3 APPROACH TO EIA PROCESS AND PUBLIC PARTICIPATION

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1 SLR Environmental Consulting (Namibia) (Pty) Ltd Page APPROACH TO EIA PROCESS AND PUBLIC PARTICIPATION This chapter provides presents the EIA assumptions and limitations and outlines the EIA process, including the assessment methodology and I&AP consultation process. 3.1 EIA ASSUMPTIONS AND LIMITATIONS The assumptions and limitations on which this EIA is based are: SLR assumes that all relevant project information has been provided and that it was correct and valid at the time it was provided. Although no decision has been made on the type of drilling unit to be used, the assessment will be based on the specifications and operational parameters of the drill ship Noble Globetrotter II, which is currently contracted to Shell for a 10-year period. An area of interest has been selected for the EIA, as the specific locations of the wells are not known. This EIA assumes that the wells could be drilled anywhere within the area of interest. The exact timing of well drilling is not known at this stage, but the EIA assesses the implications of drilling in different seasons. The technical drilling and operational parameters provided (or range thereof) are based on Shell s previous drilling campaigns and it is assumed that the technical specifications used in this EIA are roughly equivalent to the drilling operation that may occur in future. This EIA considers potential impacts that have been identified within the project s area of influence, which encompasses: > activities and facilities that are directly owned, operated or managed by Shell (including contractors) and are considered to be a component of the project; > unplanned events, which are are unintended but may occur as a result of accidents or abnormal operating conditions; and > indirect project impacts on biodiversity or ecosystem services upon which affected communities livelihoods are dependent. Thus, the focus is on impacts within Namibia and the offshore area of interest for drilling. No significant changes to the project description or surrounding environment between the completion of the EIA process and implementation of the proposed project that could substantially influence findings and recommendations with respect to mitigation and management will occur. 3.2 EIA OBJECTIVES The EIA process has the following objectives: To provide opportunity for I&APs to be involved in the EIA process. To ensure potential environmental and social issues and impacts that would result from the proposed project are identified. To identify feasible alternatives related to the project proposal. To assess potential impacts of the proposed project alternatives during the different phases of project development. To present appropriate mitigation/management or optimisation measures to minimise potential impacts or enhance potential benefits, respectively. Through the above, to provide information to facilitate informed, transparent and accountable decisionmaking by the relevant authorities.

2 SLR Environmental Consulting (Namibia) (Pty) Ltd Page EIA PROCESS The EIA process consists of two phases (Scoping and Impact Assessment) and a series of steps to ensure compliance with the EIA Regulations 2012 as set out in GN No. 30 and the objectives listed above. The process involves an open, participatory approach to ensure that all impacts are identified and that relevant information on environmental and social impacts is provided into the decision making process. A flowchart illustrating the regulated EIA process is presented in Figure 3-1. Figure 3-1: EIA process

3 SLR Environmental Consulting (Namibia) (Pty) Ltd Page SCOPING PHASE The purpose of the Scoping Phase was to communicate the nature of the proposed project to I&APs, identify the most significant issues for investigation and assessment, and to develop the terms of reference for specialist studies conducted in the Impact Assessment Phase. The Scoping Phase involved: notifying I&APs of the proposed project and the steps in the EIA process; creating an opportunity for I&APs to interact with the EIA project team; and providing adequate information for I&APs to comment on in order to ensure that all key environmental and social issues are identified. Steps undertaken during the Scoping Phase are summarised below Project initiation and screening Project initiation SLR and Shell held an EIA initiation meeting on 28 February and 1 March The purpose of this meeting was to: Confirm the technical and engineering scope of the exploration well drilling campaign; Identify feasible technology, logistics routing, site and design alternatives; Identify measures to avoid negative impacts; Investigate ways to reduce the project footprint; Identify significant environmental and social issues; Confirm EIA scope, process steps and permitting requirements; and Confirm the information requirements for the EIA Authority pre-application meetings SLR and Shell met with MET and MME on 1 and 14 March 2017, respectively. The purpose of these preapplication meetings was to provide notification of the commencement of the EIA process and to inform the authorities on the EIA process to be followed, as well as to obtain clarity thereon Application for Environmental Clearance Certificate An Application for Environmental Clearance was hand-delivered to MME on 14 March 2017 and an electronic copy was ed on 17 March Scoping public participation process The objective of the scoping public participation process was to ensure that I&APs were notified about the proposed project, given a reasonable opportunity to register on the project database and to provide comments. Steps undertaken during this phase are summarised in Box 3-1.

4 SLR Environmental Consulting (Namibia) (Pty) Ltd Page 3-4 Box 3-1: Tasks undertaken during the scoping public participation process 1. Initial public engagement process The initial public engagement process involved the following: Identification of I&APs: A preliminary I&AP database of authorities, Non-Governmental Organisations, Community-based Organisations and other key stakeholders was compiled using Shell s existing database for PEL 39, as well as other databases of previous studies undertaken in the area and input from the fishing industry. Additional I&APs were added to the database based on the tasks below. To date 301 I&APs have been registered on the project database, excluding the project team (see Appendix 2.1). Notification letter and Background Information Document (BID): All I&APs on the database were notified of the application and EIA process by means of a notification letter and BID. The BID (in English and Afrikaans) was compiled to provide introductory information on the project, to encourage people to register on the I&APs database and to provide an initial opportunity to comment. The BID was distributed for a 21-day review and comment period from 10 April to 5 May Advertisements and site notice: Repeat advertisements announcing the proposed project, the availability of the BID, public meetings and the I&AP registration / comment period were placed in The Namibian (English) and the Republikein (Afrikaans) on 10 and 18 April 2017, respectively. Site notices (in English and Afrikaans) were erected outside the port entrance in Lüderitz. Focus group and public meetings: The following focus group and public information meetings were held during April 2017: > 19 April 2017: Focus group meeting with Dave Russell in Walvis Bay; > 19 April 2017: Focus group meeting with invited Fishing Associations in Walvis Bay; > 19 April 2017: Public meeting in Walvis Bay; > 20 April 2017: Focus group meeting with invited MFMR officials in Swakopmund; > 20 April 2017: Focus group meeting with invited Environmental NGOs in Swakopmund; > 25 April 2017: Public meeting in Lüderitz; and > 26 April 2017: Focus group meeting with the Lüderitz Town Council. At these meetings Shell and SLR provided an overview of the project proposal and EIA process, and provided stakeholders the opportunity to raise any issues or concerns. 2. Compilation and review of Draft Scoping Report (DSR) The preparation of the DSR was informed by comments received during the initial public engagement process. Responses to all issues raised during the initial public engagement process were collated into a Comments and Responses Report, which was appended to the DSR. The DSR was distributed for a 30-day review and comment period from 5 July to 4 August Tasks undertaken included: DSR availability: Copies of the DSR were made available on the SLR website and at public libraries in Walvis Bay, Swakopmund and Lüderitz. I&AP notification: DSR notification was ed to all I&APs registered on the project database. The letter informed them of the release of the DSR and where the report could be reviewed. To facilitate the commenting process, a copy of the DSR Executive Summary (in English and Afrikaans) was attached to the Compilation and approval of the Final Scoping Report The Final Scoping Report (FSR) was prepared in compliance with Section 8 of the EIA Regulations 2012 and was informed by all comments received during the public participation process described in Box 3-1. The key issues and concerns identified by the project team, with I&AP input, during the Scoping Phase are

5 SLR Environmental Consulting (Namibia) (Pty) Ltd Page 3-5 summarised in Box 3-2. This information provided the basis on which the specialist studies and associated terms of references were determined. Box 3-2: Key issues and concerns 1. Effect on marine and coastal ecology The proposed project could result in the following potential effects on marine and coastal ecology: Localised reduction in air quality due to emissions from the combustion of diesel fuel for generators and other machinery used to power the drilling operations and vessel engines, aviation fuel for aircrafts and helicopters, as well as the incineration of wastes and hydrocarbons (during flaring); Localised reduction in water quality due to normal discharges to the marine environment from a variety of sources, including deck drainage, machinery space drainage, sewage and galley wastes from the drilling unit and support vessels; Localised disturbance of and / or behavioural changes to marine fauna due to noise and lighting from the drilling unit, support vessels and helicopter operations; Sediment disturbance due to drilling activities and placement of infrastructure on the seafloor; Smothering of and biochemical effects (e.g. direct toxicity and bioaccumulation) on relatively immobile or sedentary benthic species due to the discharge of cuttings, drilling fluid and cement during well drilling; Increased biodiversity and biomass on wellhead due to hard substrate habitat available for colonisation by benthic organisms; Introduction of alien invasive marine species through international vessels and equipment transfer and ballast water discharge; and Localised and regional effect on water quality, fish catch, benthic organisms and oiling of coastline and seabirds due to accidental oil spills during normal operations (e.g. bunkering at sea), as well as the unlikely event of a large blow-out. 2. Effect on commercial fisheries The proposed 500 m safety zones around the drilling unit, drilling noise, the abandonment of the wellheads on the seafloor and accidental oil spills during normal operations, as well as the unlikely event of a large blow-out, could potentially affect fisheries in the following ways: Disturbance / behavioural changes to fish; Displacement of fishing activities; Loss-of-access to fishing grounds; Increased fishing effort; and Loss of catch. 3. Effect on socio-economic environment Potential social and economic effects include: Creation of short-term employment, and business and training opportunities; Flow of revenue to the Namibian government; and Negative consequences due to accidental oil spills during normal operations, as well as the unlikely event of a blow-out. Taking cognisance of the scoping tasks and considerations described above, a high-level screening of the interaction between the proposed project activities and the receiving environment (see Table 3-1) and an Aspects and Impacts Register (see Table 3-2) were developed. These were used as a framework to ensure that all project activities, environmental aspects and impacts, and interactions were identified and understood. The FSR was accepted by MET on 4 September 2017 (see Appendix 3). The MET acceptance stated that SLR is to proceed with the full EIA process in terms of Section 35(1)(b) of the Environmental Management Act, 2007.

6 SLR Environmental Consulting (Namibia) (Pty) Ltd Page 3-6 Table 3-1: Environmental and Social Interaction Matrix Resource / Receptors Sensitive receptors in the receiving environment Physical Biophysical Socio-economic Project Phase Project Activities Water Column (including Water Quality, Noise and Turbidity) Atmosphere (including Air Quality and Noise) Seabed Sediment and Profile Fish and Plankton Communities Benthic Habitats and Communities Sea and shore birds Marine Mammals Seabed Features and Seamounts Nearshore Habitats and Communities Protected Area Fishing Maritime Heritage Marine Traffic / Navigation Public Health and Safety Infrastructure and Services Settlements, Tourism and Recreation Employment & Income Planned Activities (Normal Operation) Mobilisation Transit of drilling unit and support vessels to drill site Discharge of ballast water Rental of accommodation Rental of quay space Appointment of local service providers Procurement of equipment / materials Seabed ROV survey Operation Presence and operation of drilling unit and support vessels Operation of helicopters Spudding of well and drilling Discharge of drill cuttings and excess cement Well logging and testing Plug well with cement Demobilisation Abandoned wellheads on seafloor Demobilisation of drilling unit and support vessels from drill site Unplanned Activities (Emergency Event) All Vessel accident Operation Dropped objects / lost equipment Hydrocarbon spills (minor) Loss of well control / Blow-out Colour key: No interaction Minor negative interaction Moderate / major negative interaction Positive interaction

7 SLR Environmental Consulting (Namibia) (Pty) Ltd Page 3-7 Table 3-2: Aspects and Impacts Register Activity Phase Activity Aspect Potential Impact 1. Mobilisation Phase Transit of drilling unit and support vessels to drill site Underwater noise levels Air emissions and local reduction in air quality due to exhaust gases Discharge of waste to sea (e.g. deck and machinery space drainage, sewage and galley wastes) and local reduction in water quality Exclusion zone around drilling unit Disturbance of behaviour (foraging and anti-predator) and physiology of marine fauna Potential contribution to cumulative impact on local air quality Physiological effect on marine fauna Increased food source for marine fauna Increased predator - prey interactions Disruption of shipping routes by ships having to make detours Disruption to fishing activities Discharge of ballast water Introduction of invasive alien species Loss of biodiversity Rental of accommodation Requirement for rental and owner-occupied housing Revenue or income for landlords and rental businesses Rental of quay space Requirement for quay space for onshore facility and support vessels Revenue or income for Namport Appointment of local service providers Recruitment for temporary jobs Business opportunities Temporary job creation and earning of salaries Income for local service providers Procurement of equipment / materials from the local market Business opportunities Income for suppliers Disturbance / behavioural changes to marine fauna Increase in underwater noise levels Fish avoidance of key feeding areas (e.g. Tripp Seamount) Reduced fish catch and increased fishing effort 2. Operation Phase Operation of drilling unit and support vessels Discharge of waste to sea (e.g. deck and machinery space drainage, sewage and galley wastes) and local reduction in water quality Physiological effect on marine fauna Increased food source for marine fauna Fish aggregation and increased predator - prey interactions Exclusion zone around drilling unit Disruption of shipping routes by ships having to make detours Reduced fishing grounds and catch Increase in ambient lighting Disorientation and mortality of marine birds Increased predator - prey interactions

8 SLR Environmental Consulting (Namibia) (Pty) Ltd Page 3-8 Activity Phase Activity Aspect Potential Impact Disturbance of coastal and marine fauna 2. Operation Phase (cont.) Operation of helicopters Increase in noise levels Avoidance of key breeding areas (e.g. coastal birds and cetaceans) Abandonment of nests (birds) and young (birds and seals) Seabed survey using a ROV Sediment disturbance Physical damage to and mortality of benthic species / habitats Well drilling (including spudding) Discharge of residual cement during cementing operations Sediment disturbance Increase in underwater noise levels Accumulation of cement on seafloor and sediment disturbance Physical damage to and mortality of benthic species / habitats Disturbance of or damage to cultural heritage material (e.g. historical shipwrecks) Disturbance / behavioural changes to marine fauna Fish avoidance of key feeding areas (e.g. Tripp Seamount) Reduction in fish catch and increased fishing effort Toxicity and bioaccumulation effects on marine fauna Discharge of cuttings and drilling fluid Placement of wellhead on seafloor Well testing (optional for appraisal well only) Accumulation of cuttings on seafloor and sediment disturbance Increased hard substrate on seafloor Increase in air emissions and ambient lighting Discharge of produced water and local reduction in water quality Smothering of benthic fauna Toxicity and bioaccumulation effects on marine fauna Increased water turbidity and reduced light penetration Physiological effect on marine fauna Increase in benthic biodiversity and biomass Disorientation and mortality of marine birds Physiological effect on marine fauna Physiological effect on marine fauna

9 SLR Environmental Consulting (Namibia) (Pty) Ltd Page 3-9 Activity Phase Activity Aspect Potential Impact Abandonment of wellhead on seafloor Increased hard substrate on seafloor Obstruction to or damage of fishing gear Increased benthic biodiversity and biomass 3. Demobilisation Phase Drilling unit / support vessels leave drill site and transit to port or next destination Increase in underwater noise levels during transit Discharge of waste to sea (e.g. deck and machinery space drainage, sewage and galley wastes) and local reduction in water quality during transit Disturbance to marine fauna Physiological effect on marine fauna Increased food source for marine fauna Increased predator - prey interactions Dropped objects / Lost equipment Increased hard substrate on seafloor Physical damage to and mortality of benthic species / habitats Obstruction to or damage of fishing gear Loss of fuel from vessel accident Release of fuel into the sea and localised reduction in water quality Effect on faunal health (e.g. respiratory damage) or mortality (e.g. suffocation and poisoning) 4. Unplanned Activities Small instantaneous spills Discharge of fuel into sea during bunkering and localised reduction in water quality Discharge of hydraulic fluid into sea due to pipe rupture and localised reduction in water quality Effect on faunal health (e.g. respiratory damage) or mortality (e.g. suffocation and poisoning) Effect on faunal health (e.g. respiratory damage) or mortality (e.g. suffocation and poisoning) Effect on faunal health (e.g. respiratory damage) or mortality (e.g. suffocation and poisoning) Loss of well control / well blowout Uncontrolled release of oil / gas from well Smothering of coastal habitats Reduced fishing grounds and increased fishing effort Reduced catch

10 SLR Environmental Consulting (Namibia) (Pty) Ltd Page IMPACT ASSESSMENT PHASE Specialist Studies To address the key issues identified during the Scoping Phase five specialist studies were undertaken: Drill Cuttings and Oil Spill Modelling (see Appendix 4.1); Noise Assessment (see Appendix 4.2); Marine and Coastal Ecology Assessment (see Appendix 4.3); Commercial Fisheries Assessment (see Appendix 4.4); and Socio-Economic Assessment (see Appendix 4.5). Drill cuttings and oil spill modelling used metocean data available for the area of interest to model the extent and concentration of various discharge scenarios (including drilling cuttings and hydrocarbon spills). This study provided supporting information for use in the Marine and Coastal Ecology Assessment, Commercial Fisheries Assessment and Socio-Economic Assessment. A noise specialist assessed the potential impact related to drilling noise. This assessment characterised the likely background noise levels in the area of interest, quantified the noise levels of the different activities involved in exploration drilling and determined the noise profile and noise transmission loss between the drill site and Tripp Seamount. This information was used as an input by the marine ecology and fisheries specialists. The Marine Ecology, Commercial Fisheries and the Socio-Economic Assessment each describe their respective baseline receiving environments, identify and assess environmental impacts that may occur as a result of the proposed project (according to a pre-defined method for impact prediction and significance determination see Appendix 5), and recommend appropriate mitigation enhancement measures Compilation and Review of Draft EIA Report and EMP A Draft EIA Report and EMP was prepared in compliance with Section 15(2) of the EIA Regulations 2012 and was distributed for a 30-day review and comment period from 9 November to 8. Steps undertaken during this phase are summarised in Box 3-3 and all supporting information is presented in appendices to this report. Two written submissions were received during the Draft EIA Report and EMP review and comment period (see Appendix 2.5). Responses to these submissions are provided in the Comments and Responses Report (see Appendix 2.6). Box 3-3: Tasks undertaken during the Draft EIA Report and EMP review and comment period Availability of Draft EIA Report and EMP Copies of the Draft EIA Report and EMP were made available on the SLR website and at the Walvis Bay, Swakopmund and Lüderitz public libraries for the duration of the review and comment period (9 November to 8 ). I&AP notification Notification letters were ed to all I&APs registered on the project database. The letter informed them of the release of the Draft EIA Report and EMP, and where the report could be reviewed (see Appendix 2.2 for notification letters / s). To facilitate the commenting process, a copy of the Executive Summary (in English and Afrikaans) was attached to the .

11 SLR Environmental Consulting (Namibia) (Pty) Ltd Page 3-11 Box 3-3 cont. Advertisements Advertisements announcing the release of the Draft EIA Report and EMP for the 30-day comment and review period were placed in The Namibian (English) and the Republikein (Afrikaans) on 9 November 2017 (see Appendix 2.3): Project information-feedback sessions Key stakeholders were invited to attend two project information-feedback sessions held during the review and comment period. These sessions took the form of an open day format at which posters were displayed (see Appendix 2.4 for a copy of the posters and attendance registers) and members of the project team and Shell were available for discussion purposes and to answer questions. The two sessions were as follows: > 4 (16h00 18h00): Feedback session with invited Fishing Associations in Walvis Bay. > 5 (9h00 11h00): Feedback session with invited MFMR officials and Environmental NGOs in Swakopmund Compilation of Final EIA Report and EMP The Final EIA Report and EMP has also been prepared in compliance with Section 15(2) of the EIA Regulations 2012 (see Table 3-3). The specialist studies and other relevant information / assessments have been integrated into this report. This report has also been informed by I&AP comments received on the draft report (as noted in Section above). Table 3-3: Requirements of an EIA Report in terms of the EIA Regulations 2012 Section 15 (2) Content of EIA Report and EMP Completed (Y/N or N/A) Section in this report (a) The curriculum vitae of the EAP who compiled the report; Y Appendix 1 (b) (c) (d) (e) (f) (g) A detailed description of the proposed listed activity; A description of the environment that may be affected by the activity and the manner in which the physical, biological, social, economic and cultural aspects of the environment may be affected by the proposed activity; A description of the need and desirability of the proposed listed activity and identified potential alternatives to the proposed listed activity, including advantages and disadvantages that the proposed activity or alternatives may have on the environment and the community that may be affected by the activity; An indication of the methodology used in determining the significance of potential effects; A description and comparative assessment of all alternatives identified during the assessment process; A description of all environmental issues that were identified during the assessment process, an assessment of the significance of each issue and an indication of the extent to which the issue could be addressed by the adoption of mitigation measures; Y Y Y Table 2-1 & Chapter 4 Chapters 5, 6 & 7 Sections 2.1, 4.9, & 10.3 Y Appendix 5 Y Chapters 6 & 7; Section 10.3 Y Chapters 6 & 7

12 SLR Environmental Consulting (Namibia) (Pty) Ltd Page 3-12 Section 15 (2) (h) (i) (j) (k) Content of EIA Report and EMP An assessment of each identified potentially significant effect, including: Completed (Y/N or N/A) Section in this report (aa) cumulative effects; Y Section 6.3 (bb) (cc) (dd) (ee) (ff) (gg) the nature of the effects; the extent and duration of the effects; the probability of the effects occurring; the degree to which the effects can be reversed; the degree to which the effects may cause irreplaceable loss of resources; and the degree to which the effects can be mitigated; A description of any assumptions, uncertainties and gaps in knowledge; An opinion as to whether the proposed listed activity must or may not be authorised, and if the opinion is that it must be authorised, any conditions that must be made in respect of that authorisation; and A non-technical summary of the information. Y Chapters 6 & 7 Y Section 3.1 Y Section 10.4 Y Executive Summary