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 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. - Environment, health, and safety (EHS) management; - General conditions of storage terminals; - General conditions of service stations; - Water sources and liquid effluents; - Air emissions, workplace monitoring, and ambient air quality; - Hazardous materials, and solid/hazardous wastes; Fire prevention, occupational health and safety, and emergency response (ER) plans; - Community relationship and community development; - Land acquisition for new gasoline stations.

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 of 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. - There are management positions for environmental, health and safety (EHS) issues at each storage terminal and subsidiary operations group. The individual terminal or subsidiary group is responsible for its own EHS matters. There is one corporate manager working as the coordinator for overall EHS issues. - GNG’s logistics facilities consist of railroad terminal, road tanker fleet, unloading pumps and pipes, tank farms for oil storage, loading pumps and pipes for road tankers, and associated laboratory for quality control. The general condition of the storage terminals, built in the Soviet Union times, is acceptable. However, some renovations and improvements need to be done to ensure the sustainable operations of the terminals, and to meet best industrial practices. GNG has agreed to the following improvements during the proposed loan period: - Install sufficient lights in the terminals for emergency usage and possible operations at night; - Renovate the secondary containment walls and clear out the vegetation in the tank farms; - Increase the maintenance of pumps to reduce oil leaks (some old pumps may need to be replaced); - Improve the general housekeeping in each terminal; and - Increase the maintenance frequency for old road tankers. - The GNG service stations are managed and maintained fairly well. The operations of OKKO brand stations meet industry best practices. All new OKKO stations have underground storage tanks with double steel walls and inert gas between the walls. Before purchasing existing stations, the Company’s engineering team investigates both the station and neighborhood to make sure there is no liability for leakage of products. For minor leakage, the Company fixes the leaks before putting the station into operation. For serious leaks, GNG digs out the old underground tanks and replace them with the new double-walled tanks. GNG also plans to replace all the old underground tanks in five years. - Water at the terminals and stations are sourced either from municipal supply or onsite wells. The sanitary wastewater generated at these locations is either discharged directly to the municipal sewers, or primarily treated onsite in the septic tank before discharge. The contaminated oily storm water at the terminals is treated onsite by separators and then discharged to the municipal sewers. Similar type of storm water at the service stations is treated via filtration before being discharged. The liquid effluents meet the local regulatory requirements as well as World Bank Group (WBG)/IFC guideline limits, with the exception of the 5-day biological oxygen demand (BOD5) and total suspended solid (TSS) at some terminals and stations. The car washing wastewater is treated through filtration onsite and recycled for car washing. The used filters are disposed by government approved companies. - There is no manufacturing process in GNG’s operations which generate air emissions. The winter heating system at the service stations is electric heating, while the heating at the terminals is from gas-burning boilers. Since there are no floating roofs and gas recovery system at the terminals, there is fuel emission during the loading processes in the tank farms. The work place fuel emission levels are monitored internally twice a year, and are monitored by external consultants every five years. The work place monitoring data shows that the fuel emission levels at various locations inside the terminals are below both the maximum level allowed by local regulatory requirement and the permissible exposure limit (PEL) of US Occupational Safety and Health Administration (OSHA). There is no ambient air monitoring program in GNG. GNG will start monitoring ambient air quality after the proposed Project is implemented. - There are internal operation procedures for each position dealing with gasoline and other hazardous materials. GNG conducts internal inspections regularly for the handling of hazardous materials. The Company has internal policies and procedures for handling solid and hazardous wastes. Municipal contractors collect the solid wastes generated from the terminals and service stations periodically. Local government owned companies collect various hazardous wastes from GNG’s sites and transports them back to the companies for treatment, recycle and disposal. - There is a fire truck with high pressure water pump available 24 hours a day at each storage terminal. There is fire fighting equipment, including fire extinguishers, at the service stations. GNG will ensure that the firefighting equipment is checked and maintained routinely. There is an internal fire safety training once a year for all GNG employees. GNG also has fire drills once a month at its storage terminals. GNG has passed all the government fire prevention inspections. - GNG has its internal health/safety policy and emergency response plan. There are health/safety procedures for each operation position. All employees, including contractors, are required to pass the health/safety training before starting work. The employees are also required to take annual health/safety refresher courses. There is a physical examination for all new employees, and there is an annual physical check for all field employees. However, some employees do not follow the health/safety procedures strictly. It is suggested that the GNG managers should be more vigilant in enforcing the internal health/safety procedures. - GNG has a good relationship with the communities near its service stations because the stations generally attract additional business for the communities. GNG also hires disabled people, which account for 4% of GNG’s labor force as mandated by Ukrainian laws. The Company has an internal program to support orphanages nationwide by raising donations for the orphanages at its service stations, and then matching five times the donations. - For land acquisition for new service stations, GNG in most cases only purchase abandoned industrial land from local governments. In case of land purchases from individuals, the Company negotiates directly with the owners. GNG commits that future land acquisition will follow related WBG/IFC policies. - The Company accepted a Corrective Action Plan (CAP) as an attachment of this Environmental Review Summary (ERS), which consists of separate action plans and reflects the requirements of this ERS. The Company will implement the CAP during the project preparation and execution, and ensure the requirements of this ERS are satisfied according to its schedules.

The attached supporting document provides further details of environmental and/or social issues.

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.

IFC will evaluate the project's compliance with the applicable environmental and social requirements during the lifetime of the project through the following methods: - Review of the annual monitoring reports (AMRs) prepared for the Project. - The status of implementation of any measures contained in the Corrective Action Plan (CAP); - Ongoing performance of project-specific environmental, health and safety activities; - Periodic site supervision visits will also be conducted, if necessary. - Completion auditing for its environmental, health/safety, and social issues.