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Approved : Oct 9, 2002 Signed : Jan 6, 2003 Invested : Apr 1, 2003
Sector
Wood Panels and Engineered Wood Products
Industry
other
Department
Regional Industry MAS LAC & EUR
Project Description
The proposed investment program consists of: (i) the refinancing of existing debt (ii) minor maintenance investments in its current production facilities; (iii) investment for environmental upgrades; and (v) further investment in plantations.
Environmental and Social
IFC requires that this document is made available through the World Bank InfoShop and to the locally affected community no less than 30 days prior to project consideration by the IFC Board of Directors.
The Summary of Project Information (SPI) provides details of where the ERS has been made available to the locally affected community. The SPI must be sent to InfoShop no less than 30 days prior to project consideration by the IFC Board of Directors.
This is a Category B project, according to IFC’s Procedure for Environmental and Social Review of Projects because a limited number of specific environmental impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. The review of this project consisted of appraising technical and environmental information submitted by the project sponsor. The following potential environmental, health and safety impacts of the project were analyzed:
· Plantation management (including retention of natural habitats and pest control), impacts (including water table changes) and sustainable harvesting issues; · Production issues relating to third party supplies of wood; · Air emissions; · Water use and waste water management; · Hazardous materials use and solid waste management and disposal; · Fire protection and emergency response; · Occupational health and safety; · Job creation, retrenchment and labor issues; · Opportunities for environmental certification of wood products.
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. The information about how these potential impacts will be addressed by the sponsor/project is summarized in the paragraphs that follow and in Table 1 below.
Plantation management, impacts and sustainable harvesting issues. All wood used by the company is derived from managed plantations of pine and eucalyptus (Pinus caribaea, P. oocarpa, P. kesiya and Eucalyptus grandis & E. urophylla) and there is no harvesting from natural forest or use of hardwood veneers in any of the company''s product lines. At the Taquari site approximately 90% of wood supply is obtained from plantations that are owned and managed by third parties. The remaining 10% is derived from the company’s plantations. At Uberaba, a minimum of 85% of wood supply will be supplied from company plantations. The remainder will sourced from residual material from local sawmills.
Within the company''s plantations, all site preparation, planting, silvicultural treatment and harvesting is conducted by 3rd party contractors under the overall supervision of Satipel. The use of agrochemicals on the company''s plantations is controlled and only a limited range of industry standard chemicals is used (Table 2). Over the history of the plantations there has been negligible loss of trees from disease or fire and acceptable buffers of natural vegetation have been left between plantations and watercourses to protect water quality. Areas not suitable for timber such as wet low-lying land have been left in their natural state. As part of the activities involved in the preparation to obtain Forest Stewardship Council (FSC) Certification, the sponsor will develop a monitoring system to ensure that any changes in water table or hydrology are detected and mitigated.
Production issues relating to third party supplies of wood. Over the past 30 years, the sponsor has sourced wood from a large number of small independent landholders. Initially, extension support was provided to third party suppliers, however over the course of time, suppliers developed skills and expertise in timber production and the company does not now need to assist producers with technical support. Third parties are subject to Brazilian legislation (Ley Portaria #48/95 & # 114/95)which requires that a management plan is prepared for all plantations and all harvested land must be replanted. As part of Satipel’s management system, they conduct monitoring to ensure that their third parties are in full conformance with the local requirements. In addition, Satipel will ensure that their third party wood suppliers do not contravene the WB policies and will, as needed, encourage them to implement Satipel’s good environment, health and safety practices.
Air emissions. The Uberaba site has three boilers (solid wood and/or sander dust fired) for wood processing that discharge through an air pollution controlled single stack. This site also has emissions to the atmosphere from the process areas including screening, grading, glue mixing, sanding, silo storage, etc. These release points are also controlled with air pollution control devices. The sponsor has monitored all boiler and process emissions and demonstrate compliance with the World Bank guidelines (WBG) requirements, with the exception of the dryer emissions from the new line at the Uberaba site which will need to be tested to assess compliance with the WBG. The results of this stack testing along with any needed control measures and implementation time schedule will be submitted to IFC prior the first disbursement. If needed, the dryer air emission controls will be installed within two years after the first disbursement, but not later than December 2003.
The Taquari site has four boilers also fired with solid wood and/or sander dust. The sponsor will conduct stack monitoring testing for the boilers as well as the process air emission points and submit the results along with the needed control measures to ensure compliance with the applicable WBG and implementation timeframe prior to first disbursement. If needed, the air emission controls will be installed within two years after the first disbursement but not later than December 2003.
Water use and waste water management. There will be limited water use at both Uberaba (an estimated 10 m3/h) and Taquari ( approximately 100 m3/h) sites and supplies will be drawn from municipal sources. Water conservation measures will be put in place (education of employees, re-cycling of chip washing waters) anticipating a water use reduction of approximately 50 percent by the end of 2002 at the Taquari site. Water reduction measures will be also implemented at the Uberaba site.
Wastewater from the Uberaba site is currently pretreated according to Brazilian regulations (COPAM-MG regulation no. 010) prior to discharge into the municipal sewer. However since the municipal sewer system has no wastewater treatment works, Satipel is installing an onsite wastewater treatment facility which will be operating by June 2003. This will be designed and operated to comply with WBG effluent requirements. The Taquari site treats its liquid effluents at its onsite wastewater treatment plant prior releasing them at the Taquari River. The treated effluents comply with the applicable WBG.
Hazardous material use and solid waste management and disposal. A limited range of hazardous materials is currently used at the Uberaba and Taquari sites (i.e., fuel oils, glues and resins.) Fuel, glue and resin are stored in tanks with secondary containment in secure areas at both sites. Use of all these chemicals is carefully controlled.
Solid wastes include wood, wood dust, papers, boiler ash, used lubricating oils, resins and sewage sludges (Table 3). Waste separation and selective disposal programs have been established for some time at both sites.
Fire protection and emergency response. There is a comprehensive fire control system at the Uberaba old line. The Uberaba new line has in addition automatic spark detection/extinction systems, smoke detection systems in electric switch boards and metal separation resources to prevent spark/fire hazard in the rotating equipment. The Taquari site also has fire/explosion protection systems comprised of underground fire piping plus hydrants, portable extinguishers, sprinklers in localized areas. Training in fire control and emergency evacuation is also undertaken at both plants.
Occupational health and safety. The company has taken a proactive stance in relation to occupational health and safety issues. On the company’s plantations, Brazilian Safety Standard (NRR1-) is followed regarding worker protective equipment. Harvesting is completely mechanized and the equipment used is designed to protect the operator in this type of working environment.
The production facilities are generally well maintained. The workplace ambient air concentrations for formaldehyde and wood dust at the old line and the new particleboard at the Uberaba plant are in compliance with the applicable WBG. As part of the continuous improvement of their operations, Satipel will further improve the ventilation conditions at the work areas and will continue with their research to use formaldehyde scavengers to reduce further the concentrations in the working environment. The formaldehyde concentrations at the Taquari site are also compliant. The workplace dust levels will be monitored and result sent to IFC before the first disbursement. If needed, controls measures, implementations timeframe and associated costs will be also included. The expected control measured will be implemented within one year after the first disbursement. Employees working in processing areas with high noise levels are provided with appropriate personal protective equipment. Additional measures such as sound-insulated control rooms/operation cabins have been implemented at both sites.
Satipel sub-contracts all transportation activities and requires in its contracts with the transportation companies specific safety requirements. Satipel is developing the Emergency Response Plan for both sites and anticipates to have it completed by December 2002. Satipel will submit a copy of the plan satisfactory to IFC once completed. The company has a proactive program of training (all new employees receive safety procedure training, annual safety seminars and other periodic formal training programs). There is a health and safety department and an accident prevention team which includes representatives from employees and management.
Community Related Activities.As part of its operations, Satipel also conduct activities in the communities nearby including providing elementary school for its employees and the kids in the neighborhood and computer training to its employees and their families. In addition, Satipel will initiate a furniture manufacturing course in partnership with local furniture manufacturers having Satipel employees as instructors. This program is gear toward teenagers leaving in nearby communities as well. Satipel also proves assistance/donations to social programs in the areas of influence.
Environmental management and opportunities for environmental certification of wood products. The company has a full-time designated engineer with responsibilities for all safety and environmental issues at each site, including, planning and management of solid and liquid wastes and air emissions; obtaining licenses and negotiating with statutory environmental agencies; environmental education of company employees and the local community; environmental input to process technology decision making; and optimization of operations relating to the reduction and recycling of residues.
Satipel is in the process of applying for Forest Stewardship Council Certification for its plantations and aims to achieve this by December 2003.
Table 1 CORRECTIVE ACTION PLAN
Specific Corrective Actions to be Implemented
Site
Action
Implementation Schedule
Uberaba
Dryer stack emissions (new line) and corrective measures if needed
Boiler and process stack emissions and corrective measures if needed
Prior to first disbursement
Workplace dust concentrations and corrective measures if needed
Prior to first disbursement
Emergency Response Plan
December 2002
Table 2 Agrochemical Use in company Owned Plantations
Chemical
Frequency
Purpose
Planting
Glyfosate - Herbicide
1X
Weed Control
Sulfuramide
As req’d
Ant Control
Phosphate
1X
Soil Balance
NPK 05:30:10 Fertilizer
1X
Fertilizer
Maintenance
Glyfosate - Herbicide
1X first year
Weed Control
1X second year
Sulfuramide
1X/year
Ant Control
Table 3 Solid Waste
Solid Waste Type
Disposal Method
Sander Dust
Used to fire boilers & dryers
Paper, Laminate Waste
Shreaded & incorporated in the Core Layers of product
Boiler Ash
Used as fertilizer in plantations
Plastic, Paper, Metals, etc
Sold to 3rd Party Recyclers
Used Oil
Stored in drums and collected by external waste management company
Resin and Glue Residuals
Disposed of to co-processing
Sewage sludge
Disposed of to agreed landfill
Conclusion & Monitoring
Accordingly, IFC concludes that the proposed project will meet the applicable World Bank/IFC environmental and social policies and the environmental, health and safety guidelines upon successful implementation of the agreed mitigation measures.
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 ongoing performance of project-specific environmental, health and safety activities including but not limited to:
· Ambient, workplace and stack air emissions; · Waste water quality; · Agrochemical use in the plantations; · Employees health and safety.
Progress in the implementation of the CAP will also be monitored and periodic site supervision visits will also be conducted.
Press-Release
Related SPI
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