9862 - SEF CASPI Limited

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Environmental Review Summary

Project Number

9862

Company Name

CASPI Limited

Date ERS Disclosed

Sep 7, 2000

Country

Kazakhstan

Region

Central Asia and Turkiye

Environmental Category

B - Limited

Status

Completed

Previous Events

Approved : Sep 22, 2000
Signed : Oct 4, 2000
Invested : Dec 19, 2001

Sector

City and Business Hotel

Industry

Infrastructure

Department

Regional Industry MAS MCT

Project Description

The proposed project consists of the expansion and development of the Chagala Hotel, a three-star hotel in Atyrau in Western Kazakhstan and of a small guesthouse in Bautino very close to the Caspian oilfields, Both properties are owned by Caspi Ltd. The hotel and guesthouse''s target market is oil workers and associated staff involved with the oil exploration and development work in the Caspian. The expansion at the Chagala will consist of building three small blocks of long-term guest suites and offices, adding approximately 45 units. The Chagala currently has 105 units. The Bautino guesthouse is a lower quality accommodation than a hotel, offering basic room and board service. The project will expand the six room guest house by nine rooms. An office building may be included in a later phase.

Environmental and Social

The information provided about how these issues and potential impacts have been addressed in the development of the project is summarized in the paragraphs that follow.

- Land acquisition and development:

Land for the new construction is part of existing sites. In Atyrau, the new buildings will be constructed on the hotel''s tennis court. The sponsor may acquire an adjoining 0.5 hectares in Atyrau for new construction; the purchase will be through a willing/seller willing buyer relationship.

- Environmental management program:

The company will develop an environmental management program, with the general manager of the Chagala Hotel taking responsibility. The initial emphasis of the environmental management program will be on reducing resource use, with possible cost savings. As part of this effort, the company will also adopt a code of environmental conduct through an international program. The environmental management program will cover both the Chagala Hotel and the Bautino guesthouse.

- Quality of drinking water:

Drinking water at both the hotel and the guest house has been tested and found to meet Kazakhstan and World Health Organization standards for potable water.

- Air emissions:

Heat for the Chagala is through a city-wide distribution of steam heat. The hotel does not have its own boilers. On-site generation at the hotel is limited to a back up generator. Under the expansion program the generator will be moved to a new dedicated building, which will include a spilled containment wall. The guesthouse does not have a back-up generator and, therefore, has no oil storage tanks. Central air conditioning units, manufactured by Carrier, provides heating and cooling at the Bautino guesthouse. Similar units will be used for the expansion.

- Liquid effluent treatment and disposal:

Liquid effluent from the existing hotel goes into the municipal system of Atyrau. The Sponsor has provided IFC with a letter from the municipality stating that the latter can receive and treat the wastewater from the hotel and its expansion. The liquid effluent at the Bautino guesthouse is collected by a third party and delivered for disposal to the local municipality, Fort Shevtchenko. The sponsor has provided a letter from the municipality indicating that it treats the effluent according to national laws and regulations. It further confirms that it can accept the additional effluent from the expansion of the guesthouse.

- Solid waste disposal:

Waste disposal is and will continue to go into the Atyrau municipal landfill. At Bautino, the same third party who removes waste water removes solid waste and similarly delivers it to the local municipality. The sponsor has provided a letter from the municipality indicating that it disposes of the solid waste according to national laws and regulations. The municipality further confirms that it can accept the additional solid waste generated by the project, including construction waste.

- Dry cleaning fluid disposal and CFC use:

The hotel does not have on-site dry cleaning facilities, nor does it use CFCs or HCFCs in its refrigeration systems. The guesthouse in Bautino uses HFCs in its air-conditioning units, which are an acceptable alternative. The company will not use CFCs or HFCFs in any new air conditioning units and will accommodate to any future obligations that Kazakhstan may have under the Montreal Protocol.

- Fire safety:

The Belgian fire safety specialists, FPC, completed a fire safety audit of the hotel. The report concludes that the level of fire safety at the Chagala is acceptable subject to the implementation of a number of recommendations. FPC, on IFC''s behalf, together with the sponsor Caspi, Ltd will implement the recommendations to a timetable, which will form part of the loan agreement and will be a condition of project completion. For the Bautino guesthouse, a desktop review of the life and fire safety system was conducted base on drawings and information made available by the company. Subject to the implementation of a number of recommendations and a review of the overall site plan, the building was deemed satisfactory. The new buildings will meet NFPA codes and World Bank Group Life and Fire Safety Guidelines.

- Employee health, safety and training:

Kazakhstan law requires that all employees be trained and examined on health and safety matters. The hotel is in compliance with these laws. The Bautino guesthouse has a staff of two, and the need for training is at present limited. The Sponsor will, however, increase staff training as the size increases.

Conclusion & Monitoring

IFC will monitor ongoing compliance with World Bank Group environmental, social, health and safety policies and guidelines during the lifetime of the project by evaluating reports submitted annually to IFC by the sponsor and by conducting periodic supervision. In particular, IFC will require annual confirmation:

- Quality of drinking water;
- Quantities of liquid and solid waste;
- Generation of hazardous waste
- Maintenance of fire safety recommendations;
- Employee health, safety and training;
- Compliance with national and local environmental, health, safety and labor laws.

This Environmental Review Summary (ERS) is prepared and distributed in advance of the IFC Board of Directors' consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board of Director’s decision. Any documentation that is attached to this ERS has been prepared by the project sponsor or in conjunction with the project sponsor and authorization has been given for public release. IFC has reviewed this documentation and considers that it is of adequate quality to be released to the public but does not endorse the content. The following ERS is disclosed in accordance with IFC's Disclosure of Information Policy that went into effect September 1998.

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

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