Environmental & Social Review Summary
Project Number
10154
Company Name
Swazi Wattle Industries (Pty) Ltd
Date ESRS Disclosed
Feb 5, 2010
Country
Eswatini
Region
Africa
Last Updated Date
Jan 2, 2017
Environmental Category
B - Limited
Status
Completed
Previous Events
Approved : May 11, 2000
Signed : Jul 5, 2000
Invested : Apr 19, 2001
Sector
All Other Basic Organic Chemical
Industry
Manufacturing
Department
Regional Industry - MAS Africa
Project Description
ENVIRONMENTAL REVIEW SUMMARY
Project Name Swaziland – AEF Swazi Wattle
Region Sub-Saharan Africa
Sector Timber, pulp and paper
Project No. 010154
1. This project involves the expansion of Swazi Wattle Industries (SWI), which produces tannin extract for the leather tanning industry utilizing the black wattle (Acacia mearnsii) trees that proliferate the highlands of Swaziland. SWI established a pilot plant in Matshapa, Swaziland, in July 1997, which initially produced solid tanning extract. As a result of customer demand for powder extract (known as Mimosa), considered to be a superior product, a spray drier was added in 1998. The pilot plant, which has a capacity of 2,000 tons per annum (tpa), successfully demonstrated the production process and quality of output at the Matshapa plant. SWI now intends to expand to a total production capacity of 12,000 tpa by establishing a new wattle powder extract plant in the Nhlangano region of Swaziland. SWI has obtained the only license in Swaziland to process the bark of black wattle, a tree that is farmed extensively by the private sector, largely small-scale farmers on Swazi Nation Land (which is owned by the state but allocated by traditional leaders) in the eastern highlands of Swaziland. Estimated reserves of bark exceed five times the requirements for the two plants. Although wattle trees are exported to South Africa and Europe for use in the paper and pulp industry, the bark is regarded as a waste product. All the output of SWI is intended for export. Solid extract is sold mainly to India, China and Iran, while Mimosa Powder is sold to markets in Europe, America and the Far East.
2. This is a Category B project according to IFC''s environmental review procedure because specific impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines, or design criteria. The key environmental health and safety issues that were analyzed are as follows:
• source and sustainability of raw material (bark) for processing, including any Government plans to expand black wattle plantations;
• source of water and power supply, including fuel storage if applicable;
• air emissions;
• workplace air quality;
• recycling, treatment and disposal of solid wastes;
• recycling, treatment and disposal of liquid processing wastes and sewage;
• handling and storage of potentially hazardous materials;
• employee exposure to dust, heat, noise and hazardous materials;
• compliance with IFC policy on harmful child labor, as well as national labor standards and regulations;
• provision of personal protective equipment and health and safety training for employees;
• fire protection and emergency response; and
• general plant safety and housekeeping.
3. IFC has reviewed environmental information supplied by Swazi Wattle, as well as the findings of a recent report prepared by Danish Cooperation for Environment and Development (DANCED) for the Swazi Ministry of Environment and Energy on Forest Policy and Legislation (November 1997); and a 1990 report by the German organization Gesellschaft für Technische Zusammenarbeit''s (GTZ) Forest Inventory and Planning Project in Swaziland. Key elements of this information are described below.
4. Source and sustainability of raw material (bark) for processing, including any Government plans to expand black wattle plantations: According to information provided by the sponsors and several large plantation owners, the amount of black wattle bark available within the country is more than adequate to supply both the pilot plant and the new facility. The GTZ study cited above estimated that, in 1990, there were approximately 25,000 hectares (ha) of black wattle in Swaziland. About 50% of this total grows on large, privately held commercial plantations. The balance is grown by small-scale farmers in naturalized woodlands (known as wattle "jungles") located primarily on Swazi Nation Land. The Government does not own any timber plantations. In the absence of a formal forest management plan for these wattle jungles, the small-scale holdings are expanding slightly every year by self-propagation. However, because they are not properly managed, these holdings are producing sub-optimal yields. Several of the large privately held plantations have obtained or are in the process of obtaining certification from the Forestry Stewardship Council (FSC). SWI''s single largest supplier of bark, which owns one of the largest plantations in Swaziland, has obtained FSC certification.
5. Source of water and power supply, including fuel storage: Water requirements for the pilot plant are approximately 40 cubic meters per day, obtained from the municipal water supply. The new plant will require 168 cubic meters per day, which the sponsors intend to obtain from boreholes on the property. If insufficient water is available from boreholes, then the plant will utilize municipal water. Electricity at both the existing pilot plant and for the new plant will come from the national grid. As the electricity supply is quite reliable, no standby generators will be required at either plant.
6. Air emissions: The production process involves the chipping of bark to a uniform size, which is then leached in a hot water solution inside large stainless steel tanks. Depending on the color of the bark in any given batch, a small amount of bleach (chemical name, Sodium Meta Bisulphate 2% solution) may be added to the solution to ensure that the resulting tannin is the requisite color. The solution is then evaporated and concentrated to provide the tannin extract, and a spray drier is used in the concentrating process to produce Mimosa powder, which is then packed into polypropylene bags. There are no significant emissions from the processing plant. The existing plant utilizes one coal-fired, 500,000 Btu per hour boiler. Although the new plant will have five times the capacity as the pilot plant, it will be equipped with a new boiler (of the same size as the existing boiler) and will result in an estimated 30-35% improvement in thermal efficiency at the new facility. Neither boiler is expected to generate significant emissions.
7. Workplace air quality: The air quality in the pilot plant in Matshapa is very good. Much of the processing (chipping, leaching, evaporating and concentrating) is done outside, under high, corrugated iron roofs over the tanks. There are virtually no air emissions, with the exception of small amounts of fugitive steam, from these operations. Bagging of the product (Mimosa powder) is done inside a large shed fitted with a corrugated metal roof. At the time IFC visited the plant it was working at full production and there were no visible dust emissions inside the bagging shed, even in the immediate vicinity of the bagging machinery. Employees involved in bagging operations are nonetheless supplied with dust masks and instructed to use them if dust from a particular batch is excessive. According to the sponsor, this is rarely necessary.
8. Recycling, treatment and disposal of solid wastes: The only solid waste generated by the process is a fibrous by-product, which is sold as mulch to local floriculture companies. Ash from the boilers is collected by the Swazi Army and used to stabilize "black cotton" soils that occur in parts of the country, which otherwise become impassable during periods of heavy rain.
9. Recycling, treatment and disposal of liquid processing wastes and sewage: The leaching tanks generate a small amount of process wastewater, which consists of water mixed with tannin dust. The mixture is pH neutral and is used to irrigate lawns around the facility as well as the gardens of some of some residents. Sewage from the facility is discharged to the municipal sewerage system.
10. Handling and storage of potentially hazardous materials: As noted, the only chemical input to the process is ordinary bleach. At the pilot plant, the bleach is stored in large (210 litre) drums in a secured room inside the main plant shed. These stores can only be accessed by staff who have been trained as to when in the production process the bleach must be added and in what quantities. A similar system will be put into place at the new facility.
11. Employee exposure to dust, heat, noise and hazardous materials: The processing area generates very little dust, heat or noise, and no hazardous materials are used in the process, with the exception of bleach, which is handled and stored in a safe manner (see item #10 above). As mentioned above, dust emissions from bagging operations are minimal. Although output at the new plant will be five times the output at the pilot plant, dust emissions are expected to be of a comparably low level. Employees feeding coal into the boiler are exposed to coal dust, and the use of dust masks by these employees must be strictly enforced. Employees working in close proximity to the boilers and processing tanks must be provided with heat masks and leather gloves. These issues are discussed in greater detail in item #13 below.
12. Compliance with IFC policy on harmful child labor, as well as national labor standards and regulations: The pilot plant employs 35 full-time staff in the processing facilities; the new plant will employ approximately double this number. In addition, both facilities will employ casual labourers on an as-needed basis for tasks such as unloading bark from transport vehicles. All employees are 18 years of age or older, and all are paid in excess of the minimum wage established by the Swazi government. The sponsors have read both the "IFC Policy Statement on Forced Labor and Harmful Child Labor;" and "IFC Interim Guidance (July 8, 1999) on Harmful Child Labor" and agreed to abide by the principles set forth in these documents.
13. Provision of personal protective equipment and health and safety training for employees: SWI provides overalls, gum boots, and rubber gloves to all casual labourers as well as to its full-time staff. Employees working in the bagging section are provided with dust masks, as discussed above. Employees working in the boiler area are provided with overalls and gum boots. At the time IFC visited the plant, many but not all of the employees observed were wearing the requisite personal protective clothing and equipment. IFC has asked the sponsor to institute and enforce more stringent requirements regarding the use of this equipment. In addition, IFC has asked the sponsor to provide and enforce the use of dust masks for employees loading coal into the boiler, and heat masks and leather gloves to all employees working in close proximity to the boilers and processing tanks. SWI has agreed to implement all of these requirements. SWI has implemented a policy of “Dusty Areas” at which applicable notices have been placed. The Standard Practice Instruction has been modified accordingly.
14. Fire protection and emergency response: Although the finished product is not inflammable, the raw bark is. The pilot plant is equipped with fire extinguishers placed in strategic locations throughout the facility. In addition, there is a ring of fire hydrants in the area where the bark is stored. All staff are trained in fire prevention and response, and fire drills are held once a month. The sponsors intend to install the same fire safety equipment at the new facility, and to conduct an identical training and fire drill program as well.
15. General plant safety and housekeeping: On the day that IFC visited the pilot plant it was operating at full production, and general plant safety and housekeeping appeared to be excellent. The entire facility was neat, clean and well ordered. Machinery is equipped with requisite safety shields, guard rails and insulation.
16. Other: As noted above, approximately half of all the black wattle grown in Swaziland occurs on communally-held Swazi Nation Land, allocated to individuals by the traditional chief of a particular jurisdiction. Many of these individuals are attempting to derive an income from their land allocation without either sufficient knowledge of sustainable silviculture management principles, or adequate resources to implement these principles. The project sponsor, in conjunction with the owner of one of the largest wattle plantations in the country, has established a separate company, Khulanatsie (Pty.) Ltd., to attempt to both rehabilitate these naturalized forests and to assist these smallholders to optimize the amount of income that can be derived from their holdings. The intent of the Khulanatsie initiative is to provide technical and marketing assistance including site selection and land preparation; planting, pest and weed control; fire protection and harvesting. The company will offer below-market loans to small-scale farmers to enable them to maximize their production levels by waiting until trees reach an economically viable size before harvesting. The company will also help the farmers to secure markets that pay a fair and timely price for their products. While not a direct component of the investment project being considered by IFC, the Khulanatsie initiative is important in extending sound and sustainable forest management programs to the small-scale sector, as well as helping small-scale growers to achieve a fair return for the products generated by these holdings.
17. Based on its review of available information regarding potential environmental impacts and proposed mitigation measures, IFC concludes that the proposed project is being designed and will be operated to meet pertinent Government of Swaziland and all relevant World Bank Group policies and environmental, health and safety guidelines.
18. IFC will monitor ongoing compliance with World Bank Group policies and guidelines during the life of the project by evaluating monitoring reports submitted annually to IFC by the sponsor and by conducting periodic site reviews during project supervision.
Environmental and Social Mitigation Measures
Broad Community Support
Related SII
