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BBOP Pilot Project Case Study – Ambatovy Project
2. Project Context
2.1 Policy context
Investment projects in Madagascar must be compatible with Malagasy environmental regulations. This
principle is embedded in the MECIE (
Mise en Compatibilité des Investissements avec l'Environnement
)
decree (Decree N° 2004-167 modified). The application of this decree is enforced by the environmental
regulator, ONE (
Office National de l’Environnement
), which has developed stringent guidelines and protocols
on how to elaborate, review, permit and monitor Environmental and Social Impact Assessments (ESIA).
Although the terms of reference for an ESIA in Madagascar typically require stringent mitigation of impacts,
biodiversity offsets are not included in the text.
The Government of Madagascar became aware of biodiversity offset mechanisms through interactions with
environmental NGOs in 2005 (WWF, Conservation International – CI, Wildlife Conservation Society – WCS).
Subsequently, the BBOP Secretariat attended a presidential audience to discuss biodiversity offsets in June
2006 during which the concept of offsets as a complementary mechanism to reduce impacts on Madagascar’s
heritage was well received by the President of Madagascar. Biodiversity offsets were subsequently referred to
in the Madagascar Action Plan (MAP) 2007 – 2012:
Commitment # 7 “Cherishing the Environment”
Challenge # 3 “Develop the Environmental Reflex at All Levels"
Priority Projects and Activities # 3 “Develop a policy for mining companies and logging companies for
biodiversity offsets
and other mechanisms and incentives for environmental protection”
The ESIA for the Ambatovy Project (MINEVEF/ONE Permit # 47/06 dated December 1st, 2006) established
that the Project, and specifically the mine component, would be located in a sensitive biodiversity area and
that the mitigation of residual impacts would require both on-site and off-site compensation measures. While
on-site measures at the mine are commitments made in the ESIA, the Ambatovy offset programme goes
above and beyond compliance with legal obligations. The offset programme is believed to deliver positive
conservation outcomes under a vision of no net loss of biodiversity, and possibly net gain. This would enable
the Project to honour its stringent biodiversity policy developed and endorsed by its shareholders:
“… to cause no net harm to biological diversity where we operate, to mitigate unavoidable impacts, and to
practice responsible closure procedures;
… to assure the conservation of habitats, flora and fauna, using all reasonable actions and technologies;
… to ensure responsible attention to the maintenance and, where possible, enhancement of biodiversity in
the best interest of our business, the communities in which we operate, and the world at large.”
The Project’s principal financial lenders have subscribed to the Equator Principles (
-
principles.com/index.shtml
). In this context, full regulatory compliance and the implementation of a thorough
impact management strategy is expected. In addition, the lenders also require the Project’s general
compliance with the IFC Performance Standards and specifically Performance Standard 6 (Biodiversity
Conservation and Sustainable Natural Resource Management). In the context of biodiversity offsets,
