Appeal to the President of the World Bank in regards to the Oil Spill in the Strait of Kerch

Mr. Robert Zoellick
President
The World Bank
1800 H Street, NW
Washington, DC 20433

November 19, 2007

Dear Mr. Zoellick:

We are writing to you with regard to the devastating oil spill that occurred on November 11 in the Strait of Kerch, between the Black Sea and the Sea of Azov. A tanker was split in two during a severe storm, dumping over two thousand tons of fuel oil into the Strait. Three cargo ships that were carrying sulfur also went down in the storm and at least seven thousand tons of sulfur spilled into the sea. The result was destruction up and down the coast of the Taman Peninsula as beaches and wildlife alike were oiled by the spill. Already, over thirty thousand birds have died, along with untold numbers of fish and other sea life. The protected territories of the Taman-Zaporozhskaya Wildlife Preserve and the Important Bird Area “Taman”, both of which are adjacent to the Strait of Kerch, were severely damaged. According to the latest information, the severity of the spill has not yet been fully understood and chunks of fuel oil continue to wash up on beaches further and further from the site of the initial accident.

The main reason for the catastrophe is that the transport of dangerous cargo occurred in a region with a tremendously valuable and fragile environment, in very difficult conditions for shipping and in the absence of necessary technical safety measures.

Unfortunately, these incidents are connected to the activity of the World Bank in this region.

As you are aware, the International Finance Corporation provided financing for the construction of the Russkiy Mir Oil Terminal on the Taman Peninsula. The “daughter” company Tamanneftegas is responsible for its construction. The operator of the company “Russkiy Mir” is the Dutch Company, Malmros Continental Company, BV. This project was categorized as a “B” project by the IFC, which we believe was a serious mistake on its part. The terminal is located not far from the region where the accident took place, and in many ways the problems at this terminal are similar to the problems that caused the catastrophe in the Strait of Kerch. The Russkiy Mir terminal also located in a place that is extremely valuable and fragile from an environmental perspective. There are also difficulties for shipping and as the latest incidents at the terminal demonstrate, the technical side of the system of safety assurances has flaws.

We have learned that there were several incidents at and around the Tamanneftegas terminal on November 11. These events demonstrate clearly the serious environmental dangers of this project. At the time of the natural disaster, Russkiy Mir II was severely impacted as three ladders on the sea platforms were damaged. And if the terminal had been active, there could have been a rupture in the undersea pipelines of fuel oil and liquefied gas, the impact of which would have been serious environmental degradation. In addition, according to information from local resident Yuri Baluev, on that day, one of the tankers was blown very close to the Tamanneftegas terminal, creating a serious threat of its destruction. A third incident occurred at the site of the neighboring Toliattiazot sea platform where a pontoon crane was torn off, which could also have damaged the Tamanneftegas sea platform.

Each of these incidents causes us to be even more critical of Tamanneftegas’s project; and these incidents must also lead to increased responsibility on the part of the World Bank for the Russkiy Mir II project. If there were an accident leading to catastrophic consequences and the terminal were operational, the responsibility for this would lie with the World Bank as the institution that made construction of the terminal possible.

You may remember talking with Mr. Igor Golubenkov, co-director of the NGO Saving Taman!, during the Annual Meetings of the World Bank—he spoke with you immediately following the Town Hall Meeting, which was organized at the IMF. When he spoke with you, Mr. Golubenkov was concerned that the Taman Peninsula would be at great risk if oil and gas transportation and storage were increased in the region —specifically, he spoke to you about the Russkiy Mir II project and the desire of local citizens to see Taman develop as a recreational and tourism destination, not risk environmental degradation from oil and gas transport. Tragically, Mr. Golubenkov’s worst fears have been realized and the Taman Peninsula has been irrevocably damaged by the oil spill.

In light of these events, we believe that the IFC should reconsider its investment on Taman and increase its demands on the company Tamanneftegas to ensure its environmental safety in the construction of the terminal. As the events of November 11 demonstrate, this safety has not been guaranteed thus far. Each of the three incidents that occurred that day at the Tamanneftegas terminal could have caused an environmental catastrophe if the terminal had been working.

We also demand that the Bank acknowledge the mistake it has made in classifying the Russkiy Mir Project as a category “B” project and implement all the resultant organizational conditions.

We request that the IFC refrain from any additional financing of oil and gas related projects on the Taman Peninsula and formally confirm the decision not to finance environmentally dangerous projects in this region.

We also believe it would be appropriate for the IFC to encourage Tamanneftegas to provide financial support to the recovery efforts on the Taman Peninsula and the Strait of Kerch in response to the recent spill to demonstrate its commitment to sustainability for the community and the environment of the region.

We have attached the English language version of the petition Mr. Golubenkov handed to you in October requesting that the IFC refrain from financing oil and gas related projects on Taman. We have also attached the latest information from the region about the potential damage at the Tamanneftegas terminal.

We hope to hear from you soon, and would be pleased to meet with you to discuss this issue in more depth.

Sincerely yours,

Kate Watters
Crude Accountability

Andrey Rudomakha
Environmental Watch on the North Caucasus

Igor Golubenkov
Saving Taman!
Deputy of the Taman Agricultural Settlement

Tatyana Bulgakova
Saving Taman!
Deputy of the Taman Agricultural Settlement

Ivan Prikhodko
Saving Taman!
Deputy of the Taman Agricultural Settlement

Bruce Jenkins
Bank Information Center

Enclosures: Press Release from EWNC and Saving Taman!
English Translation of Appeal from Russian NGOs from October 2007

Cc: Mr. Rashad Kaldany, Infrastructure Department, IFC
Mr. Roman Novozhilov, Department of Environment and Social Development, IFC
Meg Taylor, CAO