10803 - ICME ECAB

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Environmental Review Summary

Project Number

10803

Company Name

ICME ECAB SA

Date ERS Disclosed

May 14, 2001

Country

Romania

Region

Europe

Environmental Category

B - Limited

Status

Completed

Previous Events

Approved : Jun 27, 2001
Signed : Oct 24, 2001
Invested : Jan 24, 2002

Sector

Other (Copper, Rolled Copper, Brass, etc.)

Industry

other

Department

Regional Industry MAS LAC & EUR

Project Description

The project entails to revamp a cable manufacturing plant, ICME ECAB S.A. (ICME or the project), located in Bucharest, Romania, and to transform it into a cost efficient facility producing a wide range of high quality cables, conductors, and wires. The project will be implemented by Hellenic Cables S.A. one of the leading cable and conductor manufacturers in Greece with more than 50 years industry experience. Hellenic Cables is a part of Viohalco Hellenic Copper and Aluminium Company S.A. (Viohalco), a holding company of one of the largest industrial groups in Greece. As part of the project, Hellenic Cables will refurbish the plant, improve production methods, and facilitate the transition to higher value-added products. After the completion of the investment program, ICME ECAB will have: i) the ability to produce a wide range of high value-added products; ii) the required flexibility to adapt to changing local and international markets; and iii) the capacity to meet expected demand growth from new infrastructure projects in Romania and neighboring countries. In addition to benefiting from Hellenic Cables'' know how, ICME will gain from becoming a member of a dynamic industrial group, Viohalco, and from achieving greater economies of scale through Viohalco’s centrally managed functions such as: transportation, insurance, marketing, legal, and IT. The project is an important strategic investment for Viohalco who is seeking to increase its international competitiveness through reducing costs, improving quality and margins, and switching to higher end products.

Environmental and Social

The sponsor has presented plans to address these impacts to ensure that the proposed project will, upon implementation of the specific measures agreed, comply with applicable host country laws and regulations and World Bank/IFC requirements. A full Environmental Action Plan (EAP), satisfactory to IFC, with additional details on implementation of the proposed EAP, including detailed costs and schedules for implementation of the actions necessary to achieve the requisite performance improvements will be required prior to signing of the Investment Agreement with IFC. The information about how these potential impacts will be addressed by the sponsor/project is summarized in the paragraphs that follow.

1. The facility was previously developed by ICME S.A. The plant was constructed in 1949 and operated as a state-owned company until 1997 and is located in an industrial area on the eastern side of Bucharest. It was then privatized, and an Austrian company managed the site until April 1999 when it decided to split the facility into two separate companies. In August 1999 Hellenic Cables acquired ICME ECAB, the cable company. The renewed operation will remain in the existing site boundaries and will not result in the loss of sensitive habitats or archaeological sites. The site covers an area of 27.6 hectares, of which 42% is covered by buildings. Four main production halls exist namely energy cables, telephone cables, wire and conductors and rubber insulated cables. The northern part of the site, mainly an unused storage area will be turned into a commercial building for small businesses. An environmental audit was carried out by a Romanian consultant in August 1999. It found the ICME ECAB in compliance with Romanian regulations, and the recommendations included enhancement of monitoring and environmental management activities. Previously the Austrian investor had a full environmental due diligence carried out at the time they acquired ICME.

2. Electricity will come from the grid (Electrica), with a 110 KV transformer located on site. There is a natural gas line serving the facility. Potable water for cooking, washing and drinking is pumped from seven wells (boreholes), with potable water being treated by filtration and chlorination. Industrial process and cooling water comes from Lake Cernica, a reservoir used for the water supply of Bucharest. During the summer the quantity and quality of the water supply is uncertain therefore ICME will build a recycling circuit. Sanitary waste water and process waste water are discharged in the sewerage system, and then treated at the Grina Waste Water Treatment Plant (WWTP). Monitoring of industrial effluent is done every month. The existing run-off/drainage system of the facility will be upgraded to avoid any discharge of contaminated water in the local environment.

3. Steam, mainly used for heating purposes and production of rubber cables is currently produced by two outdated boilers using natural gas burners. The system is not efficient as it uses an old pipe network for distribution. Five new and decentralized steam generators will be installed by mid 2001 to replace the old ones, fired by natural gas with light fuel as back up energy. The existing central compressor station will be replaced by local compressors in order to have sufficient air pressure for new machineries. Therefore, particulate matter, NOX and SO2 emissions are anticipated to be low. Estimated emissions based on measurement results of similar equipment will meet World Bank group guidelines for atmospheric emissions. A new ventilation system will be installed in order to reduce work place emissions to an acceptable level. New bag filters were installed in 1996 to reduce dust generation at the rubber cable department. Air emissions are monitored regularly each month.

4. The plant will implement a comprehensive management program allowing operators to control and monitor non-hazardous and hazardous solid waste in accordance with local requirements and World Bank Group guidelines. No wastes are allowed to be disposed of onsite, and available historical information indicates that there have been no landfills on the site. Domestic solid waste (320 tons/year of domestic refuse) will be disposed off to the local landfill operated by the municipality company under local permit. Hazardous wastes are currently stored in a concrete bund on site and will be ultimately sent to a special landfill operated by the local authorities. Used mineral oils and lubricants will be used in the production of rubber cables. Various scrap materials such as out of specification cables (755 tons/year) will be sold for recycling.

5. Since no excessive noise will be generated at the vicinity of the facility, no noise abatement measures will be required. The proposed environmental action plan will include a PCB and an asbestos survey.

6. Land contamination from past activities at the plant site has been investigated. ICME has indicated that there have been no major incidents or accidents regarding hazardous substances. If past operations are found to have spills of oils or other contaminants from various sources, including plant processes, out of service transformers (oil filled equipment does not contain PCBs), vehicles and tanks, ICME ECAB has agreed to implement, during the initial plant modernization, remediation of oil contaminated soil identified, installation of preventative measures such as curbing, oil/water separators and spill containment.

7. In order to prevent and extinguish fires, the company has a contract with the Military Fire Brigade of Bucharest. On a permanent basis, there is a fire fighting vehicle, as well as one certified fireman. A central fire control room monitors closely fire safety, and adequate fire protection systems include portable fire extinguishers, an adequate number of fire hydrants placed throughout the plant and metal hose boxes that will be available in and around specified places. The portable fire extinguishers will be located nearby certain locations, such as fuel tanks. Company personnel are regularly trained in fire prevention and in use of fire extinguishers. Training will be provided to a specific group of employees on fire risks, fire fighting systems and response actions. An emergency response plan will be prepared.

8. Regarding occupational health and safety issues the following prevention and mitigation measures will be taken for workplace air quality, noise and other issues. All workers will be provided with personal protective equipment. Indoor dust will be prevented by means of adequate ventilation systems coupled with dedusting equipment. The maximum indoor dust concentration will be maintained at 2 mg/m3. Respirators will be supplied to the personnel during maintenance and repair work. Indoor noise levels will be periodically measured throughout the plant and ears plugs and/or muffs will be provided accordingly. In addition, sound isolated rooms will be installed in the required places, such as the compressor unit. In the high temperature areas personnel will work for short duration and cooling air will be provided. Appropriate safety measures will be applied for electrical systems and mechanical equipment, thus reducing risks for workers. A doctor is on site two hours every other day and a certified nurse (medical assistant) is present every even day. Stringent local regulations will be enforced including periodic health examinations by on site medical personnel. Additional training on occupational safety issues will be given. An overall housekeeping management plan will be prepared, including specific actions to improve occupational safety and workplace air quality.

9. ICME ECAB has an environmental management organization. A senior engineer is in charge of environmental issues and another senior staff oversees health and safety issues. These specialists will prepare long term and short term environmental protection plans, to be approved by ICME management and by the appropriate inspection bodies. A quality engineer is managing the company’s quality assurance systems. Additional adequate E, H & S procedures will be implemented as the plant gets modernized. Current regulator authorizations and operations permits are valid until May 2002. The technical group of Hellenic Cable/Viohalco will provide technical assistance and consultant support to ICME on an as needed basis.

Conclusion & Monitoring

IFC will evaluate the project''s compliance with the applicable environmental and social requirements during the lifetime of the project by reviewing the annual monitoring reports (AMRs) prepared for the project covering: (i) the status of implementation of any measures contained in the Environmental Action Plan and (ii) ongoing performance of project-specific environmental, health and safety activities as reflected in the results of periodic and quantitative sampling and measuring programs. Periodic site supervision visits will also be conducted.

This Environmental Review Summary (ERS) is prepared and distributed in advance of the IFC Board of Directors' consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board of Director’s decision. Any documentation that is attached to this ERS has been prepared by the project sponsor or in conjunction with the project sponsor and authorization has been given for public release. IFC has reviewed this documentation and considers that it is of adequate quality to be released to the public but does not endorse the content. The following ERS is disclosed in accordance with IFC's Disclosure of Information Policy that went into effect September 1998.

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

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