INTEGRATED SAFEGUARDS DATA SHEET CONCEPT STAGE Public Disclosure Copy Report No.: ISDSC3364 Date ISDS Prepared/Updated: 04-May-2014 Date ISDS Approved/Disclosed: 05-May-2014 I. BASIC INFORMATION A. Basic Project Data Country: Kenya Project ID: P145234 Project Name: Kenya Petroleum Technical Assistance Project (KEPTAP) (P145234) Task Team Alexander Johannes Huurde Leader: Estimated Estimated 24-Jul-2014 Appraisal Date: Board Date: Managing Unit: SEGM2 Lending Technical Assistance Loan Instrument: Sector(s): Public administration- Energy and mining (40%), Oil and gas (40%), Other Mining and Extractive Industries (20%) Theme(s): Other environment and natural resources management (50%), Other accountability/anti-corruption (25%), Other Private Sector Developme nt (25%) Financing (In USD Million) Total Project Cost: 50.00 Total Bank Financing: 50.00 Public Disclosure Copy Financing Gap: 0.00 Financing Source Amount BORROWER/RECIPIENT 0.00 International Development Association (IDA) 50.00 Total 50.00 Environmental B - Partial Assessment Category: Is this a No Repeater project? B. Project Objectives The project development objective (PDO) is to strengthen the capacity of the GoK to manage its extractive industries sector for sustainable development impacts. C. Project Description COMPONENT 1: Petroleum Sector Reforms and Capacity Building Through the activities grouped under Component 1, at the policy level, the Project would support the drafting of a comprehensive Petroleum Policy outlining a vision and policy for the petroleum sector. Also, through this Component the Project would provide technical assistance to develop a Petroleum Public Disclosure Copy Master Plan that considers strategic options and decision hierarchies for policies and investments in the Project Area on a sound economic basis. A National Communication Strategy (NCS) would also be developed to empower a greater proportion of the Kenyan public to effectively access, understand and participate in the ongoing dialogue on using the petroleum and mining deposits as a source of national wealth. At the regulatory level, the Project would support the implementation of a comprehensive, clear and workable regulatory framework for the development of Kenya’s petroleum resources. At the same time, the Project would support the implementation of institutional reforms including the identification and division of roles, establishment of new institutions if needed and capacity building for relevant institutions. At the transaction level, the Project would also support capacity building for negotiation of petroleum deals. Also, through this Project, GoK would hire and contract consultants for provision of transaction advisory services. The Project would also support the acquisition, interpretation and promotion of geodata in the Project Area and capacity building related to petroleum cadastre database of the Project Area. The Project would also provide technical assistance to manage the impacts from the petroleum sector including the implementation of health & safety reforms, implementation of environmental and social reforms and development of a framework for oil spill preparedness and response capacity. COMPONENT 2: Revenue and Investment Management Reforms and Capacity Building Through the activities grouped under Component 2, the Project would support the design and implementation of fiscal framework reforms in order to improve extractive industries taxation in Kenya. The Project would also address transparency and accountability across the extractive Public Disclosure Copy industries value chain through a variety of mechanisms including technical assistance to subscribe to and become compliant with EITI. The Project would also provide technical assistance for drafting and implementing the appropriate legal and institutional mechanisms to allocate revenues from the extractive industries in a balanced way. In addition, through this Component, the Project will provide technical assistance to the Ministry of Finance and Central Bank for the design and implementation of the appropriate fiscal mechanisms to address 1) the finite nature of most natural resource endowments (e.g. savings funds) and 2) the volatility of resource revenues (e.g. dedicated buffer or price stabilization funds). Also, the Project would finance capacity building for setting-up a robust system of public financial and investment management in anticipation of extractives revenues and potential increase in public investments. COMPONENT 3: Project Management. The Project proceeds would also be used for the management and coordination of the Project and for building GoK’s procurement, financial management, safeguards management, monitoring and evaluation capacity through the provision of technical advisory services, training, acquisition of goods, and operating costs. The activities under this proposed project, as described above, will be performed at the central government level and any procurement of goods and services will be targeted to the onshore areas of Public Disclosure Copy Kenya as well as a limited set of offshore locations (" exploration blocks") which are not subject to any dispute. D. Project location and salient physical characteristics relevant to the safeguard analysis (if known) This is a desk top study and not related to a physical project. E. Borrowers Institutional Capacity for Safeguard Policies Institutional capacities for assessing and implementing the requirements and standards of the Safeguards Policies are limited. Assistance from the Project will be extended to the Ministry of Environment and Mineral Resources, NEMA and other relevant institutions to design and implement sector specific regulations, standards, frameworks and baselines for petroleum operations. The Strategic Environmental and Social Assessment and safeguards support will inform the Government on environmental and social management of the sector, including environmental and social impacts – including understanding of the gender dimensions of the sector, involuntary resettlement, and health and safety. Strengthening of resettlement policies, guidelines and practice standards will complement the policies aimed at maximizing the positive aspects of large scale petroleum industry development, such as access to infrastructure and power, job creation, increased employment opportunities and business development. The project will support the development of an Environmental and Social Management Information System, the purchase of environmental monitoring equipment for sampling and testing of water, air and soil to support inspections and monitoring of operations. Advisory Services and Training for NEMA staff to strengthen their capability of providing effective and efficient oversight of petroleum sector in accordance with sector-specific environmental regulation and in line with international best practice will be provided. The project will develop procedures, standards and processes related to Hazardous Waste Management and Gas Flaring. Public Disclosure Copy F. Environmental and Social Safeguards Specialists on the Team Nyambura Githagui (AFTCS) Sanjay Srivastava (AFTN3) II. SAFEGUARD POLICIES THAT MIGHT APPLY Safeguard Policies Triggered? Explanation (Optional) Environmental Assessment OP/ Yes Environmental Assessment OP/BP 4.01 has BP 4.01 been triggered. The TA Project will improve the client’s environmental management capacity on key environment and social issues relating to petroleum operations. Therefore a Strategic Environmental and Social Assessment will be undertaken. The SEA to be prepared as part of the project TA will include an assessment environmental and social impacts, involuntary resettlement, and health and safety aspects in Petroleum operations. Terms of Reference for Strategic Environmental and Social Assessment (SESA) will be consulted upon and disclosed before appraisal. Natural Habitats OP/BP 4.04 No Public Disclosure Copy Forests OP/BP 4.36 No Pest Management OP 4.09 No Physical Cultural Resources OP/ No BP 4.11 Indigenous Peoples OP/BP 4.10 No The SESA will undertake social analysis to identify areas with potential presence of indigenous or vulnerable population including risks resulting from future petroleum operations. Involuntary Resettlement OP/BP No The TA project does not envisage any land 4.12 taking or preparation of future investments that may involve involuntary land acquisition. The SESA will, however include analysis of socio- economic aspects of typical petroleum operations, including areas for strengthening of resettlement policies, guidelines and practice standards in Kenya, which can complement the local resettlement policies Safety of Dams OP/BP 4.37 No Projects on International No Waterways OP/BP 7.50 Projects in Disputed Areas OP/BP No Public Disclosure Copy 7.60 III. SAFEGUARD PREPARATION PLAN A. Tentative target date for preparing the PAD Stage ISDS: 30-Apr-2014 B. Time frame for launching and completing the safeguard-related studies that may be needed. The specific studies and their timing1 should be specified in the PAD-stage ISDS: -A Strategic Environmental and Social Assessment (SESA) will be undertaken during the project implementation. A terms of reference and scope of SESA will be prepared as part of preparation. IV. APPROVALS Task Team Leader: Name: Alexander Johannes Huurde Approved By: Regional Safeguards Name: Alexandra C. Bezeredi (RSA) Date: 04-May-2014 Coordinator: Sector Manager: Name: Christopher Gilbert Sheldon (SM) Date: 05-May-2014 1 Reminder: The Bank's Disclosure Policy requires that safeguard-related documents be disclosed before appraisal (i) at the InfoShop and (ii) in country, at publicly accessible locations and in a form and language that are accessible to potentially affected persons.