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 both plants and reviewing 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: existing and planned management systems for quality, environment and health and safety; occupational health and safety; food safety; air emissions from steam and heat generation; sustainability and quality of potable water supply used in food manufacturing; liquid waste management; biological control of pest species; and, solid waste management.

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. P.T. Prakarsa Alam Segar, Bekasi The Jakarta plant is located on an 11 ha site, formerly a textile factory, in an industrial area of Bekasi, and opened in December 2003. The plant currently has existing noodle lines and expects to add more in the next 8 months. Electricity is provided from the local grid, with small backup diesel gensets. Steam is used to heat oil for cooking, and is produced currently in 3 diesel-fired boilers of 10, 7 and 5 T/hr respectively. As part of the plant improvements, a 20 T/hr gas-fired boiler will be added, and all units will be converted to use gas as a fuel. Water supply is derived from the local utility as well as from wells on the site, and is properly treated and tested to ensure compliance with Indonesian and IFC standards. Sanitary wastes are currently treated in septic systems which are pumped out frequently. Process wastewater is currently de-greased and pumped to a storage pond on site for passive oxidation and infiltration to ground. This will be replaced by end 2004 by a primary and secondary wastewater treatment plant which will meet IFC guidelines. Solid wastes include largely waste plastics from packaging which are currently stockpiled on site but will be recycled for packaging. Other wastes such as paper and scrap metal are also recycled if possible, or sold to other users, with any remainder being sent to the Bekasi municipal landfill. Used cooking oil is reused, and also sold for refining. Fire safety needs further attention. Fire extinguishers are present in some locations, but more are needed, and a hydrant system is still being installed. IFC will require that a review of fire and life safety be carried out prior to disbursement, to identify further measures needed to ensure compliance with IFC requirements. PAS currently has over 1600 workers, largely from the local area. Training is provided to develop a corporate culture and ensure a safe working environment. Currently, new workers require a medical exam, and IFC has recommended that a regular system of medical checkups be required. Compensation and working hours follow Indonesian labor standards. The company will provide emergency medical care on site, and are also building a musholla and canteen, and will provide uniforms for regular use. Working conditions are generally adequate. Some packaging areas are quite noisy and PAS will monitor noise levels and ensure the use of proper PPE as needed. Other minor improvements in health and safety conditions are needed, such as better use of signage, attention to equipment guarding, bunding of acid and alkali tanks for water treatment, and better cleaning of floors in oil cooking areas. Better ventilation is needed in the noodle cooking area, and there may also be opportunities for improved energy efficiency in this area. This plant plans to get ISO 9001 quality certification, along with Good Management Practices (GMP) certification. IFC recommends the implementation of an integrated environmental and health and safety management system to complement these efforts, and will work with PKS to this end. P.T. Karunia Alam Segar, Gresik KAS occupies a portion of a larger industrial site of 75 ha located in north Gresik in a developing industrial area. The area was formerly occupied by brackishwater fish ponds which are now being filled as the city expands. The land was purchased from the previous owners on a willing seller-willing buyer basis, and no residents or land users were displaced. This plant started operation in early 2003. Power is provided locally, with a diesel-fueled genset for backup. There is one 20 T/hr gas-fired boiler for steam production for cooking. There is no visible air emission from this boiler. Drinking water supply is from deep wells, which is filtered, demineralized and tested. Process water is from the municipal system, and has been tested to ensure that it meets Indonesian standards. Process wastewater has been treated in a holding pond until now, but a primary and secondary treatment system has been built and is about to come into operation. The system includes both anaerobic and aerobic digestion, and can handle up to 40 m3 per day which is adequate for plant operations. Sanitary wastes are treated in septic systems. These systems will meet IFC guidelines. Fire safety is addressed through fire extinguishers and hydrants, but these will be subject to independent review to ensure that they meet Indonesian standards and good international practice. Diesel fuel tanks need secondary containment. KAS currently has approximately 1800 workers, and expects to expand. Compensation and working hours follow Indonesian labor standards. Working conditions are generally adequate, although there are some noisy areas which need to be monitored and where PPE is needed. The noodle cooking area needs better ventilation. Other minor housekeeping issues were identified throughout the plant, and a clear program to address these issues is needed and will be required as part of the plant expansion plans. KAS plans to obtain ISO 9001 certification. IFC recommends the implementation of an integrated environmental and health and safety management system to complement these efforts, and will work with KAS to this end.

The following supporting documents provide further details of environmental and/or social issues: Environmental Action Plan .

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