PROJECT

Projects

Environmental & Social Review Summary

Project Number

9400

Company Name

Representative of Baku Hotel Company in Azerbaijan

Date ESRS Disclosed

Feb 5, 2010

Country

Azerbaijan

Region

Europe

Last Updated Date

Jan 2, 2017

Environmental Category

B - Limited

Status

Completed

Previous Events

Approved : Jun 18, 1999
Signed : Jul 30, 1999
Invested : Apr 20, 2000

Sector

City and Business Hotel

Industry

Tourism, Retail and Property

Department

Regional Industry MAS LAC & EUR

Project Description

- 3 -

Environmental Review Summary (ERS)

Project Name: Azerbaijan: Baku Hotel Co.

Region : Central and Southern Europe

Sector: Hotels and Resorts

Project No: 009400

1. This project involves expansion of an existing hotel and office complex in Baku, Azerbaijan, through construction of a four-star Park Hyatt Hotel of 160 rooms and an office tower of 12,000 square meters of built-up space. The expansion will be sited adjacent to the existing 160-room Hyatt Regency and office tower, in operation in Baku since 1995. Baku Hotel Company, the owner of the existing Hyatt Regency hotel and office tower, is the project company and sponsor. Hyatt International EAME is the manager of the existing hotel and office tower, and will provide management and other services to the Park Hyatt. The expanded complex will include a business center, a health/sports club, and retail outlets, and will share management and services with the existing Hyatt Regency. It is estimated that the project will be completed by the end of 1999.

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 following key environmental health and safety issues were analyzed:

· temporary human settlement;
· liquid effluent treatment and disposal;
· solid waste disposal;
· power and water supply;
· CFCs;
· employee safety training and emergency response; and
· fire protection measures.

The sponsor has submitted information outlining how the key issues listed above will be addressed. This information is summarized in the paragraphs that follow.

3. Under a general order from the Government of Azerbaijan, displaced persons from the 1992-95 conflict between Armenia and Azerbaijan were temporarily resettled on vacant or unfinished building sites (including 72 displaced refugees who settled on various parcels of land which comprise the present Baku Hotel expansion site). As an act of good corporate citizenship, the Baku Hotel Company (in consultation with the municipal and national government authorities) made an outlay of around US$400,000 to purchase apartments for the 72 displaced persons, in districts of their own choosing. The Baku Hotel Company is also providing approximately 50 of the displaced persons employment as part of the construction crew for the hotel expansion. The Baku Hotel Company expects to retain a portion of this labor force for other future construction projects as well.

4. The existing buildings are currently discharging sewage and liquid wastes to the Govsani Treatment Plant (GTP), Baku Sewage Department. The GTP has a current capacity of 600,000m3/day and is not currently able to handle all of the waste flow it receives. Excess effluent (overflow) is discharged untreated to the Caspian Sea. The GTP is scheduled for expansion to start approximately in August 1999 with funding in part provided by European donors. The Baku Sewage Department has confirmed that they will have the capacity to treat the projected outflows of the existing and new hotels/office complex (Hyatt International Center) to meet local standards. However, if the GTP expansion is not substantially complete by January 2001, the Baku Hotel Company will install treatment facilities onsite.

The Company will be discharging waste from all point sources within the hotel; including sewage, grey water from kitchens and laundry to the GTP and/or treating all point source liquid effluent on site. The dry cleaning system will be a closed loop system.

5. Solid waste from all point sources will be collected and disposed of at a Government approved landfill site at Sabunchinskiy District, Balakhani Highway.

6. Water for the hotel operation will be supplied by the local water authority and will comply will be treated sand filters, softening, and chlorination. Water hardness and chlorine concentration is measured daily and bacteriological tests are carried out periodically.

7. Power is supplied by the local/national grid. Existing fuel storage tanks associated with boilers and steam generators are supplied with secondary containment structures. The Company will provide secondary containment to any new fuel storage tanks, including those associated with backup power supply (e.g., for gensets).

8. Baku Hotel Company has committed that all cold storage and central cooling systems will be CFC-free.

9. All employees will be provided with the necessary safety training in proper work procedures and equipment handling methods. Training will include emergency response preparedness.

10. Baku Hotel Company has completed an independent fire safety audit of the existing structures and of the plans for proposed new structures and have committed that the project will be designed to comply with all applicable World Bank fire safety guidelines. New structures must comply with applicable World Bank fire safety guidelines at the time of opening of these structures to the public and/or tenants. Existing structures will be retrofitted to comply with World Bank fire safety guidelines per an implementation timetable identified by the independent fire safety auditor, to be finalized by IFC and Baku Hotel Company in consultation with the auditor.

11. Based on its review of available information regarding potential environmental impacts and proposed mitigation measures, IFC concludes that the proposed project is being designed to meet Government of Azerbaijan requirements, and World Bank environmental, health and safety guidelines.

12. IFC will monitor the expansion of the GTP and Baku Hotel’s ongoing compliance with World Bank policies and guidelines during the life of the project by evaluating annual environmental performance reports submitted by Baku Hotel Company and by conducting periodic site reviews during project supervision.

Environmental and Social Mitigation Measures

Broad Community Support