1 This project involves the rehabilitation and expansion of an existing rubber estate owned by LAC, which has not been operating since the start of the civil war in Liberia. The total LAC estate covers 120,000 ha of which the company will rehabilitate the existing 10,500ha of rubber trees and expand plantation areas by an additional 2,500 ha. This is a category B project according to IFC''s environmental and social review procedure because specific impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria.

2 Key environmental, occupational health and safety issues which are of potential concern in this type of project and which were addressed during appraisal include:

· site acquisition, land tenure, existing land uses (including confirmation that local people will not be physically or economically displaced);
· confirmation that operations (including future operations) will not affect significant areas of natural habitat;
· plantation management and integrated pest management systems;
· compliance with relevant national and World Bank Group environmental and social requirements (specifically for air emissions, waste water treatment, and solid waste management);
· management of any hazardous materials (including fuel);
· occupational health and safety issues.

Appraisal of this project consisted of review of material provided by the sponsor as well as IFC technical reports. Information provided about how these issues and potential impacts have been addressed in the development of the project are summarized in the paragraphs that follow.

3 Site acquisition, land tenure and existing land uses: The LAC estate is a long established estate (1961), no new land acquisition will take place and there has been no settlement of the existing LAC plantation areas. There is no settlement within the areas identified for new rubber plantations, but there are small numbers (<100 individuals) of shifting cultivators. In its expansion plans, the company will work around areas that have been planted. There will be no physical resettlement or economic displacement. The company has met with small holders and others who have settled around the estate and discussed the proposed rehabilitation and expansion plans. There has been no objection to these plans. The remainder of the estate comprises forest and other natural and semi-natural habitat (described further below).

4 Confirmation that operations (including future operations) will not affect significant areas of natural habitat: The project will rehabilitate 10,500ha of existing rubber plantation and establish an additional 2,500 of rubber on land that has been previously cleared of forest by others and which now supports tertiary scrub re-growth. The sponsor wishes to protect the area of primary forest within the estate (25,000ha). This is currently being affected by illegal logging by others and the sponsor and IFC will look at ways in which protection and management of this resource might be achieved. Remaining parts of the estate comprise areas that have been settled by third parties as well as secondary forest and more degraded habitat.

5 Plantation management and integrated pest management systems: The only herbicide which the company will use is glyphosate and the majority of vegetation clearance will be undertaken by manual labor. Use of fungicides and limited use of insecticides (in the tree nursery) will also be necessary. All agrochemicals will be securely stored on site and staff with responsibility for application will receive training and personal protection equipment. All chemicals used will conform to WBG requirements.

6 Compliance with relevant national and World Bank Group environmental and social requirements (specifically for air emissions, wastewater treatment, and solid waste management): On site generation of power will be via 2x600KVA generators fueled by diesel oil and emissions from this source are insignificant. The project will not use CFCs and there are no significant other sources of air emissions. Water will be drawn from an adjacent river and the volume of abstraction will have no impact on downstream users and process water use will be minimized through recirculation of water within the factory. Treatment of wastewater (septic and process) will be on site and will comprise septic tanks and effluent ponds. Treated water will be applied to the rubber plantation for irrigation. Solid waste will comprise sediments from the effluent ponds which will be applied to the rubber plantation as a soil conditioner, scrap metal and plastics (which will be disposed of on site in a dedicated landfill) and chemical containers (which will be stored securely and disposed of as recommended by manufacturers).

7 There is currently no relevant environmental or health and legislation in Liberia. On the basis of information received, the sponsor will comply with relevant WBG guideline requirements.

8 Management of any hazardous materials (including fuel): Fuel will be stored underground in existing storage containers. Pesticide storage, use and disposal of used containers is addressed above and no other hazardous materials will be used.

9 Occupational health and safety issues: The company will develop and implement a formal occupational health and safety plan which complies with WBG requirements and will provide or organize appropriate training for staff.

10 IFC will monitor ongoing compliance with World Bank Group environmental, health and safety policies and guidelines during the lifetime of the project by evaluating reports submitted annually to IFC by LAC and by conducting periodic supervision. In particular, IFC will require annual reporting:

· demonstrating continuing compliance with WBG requirements;
· on the type and volumes of agrochemicals used;
· on the scale of logging that is occurring in areas of primary/good secondary forest within the estate.

11 Based on its review of available information regarding potential environmental impacts and proposed mitigation measures, IFC concludes that LAC''s proposed project will meet World Bank Group environmental, health and safety policies and guidelines and host country requirements.