.

b) Institutional barriers

When analyzing the current situation of other protected areas in the state of Amazonas, the institutional setting is revealed as unfavorable to the creation of new conservation units. According to a recent State Audit Court report (TCE/TCU32) the management and implementation of 41 State conservation areas created and implemented since 2003 lack adequate financial resource allocations from the state. The amount transferred by the state government was BRL 540.3 thousand, making them highly dependent on external resources. Between the years 2008 and 2012, these conservation areas received BRL 90.7 million from public and/or private partnerships, and the Government was responsible for the resource management.

However, the transfer amount has not been sufficient to meet the needs of the state’s conservation areas. The lack of staffing and infrastructure are among the most serious problems, resulting in reduced effectiveness in the process of land titling and reduced control and protection, leading to land grabbing, especially in protected areas located in the south of the state of Amazonas.

Besides these difficulties, there are also problems with biodiversity monitoring mechanisms and insufficient access to public policy. The river bases that support the supervision of conservation units have been abandoned and in disrepair. Such abandonment scenarios in conservation areas reveal the challenges that the project will face. Although some of the institutional barriers listed above are associated with the lack of priority in the political sections, the lack of resources

31 http://www.amazonas.am.gov.br/2010/11/amazonas-o-pioneiro-na-criao-de-reserva-particular-de-desenvolvimento- sustentvel/ ; http://acritica.uol.com.br/amazonia/manaus-amazonas-amazonia-Reserva-Particular-Desenvolvimento- Sustentavel-meio_ambiente-Governo_0_932906709.html

32 http://www.tce.am.gov.br/portal/?p=8848 ; http://portal2.tcu.gov.br/portal/page/portal/TCU/imprensa/noticias/detalhes_noticias?noticia=4913062

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emerges once again as basis for the formation (or increase) of new barriers. In this case as in the previous one, carbon credits would emerge as an element with the power to "compensate" through revenue, some barriers of institutional character.

In the political-institutional context, the discontinuity of actions and policies to support the maintenance and creation of conservation units (public and private) is also apparent, mainly due to the change of governments, focus and objectives. Another barrier, of a political character, which already affects the project, is the incipient National and Subnational regulation regarding incentives and financing programs aimed at climate change mitigation and valuation of environmental services.

Laws concerning the establishment of a REDD+ mechanism and a compensation system for environmental services have been discussed for some time with the civil society and the state governments, but they are still under consideration by the National Congress and the Federal Senate, with no definite date for approval.

c) Technological barriers

The technological barriers referenced herein are associated mainly with the "social technologies", e.g., the project’s ability to harmoniously manage the non-timber management activities of traditional communities, as well as strategies for managing conflicts that may arise among and within communities. In this case, it is believed that the registration of the project under the CCB standard and the subsequent activities in line with the guidelines of this standard will serve as an important tool to overcome this barrier.

d) Barriers related to local traditions

Because it is a pioneering initiative, the project is subject to a number of adverse situations which, due to the lack of similar references, cannot be fully planned, but that should arise mainly because of the unfamiliarity of the communities involved, as well as the proponent regarding the new management dynamic which includes, among other challenges:

 The regulation of non-timber management, devoid of any prior control;  Social monitoring, biodiversity and carbon stock activities;  Tighter control of non-timber extraction activities;  Compulsory use of personal protective equipment (PPE) in field operations;  Suspension of any clearing and coivara33 within the project area.

e) Barriers related to common practice

33 Use of fire as a management tool for clearing new areas

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Since it is the first initiative of its kind (converting a SFM area to RPDS), it is expected that the project will face problems of all kinds by not conforming to common practices in the region. Unlike other activities (SFM, for example), the project cannot rely on any reference cases that may offer solutions to the conflicts and problems that may arise from the creation of RPDS and/or the implementation of the Management Plan.

The creation of four private sustainable use reserves in the Amazon, the first private areas designed to be follow a sustainable use program, resists common practices in that region, which includes illegal logging, among other 34,35 activities. Even the most recent activities introduced in recent years in the region, such as SFM, can be considered commonplace (thought it has a learning curve) in the context of the state, when compared to the initiative to create a RPDS. Thus, the project will be a conservation "island" with activities regulated by a Management Plan within a context of logging (legal and illegal) and uncontrolled non-timber management to which community residents have become accustomed.

However, the management of this conservation unit is expected to be more efficient, especially due to the fact that the market revenue from the carbon market and CRAs will be managed by a company – whose main business is reinvest in conservation activities – and not by public institutions that usually lack infrastructure and adequate staffing.

However, it is important to note that the sale of CRAs has only recently been regulated with the enactment of the new Forest Code in 2012, and on that account it is not yet widespread nor can it be considered established practice, reinforcing the importance of the sale of VCUs as a source of revenue.

f) Barriers due to social conditions and land use practices

Finally, besides the barriers described above, others of a more comprehensive social nature are highlighted, such as: the tendency for the local population to increase which will lead to greater demand for goods and services in the project areas and will intensify activities (legal and illegal), such as land grabbing, logging, harvesting of NTFPs, fishing, among others.

34 Lábrea, Humaitá and Manicoré take actions against deforestation - http://www.amazonas.am.gov.br/2011/05/lbrea-humait- e-manicor-recebem-aes-contra-desmatamento/

35 Government sends 'National Force' to a community in Manicoré (AM) - http://acritica.uol.com.br/noticias/Governo-Forca- Nacional-Manicore-AM_0_566943618.html

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This increase in the demand for products and services currently offered by the project areas, tends to generate and enhance future conflicts between beneficiaries and communities. Thus, strengthening the project management capacity which, in turn, is directly related to the VCS/CCB registration and the revenue from VCU's sales, is critical so that such conflicts will not undermine the implementation and continuity of the project.

Step 4) Common practices analysis

As previously discussed, the creation of an RPDS does not constitute common practice in the Legal Amazon, and it is in fact the first initiative of its kind in the country36. Thus, the project as a whole, composed of an RPDS to replace previously licensed logging activities, not only contradicts common practice in the country, but it is pioneering and therefore innovative.

Moreover, efforts to combat deforestation and forest degradation are still rare in the project region, a claim reinforced by Soares-Filho 37 et al. (2010) who demonstrate heavy deforestation pressures to which the UCs of the Legal Amazon UCs are subject.

The urgent need for investments for the maintenance of the biodiversity and forests with the objective of reducing deforestation and forest degradation, especially in the arc of deforestation38, is another factor that illustrates the discrepancy between the project activities and common practice in the region.

An IDESAM study (VIANNA, 2013) also concludes that the city of Manicoré contributes significantly to the timber industry in the state and has been considered a strategic hub mainly due to its geographical location and accessibility. An IBGE survey (2013) also corroborates the claim that Scenarios 1, 2 and 3 are common practices (step 1), since the agricultural sector was an important contributor to the GDP of the city in 2010 (approximately R$ 170,000.00.) Domingues et al. (2012) lists the most common practices in the area:

a) selective logging and subsequent deforestation for farming activities; b) itinerant agriculture, with a low technological level that uses fire to clear pasture; c) low technical level and damaging cattle ranching.

The above elements demonstrate the project’s additionality, aligning step 4 findings with those obtained in steps 2 and 3.

36http://www.ebcf.com.br/blog/2013/06/24/criacao-da-primeira-reserva-particular-de-desenvolvimento-sustentavel-do- mundo-na-floresta-amazonica/

1 37 Role of Brazilian Amazon Protected Areas in Climate Change Mitigation 38 O arco de desflorestamento na Amazônia: da pecuária à soja.

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5 MONITORING

5.1 Monitoring Plan Description

Due to its innovative, comprehensive and integrative character, the project needs to be monitored regularly so that its actions, activities and impacts can be constantly measured and evaluated. To meet this requirement, the monitoring process must meet three main objectives:

i. To serve as an internal management project tool;

ii. To collaborate as an instrument of collective learning from the communities and social groups directly involved;

iii. To work as a means of communicating results and impacts to interested institutions and society in general. Furthermore, it is important to consider that monitoring, if successful, will transcend the managerial aspects of the project and strengthening the plan.

To facilitate the monitoring process, instead of having a reference line (to compare interventions before and after), the first year of monitoring will serve as the starting point, whose information will be regularly and systematically compared throughout the project.

Next, the initial plans for monitoring benefits to the climate, community and biodiversity are described, wherein the community is committed to participatory precept and to the technical and scientific rigor, which is capable of following the possible negative and positive impacts on environmental and social aspects in the project area and its surroundings.

5.1.1 Monitoring of Climate Impacts

The Monitoring Plan (MP) aims to provide security in the periodic estimates of reduction in emissions, especially in monitoring changes in carbon stock. Therefore emissions from the implementation of the project, ex post estimates of the activities and emissions from any leakages and isolated disturbances (e.g., blowdown, fires, pests and diseases, among others) can be calculated.

The construction of the PM of the climate benefits made in full compliance with the methodological framework provided by VM0011 – IFM LPF (VCS 2011) and CCBA (2008), which consists of four specific actions to be monitored:

i. Implementation and execution of the project; ii. Dynamics and stock of the forest biomass; iii. Deforestation and forest degradation;

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iv. Periodic reviews of ex post emissions.

Remote monitoring and surveillance of the project area

Measurement of alterations and biomass loss quantification present in the PA using land use change detection is critical to make accurate estimates of GHG emissions that account for forest biomass increases and losses.

Thus, the use of remote sensing by satellite images of medium spatial resolution can be applied readily in the PA and surroundings in order to monitor land use dynamics over time, particularly to identify risks and threats to forested areas. In situ verification will complement landscape analysis in a GIS environment with the aim of quantifying, spatializing and identifying conversion of forest areas into other land uses, environmental degradation and other possible changes that may occur during the term of the project.

As a complementary monitoring source, the project will rely on the database and information provided by Monitoring Program of the Brazilian Amazon Forest by Satellite 39,40(Prodes Digital), conducted by the National Institute for Space Research (Instituto Nacional de Pesquisas Espaciais - INPE), according to the Plan for Prevention and Control of Deforestation in the Amazon 41,42(PPCDAm) under the National Policy on Prevention and Control of Deforestation. Such information is available online in43 digital vector files for the public in general.

Other tools will provide complementary information to the monitoring, such as indicators of forest degradation and hotspots (fires and wildfires) obtained from DETER 44 , SAD 45 , and PROARCO46. Information is available online for free in vector format. These results will be systematically related to field data for validating or disproving the occurred event, so that the focuses of deforestation and degradation can be identified, remediated, reported, and consequently avoided as much as possible.

A surveillance system that allows permanent territorial monitoring and inhibits the entry of intruders through entry points in the PA will also be deployed to control the transport flow. In addition, one

39http://www.obt.inpe.br/prodesdigital/metodologia.html

40http://www.obt.inpe.br/prodes/metodologia.pdf 41http://www.mma.gov.br/florestas/controle-e-preven%C3%A7%C3%A3o-do-desmatamento 42http://www.mma.gov.br/images/arquivo/80120/PPCDAm/_FINAL_PPCDAM.PDF 43http://www.obt.inpe.br/prodes/index.html 44http://www.obt.inpe.br/deter/dados/ 45http://www.imazongeo.org.br/doc/downloads.php 46http://www.dpi.inpe.br/proarco/bdqueimadas/

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must investigate and identify risks and threats, e.g., mapping hotspots and areas vulnerable to fire, to illegal logging, to hunting and poaching, and to invasions by third parties, among others.

At first, we estimate an effective demand for structuring the electronic monitoring system, which includes the hiring of skilled professionals, field equipment, electronic equipment (digital cameras, GPS, desktops and notebooks, smartphones, printers, geoprocessing software and GIS, among others), vehicles and/or motorcycles, motorized boats for transportation and moving around and the collection of high resolution satellite images. Empowerment and training of all involved staff and the surrounding communities will be necessary to make the system effective47, and a constant stream of information directed to regional actors, and other stakeholders.

Strategic monitoring and access points to RPDS roads will also provide support to other MPs, including social and biodiversity conservation aspects, especially in the logistic support of planned field activities.

Procedures for determining the permanent sample plots (PSPs) and measurement

The calculation of the stock and increase in forest biomass will be subsidized through the installation of PSPs in the PA and its temporal monitoring through the Continuous Forest Inventory (CFI). The methodology proposed by VCS (2011) suggests the use of permanent and/or temporary plots, however, it confirms the efficiency and accuracy of sample plots.

In order to demonstrate the procedural and statistical rigor used, all the sampling procedures, the PA forest stratification, sampling design, calculation of sampling intensity, and other parameters measured in PSPs to monitor biomass balance due to ingress/mortality of individuals, growth in DBH and height will be presented in detail in the Annex (Annex 23 - Forest Inventory 2014).

To promote reliable forest biomass estimates, standard operating procedures (SOPs) (Section 8.2) will be used by the team executing the CFI.

The project provides standardized procedures and routines to improve primary data collection, recording, analysis and quality control, interpretation and systematization, as well as for storage and query of an integrated database, with the clear objective of promoting transparency in the measurement and document traceability of all activities planned. The monitoring review frequency will depend on the monitored parameter, as shown in Section 8.2.

Stratification of the project area

47Linking community monitoring to national Measurement, Reporting and Verification for REDD+

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In order to increase the sampling accuracy and precision, we divided the PA into three different strata to reduce both initial FI and monitoring sampling intensity and operating costs. The stratification was based on different vegetation types present in the project area. According to SIPAM / RADAM rating (DPI, 2002). 3 different vegetation types were identified:

A. Primary Tropical Ombrophylous Alluvial Forest B. Primary Tropical Ombrophylous Lowland Forest C. Pioneer Formations

The characterization of each type of vegetation is shown in Section 4.4 and in the Management Plan (Annex 9).

PSPs shape and size

As it will be shown in Annex 23, plots will be rectangular measuring 125 by 25 meters. Higuchi (1982) affirms that rectangular plots are the ideal size for forest sampling in the Amazon, and provides practical and economical guidelines in choosing plot size for this purpose.

Sampling intensity and number of PSPs

The completion of a preliminary inventory will determine the sampling intensity per stratum to obtain a sample with less than 10% and 95% confidence error. The CFI will be guided through steps 1-9 described in section 7.1.2.3 (VCS 2011), culminating in the application of equation 7.3 to calculate the optimal number of samples per stratum.

PSP sampling design

The methodology is flexible with respect to the sampling design, which can be chosen from among the most common practices, such as random, stratified, systematic stratified, among others. More information is available in Annex 23.

Parameters measured in the PSPs

The monitoring will be carried out in different stages of succession (different DBH intervals). Parameters for both trees and palms to be monitored are as follows:

 Record of each individual measured by numbered aluminum tags;  DBH measurement of individuals within each PSP;  Location, size and georeferencing of PSP vertices.

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All parameters will be recorded in the field in digital and/or analog spreadsheet format. To ensure transparency in the process, responsibilities and obligations shall be clearly defined among the parties involved, especially for recording and presentating all methodological procedures used primarily in the implementation of measurement activities in the field. Besides clarity in processing and data entry, an accessible data systematization model will be crucial for future verification of the database.

A calculation with all applicable and relevant statistical parameters derived from sampling (error, confidence interval, mean, standard deviation, confidence interval, optimal number of parcels, etc.) is also presented in Annex 23 in order to verify formulas and traceability in the accuracy of the average biomass estimate. That Annex will also include the photographic record, list of materials, references and applied values, and other relevant information.

Monitoring frequency

The monitoring frequency parameters measured in the PSPs will be no greater than 5 years from the first measurement. Other relevant parameters to monitoring the PSPs, like the change in land use in the PA and surrounding areas such as deforestation, forest degradation, fire sources and natural disturbances will be regularly monitored as a project routine operation, organized and archived annually.

QA/QC - Measurement activities in the field

The CFI measurement activities in the field in the IFC will be performed by staff with expertise in the Amazon region. One EBCF staff member will begin monitoring field activities to verify consistency of procedures and general patterns of allocation and sizing of PSPs, identification and DBH measurement of individual trees within the PSPs. Soon CFI best practices will be adopted stated as follows:

 Ensure measurement and allocation of PSPs is standardized, does not deviate from procedures, and serves mainly to verify the reliability of field activities,  Use of appropriate measuring equipment and utilities (e.g. tape, GPS navigation, compass, red paint, stakes and others);  Observations on the positioning of the height measurement of the diameter of the stem to 1.30 meters from the ground (eg, buttresses, bifurcations, relief, slope of the trunk, lianas, among others);  Marking of trunk height with red paint where measured for posterior identification;  Measuring trunk height (H) of the fallen trees within the PSPs and surrounding areas with tape measure is recommended to assess precise values.

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 Collection and botanical identification (common name, scientific and family) of each individual;  Listing with the potential for non-timber use of each species;  Use of paper and digital field spreadsheets customized for recording the parameters measured in the field;  Photographic records of the PSPs of all relevant procedures;  Marking initial and final vertices of PSPs and internal area of the plots;  Demarcation, clearing, and georeferencing of access trails;  Mandatory use of personal protective equipment (PPE) and appropriate field clothing for staff, first aid kit, antivenin, water containers, backpacks, proper nutrition, among other precautions.

QA/QC - Selecting values from the literature

This document was developed by a multidisciplinary team with extensive technical experience on this subject. The applied parameters derived from the literature were widely discussed and grounded in an extensive literature review and conservative estimates were always sought. Section 7.2.1 of the VM0011 methodology lists and describes the auxiliary parameters and their technical and scientific sources, which served as the basis for drafting this MP.

QA/QC - Data entry and filing

Usually the input data for estimating biomass are recorded by hand (printed sheets) or digital (tablet+ODK) in field sampling. We intend to hire a team with extensive experience in using ODK to empower EBCF staff. The staff member in charge of this activity should have experience in forest inventories. After field activities, collected data will be taken to the office for data entry and processing.

The possibility of using digital spreadsheets will also be verified48,49 in the field, thus enabling preliminary analysis of the data collected before returning to the office, adjustments in procedures during data collection activities to be made in real-time.

The proponent of the project will also be responsible for the processing, systematization and digital (spreadsheets, photos, GIS files) and analog storage (spreadsheets field books) of information in the appropriate database for at least 2 years after the end of the crediting period, promoting transparency and availability of data in the audit process.

Risk analysis and non-permanence

48Open Data Kit - http://opendatakit.org/ 49ODK Collect - http://opendatakit.org/use/collect/

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Determination of buffer reserve was conducted using the AFOLU Non-Permanence Risk Tool V.3.2 (VCS, 2012b)50 considering the leakage and increased emission risk. Annex 22 shows the analysis and respective internal, external and natural weights of the various activities of the project risks.

Ex-post calculations of anthropogenic GHG emissions reductions

The baseline calculation should be updated, if applicable, during the verifications, along with project activity emissions and possible leakages. In this context, any change in land use, changes in the dynamics of forest carbon, or catastrophic events, will be monitored and recorded. In general terms, the behavior of agents and vectors potentially related to forest degradation or any other aspects which may impact the flow of carbon in the PA will also be monitored.

Calculation updates for ex post accounting follow the procedures contained in 1-10 of section 7.4 in the VCS (2011).

5.1.2 Monitoring Impacts to Biodiversity

Since animal inventories have not been conducted in Amazon Rio project areas (for this project biological information for the Rio Amapá RDS management plan were used), a biodiversity monitoring system that will follow the RAPELD methodology (Rapid surveys of various taxonomic groups (RAP) for long-term ecological studies) (MAGNUSSON et al, 2005).

The RAPELD method contributes to long-term research using rapid inventory assessments, biotic complementarity, and land use planning in the Amazon. This method increases adequate sampling probability of biologically diverse communities, which require large areas and at the same time minimize variation of abiotic factors that affect these communities with smaller areas sampling.

After the implementation of this methodology in project areas, the observation will be continued by community monitoring of plant biodiversity, which is to be implemented through the project coordination. This should occur after the proposal submission, consent and effective involvement of the surrounding communities that use natural resources reserves for hunting, fishing and forest extraction.

The biodiversity monitoring plan of the project is integrated into the Program for Monitoring Biodiversity and Use of Natural Resources in Conservation Units (ProBUC) from the Secretary of Environment of the State of Amazonas (SDS), created in 2005 by the Amazonas State System of Protected Areas (SEUC) (MARINELLI, et al., 2006). The ProBUC model51, supported by ARPA52,

50http://www.v-c-s.org/sites/v-c-s.org/files/AFOLU%20Non-Permanence%20Risk%20Tool,%20v3.2.pdf 51PROBUC 52Amazon Region Protected Areas (Áreas Protegidas da Amazônia - ARPA)

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is being implemented in some conservation units of the state of Amazonas, and has proven to be an innovative initiative. This program minimizes costs, provides rapid answerer and results, and generates reliable and concise data storage. This is because it is conducted by local workers active in their daily work, thus facilitating all the logistics involved in biodiversity monitoring, as well as the social improvement of the communities surrounding the Reserves.

Like ProBUC, the project's community monitoring system will have the following objectives: 1) raise the awareness of communities using the project area about the relevance of monitoring the use of natural resources, with a focus on sustainability; 2) train leaders and interested people to act as biodiversity monitors; 3) monitor species with communities use potential; 4) monitor species of special interest (critically endangered, endangered or threatened with extinction, and 5) monitor land use and land cover changes.

According to the objectives above, field work is directed toward a better understanding of the use of natural resources by the logic of land cover changes dynamics and local animal use in the PA and in places of potential leakages. Such measurements will strengthen the enforcement of existing legislation, ensuring the successful implementation of project activities.

Evaluation and selection of indicators will be conducted in accordance with the ProBUC model, however, applicably to local reality, results will be updated biennially from the first survey. Biodiversity indicators are being designed and planned, as suggested in the Social and Environmental Monitoring System of Protected Areas in the Brazilian Amazon (Sistema de Monitoramento Socioambiental das Unidades de Conservação da Amazônia Brasileira)53,54 and Methodology for Rapid Assessment and Prioritization of Protected Areas Management55 (Metodologia para Avaliação Rápida e Priorização do Manejo de Unidades de Conservação - RAPPAM) in line with the experiences gained and disseminated by CEUC and ICMBIO previously described.

The empowerment, accountability and shared management of biodiversity conservation is the main focus of the methodological model adopted. These actions create high expectations for environmental management of the area, as the biodiversity monitoring will be conducted by the community members themselves along with the project proponent, promoting a local multiplier effect. It is worth mentioning that strict compliance with these procedures is in within EBCF`s interest since it considers them to be key to the success of the project.

53Indicator Design 54Social and Environmental Monitoring of Protected Areas System in the Brazilian Amazon (Sistema de Monitoramento Socioambiental das Unidades de Conservação da Amazônia Brasileira) 55Metodologia para Avaliação Rápida e a Priorização do Manejo de Unidades de Conservação (RAPPAM)

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The project begins with the premise that any negative impact on biodiversity in the project area and its surroundings will not occur. In the opposite sense, the project aims to generate and provide greater understanding of the territory, subsidizing proposals for the conservation and sustainable use through adoption of good management practices of natural resources as well as its replication in other locations.

5.1.3 Monitoring Social Impacts

The monitoring of social aspects include both the collection of numerical data, such as quantity, volume, weight (quantitative indicators), as well as information expressing opinions and experiences (qualitative indicators), remembering that such measures are compatible and interchangeable. Data collection should be systematic and have a pre-established rate and, most likely, a single indicator will require several data collection instruments such as plans, field records, reports etc.

Social information will be monitored through the use of participatory methodologies. In this sense, the preparation process of the Amazon Rio I RPDS Management Plan was a first step. For the socioeconomic characteristics of communities, several community meetings, land use mapping workshops, and interviews with focus groups were held, in addition to field visits (Annex 10). The main activities of the project were presented and discussed in these events, emphasizing the importance and timeliness of local valuation of environmental services, as well as strategies for raising funds to implement other projects and improvements in social well-being of communities around the PA.

A Participatory Rural Diagnosic (Diagnóstico Rural Participativo) (DRP)56 must be carried out once in possession of information related to social characterization to complement the socioeconomic analysis of local communities. This diagnostic will collect historical, social, environmental, economic and institutional information from the communities surrounding the Reserves, including indicators and related social conflicts and grievances arisen from the implementation of the project parameters. This set of information will provide the "starting point" for monitoring of various production, economic, social, environmental and cultural aspects of the communities around the PA.

Since participatory monitoring is a procedural activity, new collection and analysis skills and tools will be required. Therefore, the monitoring plan will begin simply and include only some aspects of the project and, to the extent that the experience evolves and capacities are built up, monitoring may be slowly expanded to allow a more comprehensive assessment of social impacts.

56Diagnóstico Rural Participativo – Guia Prático - http://comunidades.mda.gov.br/o/890598

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In view of the adoption of this procedural strategy, the monitoring plan is still under development and thus not all parameters and their sampling methods are defined. The details of the PM will be treated afterwards, considering the following limitations:

 Available budget, in view of the high costs in terms of logistics of this activity;  Location/mapping of community groups that are users and have an interest to participate in the project;  Sampling intensity and frequency of assessment;  Methodological adaptation according to local reality and project objectives;  Parameter identification and indicators to be analyzed.

Finally, it is important to emphasize that the project does not clearly provide for negative impacts to the PA and local communities in the surroundings. The project aims to be an ally of communities in promoting improved local life quality and social welfare to facilitate, replicate and build new partnerships for sustainable activities, besides proposing and testing best practices management and use of natural resources along with communities.

5.2 Data and Parameters Available at Validation

Dat Unit / Parameter: DBHn,i,s, j ,t=0

Data unit: Centimeters Description: Diameter at breast height, t=0 years Source of data: Field measurements in PSPs Description of measurement methods Validated/verified before the start date of the and procedures to be applied: IFM-LtPF project for PSPs and areas with possible disturbances. Frequency of monitoring/recording: At intervals not exceeding 5 years from the first measurement Value Applied: - Monitoring Equipment: Tape measure and calipers QA/QC procedures to be applied: IFC will be carried out by a technical staff with extensive knowledge of the practice of IFC activities, following the standard procedures below: - height positioning of the measurement of diameter of the trunk at 1.30 meters from the ground (eg, buttresses, bifurcations, relief, slope

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of the trunk, lianas, among others);

- identification with red paint on the stem height where it was measured for identification in later remeasurement;

Calculation method: Measurement in situ in PSPs Comments: Application of the parameter in equations 3-10; 3-11; 3-12 in VCS 2011

Data Unit / Parameter: DBHtree_ nd,n,i,snd, j ,t

Data unit: Centimeters Description: Height at breast height of an individual tree (n) of species (i) in the sample plot in a naturally disturbed area (snd), stratum (j), year t Source of data: Measured using measure tape (DBH) Description of measurement methods Validated/verified only when verifying some and procedures to be applied: disturbance Frequency of monitoring/recording: At intervals not exceeding 5 years from the first measurement Value Applied: Minimum of 10 cm of DBH with measurement of all individuals within the PSPs Monitoring Equipment: Diametric or measure tape QA/QC procedures to be applied: IFC will be implemented by a technical staff with extensive knowledge of the practice of IFC activities, following the standard procedures below: - height positioning of the measurement of diameter of the trunk at 1.30 meters from the ground (eg, buttresses, bifurcations, relief, slope of the trunk, lianas, among others);

- identification with red paint on the stem height where it was measured for identification in later remeasurement;

Calculation method: Measurement in the PSPs with proper equipment Comments: Application of the parameter in equations 3-12 in VCS (2011)

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Data Unit / Parameter: And, j ,t

Data unit: Hectares Description: Area of natural disturbance (nd), in stratum j in the year t Source of data: EBCF Description of measurement methods Using evaluation and validation by RS/GIS and procedures to be applied: monitoring and ground truthing Frequency of monitoring/recording: Annual Value Applied: Only after remote sensing and evaluate in the case of some disturbance. Monitoring Equipment: Computational resources, satellite images, and specific softwares. QA/QC procedures to be applied: Validation and evaluation in a GIS environment with the aid of high/medium resolution satellite images. Calculation method: GIS environment Comments: Application of the parameter in equations 4-15; 4-17a in VCS (2011)

Data Unit / Parameter: fnatdisturb, j ,t

Data unit: Non-dimensional Description: Fraction of the naturally damaged forest in stratum j in the year t Source of data: EBCF Description of measurement methods Using RS/GIS monitoring and ground truthing and procedures to be applied: Frequency of monitoring/recording: Annual Value Applied: Only after remote and field-based evaluations Monitoring Equipment: Computational resources and specific software QA/QC procedures to be applied: Measurement in a GIS environment with the help of high/medium resolution satellite images. Calculation method: GIS environment Comments: Application of the parameter in equations 4-16 in VCS (2011)

Data Unit / Parameter: Villegal_ harvest,t

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Data unit: m3 Description: Volume of illegal timber sold as determined in field survey in year t Source of data: EBFC Description of measurement methods Field survey and alternative information and procedures to be applied: Frequency of monitoring/recording: Annual Value Applied: - Monitoring Equipment: Satellite images, computational resources, specific software, and indirect and field observations. QA/QC procedures to be applied: A team in charge of the RPDS surveillance and the remote monitoring will be trained, specialized in geoprocessing technologies Calculation method: Through field verification and collection of preliminary information for subsequent measurement in a GIS environment Comments: Application of the parameter in equations 4-21 in VCS (2011)

Data Unit / Parameter: Aillegal_ harvest,j ,t

Data unit: Hectares Description: Illegal logging area in stratum j in year t Source of data: EBCF Description of measurement methods Use of high/medium resolution satellite images in and procedures to be applied: a GIS environment. Frequency of monitoring/recording: Annual Value Applied: Only when relevant Monitoring Equipment: Satellite images, computational resources and specific software QA/QC procedures to be applied: Visual image interpretation and field verification

Calculation method: Through field verification and collection of preliminary information for subsequent measurement in a GIS environment Comments: Application of the parameter in equations 4-22 in VCS (2011)

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Data Unit / Parameter: Vactual_ harvest,l,t

Data unit: m3 ano-1 Description: Real annual logging volume for land tract I, owned or operated by the proponent of the project or the forest with comparable situations and conditions at the local, regional, or national level in year t. Source of data: EBCF (2013). pre-project disclosure documents Description of measurement methods 100% inventory and licensing. Ex-ante and procedures to be applied: Frequency of monitoring/recording: Annual Value Applied: Varying annually according to the POA Monitoring Equipment: - QA/QC procedures to be applied: EBCF and authorized licensing body.

Calculation method: Following state and federal legislation Comments: Application of the parameter in equations 5-4; 5- 5; 5-6; 5-7; 3-13 in the VCS (2011)

Data Unit / Parameter: As,j,t=0

Data unit: Area in hectares Description: Total area of sampled plots (s) in stratum (j) at time t = 0 Source of data: Allocation and spatial field in the sample plots Description of measurement methods A continuous forest inventory for monitoring the and procedures to be applied: dynamics of carbon stocks will be conducted. And if necessary, in disturbed areas. Frequency of monitoring/recording: At intervals not exceeding 5 years from the first measurement Value Applied: At least thirty (30) portions

Monitoring Equipment: GPS and measuring tape QA/QC procedures to be applied: IFC will be implemented by a technical staff with extensive knowledge of the practice of IFC activities, following the standard procedures below: - ensure measurement and allocation of PSPs is standardized, does not deviate from procedures, and serves mainly to verify the reliability of field activities,

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- use of appropriate measuring equipment and utilities (e.g. tape, GPS navigation, compass, red paint, stakes and others); - marking initial and final vertices of PSPs and internal area of the parcels; - defense of inclination for correct fit for the the size and shape of PSPs - georeferencing of PSP vertices; - demarcation, clearing, and georeferencing of access trails; Calculation method: Literature review for the application of appropriate methodology Comments: Application of the parameter in equations 3-10; 3- 11; 3-12 in VCS 2011

Data Unit / Parameter: And,j,t

Data unit: Hectares Description: Area of natural disturbance (nd), in stratum j in the year t Source of data: Verification and field measurement with the aid of interpretation of satellite images. Description of measurement methods Significant disturbance events in the PA will be and procedures to be applied: examined and evaluated in field Frequency of monitoring/recording: Annual Value Applied: NA (not applicable) Monitoring Equipment: GPS, GIS, Satellite Images, computational resources and specific geoprocessing softwares, automobiles among others QA/QC procedures to be applied: A team in charge of the RPDS surveillance and the remote monitoring will be trained, specialized in geoprocessing technologies Calculation method: GIS Environment and field data Comments: Application of the parameter in equations 4-15; 4-17a in VCS (2011)

Data Unit / Parameter: fnatdisturb,j,t

Data unit: Non-dimensional Description: Fraction of the naturally damaged forest in stratum j in the year t

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Source of data: field data collection Description of measurement methods Proportion of disturbed area and total area of the and procedures to be applied: stratum Frequency of monitoring/recording: Annual Value Applied: NA (not applicable) Monitoring Equipment: GPS, GIS, Satellite Images, computational resources and geoprocessing-specific softwares QA/QC procedures to be applied: A team in charge of the RPDS surveillance and the remote monitoring will be trained, specialized in geoprocessing technologies Calculation method: Quantification with the aid of GIS and field data Comments: Application of the parameter in equations 4-16 in VCS 2011

Measured-only parameters (will not be monitored)

Data Unit / Parameter: Aproject,t =0

Data unit: Hectares

Description: project area at time t=0

Source of data: Field validation using GPS, GIS thematic maps and satellite images

Description of measurement methods Validated/verified before the start date of the and procedures to be applied: IFM-LtPF project

Frequency of monitoring/recording: NA (not applicable)

Value Applied: 19,800 ha

Monitoring Equipment: Computational resources and appropriate software

QA/QC procedures to be applied: Georeferencing following national land standards

Calculation method: Computational resources with appropriate softwares using SAD 1969 datum and metric projection.

Comments: Application of the parameter in equations 2-1;

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3-4; 3-6; 3-9; 3-13; 3-36b em VCS (2011)

Parâmetro Aproject,t =0

Data Unit / Parameter: Aproject,j,t =0

Data unit: Area in hectares Description: Project area within each stratum (j) at time t=0 Source of data: SIPAM/RADAM 2002 Description of Validated/verified before the start date of the IFM-LtPF project measurement methods and procedures to be applied: Frequency of NA (not applicable) monitoring/recording: Value Applied: Area Phytophysiognomy Area (ha) (%)

Primary Tropical Ombrophylous Alluvial Forest (Floresta Ombrófila 3043.22 15% Densa Aluvial de Dossel emergente)

Primary Tropical Ombrophylous Lowland Forest (Floresta Ombrófila 16615.02 84% Densa Terras Baixas Dossel Emergente)

Pioneer forest types with fluvial and/or lacustrine influence – 141.75 1% herbaceous

19800.00 100%

Monitoring Computational resources and appropriate software Equipment: QA/QC procedures to A team in charge of the RPDS surveillance and the remote be applied: monitoring will be trained, specialized in geoprocessing technologies Calculation method: Stratification of the PA was conducted using a thematic map of SIPAM/RADAM 2002 vegetation types where the PA was extracted. Procedure in a GIS environment Comments: Application of the parameter in equations 2-1; 3-4; 3-6; 3-9; 3-13 in VCS (2011)

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Data Unit / Parameter: ANHA _ annual,t

Data unit: Hectares

Description: Net logged area for the project area in year t

Source of data: Obtained from the Corporate Sustainable Management Plan. Spatial delimitation of Annual Production Units (UPA)

Description of measurement methods Validated/verified before the start date of the and procedures to be applied: IFM-LtPF project

Frequency of monitoring/recording: Variation by year

Value Applied: According to the Environmental Licensing Annual Operating Plan

Monitoring Equipment: NA (not applicable)

QA/QC procedures to be applied: Application of the parameter in equations 3- 15a;3-16a; 3-26; 3-27; 3-33; 3-35; 3-37a; 3-38 in VCS (2011)

Calculation method:

Comments:

Data Unit / Parameter: Vhistorical_harvest,l,k

Data Unit: Volume in cubic meters (m3)

Description: Total volume of harvest for the land (l), which is owned and/or operated by the proponent of the project during the historical reference period

Source of Data: Proponent project records through licensing of the Annual Operating Plan (AOP). Only ex ante information

Description of measurement methods Validated/verified before the start date of the

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and procedures to be applied: IFM-LtPF project

Frequency of monitoring/recording: NA (not applicable)

Value Applied: 184.939,01 m3

Monitoring Equipment: NA (not applicable)

QA/QC procedures to be applied: Pre-project historical record

Calculation method: Pre-project historical record

Comments: Application of the parameter in the equations 5-3 in VCS (2011)

5.3 Data and Parameters to Be Monitored

Data Unit / Parameter: Deforestation

Data unit: Hectare Description: Conversion of forest-use areas to other uses Source of data: Primary surveillance data under EBCF’s responsibility and secondary data (Prodes, SAD, DETER and others). Description of measurement methods Collection and evaluation of field data, various and procedures to be applied: geoprocessing and remote sensing routines and procedures such as: pre-processing of satellite images (geometric and radiometric corrections) and subsequent automatic classification and visual interpretation of temporal series of satellite images over a period of interest and comparison with auxiliary data. Frequency of monitoring/recording: Early Value Applied: Ex-post evaluation Monitoring Equipment: GPS, GIS, Satellite Images, computational resources, specific geoprocessing softwares, automobiles, among others QA/QC procedures to be applied: A team in charge of the RPDS surveillance and the remote monitoring will be trained, specialized in geoprocessing technologies Calculation method: Geographic Information System (GIS) Environment

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Comments:

Data Unit / Parameter: Forest degradation

Data unit: Hectare Description: Remote detection of forest degradation activities (eg, unlawful selective exploitation) Source of data: Primary and secondary data (DEGRAD, Deter, PROARCO, complaints, among others) Description of measurement methods Collection and evaluation of field data, various and procedures to be applied: geoprocessing and remote sensing routines and procedures such as: pre-processing of satellite images (geometric and radiometric corrections) and subsequent automatic classification and visual interpretation of temporal series of satellite images over a period of interest and comparison with auxiliary data. Frequency of monitoring/recording: Early Value Applied: Ex-post evaluation Monitoring Equipment: GPS, GIS, Satellite Images, computational resources and specific geoprocessing softwares, automobiles among others QA/QC procedures to be applied: A team in charge of the RPDS surveillance and the remote monitoring will be trained, specialized in geoprocessing technologies Calculation method: Geographic Information System (GIS) Environment Comments:

Data Unit / Parameter: hotspots and fires/wildfires

Data unit: Locations (points) and surrounding areas Description: Remote detection of forest degradation activities (eg, selective exploitation without the adequate legal protection) Source of data: Primary and secondary data (DEGRAD, Deter, PROARCO, complaints, among others) Description of measurement methods Collection and evaluation and validation of field and procedures to be applied: data, and various procedures and geoprocessing routines Frequency of monitoring/recording: Early

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Value Applied: Ex-post evaluation Monitoring Equipment: GPS, GIS, Satellite Images, computational resources and specific geoprocessing softwares, automobiles among others QA/QC procedures to be applied: A team in charge of the RPDS surveillance and the remote monitoring will be trained, specialized in geoprocessing technologies Calculation method: Geographic Information System (GIS) Environment Comments:

Data Unit / Parameter: natural disturbances

Data unit: Area in hectares Description: Remote sensing of natural disturbances affecting the biomass stock of PA (e.g. blowdown, severe weather events, pest attacks, diseases etc.) Source of data: Primary and secondary data (satellite images, complaints, among others). In the event of significant natural disturbances in the PA is also hosting an IFC to quantify biomass loss as well as the dynamic growth and regeneration of the area, using the same sampling IFC methodology in forested areas. Description of measurement methods Collection and evaluation and validation of field and procedures to be applied: data, and various procedures and geoprocessing routines. Frequency of monitoring/recording: Annual Value Applied: Ex-post evaluation Monitoring Equipment: GPS, GIS, Satellite Images, computational resources and specific geoprocessing softwares, automobiles among others QA/QC procedures to be applied: A team in charge of the RPDS surveillance and the remote monitoring will be trained, specialized in geoprocessing technologies Calculation method: Geographic Information System (GIS) Environment Comments:

Data Unit / Parameter: Stock of woody biomass (ABG)

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Data unit: biomass tonnage/hectare Description: GIS, SR and forest inventory - Measuring PSP Source of data: Source: Satellite images + data re-measured fields Description of measurement methods By lot, define the parcels to be monitored; and procedures to be applied: remeasure the trees sampled in the plots Frequency of monitoring/recording: At intervals not exceeding 5 years from the first measurement Value Applied: 248.4 ton/ha (+-11,2) Monitoring Equipment: Computational resources and appropriate software QA/QC procedures to be applied: Literature review based upon robust scientific work Calculation method: GIS environment and estimated average stratified Comments: Application of the parameter in equations 3-8; 3- 9; 3-14; 3-7; 3-13 in the VCS (2011)

Parameters only measured and reviewed in the literature (will not be monitored and only updated when relevant)

Data Unit / Parameter: CFWood

Data unit: tC (t d.m.)-1 Description: Carbon fraction of wood in the tropical forest Source of data: VCS (2011) Description of measurement methods Literature review to the appropriate value during and procedures to be applied: the monitoring event Value Applied: 0.49 Comments: Application of the parameter in equations 3-3; 3- 5; 3-41; 3-51; 3-13 in the VCS (2011)

Data Unit / Parameter: CFAGB

Data unit: tC (t d.m.)-1 Description: Carbon fraction in above-ground biomass of rainforest trees Source of data: VCS (2011) Description of measurement methods Literature review to the appropriate value during

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and procedures to be applied: the monitoring event Value Applied: 0.47 Comments: Application of the parameter in equations 3-8; 3- 14; 3-37a; 3-37b; 3-38; 4-15; 4-17a; 4-21; 4-22; 5-8; 5-9 in (VCS, 2011)

Parameter D

Unit (t d.m.) m-3 Description Wood density for tropical forest with corresponding climate and ecological zone Source of data: VCS (2011) Measurement methods and procedures Literature review and, where necessary, verify or to be applied: obtain the local value Value to be applied: 0.6 Comments: Application of the parameter in equations 3-3; 3- 5; 3-41; 3-51; 4-21; 5-8; 5-9 in (VCS, 2011)

Data Unit / Parameter: fV(DBHn,i,s, j,t=0,Hn,i,s, j,t=0 )

Data unit: Non-dimensional Description: Allometric equation of volume as a function of diameter at breast height and height; t = 0 years Source of data: Adjusted based on regression analysis with the site itself sampled data Description of measurement methods Literature review and, where necessary, verify or and procedures to be applied: obtain the local value Value Applied: Not applicable Comments: Application of the parameter in the equations 3- 10; 3-11 in (VCS, 2011)

Data Unit / Parameter: fB (DBHn,i,s, j,t=0,Hn,s,i, j,t=0,Di )

Data unit: Non-dimensional Description: Allometric equation of biomass as a function of diameter at breast height and height; t = 0 years Source of data: Obtained from the literature. Description of measurement methods Literature review and, where necessary, verify or

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and procedures to be applied: obtain the local value Value Applied: To be provided by HDOM before validation Comments: Application of the parameter in equations 3-12 in (VCS, 2011)

Data Unit / Parameter: kdecay

Data unit: yr-1 Description: Dead wood storage yearly decomposition rate Source of data: Chamberset al. (2000) Description of measurement methods Literature review to the appropriate value during and procedures to be applied: the monitoring event Value Applied: 0.167

Comments: Application of the parameter in the equations 3- 17; 3-21 in (VCS, 2011)

Data Unit / Parameter: fRSD

Data unit: Non-dimensional Description: Damage factor to the remaining forest, based on the fraction of the carbon resulting from the damage to the remaining forest by the amount of carbon in the marketable logs extracted. Source of data: Feldpauschet al. (2005) Description of measurement methods Literature review to the appropriate value during and procedures to be applied: the monitoring event Value Applied: 2.4 Comments: Application of the parameter in equations 3-19; 4-21; 5-8, 5-9 in (VCS, 2011)

Data Unit / Parameter: fbranch _ trim

Data unit: Non-dimensional Description: Fraction of branches and remaining chips in the above-ground biomass after logging the marketable timber and transferring it to the dead wood storage. Source of data: Keller et al. (2004)

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Description of measurement methods Literature review and, where necessary, verify or and procedures to be applied: obtain the local value Value Applied: 0.67 Comments: Application of the parameter in equations 3-20 in (VCS, 2011)

Data Unit / Parameter: flumber_recovery

Data unit: Non-dimensional Description: Lumber recovery factor for the proportion of marketable logs converted into harvested wood products. Source of data: Veríssimo (1992) apud VCS (2011) Description of measurement methods Literature review to the appropriate value during and procedures to be applied: the monitoring event Value Applied: 0.47 Comments: Application of the parameter in equations 3-26; 3-27 in (VCS, 2011)

Data Unit / Parameter: kltHWP_ ox

Data unit: yr-1 Description: Yearly oxidation rate for long-term harvested wood products. Source of data: IPCC (2006) apud VCS (2011) Description of measurement methods Literature review to the appropriate value during and procedures to be applied: the monitoring event Value Applied: 0.023 Comments: Application of the parameter in equations 3-28 in (VCS, 2011)

Data Unit / Parameter: Gregrowth, t

Data unit: (t d.m.) ha-1 yr-1

Description: Average regeneration per hectare per year of above-ground biomass after selective logging per year t, in t.d.m./ha/year. Source of data: Mazzeiet al. (2010) Description of measurement methods Literature review to the appropriate value during

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and procedures to be applied: the monitoring event Value Applied: 2.6 Comments: Application of the parameter in equations 3-38 in (VCS, 2011)

Data Unit / Parameter: EFfuel - Gasolina

-1 Data unit: tCO2e kL

Description: Emission of fuels factor Source of data: IPCC (2006) Description of measurement methods Literature review to the appropriate value during and procedures to be applied: the monitoring event Value Applied: 2.395 Comments: Application of the parameter in equations 3-40; 3-42; 3-43; 3-46; 3-50; 3-54; 4-8; 4-11; 4-14 in (VCS, 2011)

Data Unit / Parameter: EFfuel - Diesel

-1 Data unit: tCO2e kL

Description: Emission of fuels factor Source of data: IPCC (2006) Description of measurement methods Literature review to the appropriate value during and procedures to be applied: the monitoring event Value Applied: 3.013 Comments: Application of the parameter in equations 3-40; 3-42; 3-43; 3-46; 3-50; 3-54; 4-8; 4-11; 4-14 in (VCS, 2011)

Data Unit / Parameter: FCharvest - Gasoline

Data unit: kL m-3 Description: Fuel consumption of the equipment used to cut and drag per m3 of merchantable timber harvested Source of data: Living Amazon Forest Description of measurement methods Literature review to the appropriate value during and procedures to be applied: the monitoring event Value Applied: 0.01

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Comments: Application of the parameter in the equations 3- 40 in (VCS, 2011)

Data Unit / Parameter: FCharvest - Diesel

Data unit: kL m-3 Description: Fuel consumption of the equipment used to cut and drag per m3 of merchantable timber harvested Source of data: Living Amazon Forest Description of measurement methods Literature review to the appropriate value during and procedures to be applied: the monitoring event Value Applied: 0.05 Comments: Application of the parameter in the equations 3- 40 in (VCS, 2011)

Data Unit / Parameter: CAPtruck Carreta

Data unit: m3 truck-1

Description: Truck load capacity Source of data: EBCF (2013) Description of measurement methods Literature review to the appropriate value during and procedures to be applied: the monitoring event Value Applied: 30 Comments: Application of the parameter in the equations 3- 44; 3-52 in (VCS, 2011)

Data Unit / Parameter: CAPtruck Balsa

Data unit: m3 truck-1

Description: Truck load capacity Source of data: EBCF (2013) Description of measurement methods Literature review to the appropriate value during and procedures to be applied: the monitoring event Value Applied: 500 Comments: Application of the parameter in the equations 3- 44; 3-52 in (VCS, 2011)

Data Unit / Parameter: Eff_vehicle Balsa

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Data unit: km kL-1 Description: Fuel efficiency in each type of vehicle Source of data: Barros &Uhl (1997) Description of measurement methods Literature review to the appropriate value during and procedures to be applied: the monitoring event Value Applied: 3770 Comments: Application of the parameter in equations 3-46; 3-52; 3-54; 4-7; 4-11; 4-14 em (VCS, 2011)

Data Unit / Parameter: Eff_vehicle Carreta

Data unit: km kL-1 Description: Fuel efficiency in each type of vehicle Source of data: Barros &Uhl (1997) Description of measurement methods Literature review to the appropriate value during and procedures to be applied: the monitoring event Value Applied: 2000 Comments:

Application of the parameter in equations 3-46; 3-52; 3-54; 4-7; 4-11; 4-14 em (VCS, 2011)

Data Unit / Parameter: edemand

Data unit: kWh m-3 Description: Power demand for processing volume processed Source of data: VSS (2011) Description of measurement methods Literature review to the appropriate value during and procedures to be applied: the monitoring event Value Applied: 20 Comments: Application of the parameter in equations 3-47 in (VCS, 2011)

Data Unit / Parameter: EFelectricity

-1 Data unit: tCO2e kWh Description: Power emission factor in the country of origin Source of data: IEA (2011) and MCT (2013) Description of measurement methods Annual review of specific value and procedures to be applied: Value Applied: 0.000088 (2000), 0.000079 (2003), 0.00003223

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(2006), 0.0000293 (2008) Comments: Application of the parameter in the equations 3- 48; 4-4 in (VCS, 2011)

Data Unit / Parameter: EFflight,y

-1 Data unit: tCO2e (passenger.km) Description: Emission factor of the flight for travel y Source of data: Value from the literature Description of measurement methods Annual review of specific value and procedures to be applied: Value Applied: 0.00026 - Domestic

0.00036 – Short

0.0002 – Medium

0.00023 –Long

Comments: Application of the parameter in equations 4-6, 4-10; 4-13 in (VCS, 2011)

Data Unit / Parameter: Vhistorical_ harvest,l,k

Data unit: m3 Description: Total volume of harvest for the land (l), which is owned and/or operated by the proponent of the project during the historical reference period Source of data: Records and licensing documents of project proponent, Operating License (OL) and Explorantion Authorizations (AUTEFs). Description of measurement methods Validated/verified before the start date of the IFM- and procedures to be applied: LtPF project Frequency of monitoring/recording: - Value Applied: - Monitoring Equipment: Values of environmental licensing shown in the AUTEXs. Pre-project historical records QA/QC procedures to be applied: -

Calculation method: Sum of all annual AUTEXs Comments: Application of the parameter in the equations 5-3 in VCS (2011)

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Monitored parameters of flora

Data Unit / Parameter: Floristic and phytosociological structure of the tree community

Data unit: Non-dimensional Description: IFC PSPs will be checked for incidence of entry and mortality and also for what type(s) of vegetable stand out, as well as the dynamics of growth and increase/decrease of biomass Source of data: Primary data obtained by EBCF on the field with measurements by PSPs Description of measurement methods Activities complementary to the remeasurement and procedures to be applied: of the IFC, in order to know more about the dynamics, density, dominance and basal area of the species found. Temporal comparisons with previous phytosociological parameters, especially for species of highest and lowest values of Importance Value Index (IVI) and Coverage Value Index (IVC). Moreover, the red list of endangered and vulnerable species (SEMA, CITES, IUCN and MMA) should be permanently updated through regular consultations. Frequency of monitoring/recording: At intervals not exceeding 5 years from the first measurement Monitoring Equipment: Tape-measure, GPS, field spreadsheet, automobile, computer, first aid kit

Data Unit / Parameter: Extraction of non-timber forest products

Data unit: Quantity of differentiated products and weight in kilogram Description: A form containing the descriptions of the variety and quality of non-timber forest products extracted, their volumes, weights and use (family benefit and/or sale) will be completed during the community monitors interviews with the families using the natural resources in the project areas. Source of data: Primary data collected by the community monitors through the spreadsheet given by EBCF

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Description of measurement methods It is recommended that 2 monitors be trained in and procedures to be applied: each community for the interviews with the families which fish for survival and/or trade within the project areas. The primary data collected must be made available to the EBCF team, which will tabulate such data, making qualitative and quantitative analyzes. Frequency of monitoring/recording: Community monitors should have the full information registered twice a year, with the first survey during the summer period (between the months of May to October) and the second, in the winter period (November-April). Monitoring Equipment: Tape-measure, GPS, field spreadsheet, computer, first aid kit and camera.

Data Unit / Parameter: Herbaceous shrub layer phytosociology

Data unit: Phytosociological parameters of tree species (using the same parameters presented in this report) Description: Permanent partitions will be checked for incidence of entry and mortality and also for what type(s) of vegetable stand out, as well as the dynamics of growth and increase/decrease of biomass Source of data: Primary data obtained by EBCF on the field with measurements by PSPs Description of measurement methods Models of 1X1 meter partitions within PSPs are and procedures to be applied: advisable. It is also recommended to allocate these parts continuously/ juxtaposed or overlapping IFC parts in order to facilitate field logistics, optimizing financial resources. Moreover, the red list of endangered and vulnerable species (SEMA, CITES, IUCN and MMA) should be permanently updated through regular consultations Frequency of monitoring/recording: At intervals not exceeding 5 years from the first measurement Monitoring Equipment: Tape-measure, GPS, field spreadsheet, automobile, computer, first aid kit

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Data Unit / Parameter: Evaluation of the use of plant products for internal consumption

Data unit: Unit / Family / Time Description: Quantification and qualification of demand of plant products such as roundwood, lumber, NTFPs, vines, palm trees and other forest benefits per family Source of data: Primary data obtained from EBCF field visits of local communities Description of measurement methods Participatory rural diagnosis through informal and procedures to be applied: conversations and semi-structured questionnaires with the community Frequency of monitoring/recording: Annual Monitoring Equipment: Car for transportation, smartphones, computer and other

Monitored parameters of fauna

Data Unit / Parameter: Medium and large mammals

Data unit: Number of types Description: Diversity of medium and large mammal species Source of data: Biological inventory in the field Description of measurement methods View of animals via line transects and tracking and procedures to be applied: traces in sampling points, complemented by indirect data from feces and hair, as well as interviews with locals about the species present in the area and on their use of wildlife. The line transect method is standard for systematic inventories of diurnal mammals in the Amazon and other tropical forests. The procedure consists of carefully navigating a straight track - the transect - at an even pace, recording all encounters with the relevant species. At each meeting (sighting) with individuals or groups of target species, you should record: time, location on the track, species, number of individuals and their sex- age classes, animal-track perpendicular distance, observed behavior of the animal, height from the ground and other relevant information, such as the food item being consumed. In the case of a group, the data

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should refer to the first animal sighted. Before starting the course, the date, sample point, observers, weather and start time are recorded. Finally, closing time should also be noted Frequency of monitoring/recording: Biological inventories, including that of mammals, should be repeated at an interval not exceeding 5 years from the first measurement. Value Applied: - Monitoring Equipment: Measuring tape, binoculars, cameras, plastic gloves, magnifying glasses and plastic bags to collect stool and, as well as forms for the interviews. QA/QC procedures to be applied: The inventory will be conducted by a specialized crew with vast knowledge in the quick inventory of mammals.

Calculation method: - Comments: Species whose adult weight equals to or is less than one kg will be considered medium and large mammals. The specialized staff to be hired should participate in joint expeditions with other teams of experts in order to identify other animal of interest.

Data Unit / Parameter: Mammals: Chiroptera (bats)

Data unit: Number of types Description: Diversity of bat species Source of data: Biological inventory in the field Description of measurement methods The main methodologies used for sampling bats and procedures to be applied: will be based on (1) trapping of animals mid- flight with the aid of mist nets and (2) diurnal search and capture in quarries, using nets and hand nets. Samplings will be directed to several types and subtypes of vegetation associated with these, but especially mosaics. Types and subtypes of vegetation should be diagnosed previously by plant teams and landscape studies on the relevant region. Frequency of monitoring/recording: Biological inventories, including that of chiroptera, should be repeated at an interval not

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exceeding 5 years from the first measurement. Value Applied: - Monitoring Equipment: Tape, mist nets, hand nets, camera, leather gloves, magnifying glass and plastic bags to collect fur and feces QA/QC procedures to be applied: The inventory will be conducted by a specialized crew with vast knowledge in the quick inventory of bats.

Calculation method: - Comments: Species whose adult weight equals to or is less than one kg will be considered medium and large mammals. The specialized staff to be hired should participate in joint expeditions with other teams of experts in order to identify other animals of interest.

Data Unit / Parameter: Bird inventory

Data unit: Number of types Description: Diversity of bird species Source of data: Biological inventory in the field Description of measurement methods View and sound recording of animals via line and procedures to be applied: transect, carefully traversing a straight track - the transect - at an even pace, recording all encounters with the relevant species. At each meeting (sighting) with individuals or groups of target species, you should record: time, location on the track, species, number of individuals and their sex-age classes, animal-track perpendicular distance, observed behavior of the animal, height from the ground and other relevant information, such as the food item being consumed. Before starting the course, the date, sample point, observers, weather and start time are recorded. Finally, closing time should also be noted The methods of visual and sound recording will be used together to survey the bird species of the localities. Where possible, bird vocalizations will be

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recorded with the aid of an ultra-directional analog or digital recorder. Prior to the field visit, one should proceed with literature searches as aid in order to identify birds in the field, as well as to gather information on the geographical distribution of the species marked for the region. Frequency of monitoring/recording: Bird inventories should occur every 5 years. Value Applied: - Monitoring Equipment: Binoculars, audio recorder, camera, and record spreadsheets. QA/QC procedures to be applied: The inventory will be conducted by a specialized crew with vast knowledge in the quick inventory of birds.

Calculation method: - Comments: The specialized staff to be hired should participate in joint expeditions with other teams of experts in order to identify other animals of interest.

Data Unit / Parameter: Fish Species

Data unit: Number of species Description: Diversity of fish species and groupings in lakes, streams and rivers. Source of data: Biological inventory in the field Description of measurement Methodology based on the protocol for research on methods and procedures to be fish in RAPELD modules of the PPBio, in grids. applied: RAPELD grids and modules are permanently standardized, 5 km long systems of partitions and trails, spaced 1 km apart. The trails are marked with a picket every 50 meters with the track name and distance along the trail. Aquatic partitions are used for the biological inventory of fish. Each plot corresponds to a stretch of 50m in length following the bed of the creek, stream, river and the measurement is taken by the bank, towards the mouth bedside. Frequency of monitoring/recording: Preferably performed in the same seasonal period. Value Applied: - Monitoring Equipment: 50m tape measure; ½ inch PVC pipes (100 cm long, 8 to 10 units); colored plastic ribbons (easily seen in the vegetation); fine mesh (1 mm) hand nets; small dragnet; formaldehyde 37%; alcohol 96

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GL; 90g tracing paper labels; indelible pen or ink; resistant plastic bags; rubber bands. QA/QC procedures to be applied: The inventory will be conducted by a specialized crew with vast knowledge in the quick inventory of ichthyofauna. Calculation method: - Comments: For further details, see: http://ppbio.inpa.gov.br/sites/default/files/Peixes.pdf

Data Unit / Parameter: Reptiles

Data unit: Number of species of amphibians and reptiles. Description: Sampling plots and identification of species diversity in the project area. Source of data: Biological inventory of the field. Description of measurement 2 methods will be employed: i) Pitfall traps with methods and procedures to be drift-fence and ii) Visual Encounter Surveys, applied: CRUMP; SCOTT, 1994).

Method I) Standardized sampling, appropriate to the collection of frogs, reptiles, mammals and many invertebrates of the litterfall. Provides quantitative data that can be compared across different areas, given that the size of buckets, the distance between them and the design of the traps are the same. At each sampling point are used four 60 liter buckets, arranged in a Y shape, with the central bucket 10 m away from each of the three peripheral buckets. Each peripheral bucket is connected with the central one by a plastic sheet of 50 cm in height, with its lower end buried in the ground. The three sheets form an angle of 120° with each other (JONES, 1981; GIBBONS; SEMLITSCH, 1981; CORN, 1994; RIBEIRO- JUNIOR et al., 2008). During the sampling period, the buckets should be inspected daily in order to collect the stranded animals. Between the sampling periods, the buckets should be closed or twigs should be placed in the buckets in order to allow an exit for animals who might fall in. The second option is usually more efficient, depending on how hard it is to close the buckets.

Method II) The method consists of slowly walking along the grid of trails. On each side of the track, an area of 5 meters is sampled to a depth of 3 to 4 meters. The litterfall, decaying trunks, trunk cavities, vegetation within holes in the ground, and other places that can provide shelter for reptiles are surveyed. Time and place are registered for the

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animals sighted or heard, but not collected, whose identification is secure. This method requires at least 100 hours of research time. Frequency of monitoring/recording: Preferably performed in the same seasonal period. Value Applied: - Monitoring Equipment: Pitfall traps, binoculars, microphone for recording vocalization, plastic buckets of 40 and 100 liters.

QA/QC procedures to be applied: The inventory will be conducted by a specialized crew with vast knowledge in the quick inventory of reptiles. Calculation method: - Comments: For further details, see: http://ppbio.museu- goeldi.br/?q=pt-br/protocolo-10-herpetofauna

Data Unit / Parameter: Anurans (amphibians)

Data unit: Number of species (richness) Description: Diversity of anuran species Source of data: Biological inventory in the field Description of measurement methods In order to identify anura, you should use the and procedures to be applied: RAPELD methodology with grids and modules on standardized permanent trails and plots systems. The rows represent trails, which are usually 5 km long and 1 km apart from each other, with evenly distributed plots. It is advisable to perform at least two surveys, one at the peak of the rainy season and another at the end of the rainy season. This allows species with short and restricted breeding seasons to one of these periods to be detected. Before starting field activities, it is important to collect as much information on species occurring in the study area as possible, using photos and sound files available on the Internet or in specialized literature for mounting boards and collections of reference sounds. The material obtained should be used to start a collection of references, associating photos of individuals of each species and their vocalizations. Photos and sonograms (visual representations of vocalizations) can be

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arranged on boards of images that can be taken to the field by observers, assisting in the identification of species.

Frequency of monitoring/recording: Biological inventories, including that of Anurans, should be repeated at an interval not exceeding 5 years from the first measurement. Value Applied: - Monitoring Equipment: Camera; digital recorder; transparent (5 L) plastic bags used to transport animals collected on the field; adequate thermometer for measuring air temperature; wristwatch; permanent markers; pencil and eraser; clipboards for annotations; head flashlight head; and GPS. QA/QC procedures to be applied: The inventory will be conducted by a specialized crew with vast knowledge in the quick inventory of anuran species.

Calculation method: - Comments: If the precise identification of the species via sonogram is not possible, naming morphotypes is sufficient. You can use the name of the genus or family of each species, followed by the epithet "sp." More accurate identifications can be made later by specialists in the group. The specialized staff to be hired should participate in joint expeditions with other teams of experts in order to identify other animals of interest.

Data Unit / Parameter: Subsistence and/or commercial fishing

Data unit: Number of captured species (common name) and fish weight (in kg) Description: In interviews with community monitors and families that use the natural resources in the project areas, forms will be filled out containing the descriptions of the species and weights of fish caught in lakes, streams and rivers of the project areas and the surrounding region (buffer)

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Source of data: Primary data collected by the community monitors through the spreadsheet given by EBCF Description of measurement methods It is recommended that 2 monitors be trained in and procedures to be applied: each community for the interviews with the families which fish for survival and/or trade within the project areas. The primary data collected must be made available to the EBCF team, which will tabulate such data, making qualitative and quantitative analyzes. Frequency of monitoring/recording: Community monitors should have the full information registered twice a year, with the first survey during the summer period (between the months of May to October) and the second, in the winter period (November-April). Value Applied: Tape-measure, GPS, field spreadsheet, computer, first aid kit and camera. Monitoring Equipment: QA/QC procedures to be applied: Calculation method: Comments:

Data Unit / Parameter: Subsistence and/or commercial hunting

Data unit: Number of hunted species (common name), number of individuals hunted by species and animal weight (in kg) Description: In interviews with community monitors and families that use the natural resources in the project areas, forms will be filled out containing the descriptions of the animals and their respective weights, indicating which locations were hunted and the average frequency of hunting.

Source of data: Primary data collected by the community monitors through the spreadsheet given by EBCF Description of measurement methods It is recommended that 2 monitors be trained in and procedures to be applied: each community for the interviews with the

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families which fish for survival and/or trade within the project areas. The primary data collected must be made available to the EBCF team, which will tabulate such data, making qualitative and quantitative analyzes. Frequency of monitoring/recording: Community monitors should have the full information registered twice a year, with the first survey during the summer period (between the months of May to October) and the second, in the winter period (November-April). Value Applied: Tape-measure, GPS, field spreadsheet, computer, first aid kit and camera. Monitoring Equipment: QA/QC procedures to be applied: Calculation method: Comments:

Data Unit / Parameter: Synergistic animals, flagged, threatened or under conflict

Data unit: Number of species (common name) sighted and recorded in audio and/or video. Description: Community monitors will be trained to promote the monitoring of animal species of ecological interest (endangered, of interest to tourisism, under pressure from residents' use (hunting and fishing)). Specific tracks will be defined in various localities that provide access the PA lands. Each trail will be measured.

Source of data: Primary data collected by the community monitors through the spreadsheet given by EBCF Description of measurement methods The main settlements and access trails to the and procedures to be applied: project areas of interest for monitoring should be identified. Trained community monitors should traverse such tracks with defined frequencies to observe and record animals, to be defined by EBCF.

Frequency of monitoring/recording: To be defined in training workshops promoted

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by the EBCF and community monitors, according to the species to be monitored. Value Applied: Binoculars, GPS, field worksheet, computer, first aid, camera and audio recorder. Monitoring Equipment: QA/QC procedures to be applied: Calculation method: Comments:

SOCIAL PARAMETERS MONITORED

Data Unit / Parameter: Land Use

Data unit: Number of production units and management Description: All production and management units of both private and public use, including plantations, ranches, monoculture or intercropped acai plantations, extractivist areas, lakes etc. will be quantified. Source of data: Participatory mapping of the Management Plan and primary data to be obtained in the field by EBCF Description of measurement methods Refinement of participatory maps from the and procedures to be applied: interpretation of high resolution satellite images and field visit to production and management units in each community. Frequency of monitoring/recording: Every three years Monitoring Equipment: GPS, measuring tapes, satellite images

Data Unit / Parameter: Agricultural, forest and fish production

Data unit: Bags, kilos, tons, liters, hectoliters produced Description: The production of annual and biennial crops such as corn, beans, cassava, fish, as well as non-timber products such as, Andiroba, among other nuts, copaiba will be quantified. Source of data: Primary data to be obtained in the field by EBCF. Description of measurement methods Data will be collected from the plots and in the

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and procedures to be applied: extractivist areas of some families in the community as well as in lakes and rivers. Frequency of monitoring/recording: Every year or season, depending on the product Monitoring Equipment: Scales and other appropriate equipment

Data Unit / Parameter: Technological Level

Data unit: Description Description: Technological, management and restoration of employees in production units and approved management plans and implementation systems. Established and implemented fishing rules

Source of data: Primary data to be obtained in the field by EBCF. Description of measurement methods Field visits to production and management units and procedures to be applied: to analyze some indicators such as number of cultivated and/or managed species, cultivation techniques employed and/or management, such as intercropping systems and crop rotation, use of organic fertilizers and green, use of mulch, etc. Frequency of monitoring/recording: Every three years Monitoring Equipment: Field notebooks

Data Unit / Parameter: Social Organization

Data unit: Number of events, associations and community groups. Number and quality of documentation produced, decision making and lessons learned. Number of partnerships and cooperative systems established with other groups and institutions. Description: Quantitative and qualitative characterization of the level of organization of communities, including the ability to establish partnerships and dealing with conflicts Source of data: Analysis of documents and interviews with the leadership. Description of measurement methods Quantification and functional description of each and procedures to be applied: event and/or institution. Participation by gender

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and age. The capacity of the institutions and groups to develop plans, business plans, reports etc. will also be examined. Existence of approved and ongoing projects and funding. Frequency of monitoring/recording: Every year Monitoring Equipment: Field notebooks and recorders, when allowed

Data Unit / Parameter: Demography

Data unit: Number of people Description: Number of male and female population by age group Source of data: Primary data to be obtained in the field by EBCF. Description of measurement methods Update of the demographic data of the and procedures to be applied: Management Plan through home visits Frequency of monitoring/recording: Every five years Monitoring Equipment: Forms

Data Unit / Parameter: Revenue Generation

Data unit: Quantity, volume and diversity of traded products

Description: All traded products will be quantified. Techniques to add value to products, storage system, marketing strategies, transportation used, and the markets involved will also be identified.

Source of data: Existing documents and primary data to be obtained by EBCF.

Description of measurement methods Interviews with leaders and visits to storage and and procedures to be applied: marketing places.

Frequency of monitoring/recording: Every five years

Monitoring Equipment: Scales and other appropriate equipment

Data Unit / Parameter: Installed infrastructure and equipment

Data unit: Amount, type and status of the installed

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infrastructure and equipment

Description: Identifying the description of the conditions of use and maintenance of the installed infrastructure and equipment such as boats, ambulance boats, schools, libraries, warehouses, sheds, community centers, community kitchens, wells, satellite dishes, computers, amateur radio, telephones, internet, electrical network, etc.

Source of data: Primary data to be obtained by EBCF.

Description of measurement methods Field visits to communities and procedures to be applied: Frequency of monitoring/recording: Every three years

Monitoring Equipment: Cameras and field books

Data Unit / Parameter: Health and sanitation

Data unit: Identification of the most frequent diseases; description of the state of health of the local population, infrastructure and community health equipment; water supply, sewage and residue systems

Description: Survey on the incidence of disease and malnutrition; existence of programs and preventive health initiatives, sanitation and redemption of traditional herbal medicines; existence and training of health workers

Source of data: Primary data to be obtained by EBCF.

Description of measurement methods Interviews and questionnaires and procedures to be applied: Frequency of monitoring/recording: Every three years

Monitoring Equipment: Forms and field books

Data Unit / Parameter: Education

Data unit: No. of infrastructure and equipment; no. of teachers and qualification of the educational system

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Description: Raising the educational level of the population by age and gender and qualitative description of the education system in communities, including educational and informational materials and equipment; school transport and teacher training

Source of data: Analysis of existing documents and obtaining primary data by EBCF

Description of measurement methods Updating information of the Management Plan; and procedures to be applied: interviews with teachers, leaders and students.

Frequency of monitoring/recording: Every three years

Monitoring Equipment: Forms and field books

6 MEASUREMENT OF GHG EMISSIONS REDUCTIONS AND REMOVALS (CLIMATE)

6.1 Emissions Baseline

EBCF did not carry out any wood related exploration activity in the areas since the beginning of the REDD+ project. Thus, it is confirmed estimated emission reductions for the project as 86,788.33 t CO2.eq t / year.

6.2 Project emissions

Project emissions were primarily those related to the running of offices and necessary travels for studies, meetings, presentations, workshops and other activities. Table 10 presents a summary of emissions based on data from Annex 21 of this report.

Table 11. 2011-2016 Project Activity Emissions Energy Energy Travels Travels Total YEAR (KWh) (t CO2eq) (Km) (t CO2.eq) (t CO2.eq)

2010 678 0,24 0,24 2011 104.010 23,60 23,60 2012 1.149 0.08 55.724 15,73 15,81 2013 2.756 0.28 236.749 54,29 54,57 2014 2.498 0.25 15.789 4,59 4,84 2015 2.231 0.23 27.340 5,97 6,20 2016 1.015 0.10 0,10 0.93 440.290 104,43 105,36

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6.3 Leakage

Not applicable according to presentation made on the REDD+ IFM document.

6.4 Summary of GHG Emission Reductions and Removals

EBCF REDD+ project shows emissions reduction of 343,975.63 tCO2e as the balance in the period of 2011-2015. Table 12 shows the overview of the dynamics of reductions and project emissions up to 2048. By the year 2015 the emissions data is posted as seen in reports and from 2016 data are projects as previous average and should be adjusted as a result of future reports.

Table 12. Summary of ex ante estimates

Estimated Net GHG Project Unplanned reductions Estimated Estimated estimate Year from emissions emissions 58 Emissions59 baseline57 Reduction tCO2e) (tCO2e) (tCO2e) (tCO2e)

2012 86,755.00 15.81 0 86,739.19

2013 86,755.00 54.57 0 86,700.43

2014 86,755.00 4.84 2,962.96 83,787.20

2015 86,755.00 6.20 0 86,748.80

2016 86,755.00 21.00 0 86,734.00

2017 86,755.00 21.00 0 86,734.00

2018 86,755.00 21.00 0 86,734.00

2019 86,755.00 21.00 0 86,734.00

2020 86,755.00 21.00 0 86,734.00

2030 86,755.00 21.00 0 86,734.00

2048 86,755.00 21.00 0 86,734.00

Total 3,123,180 252.03 2,962.96 3,119,989

6.5 Climate Change Adaptation Benefits (GL1)

There is a relatively widespread understanding in the scientific community that balanced ecosystems have greater ecological and social resilience and adaptability to climate change,

57 See annex 18 58 See annex 21 59 See annex 25 - HDOM (Study on deforestation and heat spots for EBCF REDD+ Project technical report)

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whether through protection of water bodies and regulation of river flows during peak flood and drought, or through the regular supply of environmental services, products and services.

Thus, once the project is designed to conserve an area of native forest, which in the absence of the project scenario would remain subject to the pressure of timber management (baseline) and consequent degradation resulting from such activities, it is understood that the mere protection of these areas alone would offer communities and the ecosystem itself better adaptability compared to the baseline scenario.

Moreover, the project has an Activity Management Plan (Annex 9), which details, among other initiatives, the promotion of the sustainable use of ecosystem resources through direct support in some activities related to income generation and conservation, along with community training. It is believed that, in addition to ensuring a more balanced (and therefore more resilient) environment, the project will expand the options for generating income among the communities, making them more resilient and preparing them to face the greater and already perceived challenges posed by climate change.

7 COMMUNITY

7.1 Positive Impacts for Communities (CM1)

EBCF’s REDD+ project was first presented to the riverine communities in 2011. By then, communities were informed about the cessation of all timber exploration activities due to the REDD+ project and discussions were held regarding biodiversity conservation and the sustainable use of forest products and services, as well the social development of the surrounding communities. Project Area Zoning

The participatory project zoning activities, held during the management plan preparation phase, are an initiative aimed to identify and mitigate risks as well as to start to structure potential economic and social developments. The zoning also allows discussions within communities about the objectives of EBCF’s REDD+ project and make clear its conservationist purpose, as well as how communities are expected to get involved in the project’s objectives.

The definition of specific areas, preliminary diagnosis and approach goals with the communities were conducted in the scope of management plan (under approval stage at SEMA - Annex XX). Project activities during the first monitoring period, aimed to carry out diagnostics, workshops, field work, technical meetings and studies. These activities were held in the context of (i) preparation of

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PD, the (ii) participatory elaboration of the management plan, and (iii) development of new projects.

Besides the review and conceptual treatment of secondary information, primary data was collected through two workshops, field surveys, questionnaires and sustainability matrices application (ANNEXES II and III), technical meetings and forest surveys on dry lands and lowland floodable areas (Management Plan, p. 14).

The first workshop, held on February 22, 2013, had as outcome the following final products: 4 land use map, 12 sustainability matrices, 12 completed questionnaires and the creation of a Management Plan Monitoring Group, composed of partner institutions which later became the Advisory Board to support 15 to meet the legal requirements (Annex IV).

57 residents of 12 communities participated in the workshop, as well as technical staff of CO2X Forestry Conservation Company and EBCF, and representatives of partner institutions, among which: the Amazonas State Center of Conservation Units, the Manicoré City Council and Secretariat of Environment, the Agroextractive Associations Center for Democracy, the Chico Mendes Institute for Biodiversity Conservation, the Amazonas Sustainable Foundation (FAS) and the Renascer Human Development Enterprise.

The same work was done through specific visits to two communities that did not participate in the workshop: São José do Miriti, with 11 representatives and Sao Joao and Ponta Grossa Agroextractivist Association, with 31 representatives. These also produced as outcomes maps, sustainability matrices and questionnaires. Field surveys in these communities focused on visits to agroextractive production areas such as family farmlands, latex trees fields, and perennial crops of açaí and cocoa. Interviews were also conducted with focus groups and leaders in order to collect information and questions raised during the workshops.

Finally, a socio-economic census to collect information from each family on demographics, income, health, education, livelihoods, agricultural production and extractive collection was applied at each household in all communities, except at the communities of Terra Preta extension road, as residents were absent when visited. The census also raised populations’ expectations regarding social improvements with the implementation of the Management Plan. Census statistics are available as PDF files for viewing (Pages 15-17).

Building local capacity

From the conceptual and practical stand point it is essential to expand local capacities for the management of initiatives in partnership with the REDD project team. This initiative has an impact v3.0 126 MONITORING & IMPLEMENTATION REPORT VCS Version 3, CCB Standards Third Edition

beyond the project itself, leaving a legacy of learning and support to local communities. The project management is convinced that conservation of biodiversity and social development should occur via the expansion of local capacity. This approach is the attempt to make viable preservation over time avoiding the exclusive dependence on the monitoring and law enforcement. As a measure to achieve social development while strengthening local capacity, EBCF started programs on Health in the Amazon and Sustainable Business.

The Amazon Health Program's mission is to implement projects aimed to improve Water and Sanitation health conditions in the communities surrounding EBCF’s reserves. The program started the project "Drinking Water for All" which made diagnosis, water use training and implementation of water filters in all ten communities the EBCF’s REDD+ project distributed water filters. The project aims to raise awareness on the importance of clean drinking water as a way to prevent the incidence of waterborne diseases.

PFigurehoto 1: 12Water. Water Filter Filterss installed installed in 10 communities. in 10 communities. A student of theA studentDemocracy of Community the Democracy School consumingCommunity clean School filtered consumingwater. clean filtered water.

The "Family Health" project promotes training and equipment of community health workers. Through the Project, community health workers have been trained in all the communities surrounding the reserve and were made available "basic care kits" containing the following items:

- Digital blood pressure check device; - Glucose check kit; - Box with 50 units of glucose check strips; - Box with 50 units of lancets; - Clinical thermometer and scale; - Measuring tape, flashlight, clipboard, backpack, work apron and cap.

Developing sustainable business in the region

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EBCF comes over the last 4 years dedicated to develop a set of economic activities integrated with the local economy as per provisions in the PD and Management Plan. Such sustainable business initiatives are at an advanced stage of conception and have been prioritized for follow-up on cosmetics, food and services. The business model provides a direct link of local communities and the COVEMA cooperative, in the municipality of Manicoré.

Partnership with companies interested in regional products from RPDs and its surroundings, are in the final contracting phase and will begin the set of activities for the organization of production, certification of origin and local processing. EBCF has planned, within the next 12 months, to generate local income through the production and trade of regional products and services. The resources of the REDD project will be decisive for the fulfilment of this agenda.

Despite the great local knowledge about the ecosystem and environments of the region, there is a technological deficit in adding value to agro-extractive products and thus conserve natural resources. Over such constraints, public extension services in general, guide the use of techniques and farming practices and management that require high external inputs and major investments.

Currently EBCF is working hard in structuring production activities and services in partnership with local communities, such as production of Amazonian oils, cocoa beans for chocolate, fruit production and eco-tourism, among other potential products in the region.

In this regard, several initiatives are being conducted by EBCF and its partners to develop sustainable production based on the abundance of special products of the region. Andiroba, Buriti, cocoa, nuts, açaí, passion fruit and cupuaçu are some of these potential products. These initiatives depend on value chains involving specialized companies in cosmetics and food segments. The management plan (Annex 09) held a survey to base the design of production arrangements. In October 2015 the sportsman Victor Belfort visit the sites as part of the approach to the development of a line of food products and raw materials in the region.

The segments of cosmetics and functional food are in an advanced stage of negotiation with partners. It was established a partnership with the company Sinerga in Italy, which specializes in ingredients for the cosmetics industry. The partnership aims to provide inputs from Amazon natural sources. With the consolidation of new businesses in this segment, EBCF pursues to start establishing supply chains with the surrounding communities of reserves.

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Figure 13. Vitor Belfort performing a lecture to locals at Democracy community - 2015

To evaluate the progress of these initiatives throughout the development of the project, we used the methodology of the Sustainability Matrix developed by the Secretariat of Environment and Sustainable Development of Amazonas State. This tool was applied in 15 communities, taking into account local socio-economic aspects that underlie the development of 20 parameters considered of great importance to community development, described by specific indicators. As a visual tool, the Sustainability Matrix is quite suitable for traditional populations, such as the riverside and indigenous communities surrounding the Reserve Amazon River I and other areas of the Project. Additionally, the Matrix provides interesting spaces for discussion, since its construction is done collectively.

Through the Sustainability Matrix it was possible to identify, along with the communities, projects, activities and implementation strategies. Budgets and monitoring and evaluation of these projects will be detailed later, through the Annual Operational Plans to be developed and followed up in the due course. Four programs and nine subprograms were defined for management and community development (Annex 9).

7.2 Negative Impacts (CM2)

No negative impacts have been recorded or identified as a result of the project with stakeholders.

7.3 Exceptional Benefits for Communities (GL2)

Income-generating activities are being structured so benefits could still not be felt or recorded at this stage.

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8 BIODIVERSITY

8.1 Positive Impacts for Biodiversity (B1)

The benefits for biodiversity are in reducing deforestation and degradation (selective logging) in the project area. According to satellite images analysis in the project areas and their surroundings, it was observed that until 2010, 300 hectares were deforested. After the implementation of the project, community awareness on the importance of preservation and conservation of forests have encouraged "no deforestation / degradation," and a significant reduction in deforestation was identified (see graph below). This was due to the good understanding of the project's conservation objectives, and by the involvement and support of the surrounding communities.

Figure 14. EBCF REDD Project and buffer áreas deforestation figures (source: HDOM Report).

The consequences of deforestation and degradation on biodiversity are well known. Thus, the fact of not being identified changes (natural or anthropogenic) in forest areas, shows there was no loss of biodiversity, no reduction in floristic diversity, no impact on the dynamics of fauna and flora, and no loss of evolutionary genetic information.

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8.2 Negative Impacts on Biodiversity (B2)

There are no negative impacts on biodiversity as a result of the project.

8.3 Exceptional benefits for Biodiversity (GL3)

The description of "exceptional" benefits for biodiversity will only be possible after the re- measurement of permanent plots. (FLORA).

9 ADICIONAL INFORMATION

All activities and the consequent reduction in deforestation and degradation in and around the project areas were maintained and funded without resources of carbon credits. We understand that with the advance of REDD+ project, EBCF will have much better conditions to implement positive actions in partnership with communities.

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