SPC-EU EDF10 Deep Sea Minerals (DSM) Project

Transcription

1 EUROPEAN UNION SPC-EU EDF10 Deep Sea Minerals (DSM) Project 2015 Progress Report 1 st January 30 th June 2015 Mr Leonard Drynan of Cardno during a DSM Deep Sea Mining Cost-Benefit Analysis stakeholder consultation with staff of the Mineral Resources Authority (MRA) in Port Moresby PNG 1

2 Prepared by: Akuila K. Tawake Geoscience Division Secretariat of the Pacific Community November 2015 IMPORTANT NOTICE This report has been produced with the financial assistance of the European Union. The views expressed herein do not necessarily reflect the official opinion of the European Union. More copies of this report can be obtained from the address below: Applied Geoscience and Technology Division (AGTD) Secretariat of the Pacific Community (SPC) Private Mail Bag GPO, Suva FIJI ISLANDS Phone: Fax:

3 CONTENTS LIST OF ACRONYMS... 4 EXECUTIVE SUMMARY INTRODUCTION Project Staff Recruitment KEY RESULT AREA 2: Formulation of National Deep Seabed Minerals Policy, Legislation and Regulations Development of National Legal Instruments Summary of Policy and Legislation Development KEY RESULT AREA 3: Strengthened and increased national capacities Regional Training Workshops Rhodes Academy Training Project Internship Scheme Communications Internship Regional DSM Financial Framework Information Sharing and Awareness KEY RESULT AREA 4: Effective management and mechanisms for the monitoring of offshore exploration and mining operations Cost-Benefit Analysis for Deep Seabed Mining in the Pacific Regional Deep Sea Minerals Scientific Research Guidelines Regional DSM Environmental Management Framework nd GEOSCIENCE STEERING GROUP MEETING PARTNERSHIP WITH JICA CHALLENGES SUSTAINABILITY AND OWNERSHIP COMMUNICATION AND VISIBILITY th PROJECT STEERING COMMITTEE MEETING PROJECT MID-TERM EVALUATION CONSULTANTS WORK PLAN AND BUDGET PROJECT LOGICAL FRAMEWORK

4 LIST OF ACRONYMS ACP AG BA CBA CEO CRC CRGA CSO DSM DSMSR EDF10 EEZ EIS EU FAME FNU FSM GIS GSD GSG IMF INSMB ISA JICA KRA LLB MFMRD MLSNR MNRE MoU MRD MREL MTE NGO NIWA African-Caribbean-Pacific Group of Countries Attorney General Bachelor of Arts Cost-Benefit Analysis Chief Executive Officer Cobalt-rich Crusts Committee of Representatives of Governments and Administrations of SPC Civil Society Organisation Deep Sea Minerals Deep Sea Minerals Scientific Research 10 th European Development Fund Exclusive Economic Zone Environmental Impact Statement European Union Fisheries Aquaculture and Marine Ecosystem Division of SPC Fiji National University Federated States of Micronesia Geographical Information System Geoscience Division, SPC Geoscience Steering Group International Monetary Fund Interim National Seabed Minerals Management Board, RMI International Seabed Authority Japan International Cooperation Agency Key Result Area Bachelor of Laws Ministry of Fisheries and Marine Resources Development, Kiribati Ministry of Lands, Survey and Natural Resources, Tonga Ministry of Natural Resources and Environment, Samoa Memorandum of Understanding Mineral Resources Department, Fiji Marawa Research and Exploration Limited Mid-Term Evaluation Non-Governmental Organisation National Institute of Water and Atmospheric Research 4

5 NMI NOMC PDLP PFTAC PICs PICTs PIFS PNA PNG REE REMF RLRF RMI RMMD ROM SBMA SMS SOE SPC SPREP STAR TIS ToR UNCLOS UNEP USGS USP Nautilus Minerals Incorporation National Offshore Minerals Committee Post-graduate Diploma in Legal Practice Pacific Financial and Technical Assistance Centre Pacific Island Countries Pacific Island Countries and Territories Pacific Islands Forum Secretariat Parties to the Nauru Agreement Papua New Guinea Rare Earth Elements Regional Environmental Management Framework Pacific ACP States Regional Legislative and Regulatory Framework for Deep Sea Minerals Exploration and Exploitation Republic of the Marshall Islands Regional Marine Minerals Database Result Oriented Monitoring Seabed Minerals Authority, Cook Islands Seafloor Massive Sulphides State-owned Enterprise Secretariat of the Pacific Community Secretariat of the Pacific Regional Environment Programme Science, Technology and Resources Network Te Upukarea Society Terms of Reference United Nations Convention on the Law of the Sea United Nations Environment Programme United States Geological Survey University of the South Pacific 5

6 EXECUTIVE SUMMARY This year is the fifth year in which the Geoscience Division (GSD) of the Secretariat of the Pacific Community (SPC) has been implementing the European Union (EU) funded Deep Sea Minerals (DSM) Project (referred to herein after as the Project ). This report highlights the Project activities and deliverables in the first six month of A number of project activities were initiated in the first six months of the year including the completion of the first draft of the Regional DSM Agreement, the Cost Benefit Analysis (CBA) of deep sea mining in the Pacific, the Project steering committee meeting, and the regional training workshop on policy formulation and legislation drafting. In addition, the development of national legal instruments by which the Project has been providing legal advice and drafting assistance to a number of countries as well as incountry DSM activities are highlighted in this report. With the Project s assistance, the Government of Nauru has reviewed and finalised its International Seabed Minerals Bill in the first half of The Bill is expected to be table in parliament later in the year. At the request of the Government of Kiribati, the Project drafted the following three national DSM legislation: (i) legislation for DSM within national jurisdiction; (ii) legislation for Kiribati s DSM interest in the Area; and (iii) legislation for DSM in both national jurisdiction and the Area. The three draft legislation were completed and sent to the Kiribati Government in March The Project assisted the Government of Cook Islands in reviewing the Seabed Minerals Licensing Regulations and Environmental Regulations during the reporting period. These regulations are expected to be approved by cabinet and tabled in parliament in late Additionally, public consultations on the draft RMI DSM Policy and Law were carried out in Majuro and Ebeye in April. The Project provided technical and financial support to these national consultations. After the enactment of the principal DSM legislation in Tonga and Tuvalu in 2014, both governments have embarked on drafting their respective Seabed Minerals Licensing Regulations. Both national licensing regulations were reviewed by the Project. Capacity building initiatives continue to be one of the Project s priorities. In addition to the five regional training workshops that we held between 2012 and 2014, a training workshop on DSM Policy Formulation and Legislative Drafting was held in Apia Samoa in May this year. In consultation with key in-country stakeholders, it was decided that policy makers and legal drafters in the region need to be trained on the legal aspects of DSM that would facilitate policy and legislation development in many countries. Further, the Project provided support for other capacity building initiatives including the internship scheme, short-term attachments / trainings at various institutions. A Cost-Benefit Analysis (CBA) of deep sea mining in the Pacific was initiated by the Project in January this year and the Contract Agreement was awarded to Cardno. The objective of the CBA is to deliver a socio-economic (cost benefit) analysis of deep sea mining in the Pacific with a view to informing government decisions, and the sustainable management and optimisation of the activity in the future. The CBA is being carried out on the following three case studies: SMS mining at the Solwara 1 Project site in PNG; Manganese nodules mining in the Cook Islands; and CRC mining in RMI. Cardno has assigned two resource economists to be responsible for the CBA Dr Kelley Myers as the Project Manager, and Mr Leonard Drynan the Deputy Project Manager. They 6

7 visited GSD as well as PNG, Cook Islands and between March and April to consult with the Project team and stakeholders and to collect additional data and information. The first draft of the CBA report was received by the Project Team Leader in June and the draft report was circulated to relevant staff at GSD to be reviewed As part of the Project s ongoing information sharing and awareness programmes in Pacific Island Countries (PICs), a number of events was organised to ensure that in-country stakeholders are better informed on DSM issues. This involved sharing communication materials such as press releases, videos, newsletters and information brochures though communication technology and during any Project events. The Project provided technical and funding support for in-country DSM events in Tonga, Solomon Islands, and Kiribati during the reporting period. Three regional frameworks/guidelines were either developed or reviewed during the first half of 2015 period. These are: (i) Pacific Island Countries and Territories Regional Fiscal and Revenue Management Framework for Deep Sea Mineral Activities ; (ii) Regional Deep Sea Minerals Scientific Research Guidelines; and (iii) Regional Environment Management Framework (REMF) for Deep Sea Minerals Exploration and Exploitation. All three Frameworks are expected to be extensively reviewed and finalised in the second half of In response to a number of challenges/risks associated with the implementation of the Project, a number of mitigating measures have implemented in the last year and have been proven to be effective. These include continuous engagement with senior government officials and key incountry stakeholders to facilitate the development of DSM policy and legislation, increasing the number of regional training workshops to fill knowledge gaps and facilitate deliberations among various stakeholders, engaging fisheries Experts to shed more light on the likely/unlikely impacts of DSM activities on fisheries, providing a forum to openly share relevant DSM information and discuss DSM issues with CSOs. As part of the Project s sustainability initiative, Pacific ACP States are encouraged and trained to ensure the long term sustainability of revenue and benefits emanating from any deep sea mining projects. As a consequence of the Project s advocacy on prudent revenue management and the establishment of national saving schemes, a number of countries have developed (e.g. Cook Islands) or are in the process of developing (Tonga and PNG) relevant policy and legislation that will ensure that mining revenues are proper utilised and a portion is saved / invested for future generations. Lastly, the 6 th DSM Project Steering Committee meeting was held in Nadi Fiji in April Apart from Palau and Niue, thirteen of the fifteen participating countries of the Project were represented during the meeting. Also in attendance were Messrs Jerome Pons and Albert Cerelala, the officers in charge of the Project at the European Union Delegation for the Pacific in Suva. Mr Scott Roger of PFTAC also attended the meeting and presented the draft Regional Financial Framework that has been jointly developed by PFTAC and SPC through the Project. 7

8 1. INTRODUCTION The Geoscience Division (GSD) of SPC through the Project continued to implement activities in accordance with the project scope and priorities of Pacific ACP States in the first six months of With the lapse of the Project implementing period in March 2016, efforts were dedicated on completing current project activities and initiating the remaining ones. One of the major deliverables of the Project, the Cost-Benefit Analysis (CBA) of Deep Sea Mining in the Pacific, was initiated in early 2015 and a significant amount of effort and resources were dedicated to this during the reporting period. During the annual Project steering committee meeting that was held in Nadi in April, the results of the Project s Mid-Term Evaluation (MTE) was presented to committee members. Many representatives of participating countries had expressed their appreciation for the Project assistance in providing technical, legal and financial assistance to in-country DSM activities as well as other Project initiatives. As usual, the Project continued to receive country requests in the first half of this year and the Project team members had to prioritise these activities in order to respond in a timely and effective manner. In regard to capacity building initiatives, the Project proposed to hold three regional training workshops in 2015 and the first one was held in May in Apia Samoa. Further, national public awareness and consultations had been supported by the Project in collaboration with government, NGOs and, where possible, the private sector. This inclusive and consultative approach allows open exchange of views and encourages stakeholder participation in discussing issues related to DSM. This approach has been embraced by a number of countries in the region and welcomed by development partners. Despite a number of ongoing challenges the Project continued to implement appropriate mitigating measures that have been proven to be effective. This report highlights project activities that were accomplished in the first six months of 2015 in accordance with the three remaining Key Result Areas of the Project Project Staff Recruitment Ms Annie Sing, the Project Legal Assistant, was on maternity leave between May and July. In her absence, Ms Nunia Vucukula (Figure 1) was recruited as a Legal Assistant to assist Marie with all the legal aspects of the Project during that period. Annie will resume duty in mid-july Figure 1: Ms Nunia Vucukula, Legal Assistant. Ms Marica Navulase was appointed as the Temporary Project Assistant at the beginning of 2015 and upon the expiry of her 1 Key Result Area 1: Development of Regional Legislative and Regulatory Framework for offshore minerals exploration and mining, was completed in 2012, see: 8

9 contract in May the position was advertised. At the end of the reporting period the recruitment process was completed and the position was offer to Ms Heilala Erenavula. Heilala was expected to join the Project team in mid-july. 2. KEY RESULT AREA 2: Formulation of National Deep Seabed Minerals Policy, Legislation and Regulations 2.1 Development of National Legal Instruments The Project continued to provide sound legal advice and drafting assistance to Pacific ACP States during the reporting period. Participating countries of the Project have recognised the significance of the legal drafting provided by SPC hence the countries have continued to request for the Project s assistance and they have been/will be assisted this year Establishment of a Community of Practice A community of practice will be established for Pacific Islands policy officers and legislative drafters involved with the deep sea minerals activities. Using advanced technology, the community of practice allows legal practitioners in PICs to virtually get-together and exchange practices, experiences, questions and challenges with regards to the development and implementation of their national deep sea mineral policies and legislation. This will enable practitioners to share and develop new ideas that will greatly enhance the legal capacity in PICs in developing robust DSM policies and legislations. The new virtual community will be facilitated through an online portal managed by the DSM Project, and will continue to enable dialogue between countries through online discussion forums after the DSM Project ends. The portal can be accessed via Kiribati Drafting DSM Legislation At the request of the Government of Kiribati through the Ministry of Fisheries and Marine Resources Development (MFMRD), the Project drafted the following three national DSM legislation for Kiribati: (i) legislation for DSM within national jurisdiction; (ii) legislation for Kiribati s DSM interest in the Area; and (iii) legislation for DSM in both national jurisdiction and the Area. These three draft legislation were completed and sent to MFMRD in March 2015 to be considered by government. Inter-government agency consultation was expected to commence thereafter to determine which model they would like to adopt. The Project was expected to provide further assistance in reviewing and finalising the legislation Cook Islands Review of DSM Regulations The Project Legal Advisor assisted the Government of Cook Islands in the final review of the Seabed Minerals Licensing Regulations and Environmental Regulations in early These regulations are expected to be approved by cabinet and tabled in parliament in late

10 In consultation with the Cook Islands Seabed Minerals Authority (SBMA), the Project Legal Advisor prepared a Memorandum of Understanding (MoU) for the recruitment of Ms Amelia Ponton (a former Legal Intern of the Project) as a SBMA Legal Counsel. Amelia will be funded by the Project to assist the SBMA in providing expert legal support and advice to ensure that appropriate and relevant legal and policy frameworks governing the DSM developments in the Cook Islands are in place. Additionally, she will provide drafting assistance on relevant legislation, licensing regulations, seabed prosecutions, negotiations and contracts. Amelia is expected to spend five months with the SBMA and she will commence work in July Nauru Review of DSM Legislation A review of the Nauru International Seabed Minerals Bill was undertaken by the Project Legal Adviser early this year. The Bill is expected to be tabled in Parliament in the second of Additionally, legal advice on DSM contract negotiations was provided to the Government of Nauru Republic of the Marshall Islands Public Consultations The Project Legal Advisor provided advice and assistance in organising the public consultations on the draft DSM Policy and Law. At the request of the Government on the Republic of the Marshall Islands (RMI), the Legal Advisor was part of the government team that conducted stakeholder consultations in Ebeye and Majuro in April Tonga Review of Licensing Regulations After the passing and subsequent enactment of the Tonga Seabed Minerals Act in 2014, the Government of Tonga embarked on the formulation of its Seabed Minerals Licensing Regulations. The Project reviewed the Licensing Regulations and sent it to relevant authorities in Tonga Tuvalu Review of Licensing Regulations Similarly, the Government of Tuvalu developed the draft Seabed Minerals Licensing Regulations after the enactment of its Seabed Minerals Act in late At the request of the Government of Tuvalu the Licensing Regulations was reviewed by the Project Legal Advisor Other Legal Assistance The Project continues to provide legal advice and assistance on request to Pacific ACP States during the reporting period. Project personnel have been involved in the review / preparation of other legal documents, and responding to ad hoc requests for legal advice from a number of countries. 2.2 Summary of Policy and Legislation Development A summary of the development status of national DSM policy, laws and regulations is shown in Table 1 below. 10

11 Table 1: Summary of national DSM policy and legislation development. Country DSM Policy DSM Law DSM Regulations Cook Islands FSM Yes Cook Islands Seabed Minerals Offshore Policy 2013 Yes: Enacted Seabed Minerals Act 2009 Yes: Presented to congress Fiji Under review Yes: International Seabed Minerals Management Decree 2013 Kiribati RMI Nauru Niue Palau Yes: Draft Offshore Minerals Policy under review Yes: With cabinet Yes: In draft Yes: Under internal consultations Yes: With cabinet Yes: Draft under review Yes: In draft Yes: Passed by Parliament Yes: In draft PNG Samoa Yes: Under review Yes: Under review Yes: Under Review Solomon Islands Timor Leste Yes: In draft Tonga Tuvalu Vanuatu Yes: In draft Yes: Under consultation Yes: Under consultation Yes: Seabed Minerals Act 2014 Yes: Seabed Minerals Act 2014 Yes: In draft Yes: In draft 3. KEY RESULT AREA 3: Strengthened and increased national capacities This KRA focuses on capacity building initiatives of the Project which include training workshops, internships, short term attachments and trainings, and attending relevant international conferences and meetings. In the first half of 2015 a number of capacity building initiatives were undertaken by the Project. Candidates representing Pacific ACP Sate governments, national and international NGOs, Pacific communities, and the private sector have benefited in which their knowledge relating to DSM have been enhanced. These events allow numerous opportunities for interaction 11

12 between participants and DSM Experts as well as the sharing of DSM information that fill knowledge that contribute informed decision making. 3.1 Regional Training Workshops Regional training workshops are considered as excellent fora whereby Experts are not only sharing new knowledge and ideas but also engaging in meaningful discussions with participants and building networks. By encouraging free and inclusive exchange of views on any DSM issues, representatives of governments, communities, civil societies and the privates sector have regarded this forum as an excellent model to emulate at the national level where genuine dialogue is happening and consensus can be reached. Apart from the five regional training workshops that were hosted by the Project between 2012 and 2014, three regional training workshops will be organised in Each of these workshops will have different thematic area as shown in Table 2 below: Table 2: 2015 DSM Regional Training Workshop information. Training Thematic Area Workshop Dates Host Agencies Workshop # 6 DSM Policy Formulation and Legislative 18 th 22 nd May SPC Drafting Development of Appropriate DSM Fiscal August 2015 SPC and PFTAC Regime and Revenue Management Options for Pacific ACP States 8 Environmental Management of DSM Activities October 2015 SPC A detail account of the 6 th Regional DSM Training Workshop is given below th Regional Training Workshop DSM Policy Formulation and Legislative Drafting The 6 th Regional DSM Training Workshop (Figure 2) was held in Apia Samoa on 18 th 22 nd May 2015 with the theme: DSM Policy Formulation and Legislative Drafting. This event was organised by SPC with the assistance of the Ministry of Natural Resources and Environment (MNRE) in Samoa. The workshop aimed at bringing together a policy advisor and a legislative drafter from each of the 15 Pacific ACP Countries to address issues and challenges they share with regards to the management of DSM activities. It also provided opportunities for participants to (i) increase their understanding and knowledge of the international legal regime for DSM activities, (ii) improve their policy formulation and legislative drafting skills, (iii) share and discuss different country s policy and law instruments, and (iv) foster the Pacific network of national officials involved in DSM policy and law development. Fifty government representatives from 12 Pacific ACP States attended this workshop. The countries (Cook Islands, Fiji, Kiribati, Nauru, Niue, Papua New Guinea, Republic of Marshall 12

13 Islands, Samoa, Solomon Islands, Tonga, Tuvalu and Vanuatu) presented their respective policy and legal status, together with their achievements in the DSM sector. Figure 2: Participants of the 6 th DSM regional training workshop that was held in Apia Samoa in May In addition to SPC technical and legal Experts, Mr Paul Hibberd was contracted as a trainer in Legal framework development and legislative drafting. Mr Hibberd is a Legal Expert in the Law of Sea and maritime affairs with 10 years of relevant work experience. In addition, country representatives also shared their experiences and challenges, and identified the strengths and weaknesses in existing DSM policies and legislation. They also discussed whether there was need for further development and changes to their current legal frameworks. Figure 3: Participants in session during the 6 th Regional DSM Training Workshop. 13

14 Workshop participants (Figure 3) agreed that having robust and effective regulatory frameworks in place before issuing exploration and mining licenses is crucial to the effective control and demarcation of power and decision making. As a result of the training workshop, participants were able to improve their skills in legislative drafting and policy formulation. A Certificate of Completion was handed to each participant at the end of the workshop. The workshop proceedings report is currently under review and will be distributed to participants once finalized. 3.2 Rhodes Academy Training Mr Kevin Chand (Figure 4), an Environmental Lawyer working for a private law firm (Siwatibau and Sloan) in Fiji was partially funded by the DSM Project to attend a three-week course on the UN Law of Sea and Ocean Policy at the Rhodes Academy in Greece in between June-July Kevin s application to be sponsored by the Project was supported by the Fiji Government. This initiative is part of the DSM Project training to strengthen Government capacity to support bestpractice management of DSM issues in the country. The Rhodes Academy of Oceans Law and Policy is an international collegial institution that runs a three week intensive course of study with lectures by leading jurists, practitioners, diplomats, scientists, and international lawyers from around the world. Figure 4: Mr Kevin Chand receiving his Diploma during the graduation ceremony. The course consisted of daily lectures as well as two workshops each week and it covered a variety of topics related to oceans law and policy. Topics included the fundamentals of the law of the sea (UNCLOS), fisheries and the marine environment, deep seabed mining, maritime boundaries, delimitation and disputes. 3.3 Project Internship Scheme The Project Internship scheme started rather slow in the first half of the year and could be attributed to the slow response from countries and the two Project lawyers were preparing for the 6 th DSM Regional Training Workshops. Initially this programme was focused solely on legal aspects of DSM where participants have received first-hand experience of the international law framework governing the deep sea minerals sector. The programme has been expanded to also include geology, environment, geographical information system (GIS), communications, and general internships. 14

15 3.3.1 Legal Internship Only one legal intern joined the Project s legal internship in the first six months of Mr Aldric Hipa (Figure 5) of Niue graduated with a Bachelor of Laws (LLB) degree from University of the South Pacific (USP) Emalus Campus in Vanuatu in December 2014 and joined the Project as part of his Professional Diploma in Legal Practice (PDLP). He spent 4 weeks at GSD and was assigned to conduct a legislative review of a participating country of the Project and also assisted in the preparation for the Policy Formulation and Legislative Drafting workshop. Figure 5: Mr Aldric Hipa, Legal Intern Environment Internship During the reporting period, two graduate environmentalists participated in the Project environment internship. Ms Nancy Defe of Solomon Islands and Naomi Coalala of Fiji have spent 3 months and 1 month respectively with the Project Environment Advisor. Figure 6: Ms Naomi Coalala, Environment Intern Naomi (Figure 6) graduated from the University of Porto in Portugal, with Masters in Environmental Science in She joined the Project as the 2 nd Environment Intern. During her internship her main tasks included providing content for the DSM Projects website, researching and drafting text for the Regional Environment Management Framework and began drafting a brochure on Cobaltrich Crusts (CRC) environments. Nancy (Figure 7) completed a Bachelor s degree in Environmental Studies from USP before joining the Project as the 3 rd Environment Intern in March this year. During her internship she conducted a literature review on deep sea mineral studies undertaken in the Solomon Islands. She also assisted with research for the Regional Environment Management Framework (REMF) for Deep Sea Mineral Activities, and the environmental information brochure on CRC. Figure 7: Ms Nancy Defe, Environment Intern 3.4 Communications Internship With the high demand of communicating and raising awareness on the Project objectives, activities and deliverables, it was necessary to have a dedicated communications person to be responsible for all Project communication and advocacy initiatives. Upon the guidance of the Project Team Leader and senior Project personnel, a Communications Intern was recruited to prepare press releases; coordinate the preparation, review and completion of other 15

16 communication materials such as information brochures, newsletters, documentaries and video chips; liaise with external partners and media outlets to advertise the Project communication materials; and consult regularly with the SPC Communications Director. Ms Keresi Nauwakarawa was the first Project Communications Intern and she was recruited in the September 2014 and continued till her contract ended in March this year. She worked closely with the Project Environment Advisor, Ms Alison Swaddling, on the DSM Project s public communications, such as media releases, brochures, website and newsletters. Ms Nauwakarawa attained a Certificate and Diploma from Fiji National University (FNU) in Media and Journalism and is currently pursuing a Bachelor s degree in Law at USP. Replacing Keresi as the Project Communications Intern was Ms Onorina Saukelo (Figure 8) and she commenced work with the Project at the end of March. Onorina was responsible for the preparation and publication of communication materials such as media releases, information brochures, newsletters, and documentaries, as well as updating the Project website. She graduated with a Bachelor of Arts (BA) Degree in Literature, Language and Journalism from USP in Figure 8: Ms Onorina Saukelo, Communications Intern A summary of the Project internship scheme is given in Table 3 below. Table 3: List of Project Interns who joined the Project between January June Name Country Duration Major Tasks Mr Aldric Hipa Niue 27/04 23/05/2015 Ms Naomi Coalala Ms Nancy Defe Ms Onorina Saukelo Fiji 27/01 31/03/2015 Solomon Islands 30/03 05/06/2015 Fiji 30/03 30/06/2015 Conducted a legislative review of a member country. Assisted in the preparation of the Legislative Drafting and Policy Formulation Training Workshop. Provided content for the Project website, researching and drafting text for the Regional Environment Management Framework, initial drafter of the Cobalt-Rich Crusts Brochure. Conducted literature review on deep sea minerals studies undertaken in the Solomon Islands and assisted with research for the Regional Environmental Framework (REMF) for Deep Sea Mineral Activities and an information brochure on Cobalt-Rich Crusts. Prepared and coordinated the publication of communication materials such as media releases, information brochures, newsletters, and 16

17 Ms Keresi Nauwakarawa Fiji 19/ /03/2015 documentaries, as well as updating the Project website. Coordinated the publication of the internship brochure, compiling of Prospect Newsletter, Editions of publications including brochures and other ad hoc works for the Project including website maintenance. More information about the Project internship scheme can be viewed on the Project website: Regional DSM Financial Framework The 1 st draft of the Pacific Island Countries and Territories (PICTs) Regional Fiscal and Revenue Management Framework for Deep Sea Mineral Activities was reviewed by the IMF Experts based on the Project team s comments. In April, the 2 nd draft of the Framework was sent to all 15 Pacific ACP States, and representatives of exploration companies, relevant Expert agencies and CSOs. Unfortunately no comments were received by June hence the 2 nd draft Framework was re-sent to all in-country focal points in June. This Framework is expected to be further reviewed during the 7 th Regional Training Workshop scheduled for August Information Sharing and Awareness As part of the Project s ongoing information sharing and awareness programmes in PICs, a number of events was organised to ensure that in-country stakeholders are better informed on DSM issues. This involved sharing communication materials such as press releases, videos, newsletters and information brochures though communication technology and during any Project events. The Project provided technical and funding support a number of in-country DSM events during the reporting period Tonga DSM Awareness The Natural Resource Division of the Ministry of Lands, Survey and Natural Resources (MLSNR) in Tonga s is implementing a DSM awareness program and has been ongoing since the beginning of This programme involves the broadcasting of the Project documentaries on the national TV station, production of short DSM videos narrated in Tongan, and DSM audios have also been produced and broadcasted in local radio stations. Additionally, Mr Taniela Kula, the Deputy Secretary Natural Resources Division had on numerous occasions been interviewed regarding DSM issues on TV and radio. These initiatives are effective ways of disseminating DSM information throughout the nation and is evident by the increased interest and questions on the prospects of minerals mining received from the public and news media. The Project provided funding to MLSNR in support of this national DSM awareness programme. 17

18 3.6.2 Kiribati DSM Awareness The Kiribati National Offshore Minerals Committee (NOMC) continued to implement DSM activities in Kiribati with funding support from the Project in the first half of One of the main activities was the DSM awareness programme in schools in Tarawa and the radio talkback show Solomon Islands Youth Debate With the financial support of the Project, the Government of the Solomon Islands held a national youth debate on DSM in June in Honiara. Debates are a very exciting way of engaging youths as it encourages students to conduct research and gain more knowledge on deep sea minerals, and it increases public understanding of the key issues being debated. There were fourteen debaters (Figure 9) chosen from nine high schools in Honiara. The debate training was conducted by Ms Teina Mackenzie, from the Te Ipukarea Society (TIS) in Cook Islands, two weeks prior to the debate. With her experience in organising the Cook Islands Youth Debate in 2013, Teina was selected and contracted by the Project to coordinate this event. More than 50 people attended the debate and the debater showed that they have excellent knowledge of DSM issues in the Solomon Islands and the Pacific. The judges were: Dr Jimmie Rodgers (former Director General of SPC), Sir Bruce Saunders (a board member of the Solomon Islands Chamber of Commerce), and Ms Rose Abana (CEO for the Chamber of Commerce). The debate was very competitive and after the final round Ms Patisha Del Wate, a Year-12 student from King George IV High School was announced the debated winner. The Project provided certificates and prize monies for each debater and the overall winner. Figure 9: Students who participated in the Solomon Islands National DSM Youth Debate showing their Certificate of Participation after the debate. 18

19 The event was also an excellent opportunity to show the DSM documentaries and share the Project information brochures, reports and newsletters. The DSM Project encourages its member countries to organise DSM debates as a mean to engage youths and local communities in DSM discussions. To date, the Project has supported DSM debates in Cook Islands, Fiji, Tonga and Solomon Islands Project Newsletter The Project newsletter, The Prospect, continues to cover the Project and in-country activities, as well as major project achievements, and DSM events worldwide. The idea behind the newsletter is to ensure that stakeholders throughout the region are kept informed on recent and planned Project activities and related issues in the region and beyond. The Issue 7 of the newsletter was prepared, reviewed and published in the first half of 2015 and the Issue 8 was compiled at the end of the June. The newsletter is published every quarter and distributed to all stakeholders in the Project s distribution list. The 7 th Issue (Figure 10) includes coverage on the launch of the of the Interim National Seabed Minerals Management Board (INSMB) in RMI; Vanuatu Government public consultations on the draft national DSM policy; the Timor Leste National DSM training; the proposed deep sea exploration by the Ocean Exploration Trust in 2017; and DSM conferences attended by DSM team such as the Potsdam Ocean Governance workshop and the Sydney Marine Bio-prospecting workshop. An update on the Project s internship scheme is also included in this Issue. Figure 10: The 7 th Issue of the Project quarterly newsletter The Prospect. The 8 th Issue covers the 6 th regional DSM training workshop; the DSM Community of Practice; the Solomon Islands DSM Youth Debate; the Cost Benefit Analysis of DSM in the Pacific; DSM consultations and awareness in Kiribati, RMI and Tonga; the new report on Kiribati Manganese Nodule resources; the 1 st Civil Society Organisation (CSO) Perspective on DSM; an update on the internship scheme; and a new video on Q&A with Prof Cindy Van Dover Other Initiatives The Project continued to deliver a number of public presentations on DSM during the reporting period including guest lectures at USP, the 2 nd Geoscience Steering Group (GSG) meeting that was held in Nadi Fiji in April 2015, and a number of international meetings and workshops. These were excellent opportunities to share DSM information, discuss collaboration opportunities with partners, and strengthen geo-resources related initiatives with Pacific ACP States. 19

20 4. KEY RESULT AREA 4: Effective management and mechanisms for the monitoring of offshore exploration and mining operations 4.1 Cost-Benefit Analysis for Deep Seabed Mining in the Pacific Background In recent years, Papua New Guinea (PNG), Solomon Islands, Vanuatu, Fiji and Tonga have issued exploration licences to exploration companies and three foreign companies are actively exploring within the Exclusive Economic Zones (EEZ) of these countries. Other countries such as Nauru, Tonga, and Kiribati have participated in DSM activities in the Area under contract with the International Seabed Authority (ISA), through partnerships with foreign or State-owned Enterprises (SOE). In 2014 the Cook Islands has become the fourth Pacific ACP State to participate in DSM activities in the Area following the approval of the Cook Islands Investment Corporation s application by the International Seabed Authority (ISA). In 2009, a feasibility study of a Seafloor Massive Sulphide (SMS) site known as Solwara 1 in the Bismarck Sea was completed by Nautilus Minerals Incorporation (NMI). This feasibility study documents including an Environmental Impact Study (EIS) report were submitted to the PNG Government as part of its mining lease application. In January 2011 the Government of PNG granted a DSM mining lease to NMI to extract SMS resources. Figure 11: An image of deep seabed mining technology configuration that are currently being manufactured to mine SMS deposits. Additionally, the Cook Islands has significant manganese nodule resources within its EEZ. The Seabed Minerals Authority (SBMA) of the Cook Islands has made significant progress in addressing various issues relating to DSM in collaboration with partners such as SPC through 20

21 the Project, the Commonwealth Secretariat and the International Monetary Fund (IMF). In addition scoping work for a Sovereign Wealth Fund has been completed for ensuring revenues from a potential nodule recovery operation is sustainably managed. Several seamounts that occur within the EEZ of the RMI are known to have contained Cobaltrich Crusts (CRC). Surveys and sampling of 13 seamounts (carried out between 1996 and 2005) have indicated strong CRC potential, representing a good resource potential for cobalt, nickel, platinum, Rare Earth Elements (REE) and possibly other metals. Further exploratory works are required to increase scientific and engineering knowledge that are required to determine the viability of CRC mining in RMI. A number of developed countries have not only been involved in DSM exploration but have also made significant progress in mining technology development. NMI is in the middle of constructing its seafloor mining production tools and the manufacturing of all its mining technologies is expected to be completed by the end of Deep sea mining (Figure 11) is yet to take place anywhere in the world so the actual impacts of the mining are yet to be determined. Nevertheless, it is important to understand the costs and benefits associated with deep sea mining that would help PICs to make informed decisions. In light of this, one of the key deliverables of the Project seeks to conduct a preliminary social Cost-Benefit Analysis (CBA) of deep sea mining in the Pacific Purpose of the CBA The objective of the CBA is to deliver a socio-economic (cost benefit) analysis of deep sea mining in the Pacific with a view to informing government decisions, and the sustainable management and optimisation of the activity in the future. The CBA is being carried out on the following three case studies: SMS mining at the Solwara 1 Project site in PNG; Manganese Nodules mining in the Cook Islands; CRC mining in RMI. The analysis is expected to form the foundation for informed decisions and management plans related to deep sea mining in the three case study countries, while providing general lessons learned for Government decisions and management at a broader regional and international level. As a consequence, the findings of the analysis will be reviewed made public and open for further validation as required over time CBA Activities A Request for Proposal for the CBA was advertised internationally as well as in the SPC website in December At the closure of the tender in January 2015, five bids were received and the tender evaluation committee met in early February to assess these bids. After the approval of the tender evaluation report, the CBA tender was awarded to Cardno. This was followed by the signing of the CBA contract between SPC and Cardno at the end of February. 21

22 Cardno is an integrated professional services provider, delivering a diverse range of services including emerging markets services, structural, geotechnical, civil and environmental engineering, survey and mapping, planning/project management and asset management services. Cardno has assigned two resource economists to be responsible for the CBA Dr Kelley Myers as the Project Manager, and Mr Leonard Drynan as the Deputy Project Manager. Figure 12: The 1 st draft CBA report. Dr Myers and Mr Drynan were at GSD in early March to consult with the Project team and collect additional data and information. Subsequently, they were accompanied by a Project team member to visit PNG, Cook Islands and RMI between March and April for stakeholder consultations and data gathering. The first draft of the CBA report (Figure 12) was received by the Project Team Leader in June and it was circulated to the Project team members and the two GSD resource Economists for review. The 2 nd draft of the CBA report is expected to be reviewed by relevant government agencies and stakeholders in the 15 participating countries of the Project in August and the report will be finalised in the last quarter of Regional Deep Sea Minerals Scientific Research Guidelines The Regional Deep Sea Minerals Scientific Research Guidelines (the Guidelines) had been extensively reviewed during the reporting period by both National Institute of Water and Atmospheric Research (NIWA) of New Zealand and SPC. It was decided that the two parts of the Guidelines (as reported in the 2014 annual report) to be merged as one document. The report Guidelines is expected to be further reviewed by international experts and Pacific ACP States representatives in the second half of The Project Environment Adviser is coordinating the review of the Guidelines. 4.3 Regional DSM Environmental Management Framework Upon the finalisation of the Term of Reference (ToR) for the formulation of the Regional Environment Management Framework (REMF) for Deep Sea Minerals Exploration and Exploitation in January this year, the Project Environment Adviser spent a significant amount of time in the first six months of 2015 in developing the Framework. The REMF is the regional DSM environment framework equivalent of the legal Regional Legislative and Regulatory Framework (RLRF) that was developed by the Project in consultation with the 15 ACP States and endorsed by the Forum Leaders in

23 The first draft REMF (Figure 13) was completed and circulated to all the Project team members for internal review in May. Considering the comments provided by the Project team, the draft REMF is expected to be revised and circulated to all the 15 Pacific ACP States and international experts for further review in the 3 rd quarter of The final review will be conducted during the 8 th Regional Training Workshop that is scheduled for October Figure 13: The draft Regional Environmental Management Framework nd GEOSCIENCE STEERING GROUP MEETING The 2 nd Geoscience Steering Group (GSG) meeting (Figure 14) organised by GSD was held soon after the Project Steering Committee meeting in April in Nadi Fiji. The main purposes of the meeting were to: (i) discuss geoscience issues facing the Pacific Islands region; (ii) strengthen regional cooperation; (iii) discuss/foster partnerships with Experts and development partners; and (iv) deliberate and agree on an Action Plan that needs to be addressed in the following year. Figure 14: Paricipants of the 2 nd Geoscience Steering Group in Nadi Fiji in April In support of the integration of DSM into the management of geo-resources in Pacific ACP States, the Project provided funding support for government representatives to attend this 3-23

24 day meeting. Apart from GSD staff and government officials, a number of Experts either selffunded or supported by GSD were in attendance. A significant outcome of the GSG meeting is the re-birth of the Science, Technology and Resources Network (STAR). Mr Mr Malakai Finau, the Director of Mineral Resources Department (MRD) in Fiji, has been elected as the Chairperson of STAR. 6. PARTNERSHIP WITH JICA The 2-year part time collaboration between the Project and JICA will end in October Two of the three Japan International Cooperation Agency (JICA) Experts (Mr Kiyoshi Kawasaki, and Mr Takumi Onuma) will join the Project between September and October for a month to review a number of regional DSM frameworks and guidelines and to attend the 8 th DSM Regional Training Workshop. 7. CHALLENGES In response to a number of challenges/risks associated with the implementation of the Project, a number of mitigating measures have been progressively implemented over the years and are proven to be effective. Listed in Table 4 below are the major challenges encountered during the four and a half years and how the Project has been responding to each of them in order to minimise their impacts. Table 4: List of challenges encountered by the Project with corresponding mitigating measures undertaken. Challenges 1. Lack of or delayed responses from some countries and the need to re-schedule planned activities. 2. Delayed deep sea mineral activities by exploration companies have affected the project capacity building schedule. 3. The campaign by a number of Civil Society Organizations (CSO) against the Project was Mitigating Measures (i) Consulted in-country focal points and relevant agencies representatives on how best to implement priority activities; (ii) regularly encourage in-country focal points and key stakeholders to plan and implement DSM activities; and (iii) assigned the Project Support Officer to keep following up with each country s focal point. (i) Negotiated alternative capacity building initiatives with other partners such as the USGS and ISA, Rhodes Academy, University of Hawaii; (ii) increased the number of regional training workshops to address knowledge gaps relating to DSM. Ongoing and persistent engagement with many CSO representatives in national and regional meetings and workshops (including training 24

25 not anticipated during the project design. 4. Prolonged in-country review process for national DSM legal instruments is anticipated. 5. High number of requests for legal advice and assistance, overwhelming the Legal Advisor s work capacity - and limited availability of Consultants competent in this new legal area. 6. Lack of expert advice on deep sea environment and fisheries has led countries to raise their concern about the potential impacts of deep sea mineral activities on the ocean living resources. workshops, and consultation and awareness meetings) to: (i) ensure that CSOs are part of the decision making process, and (ii) educate them on all aspects of DSM. A forum has been established to discuss DSM issues and share relevant information openly with most CSOs in the region. (i) Holding regular dialogue with key in-country counterparts in a number of countries to accelerate the development, review and endorsement / enactment of national DSM policy and law, and (ii) targeting higher level intervention (i.e. Minister and Secretary levels) to speed up the review process and enactment of law. (i) Recruitment of a Legal Assistant, to support the Legal Advisor s work and enable her to prioritise her time on substantive legal requests, (ii) creative use of legal consultants where possible: i.e. using lawyers with non-dsm experience but related expertise for set tasks under supervision, (iii) ongoing legal internship scheme to assist in the basic legal aspects of the Project. (i) engaged fisheries experts from the FAME Division of SPC, PNA Secretariat, and NIWA to participate in regional training workshops, and provide relevant advise on fisheries, (ii) a Project Environment Advisor has been recruited to provide appropriate advice, and relevant environmental data and information to Pacific ACP States, (iii) an independent study on the potential impacts of DSM activities on fisheries in the Pacific will be conducted in SUSTAINABILITY AND OWNERSHIP Representatives of the Pacific ACP States are strongly encouraged and trained to ensure the long term sustainability of revenue and benefits emanating from any deep sea mining projects. As highlighted in the 2013 ROM (Result Oriented Monitoring) report, sustainability of the benefits will depend on prudent use of revenue streams and in the establishment and wise use of sovereign wealth funds. Since the Project s inaugural stakeholder consultation workshop that was held in 2011, transparent and good governance measures in mining revenue management have been regularly emphasised in numerous events. From the outset, mining economists, revenue and sovereign wealth fund Experts have been invited and supported to attend and provide advice during regional stakeholder consultation and training workshops. Relevant experts from renowned institutions such as the World Bank, 25

26 UNEP/GRID-Arendal, IHC Mining, and the International Monetary Fund (IMF) have been engaged to shed light on revenue management and the benefits of saving schemes with excellent examples from around the world. The Project had collaborated with the IMF through PFTAC (Pacific Financial and Technical Assistance Centre) in convening the 5 th DSM Regional Training Workshop in Rarotonga Cook Islands that focused on the Financial Aspects of Deep Sea Minerals. SPC will again jointly organise the 7 th DSM Regional Training Workshop that will be held in August this year and will specifically focus on the Development of Appropriate DSM Fiscal Regime and Revenue Management Option for Pacific ACP States. As a consequence of the Project s advocacy on prudent revenue management and the establishment of national saving schemes, a number of countries have developed (e.g. Cook Islands) or are in the process of developing (e.g. Tonga and PNG) relevant policy and legislation that will ensure that mining revenues are proper utilised and a portion is saved / invested for future generations. In addition to the establishment of NOMC (National Offshore Minerals Committee) in many countries, the government of PNG, Cook Islands, and Tonga have either established or strengthened relevant national institutions to be responsible for DSM activities. Other countries such as Kiribati, Solomon Islands and Fiji are using their existing government structures to address issues relating to DSM. As part of ownership transfer, the Project is providing advisory and financial support for NOMC activities in a number of countries whereby members of this committee are actually implementing in-country Project activities. However, despite all the Project initiatives such as assisting countries to put in place necessary national legal instrument, filling knowledge gaps, sharing DSM information, and encouraging national stakeholder participation, some countries have clearly demonstrated that they would require external assistance to regulate and be involved in DSM activities. This external support will enable them to fully realise their DSM potential and the subsequent benefits emanating from deep sea mining. Most Pacific ACP States would require specific budgetary allocation, technical expertise and technology requirement in order to embrace and effectively support in-country DSM activities. These challenges have been raised multiple times in the Project meetings and acknowledged as well beyond the capability of Pacific ACP States. Country representatives have agreed that regional intervention will continue to play a prominent role in this new industry in the future. 9. COMMUNICATION AND VISIBILITY In the efforts to inform stakeholders and the public on various issues relating to DSM as well as the Project activities, outputs and outcomes, the Project continued to prepare press rereleases from time to time and shared them with communities throughout the Pacific. In addition to the information sharing initiatives of the Project as highlighted in Section 3.5 of this report, technical reports and information brochures have been disseminated to various stakeholders in the Pacific and beyond as part of the Project s communication and visibility. 26

27 Press releases were prepared for major Project events and published in various media outlets throughout the region. These include: (i) 2 nd Geoscience Steering Group meeting, (ii) the 6 th DSM Regional Training Workshop; (iii) the RMI DSM public consultations; and (iv) the Solomon Islands national DSM Youth Debate. Project events during the reporting period have been adequately covered and a press release is shown in Figure 15. Figure 15: The press release on the RMI DSM consultations that appeared in the RMI Journal on 17 th April Further, banner and posters were prepared and displayed during national awareness meetings and regional training workshops. The financial support of the EU was highlighted in all official SPC press releases, and other communication and visibility initiatives of the Project between January and June th PROJECT STEERING COMMITTEE MEETING The 6 th Project Steering Committee meeting was held at the Tanoa International Hotel in Nadi Fiji on Monday 13 th April Apart from Palau and Niue, thirteen of the fifteen participating countries of the Project were represented during the meeting. Also in attendance were Messrs Jerome Pons and Albert Cerelala, the officers in charge of the Project at the European Union Delegation for the Pacific in Suva. Mr Scott Roger of PFTAC also attended the meeting and presented the draft Regional Financial Framework that has been jointly developed by PFTAC and SPC through the Project. The meeting was chaired by Prof Mike Petterson, the Director of GSD. The Project Team Leader presented the update highlighting project activities as well as achievements, and challenges that have been encountered during The 2015 work plan and budget were presented, deliberated and approved during the meeting. This was followed by the presentation on the results of the Project s Mid-Term Evaluation (MTE) that was conducted in Participants had expressed their gratitude to SPC for the assistance rendered over the years and the excellent results of the MTE. The Project Legal Advisor s made a presentation on the 1 st draft of the Regional DSM Agreement and the proposed process and timeline to engage relevant stakeholders in PICTs before the Agreement is presented to CRGA for deliberations and then to the Forum Leaders 27