What is biodiversity?

3. Biodiversity What is biodiversity? • The variability among living organisms and the ecological complexes of which they are part, including diversity within species, between species and of ecosystems • The three commonly recognized levels of biodiversity are ecosystem, speciesand genetic  Smithsonian Institution, Carlton Ward  Smithsonian Institution, Carlton Ward

4. Biodiversity Biodiversity and human welfare • Provides direct benefits in the form of goods or products such as food, water, timber, clothing materials and medicine • Also provides less tangible benefits, including the ecological services upon which human survival depends, such as watershed protection, carbon storage, pollination and nutrient recycling • Genetic diversity helps create new crops or animal varieties and pharmaceuticals • Also provides important cultural, spiritual and aesthetic benefits  Conservation International

5. Biodiversity Addressing threats to biodiversity • Biodiversity is under greater threat than ever before from human activities • Society is beginning to respond to this threat inmany ways: • U.N. Convention on Biological Diversity (1992) • National Biodiversity Strategies and Action Plans • Increase in the numbers and area covered by protected areas around the world • National legislation and regulations • Civil society actions

7. Biodiversity Protecting biodiversity • International, national, local protected areas • Now about 96,000 protected areas worldwide, covering nearly 11 percent of the Earth’s surface • Range from areas strictly designated for conservation and off-limits to most human activity to areas managed for the use of natural resources or recreation • IUCN Management Category System helps to create a common language • Not all areas with high biodiversity values are protected • Governments and NGOs have created additional systems of prioritization, to identify important areas for biodiversity conservation

8. Biodiversity Biodiversity is an integral part of sustainable development. • It cannot and should not be considered in isolation • Must be managed in conjunction with other issues, such as social and economic considerations, pollution and health • For example, many biodiversity-rich areas overlap with the traditional lands of indigenous people  Conservation International

9. Prove Commercial Hydrocarbons Start Production End Production Acquire Concession Restoration Production, maintenance and transportation Risk Assessment studies Seismic and drilling Drilling and construction Pre-bid Exploration and Appraisal Development Operations Decommissioning Oil and Gas The Oil and Gas Project Lifecycle

10. Oil and Gas Meeting global energy demand • World energy demand is expected to grow by 66% by 2020, with demand for natural gas doubling in that time frame (IEA World Energy Outlook, 2002) • In the short and medium term, much of that demand will be met by oil and gas • Natural gas will be an important bridging fuel to a renewable energy mix mix • Challenge to society: Ensure continued global development while managing oil and gas activities to minimize long-term disturbance to valuable ecosystems  BP

11. Energy and Biodiversity • Growing tension between energy needs and biodiversity values • Many areas that are potentially valuable for oil and gas are also recognized for biodiversity values • Oil and gas development can have a wide range of impacts on biodiversity  Conservation International, Haroldo Castro

12. Energy and Biodiversity • Challenge to energy companies:Find a way to meet public demand for abundant, low-cost oil and gas products and, at the same time, meet society’s expectations for corporate social and environmental responsibility, including biodiversity protection • Challenge to conservation organizations:Because there is a balance to be struck between economic development and the conservation of biodiversity, be a strong voice for biodiversity protection while seizing appropriate opportunities to partner with industry  BP  Smithsonian Institution, Carlton Ward

13. The Role of National Governments • Energy companies and conservation organizations cannot solve biodiversity problems on their own • Government officials shape and implement conservation strategies and set priorities • In some cases national oil companies control most of the production in a country • Governments face the challenge of balancing economic growth and development with biodiversity conservation • Companies and NGOs should work closely with government officials to encourage them to play a leading role in conservation

15. Building the Business Case What is the business case for integrating biodiversity into oil and gas development? • Based on a company’s values and principles • “It’s the right thing to do” is a starting point for many companies • Grounded in risk management  BP

16. Building the Business Case • Biodiversity issues ARE identified and addressed at the project level: Company of choice for governments, investors, business partners and employees Positive corporate reputation as a responsible operator Limited project delays and enhanced relationships with local stakeholders Continued access to key business resources

17. Building the Business Case • Biodiversity issues ARE NOT identified and addressed at the project level: Negative corporate reputation as an irresponsible operator Project delays, unexpected costs and conflicts with communities, government and NGOs Long-term constraint on future business opportunities Diminished access to key business resources

18. Integrating Biodiversity into Management Systems How can companies integrate biodiversity considerations into their systems and operations? • By integrating biodiversity considerations into both project- and corporate-level environmental management systems (EMS) and the environmental and social impact assessment (ESIA) process • By having a valid and transparent risk assessment process to manage and conserve biodiversity

21. Integrating Biodiversity into Management Systems Environmental and Social Impact Assessment • In some countries, impact assessment is managed by governments, in others, companies are responsible • The CBD recommends evaluating impacts at all levels, encompassing the appropriate temporal and spatial scales of impacts, values for affected people, mitigation requirements and the need for stakeholder participation • ESIA processes should address relevant government standards, requirements, enforcement and ESIA processes • The ESIA process should begin as early as possible in the project lifecycle • Stakeholder engagement is key to ensuring that the ESIA process is fair and credible

22. Integrating Biodiversity into Management Systems Environmental and Social Impact Assessment Stages of an ESIA relevant to biodiversity • Identification of alternatives • Screening • Scoping • Baseline establishment • Evaluation (impact analysis) • Development of mitigation options and implementation • Monitoring and adaptation Stakeholder engagement on biodiversity issues and estimation of secondary and cumulative impacts should occur throughout all stages

23. Mitigating Impacts What are the potential negative impacts on biodiversity from oil and gas development, and what practices can companies adopt at their operational sites that will mitigate these impacts? • Primary vs. Secondary Impacts • Similar in ultimate effect on biodiversity • Different in cause, scope, scale, intensity and boundaries of responsibilities  Smithsonian Institution, Carlton Ward

24. Mitigating Impacts Primary impacts • Changes to biodiversity from project activities • Geographic area relatively near to the project • Become apparent within the lifetime of the project • Often immediate effects • Relatively easily predicted through ESIA • Can usually be minimized or avoided through technological solutions • e.g. land take, habitat loss and soil erosion Primary impacts generally result from operational decisions and the activities of project personnel

25. Mitigating Impacts Secondary impacts • Usually triggered by the operations • May reach outside project or even concession boundaries • May endure or begin after a project’s life cycle • May or may not be predicted by ESIA • May not be identified or realized until much later in the project cycle, or after decommissioning  Conservation International

26. Mitigating Impacts Secondary impacts • Tend to result from government decisions and the actions and practices of nearby communities or immigrants, in response to the presence of the project • Are the most controversial and difficult to manage, because of shared spheres of responsibility • May cause the most problems for the project and company • Are most difficult to predict and control • Nevertheless, a company may be responsible

27. Mitigating Impacts Factors that may lead to secondary impacts • Immigration and new settlements • Increased access to undeveloped areas • Introduction of non-native species Source:Sader,S.A .,et al.Time-series tropical forest change detection for The Maya Biosphere Reserve: Updated Estimates for 1995 to 1997. Maine Image Analysis Laboratory,University of Maine,Department of Forest Management

28. Mitigating Impacts Approaches for managing secondary impacts • Cooperation among many partners • Early and continuous involvement with all relevant stakeholders • Government involvement and responsibility • Transparency and responsiveness to concerns • Promotion of and participation in government-led land-use planning processes at an appropriate geographic scale  Smithsonian Institution, Carlton Ward

29. Deciding Where to Work How can companies factor biodiversity criteria into decisions about where they will work? • With a risk-based decision-support framework for aiding in site selection, companies can: • Identify and prioritize the risks and benefits of working in a certain area and guide choices about whether to pursue specific business opportunities • Highlight requirements for specific risk-management responses • Help determine how to address biodiversity issues

30. Deciding Where to Work Key Aspects of the Framework Categorizing the world Rest of the World Conservation Priority Areas (CPAs) Protected Areas (PAs) Areas not yet identified as important for biodiversity conservation

31. Deciding Where to Work Protected areas and conservation priority areas • High biodiversity values exist both in and outside of protected areas • While some governments may permit oil and gas development in certain protected areas, this can present significant risks to biodiversity • Companies should seek to avoid protected areas by considering alternate locations, routes and technologies  Smithsonian Institution, Carlton Ward

34. Measuring Impacts and Actions on Biodiversity Biodiversity indicators • A formalized system to measure and monitor impacts to biodiversity can aid in predicting, minimizing and preventing impacts and increase transparency about company performance • Biodiversity indicators can be used to: • Understand impacts on biodiversity • Predict potential impacts • Improve operational performance • Minimize future impacts • Report back to stakeholders  Smithsonian Institution, Carlton Ward

35. Measuring Impacts and Actions on Biodiversity Biodiversity indicators • Indicators can measure and monitor impacts on species, habitats and ecosystems, as well as management commitment and process, impact reduction and positive action • Biodiversity has no single all-purpose indicator; rather a common methodology can be used to develop indicators for each project • Biodiversity indicators will not be necessary for every project or activity • Indicators are not an end in themselves, but an input into an adaptive management system

36. 1. Desktop Assessment 2. Establishing a Baseline 3. Focusing on Significant Impacts 6. Generating Company-Level Indicators 5. Choosing Site-Level Indicators 4. Generating List of Potential Site-Level Indicators 7. Monitoring of Impacts 8. Reporting Performance 9. Reviewing and Modifying Activity Measuring Impacts and Actions on Biodiversity Developing biodiversity indicators

37. Measuring Impacts and Actions on Biodiversity Examples of biodiversity indicators • Species:Globally threatened and data deficient species in area; restricted-range species; invasive non-native species that are threatening to ecosystems, habitats or species; species used by local populations • Habitat:Operational site overlap with conservation priority areas containing globally threatened or restricted-range species; amount of land within the operational site that has a management plan with a biodiversity conservation focus; contribution to habitat conservation • Corporate management:Biodiversity elements included in management system; corporate/business unit budget allocation for biodiversity; sites with biodiversity action plans; ongoing biodiversity conservation projects, at site or collaborations at company level

38. Benefiting Biodiversity How can companies go beyond minimizing impacts and take actions that benefit biodiversity? • By investing in opportunities to benefit biodiversity that go beyond just mitigating impacts and contribute to improving the status of biodiversity or the capacity to conserve it  Shell

39. Benefiting Biodiversity Opportunities vs. Offsets • Opportunities complement, rather than replace voluntary or required investments in conservation offsets • Offsets are designed to reduce primary and secondary negative impacts to achieve no net loss of biodiversity • Ensure that the status of biodiversity at the end of a project is comparatively as well off overall as before the project began • Should be minimum expected standard • Examples: Placing land into protected status, enhancing or restoring degraded land, supporting research or capacity-building

40. Benefiting Biodiversity

41. Benefiting Biodiversity

42. The Importance of Stakeholder Engagement • Stakeholders are all those who are affected, interested in or have the capacity to influence a project. • Engagement should begin as early as possible and continue throughout the project. • Helps a company earn a “social license to operate.” Source:Connor Development Services Ltd

43. The Importance of Stakeholder Engagement Biodiversity-related issues for stakeholder engagement • Local knowledge and use of biodiversity • Local dependence on ecological resources • Health impacts of environmental damage • Consequences of secondary impacts  Conservation International