OMK has presented plans to address the above mentioned impacts to ensure that the proposed project will, upon implementation of the specific measures agreed, comply with applicable standards. A brief summary of the environmental and social impacts is presented in the paragraphs below, including details of proposed mitigation measures, to address these potential impacts.
Environmental, Health and Safety Management System (EHS) on corporate level. During IFC appraisal, OMK has demonstrated a strong commitment to improve the environmental performance of all metallurgical plants. OMK recognizes the need for a more systematic approach at corporate level to planning, monitoring and improving for environmental, health and safety matters. At present, qualified specialists responsible for EHS issues at OMK’s plants works independently and do not have the benefit of exchanging experience. As a result, environmental practices are not consistently applied throughout the various operations. Nevertheless some of the shortcomings would only require simple and inexpensive remedial action. To address this issue, the company has recently hired corporate EHS staff to properly manage and evaluate environmental, health and safety risks of its operation. It will include establishing roles, responsibilities and providing appropriate resources as well as strengthening the process for internal/external communications on EHS issues.
Vyksa is located in Nizhegorodskaya Oblast, Vyksa town, 190 km away from Nizhniy Novgorod (regional capital). The facility, with its 14,632 employees, is the key employer in the city of Vyksa and plays an important role in local economic development. Vyksa is a producer of welded pipes and railway wheels. The plant includes a steelmaking shop with Open Heart Furnaces (OHF), four pipe mills, a wheel shop, and a foundry.
Environmental management system: Vyksa has a Quality Assurance System in accordance with ISO 9001. It is intending to develop an Environmental Management System (EMS) in line with ISO 14001. In order to implement a more systematic approach to improving the plant’s environmental performance, a separate Industrial Ecology Department has been created, employing 144 people.
Occupational Health and Safety (OHS):
Vyksa intends to develop and implement an OHS management system to achieve compliance with OHSAS 18001. As part of this, Vyksa will strengthen and implement sound H&S practices (i.e. provision and use of personal protective equipment, compliance with safety procedures, and others) as needed.
Air emissions:
Vyksa Steel Works is gradually implementing an improvement plan to control emissions to the atmosphere. A ladle furnace and a vacuum degasser equipped with a bag filter plant for control of emissions to atmosphere were installed in 2004. One cupola in the foundry has been converted to natural gas firing to reduce air emissions. Nevertheless, air emissions resulting from steelmaking and foundry are currently not meeting IFC guidelines. The information about how these impacts will be addressed by Vyksa are presented below:
Steelmaking:
Steelmaking facilities consisting of two OHFs are not equipped with emission control and do not meet IFC guidelines for air emissions (particulates and Nitrogen Oxides or “NOx”). The ESAP includes, as an interim step, electrostatic filters to capture particulate and potentially catalytic systems, or alternative feasible purifying technology for destruction of NOx. The purifying method will be determined on the basis of the study to be undertaken by the end of 2006. As a second step, Vyksa has committed under the ESAP to phase out its OHFs and replace them with an alternative technology to further improve its environmental performance and meet fully IFC requirements. Vyksa will complete the replacement of the OHF by 2012.
Foundry:
To improve the effectiveness of emission control, Vyksa intends to convert the second cupola to natural gas firing and equip the electric arc furnace with fume collection equipment by 2009.
Liquid effluent treatment:
Vyksa generates process wastewater, sanitary wastewater and storm water effluents. To reduce water consumption a water recirculation system is functioning to include water recirculation in six workshops. No modern facilities exist for treatment of process effluent apart from oil interceptors and a settlement lagoon, which also receives storm water run-off. The existing system will be reconstructed to higher standards after appropriate study including an “end-of-pipe” treatment facility before discharge to Zheleznitsa River. The effluent discharge does not comply with Russian regulations for suspended solids, iron and oil content, although concentration of suspended solids and oil are already below the IFC requirements. The lubricants used in the pipe expanders form a “jelly” which contaminates the water used in the subsequent washing operation. A chemical treatment process to remove these lubricants has been identified by the Company and is being installed.
Solid waste:
Vyksa operates its own landfill, divided into lined cells in accordance with modern practice. The landfill is located 20 km from the plant and also receives municipal waste from the city. Currently Vyksa is constructing a new landfill site which should comply with Russian environmental legislation. Vyksa will implement improvements to the areas for temporary storage of waste, which should reduce the potential for fugitive emissions to air and contamination of soil and water.
Gubakha is located in Perm Oblast about 260 km away from Perm. Gubakha is a producer of coke for steel making. Coal supplies are obtained form the Kuzbass and Pechora basins. The plant includes two coke batteries, one completely reconstructed in 2002 and the second one under reconstruction with operation expected to commence by March 2006.
Environmental management system: Gubakha will develop and implement an EMS in line with ISO 14001.
OHS: Gubakha has agreed to develop and implement OHS management system in compliance with OHSAS 18001.
Air emissions:
The audit findings indicated substantial non-compliance of Russian regulations for phenol and ammonia as well as marginal excess of emissions of carbon monoxide, oxides of nitrogen and soot. Ghubakha has developed and gradually implements the improvements plan to control emissions to atmosphere. The improvements under construction or planned will allow the sanitary zone around the plant to be reduced from 2 km to 1,5 km from the plant. An area of the town, which is now within the 2 km zone, will be outside the reduced 1,5 km zone.
NOx Ammonia collection tower is under construction. Removal of ammonia from the coke oven gas (COG) is expected to reduce emissions of nitrogen oxides from combustion sources.
Carbon monoxide Improved gas cleaning is a factor in increasing consumption of COG by the neighboring power plant. Delivery of more gas to the power plant or possible in-house use of gas for production of electricity will allow eliminating flaring and utilizing the additional gas supplies from the second battery.
Phenol The ammonia collection system will also have the effect of improving the biological treatment of liquid effluent. Currently aerobic process does not achieve effective destruction of phenol because of poisoning of the biological process by ammonia. This improvement will reduce emissions of phenol to air via the quench tower.
Fugitive dust emissions will be reduced by the improvements to coal handling and storage.
Liquid effluent treatment:
Gubakha generates process wastewater, sanitary wastewater and storm water effluents. To reduce the water consumption a water recirculation system is being implemented. Storm water is discharged into Kos’va River. At present the storm water discharge does not comply with Russian regulations for phenol, although its concentrations are already below the IFC requirements. The improved biological process and effective destruction of phenol will allow reducing emissions of phenol to air via the quench tower; and, therefore, its subsequent condensation, precipitation and introduction in the storm water.
Waste management:
Current practices do not meet IFC guidelines. Gubakha will develop and implement a detailed plan for handling disposal of all type of waste.
Chusovskoy is located in Perm Oblast, 217 km away from Perm. Chusovskoy is a producer of rolled section steel and long products including reinforcing bars and various special profiles. It also produces pig iron, ferrovanadium and bow springs.
Environmental management system:
Chusovskoy will develop and implement an EMS, initially to address priority issues such as air emissions control, handling and storage of hazardous substances and handling and disposal of wastes.
OHS: Chusovskoy intends to develop and implement OHS management system to achieve compliance with OHSAS 18001. As part of this, Chusovskoy will strengthen and implement sound H&S practices.
Air emissions:
At present, air emissions do not meet IFC guideline limits for particulates. Chusovskoy has presented IFC with a list of activities to control emissions to the atmosphere, comprising the following improvement projects:
Bessemer converters:
In the Duplex Shop emission control systems will be designed and constructed with a new bag house allowing to comply with IFC requirements.
OHFs:
Exhaust gas from the furnaces pass through a heat recovery boiler and is released to the atmosphere without treatment. The use of bag filters or multi-cyclones will reduce emissions of iron oxide dust. Provision of fume capture equipment will allow dust and NOx emissions to comply with IFC requirements. Although emission control would treat the exhaust from the furnaces to meet IFC guidelines, phasing out the OHF with replacement by EAF equipped with bag filter plant might be considered by Chusovskoy as the best practical environmental option in the longer term.
Sinter Plant:
The plant requires reconstruction to modern standards to improve energy efficiency and to reduce the generation of PAH and other pollutants. This would improve the effectiveness of emission control plant.
Blast Furnace Area:
In order to improve the working environment. Chusovskoy plans to install a dust capturing system. Emissions after the emission control system will comply with IFC requirements.
Liquid effluent treatment:
The program to clean the discharge water comprises the recovery of manganese and vanadium from waste water. The process includes the use of ozone to oxidize manganese. The manganese and vanadium oxides are then precipitated for reprocessing. Final effluent discharge will comply with IFC requirements. The existing “once through” water system will be replaced by a water recirculation system, which remove oil and suspended solids from the water.
Community Relations and Development Initiatives:
OMK has a good relationship with local communities around their facilities. The social audit that was conducted as part of the EHS audit highlighted the following challenges: management of communication with residents, public consultation and disclosure, and poverty reduction. In order to further improve its relationship with all stakeholders, a Public Consultation and Disclosure Plan (PCDP) will be prepared for each facility, and its implementation will be closely monitored during the coming year. The purpose of the PCDP is to build a relationship with stakeholders, address environmental and social challenges of development, and to ensure that stakeholders are informed of the company’s activities. This will promote trust between OMK and its stakeholders. OMK has agreed to:
- prepare for each site a PCDP and at corporate level develop local development
- strategies to address how they wish to interact with local communities; and
- engage, as outlined in the PCDP, more proactively with surrounding communities,
- unions, business associations and municipal/local government and will prepare
- Community Development Plans (CDP) as needed.
