INTERNATIONAL CONSULTANT (TEAM LEADER) - COST BENEFIT ANALYSIS OF THE MINING SECTOR OF MONGOLIA
|Application Deadline :||30-May-12|
|Type of Contract :||Individual Contract|
|Post Level :||International Consultant|
|Languages Required :||
|Starting Date :|
(date when the selected candidate is expected to start)
|Duration of Initial Contract :||26 days|
|Expected Duration of Assignment :||26 days|
Mining is expected to bring many economic benefits to Mongolia, but also costs. Discussion around the impacts of mining in Mongolia is currently not based on scientific studies that measure the environmental and social impact of mining activities. No cost analysis has been carried out for the mining sector in Mongolia and there is an urgent need to carry out this type of research to help develop evidence-based policies.
UNDP is supporting the Ministry of Nature, Environment and Tourism (MNET) to assess the full costs and benefits of mining in Mongolia. The study aims to fill gaps in data on the costs and benefits of environmental, social and economic impacts of the mining sector and to build the capacity of Ministry staff to measure those affects, both now and in the future to aid in the decision making process for mining sector policy.
The results of the study will help inform policy makers, civil society, mining companies and donors about the true costs and benefits of mining operations. Economic, social and environmental factors will be clearly identified and valued to assist in better understanding the impacts of mining on social welfare (family disorganization, prostitution, migration etc.) and ecosystem services in Mongolia.
The assignment is part of the Strengthening Environmental Governance in Mongolia Phase II Project (EG Phase II; M?N/11/301), which is being executed by MNET in accordance with the UNDP guidelines for nationally executed projects. The assignment team is working under the guidance of the EG Phase II Project Implementation Unit (PIU) and will be supported by UNDP Mongolia's economic advisor. The team is working closely with the Department of Natural Resource Management of MNET.
The study will develop a specific methodology for Mongolia to measure economic, social and environmental impacts of mining in monetary terms. Based on the methodology, spreadsheet models will be built for analysis of mining operations in Mongolia at both the individual mine and sectoral levels. A manual will be developed to explain the methodology and to enable replication of the results and updating of the models.
The following results and activities have already been completed by during the first phase of the project:
- 2 mining sites have been selected as pilots for obtaining cost and benefit related data for the individual mine level model.
- Background research on the current situation of the mining sector in Mongolia, including the laws and regulations that apply , has been conducted.
- The types of benefits and costs arising from mining in Mongolia have been identified.
- An initial model for cost benefit analysis of individual mine sites was developed using Microsoft Excel.
- Economic benefit calculation spreadsheets have been prepared by the Economic expert to generate data for the CBA model. The calculations have been done at the local, regional and state levels (the calculation of economic cost is currently ongoing).
- Research into the Dutch Disease effect is currently in progress.
- Calculations of external environmental costs (damage from land degradation, ground and surface water depletion and pollution, soil degradation and pollution, subsoil damage, flora and fauna damage, forest damage, air pollution, etc) based on MNET guidelines have been conducted for input into the CBA model. Validation of the data is expected to be completed soon.
- Environmental costs that have been internalized by mining operators such as water fees, land fees, air pollution fees, waste management costs, rehabilitation costs, and environmental protection costs have been calculated for incorporating into the CBA model.
- Terms of reference for a field study to estimation the cost of lost grazing land using contingent valuation methods has been developed.
- A mining cost model for a comparative approach of cost estimation is incorporated into the CBA model
- Mining operation parameters are linked with environmental impact parameters of the CBA model
- Costs and revenues for open pit mining have been estimated for input into the CBA model.
- Work to value the health impacts of mining is ongoing.
- The Terms of Reference for a field study on divorce rates due to mining has been developed.
- An approach for calculating compensation for the resettling of herders’ winter camps has been developed and will be tested in pilot areas.
The PIU is expecting the final version of the model to consider the following:
- ecological impacts from existing and planned mines;
- direct and indirect costs and benefits from environmental degradation, such as loss of grazing pasture, water supply and/or quality, impacts on tourism; and
- direct and indirect costs and benefits from social impacts, such as prostitution, migration, erosion of local culture.
Objectives of the Study
The study will estimate the economic, environmental and social costs and benefits of mining in Mongolia. It will do this through the development of two spreadsheet models – one estimating the costs and benefits of an individual mine and another for the mining sector as a whole. Both models will be based on international best practice in cost benefit analysis and social and environmental valuation techniques. The models will be simple enough to be used by Ministry staff yet provide insights useful for evidence based policy development.
The model of individual mines will be used by staff at the MNET to determine the net benefit to society of approving proposed mines. The model will include the ability to adjust particular policy settings to determine the optimal conditions for the mine development. During the study, the model will be used to assess the costs and benefits of two mines chosen as case studies.
The sector level model on the other hand will seek to demonstrate the overall benefits and costs of the mining sector in Mongolia. The model will also allow for some analysis of adjustments to policies. The study will develop a rigorous and innovative methodology to measure, model and value the change in ecosystem services and social welfare from mining development, including flow on impacts to local communities, agriculture and tourism. It will also consider ecological issues such as ecosystem thresholds and irreversibility.
The consultants, both international and national, undertaking the study will provide a manual and conduct a training session for relevant Ministry staff to enable ongoing use of the models. An expert workshop will also be held to brief policy makers, the private sector and civil society about the results of the study and the true costs and benefits of mining development in Mongolia.
Duties and Responsibilities
Approach to the study
The study should include the following components:
- Identification of potential mining concessions (location and size) and assessment of the potential impacts of these on the environment, economy and society.
- Development of a methodology for costs benefit analysis for a period of 20 years, including the costs of ecosystem degradation and impacts on society from mining.
- Quantification in monetary terms of social and environmental impacts arising from individual mines and the mining sector overall.
- This should include costs already incurred from existing mines as well as projected impacts from mining over the next 20 years.
- The difference in costs imposed from harmful and sustainable practices by individual mines will also be identified.
- Sensitivity analysis on key assumptions including long term mineral commodity prices and the discount rate.
- Development of a manual explaining the methodology and concepts behind the models and how to use, interpret and update the models.
- A training session to provide guidance on the use and interpretation of the models for Ministry staff.
- Modeling of business as usual and alternative policy scenarios for mining operations to assess site and sector-wide costs and benefits.
- Analysis of the benefits of potential alternative policy settings at the site and sector-wide levels.
- Identification of cost effective remedial actions that could be undertaken at the national or site level to enhance ecosystem functioning alongside mining developments.
- A policy workshop to promote incorporation of results into sustainable mining development plans.
(to be completed by the international consultant with assistance from the team of national consultants):
1. Desk review – inputs from each team members, including inception report completed in the first phase of the study. The inception report includes a summary of previous work in related fields, an overview of the relevant legal framework for internalizing costs from mining, a gap analysis to determine outstanding data requirements and CBA model on Excel).
2. Finalize the methodology for determining the current and projected (for 20 years) environmental and social costs and benefits, resulting from the mining sector and individual mines. This will include:
- Linking mining parameters to environmental, social, and economic impacts in the models.
- Identifying costs associated with specific mining activities that demonstrate the difference between harmful and sustainable practices at mine sites.
- Conducting sensitivity analysis on long term commodity prices, the discount rate and other any appropriate parameters.
- Applying appropriate valuation techniques (both, cost and benefit side) to the estimated environmental impacts of mining. This should include use and non-use values of the environment.
- Estimating the monetary value of the social impacts of mining using international best practice.
3. Assist in analyzing surveys to generate information for use in the cost benefit analysis.The surveys will cover:
- estimation of the loss of grazing land at two selected mine sites; and
- divorce rates at two pilot mining sites and Ulaanbaatar.
4. Draft a manual on the methodologies used for developing the models (including valuation techniques employed). The manual should also provide guidelines on using, interpreting and updating the excel sheet model
5. Conduct a training course on how to use, interpret and update the models. The course will include direction on how to generate new scenarios, revise calculations, and conduct sensitivity analysis.
6. Identify cost effective remedial actions that could be undertaken at the national policy, planning and site levels to enhance ecosystem functioning alongside mining developments.
7. Model business as usual and alternative (sustainable) policy scenarios for mining operations at the site and sector levels. Analyze the benefits of potential sustainable alternative policy settings.
8. Prepare a draft final report which describes the tasks and results of all stages of the study. This should include, but is not limited to:
- a summary of previous work conducted in related fields;
- a mapping of potential mining concessions (location and size) and an assessment of potential impacts of these on the environment, economy and society;
- an overview of the relevant legal framework;
- a description of the data availability to assess the costs and benefits of mining in Mongolia and the results of gap analysis (availability and reliability of data);
- a detailed description of the results of the pilot, site level cost benefit assessments conducted on two sample mines;
- any proposed further changes to the individual mine methodology used based on the results of the pilot assessments;
- detail on the methodologies used to assess the costs and benefits of economic, environmental and social impacts of mining in Mongolia. This should include the valuation techniques used and identify any areas in which expert judgment was relied upon due to a lack of alternative information.
- recommendations for policies to internalize costs of mining;
- an assessment of the marginal benefits possible from a shift from harmful to sustainable mining practices at individual mines;
- a description of the methodologies used to develop the sector level model of mining costs and benefits;
- a summary of the costs and benefits that the mining sector generates in Mongolia; and
- an analysis of the potential benefits of sustainable alternative policy settings compared to a business as usual scenario for the mining sector.
9. Prepare and facilitate a one day expert workshop to present the results of the study.
10. Prepare and submit an electronic copy of the cost benefit models, developed in a format that allows for easy testing of key assumptions and parameters (to be in Microsoft Excel format).
11. Submit the final report to the project implementation unit incorporating comments received on the draft report. Comments will be received from peer reviewers, from stakeholders at the workshop and from the Ministry. The report will describe assessment methods, activities undertaken, findings and recommendations and should meet the purpose of the work as set out above.
The Final Report must fulfill the following criteria:
- Include a complete overview of all the activities implemented during the project
- Include all prepared project documents
- Include a description of all outputs completed and results achieved
- Include a summary of outputs and the identification of any major problems which may have arisen during the performance of the contract
- Include records of assumptions used in the analysis
- Be analytically and technically robust
- Include user friendly discussion where appropriate to summarize in-depth analytical and/or technical work
- Be comprehensive and well written
As part of the ‘Strengthening Environmental Governance in Mongolia' Project Phase II, the activities will be overseen by the National Project Manager from MNET and a Project Implementation Unit.
The international consultant will work as a team leader with the following national consultants:
- Economist – National Team Coordinator (national expert);
- Environmental specialist (national expert);
- Mining Expert (national expert); and
- Sociologist (national expert).
The Team Leader will be responsible for managing the team and for ensuring satisfactory and timely completion of assignment deliverables. The team leader will also play an important capacity building role and will work closely with national team members as appropriate throughout the assignment to develop their capacity in relation to the assignment objectives.
All documents, relevant to the assignment, prepared and reviewed by national consultants will be submitted to the international consultant.
Deliverables and timeframe
- The expected duration of consultancy is 26 days with a start date of June 11, 2012 with mission to Mongolia for 24 days. The proposed schedule of activities for the international consultant is outlined in Table 1.
- Two spreadsheet models for cost benefit analysis; one for the mining sector and another for individual mines.
- A manual on using, interpreting and updating the models, including a description of the methodology used in the model.
- A training course on how to use, interpret and update the models.
- A final report, which incorporates an assessment of the costs and benefits of mining sector and individual mines, and which identifies social and environmental impacts of mining in Mongolia.
Table 1. Tentative schedule of activities and timeframe
During mission to Mongolia
Finalization of CBA model development
CBA manual and training course development, training of national team member for use of the model
Drafting a final report
11 – 12 June, 2012
13 June – 22 June, 2012
23 June – 01 July, 2012
02 July, 2012
03 - 04 July, 2012
Finalization of the report
07 – 08 July, 2012
- Demonstrated strong technical knowledge
- Ability to structure a task in terms of the analytic/investigative process and to produce a well-structured output
- Ability to work in a team
- Ability to deliver on time
- In-depth practical knowledge of the inter linkages between the social, economic, environmental and cultural dimensions of sustainable development;
- Openness to change and ability to receive / integrate feedback
- Excellent writing skills.
Required Skills and Experience
Required skills and general experience:
- Masters degree in economics, environmental economics, or related field etc. PhD is an asset. Experience in modelling economic costs of development impacts as monetizing of social and environmental costs
- Experience in similar projects/programs
- Experience in managing and coordinating small teams, preferably in an international/multi-national context
- at least 10 years of professional experience
- Fluency in English
- Computer literacy
- Experience of work on projects supported by the UNDP, World Bank, or other similar international agencies will be an asset
Specific professional experience:
- Experience in conducting CBA analysis of mining industries, especially estimation of social and environmental costs of mining
- Hands on experience in conducting economic analysis of mining, experience in developing model, employing the use of the Net Present Value (NPV) and Benefit-Cost Ratio (BCR).
- Experience in data analysis and report writing
- Good presentation skills
- Cumulative analysis will be used in the evaluation of applications, and details of the evaluation criteria/weight/points as provided below:
- Experts will be evaluated against a combination of technical and financial criteria. The maximum obtainable score is 100, out of which the total score for technical criteria is 70 and for financial criteria is 30.
- For the technical evaluation, the following aspects will be considered:
- Background and education – 20 % or 14 points
- Practical previous experience relevant to the announced TOR – 50 % or 35 points
- Substantial knowledge and professional experience in cost benefit analysis, and competencies - 30 % or 21 points
Requirements for proposals
Interested service providers should submit a technical proposal with a financial proposal (lump sum), addressing the scope of work and the above requirements and outputs.
Proposed work plan and approach, and deliverables the technical proposal should reflect how the Consultant will undertake all of the above-mentioned activities
CV of the applicant
- CV of the consultant, details of the service provider, including the consultant’s profile outlining relevant skills, experience and track record.
- Reference letters from at least two current or recent clients.
A lump sum is payable upon the satisfactory completion, and approval by UNDP, of all deliverables. The financial proposal should include the full mission costs (travel and DSA, covering the anticipated itinerary) into his/her financial proposal. UNDP will cover travel costs not exceeding those of an economy class ticket. Should the IC wish to travel on a higher class, he/she should do so using their own resources.
Submission of proposals
Proposals from suitably qualified and experienced candidates must be submitted via email no later than May 30, 2012
UNDP is committed to achieving workforce diversity in terms of gender, nationality and culture. Individuals from minority groups, indigenous groups and persons with disabilities are equally encouraged to apply. All applications will be treated with the strictest confidence.