While all Performance Standards are applicable to this investment, IFCs environmental and social due diligence indicates that the investment will have impacts which must be managed in a manner consistent with the following Performance Standards. If IFCs investment proceeds, IFC will periodically review the the project’s ongoing compliance with the Performance Standards

PS 1 – Assessment and Management of Environmental and Social Risks and Impacts
PS 2 - Labor and working conditions
PS 3 - Resource Efficiency and Pollution Prevention
PS 4 – Community Health, Safety and Security
If IFC’s investment proceeds, IFC will periodically review the the project’s ongoing compliance with the Performance Standards

ENN has a well established EHS management system at both corporate level and subsidiary levels. The project is for LNG filling stations only. There are no manufacturing processes associated with this project. The LNG plants are not part of this project. The water and energy consumption for the proposed LNG filling stations are limited. There is no process wastewater effluent or point source emission from the LNG filling stations. However, near 400,000 tonnes of CO2-equivalent GHG is generated annually, mainly from methane fugitive emissions and electricity consumption. The safety control methods are sufficient for the LNG filling stations. As planned, there are no communities near any of the existing and proposed LNG filling stations. The typical LNG filling stations occupy small areas of between 0.3 – 0.5 ha. ENN mainly rents industrial and commercial land to build the filling stations at or adjacent to mines, inter-city bus terminals, or ports. Mitigation measures for the potential environmental and social impacts have been identified and are incorporated into an Environmental and Social Action Plan (ESAP) which is attached.

The potential adverse E&S impacts of this project are therefore few in number and limited to project sites, and may be readily mitigated. This is therefore an E&S Category B project.

IFC's appraisal considered the environmental and social management planning process and documentation for the project and gaps, if any, between these and IFCs requirements. Where necessary, corrective measures, intended to close these gaps within a reasonable period of time, are summarized in the paragraphs that follow and (if applicable) in an agreed Environmental and Social Action Plan (ESAP). Through the implementation of these measures, the project is expected to be designed and operated in accordance with Performance Standards objectives.

Corporate Environmental and Social Policy: ENN’s mission is innovation in clean energy, improving the living environment, and enhancing life quality. With this mission, ENN’s E&S policy is “Safety First, Prevention Priority, and Integrated Management for the Public and Social Benefits”. It requires the operations to follow all the E&S regulatory requirements and fulfill its “Three Zeros” targets: zero responsible accident, zero fatality and zero environmental damage.



Identification of Risks and Impacts: ENN contracts external experts to conduct risk assessments for all new projects, including gate stations for city natural gas supply, natural gas supply networks, CNG filling stations, LNG plants, and LNG filling stations according to local E&S regulations. The risk assessments include environmental risk assessments, safety risk assessments, fire prevention assessments and licensing, earthquake impact evaluations, and lightning strike risk assessments. Quantitative risk assessment is conducted as part of the safety risk assessment for each gate station and LNG plant, while qualitative risk assessment is conducted as part of the safety risk assessment for each CNG or LNG filling station. The review of current risk assessments for LNG filling stations shows that E&S performance will meet the requirements of applicable IFC performance standards and World Bank Group (WBG) EHS Guidelines upon successful implementation of the proposed mitigation plans. In line with the ESAP for this project, ENN will conduct a quantitative risk assessment for each new LNG filling station to further understand and mitigate potential operational risks. ENN is also committed to follow all the applicable environmental and social requirements of IFC’s Performance Standards for future projects.



Corporate Environmental and Social Management and Organization: ENN operations are divided into nine regions and more than 300 operational companies across 18 provinces of China. The corporate EHS department has 10 fulltime employees at its headquarters in Langfang, Hebei Province and an EHS representative in each region. The corporate EHS department reports directly to the corporate management team. Each subsidiary company has its own EHS department that reports to the company management team. The company EHS department also reports to the corporate EHS department for all technical and performance issues.



There are four levels of EHS management programs or procedures in ENN:



Level 1: EHS policy and specifications. This is a corporate level program and the corporate EHS department leads its implementations across subsidiaries.



Level 2: EHS policy handbooks. These are planned and implemented by regions/large subsidiaries and overseen by corporate EHS department.



Level 3: EHS policy procedure documents. These are also planned and implemented by regions/large subsidiaries and overseen by corporate EHS department.



Level 4: EHS performance procedures for subsidia
ry companies, which include integrated EHS management procedures for safety management, emergency response, client services, material management, project management, operational management, equipment management, etc. The corporate EHS department oversees the implementation of these procedures through management system evaluations, operational inspections, and comprehensive EHS audits.



The EHS management system for the six largest subsidiary companies in ENN are certified by external certification agencies following the EHS management requirements of PetroChina, which are comparable to the requirements of ISO 9000, ISO 14000, and OHSAS 18000. The corporate EHS department requires EHS management at other subsidiary companies to follow the same certification requirements.



Emergency Preparedness and Response: Fire hazard is the main operational risk at ENN and the corporate EHS department has developed detailed prevention and emergency response (ER) procedures. Each subsidiary company has additional ER procedures for their own operations. The corporate ER procedures consist of four categories and 89 scenarios, and each company is required to train personnel and conduct drills for all scenarios every three years. For each calendar year, each company has at least one internal ER drill and one joint ER drill with related local government agencies, the fire brigade and the hospital. A four hour ER training is required before each mock drill. Each operational unit has its own monthly ER drills.



Monitoring and Review: ENN has EHS performance monitoring procedures in place. Each subsidiary company monitors performance parameters and incidents, which are summarized and reported to the regional management team and the corporate EHS department. The corporate EHS department monitors corporate wide EHS performance through inspection and auditing procedures.



The corporate EHS department inspects EHS performance for all subsidiary companies once a year. The regional EHS management team inspects their subsidiary companies monthly. The EHS department at each company also conducts weekly inspections for its operational units. Each operational unit holds daily EHS briefings. The corrective actions from each inspection are recorded with timelines for implementation.



The corporate EHS department developed an EHS auditing protocol, which consists of 8 sections, 97 subsections, and 725 questions. The corporate EHS department organizes annual inter-region auditing for the top 30 largest subsidiary companies according to the auditing protocol. The regional management teams organize annual inter-company auditing for the remaining companies. Mitigation methods and implementation timelines are recorded after each audit.



The quarterly corporate management meeting reviews the summary reports from the corporate EHS department and the implementation of proposed mitigations from the previous summaries. In accordance with the ESAP, ENN will involve external ex
perts for auditing protocol revision and EHS auditing for large subsidiary companies.



Land Rental and Acquisition: Most of the LNG filling stations occupy areas in the range of 0.3 – 0.5 ha. A few planned LNG stations with service centers can utilize up to 2 ha. The land parcels for most of the filling stations are rented from industrial or commercial lands, such as coal mines, inter-city bus terminals, ports, etc. Approximately 10% of LNG filling stations are built on land purchased alongside highways. ENN avoids residential houses and farm land and only purchases land parcels on highway shoulder belts and highway economic corridors owned by local governments. There is no physical displacement for the land acquisition. As required in the ESAP, ENN will develop a land acquisition policy, according to local regulatory requirements and IFC Performance Standards, to ensure proper compensation for farmers in case of any economic displacement in the future. ENN will not purchase or rent industrial and commercial lands with historic groundwater or soil contamination.

Corporate Human Resources Policy and Management: ENN has a corporate human resources (“HR”) policy that specifies the terms of employment and working conditions. These include procedures related to recruitment, probation, training, performance review, promotion, insurance, salary and compensation, resignation, lay-off and termination, vacation, leave, and retirement. ENN includes HR policy training as part of new employee induction. Each employee has their own account to access to the HR policy though the E-Leaning program of the ENN intranet. The HR department also works as a grievance mechanism for employees. The HR manager is available to employees for any grievances. Furthermore, the labor union also has a function for the employee grievances. The mechanism for documentation of major grievances is through either HR or the labor union. In case of unsolved grievance by HR or union, the grievance is reported to the independent Supervisory Committee in the ENN Group, which reports only to the ENN Group Board. The Supervisory Committee has the final judgment for the employee grievance. Any employee can also report his/her grievance directly to the Committee.



Working Conditions: Under employment terms that strictly follow national labor law, workers are employed on fixed term contracts which are renewable subject to satisfactory performance and availability to work. All employees work for a standard 40-hour week, plus potential overtime. The employees are compensated on the basis of 1.5 times the base salary for any overtime during weekdays; double base salary at weekends; and 3 times base salary during holidays. The average salary levels at ENN are higher than the average of similar industries in the same region. All the employees also enjoy access to an insurance and the pension fund as required by the labor law.



Workers’ Organization: A worker’s union with elected union leaders has been established at ENN, as required by the All China Federation of Trade Unions (“ACFTU”). ENN management is committed to keeping the union independent from management and allows collective bargaining.



Non-Discrimination and Equal Opportunity: The HR policy specifies non-discrimination and equal opportunity. No procedures and/or practices have been identified as discriminatory and all hiring and promotion are merit-based. When candidates have similar qualifications, preference of hiring is given to local residents and females. Currently, 30% of ENN employees are female.



Retrenchment: Retrenchment is not expected for this project. ENN will hire approximately 5,000 – 6,000 new employees for operating the LNG filling station network. An undetermined number of workers will be hired temporarily for construction through contractors.



Protecting the Work Force: ENN complies with national law and does not hire workers below the age of 18. HR checks birth and school certificates during the hiring process. No forced labor practices are used by ENN and the compan
y will revise its contracting mechanism to forbid child/forced labors for all its contractors. As stated in the ESAP, ENN will hire external experts to conduct compliance labor auditing against the requirements of both local regulatory agencies and the IFC Performance Standards.



Occupational Health and Safety (OHS): Operational safety is highly emphasized within ENN. There are effective OHS procedures and adequate personal protection equipment for each position, and their uses strictly enforced. The personal protection equipment includes hard hats, anti-static work clothes, masks, protection gloves, and clothing for low temperature ER. OHS risks for each position are identified using job hazard analysis (JHA) procedures. The identified risks are mitigated through equipment modification and proper OHS operational procedures. ENN undertakes routine OHS training, including annual refreshers, for its employees. The employees, including all levels of managers, have to pass safety training exams to get a permit for their operator or managerial positions. There have been no fatal or serious accidents to ENN employees in the past five years. As indicated in the ESAP, the corporate EHS department will develop a program to monitor all recordable and lost time accidents. Incidents will be used to analyze OHS performance and establish mitigation measures, if needed.

Raw Material and Resource Efficiency: This project is for an LNG filling station network. There are no manufacturing processes and resource consumption is limited. The main resource consumption is water (660,000 t/y) for sanitary usage and electricity (230,000 MWh/y) for pumping, heating, air conditioning, and lighting at LNG stations. Water at each station is supplied by onsite wells or municipal supply. Electricity is supplied from the grid. ENN will select high efficiency pumps and improve pump maintenance to reduce electricity consumptions.



Corporate EHS Performance Management and Compliance: The corporate EHS department drafts the annual EHS improvement and management plan for corporate operations, which includes targets, responsible parties, budgets, and monitoring/review procedures. With the guidance of the corporate annual plan, each subsidiary company sets its own EHS performance targets with budgets. The routine EHS performance at each subsidiary company is enforced by inspections and audits. EHS issues are included in the quarterly corporate management meetings, which review current EHS performance, approve corrective actions for major issues, and evaluate implementation of previously identified corrective actions. EHS issues are also included in the monthly management meetings of each subsidiary company. At each LNG filing station, daily EHS briefings are conducted to reinforce performance.



The corporate EHS department reviews the EHS qualifications for each ENN contractor company annually. Each contractor company is required to have EHS refresher training twice per year. For each project, ENN engineers brief contractors on the EHS situation before the project starts. The contractor’s EHS performance during project implementation is also monitored by the EHS coordinators from ENN.



There are no point emission sources at LNG filing stations. Natural gas fugitive emissions occur due to the LNG filling process and ENN will install methane monitors to record real-time ambient and work-place methane levels, as part of ESAP requirements. All sanitary wastewater at LNG filling stations is treated in onsite septic tanks. There are truck cleaning services at LNG stations within service centers and as required in the ESAP, filtration treatment systems will be installed for wastewater which will be treated and monitored to ensure it meets both local regulatory standards and WBG EHS Guideline limits. Sanitary wastes are collected by municipal contractors for disposal. There are no other industrial wastes from this project.



Hazardous Materials and Operational Hazards: LNG is a hazardous material. The storage, handling, and transportation of LNG may pose dangers to employees and nearby communities. ENN has detailed procedures to handle LNG. At filling stations, all LNG is stored in tanks with double steel layers and secondary containment bunds. Tank integrity is checked annually by specialized contractors. As required by the ESAP, a ha
zard operability study (HAZOP) will be conducted for all LNG storage tanks. Personal electronics are not allowed in the LNG storage and filling areas. All LNG transportersmust be equipped with spark arrestors before entering LNG stations. All employees wear anti-static work clothes and methane censors are installed in all high risk areas and connected to the alarm system in the control room of each filling station. There is an emergency methane release system at each LNG station in case of system malfunction.



Greenhouse Gases (GHG): After the proposed 500 LNG filling stations are built and operational, the project will generate approximately 398,500 tonnes of CO2-equivalent GHG annually, mainly from methane fugitive emissions (227,500 t) during the filing processes and electricity consumption (171,000 t). ENN will improve its filling processes to reduce methane fugitive emissions by up to 25% through project implementation, which will reduce up to 50,000 tonnes of CO2-equivalent GHG annually.

Community Safety, Health and Security: There are no communities adjacent to any existing or planned LNG filling stations. The normal operations at the LNG filling stations have no impacts to the distant communities. Quantitative risk assessment will be conducted at each LNG station to ensure the impact radius will not include any residential areas. All the LNG is transported to the filling stations from LNG plants along major highways by LNG road tankers from both ENN and its contracted LNG transportation companies. All LNG road tankers are regularly inspected for safety and license renewal.



All ENN’s road tankers are equipped with a GPS positioning system. The transportation central control room has access to each tanker driver and monitors their movements. There are two certified defensive driving (DD) trainers for the ENN LNG transportation fleet. All the drivers are required to take DD training and exams twice per year to maintain their drivers permits. As part of emergency preparedness, all drivers have their own ER equipment in the trucks. ENN annually audits the safety performance of the contracted LNG transportation companies. All the contractor drivers are required to take DD training and an exam once per year to be qualified as ENN contractor drivers.



Emergency Preparedness and Response: ENN has ER plans available, and conducts routine drills for fire fighting with the related government agencies, the fire brigade, and hospitals. Communities are informed of and involved in the drills for city gas operations.



Security Personnel: ENN hires external agencies for site security. Security contractors conduct routine ID checks at the gates as well as security monitoring, they do not carry weapons. ENN has a security contractor management plan in place to ensure security personnel follow the correct procedures.

Each subsidiary company leads its own community engagement programs, which mainly include employment support for local residents, formal or informal meetings with local community representatives, support to local cultural events, support to local education initiatives, etc. Community members who have questions about ENN’s operations, can express their concerns to ENN though their community representatives. For city gas operations, ENN has a publicized customer service line and customer service representatives available for each service area.

Community engagement at the corporate level is through ENN Group’s ENN Charitable Foundation. ENN Energy has donated more than US$10 million in the past five years to the Foundation, which has been mainly used for scientific research on low-carbon technology, school buildings in poverty-stricken areas, scholarship/grants for students from disadvantaged families, education/technology training for young people, etc.

ENN will disclose this document in Chinese at Langfang City Library, located at No 238, Heping Road, Langfang, Hebei Province, China. For inquiries or concerns about the environmental and social impacts of this project please contact:

NAME：Yang Fangfang
ADDRESS： Building A，ENN Industrial Park, Xinyuan Dong Road, Langfang Economic and Technological Development Zone, Hebei, China.
Phone: +86-0316-2598890

Broad Community Support is not applicable for this project

Title	Anticipated completion Date	Status	Comments	Completion Date
Conduct the quantitative risk assessment for each LNG filling station for the future development.	06/30/2013 12:00:00 AM	Completed	Completed	09/30/2013 12:00:00 AM
Involve external experts for auditing protocol revision and EHS auditing for large subsidiary companies.	09/30/2013 12:00:00 AM	Completed	Completed	09/27/2013 12:00:00 AM
Develop a land acquisition policy according to local regulatory requirements and IFC Performance Standards.	12/31/2013 12:00:00 AM	Completed	Completed	06/28/2013 12:00:00 AM
1. Contracting external experts to conduct compliance labor auditing against requirements by both local regulatory agencies and IFC Performance Standards First external labor audit	06/30/2014 12:00:00 AM	Completed	Completed	04/16/2014 12:00:00 AM
1. Develop a program to monitor all recordable accidents and accidents with leaves. - Training for accident recording/monitoring	12/31/2013 12:00:00 AM	Completed	Completed	02/11/2014 12:00:00 AM
1. Develop a program to monitor all recordable accidents and accidents with leaves. - Calculate incidences for all recordable accidents and accidents with loss time.	12/31/2014 12:00:00 AM	Completed	Completed	02/11/2014 12:00:00 AM
Monitor methane concentrations at both work places and ambient environments.	12/31/2013 12:00:00 AM	Completed	Completed	01/06/2014 12:00:00 AM
Conduct hazard operability study (HAZOP) for all LNG storage tanks	12/31/2013 12:00:00 AM	Completed	Completed	10/09/2013 12:00:00 AM