PROJECT

Projects

Environmental & Social Review Summary

Project Number

39155

Company Name

NIBULON Agricultural Limited Liability Company

Date ESRS Disclosed

Apr 28, 2017

Country

Ukraine

Region

Europe

Last Updated Date

Jul 21, 2017

Environmental Category

B - Limited

Status

Active

Previous Events

Approved : May 30, 2017
Signed : May 31, 2017
Invested : Jul 19, 2017

Sector

Grains and Beans

Industry

Agribusiness and Forestry

Department

Gbl Ind, Manufact, Agribus & Services

Project Description

The Project is to support organic growth of agricultural commodity trading and farming activities of Nibulon Ltd ("Nibulon" or the “Company”), a leading local trader and the largest exporter of agricultural commodities in Ukraine, and also one of the top 25 local crop producers with around 83,000 ha of land under cultivation as of January 2017.   

 

Nibulon’s principal activities include local sourcing and trading for export of grain and oil-bearing crops, providing grain storage and trans-shipment services for third parties in Ukraine, and agricultural production of grain and oil-bearing crops. Nibulon, headquartered in Mykolayiv, Ukraine, owns and operates a network of inland and riverside grain silos, a sea-port trans-shipment terminal on the Bug River near the Black Sea (with 10.5 meters’ draft), and an open-water transfer system to load Panamax ships to their full draft requirement from barges. Since the first appraisal in 2012 Nibulon has acquired a ship building facility adjacent to its main terminal and is able to manufacture its own grain barges, push/tug boats, and open-water transfer facilities.

 

IFC's financing will support one of the most dynamic locally owned agricultural companies in Ukraine by strengthening the Company's capital base and financing the Company's expansion.  IFC's financing will also support a viable economic activity and create jobs in some of the poorest frontier rural regions of Ukraine (Vinnitsa, Khmelnytskyy, Zhitomyr, Sumy, Chernihiv).

Overview of IFC's Scope of Review

IFC’s initial environmental and social review of this project was carried out in 2012 and has been verified and updated based on site visits in July 2014 and January 2017. The combined appraisals included: site visits to 1) Nibulon's headquarters and sea-port transshipment terminal in Mykolayiv on the Bug River, near the Black Sea, 2) four crop growing centers, each of 4,000 to 5,000 -ha in size, 3) an animal holding farm for cows (milk and meat production only for internal consumption), 4) two river and one inland grain terminals, and 5) Nibulon’s ship yard adjacent to its main terminal. These site visits were to evaluate and confirm the consistency of application of standard operational procedures (SOPs) set by Nibulon's corporate organization for environmental and social management throughout Nibulon's geographically diverse operations. The appraisal also included comprehensive interviews with corporate and local managers responsible for SOPs implementation, including reviews of operational data and verification against Ukraine’s local requirements and IFC Performance Standards.  IFC’s appraisal considered environmental and social management plans for the Project and gaps if any between these plans and IFC requirements. Nibulon has in this respect completed requirements from the 2012 assessment before the 2014 assessment, and further implemented additional requirements between the 2014 assessment and the 2017 assessment.  Where necessary, corrective measures, intended to close any remaining gaps within a reasonable period of time, are summarized in the paragraphs that follow in this review summary. Through implementation of these management plans the Project is expected to be designed and operated in accordance with Performance Standards objectives.

E & S Project Categorization and Applicable Standard

Environmental and Social Mitigation Measures

Stakeholder Engagement

Broad Community Support

Environmental & Social Action Plan