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Home › Dodgy Deals ›
Dodgy Deal
Portucel pulp millMozambique

Project – On record

This profile is no longer actively maintained, with the information now possibly out of date
Profile by:
BankTrack, ADECRU & Friends of the Earth Mozambique
Contact:

nature@banktrack.org

Last update: 2021-05-10 00:00:00
This 40,000 ha of eucalyptus is a small portion of the 356,000 ha to which Portucel has the land rights for 50 years. Photo: Steve Slater via Flickr (CC BY-SA 2.0)

Project – On record

This profile is no longer actively maintained, with the information now possibly out of date
Profile by:
BankTrack, ADECRU & Friends of the Earth Mozambique
Contact:

nature@banktrack.org

Last update: 2021-05-10 00:00:00
Why this profile?

What must happen

Investors should not support this project until Portucel has developed satisfactory measures to protect forests and biodiversity, to assure the integrity of water table and hydrological conditions, to implement Free Prior and Informed Consent (FPIC) and fully respect customary land rights, address social conflicts, implement full transparency and pursue stakeholder engagement.

About
Sectors Pulp, Paper and Paperboard Mills
Location
Status
Planning
Design
Agreement
Construction
Operation
Closure
Decommission
Website http://en.portucelmocambique.com/Portucel-Mocambique

Portucel Moçambique is a Mozambican company, controlled by The Navigator Company (previously known as Portucel Soporcel). The company plans to build a pulp mill in Ile-Namarroi, in Zambézia, Mozambique. The project also includes a biomass power generation plant and is expected to be operational by 2023. The pulp mill will have a production capacity of 1,500,000 tonnes of pulp per year, which will almost double The Navigator Company's global pulp production capacity. The project requires an investment of USD 3 billion.

The pulp will be sourced from eucalyptus plantations in the Zambezia and Manica provinces. The plantations will be located in forested regions, where deforestation is occurring at a rapid pace, as shown in maps published by Global Forest Watch. The loss of forests is also leading to climate change. In the case of Mozambique, 53.1% of GHG-emissions in 2011 came from land-use change and forestry.

Impacts

Social and human rights impacts

Some of the social impacts related to plantations have been identified in the Environmental Impact Assessment report released by Impacto. The main issues raised by communities were as follows:
  • Land that is critical for food security and traditional life has been taken from local communities. (The Oakland Institute).
  • Consultation meetings between the company and the local communities have not been held in traditional language. As a result the majority of the people was unable to understand most of the meetings. In different cases, possible impacts have not been properly outlined. In some cases, temporary jobs were promised in exchange for land, in others land has been acquired without compensation. Some people have been relocated to fields far away from roads and basic services, such as medical care. Other people have had to rent land at their own expense
  • In this environment, already marked by water stress, the expansion of eucalyptus plantations will inevitably affect the surrounding areas bringing a severe decline to local agriculture, and threatening food security
  • The Environmental Impact Assessment report for the Zambezia forestry project states that "communities reported elevated concern with regard to their perception of lack of land for the project implementation, occupation of lands without consent and due compensation, lack of clarity in relation to the project and the lack of transparent communication mechanisms between the company and the communities." It identifies the following socio-economic impacts: conflicts in the process of access to land, loss of agricultural areas, risk of malnourishment and malnutrition and loss of ecosystem services for communities. It also lists mitigation measures
  • A local chief has forbidden community leaders to voice their concerns regarding the project, while pressure to accept the project has been reported. In some cases, temporary jobs have been promised in exchange of land, in other land has been acquired without compensation. People have been relocated to other fields far away from roads and basic services such as medical care. Others had to rent land at their own expense (Justica Ambiental).

The description of impacts on this page is sourced from the report A Land Grab for Pulp. For more information about these impacts read this report here.

 

The consultations held with local communities did not comply with international standard of FPIC (Free Prior and Informed Consent) as laid down in the UN Declaration of Indigenous Rights. Community members told Justiça Ámbiental that only one meeting was held, at which none of them had been informed about the project, and in which potential social and environmental impacts of the project were not discussed. In other cases, communities confirmed that there had been a meeting with the company, but the majority (80%) reported that they did not understand most of the meeting, because of the language used.

Portucel should adopt a specific policy on security. Any security company that is contracted should not be implicated in past abuses. Human rights education and a strict non-violence policies should be part of core trainings. For expressions of concerns a grievance mechanism should be in place, about the security arrangements and for reporting any abuses in a confidential way, so as to ensure the security of affected people.


Environmental and climate impacts

The plantation is expected to have adverse impacts such as pollution, soil erosion, loss of biodiversity, increased risks of forest fires, modification of the aesthetic value of the landscape. It will further impact remaining forest ecosystems of miombo woodlands, and possibly fragments of afromontane and eastern African coastal forests. Both the pulp mill and plantations will be located close to the Deforestation Fronts as outlined by WWF. Landscapes will not be protected and natural forests will be converted including 114,000 ha of densely wooded 'sensitive areas' (only 10% of the area will be set-aside, mostly located in areas unsuitable for plantations). Furthermore, the conversion into plantations will displace traditional forest uses, creating more pressure on the remaining fragments of natural forests.

Roads, forest tracks and fire breaks, that come along with the project, will also impact the natural forests. To establish the Zambezia plantations, 1,200 km of forest tracks will be opened, as well as 280 km of perimeter firebreaks of 6 meters in width.

Financiers

The first phase of the project (plantation development) is expected to be funded by equity only, 80% from the Navigator Company and 20% from the International Finance Corporation of the World Bank. Costs for this phase amount to USD 160 million, or 5.3% of the total project costs.

Institution type
Finance type
Year
Companies

Navigator Company

Portugal
Profile
Website

Portucel Moçambique

Mozambique
Website
No companies
Governance
Norms & standards
Other regulations

Applicable norms and standards

IFC Performance Standard 1: Assessment and Management of Environmental and Social Risks and Impacts
IFC Performance Standard 2: Labor and Working Conditions
IFC Performance Standard 3: Resource Efficiency and Pollution Prevention
IFC Performance Standard 4: Community Health, Safety, and Security
IFC Performance Standard 5: Land Acquisition and Involuntary Resettlement
IFC Performance Standard 6: Biodiversity Conservation and Sustainable Management of Living Natural Resources
IFC Performance Standard 8: Cultural Heritage

The IFC has defined the project as a Category A Project, "due to the potentially significant, diverse, and irreversible environmental and social risks and/or impacts inherent to a project of this nature and scale operating in Mozambique". Therefore, the IFC Performance Standards 1-6 and 8 apply to this project. The Guidelines for Observation and Exclusion from the Norwegian Government Pension Fund should apply.

News
BankTrack
Partners
Blog
External
BankTrack news BankTrack blog Partner news Partner blog

Activists protest first eucalyptus shipment from Mozambique to Portugal and ask World Bank to stop funding ‘afforestation’/operating company

2021-07-14 | Portugal, Mozambique | EPN
BankTrack news BankTrack blog Partner news Partner blog

The capture of policy-making by the pulp and paper industry is driving mega-fires in Portugal and land grabbing in Mozambique

2021-05-10 | Environmental Paper Network
BankTrack news BankTrack blog Partner news Partner blog

Navigator Takes Pulp Mill Project In Mozambique Back On Track

2018-07-12 | Mozambique
BankTrack news BankTrack blog Partner news Partner blog

Portucel Moçambique plants 13,000 hectares of eucalyptus

2017-12-07 | Macauhub
BankTrack news BankTrack blog Partner news Partner blog

Produção de celulose ameaça o centro de Moçambique

Portuguese only
2017-11-27 | Deutsche Welle
BankTrack news BankTrack blog Partner news Partner blog

Portucel to build US$3B pulp mill in Mozambique

2017-11-21 | Further Africa
BankTrack news BankTrack blog Partner news Partner blog

Mozambico: land grabbing per la carta

Italian only
2017-11-20 | Agoravox.it
BankTrack news BankTrack blog Partner news Partner blog

A Land Grab for Pulp – a report on Portucel Mozambique

2017-11-17 | EPN
BankTrack news BankTrack blog Partner news Partner blog

Portugal’s Portucel increases investment in pulp project in Mozambique

2016-01-25 | Macauhub.com
BankTrack news BankTrack blog Partner news Partner blog

US abstains from IFC investment in Mozambique paper plantation

2015-03-31 | Bretton Woods Project
BankTrack news BankTrack blog Partner news Partner blog

Portucel Moçambique assina acordos com instituição do Banco Mundial para

Portuguese only
2015-03-19 | Jornal de Negócios
Resources
Documents
Videos
Links
2014-06-30 00:00:00

Non-technical summary of EIA report for the Zambezia Forest Project

(unofficial English translation)
Other document
2014-06-30 00:00:00 | Impacto
2016-06-30 00:00:00

Amendment to EISA summary

Other bank document
2016-06-30 00:00:00 | IFC
2011-12-31 00:00:00

Understanding land investment deals in Africa: Mozambique

NGO document
2011-12-31 00:00:00 | The Oakland Institute
2016-10-31 00:00:00

Industrial Tree Plantations Invading Eastern and Southern Africa

Briefing compiled by the World Rainforest Movement (WRM) and the Timberwatch Coalition (TW)
NGO document
2016-10-31 00:00:00 | World Rainforest Movement, Timberwatch Coalition
2017-11-20 00:00:00

A land grab for pulp

New mill project by Portucel Mozambique
NGO document
2017-11-20 00:00:00 | EPN, ADECRU, Quercus, ARA, KKM
2016-07-01 00:00:00

Plantações Florestais da Portucel ameaçam a segurança alimentar nas comunidades do distrito de Namaroi, na Zambézia

Portuguese only
NGO document
2016-07-01 00:00:00 | ADECRU
2015-09-21 00:00:00

Portucel - O Processo de acesso à Terra e os direitos das comunidades locais

Portuguese only
NGO document
2015-09-21 00:00:00 | Justiça Ámbiental
2015-01-01 00:00:00

Procedimento de Acesso a Terra

Portuguese only
Company document
2015-01-01 00:00:00 | Portucel Mocambique - Grupo Portucel Soporcel
2015-01-01 00:00:00

Consultas Públicas sobre o projecto envolveram mais de 15.000 pessoas

Portuguese only
Company document
2015-01-01 00:00:00 | Portucel Mocambique - Grupo Portucel Soporcel
2014-09-29 00:00:00

Environmental & Social Review Summary

Other bank document
2014-09-29 00:00:00 | IFC
2014-09-01 00:00:00

Relatório do estudo impacto ambiental da província da Zambézia, Maputo

Portuguese only
Company document
2014-09-01 00:00:00 | Impacto; Portucel Mocambique
2014-06-01 00:00:00

Environmental Impact Assessment Report

ZambeziaForestryProject
Company document
2014-06-01 00:00:00 | Impacto, Portucel Moçambique
1997-10-01 00:00:00

Ley da Terras

Other document
1997-10-01 00:00:00 | National legislation

Risk alert: A Land Grab for Pulp in Mozambique

2018-05-28 13:56:49

Ejatlas- Portucel Moçambique

EPN webpage on Portucel Mozambique

EPN webpage on pulp finance

KKM - Coordinating Committee Mozambique - Germany

Quercus

ADECRU

ARA-Working Group on Rainforests and Biodiversity

Petition - Mozambique: stop a giant pulp project in the miombo woodlands!

A land grab for pulp in Mozambique

Video by Environmental Paper Network Jan 2018

Business & Human Rights Resource Centre - The Navigator Company

FSC Watch

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