Environmental & Social Review Summary
Project Number
7418
Company Name
COMPANIAS ASOCIADAS PETROLERAS S.A.
Date ESRS Disclosed
Feb 5, 2010
Country
Argentina
Region
Latin America and the Caribbean
Last Updated Date
Dec 31, 2016
Environmental Category
B - Limited
Status
Completed
Previous Events
Approved : Jun 19, 1996
Signed : Oct 29, 1996
Invested : Feb 13, 1997
Sector
Oil and Gas Production (Includes Development)
Industry
Metals and Mining
Department
Gbl Infrastructure & Natural Resources
Project Description
- 2 - May 13, 1996
Environmental Review Summary (ERS)
Project Name Argentina-CAPSA-Diadema Field
Region Latin America
Sector Oil and Gas
Project No. 007418
1. Companias Asociades Petroleras S.A. (CAPSA) is a small, regional Argentine oil and gas producer. The project involves implementation of a secondary recovery program at the existing Diadema field, Chubut Province, southeastern Argentina, which will increase CAPSA’s production from its current level of 5,500 barrels per day (bpd) to 10,700 bpd. The project entails a drilling and workover program, the construction of a central dehydration plant and installation of a central water treatment plant. The project is already in development. IFC has been requested to provide total financing of US$60 million: US$15 million in A loan and US$5 million in C loan, both for its own account and US$40 million in B loan for the account of participant banks.
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 review of this project consisted of appraising technical and environmental information submitted by the project sponsor, and the technical appraisal and site review completed by IFC’s staff. The following potential environmental, health and safety impacts of the project were analyzed:
· potential soil and groundwater contamination from existing operations;
· management of produced water and gas;
· rehabilitation of areas impacted by SERS;
· spill prevention and control;
· H2S management; and
· worker safety.
The sponsor has presented plans to address these issues and demonstrate the proposed project will comply with applicable governmental and World Bank requirements. The information provided about how these potential impacts are addressed in the development of the project is summarized in the paragraphs that follow.
3. In November, 1993 an independent environmental consulting firm (Conint SRL) completed an environmental audit of the Diadema field. At the time of the environmental audit, the Diadema field included 907 oil wells, of which 201 were operating, producing a net crude volume of 880 m3/day and 7,250 m3/day of produced water. The field also included degassing units, dehydration units, oil/water separators, gas-powered heating units, pumps of various capacities and storage tanks ranging from 40 m3 to 10,000 m3 in size. (The field, previously owned and operated by Shell and acquired by CAPSA in 1977, had at its peak, produced 12,600 bpd.) The environmental audit identified a number of environmental issues at the existing operation, none of which were deemed to be serious. These included equipment deterioration, oil spills around storage facilities, waste pits requiring decommissioning, high H2S concentrations in the vicinity of Distrito I and the inappropriate disposal of a portion of the project’s produced water (at the time of the environmental audit, 3,000 m3/day was being reinjected while the remainder was discharged to an open stream which flowed to the Atlantic Ocean). Since the audit, CAPSA has initiated a number of programs to address these environmental areas of concern.
4. The Diadema field produces approximately 1,000,000 m3/month of gas. An additional 500,000 m3/month is purchased from local producers. This gas is used to fuel the project’s gas-powered heating units and pumps. No gas is flared at the project.
5. Significant improvement has been made in the prevention of soil and groundwater contamination. The old pits, which are not in operation, are being cleaned, allowed to dry out, backfilled and reclaimed. Improvement measures for the existing pits are being implemented. The new pits are being designed consistent with the needed capacity, thus eliminating the poorly maintained extensive area pits of the past. Emergency pits with impermeable lining are being built and the storage tanks are being provided with secondary containment to prevent the possibility of extensive contamination in case of accidental spills. A rigorous preventive maintenance and environmental program in the battery areas has being developed. CAPSA also is implementing programs for the environmentally sound storage, handling and disposal of chemical products; a pipeline preventive corrosion control program; pits and storage tanks spill and soil and groundwater contamination programs; erosion control programs; and complete oil clean-up in some of the existing pits. These programs are being implemented in accordance with the requirements of the Government of Argentina.
6. The secondary recovery techniques applied in the project allows for the re-injection of the water generated in the production process. It is anticipated, that for 1996, all water will be injected (it is estimated that at this time the volume of produced water will approach 6,000 m3/day) eliminating therefore the discharge of these effluents to an open stream and ultimately to the Atlantic Ocean as was done previously. This development will result in an accelerated program for the remediation of waste pits as several of them will no longer be required.
7. Since February, 1996, Distrito I, where H2S was a problem, has ceased to be used as a water cut station. All production from here is now pumped to the new dehydration plant in Distrito F. Hence H2S is no longer a problem in Distrito I and all fluids at the new dehydration plant will be restricted to the anaerobic environment thereby eliminating the H2S problem.
8. CAPSA has a comprehensive worker health and safety program which entails the following: worker training carried out as part of Total Productive Maintenance (TPM); monitoring of worker safety practices and an on-site Health and Safety expert as well as a physician.
9. CAPSA has an Environmental Affairs specialist. His mandate is to tailor the environmental management programs in the Diadema field with CAPSA’s economic objective and the applicable environmental requirements. This specialist is responsible for: submitting environmental impact studies for exploration activities and other new developments, monitoring reports, etc. to the State Energy Department and the Mining Department in Chubut Province; evaluating environmental risk at company facilities; controlling well abandonment; waste disposal; oil spill contingency planning; and environmental monitoring.
10. IFC will ensure ongoing compliance with World Bank environmental, health and safety policies and guidelines during the life of the project by evaluating monitoring reports submitted annually to IFC by CAPSA and by conducting periodic supervision.
11. Based on its review of available information regarding potential environmental impacts and proposed mitigation measures, IFC concludes that CAPSA is in compliance with World Bank environmental, health and safety policies and guidelines, and host country requirements and that the proposed CAPSA project is designed to meet these same policies, guidelines and requirements.
Environmental Review Summary (ERS)
Project Name Argentina-CAPSA-Diadema Field
Region Latin America
Sector Oil and Gas
Project No. 007418
1. Companias Asociades Petroleras S.A. (CAPSA) is a small, regional Argentine oil and gas producer. The project involves implementation of a secondary recovery program at the existing Diadema field, Chubut Province, southeastern Argentina, which will increase CAPSA’s production from its current level of 5,500 barrels per day (bpd) to 10,700 bpd. The project entails a drilling and workover program, the construction of a central dehydration plant and installation of a central water treatment plant. The project is already in development. IFC has been requested to provide total financing of US$60 million: US$15 million in A loan and US$5 million in C loan, both for its own account and US$40 million in B loan for the account of participant banks.
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 review of this project consisted of appraising technical and environmental information submitted by the project sponsor, and the technical appraisal and site review completed by IFC’s staff. The following potential environmental, health and safety impacts of the project were analyzed:
· potential soil and groundwater contamination from existing operations;
· management of produced water and gas;
· rehabilitation of areas impacted by SERS;
· spill prevention and control;
· H2S management; and
· worker safety.
The sponsor has presented plans to address these issues and demonstrate the proposed project will comply with applicable governmental and World Bank requirements. The information provided about how these potential impacts are addressed in the development of the project is summarized in the paragraphs that follow.
3. In November, 1993 an independent environmental consulting firm (Conint SRL) completed an environmental audit of the Diadema field. At the time of the environmental audit, the Diadema field included 907 oil wells, of which 201 were operating, producing a net crude volume of 880 m3/day and 7,250 m3/day of produced water. The field also included degassing units, dehydration units, oil/water separators, gas-powered heating units, pumps of various capacities and storage tanks ranging from 40 m3 to 10,000 m3 in size. (The field, previously owned and operated by Shell and acquired by CAPSA in 1977, had at its peak, produced 12,600 bpd.) The environmental audit identified a number of environmental issues at the existing operation, none of which were deemed to be serious. These included equipment deterioration, oil spills around storage facilities, waste pits requiring decommissioning, high H2S concentrations in the vicinity of Distrito I and the inappropriate disposal of a portion of the project’s produced water (at the time of the environmental audit, 3,000 m3/day was being reinjected while the remainder was discharged to an open stream which flowed to the Atlantic Ocean). Since the audit, CAPSA has initiated a number of programs to address these environmental areas of concern.
4. The Diadema field produces approximately 1,000,000 m3/month of gas. An additional 500,000 m3/month is purchased from local producers. This gas is used to fuel the project’s gas-powered heating units and pumps. No gas is flared at the project.
5. Significant improvement has been made in the prevention of soil and groundwater contamination. The old pits, which are not in operation, are being cleaned, allowed to dry out, backfilled and reclaimed. Improvement measures for the existing pits are being implemented. The new pits are being designed consistent with the needed capacity, thus eliminating the poorly maintained extensive area pits of the past. Emergency pits with impermeable lining are being built and the storage tanks are being provided with secondary containment to prevent the possibility of extensive contamination in case of accidental spills. A rigorous preventive maintenance and environmental program in the battery areas has being developed. CAPSA also is implementing programs for the environmentally sound storage, handling and disposal of chemical products; a pipeline preventive corrosion control program; pits and storage tanks spill and soil and groundwater contamination programs; erosion control programs; and complete oil clean-up in some of the existing pits. These programs are being implemented in accordance with the requirements of the Government of Argentina.
6. The secondary recovery techniques applied in the project allows for the re-injection of the water generated in the production process. It is anticipated, that for 1996, all water will be injected (it is estimated that at this time the volume of produced water will approach 6,000 m3/day) eliminating therefore the discharge of these effluents to an open stream and ultimately to the Atlantic Ocean as was done previously. This development will result in an accelerated program for the remediation of waste pits as several of them will no longer be required.
7. Since February, 1996, Distrito I, where H2S was a problem, has ceased to be used as a water cut station. All production from here is now pumped to the new dehydration plant in Distrito F. Hence H2S is no longer a problem in Distrito I and all fluids at the new dehydration plant will be restricted to the anaerobic environment thereby eliminating the H2S problem.
8. CAPSA has a comprehensive worker health and safety program which entails the following: worker training carried out as part of Total Productive Maintenance (TPM); monitoring of worker safety practices and an on-site Health and Safety expert as well as a physician.
9. CAPSA has an Environmental Affairs specialist. His mandate is to tailor the environmental management programs in the Diadema field with CAPSA’s economic objective and the applicable environmental requirements. This specialist is responsible for: submitting environmental impact studies for exploration activities and other new developments, monitoring reports, etc. to the State Energy Department and the Mining Department in Chubut Province; evaluating environmental risk at company facilities; controlling well abandonment; waste disposal; oil spill contingency planning; and environmental monitoring.
10. IFC will ensure ongoing compliance with World Bank environmental, health and safety policies and guidelines during the life of the project by evaluating monitoring reports submitted annually to IFC by CAPSA and by conducting periodic supervision.
11. Based on its review of available information regarding potential environmental impacts and proposed mitigation measures, IFC concludes that CAPSA is in compliance with World Bank environmental, health and safety policies and guidelines, and host country requirements and that the proposed CAPSA project is designed to meet these same policies, guidelines and requirements.
Environmental and Social Mitigation Measures
Broad Community Support
Related SII
