Summary of Proposed Investment
Project Number
26506
Company Name
Green Resources Limited
Date SPI Disclosed
Apr 15, 2008
Country
Tanzania
Industry
Agribusiness and Forestry
Projected Board Date
May 20, 2008
Status
Completed
Sector
Logging
Department
Regional Industry - MAS Africa
Environmental Category
B - Limited
Previous Events
Approved : Apr 20, 2009
Signed : May 1, 2009
Invested : Mar 15, 2010
Project Description
Green Resources ASA (GRAS) is implementing an investment program over the next three years to expand and modernize its saw mill operations in Sao Hill, Tanzania, and establish additional plantations in Tanzania, Uganda and Mozambique. The program will include:
- achieving internationally recognized certifications including FSC, CDM and ISO 14001/9001;
- planting 9,000 ha of land with eucalyptus, pine, teak and indigenous trees;
- expanding its equipment for harvesting and wood transportation;
- modernizing an existing saw mill to increase efficiencies and capacity;
- retrofitting a small wood waste to energy plant at the mill, and installing a new wood waste-fired Combined Heating and Power (CHP) facility; and
- associated, miscellaneous capital expenditures.
Deforestation in Africa currently affects about 4 million hectares (ha) of land annually (55% of total global deforestation). Tanzania has lost 15% of its forest area since 1990, Uganda 25% and Mozambique 4%. The three countries lose on average a combined area of 550,000 ha per year through harvesting for firewood and charcoal, burning and conversion to low-yield grazing and agricultural uses. The impact of deforestation globally, through burning, is estimated to contribute 20% of the recent rise in CO2 in the atmosphere. In addition, rural populations in Africa spend up to 50% of their day securing firewood from these rapidly diminishing forests.
GRAS’s plantation and wood waste-to-energy projects will address the issues created by deforestation by:
- increasing the amount of trees planted every year, thereby functioning as a carbon sink,
- creating carbon offsets that will add to revenues,
- generating electricity from fuels produced by sustainably managed forests,
- providing a source of power poles for electric power distribution systems, and
- generating significant employment in rural areas for some of the poorest people in the countries where it operates. Approximately one person is employed for every plantation hectare planted. In addition, the increase in available electricity will decrease the demand for firewood, and will improve the living conditions of surrounding communities.
Sao Hill Industries Limited (SHI) and Green Resources Limited (GRL) are wholly owned by GRAS. GRL it is one of the largest afforestation companies in Africa. GRL planted 3,000 ha in 2007, expects to plant 5,000 ha in 2008 and to increase to more than 10,000 ha/year by 2011.
Modification and expansion of the Sao Hill Industries Limited sawmill will enable SHI to more fully utilize an existing government forest concession in Tanzania. This concession consists of mature pine and eucalyptus forests, which are currently licensed by the Department of Natural Resources to SHI with a sustainable harvest of 150,000 m³/year, or ¼ of the annual allowable cut of the entire Sao Hill Forest Project (SHFP), and procure currently unutilized waste and thinning from the remaining ¾ of the harvested wood from SHFP. The project will furthermore enable SHI to process wood harvested from GRL and other private forests. The SHI sawmill is the largest in East Africa, producing utility poles and construction timber respectively from eucalyptus and pine trees. Renovation activities will include consolidation and expansion of pressure treatment for utility poles and sawn lumber as well as de-bottlenecking of existing operations.
The proposed new CHP biomass-fired power plant at SHI will ensure much greater reliability of power supply both to the sawmill and to local consumers, who frequently have erratic electric supply. The plant will utilize sawmill wood waste to generate electricity and steam. The steam will be used for thermal processes such as dry kilns and a portion of the electricity generated will be used to operate the sawmill. Excess electricity is to be sold to Tanzania Electric Supply Company (Tanesco) or to local industries nearby. The size of the biomass-fired CHP plant is still under review pending a fuel study and associated preliminary engineering.
- achieving internationally recognized certifications including FSC, CDM and ISO 14001/9001;
- planting 9,000 ha of land with eucalyptus, pine, teak and indigenous trees;
- expanding its equipment for harvesting and wood transportation;
- modernizing an existing saw mill to increase efficiencies and capacity;
- retrofitting a small wood waste to energy plant at the mill, and installing a new wood waste-fired Combined Heating and Power (CHP) facility; and
- associated, miscellaneous capital expenditures.
Deforestation in Africa currently affects about 4 million hectares (ha) of land annually (55% of total global deforestation). Tanzania has lost 15% of its forest area since 1990, Uganda 25% and Mozambique 4%. The three countries lose on average a combined area of 550,000 ha per year through harvesting for firewood and charcoal, burning and conversion to low-yield grazing and agricultural uses. The impact of deforestation globally, through burning, is estimated to contribute 20% of the recent rise in CO2 in the atmosphere. In addition, rural populations in Africa spend up to 50% of their day securing firewood from these rapidly diminishing forests.
GRAS’s plantation and wood waste-to-energy projects will address the issues created by deforestation by:
- increasing the amount of trees planted every year, thereby functioning as a carbon sink,
- creating carbon offsets that will add to revenues,
- generating electricity from fuels produced by sustainably managed forests,
- providing a source of power poles for electric power distribution systems, and
- generating significant employment in rural areas for some of the poorest people in the countries where it operates. Approximately one person is employed for every plantation hectare planted. In addition, the increase in available electricity will decrease the demand for firewood, and will improve the living conditions of surrounding communities.
Sao Hill Industries Limited (SHI) and Green Resources Limited (GRL) are wholly owned by GRAS. GRL it is one of the largest afforestation companies in Africa. GRL planted 3,000 ha in 2007, expects to plant 5,000 ha in 2008 and to increase to more than 10,000 ha/year by 2011.
Modification and expansion of the Sao Hill Industries Limited sawmill will enable SHI to more fully utilize an existing government forest concession in Tanzania. This concession consists of mature pine and eucalyptus forests, which are currently licensed by the Department of Natural Resources to SHI with a sustainable harvest of 150,000 m³/year, or ¼ of the annual allowable cut of the entire Sao Hill Forest Project (SHFP), and procure currently unutilized waste and thinning from the remaining ¾ of the harvested wood from SHFP. The project will furthermore enable SHI to process wood harvested from GRL and other private forests. The SHI sawmill is the largest in East Africa, producing utility poles and construction timber respectively from eucalyptus and pine trees. Renovation activities will include consolidation and expansion of pressure treatment for utility poles and sawn lumber as well as de-bottlenecking of existing operations.
The proposed new CHP biomass-fired power plant at SHI will ensure much greater reliability of power supply both to the sawmill and to local consumers, who frequently have erratic electric supply. The plant will utilize sawmill wood waste to generate electricity and steam. The steam will be used for thermal processes such as dry kilns and a portion of the electricity generated will be used to operate the sawmill. Excess electricity is to be sold to Tanzania Electric Supply Company (Tanesco) or to local industries nearby. The size of the biomass-fired CHP plant is still under review pending a fuel study and associated preliminary engineering.
Sponsor / Cost / Location
Development Impact
Related ESRS/ERS
Contacts
For Inquiries About the Project, Contact
Mads Asprem, Managing Director
E-mail: mads@asprem.com
Telephone: +44 20 7250 1514
Mwaniki Ngibuini, Director of Industrial Operation
E-mail: mwanikingibuini@gmail.com
Telephone: +255 714 923 861
Olav Bjella, Director of Forestry Operations
Forestry and Plantation Operations
E-mail: olav.bjella@greenresources.no
Telephone: +47 900 89 247
E-mail: mads@asprem.com
Telephone: +44 20 7250 1514
Mwaniki Ngibuini, Director of Industrial Operation
E-mail: mwanikingibuini@gmail.com
Telephone: +255 714 923 861
Olav Bjella, Director of Forestry Operations
Forestry and Plantation Operations
E-mail: olav.bjella@greenresources.no
Telephone: +47 900 89 247
For Inquiries and Comments About IFC, Contact
General IFC Inquiries
IFC Corporate Relations
2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384
E Mail: Webmaster
IFC Corporate Relations
2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384
E Mail: Webmaster
Local Access of Project Documentation
Further information about GRL and SHI projects, industrial and plantations, the company and other considerations may be obtained from the following individuals.
Industrial Operations & Sao Hill Sawmill:
Mwaniki Ngibuini, Director of Industrial Operation
E-mail: mwanikingibuini@gmail.com
Telephone: +255 714 923 861
Olav Bjella, Director of Forestry Operations
Forestry and Plantation Operations
E-mail: olav.bjella@greenresources.no
Telephone: +47 900 89 247
Industrial Operations & Sao Hill Sawmill:
Mwaniki Ngibuini, Director of Industrial Operation
E-mail: mwanikingibuini@gmail.com
Telephone: +255 714 923 861
Olav Bjella, Director of Forestry Operations
Forestry and Plantation Operations
E-mail: olav.bjella@greenresources.no
Telephone: +47 900 89 247