99586 ANNUAL REPORT As of December 31, 2014 EI-TAF Donors Meeting April 22, 2015 Washington, DC 0 I. EI-TAF BACKGROUND This report has been prepared to provide Extractive Industries Technical Advisory Facility (EI-TAF) donors (Australia, Belgium, Canada, IFC, Norway, and Switzerland) with an update on progress made since the program’s inception in 2009. Objectives and Expected Outcomes The objective of EI-TAF is to assist resource-rich, developing countries to correctly structure extractive industry transactions and related sector policies from the outset, thus reducing the risk of costly or politically difficult remediation at a later stage. The EI-TAF facilitates rapid-response advisory services and capacity building for extractive industry resource policy frameworks and transactions. EI-TAF also supports the production and dissemination of global knowledge products on extractive industry sector issues to help address the lack of an integrated body of good practice for sound extractive industry sector governance and management around proposed developments. The expected outcome from EI- TAF assistance is to level the playing field and ensure that resource-rich, developing countries, and ultimately their citizens, benefit from the exploitation of their extractive resources. Operating Structure The World Bank’s Energy and Extractives Global Practice (GEEDR) is responsible for administering the EI-TAF (including fiduciary and M&E responsibilities), preparing the EI-TAF work plan, supervising activities, organizing donor meetings and reporting to donors. The EI-TAF donors meet annually to (a) review and approve the EI-TAF Status Report, including proposed activities (pipeline) and estimated budgets and financial updates; (b) review the lessons and experiences of the implementation of the EI-TAF activities, including results achieved; and (c) provide strategic guidance to the EI-TAF Team on the implementation of the activities. Given EI-TAF’s rapid-response, demand-driven nature, it is possible that requests for assistance not included in this work plan will come up over the course of the coming year and all such new projects will be circulated electronically for review and comments by the donors. 1 Key Components The EI-TAF has two key components: (i) rapid-response advisory services; and (ii) global knowledge management/good practice in extractive industries sector governance in support of grant implementation. (i) Rapid Response Advisory Services Rapid-response advisory service activities by their nature cannot always be predicted, but are likely to focus on eligible countries with capacity needs in the following areas:  Contract negotiation for extractive industry transactions (or where legally feasible, mutually-agreed dispute mediation), including the cost of logistics of such negotiations;  Short-term capacity building for members of the beneficiary country’s negotiation teams, including studies to prepare for negotiations;  Technical assistance in support of a specific extractive industry transaction under review, to update the policy, institutional, fiscal, legal and regulatory frameworks (including mining and hydrocarbon codes and licensing registers) of the country concerned, including revenue management and benefits sharing across levels of government and community; and  Technical assistance on structuring extractive industry licensing rounds, public offerings (tender/auction), and competitive and transparent tender packages to help resource-rich countries optimize the value of national extractive industry resources, including the cost of logistics of such negotiations. As compared to the early years of EI-TAF, when majority of support was recipient executed, the proportion of Bank- executed rapid-response advisory services to client countries have increased to mitigate for long preparation time for recipient-executed programs. This shifted emphasis from direct support for transactions (which has to be recipient executed), to more a general good practice advice on sector laws and regulations that govern those transactions and future transactions. . Though none have yet been proposed, activities with regional/sub-regional organizations will also be considered under EI-TAF. (ii) Knowledge Management Knowledge management activities aim to facilitate the gathering and dissemination of good practices in extractive industry sector governance. The focus is on:  Providing a framework of good practices and discussion of issues that may be relevant for governments facing the task of making extractive industry resources available to private investors;  Gathering and disseminating lessons of experience based on advisory services provided, including through publications, workshops, conferences, and the like;  Preparing studies, reports, policy notes and other documents related to EI-TAF activities. Demand-driven Approach Provision of support for rapid-response advisory services is demand-driven. Requests for assistance are generated via:  Direct requests from resource-rich, developing country governments;  Sector dialogue between Energy and Extractives Global Practice (GEEDR) and resource-rich client countries;  Dialogue between other World Bank staff and resource-rich client countries;  Commitments in World Bank Country Assistance/Partnership Strategies, linkages to World Bank lending operations, analytic work, technical assistance, and so on;  Dialogue between other stakeholders (e.g., donor partners) and resource-rich client countries. 2 Requests for support for rapid-response advisory services are assessed along the following lines:  Level of political commitment and national ownership. Degree of commitment of a government and stakeholders to implement sound sector governance, including readiness to move on reform steps needed.  Country capacity gaps/needs. The assessed capacity gaps (especially in fragile states, IDA-eligible, and post-conflict countries) in a country in which the EI-TAF interventions could have a high pay-off and impact.  Resource dependency and poverty impact. The size of the extractives sector and revenues to the economy and exports—and the poverty-alleviation potential from rapid-response advisory services.  Demonstration potential in sub-region context. Potential for demonstration effect to “pull” other countries in the sub-region to adopt sound sector governance principles  Potential for sustainable investment. Impact in terms of facilitating sustainable private sector investment in the country’s extractives sector.  Value for Money. Overall cost-efficiency of activities, which should aim to ensure value for money, consistent with appropriate standards of quality. II. THE WORLD BANK AND EI-TAF Energy and Extractives Global Practice (GEEDR) While EI-TAF remains managed under the same arrangements as in the past in terms of program management and task team leaders teams, institutional arrangement has changed as of July 20014. In 2014, the World Bank underwent an historic reorganization. The department previously known as Sustainable Energy, Gas, Oil and Mining (SEGOM) (which housed EI-TAF and other extractive sector related programs) became a part of the Energy and Extractives Global Practice (GEEDR). The key changes for the extractives team are an in-house access to experts on energy (including mid- and down- stream petroleum in all regions), as well as easier in-house access to knowledge products, global expertise, all in order to foster sharper and faster solutions to worldwide challenges. In terms of overall strategy and engagement of the World Bank in extractives sector, there are no significant changes and our involvement in extractive industries continues to seek to help countries seize opportunities they offer for development and poverty reduction. The World Bank Group works along the entire extractive industries value chain, from award of contracts and licenses, to implementation of sustainable development policies and projects. EI-TAF support falls under the first chevron of the value chain: helping to ensure that developing country clients structure their extractive industries transactions properly from the outset. GEEDR continues to manage a range of global and country programs in extractives. GEEDR’s lending portfolio in EI currently consists of 14 dedicated extractives sector IDA funded technical assistance credits totaling $437 million. Of these, ten are in Africa, two in South Asia, and two in East Asia; an additional project is due to be approved in 2015. GEEDR manages 41 Recipient Executed grants for extractive sector reforms1 totaling $77.6 million, 16 Externally Funded Output (EFO)2 projects totaling $5 million, and seven reimbursable technical assistance projects3 of about $1 million. GEEDR also manages at least seven major components dedicated to extractives which are embedded in operations managed by other practices. There are presently eight active analytical tasks (ESW)4 under preparation. The non-lending technical assistance5 1 . These include grants under MDTFs for Extractive Industries Transparency Initiative, Extractive-Industries Technical Advisory Facility (EI-TAF), Global Gas Flaring Reduction (GGFR), Africa Sustainable Extractive Industries Trust Fund (AEITF) 2 . EFOs are a form of knowledge product where an external contributor finances preparation of specific outputs on agreed topics. Current EFOs managed by GEEDR are funded by Australia, Canada, Germany, UK, Norway, and Exxon 3 . RAS’s are technical assistance and capacity strengthening programs funded by client governments’ themselves 4 . ESWs are formal peer reviewed publications representing specific data and views on topics of interest. 5 . Non-lending TA includes a range of just-in-time assessments, reports and/or workshops to inform specific policy views and needs in client countries. 3 portfolio currently consists of 76 activities covering countries in all six Regions, as well as activities that are not country- specific. GEEDR administers a number of extractives trust funds, including the EITI Multi Donor Trust Fund (43 active projects; since 2005 to-date EITI-MDTF received $72 million in contributions from 15 donors), the Extractive Industries Technical Advisory Facility (EI-TAF, 31 active projects, since 2009 received $26.5 million in contributions from six donors), Africa Sustainable Extractive Industries Trust Fund (ASEI, one project, one in appraisal, since 2012 received US$10 million), Global Gas Flaring Reduction facility (GGFR, three active projects, since 2003 $45 million contributions from multiple donors6) and specific project co-financing grants that are managed jointly with IDA projects (five co-financing grants totaling around $30 million). Although EITI-MDTF and EI-TAF enjoy wide support and have been producing robust results, the World Bank and donors have decided to use the opportunity of their closure at the end of 2015 to restructure them into a single MDTF, and expand the scope to accommodate new requirements of the EITI Standard and incorporate lessons learnt to-date. The new setup will allow to combine reforms along the entire EI Value Chain (under the same financing agreement), thus improving coordination across components, and on balance reducing processing time and cost of preparation, supervision and implementation of projects (as compared to the previous practice of developing separate EITI-MDTF and EI-TAF projects). The new MDTF – Extractive Global Programmatic Support (EGPS) will provide the necessary grant funds to enable the World Bank to innovate and leverage IDA resources. It will also enable all partners to benefit from synergies across a broad portfolio of EI focus areas and activities. As EGPS is a forward looking approach to continue EI-TAF activities, an Annex is added to describe this new set up which will come into force during the first half of FY16 (see Annex 2). III. CURRENT STATUS OF EI-TAF ACTIVITIES Rapid-Response Advisory Services (Country Level) The current allocation of projects reflects the distribution of the Bank’s policy support around oil, gas and mining. Bank task team leaders on this broader dialogue serve as the point of contact for EI-TAF requests, prepare documentation and supervise implementation of the grants. A concentration of mining-based EI-TAF grants reflects the activities of mining teams during the EI-TAF start-up period (2009 – 2012); and the number of oil and gas grants has increased as those teams engaged more deeply, and there are now a number of oil and gas projects under implementation. Geographically, the portfolio of activities under EI-TAF spans the globe (Latin America, Africa, and Asia), but there is a concentration of projects in Africa (Latin America being the second most active). African countries remain a source of demand for advisory services, but the team has been working towards a more diversified country portfolio. Moreover, the current portfolio also reflects a priority given to governments facing time-bound decisions around new proposals, selected from a larger pool that included the possible renegotiation of existing development agreements. Since the trust fund’s inception in 2009, approximately US$20.9 million has been committed across the portfolio, financing country-specific projects and global projects. Ten country-specific grants have completed (Kenya, Kyrgyz Republic, Liberia, Mauritania, Mexico, Mozambique, Pakistan, Rwanda, Sierra Leone, and Yemen) and two regional activities for a total amount of US$5.5 million. Active country-level grants include: Chile, Colombia, Republic of Congo, Côte d’Ivoire, Dominican Republic, Ethiopia, Guinea, Haiti, Honduras, Madagascar, Peru, Seychelles, Togo, Uganda, and Uruguay (total commitment amount US$9.0 million). The pipeline of potential projects includes grants to the following countries: Armenia, Guatemala (approved in 2014, but scope and funding have been revised), Papua New Guinea, Somalia, and Tanzania (total value US$2.3 million). 6 . The GGFR has a distinct donor base (18 private oil companies as well as traditional donors) and a specific but compatible mission—to increase the use of associated natural gas and reduce gas flaring and venting. 4 Knowledge Management Activities (Global) Completed global knowledge management activities include: Contract Monitoring and Compliance, EI Source Book, and IBA Civil Society Forum. Current global knowledge management activities include: Mining Negotiation Training Program, Communications, Mining Governance Assessment, and Program Management (total active and completed value US$4.1 million). Further details on these global knowledge activities are provided below: 1. Mining Negotiation Training. This activity was launched in early 2014 and is to be finalized in late 2015. Under this activity, EI-TAF focuses on building capacity of the countries to negotiate on their own. The objective is to train developing country governments on the effective negotiation of mining contracts with foreign investors. To build global capacity on the negotiation of mineral development agreements, the World Bank hosted two international training workshops that brought together government representatives from 18 countries, with EI-TAF funding. In May 2014 the first workshop was held in Arusha, Tanzania with 35 representatives from Anglophone Africa including from Sierra Leone, Tanzania, Ethiopia, Zimbabwe, Mozambique, Liberia, Uganda, Malawi and Rwanda. The second workshop for Francophone Africa was held in Ouagadougou, Burkina Faso in October 2014 and included 35 representatives from countries spanning Senegal, Congo, Burkina Faso, Guinea, Mali, Niger, Togo, Madagascar and Mauritania7. A third workshop is planned in Tunis in April 2015 – which will include additional sections on fiscal modelling. The workshops for francophone Africa (Ouagadougou and Tunis) were organized in collaboration with the African Legal Support Facility (ALSF). Click here to see a story on these training events featured on the World Bank’s website. 2. Mining Governance Assessment (MGA): Through a competitive process on June 10, 2014, the Bank selected and hired Adam Smith International (ASI), a UK-based consulting firm, to assist the Bank in implementation of the Mining Governance Assessment (MGA) project. The objective of the MGA is to assess governance quality particularly relevant to mining and mining sector competitiveness and attractiveness. The project is well underway and a work schedule and approach agreed, and a customer consultation study completed. Steps in progress are the scoping study report (a major deliverable of the project) including methodology and questionnaire to be used during interviews has been formally accepted by the World Bank. The first country assessment in Zambia took place in March 2015, and will be followed by another seven country assessments that are all to be completed by December 2015. A draft country assessment report for Zambia will be available in April 2014. Should the project continue to Phase 2, it is anticipated that further funding will be requested through EGPS, the EI-TAF’s successor fund, and from the Government of Germany. Note: MGA Scoping Study Report available upon request. 3. Extractive Industries Source Book. The EI Source Book project, funded by an independent DGF grant, was prepared to support an audience of developing country government officials, civil society, donor organizations, and media, around the sustainable development of hydrocarbon and mineral resources by holistically framing key issues using the EI Value Chain in its methodology. The EI-TAF supported the EI Source Book through preparation of customized knowledge products that were included in the EI Source Book for global dissemination. More broadly the EI Source Book project has produced two principal outputs: an online knowledge resource platform (www.eisourcebook.org) and a hard copy of the narrative text; both of which are designed to support capacity building towards stronger mineral development agreements. The strong online presence of the EI Source Book (>5,000 unique visits per month) has been achieved through interconnectivity with the GOXI social networking platform for extractives. After three years of editorial revisions and review, the WB took delivery of the “hard copy” narrative in December 2014 and that is now being readied for submission to the Office of the Publisher at the World Bank. This is a multi-disciplinary work which draws on an extensive body of expertise from partners in 7 It is noted that the second workshop was interrupted as a result of civil unrest in Burkina Faso with only a day of training completed. The 3rd workshop in Tunis will include most of the earlier participants to some extent to compensate for the interruption. 5 the Source Book knowledge consortium (a collection of policy institutes and civil society groups) and on present and former sector practitioners. During its near-three year period of gestation, the Source Book narrative had to take into account the fast moving pace of debate on the role of extractives in development; and the Source Book knowledge consortium played a key role in alerting authors to editorial changes. Going forward, the Bank is engaged in dialogue and consideration of a partnership to use the EI Source Book to prepare a Massive Online Open Course (MOOC). This would further package and disseminate knowledge on the extractive industries to a wide end-user audience. The next generation of the EI Source Book is envisioned to remain an externally hosted platform with multiple partners; and is envisioned to further integrate the existing compendium of knowledge with new forms of authored video, blogs and other social media, and increase dissemination through cross platform intelligent search capabilities. For more information, visit http://www.eisourcebook.org/. 4. EI-TAF Consultant Pool for Advisory Assistance. In an effort to expedite the deployment of advisers, the World Bank team pulled together a consultant roster on which EI-TAF recipient countries can draw. This roster is being used to provide governments with vetted long or shortlists of consultants that fit the profile of the type of assistance sought. In 2014, a request for Expressions of Interest was published on the Bank's external website aiming to attract new consultants for the EI-TAF roster of experts. As a result, 27 additional consultants submitted expressions of interest, and 16 of these consultants met the qualification criteria and were subsequently added to the existing roster. In parallel, a request to reconfirm their interest was sent to existing consultants. CVs of consultants that reconfirmed their interest were accordingly updated. While efforts were initiated to develop a customized streamlined process for selection of advisors under EI-TAF, due to the launch of major restructuring of the World Bank, as well as significant procurement reform and changes in the policy, this decision had to be postponed. This will move forward after the reform process is completed, in July 2015. The roster of experts may then be used for support provided under Component 2 of EGPS. III. TOPICS FOR DISCUSSION DURING DONOR MEETING EI-TAF Evaluation As agreed with EI-TAF Donors, the World Bank hired a consultant to do an evaluation of the EI-TAF program. The consultant was hired through a competitive selection process, including Donor representatives where allowed under the World Bank’s procurement rules. The consulting firm, ORBICON/GEUS, has provided a draft of the report, including preliminary recommendations. The preliminary recommendations for EI-TAF Rapid Response Advisory Services and Knowledge Management are as follows, and have been incorporated into the design of the EGPS. Table 1: Recommendations from EI-TAF Evaluation Recommendations for EI-TAF Rapid Response Advisory Services EI-TAF Secretariat Response 1 The approach of the EI-TAF is recommended to be continued, Already taken on board as part of EGPS with some modifications to the set-up and management of the facility. 2 The EI-TAF Secretariat will need to take lead on the developing of A results framework was developed for EGPS which an operational framework for results based management and features EI-TAF type support monitoring 3 The program should focus more on developing of partnerships Acknowledged and in implementation as evidenced by with co-funding agencies at regional and national levels. the work program. 4 More systematic sharing of experiences / learning across the EI- Acknowledged and will be scheduled as a periodic TAF will take place event. 6 5 The EI-TAF project selection will be based on more strategic EI-TAF Secretariat will follow up to obtain clear selection criteria to reflect the potential wider impact and recommendations. sustainability from the project activities. 6 To clarify the potential implications of the increasing number of Acknowledged and clear distinction between RE and BE “Bank Executed” projects on ownership and sustainability issue introduced in EGPS. 7 To improve the interaction between the EI-TAF Secretariat and EI-TAF secretariat is open to suggestions from donors. the EI-TAF donors for mutual benefits and accountability. New reporting schedule is being adopted for EGPS will in part address deficiencies. Recommendations for Knowledge Management 8 (EI Source Book): To consider a “scaling-down” of the EI Source EI Source Book next phases are under discussion. Book project to make it manageable for maintaining and Decisions will be made based on more outreach and sustaining in a future with limited funding support to the project. feedback from users. 9 (Training): It is recommended to map and look closely into Acknowledged. training program activities and experiences from other stakeholders in the extractive industry sector. Financial Status Update The EI-TAF MDTF will close December 31, 2015. Future support for EI-TAF-related activities will be provided with financing from the Extractives Global Programmatic Support (EGPS) Multi-Donor Trust Fund. Proposed New EI-TAF Activities to be completed by December 31, 2015:  Country: Somalia – 550,000  Country: Tanzania – 300,000  Country: PNG – 550,000  Country: Armenia – 300,000  Country: Guatemala – 550,000  Global: Africa Mining Law Atlas (AMLA) – 350,000  Global: Mining Governance Assessment additional funding – 350,000  Global: MOOC on Extractives – 100,000 Sources and Uses of Funds. Table 2 shows the sources of funds as of December 31, 2014. A net total of US$23.4 million has been received to the EI-TAF by the current six donors. Table 3 shows the Disbursements and Allocations of Funds by Country/Region as of December 31, 2014, totaling US$16.8 million. In addition, Table 4 shows that US$4.1 million has been committed for global/knowledge management activities. Estimated Fund Balance at End Disbursement (June 30, 2016). Table 5 shows that the fund balance at the EI-TAF End Disbursement date of June 30, 2016 will be approximately US$2.5 million. After full disbursement against all commitments, the fund balance will be returned to donors according to the pro-rata share of each donor’s contribution to the trust fund (see Table 2 for Percent of Total Net amount). 7 Table 2: EI-TAF Annual Contributions from Donors FY09-14 (US$ million) Future Inception to Contribution % of Total Net Date Actuals Under Agreement Total Amount Australia 5,024,654 - 5,024,654 21% Belgium 1,291,700 - 1,291,700 6% Canada 10,079,375 - 10,079,375 43% IFC 2,750,000 - 2,750,000 12% Norway 4,777,419 - 4,777,419 20% Switzerland 1,200,000 - 1,200,000 5% Total 25,123,149 - 25,123,149 100% Admin fee, net of investments (1,727,146) - (1,727,146) Net Contributions 23,396,003 - 23,396,003 Table 3: Region/Country Work Program Region/Country TF Name Sum of Sum of Disb. TF Grant Disbursem % Status Amount ents Africa 9,573,744 6,199,172 65% Congo, Republic of Congo Republic: Supervision of Mining TA 50,000 49,613 99% Active Dialogue Congo Republic: Mining TA Dialogue 475,000 246,945 52% Active Cote d'Ivoire Cote d'Ivoire: Supervision of Support to Mining 50,000 - 0% Active Code revision and Mining Cadastre Modernization Cote d'Ivoire: Support Mining Code Revision and 350,000 265,486 76% Active Mining Cadastre Modernization Ethiopia Ethiopia: Improving Extractive Ind Devt - SPN 50,000 15,196 30% Active Ethiopia: Improving Extractive Ind Devt TA Grant 750,000 50,418 7% Active Guinea Guinea: EI-TAF Grant 850,000 703,865 83% Active Guinea: Supervision of EI-TAF Grant 100,000 98,952 99% Active Kenya Kenya: Oil and Gas Grant - - Closed Kenya: Oil and Gas Legal and Contractual 598,423 598,423 100% Closed Framework Review Kenya: Supervision of Oil and Gas Framework 49,994 49,994 100% Closed Review Liberia Liberia: Supervision of EI-TAF Grant 55,159 55,159 100% Closed Liberia EI-TAF Grant 1,000,000 1,000,000 100% Closed Madagascar Madagascar Extractive Industries Technical 400,000 17,862 4% Active Assistance Mauritania Mauritania - Gas-to-Power Negotiations TA 305,037 305,037 100% Closed Mauritania - Gas-to-Power Negotiations Technical 57,961 57,961 100% Closed Assistance - Bank Supervision Mozambique Mozambique: Supervision of EI-TAF Grant 77,264 77,264 100% Closed Mozambique: EI-TAF Grant 735,588 735,588 100% Closed Rwanda Rwanda: Petroleum Exploration Capacity Building 40,355 40,355 100% Closed 8 Rwanda Petroleum Exploration Capacity Building 336,732 336,732 100% Closed Project Seychelles Seychelles - PetroSeychelles EI-TAF 70,000 47,756 68% Active Seychelles: EI-TAF Grant 500,000 232,639 47% Active Sierra Leone Sierra Leone: Supervision of Grant 49,813 49,813 100% Closed Sierra Leone Extractive Industries Technical 747,417 747,417 100% Closed Advisory Facility Project Somalia New Project being discussed 550,000 - 0% Pending Tanzania New Project being discussed 300,000 - 0% Pending Togo Togo: Legal and Mineral Rights Cadastre Reform 350,000 155,305 44% Active Togo: Supervision of Legal & Mineral Rights 50,000 12,107 24% Active Cadastre Reform Uganda Uganda: Mining Sector Development Support 300,000 106,880 36% Active Africa Regional African Mining Vision: Geo-science for Africa's 100,000 55,225 55% Active Transformation Regional Petroleum Sector Technical Assistance 225,000 87,177 39% Active East Asia & Pacific 550,000 - - Pending Papua New Guinea New Project being discussed 550,000 - 0% Pending Europe & Central Asia 634,213 334,213 53% Armenia New Project being discussed 300,000 - 0% Pending Kyrgyz Republic Kyrgyz Republic: Mining Sector TA Project 262,445 262,445 100% Closed Kyrgyz Republic: Mining Sector TA supervision 71,768 71,768 100% Closed Latin America & Caribbean 5,492,097 2,978,678 54% Chile Chile: Improving Natural Gas Distribution 390,000 312,859 80% Active Colombia Colombia: Strategic Mineral Reserve Areas 579,040 525,935 91% Active Colombia: Supervision of Strategic Mineral 65,000 58,109 89% Active Reserve Areas Dominican Republic Dom Rep Grant Support the Sound Devt Mining 500,000 15,366 3% Active Dom Rep SPN Support the Sound Devt Mining 50,000 - 0% Active Guatemala New Project being discussed 550,000 - 0% Pending Haiti Haiti Mining Dialogue TA 100,000 59,059 59% Active Haiti: Mining Dialogue TA 550,000 442,117 80% Active Honduras Honduras: Building Regulatory Capacity for 500,000 163,515 33% Active Improved Governance of EI Honduras: Supervision of the grant for Improved 50,000 10,056 20% Active Governance of EI Mexico Env. Support to Hydrocarbon Agency 50,000 - 0% Active Mexico Royalties Reform for the Mineral Sector 179,155 179,155 100% Closed Mexico Royalties Reform supervision 48,902 48,902 100% Closed Peru Peru Developing a New Natural Gas Development 830,000 466,204 56% Active and Use Policy Peru: Grant for Local Employment in Mining 350,000 177,471 51% Active (Apurimac region) Peru: Policy Options to Enhance Environmental 200,000 120,847 60% Active Sustainability of the Mining Sector Peru: Supervision of grant for Local Employment 50,000 49,958 100% Active in Mining in Apurimac Region Peru: Supervision of Policy Options to Enhance 50,000 49,993 100% Active Environmental Sustainability of the Mining Sector Uruguay Uruguay Capacity Building for Oil & Gas Sector 400,000 299,132 75% Active Middle East & North Africa 52,523 52,523 100% Yemen, Republic of Yemen - Oil & Gas Strategy TA supervision 52,523 52,523 100% Closed South Asia 514,825 514,825 100% 9 Pakistan Pakistan: Balochistan Extractive Industries 465,493 465,493 100% Closed Technical Advisory Facility (EI-TAF) Pakistan: Supervision of EI-TAF Grant 49,332 49,332 100% Closed Total Region/Country 16,817,402 10,079,411 60% Table 4: Global/Knowledge Work Program Allocation Disbursed Disb Status Rate Global Projects 1,906,016 510,866 27% African Minerals Legislation Atlas 350,000 - Pending MOOC on Extractives 100,000 - Pending Global Mining Governance Assessment Supplemental 350,000 - Pending Mining Governance Assessment 250,000 - 0% Active Supervision of Mining Governance Assessment 50,000 - 0% Active ETAF Training Program Mining Negotiation 556,100 330,958 60% Active Supervision of ETAF Training Program on Mining Negotiations 50,000 46,462 93% Active EI-TAF Communications 100,000 33,529 34% Active IBA - Civil Society Forum 25,000 25,000 100% Closed EI-TAF: Contract Monitoring & Compliance in the Extractive Industries 24,919 24,919 100% Closed EI Source Book - BP Operational Phase (EISB-BPOP) 49,998 49,998 100% Closed Pipeline Development 320,000 295,809 92% Active Partnership Advocacy 250,000 221,437 89% Active Knowledge Management 153,162 153,162 100% Active Program Management & Administration 1,500,000 826,480 55% Active Table 5: Total Sources and Uses of Funds (Fund Balance at End Disbursement June 30, 2016) Net Contribution and Pledges $23,396,003 Regional Work Program 16,817,402 Global Work Program 1,906,016 Pipeline Development 320,000 Partnership Advocacy 250,000 Knowledge Management 153,162 Program Management & Administration 1,500,000 Total 4,129,178 Projected Fund Balance at End Disbursement (June 30, 2016) 2,449,423 10 Annex Table 1a: Extractive Industries Technical Advisory Facility (EI-TAF) Active Country-level Activities Project Title Brief Description Approx. Approval Task Team Status Grant date/ Leader Amount closing US$000’ date Chile: The project's development objective is to assist 350 David This project emerged to provide a quick response to the Chilean Improving the Chilean government improve natural gas Reinstein government’s (GoC) request for assistance in the revision and Natural Gas distribution in the country by strengthening the improvement of the legal and regulatory framework for natural gas Distribution technical capacity at the Ministry of Energy and distribution in Chile. Since the management approval of the concept in Mines and the National Energy Commission to August 2014, the team has been twice to Chile on mission and manage and oversee the natural gas sector, and progress has been made towards the project's implementation. by providing expert advice to the government as it develops a new legal and regulatory framework Component A: Bolster the GoC's capacity to manage and monitor the for the development and distribution of natural transport and distribution of natural gas gas in Chile. Evaluation of existing institutional framework – Report submitted October 2014, Evaluation of existing institutional capacity and recommendations to build capacity – comments submitted October 201, Action plan for building up institutional capacity – comments submitted October 2014. Component B: Support the development of a new legal and regulatory framework for natural gas transport and distribution Review of existing legal and regulatory framework – Report submitted January 2015. Comparative review and recommendations on proposed "Short Law" – Draft submitted January 2015 Successful organization of an "International Workshop on Natural Gas Transport and Distribution Regimes" in Santiago, Chile (For more please check: http://www.minenergia.cl/ministerio/noticias/generales/ministro- pacheco-queremos-abordar.html); On-going quality control for in-depth study of the natural gas market in Chile. Recommendations on content/form of the "Long Law" – draft report presented January 2015. A World Bank paper with specific recommendations on the regulatory adjustments needed in the natural gas distribution sector is under preparation and will be delivered to client before the end of fiscal year 2015. Colombia One of Colombia’s strategies to increase the 644 Daniele La The project is divided into two components which focus on (i) developmental impact of the exploitation of its Porta developing a tender methodology for the competitive bidding of 0 best mineral assets was the creation of strategic strategic mineral reserves areas (SMRAs), which will include the reserves for key minerals such as gold, PGEs, drafting of template tendering documents; and (ii) capacity building copper, iron-ore, phosphates, uranium and coal. around mineral tendering processes, including workshops and The strategic mineral reserve areas are to be programmed study tours to review and learn from international best tendered to increase the level of technical, practices. The project Is being successfully implemented and the environmental and social responsibility, which tendering methodology should be finalized by end April 2015. The makes for a more rational use of strategic related draft regulations and tendering packages have been finalized minerals owned by the country aiming at and should be delivered to the GoC along with the methodology. obtaining the best conditions and benefits for the state. The development objective for this grant is: improved legal/regulatory frameworks and technical, environmental and social standards for the undertaking of transparent and non- discretionary competitive tenders for strategic mineral reserve areas as well as enhanced capacity for the Colombian Ministry of Mines and Energy for the preparation of bidding packages for future tendering processes. The activities would include an evaluation of the "auctionability" of the selected areas. Deliverables would include tendering packages for up to three strategic mineral reserve areas to be selected. It is expected that the tenders be carried out by the GoC resulting in new exploitation concessions with better terms for the country. Republic of Following the Government priorities and based 475 Kirsten Lori The project was officially launched during a workshop in Brazzaville in Congo: Mining upon the key challenges the mining industry is Hund March 2013. The EI-TAF assists the government to: TA Dialogue facing in Congo at the moment,, the project - Develop a training plan to improve the capacity of the focuses on 3 key areas of mining sector Ministry of Mines for the short and medium term governance capacity support: 1) the legal - Provide technical support to the Mining Code Review context: under this pillar, the project support the Commission Commission responsible for the revision of the - improve the Congolese mining cadaster system Congolese mining Code, through training and Since the project launch, an institutional assessment as well as a expert support 2) Contract negotiations: training needs assessment have been undertaken with the Ministry of technical support to the Negotiation Commission Mines to address capacity issues with in the Ministry dealing in of the Ministry of Mines a on financial modeling, particular with Contract management and negotiations. Based on this legal aspects, iron-ore market and project assessment, several training sessions, mainly focusing on financial development, financial forecasting and fiscal modelling, have taken place. Secondly, a series of legal workshops revenues, environmental and social aspects, have been organized with the Commission responsible for the revision mining infrastructure developments etc. of the mining code, focusing on the existing strengths and weaknesses Component 3) public private partnerships: of the Congolese Mining code in comparison with other codes in the 1 focusing in particular on the link between mining region in terms of competitiveness as well as international good and infrastructure development in Congo. One of practices, and talking in detail on issues like state participation, model the outputs will be the Development of a skills mining conventions and the fiscal regime. Thirdly, an assessment of gap analysis for mining sector institutions which the current state of affairs of the Congolese mineral cadaster has been will result in Recommendations for further undertaken, and a training session on international good practices of institutional capacity building cadaster management has taken place. A ten-day exchange visit to the DRC for a delegation from the Ministry of Mines has been organized, but had to be cancelled after the 1st day due to political unrest in Kinshasa. It will be organized again in February/March 2015. Côte d’Ivoire: In Côte d'Ivoire, over the last few years, the Bank 350 Brigitte The EI-TAF is assisting the government to: has been very instrumental in the provision of Bocoum - Build capacities for future upcoming negotiations of mining quality support to the mining sector including projects / contracts; assistance through a Mineral sector Capacity - Build capacities and acquire the necessary knowledge to building project and EITI, albeit with very limited update its Mining Code, especially regarding exploration and funding. The Bank intends to devote all efforts to concession permits of known deposits, environmental and contribute to the development of one of the social protection clauses, and increased local content; most promising mining sectors in Africa today, - Build relevant capacities within the Ministry to address that of Côte d’Ivoire. Several challenges remain governance constraints with regard to sustainable to meet the Government's objectives for the development in the mineral sector; development of the sector, namely: (i) to valorize - Work in close collaboration with the national Working Group the mineral potential; (ii) to use the mining in drafting the law and consult with private sector and civil sector as an engine of sustainable growth; (iii) to society representatives; modernize the institutional and legal framework - Organize consultative and restitution workshops (Mining Law) to make Côte d'Ivoire a much more attractive and sizeable investment destination; (iv) to improve governance and transparency in transactions; (v) to revise procedures for licensing; (vi) to upgrade the Mining Cadaster and title registry; (vii) to develop SMEs and the involvement of nationals in the supply chain and overall sector development in order to increase retained value and create greater employment (direct mine investment or local procurement); and (viii) to organize the artisanal mining sector. Dominican In recent years, the Dominican Republic has 50 Javier The proposed objective of the grant is to build up the Dominican Republic: experienced a significant expansion of its mining Aguilar Republic government’s governance of the mining sector by providing Mining Sector sector, which has challenged the government’s access to expert advice and sharing international good practices. The Assistance institutional and technical capacity to manage project would focus on: i) reviewing and modernizing the mining code and monitor it. In response, the government has and existing regulations; ii) strengthening the mining cadaster. created a new Ministry of Mines but it still needs 2 to build its legal and institutional capacity. To address some of these concerns, the government has made a request to the World Bank, but it is still preliminary. Ethiopia: The proposed Development Objective is to 800 Kirsten Lori At the request of the government of Ethiopia, and in order to respond provide the analytical, legal and capacity Hund to the recommendations of the Ethiopia the following components foundations to facilitate improved negotiation were undertaken. Mineral sector Assessment: the World Bank has outcomes for imminent Extractive Industry mobilized EI-TAF funding to assist the Government of Ethiopia with the developments in Ethiopia. The intermediate improvement of its institutional and policy frameworks for the result will be to provide recommendations and extractive industries. The Objective of the project in Ethiopia is training on strengthening the policy and legal strengthening the regulatory and governance framework, and building framework, which will enable the Ethiopian capacity for its developing oil, natural gas and mining sectors in line government to conclude better deals for the with good global good practices, in order to leverage the sectors as a sustainable extraction on their oil and mineral vehicle for shared prosperity. As part of EI-TAF, the World Bank resources. organized, in collaboration with other development partners, Ethiopia’s first extractive Industries Forum in October 2015. This forum gathered 150 representatives from industry, civil society, donors and government to discuss the opportunities and challenges for a sustainable development of Ethiopia’s extractive industries. Based on the recommendations from the forum, in 2015 we will develop, in close collaboration with the GoE, a series of reports with recommendations on the improvement of the legal and fiscal frameworks of the oil, gas and mineral sectors. Firms have been selected for the analytical work, and the first workshops will be organized in June 2015. Guinea: Aimed at supporting the government to address 850 Boubacar Project is under implementation. Extractive key constraints to the realization of proposed Bocoum Component 1: review selected mineral development agreements. Industries large mining investments, specific activities as Actions: Selected agreements were reviewed at the request of the Technical follows: (a) facilitate consensus and shared vision Government, and training conducted on contract negotiations. Advisory amongst stakeholders in the development of the Component 2: strengthen policy, institutional and regulatory reforms. Facility mining and hydrocarbon sectors in Guinea—in Actions: The project assessed the drafts of the mining code as it was response to a time-bound proposal for being developed and advised on related good practice. It was also mining/infrastructure developments; (b) build used to assess the legal framework pertaining to mining ancillary the capacity of the GoG to review mineral infrastructure development. development agreements in response to a time- Component 3: develop a shared vision for the management of the bound proposal for mining/infrastructure minerals sector. developments; and (c) support updating of the Actions: Several consensus building activities and training were legal, regulatory, and fiscal framework in the conducted. mining and hydrocarbon sectors. Guinea: Second phase funding. First phase aimed at The objective of the second phase of funding under the Guinea EI-TAF Second Phase supporting the government to address key grant was to provide the government with advisory services aimed at constraints to the realization of proposed large strengthening its technical and financial negotiation skills on mining 3 mining investments, specific activities as follows: ancillary infrastructure to enable meaningful progress toward (a) facilitate consensus and shared vision infrastructure licensing and development in the short term, and in so amongst stakeholders in the development of the doing create conditions for the mining companies to fulfill their mining and hydrocarbon sectors in Guinea—in engagement to exploit and export iron ore within the next 2-3 years. response to a time-bound proposal for mining/infrastructure developments; (b) build the capacity of the GoG to review mineral development agreements in response to a time- bound proposal for mining/infrastructure developments; and (c) support updating of the legal, regulatory, and fiscal framework in the mining and hydrocarbon sectors. Haiti The objectives would be to update the legal and 650 Remi Pelon Project supporting the Government of Haiti in improving the legal regulatory framework for extractive industries, framework for managing the mining sector was initiated in March build capacity for policy and negotiation of 2013 and completed in early 2015. It delivered significant results: a) mining agreements, and provide transaction Expert advice to in the preparation of a draft law to a Task Force of advice during negotiations of mining Haitian Government officials; b) An assessment of the institutional conventions. framework for mining; c) A full evaluation of mining title management; d) A comprehensive inventory of past and present mining titles; e) Haiti’s First Mining Forum and additional events and workshops with private sector and civil society. Honduras The government of Honduras currently does 550 Javier The proposed objective of the grant is to support the Government not have the institutional or the technical Aguilar of Honduras (GoH) in building up its capacity to manage and capacity to manage and monitor with the monitor extractive industries. The project would provide training growing interest in the country's extractives and advisory services related to: (i) the modernization of sector. As a result the government has Honduras’ mineral rights granting and management system; (ii) requested the World Bank’s help to develop building up INHGEOMIN’s capacity to oversee the mining sector, its regulatory capacity for improved and (iii) the management and monitoring the contracts for governance of the oil & gas and mining hydrocarbons sector and the organization of bids. sectors. Currently, the project made good progress on the mining cadaster component, supporting INHGEOMIN (mining authority) on cleaning up the backlog of requests and streamlining the procedures for mining titling. On the regulatory front, a proposal has been agreed with the Government for adjusting the legal procedures for accessing mining concessions. Africa The project is intended as a flexible, multi-year 225 David The EI-TAF grant supported the work of a legal consultant to assist Regional program to improve the ability of key institutions Santley GoL in drafting a new petroleum law, new NOCAL law, and new Petroleum to carry out government’s policy-making and model PSC. This work was completed in July 2014. The advice Sector TA regulatory functions in the emerging petroleum provided by the consultant was modified by government sector. Assistance will be delivered by means of counterparts and incorporated in draft legislation that was periodic missions to Ghana, Liberia and Sierra presented in a series of public consultations. After the Leone by Bank petroleum specialists and consultations and discussions with key legislators, a modified bill 4 consultants and through workshops, policy was presented to congress in 2014 and passed late in the year. papers, and other knowledge products. An However, the legislation has not gone into effect because the bill allocation of Bank Budget will support policy passed by congress is being rejected by the President’s office. The dialogue with the three governments by the Bank EI-TAF grant also supported part of the cost of preparing and TTL and regional events on topics common to the presenting a draft “Roadmap for the Petroleum three countries. Trust Funds (EI-TAF and PGI) will Directorate”. However, finalization of this work has been in hiatus be brought in to supplement the BB and to because of the Ebola crisis and because of uncertainty over the support country-specific activities identified institutional structure that will ultimately emerge from the final during the periodic Bank missions. petroleum legislation. Also, prior to the Ebola crisis, preparations were being made to provide geological and geophysical training to the NOCAL technical staff. Once the crisis subsides, this activity will likely resume. Madagascar: The grant will support to promote transparency 400 Remi Pelon Modernization of Sector Governance Frameworks for Extractive Extractive and inform legal decisions in reforming Industries (EI-TAF) for Madagascar includes efforts to improve Industries governance frameworks for extractive industries. transparency accompanied by assessments of legal and Technical Intermediate outcomes include: delivery of a institutional gaps and possible reforms. Strong expertise and Assistance comments on draft laws and fiscal regimes and international experience as well as extensive consultations should recommendations to improve legal and be mobilized to prepare for successful changes. In that institutional frameworks. perspective, the current EITI MTDF Grant will finance advisory services and on-the-job capacity building for: 1) Improvement of legal and fiscal frameworks. The Government has declared its intention to revise both the Mining Code and the Large Scale Mining Investment Law (LGIM) on the basis options set in the new Policy. The preliminary assessment of the fiscal regimes in place show how complex and highly technical the discussion is. Therefore the project will provide expertise both in legal and fiscal matters as well as analysis, modeling and training. 2) Improvement of institutional frameworks. The Government has declared its intention to create a mining state-owned company and promote other ambitious institutional reforms like the restructuring of OMNIS. Peru: Policy The grant will support the implementation of the 200 Ernesto The grant is supporting the preparation, at the regional level, of an Options to first phase of the Environmental Component of Sanchez- strategic environmental assessment (SEA) of the mining development Enhance the "Social Inclusion, Local Governance and Triana activities in Apurimac that will have a transformational impact in one Environmental Sustainable Mining in Peru Programmatic of the poorest regions of Peru; and, at the national level, an analysis Sustainability Knowledge Services (PKS)". The main objective of on the prevention and management of environmental conflicts in of the Mining the Environmental Component is to support the mining in Peru and an analysis of the environmental regulatory Sector government of Peru (GoP), at central and framework for mining activities. The main result coming from these subnational levels, to develop an inclusive and studies is that the Peruvian system for environmental quality control green mining sector as a harbinger for broad- requires significant strengthening for building trust and reducing based multi-sector growth of the Peruvian conflict among key mining stakeholders. This is critical for establishing economy. The PKS would be tested in the an evidence based environmental policy and management for mining 5 Apurimac region where strategic sustainable activities. To this purpose, a robust dialogue with national authorities, development options, investment strategies and particularly MINAM and MINEM, and regional authorities, the associated environmental policy options will be Regional Government of Apurimac (GRA) is ongoing which included a developed. The PKS is planned in phases. In the workshop held on 18 February in Abancay led by GRA and MINAM. first phase of the program, the PKS’s The project’s activities are well advanced and the team plans to Environmental Component will assist the GoP in complete the project this FY. enhancing the robustness of the existing environmental regulatory framework for mining activities, formulating a comprehensive system for preventing and managing mining conflicts and, establishing a multi-stakeholder framework for enhancing the environmental and social sustainability of mining-induced development. Peru: This project is a component of the Programmatic 350 Javier The Ministry of Energy and Mines (MEM) and the team discussed the Promoting Knowledge Service on Social Inclusion, Local Aguilar implementation and agreed to: opportunities Governance and Mining in Peru, a WBG multi- 1) Agrominas-Apurimac component: This activity will be given priority for local year program (FY13 to FY16) that responds to a after its public announcement on May 20 2014 by the MEM. The employment request for assistance from the Government of component will leverage mining activity to promote improved access around mining Peru (GoP) to make reduce the probability of to water and higher-value agricultural production. It was agreed that (APURIMAC) social conflict associated with mining. The GEEDR would work on mining-water, while the IFC will work on development objective for this grant is to assist mining-agriculture, and both will coordinate their activities with the the GoP in further developing its policies and MEM. approaches towards a more inclusive mining 2) “Informed Community Leadership for Constructive Multi- sector, aiming at leveraging large mining stakeholder Engagement” component: Coordinate this effort with the investments for regional/local development. MIM Program (IFC/Canada). The team also discussed the possibility of The activities would include an objective and the MEM using some of its own funds to supplement the funds comprehensive comparative evaluation of the provided by the World Bank to support this activity; quality of the different modalities of non-public 3) “Quality of non-public social investment through improved social investment in Peru; build local capacity and monitoring and guidance” component: Hire a reputed academic manage expectations for constructive multi- organization to conduct a mapping of the existing nonpublic social stakeholder engagement; enhance local investment associated with mining. The first mapping report has been employment by supporting the first regional pilot delivered to the MEM on January 2015. Based on this input, the for the GoP’s Agrominas initiative, which aims at project is organizing jointly with MEM two workshops with promoting agricultural development in areas stakeholders for getting their views and feedback on the main findings where mining occurs. and policy recommendations. Deliverables would include the first ever Next steps: The MEM in coordination with GEEDR and IFC will define a comparative assessment of all forms of non- detailed action plan for the implementation of the AgroMinas- public social investment associated with mining; Apurimac component. a network of informed local leaders able to engage with mining companies; an assessment of supply chain employment opportunities needed to support the Agrominas initiative. 6 Peru: The project development objective is to assist the 830 David This project emerged to provide a quick response to the Peruvian Developing a GoP in the elaboration of a long-term natural gas Reinstein Ministry of Energy and Mines’ request for assistance in the elaboration New Natural development and use strategy for Peru, which of a long-term natural gas development and use policy for Peru. Since Gas ensures sustainable, reliable and cost-effective the management approval of the concept in August 2014, the team Development supply of natural gas while maximizing its has been to Peru on mission three times and progress has been and Use Policy contribution to the decentralization of economic made towards the project's implementation growth, to shared prosperity and to social Component A: Improve Natural Gas Reserves Estimates. Evaluation of inclusion. institutional capacity at MEM and Perupetro - Training on natural gas reserves assessment was completed on December 15-16, 2014, An interim report was provided on February 2, 2015 and a final review of the methodology used to calculate Peru’s natural gas reserves is expected for April/May 2015, Dissemination – still being planned/discussed with the client. Component B: Develop a Gas Master Plan for the North and South of Peru. Estimate potential natural gas demand, conduct analysis of anchor industries, prepare evaluation of optimal pipeline routes/capacity/distribution, evaluate natural gas supply prospects and assess ways of promoting direct/indirect access to natural gas in rural communities traversed by South/North pipelines - an Inception Report (November 2014) and an Interim Report (January 2015) were provided. Final report is expected for May 2015. Component C: Assess and Reinforce the Natural Gas Massification Plan Matrix of activities and different actors involved in "natural gas massification (customer base densification), set of objective success/failure criteria of said activities; compilation of major lessons/recommendations - a draft report was provided in December 2014, final report was provided in March 2015 and is currently being reviewed internally. Dissemination – still being planned/discussed with the client. Components D: Revise Existing Natural Gas Transport and Distribution Contracts. Review of existing contracts linked to the transport and distribution of natural gas and recommendations on how to improve them - draft report was provided in December 2014 and final report currently being discussed with the consultant (final revised version is expected for April 2015). Dissemination – still being planned/discussed with the client. Seychelles: Oil The development objective of the project is to 500 Silvana The Bank has been able to accomplish many of the goals set out under and Gas provide time-bound assistance to the Tordo the project. These include: Government of the Seychelles to build capacity  Revision of the petroleum legal system in place. The Bank has and to remove information asymmetries that completed the amendment of the Model Petroleum Agreement. would otherwise impede the Government from This was made possible by experts provided by the World Bank implementing competitive transactions for 7 hydrocarbon development. The technical working closely with experts from the Commonwealth support, beginning ahead of an anticipated 2013 Secretariat. licensing round, would be guided by "good fit"  The Petroleum Taxation Act has been amended to reflect modern international norms and policies and build practices. understanding of operational and administrative  With the involvement of other stakeholders, a new Petroleum issues typically associated with these activities. Licensing approach has been put in place. This involves more transparency and an element of competitive bidding as compared to the previous open door policy. A promotional round was carried out in 2013.  The Bank is currently in the process of harmonizing the Accounting Procedure in the Model Petroleum Agreement to reflect the new Petroleum Taxation Act.  As a result of the reform of the legal and fiscal regime, there has been renewed interest in petroleum exploration activities in the Exclusive Economic Zone. In excess of US $75M has been spent in the last three years on data acquisition and other work program. Residual funding will be applied to support the preparation of a licensing strategy, including interpretation of existing geological data. Togo The TA would support the Government of Togo in 350 Brigitte The EI-TAF is assisting the Minister of Mines and there are in-ongoing the preparation of transparent and non- Bocoum dialogues of 1) detailed issues of the mining code review and agree on discretionary licensing and mineral rights a timetable for Bank's inputs into the joint delivery of the Draft Mining granting in line with the upgraded and modern Legislation to Parliament; and (ii) modalities of Bank's intervention and new Mining Legislation that the TA also sets to the objective to provide constant inputs and updating of the draft help establish at the request of the Government. mining code and regulations in collaboration with the Government True guidance on the proposed reforms and their and provide close monitoring and involvement in the various steps implementation is needed to enable the country including participating in all amendments as they occur. to adhere to international good practice in order  Organize on-site visits to stakeholders and liaise directly at all to enhance competitiveness as well as increase times to obtain their most current inputs on the draft mining the contribution of Extractive Industries (EI) legislation. sectors to sustainable development. The  Draft a first Report which will contain: development objective is to enable Togo to i) a report of points of convergence and establish the basic through the acquisition of 2 divergence of stakeholders; modern operating instruments, namely a new ii) a revision of the draft of Togo’s New Mining Code, Mining Cadaster and a Mining legislation that will in line with best international practices; and make its mining sector internationally iii) a detailed comparison of the fiscal regime in other countries as competitive. The Bank will provide further well as present details on a fiscal regime based on “best assistance to the Ministry of Mines in helping to international practices” cases whether in developed or finalize the new Draft Mining Law while ensuring developing countries. that all key stakeholders are adequately  Finalize the recruitment of the Local Consultant to assist with the consulted in the revision process and that the Togo Mineral Governance and Development Project and begin new legislation offers viable opportunity to data collection. investors interested in phosphates as well as 8 other minerals. The application of best governance practice in defining contractual arrangements and maintaining a modern mining title registry will enable the mining sector to play a strong role in the country's economic development. Uruguay The project’s development objective is to 350 David This project emerged to provide a quick response to the Uruguayan strengthen the legal and regulatory framework Reinstein government's request for assistance in the oil and gas sector reform and build up the institutional capacity in the oil agenda and existing efforts to strengthen the legal and regulatory and gas sector in Uruguay by providing access to framework and build up the institutional capacity in the sector. Since expert advice and international good practices. the management approval of the concept in August 2014, the team The way in which the oil & gas sector is managed has been to Uruguay on mission 3 times and progress has been matters for economic growth and social made towards the project's implementation: outcomes. More effective governance maximizes Component A: Bolster the Uruguayan government's capacity to the development impact of hydrocarbons’ organize and manage the III Uruguay Round. Review of Uruguay extraction and contributes to a more sustainable Round I and II and recommendations for the design of Round III - initial and inclusive mineral rents’ distribution. discussions and advice has been given during missions, draft report is Moreover, supporting the Uruguayan expected to be delivered in April 2015 and final report is expected to government’s governance capacity of its oil & gas be delivered in May 2015. Comparative analysis of the existing PSAs sector at an early stage potentially avoids abrupt and recommendations - draft report was delivered in December 2014, policy adjustments, fosters accountability, final report currently being reviewed and expected to be delivered in promotes more equitable results (and wealth May 2015 distribution) and supports environmental and Component B: Strengthen the legal and institutional framework for social sustainability. the oil & gas sector in Uruguay. Comparative review of the existing legal and regulatory framework for hydrocarbons - draft report was delivered in December 2014, final report currently being reviewed and expected to be delivered by end of April 2015; Evaluation of existing institutional capacity, assessment of institutional framework and action plan for building up institutional capacity - initial discussions and advice has been given during missions and through e-mail exchange, inception report has been delivered in February 2015, final report is expected to be delivered in May2015 Component C: Assist the government in preparing a sustainable development policy and strategy for the oil & gas sector. Workshop in Montevideo on institutional and legal/regulatory framework - successfully completed on November 13 and 14, 2014; International Conference in Montevideo on environmental and social impacts of offshore oil & gas - successfully completed on November 19 and 20, 2014; Recommendations for a Roadmap for the development of a National Hydrocarbons Policy/Strategy - initial discussions and advice has been given during missions and through e-mail exchange, final report is to be given in April/May 2015; Recommendations for a 9 draft National Hydrocarbons Policy/Strategy - initial discussions and advice has been given during missions and through e-mail exchange, final report is to be given in April/May 2015. Uganda Ministry of Energy and Mineral Development is 300 Bryan The proposed objective for this activity is to improve GoU’s ability to planning a new round of mineral licensing for Christopher attract and manage private investments in the mining sector through: various areas across the country. Therefore, legal Land (a) legal assistance for assuring greater compliance and enforcement assistance is needed for amending the Mining Act of investor obligations under licenses; and (b) technical assistance with and associated regulations in a manner that creating data packages aimed at promoting bidding by private assures greater compliance and enforcement of investors investor obligations under licenses. Also, technical assistance is needed to create data packages aimed at promoting bidding by private investors for highly prospective mining exploration areas identified from recently- acquired airborne and geophysical data. 10 Annex Table 1b: Extractive Industries Technical Advisory Facility (EI-TAF) Active Global/Knowledge Activities Project Title Brief Description Approx. Approval Task Team Status Grant date/ Leader Amount closing US$000’ date Mining EI-TAF will leverage a EUR 500k and US$200k 300 Martin Through a competitive process on June 10, 2014, the Bank selected Governance financing contribution by the GIZ in developing Lokanc and hired Adam Smith International (ASI) UK, a consulting firm to Assessment in and disseminating the Mining Governance assist the Bank in implementation of Mining Governance Assessment African Assessment (“MGA”): a global knowledge (MGA) project. The objective of the MGA is to assess governance Countries product on extractive industry sector issues that quality particularly relevant to mining and mining sector (MGA) will help address the lack of quantitative and competitiveness and attractiveness. The project is well underway and verifiable fact-based information regarding the Consultant has submitted the inception report and completed a sector governance and management. customer consultation study. The scoping study report (a major deliverable of the project) including methodology and questionnaire The MGA will assist governments to monitor the to be used during interviews has been submitted and is currently effectiveness of mining sector policies and under review and discussion. Major milestones of the project are institutions in charge of supporting and reviewed and discussed during regular technical committee meetings implementing them, and benchmark results established by the World Bank. The first country assessment is and/or approaches against other countries. planned in March 2015, followed by another 7 country assessments that are all to be completed by December 2015. Should the project The project is proposed in two phases with the continue to Phase 2, it is anticipated that further funding will be first phase sub-divided into two sub-phases. provided through EI-TAF (or its successor trust fund). The German Phase 1a will perform the scoping study and government also plans to provide additional funds if so required. proposed methodology for the pilot application of the MGA to eight pre-selected countries. The scoping study and, in particular, the proposed methodology will be reviewed by a World Bank Technical Committee before proceeding to Phase 1b. Once the methodology is ratified, Phase 1b will proceed to perform the assessment on eight countries of varying mining sector maturities in Africa. Subject to World Bank approval, funding may then be made available and the contract extended to continue to Phase 2 where the methodology will be applied to remaining 12 countries and a final report published. Global A key objective of the Global Capacity Building 525 Martin The World Bank team clarified that direct negotiations on behalf of a Capacity Program on the Negotiation of Mine Lokanc and government represents a liability and reputational risk for the Bank so Building Development Agreements is to enhance local Noora EI-TAF funds are used only for preparation for negotiation. EI-TAF Program on knowledge and skills of relevant government Arfaa focuses on building capacity of the countries to negotiate on their 11 the representatives, through Regional Centers of own. The objective is to train developing country governments on the Negotiation of Excellence, to enable them to negotiate mineral effective negotiation of mining contracts with foreign investors. The Mine development agreements that are: i) aligned with Bank and EI-TAF donors would like to build capacity of regional centers Development international norms and standards; ii) facilitate of excellence to prepare governments for contract negotiations, and Agreements sustainable development; and iii) protect the possibly eventually transfer management and coordination of regional stability of investment conditions. The capacity capacity building on to them. To build global capacity on the building program will employ a ‘training of negotiation of mineral development agreements, the World Bank trainers’ approach, whereby Regional Centers of hosted two regional training workshops that brought together Excellence will be identified and over time their government representatives from 18 countries. In May 2014 the first capacity to train relevant stakeholders within workshop was held in Arusha, Tanzania with 35 representatives from their specific region to negotiate mineral Anglophone Africa including from Sierra Leone, Tanzania, Ethiopia, development agreements will be strengthened. Zimbabwe, Mozambique, Liberia, Uganda, Malawi and Rwanda. The The aim of this approach is to strengthen the second training workshop for Francophone Africa was held in long – term sustainability of results and to ensure Ouagadougou, Burkina Faso in October 2014 and included 35 that the training provided through the program is representatives from countries spanning Senegal, Congo, Burkina contextually relevant. Faso, Guinea, Mali, Niger, Togo, Madagascar and Mauritania. A third workshop is being organized in Tunis and is scheduled for April 20-24, Phase 1 of the program will aim to achieve these 2015. objectives through the following four key components: 1) Regional Centers of Excellence - This component focuses on the identification of Regional Centers of Excellence that can eventually take the lead on building capacity around the negotiations of mineral development agreements. During this initial phase of the program, two to three centers of excellence will be identified (one-two in Africa and one in Latin America). Experts from the regional centers will participate in both the development of training modules and the delivery of workshops. 2) Training Modules - The development of Module 1 training resources on contract negotiations in three languages (French, Spanish, English), using the Model Mining Development Agreement (MMDA) as the basic framework. 3) Workshops - The delivery of three capacity building workshops in Latin America (1) and Africa (2), targeting government officials in relevant ministries, using Module 1 (above). The workshops will provide immediate training to the target audience (relevant government officials) 12 on contract negotiations, in addition to building the capacity of the Regional Centers of Excellence to deliver workshops on the own. 4) Program Evaluation - An evaluation of progress made and lessons learned, aimed at providing input into phase two of the program. 13 Annex Table 2a: Extractive Industries Technical Advisory Facility (EI-TAF) Pipeline Country-Level Activities Country Background Proposed Objectives Sector Implementation Approx. Period Grant (estimate) Amount US$000’ Armenia The specific issues to be addressed through EI-TAF support Preliminary discussions were held Ministry of Mining FY15-16 350 Mining Sector are: Energy and Mining Department on the three Assistance  Developing detailed mining regulations to support the previously discussed components of an EI-TAF new mining law; in particular with regards to tailings Grant. There was agreement that all three issues management were very important and urgent, given that new  Assess key social and environmental challenges in the developments in the sector were being delayed sector due to opposition to mining that was partially  Organizing multi-stakeholder workshop on mining to due to the lack of regulations, which in turn better understand the sector issues. compounded the mistrust of some stakeholders for all mining activities. Guatemala Since 2006, mining production has grown significantly in The development objective is to strengthen the Mining FY15-16 550 Mining Sector Guatemala. Foreign direct investment in mining by companies capacity of the Guatemala Ministry of Energy Assistance such as Solway Investment Group and Mayaniquel has also and Mines for data collection and early increased substantially: Just in 2013-2015, Guatemala is set to community engagement for mining projects. receive over $3.8 in mining investments. All this interest has This would be done through two main strained the government’s institutional and regulatory capacity. components: (A) Strengthening systems of the Vice-Ministry of Mines and the National Directorate of Mines (DNM) for storing and generating geological and licensing information; and (B) Strengthening of the capacity of the Vice-Ministry of Sustainable Development to manage and provide guidance related to early stage mining exploration consultations between companies and mining communities. The intermediary outcome of component A would be an inventory of current data and practices as well as enhanced capacity to cross-reference and analyze data from companies. The intermediary outcome of component B would include increased knowledge and capacity for implementation of early stage mining project community consultations. Both components would include sharing of international best- practice and training. 14 Papua New Bougainville Government The Autonomous Bougainville Government Mining FY15-16 550 Guinea (ABG) has requested US$ 1 million for technical and legal advisory services related to the process of reopening the Panguna mine. The request must receive formal endorsement of the PNG Government before it can be considered by the Bank. This endorsement is pending. Somalia The objective of this particular activity, for which EI-TAF The proposed operation consists of two main Oil & Gas FY15-16 550 (Extractive Industries Technical Assistance Facility) support is activities: requested, is to support: 1) legal, regulatory and fiscal Legal, Regulatory and Fiscal Framework Review framework review for oil and gas sector in Somalia and 2) for Oil and Gas Sector. This activity will be capacity building for the negotiations of petroleum contracts. performed in two phases: Phase I (to be supported by EI-TAF): (i) Review of Somalia’s existing petroleum framework to identify all areas in need of update in the legal, regulatory and fiscal framework applicable to the petroleum sector. (ii) Potential fiscal impact study to identify inconsistencies in the legal, accounting, tax and customs regulations and analyze the relevance of fiscal terms with respect to the attractiveness and the geological structure of the Somali basin. Phase II (to be supported by Somalia MPF): (i) Guidance to the competent authorities for updating the legal, regulatory and fiscal framework; (ii) Finalization and follow-up training on the financial/economic model for the petroleum sector. Capacity building for the negotiation of petroleum contracts. The activity is divided in two phases: Phase I: formal classroom training on (to be supported by EI-TAF): (i) Fundamentals of the oil & gas industry (2 weeks; 15 participants); (ii) Understanding oil & gas industry contracts (2 weeks; 10 participants); (iii) Macroeconomic considerations of developments in the oil & gas sector (2 weeks; 5 participants); (iv) Negotiating, drafting and management of oil & gas contracts (2 weeks; 10 participants) Phase II: on-the-job training and guidance on (to be supported by the Somalia MPF): (i) On-the- 15 job mentorship for the FGS Management Team and (ii) On-the-job mentorship for Project Economics Team Tanzania Oil and gas sector Competitive bids for offshore oil and gas Oil & Gas FY15-16 300 (Zanzibar) development 16 Annex Table 2b: Extractive Industries Technical Advisory Facility (EI-TAF) Pipeline Global/Regional/Knowledge Activities Country Background Proposed Objectives Sector Implementation Approx. Period Grant (estimate) Amount US$000’ African The African Mining Legislation Atlas (AMLA) is a legislation The activities to be financed by EI-TAF include, Mining FY15-16 350 Minerals gathering, dissemination and capacity-building project. It the production of a version of the guiding Legislation includes: template referred to in (ii) above which will Atlas (AMLA) (i) collecting, processing and storing all Africa’s mining assist the Bank in assessing the quality of a laws and regulations into a free online ICT platform country’s mining legislation as part of its lending database to be curated by an African mining law entity and transparency programs and implementation with interactive features to provide comparative data, of the training of African lawyers and advanced (ii) elaborating a guiding template with a menu of options law students from across at least ten countries and examples for the full range of issues covered under representing all five geographic regions of Africa a mining law, and for the population of the platform described in (iii) training, technical assistance and capacity building for (i) above as well as strengthening of local legal the sustainability of the platform and the strengthening expertise in mineral law as described in (iii) of local legal expertise in mining law practice and above. research. The Project is developed through the collaboration of the Legal Vice Presidency, Energy and Extractives Global Practice, and Governance Global Practice of the World Bank Group in partnership with the African Legal Support Facility (ALSF) and the University of Cape Town (South Africa). Other stakeholders, including participating law faculties of select African Universities. The alpha version of the platform which was development in the pilot phase of the Project is available at www.a-mla.org. A summary of the pilot year is available at http://globalforumljd.org/themes/cops/african_mining.htm. Massive Open Oil, gas and minerals generate vast rents, which are larger than The envisaged MOOC would build knowledge to Oil, Gas FY15-16 100 Online Course official development assistance in several producing countries. make the most of oil, gas and minerals and help and (MOOC) on If used prudently, these one-off rents can sustain development contribute to ongoing efforts to maximize the Mining Good efforts and make a lasting positive impact on the life of citizens. benefits associated with non-renewable natural Governance of However, the very same rents have the potential to destabilize resources while mitigating the risks that they Oil, Gas and public financial management systems and increase the risk of bring. It would cover important policy decisions Minerals for corruption. that resource‐rich countries must face. Subject Sustainable to further discussion, the following topics would Development be covered: the fundamentals of oil, gas and mining; the project development process; legal 17 frameworks and contracts; fiscal regime design; local content; social and environmental issues; revenue management; extractives‐linked infrastructure; and spending resource revenues for economic diversification and development. Transparency and accountability would be cross‐ cutting themes of the MOOC. Sessions would be cohesive throughout the course but also accessible in shorter or individual modules. MGA The MGA project has been progressing well with support from Funding sought for final contract costs, Mining FY15-16 350 Supplemental EI-TAF and bilateral support from the German government. communications/branding, and follow-up on the Financing There are some final expenses to be covered related to the mission to Zambia. contract, communications and branding, and follow-up from the mission in Zambia before the closing date of EI-TAF. 18 Annex Table 3: Extractive Industries Technical Advisory Facility (EI-TAF) Closed Projects8 Project Title Brief Description Approx. Approval Task Team Status Grant date/ Leader Amount closing US$000’ date Kenya: Oil and Ministry of Energy (MOE), acting as the policy 600 Alexander The activity was closed in July 2014. The EI-TAF grant was Gas Legal maker and regulator for the industry, does Huurdemann intended to support the following activities: 1) Technical Framework not yet have the experience needed for assistance and capacity building to the Ministry of Energy on negotiation of natural gas contracts. A the development of gas terms for exploration and production number of exploration licenses for offshore contracts and negotiation practices, based on international best blocks have been issued. There is an practice, which will attract private investments while expectation that these blocks will be mostly maximizing the Government take from future production gas-prone and a number of international oil revenues; 2) Review of the current petroleum legal and and gas companies have asked the MOE to regulatory framework with a view of bringing it in line with best propose gas terms for the contracts prior to international practices for future developments and signing exploration contracts. However, the engagements with oil and gas exploration; 3) Technical Ministry of Energy has asked for more time assistance to the Government of Kenya in drafting a on account of its lack of experience in comprehensive petroleum policy and, 4) Support to the negotiating gas terms. Therefore, Ministry of Government of Kenya to raise its awareness about the gas Energy has requested funding from the sector and to enhance its preparedness to deal with the risk of Extractive Industries Technical Advisory spills during offshore exploration for oil and gas. The activities Facility (EI-TAF) managed by SEGOM were phased with the objective to prepare gas terms at earliest opportunity in support of the Government’s negotiations with the private sector. This activity is now completed and an Activity Completion Summary was approved by SEGOM Management on February 12, 2014. This was a very successful engagement. The Inter- Ministerial Technical Committee, in consultation with the State Law Office of Kenya, is preparing the Petroleum Bill that will incorporate all recommendations made to the Government of Kenya. In addition, the World Bank is preparing the Kenya Petroleum Technical Assistance Project (KEPTAP), a US$50 million IDA credit supplemented by a US$19 million DFATD (Canada) grant with the project development objective to strengthen the capacity of the Government of Kenya to manage its petroleum sector and wealth for sustainable development impacts. 8 This list does not include Yemen project as there is no grant signed. 19 Kyrgyz Republic: In the Kyrgyz Republic, EI-TAF financed a full 333 Gary The activity was closed in June 2013. The review was undertaken Mining Sector review of the mining investment climate, McMahon and shared with the authorities, followed by a three-day seminar TA including a review of licensing, legal, regulatory to build capacity around mining legislation, regulations, fiscal and institutional arrangements in support of the arrangements, and on mining tender procedures. A detailed study Togolok Gold Tender. Phase one will be Bank- on tender procedures for mining was undertaken and also shared executed and will focus on providing capacity with the Government. This was followed by a detailed analysis of building to MNR and other mining sector the value of the Togolok resource. A scoping study of mining stakeholders on the country’s legal and community engagements in Kyrgyz republic was also conducted regulatory frameworks in the minerals sector. and a framework for further engagement proposed. Particular Due diligence of the mineral deposit will also be attention was paid to social issues around the Togolok deposit. In conducted during this stage of EI-TAF. addition, a one week workshop on tendering small mineral This phase will finance 2 workshops, focusing on deposits was given to the staff of the main mineral agency as well a review of the legal/regulatory framework, and as mining related staff in the Ministry of Economy. An on the community engagement/social aspects of advertising/communication agency was also engaged to provide the mining sector, respectively. A total budget of assistance with the promotion of the tender. This work was close US$300,000 is proposed. Provided that Phase one to completion when Phase 1 ended. Note that while all of the initial results are positive, EI-TAF will move to activities for Phase 1 were completed, due to numerous changes in Phase two. Phase two will finance advisors and the directorship of the mining agency, the phase took 2 ½ years to workshops required to accomplish the proposed complete. objectives regarding carrying out the mining The Government of the Kyrgyz Republic has begun to tender tender and achieving the outcome of a successfully some very small deposits and is looking forward to structuring mining (namely gold) public offerings Phase 2 to provide further assistance in tendering the Togolok (tender/auction), compiling a competitive and deposit. Given the ongoing political difficulties confronting the transparent tender package and capacity building mining sector in the Kyrgyz Republic, the Bank manager decided to of involved stakeholders, focusing mainly on staff cancel Phase 2 from the MNR. This phase will be Recipient- executed and will start 6-9 months after launch of Phase 1. Liberia: Support The objective of this project is to assist the 1,000 Daniele La This activity was closed in October 2011. This project has been from Extractive Government of Liberia to (a) build capacity with Porta successfully and fully implemented. Lessons learned included: Industries - contract negotiations and management of mining Individual contract negotiations can inform wider legal and Technical concession process, and (b) move three identified regulatory reforms. Transaction’s close is not easily predictable as Advisory Facility extractive industries transactions towards it depends on several factors outside the grant's control. So the contractual close. The Grant will provide ambitions of the Grant should be limited to capacity building rather technical advice on due diligence and evaluation than promising that a deal will close because of the technical of mining proposals, make recommendations on support. The long term benefits of the grant cannot be achieved if selection of proposals and on the required the Client does not have a stable team for negotiations. The overall regulatory adjustments to provide level playing outcome was a repository of information on all aspects of mining field for future investors. It will also provide concessions, an iron ore cash flow model to be used in negotiations capacity building to improve sector governance. to test the impact of various decisions on economic returns, and recommendations for follow up reforms. The outcome is likely to be sustainable because the government has already embarked on 20 some of the recommended reforms. The Grant has substantially improved government's ability to analyze investment proposals and negotiate concessions. EI-TAF has helped to attract new resources: WB additional financing for EGIRP ($1.6 million), USAID GEM project (about $8 million allocation to capacity building on concessions; GIZ (mineral governance project and EITI). The database of reports and background documents related to the project served a knowledge exchange tool. It is available on-line to authorized users. EI-TAF findings played a major role in government's decision to review the legal and regulatory framework of the mineral sector. Coordination by the client is very important for successful implementation. Where capacity is weak, consideration should be given to hiring a single firm to do the coordination and quality control. Government needs to understand the limitations of the grant and request it only when transactions are close to being finalized. EI-TAF findings should have a follow up to address policy shortcomings. The grant size may be inadequate for countries like Liberia, Sierra Leone, and Guinea where multiple transactions worth several billions of dollars are being considered. To be effective, the grant should be provided to complement ongoing programs rather than as a stand-alone assistance. Given the rapid-response nature of the grant and the need to support transactions that are driven by the private sector, Bank normal approval procedures (particularly for procurement clearance) need to be flexible and responsive to client needs. Mauritania: Gas- In line with the objective of EI-TAF to provide 400 Silvana The activity was closed in June 2014. A law firm specialized in to-Power transaction-oriented consulting services, the Tordo energy related transactions was hired in February 2012, and has Negotiations activities under this project will finance capacity been working alongside the GoM negotiation team to help review Technical building aimed at moving the identified the legal and regulatory structure necessary to implement the Assistance transactions towards contractual closing. In project. The project implementation schedule originally envisaged Project particular, Consultants will assist the Government by the project sponsors suffered some delay, owing to difficulties in of Mauritania’s (GoM) negotiation team in: (i) agreeing on the sizing and siting of generation and distribution structuring and reviewing the contractual infrastructure. These difficulties were overcome in January 2014. In arrangements related to the GoM’s participation addition to advisory services, four reports have been delivered to in the power utility company; (ii) reviewing the the government: initial due diligence of contractual regulatory terms of the Gas Supply and Purchase framework; summary of abuse contractual arrangements; but Agreements; (iii) reviewing the contractual initial due diligence of the legal and regulatory implications of the arrangements related to the construction and properties to contractual structure; and final due diligence and operation of the power plant; and (iv) defining analysis of residual risks. negotiation strategies. However, negotiations will be conducted by the GoM’s negotiation team without the participation of the Consultants. The 21 Consultants will also develop recommendations on the required legal, regulatory, licensing, and fiscal adjustments driven by the transaction. Mexico: This project aims to achieve the following 179 Daniele La This activity was closed in August 2012. All activities under this Royalties objectives: 1) Support an assessment of Mexico’s Porta project have been successfully implemented. Some of the Reform for the legal, fiscal and regulatory framework for the highlights from this project include: (i) Royalty Options Based on a Mineral Sector adoption of a new fiscal regime for the mining long- list of best practice “royalty” options identified and presented sector – in response to a rapid increase in in- by the World Bank team, three fiscal options were jointly selected bound investments; 2) Build capacity around by the Secretaria de Economia and Secretaria de Hacienda. A international best practices on fiscal reforms for detailed roadmap was prepared and discussed with Secretaria de the mining sector with the consideration of the Economia listing the alternative steps that would be necessary for adoption of mineral royalty instruments vis-à-vis the implementation of a royalty scheme. After the selection of the the Mexican framework in response to a rapid royalty type, a selection of the best legal approach to carry out the increase in inbound investments; 3) Support an necessary reforms was presented. (ii) Community development assessment and build capacity around the investment In discussions with policy-makers there was a strong implications for the adoption of royalties and preference not to create a new statute requiring a tax revenue other fiscal regimes for different Mexican distribution system, but an acceptance that direct investment by stakeholders; and 4) Support the preparation of a miners in mining community development should be encouraged. consultation roadmap for the adoption of a new The proposed example legislation presented in the report was fiscal regime for the mining sector. discussed and a roadmap was prepared, taking into account the different options and respective timetable for the fiscal reform. (iii) Amendments to mining law and regulations The review of Mexico’s current fiscal regime for the mining sector identified the need for updates to the current mining law and regulations so that the sector is in line with best international practices. Mozambique: Aimed at addressing immediate regulatory and 735 Ekaterina In November 2011, the Ministry of Mineral Resources requested to Extractive capacity bottlenecks towards successful Mikhaylova include a new eligible activity for this grant – specifically support Industries- negotiations of new mineral development for liquefied natural gas (LNG) infrastructure negotiations. As a Technical agreements, the activities under this project result, the grant closing date was extended until 2014 to allow for Advisory Facility include: (a) supporting government's sufficient time for implementation. The envisaged support for negotiations and technical teams on Chibuto negotiations off Chibuto mineral sands project had to be cancelled, Mineral Sands Project tender; (b) updating since there was lack of investor interest in the deposit after the bid mining cadastre to enable issuance of large-scale was announced. Support for legal and regulatory regime was mining licenses through tenders in accordance undertaken under parallel projects (successfully completed but with regulations; and (c) updating the current without using EI-TAF funding). The project has now completed and legal and regulatory framework for the was officially closed in September 2014. The project supported management of large-scale mining associated negotiations of LNG plant with Anadarko (completed) and mining with the tender. cadastre update (also completed) Pakistan Launched in August 2011, the EI-TAF assistance 466 Daniele La The project was closed in October 2011, in coordination with (Balochistan): to the mineral rich province of Balochistan Porta Balochistan and federal counterparts, the World Bank team carried Technical focuses on building capacity in one of the out the first two workshops to introduce global norms of large- Advisory Facility country’s most impoverished and perhaps scale mineral development to a mix of policymakers, civil society 22 unstable regions, where if structured properly, representatives, media reps, and community leaders. The the mining sector could have a significant impact workshop was held in Islamabad and was facilitated by a team of on the economic development of the province mining industry experts, aimed at training key stakeholders on and the communities around a mine. As the global mining norms. provincial government embarks on awarding one In April 2012, the World Bank team hosted, in collaboration with of the country’s first contracts for large-scale other donors, a round table discussion, targeted towards provincial mining, capacity building is in response to a time- secretaries (mining) from around the country and relevant bound proposal for resource developments and representatives of the federal government. The round table was will center on: (a) global norms to establish led by the government and aimed to build capacity around sector governance and support policy formulation, promotion and to establish a forum for dialogue between leading to strong mineral development provinces. All activities were successfully delivered and the grant is agreements and (b) the evaluation of technical now officially closed. reports, including feasibility studies associated with the award of mining concessions. Rwanda: Aimed at supporting the Government of Rwanda 337 David This grant is now closed and a Completion Summary \was Support from in the preparation, negotiation, and finalization Santley submitted in February 2014. The grant provided the required Extractive of a Production Sharing Contract (PSC), this Technical Assistance to the Government of Rwanda for the Model Industries project consists of the following activities: (a) Production Sharing Contract (PSC) and the review of the legal and Technical technical advice on drafting and negotiating PSC, policy framework for the petroleum sector. The consultants Advisory Facility (b) designing an economic/fiscal model to assess provided a clear direction to the Client on the required next steps the fiscal and financial impact of proposed in the development of negotiation, policy and legal capacities. The contract terms under a variety of economic assistance provided by this grant assisted the Government in conditions of the Recipient; and (c) preparation entering into negotiations with private sector better prepared and of a medium-term and final report on the final informed. Currently, the Model PSC is being discussed with the outcomes of PSC. private sector company. While the current resources mobilized by the private sector are mainly targeted to exploratory activities, the prospects for substantial investments are promising and the grant provided a valuation contribution in preparing the Government to enter into those discussions. Sierra Leone: The Grant will finance the services of a multi- 797 Daniele La The project was closed in June 2014. The EITAF grant was Technical disciplinary team of five specialists to build Porta successful in meeting its primary objective of building the capacity Advisory Facility capacity of Government of Sierra Leone (GoSL) to of the Government of Sierra Leone to negotiate new mining review existing mining development agreements agreements that ensure provisions of fair fiscal terms as well as and negotiate new ones. The objective of the compliance with the applicable laws. In addition, it aimed to project is to strengthen the Government's strengthen transparency for the mining companies' operations, capacity to assess time-bound investment compliance with environmental standards and enhanced proposals, review or negotiate terms for mining contributions to local communities. By the closing of the grant, six development agreements (in line with the Mines contracts were reviewed and successfully renegotiated. Grant’s and Minerals Act of 2009), and manage the activities were able to establish a new and improved benchmark concession granting process. under which mining concessions are currently negotiated in the country. It has also provided and addressed a much needed capacity gap within the Government to understand technical, fiscal, 23 environmental and social aspects of contract negotiations. The grant also supported the preparation of a model mining agreement that has been submitted to Parliament but has yet to be approved. 24 Annex 2 Extractives Global Programmatic Support (EGPS) Multi-Donor Trust Fund The World Bank is looking to strengthen its programs through the creation of a multi-donor trust fund for the Extractives Global Programmatic Support (EGPS), to be managed by GEEDR, to support current and emerging resource-rich developing nations in using their oil, gas and mining resources sustainably and transparently for poverty alleviation and sustainable economic growth. The activities of the new trust fund will be coordinated with the work of other Global Practices and Cross-Cutting Solutions Areas where relevant, including Trade and Competitiveness, Governance, Macroeconomics and Fiscal Management, Health, Education, Water, Gender and Fragile and Conflict-Affected States. The EGPS builds on the success of two existing trust-funded partnership programs currently managed by GEEDR: the Extractive Industries Transparency Initiative Multi-Donor Trust Fund (EITI-MDTF) and the Extractive Industries Technical Advisory Facility (EI-TAF). Although EITI-MDTF and EI-TAF enjoy wide support and have been producing robust results, the World Bank and donors have decided to use the opportunity of their closure at the end of 2015 to restructure them into a single MDTF, and expand the scope to accommodate new requirements of the EITI Standard and incorporate lessons learnt from both programs. The new setup will allow to combine reforms along the entire EI Value Chain (under the same financing agreement), thus improving coordination across components, and on balance reducing processing time and cost of preparation, supervision and implementation of projects (as compared to the previous practice of developing separate EITI-MDTF and EI-TAF projects). While the EGPS components were designed to reflect the entire EI Value Chain and facilitate support to clients across each of the chevrons, the setup of the new EGPS will remain reminiscent of the EITI-MDTF and EI-TAF to provide for continuity and keep the products intuitively "recognizable" to partners and clients. The EGPS will be a comprehensive multi-donor trust fund that will increase the flexibility for funding activities beyond the current EITI-MDTF or EI-TAF. The EGPS will increase the effectiveness of the World Bank and partners in addressing challenges in the sector (i.e. address emerging challenges, renew work on existing initiatives, support donor coordination, and collaborate with new actors). The consolidated approach will also allow: (a) flexibility in responding to shifting needs and priorities; (b) economies of scale in program management, monitoring and evaluation, trust fund administration, and communications; (c) improved synergies across partners and portfolios; (d) better coordination and harmonization of procedures and activities that were previously dispersed across TFs; and (e) reduced transaction costs for donors, the World Bank and the clients. The EGPS Components will be as follows:  Component 1: Supporting implementation of the Extractive Industries Transparency Initiative (EITI) and broader reforms on sector transparency and good governance.  Component 2: Building capacity and supporting governments developing sound legal, regulatory, contractual, and fiscal frameworks, contract negotiation, and fiscal management for the extractives sector.  Component 3: Supporting Extractive Industries for Local Economic Development (EILCD)  Component 4: Strengthening institutions for growth through extractive industries  Component 5: Operational support for the Trust Fund 0 EGPS Results Framework: Table 1 shows the EGPS program-level indicative results framework. In addition, detailed component descriptions and component-level indicative results frameworks have been developed for EGPS activities, including for Component 2 (corresponding to EI-TAF). Individual projects would be able to draw on one or several components, and results frameworks for individual projects will include only those indicators that apply. Results frameworks from individual projects will be aggregated on annual basis where possible to provide program level monitoring and evaluation. Such integrated reporting will be disclosed in EGPS MDTF Annual Reports. Table 1: EGPS results framework To improve ability and capacity of current and emerging resource-rich developing nations in using their oil, Development gas and mineral resources sustainably and transparently for poverty alleviation, shared prosperity, objective economic diversification, and sustainable economic growth. ULTIMATE Improved sustainable economic development and inclusive (“pro-poor”) poverty reduction in resource-rich OUTCOME developing countries.        Component 1: EITI and Sector Component 2: Legal, Component 3: Component 4: Transparency regulatory, contractual and Supporting Extractive Strengthening fiscal frameworks, contract Industries for Local Institutions for negotiations and fiscal Content Development Growth through management Extractive Industries Better social and economic performance of the Integration of sound and Improved government’s private sector inclusive revenue ability to apply holistic and operating in and administration and Assisting mineral and INTERMEDIATE OUTCOMES/ PURPOSE fair good practices, around the management practices, petroleum-rich including economic extractives sector, including accountability, countries to identify, development models, in and increased social into national, regional and design, and structuring oil, gas and and economic local systems in resource implement local mining concessions in benefits for local rich countries. content strategies interests of its citizens communities from aimed at maximizing mining, oil and gas Empowerment of economic benefits Establishment and use of operations governments to develop from petroleum and appropriate frameworks evidence based decision mineral resources and mechanisms by Availability of making process that is both through efficient, government to ensure strategies for sustainable and beneficial sustainable, and fiscal and economic responses to to a country’s development equitable economic sustainability of oil, gas emergencies diversification, and and mining projects, including Empowerment of citizens to increased local including avoidance of contingency actively participate in employment race to the bottom and planning and making decisions related to mitigation of resource preparedness for national mineral resources curse governments and and advocate their rights other stakeholders related to extractives 1 Increased knowledge Maintain number of existing Increased number of and awareness of EITI compliant countries countries applying modern local content policy Improved and increase number of policies, laws and design and institutional new countries regulations for extractives implementation frameworks for issues among key management of EI Increase in total value of Growing number of stakeholders global revenues reconciled extractives contracts, Improved government Increase number of annually including community capacity to design and countries using agreements, negotiated monitor local content sector specific Improved quality of EITI using good practices Key Indicators policies contingency reports including more planning and current data, increased Growing number of Increased local preparedness coverage of revenues countries using proper supplier capacity and guidelines (or included in reporting consultation, and culture local employment regulations) and gender sensitive (per country, region, Improved sustainability of grievance redress and disaggregated by Increase number of EITI, including mechanisms for EI projects gender if applicable) ASM projects mainstreaming of EITI, entering formal improved country systems Reduced instances of Growing number of economy reporting on revenues, serious deviations of opportunities for inclusive policies on extractives contracts from women to participate transparency and disclosure overarching fiscal laws and in the economy and provision projects around EI 2