Key environmental, occupational health and safety and social impacts/risks of the project include: (i) Environmental and social impact assessment; (ii) Environmental, occupational health and safety management system; (iii) Labor and working conditions of permanent and seasonal employees; (iv) Occupational health and safety of core agricultural operations and sugar manufacturing facilities; (v) Energy and water consumption and efficiency; (vi) Pesticide and fertilizer management; (vii) Wastewater and solid waste management; and (viii) Communications with local communities.
Astarta has presented plans to address environmental and social impacts to ensure that the proposed Project will, upon implementation of the specific agreed measures included in the Environmental and Social Action Plan (“ESAP”) attached to this summary, comply with host country laws and regulations, the IFC’s Performance Standards and the WBG EHS Guidelines. The information about how these potential impacts will be addressed by the Company is summarized in the paragraphs that follow.
PS1: Social and Environmental Assessment and Management System
Environmental and Social Assessment:
Ukrainian legislation requires all new developments to carry out environmental impact assessment (EIA) studies and evaluate potential negative impacts on environmental and social conditions followed by approvals for operation and relevant permits. EIA are undertaken for all sugar mills being renovated by replacement of outdated equipment and installation of new facilities.
The EIA studies are in progress for the biogas facility currently being constructed and for the new soybean crushing plant. Astarta has been developing internal procedure for the environmental and social assessment of its new developments. The Company will develop the environmental and social (E&S) management plans based on EIA studies outcomes and apply its corporate procedure for EIA for these projects to ensure addressing impacts and risks associated with the construction and operation phases. Prior to formal leasing of new land for cultivation, the Company will amend the existing procedures by including internal screening of new land plots for early identification of potential environmental and social risks and impacts associated with past use of land, vicinity of water bodies, villages, local infrastructure. If risks to biodiversity are identified through this screening, more detailed assessment and analysis in compliance with PS1 and PS6 will be undertaken.
Environmental and Social Management System, Organizational Capacity and Reporting:
The Company has already adopted a corporate EHS policy and goals, management programs, organizational structure, internal audit, analysis, monitoring and reporting procedures in line with the international standards ISO 14001 and OHSAS 18001. The Company has committed to incorporate IFC’s Performance Standards and WBG’s EHS Guidelines as applicable E&S requirements in the development of its Environmental, Health and Safety (EHS) management system in 2011. Specifically, Astarta’s head office and one sugar plant have been ISO 14001 certified. Four sugar plants obtained certificates of compliance with ISO 9001 standard using Ukrainian’s legal and regulatory requirements. Going further Astarta will consider feasible actions to follow the RTRS (the Round Table on Responsible Soy Association) international initiative for responsible production of soy through implementation of the RTRS standard. The Company will develop a plan for gradual implementation of the RTRS principles and criteria in Astarta new and growing rapidly business of soybean processing.
The management of environmental and social matters is the responsibility of Astarta’s local operational staff, as part of their direct responsibilities and EHS departments/ functions. Occupational Health and Safety (OHS) matters are coordinated by a corporate OHS manager and plant-level managers at each individual operation. The Company’s social programs are driven by personnel designated for community engagement and communications.
Astarta adopted and maintains procedures for selection and evaluation of contractors based on their EHS performance. The current E&S management system is being developed continuously. As set forth in the ESAP, Astarta will assign a suitably qualified and competent professional environmental manager on a corporate level to operate the corporate environmental and social management system and coordinate management systems of individual sites of the Astarta Group.
Training:
The Company has carried out training needs analysis and developed professional and EHS training programs to ensure up-to-date skills needed for specific work responsibilities. The programs are based on principles of equal opportunity to learn and continual training including external and internal corporate training by reliable training providers.
Monitoring and reporting:
Astarta and its operations submit annual reports on air emissions, wastewater tests and amount of generated wastes to authorities that supervise compliance with Ukrainian limits. Internal reporting about EHS issues is provided to the Company management within the framework of EHS management systems implementation.
PS2: Labor and Working Conditions
Human Resources Policy, Social Responsibility, Non-Discrimination and Equal Opportunity:
Astarta had approximately 8600 employees at the end of 2011, of which about 78% are operation staff. The employment surges up to maximum 13000 staff through hiring of seasonal workers in high season. Upon commissioning of the biogas facility and the soybean crushing plant, the Company will add approximately 180 local jobs. The Company developed and maintains a progressive human resource policy consistent with local labor laws and PS2. Discrimination in employment based on gender, race, age, ethnic and religious association, or nationality principles is prohibited by the policy. Astarta follows social responsibility principles being a member of United Nations Global Compact (UNGP) since 2008 and is committed to aligning its operations and strategies with principles in the areas of human rights, labor, environment and anti-corruption. The latest communication report on how the Company implemented these principles was published on Astarta UNGP webpage in January 2012. Further, motivation schemes, performance evaluation programs, comprehensive training programs contribute to retaining of personnel in the Company.
Working conditions and terms of employment:
Working conditions at Astarta operations comply with national labor laws and IFC’s PS2. Ukrainian legislation prohibited employment of children below the age of 16 years; children below 18 years are not employed in dangerous, night or overtime work; forced labor is not employed. Astarta keeps written contracts with permanent and seasonal staff. Contracts with employees and corporate regulations set up comprehensive terms of employment, including hours of work, wages and benefits, leave for illness, maternity, vacation or holiday, employees’ rights for labor protection, including right /freedom for professional associations, trade unions. Astarta offers a social package to employees, including financial aid and social benefits.
Workers’ Organizations:
About 80% of Astarta employees are members of trade unions; workers’ councils cooperate with management of individual operations where employees don’t belong to the trade unions. Collective agreements between administrations and workers provide for additional terms and benefits for employees and their families.
Grievance Mechanism
Astarta has developed and implements a formal internal grievance process consistent with IFC’s PS2 which allows grievances to be presented without the risk of oppression. All employees are informed about the grievance procedure upon employment. Additionally, the corporate code of conduct actively encourages employees and managers to openly discuss and resolve internal concerns.
Occupational health and safety:
Crop growing: Risks associated with pesticide and fertilizer handling; dust from product handling; heavy machinery operations and physical strain are reduced by adherence to safety rules and procedures developed by the Company. Field staff that have direct contact with the crop production products (CPPs) was given specific training in specialized training centers and internally. The Company carries out medical examination of employees at the time of entry on job and after that repeats the health examinations on a regular basis scheduled according to specific working conditions. As set forth in the ESAP, Astarta will amend the existing training programs of employees handling pesticides and provide documentary evidence that the training is based upon MSDS (material safety data sheet) and/or ICSCs (international chemical safety cards), and will fully integrate pest management procedures into the EHS management system manual. The Company will revise medical tests for workers handling CPPs containing organophosphates and carbamates formulations and will monitor the cholinesterase levels through implementation of the following steps:
i) Regular cholinesterase testing of employees to define if specific employees should be allowed to continue such practices and what specific levels dictate when employees should cease participating in such activities;
ii) Adoption and implementation of the policy for workers rotation to avoid chronic exposures to specific pesticides;
iii) Adequate training: Material Safety Data Sheets-based technical education for any chemical formulation employed, in the use of adequate Personal Protection Equipment (PPE);
iv) Inventory of available PPE and ensure availability of adequate PPE for employees exposed to contact with products.
Sugar manufacturing: Employees involved in the operation or maintenance and repair of sugar plants are exposed to specific OHS risks including high temperatures, vibration and noise, dust, work in confined spaces. Risks have been identified by Astarta within the framework of development of OHS management system at one pilot sugar plant and being expanded to other operations. The Company undergoes workplace monitoring and workplace certification made by licensed state agencies at crop growing and sugar production operations according to the national laws. Personnel exposed to risks exceeding national levels are provided by personal protective equipment and additional social benefits guaranteed by laws. Incidents in relation to the Company activities are recorded, investigated and reported; corrective actions are implemented to prevent re-occurrence.
Soybean crushing plant and biogas facilities: Risks associated with operation of future soybean crushing plant and biogas facilities are considered in project design documentation and prescriptions given to Astarta by relevant supervisory authorities. Biogas facility will be equipped with release valves, flares; personnel will be given gas detectors and specific training. Hazardous and toxic materials will be locked in specially equipped storage with limited access. EHS management plans mentioned under PS1 will be developed by Astarta to manage risks appropriately.
Astarta adopted a program for gradual replacement of asbestos containing materials (ACMs) used in buildings and constructions as roofing material and in equipment as thermal protection material by 2016. The risks associated with handling of ACMs and its disposal will be addressed through actions included in the ESAP.
OHS safety performance showed 7, 14 and 7 Lost Day Accidents (LDA) in 2009, 2010 and 2011 respectively. Accident frequencies LDA/MMH (LDA/Million Man Hours) over the last three years has been decreasing from 0.6 LDA/MMH in 2009 to 0.4 in 2011. Astarta improves its OHS performance through gradual implementation of OHSAS 18001 that will be completed in one sugar plant and the head office by 2012. Going further, the Company will continue improvement of its OHS performance and the management systems and will adopt a plan for development of the OHS management systems at other individual operations; priority will be given to operations in agricultural sector.
PS3: Pollution Prevention and Abatement
Resource Conservation and Energy Efficiency:
An assessment of best available techniques (BAT) was carried out by independent international consultants at four pilot sugar plants and one more BAT assessment is planned. The BAT assessment identified improvements that underlay a capital investment program for energy efficiency, reduction of resource use, establishment of wastewater treatment facilities, workplace safety to comply with Ukrainian and EU legislation, IFC PSs and WBG EHS guidelines for sugar manufacturing. Astarta develops logistic schemes for vehicle and agricultural machinery movement to minimize fuel consumption.
Sugar manufacturing: Power for sugar plants is sourced from own natural gas and coal fired power stations. Astarta considers a program for transferring heat power stations of sugar plants from gas to coal and, therefore, to ensure consistency with WBG EHS general guidelines the Company will develop an action plan, if needed, to comply with the limits for air emissions. Dust emitted from sugar production is captured in cyclones and bag filters. Monitoring of point source air emissions and its compliance with national limits are undertaken by supervisory authorities on a regular basis. Water is supplied from water bodies or own water wells. The liquid effluents are discharged to settling ponds. Astarta implements modernization program of sugar mills to reduce areas occupied by filtration/ settling ponds. Going further Astarta additionally will develop a long-term gradual program that will include feasible measures for improvement of sugar plants’ wastewater systems to prevent contamination of soil and groundwater, reduce areas occupied by sedimentation ponds and measures for remediation of areas used for wastewater treatment systems. Beet pulp is granulated and sold as animal feed. Also pulp from the sugar plants is considered for use in biogas production. Solid wastes are transported to local landfills or recycling by licensed contractors. Sugar plants submit annual reports on air emissions calculations, wastewater tests and amount of generated wastes to authorities that supervise compliance with Ukrainian limits.
Cattle farming: Wastewater with high concentrations of organics is collected in closed drainage systems and discharged to sedimentation ponds. At the visited farm, an on-site wastewater treatment plant (WTP) has been installed for mechanical separation of solid faeces from liquid effluent. The solid residue is temporary stockpiled on the special on-site concrete-enveloped area and then is used as organic fertilizer depending on seasonal conditions, while wastewater is discharged to sludge ponds. The animal waste is insufficient for the fertilizing of the Company''s crop-land. Manure spreading is carried out when the plants can utilize the fertilizer value, therefore run off risk associated with the animal waste is unlikely. Refrigerants used for chilling equipment include R22. Releases of R22 (also known as HCFC-22), such as those from leaks, contribute to ozone depletion and the Freon was included in the phase-out schedule according to terms of the Montreal Protocol that established requirements for the worldwide phase-out of ozone-depleting substances (ODS). Astarta has agreed no new equipment containing ODS will be purchased and a phase out plan to replace R22 by 2018 will be developed.
Biogas facility: Beet residues will be supplied from sugar mills as raw material. Water and power will be sourced from a sugar mill where biogas facility will be installed. Design documentation provides for installation of release valves and flare; hazardous materials will be stored in a specially equipped zone with restricted access.
Soybean crushing plant: Design documentation stipulates that water will be sourced from water well; wastewater will be treated at on-site treatment facilities and further discharged to sugar plant settling ponds; solid wastes will be delivered to a local landfill; the granulated soya coat will be used as animals feed or burned in the boiler of biogas facility; hexane solvent will be unloaded to a specially designed station and stored in underground tanks designed for safe storage of flammable petroleum products.
Emergency Preparedness and Response:
The visited facilities including seed treatment plant are equipped with life and fire (L&FS) means including fire extinguishers and detached fire water tanks. L&FS drills are carried out by the state fire service jointly with the Company staff. Emergency response plans are prepared at each Astarta individual operations in line with local laws. Also emergency response plans will be developed for both soybean crashing and biogas facilities in accordance with requirements of local legislation.
Greenhouse Gas Emissions (GHG):
Astarta developed a program for energy efficiency at two sugar plants and sold 60 775 tons of reduced GHG emissions in 2011. Additionally the Company plans to sell reduced GHG emissions within the energy efficiency programs for five sugar plant and biogas facility through utilization of beet bagasse. Estimated carbon dioxide emissions (CO2) from crop growing, sugar manufacturing operations in 2011 average about 260,000 tons in CO2 equivalent.
Pesticide and Fertilizer Application Management:
The Company uses fertilizers and pesticides certified and approved by Ukrainian authorities. Fertilizer types used range from pure Nitrogen and blends of Nitrogen, Phosphate and Potassium (NPK-fertilizers) to trace elements such as Boron. The need for fertilizer application is evaluated by considering the crop to be planted and soil sampling results, including acidity and NPK levels provided by an own soil test laboratory. These measures minimize overdosing of fertilizers and losses due to for example leaching and run off with rain water. Astarta considers weather conditions prior to application, does application in accordance with manufacturer instructions, and keeps buffer zones around water courses to avoid contamination of surface water. In 2007, the Company set aside some areas of land for no till technology that gave economic and environmental effects; Astarta intends to extent no-till areas.
Astarta actively works to improve pest management and minimize the use of chemical crop production products (CPPs). Handling, storage and use of personal protective equipment for agricultural chemicals, pesticides and herbicides complies with national regulations. Currently Astarta uses three groups of pesticides: original, generic pesticides produced in China and generics manufactured by other companies. Some CPPs fall in the World Health Organization Recommended Classification of Pesticides by Hazard Classes Ib (highly hazardous) and class II (moderately hazardous). The Company has agreed to develop a policy statement to commit that Astarta will avoid use of WHO Ia/Ib pesticide chemical formulations in its operations. As set forth in the ESAP, Astarta will formalize and create guidelines and procedures to ensure implementation of the policy.
Specifically, in relation to pesticide use and management, Astarta will develop and implement Integrated Pest/Disease Control Programs through the Company’s own technical team and the involvement of international and local advisers in entomology/plant pathology. Astarta will formulate integrated pest/disease management (IPM/IDM) programs fully applying the requirements of IFC PS3. The IPM/IDM Programs shall include crop management practices, insect/disease monitoring, pest/disease ecology, biological control, and other control components, and, as a last resort, pesticide chemical formulations to avoid unacceptable economical levels of pest or disease damage. If a pesticide chemical formulation is also required as part of the IPM, then this IPM component will aim to carry a less significant weight than the other components of the IPM/IDM program. Astarta will ensure compliance with the Food and Agriculture Organization’s International Code of Conduct on the Distribution and Use of Pesticides, or to other good industry practice.
PS4: Community Health, Safety and Security
Crop production, sugar manufacturing and cattle farming: Risks associated with cultivation relate mainly to spraying of crop protection products (pesticides), fertilizer application and associated risks for runoff, and the traffic of heavy vehicles and machinery. As mentioned above, the Company uses certified pesticides. Also, the Company notifies communities located close to areas in which pesticide spraying is carried out, so they can take precautions to protect, for instance, beehives. Sugar plants are located in old-established industrial zones; dairy farms are within integrated business-units, therefore these activities are low risk with respect to local communities. Astarta and state supervisory authorities regularly review and assess the health of the stock, food safety and employees’ training. Additionally, to control systematically risks to community health and safety from ingestion of drug (such as growth hormones) and pesticide residues, the Company will conduct studies to confirm that drug and pesticide residues in milk meet maximum residue limits (MRLs) for veterinary drugs and pesticide recommended by the World Health Organization (WHO) and Food and Agriculture Organization of the United Nations (FAO) and will undertake corrective actions, if needed. Response actions, should an emergency occur, are coordinated with appropriate authorities and communities by Astarta local personnel responsible for emergency response. Operations visited have evacuation plans.
Biogas facility: The biogas facility is located within a sugar mill area; the nearest residential area is 250 m from the construction site. Protective four meter earth fill has been built into the perimeter of the site to contain potential emergency releases. Hazardous materials will be kept in a specially equipped storage zone with restricted access.
Soybean crushing plant: The site for the future soybean crushing plant is located in the area of an abandoned tinned food manufacture in the industrial zone of the town of Globino and therefore community health and safety risks are unlikely.
Security Personnel: Security to Astarta’s offices and facilities is provided by a private security agency which is licensed and has staff trained according to the relevant national legal requirements. Moreover, security guards are trained to act in case of emergency and in aiding and do not carry fire arms.
