AEF Dargle Timber (Pty) Limited

completed

SUMMARY OF PROJECT INFORMATION (SPI)Project Name:South Africa-Dargle TimbersRegion:Sub-Saharan AfricaSector:ManufacturingProject No.:009403Projected Board:March 31, 1999Company Name:Dargle Timbers (Pty) LtdTechnical Partner and/or Major ShareholdersThe 100% shareholder is Bulwer Timber (Pty) Ltd, an economic empowerment consortium formed for the purpose of buying shares in Dargle.Project cost including proposed IFC investment:The project cost is US$1.5 million. IFC is asked to make a loan of US$600,000.Location of project and description of site:Dargle Timbers is located on a 13.4 ha site in the center of a SAFCOL plantation near Dargle, in the Midlands of KwaZulu-Natal Province, South Africa.Description of company and purpose of project:Dargle Timbers is a long established sawmill. The sponsors are buying its shares and then expanding parts of the operation, particularly the lamination plant. Dargle will continue to buy logs from SAFCOL and Department of Water Affairs and Forestry plantations in the area. The logs are sawn, kiln dried and sold to four large merchants in the Durban area.Project Development Effects:Dargle Timbers currently employs close to 100 permanent employees. After the acquisition, it is envisaged that close to 30 job opportunities will be created as a result of the planned expansion. This will have strong developmental impact in the economy given the high unemployment rate in the country. The project is located in an impoverished rural community, and further job opportunities will result in the upliftment of the community’s standard of living. The project also adds significant value to a local raw material in a sustainable way and helps make furniture exports more competitive.Environmental category and issues: This is a category B project according to IFC’s environmental review procedures. Key environmental, health and safety issues include compliance with provisions of IFC’s Operational Policy on Forestry; source(s) of timber, management, harvesting and sustainability of timber supply; fire and pest management of timber supplies; involvement of affected local communities; source of water and power supply, including fuel storage if applicable; disposal of solid and liquid wastes, including sewage; air emissions from boilers and/or other sources of power from the mill; types of glues/resins used in the laminating plant and impacts on air emissions; employee exposure to dust, heat and noise; provision of personal protective equipment and employee health and safety training; fire protection, life safety and emergency response; and general plant safety and housekeeping. IFC has reviewed environmental information supplied by Dargle Timbers, as well as the material Safety Data sheets for the resin and hardener used in the laminating process and information provided by the parastatal South African Forestry Company Ltd. (SAFCOL) and the Government of south Africa’s Department of Water Affairs and Forestry (DWAF). Details of the proposed operating procedures and mitigation measures are provided in the Environmental Review Summary (ERS) for the project.The Environmental Review Summary is available from the InfoShop.Host country location of environmental documents:IFC office, Hyde Park, JohannesburgDate SPI sent to InfoShop:December 18, 1998“This Summary of Project Information is prepared and distributed to the public in advance of consideration of the proposed transaction by the Corporation’s Board of Directors. It is provided for the purpose of enhancing the transparency of IFC''s activities and should not be construed as presuming the outcome of IFC Board consideration”.For additional Information contact: Corporate Relations Unit –Telephone: (202) 473-7711Facsimile: (202) 974-4384Environmental documents for this project are available at http://www.ifc.org and from the World Bank InfoShop (http://www.worldbank.org/html/pic/aboutinfo.html).