Belisce

completed

3 ENVIRONMENTAL REVIEW SUMMARY (ERS) Project Name: CROATIA: Belisce Region: Europe Sector: Timber, Pulp and Paper Project No.: 008297 February 11, 1998 1. This project involves the rehabilitation and modernization of an existingintegrated pulp and paper mill in Croatia, comprising a semi-chemical pulp processingplant, a waste paper pulp preparation plant, and packaging paper and corrugated boxboardplants. This is a category B project according to IFC’s environmental review procedurebecause specific impacts may result which can be avoided or mitigated by adhering togenerally recognized performance standards, guidelines or design criteria.2. The review of this project consisted of appraising technical and environmental information submitted by the project sponsor, and the technical appraisal and site review completed by IFC''s Technical and Environment Department staff. The following potential environmental, health and safety impacts of the project were analyzed· air emissions (including those from the pulping process, blackliquor combustion unit, and any on-site steam and electricitygenerating units burning fossil fuels);· pulp and paper mill effluent treatment and discharge;· solid waste (i.e., wastewater treatment sludge, waste paper, andbark) management and disposal;· hazardous materials storage and handling; and· workplace health and safety.The information provided about how these potential impacts are addressed in the development of the project is summarized in the paragraphs that follow3. The modernization of the plant will take place in the existing facility and there will not be any need for additional land acquisition. Therefore, there is no physical relocation nor resettlement involved in the project. There are no current plans for downsizing of the work force, and if it is required in the future it will be handled through normal attrition and retirement in cooperation with worker representatives. 4. Electricity and steam are generated on site in a gas-fired power plant. Air emissions from this facility have not yet been recently measured, but gas-fired units usually produce emissions which are well within World Bank Group guidelines. The other major source of air emissions is the black liquor (Copeland) boiler, and this is fitted with appropriate control technology (Venturi scrubber) to control emissions. Sulfur dioxide has been measured in the exhaust from the chemical (white liquor) preparation plant, and is within World Bank Group guidelines. The sponsor is carrying out further investigations on air emission quality and will address any deficiencies in air emission controls and meet the World Bank Group guidelines. Recent Croatian legislation (December, 1997) has established air emission limits which are generally more strict than those of the World Bank Group. This plant uses a neutral sulfite semi-chemical pulping process which does not produce hydrogen sulfide emissions.5. The industrial liquid effluents from the plant as well as sanitary wastes (from both plant and the nearby town) are currently treated in the company''s wastewater treatment plant before discharge to the Drava River. This plant was damaged during the war and is in the process of rehabilitation and upgrading. The investment in improvements in the pulp and paper mills will also lead to decreased wastewater flow into the treatment plant as well as improved quality resulting in improved wastewater treatment plant performance. Design specifications for this physical-chemical-biological treatment plant are well within World Bank Group limits. Cooling waters from the power plant and production plants are either recycled to the process water stream or discharged to the river. There is currently a separate, untreated wastewater discharge to the river from the chip washing facility, and this effluent stream will be redirected to the treatment plant as part of this investment. The only other minor effluent discharge is some leakage from the debarking unit near the river, but this old unit will be upgraded as part of the investment. All liquid effluents from this company will be well within World Bank Group guidelines.6. The wastewater treatment sludges generated are deposited in the municipal landfill, which is operated by an independent service company. The landfill is licensed for municipal and Industrial waste, and groundwater quality is measured in three piezometers in the vicinity. The company is also considering the use of this sludge as an additive in building materials and as a soil amendment. Sawdust and bark are briquetted and sold as fuel by a separate company in the Belisce Group, and this product has received an award as an "environmentally friendly” product. Any other domestic solid wastes generated will be appropriately disposed according to local regulations. None of the electrical equipment on site contains PCBs.7. The company has established occupational health and safety programs to comply with governmental standards and World Bank Group guidelines. Assigned personnel are in charge of overseeing all safety and environmental matters involved in the operation of the company. Fire detection and fire fighting equipment is installed, and the Belisce Group has its own professional fire department, which also provides fire fighting services for the town. The transportation, handling and storage of chemicals and other hazardous materials is carried out with due regard to safety procedures to prevent accidents and spills. Employees are trained with regard to plant safety rules, accident prevention, hazards of the workplace, spill prevention, fire safety and emergency response and use of Personnel Protective Equipment (PPE). Employees are provided with and required to use appropriate PPE when deemed necessary. Employees receive annual medical checkups. The occupational health and safety department in the company carries out regular monitoring of the workplace environment. Health and safety is clearly an important concern throughout the facility, with clear signs and safety precautions throughout, as well as exemplary housekeeping in all areas. The company has received ISO 9002 certification for its paper mills, and is considering pursuing 1S0 14000 series certification in the future.8. Belisce''s wood is supplied largely (90%) by the state forestry company, with the remaining 10% from small private contractors in Croatia and Hungary. Much of the timber is produced from thinning of existing managed forests. Croatia has a long history of active and successful management of its forests to ensure their sustainability. Belisce is increasing its use of waste paper to replace some of the forest production9. IFC will monitor Belisce''s ongoing compliance with World Bank Group policies and guidelines during the of the project by evaluating the environmental performance reports submitted annually to IFC by the sponsor, in conjunction with the annual financial report, and by conducting periodic site reviews during project supervision.10. 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 Croatia requirements, and World Bank policies, and environmental, health and safety guidelinesL:\WPEU\PNEAME\CROATIA\BELISCE.ERSFEBRUARY 11, 1998 5:29 P.M.