29444 - GC Prim Moldova

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Environmental & Social Review Summary

Project Number

29444

Company Name

IM Glass Container Company SA

Date ESRS Disclosed

Sep 13, 2011

Country

Moldova

Region

Europe

Last Updated Date

Jun 3, 2021

Environmental Category

B - Limited

Status

Completed

Previous Events

Approved : Dec 12, 2011
Signed : Dec 21, 2011
Invested : Mar 21, 2012

Sector

Glass and Glass Products (Including Glass and Mineral Wool)

Industry

Manufacturing

Department

Regional Industry MAS LAC & EUR

Project Description

IFC proposes debt and equity financing of Glass Container Prim S.A.(“GC Prim” or the “Company”). Located in Chisinau, Moldova, the Company is a manufacturer of flint glass containers, and has been operational since May 2010. GC Prim was established as the sister company of the current Moldovan market leader in glass packaging production, Glass Container Company (“GCC”), which manufactures colored glass containers and has an annual production capacity of 110 million bottles per annum. GC Prim and GCC share the same premises.

Overview of IFC's Scope of Review

The IFC’s appraisal of this project included the following:

Site visit to the container glass production plant of GC Prim and GCC located in the same campus in Chisinau;
Meetings with the Company’s management team, engineering, production and human resources staff;
Review of available environmental and social documentation including the appraisal questionnaire submitted by the Sponsor, environmental monitoring reports, permits, human resources procedures.

E & S Project Categorization and Applicable Standard

While all Performance Standards (PS) are applicable to this investment, IFC’s environmental and social due diligence indicates that the investment may have impacts which must be managed in a manner consistent with the following Performance Standards:

- PS 1: Social and Environmental Assessment and Management Systems
- PS 2: Labor and Working Conditions
- PS 3: Pollution Prevention and Abatement
- PS 4: Community Health, Safety and Security

The project site is located in an industrial zone and no further land acquisition is planned. Therefore, no impacts are anticipated in relation to PS 5: Land Acquisition and Involuntary Resettlement, PS6: Biodiversity Conservation and Sustainable Natural Resource Management, PS7: Indigenous Peoples, PS8: Cultural Heritage.

The key social, environmental, health and safety (EHS) issues reviewed with this investment include; company''s capacity to manage EHS performance in its operations, compliance with national permitting requirements, terms of employment and working conditions, occupational health and safety (OHS), emissions to the environment (especially to air), consumption of energy and control of greenhouse gas emissions.

The information about how these key issues will be addressed is summarized in the following sections of this Environmental and Social Review Summary (ESRS) and in the attached Action Plan (ESAP) agreed upon with the Company.

The Project has limited potential adverse environmental and social impacts, and those that do exist are site-specific and can be resolved through the effective implementation of good international industry practices and action items in the ESAP, which integrate the IFC requirements.

This proposed investment is therefore a Category B project according to IFC’s Environmental and Social Review Procedures.

Existing and proposed measures to manage and mitigate these risks are described below.

Environmental and Social Mitigation Measures

PS1: Social and Environmental Assessment and Management Systems

Environmental and Social Assessment:
The Company’s operations in Chisinau are subject to regulatory controls by the Ministry of Ecology and Natural Resources and reported to be in compliance with local environmental regulations which are under development for approximation to the EU Environmental Legislation. Environmental assessment reports are available for the Company, covering several environmental aspects related to the production activities, taking into consideration capacity of installations and types of emissions.

The Company’s environmental permit was issued for GCC in 2009 and is valid until 2014. The Company is in the process of making necessary arrangements for the issuance of a new permit for GC operations as well.

Labor relations and occupational health and safety conditions are also subject to controls by the regulatory authorities with particular attention to employee health monitoring which consists of comprehensive medical checks prior to hire and periodically during employment.

Management Programs
The Company operates under an ISO 9001-certified Quality Management System and intends to develop environmental and occupational health and safety management systems certified compliant with the requirements of ISO 14001 and OHSAS 18001 respectively, in line with the policy for continuous improvements of its environmental, health and safety (EHS) performance. For this purpose, the Company will designate an EHS Coordinator, review and extend its organization and staffing as necessary in order to develop and operate EHS management systems capable of certification compliant with internationally recognized standards and IFC requirements. As GC Prim and GCC are located on the same site at Chisinau performing similar operations under shared management and support staff, the management programs will be jointly developed for both entities.

Local legislation regulates utilization of resources and pollution control mechanisms particularly for air and water. Monitoring of air emissions is predominantly driven by surveillance of ambient air conditions. An external environmental agency agreed by the local authorities conduct quarterly measurements of air quality within the Company site premises and boundaries.

PS2: Labor and Working Conditions

Labor Relations:
GC Prim has an internal human resources procedure which describes in particular, hiring and contract making processes and general working conditions in line with the local regulations. The minimum age of employment is 18. Company management stated that there is no discrimination on the basis of personal beliefs or characteristics and no prohibition or discouragement of freedom of association. In practice there is no union activity or collective agreement in the manufacturing sites; employees are working through individual contracts which describe basics of working conditions. As reported by the Company management, employees are free to communicate grievances to the management directly or via elected worker representatives. The Company will review and enhance its human resources policy and procedures to include formally structured internal grievance redress mechanisms for its staff and contractors and ensure that all IFC Performance Standard 2 requirements are formalized in a documented manner.

The current number of employees at GC Prim working at manufacturing activities is 93. Management and administrative staff are shared by GCC. The total number of employees in GC Prim and GCC equals to 396. The Company will make necessary arrangements to avoid or minimize any potential retrenchment in the future due to modernization of production activities, creating new job opportunities or enabling internal transfers into other functions to the possible extent.

Occupational Health and Safety (OHS):

Workplace place monitoring in terms of noise and climate conditions are conducted and certain corrective actions have been planned such as installation of additional ventilation at GCC furnace area. As identified in the ESAP, more systematic and comprehensive risk assessment programs will be introduced. In order to minimize further occupational health and safety risks, the Company will take a number of actions such as enhanced containment of dust emissions at batch houses, review of and enforcement of personal protective equipment and development of behavioral safety programs. Risk mitigation measures will focus on the implementation of engineering controls wherever applicable.

Accident/incident causes are investigated; corrective actions are undertaken with the intention of preventing recurrence. Medical personnel is formed by three occupational physicians and two nurses attending regularly special medical courses and upgrading their knowledge related to medical assistance.

The Company has good quality welfare and social facilities for the employees. In accordance with the local legislation in force by the Ministry of Health in Moldova, there is a medical unit within GCC serving both GCC and GC Prim with all necessary equipment and medications in order to supply the first aid assistance in case of accidents or other illness, special format documentation necessary to register the patients and other statistical data and informational panels with all necessary information to be communicated to the employees on occupational health.

PS3: Pollution Prevention and Abatement

- Emissions to Air:

GC Prim has currently one furnace dating from 2009, which started to operate in May 2010, with a capacity of 220 tons/day, designed to supply two 10 section IS machines, with capacity available for future supply of additional forming operations.

GCC has one operational furnace, located in the same factory. This furnace started operations in August 1997 and was cold repaired in 2004. The furnace of GCC has a capacity of 200 tons/day and is designed to supply two 8 section IS machines.

Both furnaces are fired by natural gas, and therefore SO2 emissions are compliant with both local requirements and World Bank Group (WBG) guidelines.

Measurements show that point source NOx emissions from the melting furnace of GC Prim are higher than 2,000 mg/Nm3, exceeding WBG guidelines. No emissions data for particulate matter from point sources are available.

Continuous monitoring systems for particulate matter and NOx will be installed at both company’s furnace stacks. Additional regular monitoring will be performed at point sources in line with the WBG guidelines to cover all applicable parameters including lead and other heavy metals, if and when these are included in the batch. In addition, the Company will amend the ambient air monitoring program ensuring that the monitoring points are appropriately located, samples are taken in adequate number and duration and results are interpreted with the internationally agreed standards and IFC requirements in addition to the local regulatory requirements.

To reduce air emissions and to improve energy efficiency, effective primary control measures will be implemented at GCC furnace to the extent practical during the cold repair planned for 2014.

GCC and GC Prim will plan to implement a continuous improvement program to reduce emissions of NOx and particulate matter. The initial aim will be to control NOx to less than 1,200 mg/Nm3 and particulate matter to less than 100 mg/Nm3 by the end of 2014 using primary control techniques such as modification and control of combustion conditions, modification of batch composition, utilization of low-NOx burners and furnace revisions to limit air in-leakage. If heavy metals are detected in flue gas emissions, then filtration systems will be introduced to reduce particulate emissions further, in accordance with the WBG Glass EHS guidelines.

At this stage, further reference will be made to the impact of GCC’s and GC Prim’s operations on local ambient air quality, by reference to ambient air quality data, point source emissions and an emissions dispersion model. If these glass operations are shown to be a major contributor to degradation of local ambient air quality, then further secondary controls may be necessary to meet ambient air quality objectives. Notwithstanding IFC’s own requirements, the Company will comply with the requirements of the local regulator.

- Emissions to Water:

Wastewater from the manufacturing sites comprises particularly glass and cullet cooling water and sanitary wastewater. Process water is treated on-site and recycled to the process to minimize effluent quantity. Excess water along with other effluents are discharged to the municipal sewage system of Chisinau, in accordance with the local regulatory requirements. The Company will establish an effluent monitoring framework in line with the WBG guidelines.

- Wastes & Hazardous Materials:

The Company strives for waste minimization through recycling and reuse of materials wherever practical. Further reduction is targeted through improved productivity of glass making process control to reduce the rejected glass, and overall technology development to increase plant efficiency. The reduction of solid waste is achieved mainly by the reuse of waste glass in the process. Other recyclable wastes such as waste oils, paper and cardboard waste are also recycled where possible. Wastes are collected and stored securely on-site according to local rules and regulations, then transferred to authorized institutions for treatment, recycling or disposed to the authorized landfills. The Company will formalize its waste management activities on documented procedures.
GC Prim and GCC do not use large quantities of heavily hazardous material in their operations. There is no printing process, therefore, no dyes containing heavy metals are used. A number of auxiliary materials such as acids which are used for bottle covering are handled by duly trained personnel. The Company will maintain composition data for all chemicals and raw materials used in the operations and will continue to do systematic review for availability of more environmentally friendly alternatives.

- Energy and Resource Efficiency / Control of Greenhouse Gas Emissions:

The furnaces are efficient regenerative end-port designs. All combustion and other process parameters are strictly controlled through computerized systems to monitor and optimize material and energy consumption. The Company has identified measures to improve production efficiency which will contribute to reduce energy consumption per unit product. Installation of additional high performer forming lines and electro-boosting system at the furnace of GC Prim is among these measures and will be supported by IFC funds in the context of this project. The energy consumption per unit product is expected to be further reduced by 10-15% through these installations. The company will seek to increase use of cullet in batch, subject to availability of cullet of adequate quality to maintain product quality.

The Company will report to IFC greenhouse gas emissions data on an annual basis. It is expected that GHG emissions associated with the Company’s proposed annual production of 60,000 tonnes of glass containers will be around 42,000 tonnes CO2 equivalent.

GC Prim and GCC have also introduced water conservations programs. Process effluents are re-circulated after passing through an on-site treatment system which minimized water consumption in the manufacturing operations.

GC Prim and GCC have also introduced water conservations programs. Process effluents are re-circulated after passing through an on-site treatment system which minimized water consumption in the manufacturing operations.

PS4: Community Health, Safety and Security

GC Prim is located in an industrial zone, therefore potential impacts to community are limited. Road traffic is minimized by the use of rail transport of raw materials to the sites. Emergency management plans are maintained in accordance with the regulatory requirements. Environmental emissions including noise and air emissions are controlled and will be further reduced as defined in the previous sections.

Stakeholder Engagement

The factory is located in an industrial zone and most of the employees generally come from the local area hence the community is particularly aware of the manufacturing activities through this informal channel. During the appraisal visit IFC received information that there was no public opposition to any operation of GC Prim and GCC, on contrary the Company’s operations are well supported by the community.

The Company attach high importance to educational development. GCC initiated a specialized faculty at Polytechnic University of Moldova, under the name of “Technology of Glass and Ceramics Manufacturing” providing vocational training, hence creating skilled employment opportunities.

Given the extent and type of the investments planned within this Project, there is no regulatory requirement of public consultation and the information will be first shared with the community through publishing this Environmental and Social Review Summary and the relevant action plan.

The Company will establish communication procedures to share information with third parties about on-going environmental and social performance as part of the targeted implementation of the environmental, health and safety management systems in accordance with IFC requirements and international management system standards.

Client Documentation

File Name	Actions
G C Prim ESAP August 2011.pdf

**Information on IFC's Policy and Performance Standards on Environmental and Social Sustainability can be found at www.ifc.org/sustainability

IFC supports its clients in addressing environmental and social issues arising from their business activities by requiring its real sector clients to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities in relation to environmental and social issues arising from IFC's clients' business activities. Since 2012, IFC's Financial Intermediary clients applying the Performance Standards are required to develop External Communications Mechanisms to receive and review inquiries or complaints from any interested party regarding the E&S risks and impacts of their operations.

For IFC projects that are active or under consideration, individual(s), or their authorized representative(s), who allege they have been or will be adversely affected by E&S risks or impacts arising from IFC's clients' business activities, may submit a complaint to IFC directly for consideration. When receiving an E&S complaint, IFC engages with complainants and works with its clients to find solutions to E&S concerns as quickly and efficiently as possible.

Complaints can be submitted to IFC online at www.ifc.org/escomplaints or by email to EScomplaints@ifc.org.

IFC complaint response is separate from and complementary to IFC’s clients’ project level grievance mechanisms and IFC’s Independent Accountability Mechanism (CAO). Lodging a complaint directly with IFC does not, at any time, restrict access to CAO.

Affected communities have unrestricted access to the Compliance Advisor Ombudsman (CAO), the independent accountability mechanism for IFC and MIGA. CAO facilitates the resolution of complaints related to IFC and MIGA projects and sub-projects, undertakes reviews of IFC’s and MIGA’s environmental and social compliance, fosters public accountability for their commitments, and enhances the environmental and social performance of IFC and MIGA.

Independent of IFC and MIGA management and reporting directly to the IFC and MIGA Boards of Executive Directors, CAO helps resolve issues raised about the environmental and social impacts of projects through a neutral, collaborative, problem-solving approach via its Dispute Resolution function. It also reviews IFC’s and MIGA’s compliance with environmental and social policies, assesses related harm, and recommends remedial actions through its Compliance function. Additionally, CAO provides advice to IFC, MIGA, and their Boards to enhance environmental and social sustainability performance and minimize the risk of harm.

Complaints may relate to environmental and social harm regarding any aspect of the planning, implementation, or impact of a project or sub-project, and can be made by any individual, group, community, entity, or other party affected or likely to be affected by the environmental or social impacts of an IFC- or MIGA-financed business activity.

Complaints can be submitted by any of the following methods:

Online form: available at https://www.cao-ombudsman.org/
Mail/Hand Delivery to: 2121 Pennsylvania Avenue, NW, Washington, DC 20433, USA
Voice mail: +1 202 458 1973
Email: cao@worldbankgroup.org
SMS, WhatsApp, Telegram, and Signal: +1 202 650 2627

CAO receives and addresses complaints in accordance with the CAO Policy, which can be accessed at: https://www.cao-ombudsman.org/policies-guidelines.

This Environmental and Social Review Summary (ESRS) is prepared by IFC to disclose its findings and recommendations related to environmental and social considerations regarding potential investments. Its purpose is to enhance the transparency of IFC's activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this ESRS is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein.
It is distributed in advance of IFC Board of Directors' consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following ESRS is disclosed in accordance with IFC's Access to Information Policy (AIP).

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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