(20 April, 2016 Tsagaannuur Soum of Selenge aimag)

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1 The Public Consultations on the draft Terms of Reference /TORs/ for Regional Environmental Assessment /REA/ and Environmental and SocialImpact Assessment /ESIA/ for Shuren Hydropower Plant Project / SHPP/ (20 April, 2016 Tsagaannuur Soum of Selenge aimag) The objectives of the Response Matrix: This matrix captures feedback and inputs received through the public consultations on the draft Terms of Reference (ToRs) for the Regional Environmental Assessment and Environmental and Social Impact Assessment (ESIA) for Shuren Hydropower Plant Project. The consultation meeting was held on 18 April 2016 in Tsagaannuur Soum of Selenge aimag with the potentially affected stakeholders. A period of time provided for receipt of written feedback. As a result of the consultation process, significant revisions have been made to the ToRs including extension of the timeframe, identification of additional technical considerations and due diligence provisions. The aim of the matrix is to explain how comments and suggestions provided on the publically disclosed ToRs have been taken into consideration in the drafting process, and where not possible, to explain why. All comments have been reproduced in the matrix without attribution in order to preserve anonymity and promote impartial review. KEY QUESTIONS KEY COMMENTS RESPONSES BY MINIS SHUREN LLC 1 To preserve the ecological balance of the region in doing the project- related activities and consider it in the ESIA TORs; 2 Our company owned cropland is located all along the river that could be entirely covered by the reservoir. In this case, how these issues shall be solved? What shall we do about it at this stage? It has been considered in Section 3.3 of the draft EISA TORs; The Resettlement section in Annex 3 of draft ESIA TORs state that the ESIA will assess the extent and nature of land and assets to be lost identify any restrictions or preclusions of access to land and resources and will stipulate specific needs both for the physical resettlement and/or economic rehabilitation of 1 P a g e

2 URGATSIIIN KHISHIG LLC 3 To improve the involvement of the local communities in carrying out the project related studies and include it the ESIA TORs; 4 In addition to the above question, are the territory of Atag Bag and its downstream sides included to be covered with water? ATARNUUR LLC 5 To consider about the fish breeding options in the ESIA TORs; 6 1.To consider the scope of hydropower utilizations; 2. The potential ecological changes in downstream side of proposed dam shall be considered in the TORs; 7 To take into account the potential negative impacts on livestock in the TORs; project-affected people to be addressed by means of a Resettlement Plan. It is considered as stated in Section 3.6 Public Consultation Plan and in Section 3.7 Information Disclosure to the Public of the draft ESIA TORs. /Pages / Section of Land Use in Annex of the draft ESIA TORs includes that the project area, particularly in areas affected by the project, identify the type of the current land management and land use, accompanied by an appropriate scale mapping. /Page 55 / Section of Fish Habitat and Breeding in Annex 3 of the draft ESIA TORs considers it. /Page 53 / 1) Chapter 5 of Pre- Feasibility studies considers the potential scope of hydropower utilizations, 2) Section of Environmental Impact of the Shuren HPP on Downstream areas in Annex 3 of the draft ESIA TORs considers the potential ecological changes in downstream side of proposed dam. /Page 54/ Section of Indigenous peoples in 3.4 of draft ESIA TORs reflects that the potential positive and negative impacts could be caused to 2 P a g e

3 8 Herders views, comments and concerns about project are to be captured and considered in the TORs; 9 To consider the potential job creation for the local residents and reflect out it in the ESIA TORs; 10 In these days, the subject of production of renewable electricity is being widely discussed. The option of hydropower plant is very useful compared to the other alternatives. We have been discussing the building of Shuren HPP almost for over 40 years in the past. It did not work out until today. Now, you are discussing it with us again. With what faith, you are studying this project which was unable to be implemented for last 40 years?how sure you are about the study of 24 months would change anything? The election is coming and everyone talks optimistic future, but with this unstable politics and current economic condition, we Indigenous peoples as results of project will be assessed. /Pages / It is considered as stated in Section 3.6 Public Consultation Plan and in Section 3.7 Information Disclosure to the Public of the draft ESIA TORs. /Pages 19-20/ Section of Incorporation of Suggestions by Stakeholders in 3.8 of ESIA TORs considers these comments. /Page 21 / Section B 10.3 of FS TORs state that the Consultant Team shall identify the potential number of employees and the structure management to ensure the construction activities of the proposed HPP. Chapter 9: Investment Analysis in Pre- Feasibility Studies explains about the potential investment for the planned HPP. /Page 9-3/ 3 P a g e

4 have concern that the study may be just waste of time and money since there are many upsetting incidents happened to other similar projects. Building up new road in our region was discussed a lot last year. We were so happy about it. But, did not work out and people of Tsgaannur were so upset and disappointed and lost our faith in the projects. I see that the proposed project will increase the further generation of electricity supply of the country which is good for the increasing power demand. But, I want to ask you how have the Dorgon and Taishir HPP s been beneficial over years since they were built up? Could they ensure local electricity demand? I just surprised that how can you think about you could do this important studies in this current unstable condition or are you just wasting money that was lent from the International development association? I would like you to respond us clearly to these questions. CITIZEN REPRESENTATIVE MEETING 11 We clearly understand about the benefits of the hydropower plants. The important is 1) to assess the potential adverse environmental and social impacts of the proposed project. 2) Need to estimate the potential risks and develop the mitigation measures. Include these in the ESIA TORs; 1) Section of Indigenous Peoples under the subject of 3.4 Key Social Issues of the draft ESIA TORs considers Assessment, based on free, prior, and informed consultation, with the affected Indigenous Peoples communities, of the potential adverse and positive effects of the project on indigenous peoples. /Page 18/ 2) Within the framework of the detailed 4 P a g e

5 12 1) Is there any specific plan for the fish migration? 2) Have the ESIA TOR studied the natural flora and fauna including wild fruits that are collected every year by the locals? 13 From your speech, it is understood that only the local people those who live the impact zone, but people those who live in the soum center are impacted too. Also, it looks like the most fertile area with rich natural reserves will be impacted. The local residents of the soum center pick up the wild fruits and sell them for living. Consider if it will be impacted in the TORs; 14 1) Does the ESIA TOR study any wild animals and 2) the benefits from hunting for the local communities? ESIA, Mitigation plan will be developed and applied. /Page 12/ 1)Section 3.3 of the draft ESIA TORs will consider the fish migration issues /Page 14 / 2) Section Indigenous Peoples in 3.4 under the subject of Key Social Issues of the draft ESIA TORs state that to assess the vulnerabilities of and risks to indigenous peoples communities from the project, given their close ties to natural resources. /Page 17-18/ Section Indigenous Peoples in 3.4 under the subject of Key Social Issues of the draft ESIA TORs state that to assess the vulnerabilities of and risks to indigenous people s communities from the project, given their close ties to natural resources. /Page 17-18/ 1) Section of Fauna in Annex 1 of the draft ESIA TORs considers the studies of wild animals. /Page 42 of the draft ESIA TORs; 2) Section Indigenous Peoples in 3.4 under the subject of Key Social Issues of the draft ESIA TORs state that to assess the 5 P a g e

6 15 Tsagaannuur soum area is in the earthquake zone. Does the ESIA or FS TOR include this issue? DEPUTY GOVERNOR 16 According to the pre-feasibility study, 80% of the Atar unit will be flooded. But we already started registering land ownership, some including the Atar bag area. 1)Carefully consider to keep Atar Bag as the current settlement; 2)Highly consider constructing a smallscale dam to protect Atar Bag from the reservoir to be built; ( from flooding); 3)To consider to solve the irrigation issues from the lake ; vulnerabilities of and risks to indigenous peoples communities from the project, given their close ties to natural resources. /Page 17-18/ Section B 3.3 of FS TORs reflects conducting Seismic Analysis, /Page 17 of the draft FS TORs/ 1)Section of Land Use in Annex 3 of the draft ESIA TORs will consider the keeping Atar bag as settlement itself now. /Page 55/ 1) Will be considered building a small-scale of dam to protect the Atar bag from flooding in the phase of carrying out the detailed Feasibility Studies. 2) It is possible to study it in the phase of the detailed ESIA. 17 We understood that ESIA will be conducted for 2 more years. How long the construction process would continue? 18 Are the people of Atar bag and Tsagaannuur soum going to be employed during the Consider all these in the TORs; Although Section B10.2 of draft FS TORs includes about implementation phases of the project, specific timeframe has been included. /Page 28/ Section B 10.3 of FS TORs state that the Consultant Team shall identify the potential 6 P a g e

7 construction phase of the planned dam and reservoir? 19 How you solve the infrastructure issues? The government is planning to build up 115km road from Shaamar to Tsagaannuur. What are the planned road routines within the scopes of the proposed project? It is from Erdenet through Khyalganat and to Tsagaannuur or from Darkhan through Khyalganat and to Tsagaannuur? What are the intended options? 20 What would be the potential cost for unit of electricity as a resut of the construction of HPP? What are the benefits to local residents? URGATSIIN KHISHIG LLC 21 1) Agricultural areas are irrigated between June to August by the Tsuutsiin Hoh Well is located beyond the Atar Bag. It might be flooded with water. Consider it in the ESIA TORs; 2)It is Atar Bag should not be impacted by project activities and not be covered with water; in order not to happen it, consider constructing small-scale of water valve to protect Atar Bag from the reservoir to be built; LOCAL SOUM RESIDENT: 22 Some of the special protected areas of Khan Buteel have been included as impact zone. Consider it in the ESIA number of employees and the structure management to ensure the construction activities of the proposed HPP. Section B 7.6 of the draft FS TORs considers Infrastructure and planned roads. Chapter 9: Investment Analysis in Pre- Feasibility Studies explains about the potential investment for the planned HPP. 1) Will be considered in the phase of carrying out the detailed Feasibility Studies. 2) It is possible to study it in the phase of the detailed ESIA. Section of Land Use in Annex 3 of the draft EISA TORs states that if the project is implemented in the territory of the state or 7 P a g e

8 TORs; local protected areas assess their value and disclose information about the location and the area of the protection regime, accompanied by an appropriate scale mapping. /Page 55/ 23 What stage is the Eg HPP project going? Contact to Eg HPP PMU 24 The psychological calm of residents, entities and other communities shall be disturbed by the project relatedactivities; 25 How the roads which are connected to the northern portion of Mongolia will be improved if the project proceeds in future? 26 How the proposed project will negatively impact on the agriculture and livestock? Adverse potential impacts on wildlife, water resources, fauna and flora shall be reflected in the ToRs of the ESIA; 27 Global warming issue is becoming serious topic. Will proposed project negatively effect on the micro-climate condition? Or may be positively? How it will impact on agriculture and livestock in the region? 28 To include about how the indigenous peoples receive the benefits from the project implementation in the TORs; Section Indigenous Peoples in 3.4 under the subject of Key Social Issues of the draft ESIA TORs state that to assess the vulnerabilities of and risks to indigenous people s communities from the project. /Page 17-18/ Section B 7.6 of the draft FS TORs considers Infrastructure and planned roads. Section 3.3 of the draft ESIA TORs considers the potential impacts on wildlife, water resources, fauna and flora. /Page / Section 3.4 of the draft ESIA TORs considers the potential social impacts /Page 57 / Section of Micro climate change impact assessment in Annex 1 of the draft ESIA TORs considers question 27. /Page 44 / Section 3.4 Key Social Issues of the draft ESIA TORs states that to develop plan actions to ensure indigenous peoples receive culturally appropriate benefits under the 8 P a g e

9 project. /Page 18/ 29 Currently, what phase of the study are you in? Currently, TORs for ESIA is being developed. Timeframe of the EISA will take 24 months 30 Are you planning to create the settlement for the utilization of HPP? HERDER OF KHANTAI BAG 2 ND BAG 31 Building up the hydropower plan is necessary. To study the potential adverse environmental and social impacts of the proposed project. Include these in the ESIA TORs; 32 Well explain the potential environmental and social impacts could be caused by the project related activities to the local communities; This will be determined as results of the studies. Section 3.3 Key Environmental Issues of the draft ESIA TORs considers the potential negative impacts./page 12-16/ Section 3.4 Key Social Issues of the draft ESIA TORs considers the potential social impacts. /Page 16-18/ It is being considered as stated in Section 3.6 Public Consultation Plan and in Section 3.7 Information Disclosure to the Public of the draft ESIA TORs. /Pages 19-20/ 33 The land acquisition is not available anymore in here. All of land is owned. How do you solve this issue? Is compensation planned? URGATSIIN KHISHIG LLC 34 What will the approximate capacity of the Shuren HPP be? Is it really beneficial to the We truly want to keep the cropping area not to be included in the impact zone of Section of Land Use in Annex 3 of the draft ESIA TORs consider question 33. /Page 55/ Section Indigenous Peoples in 3.4 of the draft ESIA TORs considers the compensation issues. /Page 17/ Section B 7.6 of the draft FS TORs considers Infrastructure and planned roads. 9 P a g e

10 country? it will damage the ecosystem of large size of land with a rich in natural resources. Also, the cost of the construction of HPP is a relatively high. How the costs that have been spent on the project implementation going to be recovered? Could the government provide energy supply for us at cheaper price than we paying now? Could it be more profitable than supplying the energy from Russia? this project. If included, please keep the Atar bag from the flooding by building up protection facility; 35 Consider to construct the planned road through the Tsagaannuur soum center in the TORs; Keeping Atar bag is possible to be considered in the phase of the detailed FS. Section B 7.6 of the draft FS TORs considers Infrastructure and planned roads. It may be a not good idea to construct high voltages and roads through high mountains. If it so, several people of Atar bag will use this. If these will be constructed through our Tsagaannuur soum, it could be economically beneficial and reasonable solution as well as it will cost cheaper price; 36 Would HPP freeze in winter? Section of Impact from water and infrastructure building and Facilities in Annex 3 of the draft ESIA TORs states that the oxygen rate should be measured in the Serenge river and identify for the future reservoir with or without ice cover./page 55 / LOCAL SOUM RESIDENT 37 What s the capacity of Shuren HPP? Is it useful? PFS Page 8 states that the potential capacity of the planned Shuren HPP is 300 WBt. 38 It looks like a large area will be affected and a Chapter 9: Investment Analysis in Pre- 10 P a g e

11 large amount of natural reserves will be damaged as well as ecosystem of region will be impacted. In addition, cost of the construction is relatively high. How do you recover expenditure that was spent for the whole project activities? 39 Can the Shuren HPP supply electricity at cheaper price than we are paying now? Can it be more economically beneficial than supplying the electricity from Russian Republic? RIVER WITHOUT BOUNDARY NGO 40 Would it freeze in the downstream? How much area will be covered by ice in the downstream? What types of impacts it will cause? are these issues included in the TORs? LOCAL SOUM RESIDENT 41 Global warming and desertification is becoming serious issue in worldwide. I have heard that some studies found out that the rivers Orkhon and Selenge will shrink and become little stream by the time of The desertification is occurring in the central region of Mongolia besides the Gobi region. How the planned HPP going to potentially impact on water resources for next 20, 30 and 40 years? 42 How long will the HPP be used? Are there any studies about it? 43 From the map shown, large areas with a very fertile soil have been included. Will ESIA TORs study the soil condition in the area? Feasibility Studies explains about the potential investment for the planned HPP. Chapter 9: Investment Analysis in Pre- Feasibility Studies explains about the potential investment for the planned HPP. Section Surface and ground water in Annex1 of the draft ESIA TORs states that the ice cover will be described and the impact of the power plant on the ice cover downstream has to be documented. /Page 40 / Section Surface and groundwater in Annex1 of the draft ESIA TORs considers question 41. /Page 40 / PFS states that the utilization period of the planned HPP is 50 years. Section of Soil and Vegetation Cover in Annex 1 of the draft ESIA TORs will consider this question. 11 P a g e

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