INTEGRATED SAFEGUARDS DATA SHEET CONCEPT STAGE Public Disclosure Copy Report No.: ISDSC842 Date ISDS Prepared/Updated: 09-Oct-2012 I. BASIC INFORMATION A. Basic Project Data Country: Armenia Project ID: P127759 Project Name: IRRIGATION SYSTEM ENHANCEMENT PROJECT (P127759) Task Team Giuseppe Fantozzi Leader: Estimated 26-Nov-2012 Estimated 26-Mar-2013 Appraisal Date: Board Date: Managing Unit: ECSAR Lending Specific Investment Loan Instrument: Sector: Irrigation and drainage (90%), General energy sector (10%) Theme: Water resource management (70%), Rural policies and institutions (20%), Rural services and infrastructure (10%) Financing (In USD Million) Financing Source Amount Borrower 4.40 International Bank for Reconstruction and Development 22.00 Public Disclosure Copy Local Farmer Organizations 0.50 Total 26.90 Environmental B - Partial Assessment Category: Is this a No Repeater project? B. Project Objectives The Project Development Objective (PDO) is (i) to reduce water losses and energy needs for operating selected schemes and (ii) to improve the capacity of Water Users Associations. C. Project Description The development objective would be sought through: (i) interventions to convert, where feasible, pump-based irrigation to gravity irrigation, and to upgrade the efficiency of pump-based irrigation where conversion would not be feasible; and (ii) interventions to upgrade WUA-level irrigation canals, outlet canals of pumping stations and to pilot drip irrigation. Limited additional activities will also aim at piloting bio-drainage in the Ararat valley and institutional measures and interventions to improving participation and governance in Water Users Associations (WUAs). The Project would consist of three components: Public Disclosure Copy Component 1: Improving the energy efficiency of selected parts of the irrigation system infrastructure (US$15.0 million): This will include: a) Conversion of pump-based irrigation to gravity (US$10.0 million): The rationale for this sub- component would be to lower the cost of water by converting pump-based irrigation to gravity irrigation. The Project would provide for the construction of two gravity systems (Meghri, Geghardalich). b) Upgrading of non-convertible pump-based irrigation systems (US$ 5.0 million): This sub- component would aim to lower the operating cost and improve the efficiency of irrigation systems in areas where pump-based irrigation is the only option and is proven to be economically justified. Interventions would include necessary mechanical improvements to about 15 pumping stations to ensure their uninterrupted operation and energy use efficiency, in parallel with the upgrading of about 35 km of outlet canals to minimize high value water losses. Component 2: Improving the conveyance efficiency of selected part of the irrigation system. (US$7.5 million): This will include: a) Upgrading of tertiary level canals (US$5.5 million). In order for the benefits of membership in WUAs to become more visible to farmers, this sub-component would provide funding, on a cost- sharing basis (most probably 15 percent), to upgrade irrigation infrastructure for which participating WUAs are responsible. This would cover about 10 km of secondary and 20 km of tertiary canals. It would be done through contractual arrangements. b) Upgrading of selected outlet canals for pumping stations (US$1.0 million). In parallel with the upgrading of pumping stations in component 1 (b) about 35 km of outlet canals to minimize losses of high value water will be needed. c) Pilot programs (US$1.0 million): This sub-component would support pilot activities to test, under actual farm conditions, the technical feasibility and economic desirability of: (i) drip irrigation (US Public Disclosure Copy $0.75 million): Volunteer farmers would be invited to participate in this pilot program on a cost- sharing basis (most probably 35 percent). The pilot would probably involve 5 sites in the command areas of 5 WUAs (Ararat, Vagharshapat, Armavir, Araks, Khoy) pre-selected on the basis of the intensity of cropping and the frequency of water shortage.; and (ii) bio-drainage (US$0.25 million): The aim would be to test the technical and cost effectiveness of bio-drainage as an environment- friendly approach to lowering the groundwater level and preventing soil mineralization. The pilot would cover about 500 ha, 20% of which would be planted in tree species suitable for the purpose at hand and offering potential economic value for the communities affected. The pilot program would be located in the Ararat Valley, along the Araks River, possibly in the Sis, Noramarg, Araksvan and Baghramyan communities. Component 3: Capacity building for WUAs and Project Management (US$4.4 million): This will include: 1. Capacity building for WUAs: The primary focus of this sub-component would be on making WUAs governed by and serving the interest of the totality of their members, including women. While past support to WUAs centered on their legal establishment and the creation of administration and operation capabilities, this Project would address mainly governance and participation issues. This will include setting up of a mechanism to generate gender disaggregated monitoring data. Operational training will also be included through refreshment courses of modules already developed in the past (procurement, financial management, irrigation techniques, O&M planning and fee setting, etc.) and the development of a new module on efficient on-farm use of water. Public Disclosure Copy 2. Project Management: This sub-component would provide for overall project management, coordination of the implementation process, preparation of preliminary design documents, coordination and monitoring of technical supervision of civil works, preparation of tender documents and management of the procurement process, monitoring project activities, and reporting on progress in project implementation. D. Project location and salient physical characteristics relevant to the safeguard analysis (if known) Bulk of the individual investments under the Irrigation System Enhancement Project (ISEP) will be concentrated in Ararat, Armavir, and Aragatzon provinces (marzes) of Armenia. Two schemes targeted for conversion from pumping to gravity system are located in Syunik marz (Meghri), and Kotayk marz (Geghardalich). E. Borrowers Institutional Capacity for Safeguard Policies The Project will be managed by the Water Sector Project Implementation Unit (PIU) operating under the State Committee for Water Management (SCWM), which has more than a decade of experience in implementing water projects, mainly those financed by the Bank. F. Environmental and Social Safeguards Specialists on the Team Darejan Kapanadze (ECSEN) Kosuke Anan (ECSSO) II. SAFEGUARD POLICIES THAT MIGHT APPLY Safeguard Policies Triggered? Explanation (Optional) Environmental Assessment OP/ Yes OP/BP Environmental Assessment is triggered Public Disclosure Copy BP 4.01 and Environmental Impact Assessment (EIA) of the proposed project activities is required. EIA for one specific investment to be financed from the project was carried out under the MCC program. Based on the experience from Irrigation Rehabilitation Emergency Project (IREP), this EIA report is expected to be suitable for the purposes of the proposed ISEP, provided that it gets updated and revised to satisfy all requirements of the Bank policy. The project proposes to improve irrigation efficiency and to lower costs by converting two existing deteriorated pump irrigation schemes (Gegardalich and Meghri schemes) to gravity fed schemes. This would imply moving some water intakes from their current locations to new ones. In case of Meghri scheme, multiple intakes from Araks River will be replaced by a single new intake from Meghri River, which is the tributary of Araks; and in case of Geghardalich, several pumping intakes drawing water from Azat reservoir will be substituted Public Disclosure Copy with water intake from Geghardalich reservoir. The latter exists at present, though needs increase of capacity through heightening of the dam. While the amount of water intake is not expected to change for the Araks scheme, the EIA shall investigate potential negative ecological impacts of the change in intake location. A full-scale EIA was carried out for the works proposed on Meghri scheme, though with recent changes in the design the EIA report needs an update. It is expected that EIA report for Meghri will be re-worked prior to the ISEP appraisal as part of the consultant assignment for the Meghri feasibility study and the detailed design under the on-going IREP AF. It is advisable that procurement arrangements for conducting EIA for Geghardalich scheme are made promptly to ensure timely delivery of the EIA report for the Bank approval and disclosure by the Project appraisal. Testing of bio-drainage technique is one of the proposed activities under the ISEP. It implies Public Disclosure Copy planting trees to pull out excess water from the soil and rendering it suitable for cultivation. The excess water is the result of water logging due to many years of irrigation in the area in the absence of functional drainage. It is not clear whether bio-drainage would be effective in this situation, as it would not address the problem of excess mineralization (salinity) of the soil which frequently arises in such cases. Therefore, this project idea will be further investigated during ISEP preparation, and a decision made as to whether to include the pilot activity. If found to be viable as a pilot activity, an Environmental Assessment will be carried out which will focus on the pilot area but also take into account potential impacts and mitigation requirements should the pilot be successful and thus trigger larger scale application of the approach in the area. Among the issues to be addressed is the need to avoid use of invasive non-native tree species. Natural Habitats OP/BP 4.04 No Public Disclosure Copy Forests OP/BP 4.36 No Pest Management OP 4.09 Yes OP 4.09 Pest Management is triggered, because some agricultural areas, which had been out of irrigation due to deteriorated infrastructure, will be brought back to irrigation as a result of IEEP and that would most likely imply increased use of pesticides. While there is no need of developing a Pest Management Plan, promotion of sound pesticide use practices will be included into the project design. Physical Cultural Resources OP/ No BP 4.11 Indigenous Peoples OP/BP 4.10 No Involuntary Resettlement OP/BP Yes OP/BP 4.12 Involuntary Resettlement is 4.12 triggered, because construction of new irrigation pipelines, as well as rehabilitation of the existing ones - to lesser extent - may cause a need for land take or temporary restriction of land use. No physical relocation or large scale land acquisition is likely, though, because rehabilitation of the existing schemes usually does not cause such impacts, and construction Public Disclosure Copy of the new sections of pipelines is planned along the right-of-way of the existing communications. Safety of Dams OP/BP 4.37 Yes OP/BP 4.37 Safety of Dams is triggered, because conversion of Gegardalich pumping scheme to gravity implies switching of water abstraction from Azat reservoir to the Gegardalich reservoir and expansion of the latter to be achieved by increasing the height of the existing dam from 13.9 m to 15.5 m. Projects on International Yes OP/BP 7.50 Projects on International Waterways OP/BP 7.50 Waterways if triggered, because conversion of Meghri scheme implies construction of a new water intake point from river Meghri - a tributary of an international river Araks. Once this new intake becomes operational, the existing several intakes from river Araks will be decommissioned. According to the available design documents, the volume of water abstraction from the new intake point on river Meghri will be the same as the total designed capacity of present abstraction points on river Public Disclosure Copy Araks. ISEP intervention is not designed to increase volume of water abstraction from river Araks, but will rather substitute several points of abstraction from Araks with one point of abstraction from a tributary of river Araks. Therefore, approval from the RVP will be sought in order to except the proposed activities from the riparian notification requirement under OP 7.50 para 7(a). Projects in Disputed Areas OP/BP No 7.60 III. SAFEGUARD PREPARATION PLAN A. Tentative target date for preparing the PAD Stage ISDS: 30-Oct-2012 B. Time frame for launching and completing the safeguard-related studies that may be needed. The specific studies and their timing1 should be specified in the PAD-stage ISDS: EIA reports, including EMPs, for larger scale construction works on Geghardalich and Meghri schemes, as well as site-specific EMPs for smaller scale interventions will be prepared and disclosed before appraisal. Detailed designs for drip irrigation and bio-drainage pilot sub-projects may not be known at that stage, in which case Environmental Management Framework for the pilot activities program will be developed and disclosed also prior to the appraisal. All site- specific environmental reports and management plans will be discussed with stakeholders and finalized before commencement of works at any specific site. The Resettlement Policy Framework (RPF) will be prepared and disclosed prior to appraisal, Public Disclosure Copy based on the existing RPF for the IREP. Site-specific Resettlement Action Plans (RAP) will be prepared in accordance with the RPF and disclosed before commencement of specific civil works as applicable. IV. APPROVALS Task Team Leader: Name: Giuseppe Fantozzi Approved By: Regional Safeguards Name: Agnes I. Kiss (RSA) Date: 09-Oct-2012 Coordinator: Sector Manager: Name: Dina Umali-Deininger (SM) Date: 21-Oct-2012 1 Reminder: The Bank's Disclosure Policy requires that safeguard-related documents be disclosed before appraisal (i) at the InfoShop and (ii) in country, at publicly accessible locations and in a form and language that are accessible to potentially affected persons.