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) also provides details of where the ERS has been made available to the locally affected community. The SPI must be sent to World Bank 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 and social 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 site visits to all operations and appraising technical and environmental/social information submitted by the project sponsor. The following potential environment, health and safety and social impacts of the projects were analyzed: - Corporate Environmental and Social Management Systems (ESMS) and structure; - Three production locations - Trinidad, Jamaica, and Barbados: - Sustainable quarry operations and rehabilitation/quarry closure plans as appropriate; - Plant operation standards for air emissions, wastewater/stormwater management, noise control; - Health and safety standard; - Energy efficiency impact of the proposed project; and - Workforce/social implications.

The sponsor has presented plans to address these impacts to ensure that the proposed project will upon implementation of the specific agreed measures, comply with the environmental and social requirements - the host country laws and regulations and the World Bank/IFC environment and social policies and the environmental, health and safety guidelines. The information about how these potential impacts will be addressed by the sponsor/project is summarized in the paragraphs that follow. - Corporate initiatives: Since TCL in Trinidad was completely privatized in 1998 (partly privatized in 1990 and 1994), and acquired controlling stakes in Arawak Cement Company Ltd. (ACCL) in Barbados in 1994, and in Caribbean Cement Company Ltd. (CCCL) in Jamaica in 1999 it has been continuously improving its corporate structure to develop into a modern responsible company. At the corporate headquarters in Trinidad the Group’s environmental and health and safety performance is monitored and advice is given to local operational personnel to ensure the Group is moving towards common improved standards. In this respect, all companies (TCL, ACCL, and CCCL) are in the process of implementing ISO 14001 Environmental Management Systems. The Group Environmental Engineer is frequently visiting all operations to ensure the continued progress of this work. Coordinated efforts to improve the quarry operations are also under implementation and will result in quarry management and rehabilitation plans being prepared for all quarries by end of 2005. All the TCL operations have community support programs tailored to reach locally affected people. Typical activities supported under these programs are local utility (water) supply where otherwise not present, and educational support for children and/or adults. The TCL group also has a tradition of providing masonry-training programs. - TCL operations in Trinidad: The operations in Trinidad include a limestone quarry located in Mayo, in the central region of Trinidad, a ten kilometers pipeline for limestone slurry connecting the quarry and the cement plant, and the cement production plant located in Claxton Bay. Other raw materials like gypsum and iron ore are imported. The TCL quarry, which holds 90+ years of reserves, is located 10 kilometers inland next to the village of Mayo. The mixed limestone and shale deposits are located in hills, which are removed in the quarry operation. The first hill, which has served the plant for 50 years, is now nearly removed and a new hill will be opened for excavation shortly. All the limestone and shale are in soft deposits and can be mined by ripping with bulldozer and loading with front loaders. No explosives are used. At the facility the limestone is crushed and mixed to ensure acceptable composition for the process, then it is wet milled and finally transferred to the cement plant by a ten kilometers pipeline. By utilizing a pipeline, heavy transport through this remote rural area has been avoided. The pipeline has a well established right-of-way. Regular maintenance work is needed but otherwise the line does not have any substantial impacts. The line does not carry any hazardous materials. The plant currently has two cement kilns with a combined capacity of 740,000 tons clinker per year. Both lines are based on wet technology. Dust emission control at the older kiln is designed for 150 mg/Nm3 (i.e. 150 milligrams per normal cubic meters), while the newer kiln has an ESP designed for 50 mg dust/Nm3. Both kilns will be checked to ensure they comply with the design parameters, and TCL will provide plans for bringing the operation of the older kiln to 50 mg dust/Nm3 (or as a minimum below 100 mg dust/Nm3) within a reasonable time frame to be agreed with IFC unless a firm time table is established for the process conversion and elimination of this emission point. NOx emissions will be kept in compliance with the WB guideline limit of 600 mg/Nm3. Domestic wastewater at the cement plant is collected in septic systems, and the resulting sludge is handled by an approved contractor. Run off water from the plant areas are discharged to the sea after process area run off waters have passed a settling pond. The run off waters have in the past had problems with periodic raised levels of suspended particulates and pH. It is believed that both these compliance problems have been related to product spills at the plant and vacuum cleaning operations to improve housekeeping have been implemented. TCL will ensure that the effluents comply with the local draft legislation and the World Bank Group guidelines in the future. TCL has established and is implementing the ISO 14001 Environmental Management System. However, the certification date has now been re-scheduled to late 2005 due to the revision of the ISO 14001 Standard and the policy of certification/registration bodies regarding the use of the 2004 Standard for auditing. Health and safety standards at TCL operations are within industry standards. The TCL management has recently, based on changed legislation, included onsite contractors in safety performance calculations and this has resulted in an increased frequency of reported accidents. Initiatives are now taken to increase the contractors’ awareness of the importance of safe operations. - CCCL operations in Jamaica: The operations in Kingston, Jamaica include a limestone quarry located in the mountain above the cement plant, and gypsum and the shale quarries located nearby in a hilly area. The limestone quarry operation, located above the plant is ideal in respect of limiting visual impact. During 2004 core drillings were performed and by the end of 2005 a quarry usage plan, allowing for optimized mining and blending will be ready. This plan will also include a rehabilitation plan for the quarry. The gypsum and shale quarry areas are characterized by decades of “cherry picking” of best raw materials and a lack of rehabilitation planning under the previous ownerships. CCCL is now in the process of preparing future usage, rehabilitation and/or closure plans as appropriate. These plans will be ready by end of 2005, and will aim at optimizing usage to the highest possible extent, while mitigating the visual and environmental problems created in the past. Removal of non-functional mechanical equipment left behind in the past will also be done. The existing cement plant has two cement kilns with a combined capacity of 600,000 tons clinker per year. One kiln is based on wet technology with an energy consumption of 1,550 kcal/kg clinker. The other kiln is based on dry technology with pre-heater and has an energy consumption of around 1,050 kcal/kg clinker. The project includes the replacement of the old wet technology kiln with one new dry technology kiln with pre-calciner and a resulting energy consumption of 750 kcal/kg. The new kiln will be designed for one million tons clinker per year, and might, depending on the market situation also take over production for the older dry technology kiln, which does not have pre-calciner. The kiln replacement will ensure full compliance with the World Bank Group guidelines for cement production and a reduction in the CO2 emission (related to the existing 600,000 tpa clinker production) of up to an equivalent of 115,000 tons CO2 per year if both the old kilns are phased out. CCCL has problems in keeping within the wastewater standard for total suspended solids. The problem is related to the use of an old wet slurry mill, associated with the wet kiln, and the problem will be completely eliminated as part of the project where the dry kiln will be introduced and the wet kiln will be retired. CCCL has established and is implementing the ISO 14001 Environmental Management System. However, the certification date has now been re-scheduled to late 2005 due to the revision of the ISO 14001 Standard and the policy of certification/registration bodies regarding the use of the 2004 Standard for auditing. Health and safety standards at the CCCL plant have continuously improved over the last years and accident frequencies are down by 41% from year 2000 to year 2003. There is though room for improvement and CCCL is pursuing these opportunities to ensure industry sector averages for accident frequencies are achieved. No changes in total number of employees are foreseen as a result of the project. - ACCL operations in Barbados: The operations in St. Lucy, Barbados include a limestone quarry located next to the cement plant, and a shale quarry located nearby in a hilly area. The limestone quarry goes below ground level and has a vegetated berm established around the periphery. The current quarry will be exhausted within the next two years and a concession in an adjacent formation has been applied for. The land for this concession will be acquired in a willing buyer/seller transaction if the local authorities approve the proposed quarry operations. ACCL will prepare a full quarry usage and rehabilitation plan before opening the new quarry, and will evaluate the opportunities of using off-spec materials from the new quarry preparation to create vegetated slopes at the edges of the current quarry. The shale quarry area is characterized by a lack of rehabilitation planning and ACCL will prepare a future usage and rehabilitation plan. This plan will be ready by the end of 2005 and will optimize usage while mitigating the visual and environmental impacts. The existing cement plant has one kiln with a capacity of 300,000 tons clinker per year. The process is based on dry technology with pre-heater and has an energy consumption of around 1,050 kcal/kg clinker. An overhaul of the emission control system to ensure compliance with the design criteria of 100 mg dust/Nm3 will be required, but no other changes to this facility are included in the project. The World Bank Group guidelines accept 100 mg dust/Nm3 for continued operation of existing facilities. NOx emissions will comply with the guideline value of 600 mg/Nm3. The ACCL facility has all domestic sewage collected in a septic system. Industrial wastewater from the on-site power station is diverted to an oil-water separator and the oily sludge is removed offsite. Environmental monitoring of plant industrial and storm water run-off was conducted in November 2004, and based on results, a program of routine wastewater monitoring will be implemented. The health and safety standards at the ACCL plant have improved significantly since the takeover by TCL, but there is still a need for improvement before the sector average for accident frequency is achieved. The plant management is aware of this problem and has plans for addressing this issue.

This ERS contains the full environmental and social documentation prepared for public disclosure on the project.

Accordingly, IFC concludes that the proposed project will meet the applicable World Bank/IFC environment and social policies and the environmental, health and safety guidelines upon successful implementation of the agreed mitigation measures. With the Group-wide implementation of the ISO 14001 Environmental Management Systems, all the member companies will have a structured approach to managing their environmental impacts, monitoring their environmental performance and improving on it.

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 and social activities. Periodic site supervision visits will also be conducted. Environmental monitoring programs in line with the TCL Group requirements are being implemented in TCL, CCCL, and ACCL. These programs require the routine monitoring at specified frequencies and plant locations of: ambient air quality, stack emissions, wastewater quality and sound levels. Monitoring of the performance and maintenance of key air pollution control equipment (e.g. bagfilters) is conducted at all three plants.