Barlinek II Pellet

complete

The project involves the construction of pellet production facility in Kosivo, Western Ukraine, by Barlinek Invest, a subsidiary of Barlinek SA, Warsaw Stock Exchange listed joint stock company. The facility will also consist of softwood saw mill. The project will have a significant transition Impact derived mainly from: supporting regional expansion of a Polish company to a neighbouring country, encouraging foreign direct investments into Ukraine, skill transfer as well as demonstration effect of environmentally sound wood processing and bio-fuel industry (Pellet) in Ukraine, promotion of sustainable forest management standards and certification through market mechanisms in Ukraine. The project will also contribute to the facilitation of more efficient use of wood resources. The skill transfer will take place thanks to training programmes, innovative business processes and capital investments in modern, high-tech production machinery. Barlinek Invest is 99% subsidiary of Barlinek SA, Poland. Barlinek SA is a leading floorboard producer. The Bank will arrange EUR 9.5 million financing facility. Confidential. Environmental due diligence showed that there are no significant environmental issues associated with Barlinek’s production facilities in Poland. Since 1999 Barlinek has been implementing various environmental, health and safety improvement measures, as a result of which the facilities are currently in full compliance with all relevant Polish and EU environmental standards. The company is fully committed to structure its Ukrainian Project in line with the standards and technology being applied in Barlinek SA (Poland) and will fully meet Ukrainian and EU environmental, health and safety standards. The Kosiv saw mill and pellet plant will be located in the presently desert production shops located on adjacent pieces of land. The previous occupants of the properties were a furniture manufacturer with a saw milling line and a wooden handicraft manufacturer. Barlinek does not expect any environmental issues associated with the land or the buildings. This will be verified through environmental due diligence carried out by the Bank. Following the examination, a separate Environmental Action Plan for the new plant in Kosiv may be agreed with Barlinek. It is expected that the plant in Kosiv will introduce state of the art technology with high standards of energy and resource efficiency and has potential for demonstrating benefits of environmentally sound wood processing in Ukraine. The project provides an opportunity to further promote sustainable forest management standards and certification through market mechanisms in Ukraine. The project will also be promoting bio-fuel (pellet) manufacturing industry and markets in Ukraine. None. Barlinek SA Ul. Zagnanska 27 25-528 Kielce Poland