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Belizean hydro dam project and the Canadian International Development Agency

Petition: No. 41B

Issue(s): Environmental assessment and international cooperation

Petitioner(s): Probe International

Date Received: 11 June 2002

Status: Completed

Summary: In this petition, which is a follow-up to petition No. 41A, Probe International sought further information about the Canadian International Development Agency's (CIDA) involvement in a proposed hydro dam project in Belize, Central America. The organization also sought clarification on CIDA's policies related to environmental assessments for foreign projects, particularly hydro dams. The organization submitted 12 detailed questions. 

Federal Departments Responsible for Reply: Canadian International Development Agency

Petition

June 7, 2002

Johanne Gelinas
Commissioner of the Environment and Sustainable Development
Office of the Auditor General of Canada
Attn: Petitions
240 Sparks Street
Ottawa, Ontario
K1A 0G6

Petition #41 Re: Canadian International Development Agency Contract with AMEC for the Chalillo Dam Environmental Impact Assessment Report

Dear Ms Gelinas:

I am writing regarding CIDA's response to our petition no. 41, dated December 4, 2001, to the Commissioner of the Environment and Sustainable Development (pursuant to section 22 of the Auditor General Act) concerning CIDA's involvement in the environmental impact assessment of the proposed Chalillo dam in Belize.

The CIDA-funded EIA in question is now the subject of a lawsuit filed by Belizean groups before the Supreme Court of Belize, and a formal complaint against the company that produced the EIA, Toronto-based AMEC, which was filed by Probe International with the Professional Engineers of Ontario.

In light of the unresolved concerns and controversy surrounding the Chalillo EIA, we find CIDA's May 3, 2002 response to our petition unacceptable. CIDA President Len Good's response only serves as further evidence that CIDA's culture of secrecy and lack of public accountability in dispensing grants to private companies is entrenched and deliberate.

Incredibly, Mr. Good uses semantics to deny responsibility for the CIDA-funded Macal River Upstream Storage Facility [Chalillo] Environmental Impact Assessment, writing that: "CIDA neither hired AMEC to prepare such a report nor did it commission one as suggested in [Probe's] petition."

For the record:

  • CIDA's name is printed on every single page of the 1,500-page report which concluded the Chalillo dam is "both technically and economically viable" and recommended "the most economical option for generating power in Belize."
  • Records obtained by Probe using the Access to Information Act indicate that it was CIDA, not AMEC, that ultimately decided on the EIA timetable, budget, and list of "deliverables." Before signing a contribution agreement with AMEC in June 2000, CIDA sought a recommendation to proceed from the Canadian embassy in Kingston; its Hull-based environment specialist, Michelle Tremblay, reviewed AMEC's proposal in detail, and demanded changes to the study's terms of reference, after initially rejecting the company's proposal because the budget was too high and it did not include and environmental mitigation plan. Eight months later, CIDA program manager, Suzanne Dubois, inexplicably revised the agreement with AMEC, increasing the project budget from $249,378 to $466,234.

Petition Request

With reference to CIDA correspondence (listed below),* we submit additional questions as follows:

  1. In a September 2001 letter, CIDA informed us that it was reviewing the AMEC report "to ensure that the terms and conditions agreed to by AMEC in its Contribution Agreement with CIDA have been met." Does the EIA meet with the terms and conditions set out by CIDA or not? What are these terms and conditions?
  2. Why did CIDA change the terms of reference and increase the EIA budget in April 2001? In addition to the $78,000 CIDA paid AMEC for public consultations in Belize, how was the increase of $138,856 justified by CIDA? How much of this money has been disbursed to AMEC?
  3. In a December 2001 letter to Probe from the Office of the Minister for International Cooperation, Policy Advisor, Genevieve Tremblay, informed Probe that CIDA would respond to our comments on the EIA once CIDA completed its review of the AMEC report. Has CIDA completed its review of the EIA and, if so, does it intend to make this review of the EIA public?
  4. The revised list of deliverables dated April 27, 2001 indicates that CIDA agreed to pay AMEC for new studies, including $24,000 for a water quality final analysis report, $50,000 for an aquatic ecology report, $31,200 for a vegetation and forestry study report, due to be completed June 15, 2001, August 15, 2001 and September 15, 2001, respectively. Were these reports ever delivered to CIDA? If not, why not? If yes, are they available to the public?
  5. CIDA initially insisted that AMEC complete an environmental mitigation plan yet the August 2001 report fails to include this plan. How does CIDA explain this omission?
  6. Did CIDA pay AMEC for the wildlife study report? How much of this went to AMEC's wildlife consultants?
  7. According to a January 18, 2002 letter from CIDA's Office of the President, deliverables #11 and 13 "are due to be submitted by AMEC by February 2002 as CIDA INC has accepted to extend the Contribution Agreement." Have these deliverables been submitted to CIDA by AMEC yet? If not, why not? Why did CIDA INC extend its contribution agreement with AMEC three times?
  8. CIDA refuses to withdraw support for the Chalillo dam project in Belize yet has recently cancelled support for similar studies, including public consultations, for the proposed Bokor hydro scheme in Cambodia. How and why did CIDA decide that the Chalillo hydro scheme in Belize is eligible for CIDA funding and not the Bokor hydro scheme in Cambodia, given that both projects would, if completed, flood critical habitat for rare and endangered wildlife?
  9. What is CIDA's policy on funding studies related to hydro dams?
  10. Does CIDA endorse the guidelines for hydro developers issued by the CIDA-funded World Commission on Dams?
  11. Under what terms and criteria would CIDA reject proposals for funding hydro dam studies?
  12. If CIDA finds the AMEC report fails to meet its terms and conditions, what mechanism doe CIDA have for canceling support for a project and arranging for monies spent to be reimbursed?

We look forward to a response at your earliest convenience.


Sincerely,

[Original signed by Gráinne Ryder]

Gráinne Ryder
Policy Director

[Probe International
225 Brunswick Avenue
Toronto, Ontario
M5S 2M6]

*[not available]

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Minister's Response: Canadian International Development Agency

October 28, 2002

Ms. Gráinne Ryder
Policy Director
Probe International
225 Brunswick Avenue
Toronto, Ontario
M5S 2M6

Dear Ms. Ryder:

I am writing regarding your petition no. 41B, dated June 7, 2002, to the Commissioner of the Environment and Sustainable Development, pursuant to section 22 of the Auditor General Act, and received by my Office on July 2, 2002.

Officials from the Canadian International Development Agency thoroughly examined the issues you have raised. Please find enclosed a point by point response.

Yours sincerely,

[Original signed by Susan E. Whelan, Minister for International Cooperation]

The Honourable Susan E. Whelan, P.C., M.P.


CIDA Response to Probe International
Petition no. 41B

  • No. 1: In a September 2001 letter, CIDA informed us that it was reviewing the AMEC report "to ensure that the terms and conditions agreed to by AMEC in its Contribution Agreement with CIDA have been met." Does the EIA meet with the terms and conditions set out by CIDA or not? What are these terms and conditions?

    CIDA's internal review determined that the EIA produced by AMEC met all the conditions of the Contribution Agreement. The Agreement and the EIA Report are accessible, in accordance with the Access to Information Act, through CIDA's Access to Information Unit (ATIP). Ms. Andrée Potvin, Manager of CIDA's ATIP Unit, may be contacted at 200 Promenade du Portage, Place du Centre, 12th Floor, Hull, Quebec K1A 0G4, telephone: (819) 997-0846, to obtain a copy of the Contribution Agreement or the EIA Report.

  • No. 2: Why did CIDA change the terms of reference and increase the EIA budget in April 2001? In addition to the $78,000 CIDA paid AMEC for public consultations in Belize, how was the increase of $138,856 justified by CIDA? How much of this money has been disbursed to AMEC?

    The terms of reference were expanded to allow AMEC to carry out additional studies that were judged pertinent to the decision-making process that would follow the EIA. The approved amount of the Contribution Agreement had been fully disbursed by CIDA as of July 28, 2002.

  • No. 3: In a December 2001 letter to Probe from the Office of the Minister for International Cooperation, Policy Advisor, Genevieve Tremblay, informed Probe that CIDA would respond to our comments on the EIA once CIDA completed its review of the AMEC report. Has CIDA completed its review of the EIA and, if so, does it intend to make this review of the EIA public?

    CIDA has completed its review of the EIA, a copy of which may be requested pursuant to the Access to Information Act.

  • No. 4: The revised list of deliverables dated April 27, 2001 indicates that CIDA agreed to pay AMEC for new studies, including $24,000 for a water quality final analysis report, $50,000 for an aquatic ecology report, $31,200 for a vegetation and forestry study report, due to be completed June 15, 2001, August 15, 2001 and September 15, 2001, respectively. Were these reports ever delivered to CIDA? If yes, are they available to the public?

    These reports have been delivered to CIDA and may be requested pursuant to the Access to Information Act.

  • No. 5: CIDA initially insisted that AMEC complete an environmental mitigation plan yet the August 2001 report fails to include this plan. How does CIDA explain this omission?

    This question refers to the deliverable known as the risk assessment report, which was submitted by AMEC.

  • No. 6: Did CIDA pay AMEC for the wildlife study report? How much of this went to AMEC's wildlife consultants?

    CIDA paid for the wildlife study report. CIDA manages its contribution agreements in reference to specific deliverables. CIDA does not monitor the contractual relation between the company that signed the Contribution Agreement and its consultants or any subcontracting party.

  • No. 7: According to a January 18, 2002 letter from CIDA's Office of the President, deliverables #11 and 13 "are due to be submitted by AMEC by February 2002 as CIDA INC has accepted to extend the Contribution Agreement." Have these deliverables been submitted to CIDA by AMEC yet? If not, why not? Why did CIDA INC extend its contribution agreement with AMEC three times?

    CIDA has now received all deliverables. It is not unusual in most circumstances to approve any reasonable request for changes related to the delivery dates of deliverables.

  • No. 8: CIDA refuses to withdraw support for the Chalillo dam project in Belize yet has recently cancelled support for similar studies, including public consultations, for the proposed Bokor hydro scheme in Cambodia. How and why did CIDA decide that the Chalillo hydro scheme in Belize is eligible for CIDA funding and not the Bokor hydro scheme in Cambodia, given that both projects would, if completed, flood critical habitat for rare and endangered wildlife?

    CIDA has repeatedly maintained that it is neither a proponent nor an opponent of the Chalillo dam project. There is no relationship between the Chalillo project and the Bokor project. Each proposal received by CIDA is reviewed on its own merit and decisions are made accordingly.

  • No. 9: What is CIDA's policy on funding studies related to hydro dams?

    For new proposals submitted to CIDA for the funding of studies related to hydro dams, CIDA requires that

    1. at the project proposal stage, substantial developmental benefits of each dam be identified in detail;
    2. the company conduct, as the first deliverable, a preliminary assessment of the potential positive and negative developmental impacts, and hold public consultations on its preliminary assessment. This should include information regarding: (i) parks/protected areas affected; (ii) endangered species affected; (iii) resettlement (and if so, to World Bank standards); and (iv) public consultation results;
    3. the company make initial and full EAs, and social impact studies, available on the Internet prior to public consultations.

  • No. 10: Does CIDA endorse the guidelines for hydro developers issued by the CIDA-funded World Commission on Dams?

    The Government of Canada has not taken a position on the Commission's report.

  • No. 11: Under what terms and criteria would CIDA reject proposals for funding hydro dam studies?

    Please refer to no. 9 above.

  • No. 12: If CIDA finds the AMEC report fails to meet its terms and conditions, what mechanism does CIDA have for cancelling support for a project and arranging for monies spent to be reimbursed?

    The EIA submitted by AMEC meets the terms and conditions of the Contribution Agreement. In general CIDA may terminate a Contribution Agreement at any time under the standard provisions of the Agreement.