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Peru LNG Project (Ex-Im Bank reference AP080938XX) ENVIRONMENTAL REQUIREMENTS SUMMARY

Peru LNG is developing a liquefied natural gas (LNG) project consisting of the development, construction and operation of a liquefied natural gas plant.  Peru LNG will purchase natural gas from Block 56 and 88 (Upstream Operations).  The gas will be transported through the existing, over-sized TgP gas pipeline though the jungle to KP 211 where it will enter a  newly constructed 408‑kilometer, 34” natural gas pipeline for transport to the LNG plant located at Pampa Melchorita, 105 miles south of Lima on the Pacific coast.  The plant consists of a 4.45 million tons per annum liquefaction train. The LNG will be loaded onto tankers at a marine loading terminal adjacent to the LNG plant for export to market.  Ex-Im Bank approved financing for the Project on January 24, 2008.

Project related environmental documents made available prior to approval included an EIA, supplemental environmental information packages, project management & action plans, programs, surveys and an independent report evaluating Ex-Im Bank’s environmental and social due diligence that was issued in December 2007 by URS.

Environmental requirements associated with Ex-Im Bank financing:

The Project assumed numerous environmental requirements in conjunction with Ex-Im Bank (and other lender) financing.  The material requirements are summarized below:

1. General provisions, including requirements that the Project comply with local environmental laws and promptly notify Ex-Im Bank and lenders of environmental matters, such as any material non-compliances with social or environmental requirements or the occurrence of events relating to social or environmental matters that could cause significant adverse risk.
    
2. Support the establishment of an Independent Advisory Panel composed of recognized and eminent experts and/or scholars in environmental and social science to conduct annual reviews and prepare reports to Ex-Im Bank regarding the environmental, social and cultural effects associated with all aspects of the Peru LNG Project.  The Panel is expected to be established by late 2008.
• First annual reports undertaken by the panel expected before January 1, 2010
   
3. During construction of the Project, provide periodic Environmental and Social Compliance Reports on the results of monitoring of the Project’s compliance with the Environmental, Social, Health and Safety Management System (ESHS-MS) against relevant standards and key performance indicators. The Reports will be submitted quarterly until construction completion, on a semiannual basis for the first year following completion, and annually thereafter.
• First quarterly report on compliance during construction due October 31, 2008
• First Environmental and Social Compliance Reports during operations expected about July 31, 2011, to be provided semiannually for the first year of operations, and annually thereafter 
   
4. Submittal of the following Plans due October 31, 2008:
• Project Biodiversity Monitoring Plan
• Project Ecological Management Plans
• Biorestoration Management Plan
• Pipeline Contingency Plan - Construction Phase
   
5. Submittal of an emergency response contingency plan for the operations phase of the LNG plant, marine facility and pipeline.  
• Due 60 days prior to initial operations (estimated May 1, 2010)
   
6. Submittal of Community Environment Monitoring Program to monitor the Peru LNG pipeline’s level of compliance with applicable environmental standards and commitments.
• Due on October 31, 2008
   
7. Report on the status of the local fisherman’s compensation agreement
• Due October 31, 2008
   
8. Provide to Ex-Im Bank, to the extent available from the upstream operator of Blocks 56 and 88, an integrated Environmental, Social, Health and Safety Management System applicable to Blocks 56 and 88.
• To the extent available, expected to be provided to Ex-Im Bank during the second quarter of 2009
   
9. Provide to Ex-Im Bank, to the extent available from the upstream operator of Blocks 56 and 88, an Integrated Indigenous Peoples Development Plan for people within the area of influence of the upstream areas near Blocks 56 & 88, and the Malvinas gas processing plant.
• To the extent available, expected to be provided to Ex-Im Bank during the first quarter of 2009
   
10. Submittal of an Ecological Management Plan addressing the Camisea or upstream region
• To the extent available, expected to be provided to Ex-Im Bank during the first quarter of 2009
   
11. Submittal of Upstream Action Plan Implementation Reports relating to the existing Camisea or upstream operations to include information relating to the upstream operations’ implementation of the Upstream Action Plan, including the Integrated Environmental Social, Health and Safety Management System (ESHS-MS), activities related to the Integrated Indigenous Peoples Development Plan and activities related to the Ecological Management Plan.  These reports are expected as follows.
• First report on Upstream Action Plan implementation is due October 31, 2008, to be provided quarterly until June 30, 2009, semiannually thereafter until June 30, 2011, and annually thereafter
   
12. Prior to commercial operation of the Project, submittal of a report indicating programs in place to provide affected communities located within the Peru LNG Project area of influence with guidance and assistance in obtaining benefits from the funding mechanisms that target such communities.
• Expected to be available in May 2010

Requests for a copy of any of the reports listed above that relate directly to the Peru LNG Project may be made once the desired report becomes available by contacting the following:

Export-Import Bank of the United States
Engineering and Environment Division
811 Vermont Ave. N.W.
Washington D.C. 20571
1-202 565-3570
Fax – 202 565-3584

The availability of such reports is subject to U.S. Federal law, which may require Ex-Im Bank to protect them from disclosure.

Updated: October 17, 2008

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