Berlian Laju Tanker

completed

Environmental Review Summary (ERS)Project Name Indonesia-Berlian Laju TankerRegion AsiaSector Infrastructure Project No. 007978 April 16, 19971. This project involves the expansion of Berlian Laju Tanker’s (BLT) existing fleet of 12 tankers, by acquiring ten newbuilt tankers of 6,500-9,000 DWT each to serve both the growing domestic and regional trades in oil products, chemicals and edible oils. BLT is a subsidiary of Bina Surya Group of Indonesia. The project would considerably increase BLT’s current tonnage of 97,636 DWT to approximately 162,636 DWT. The total project cost is estimated at US$120 million, with total IFC financing up to US$45 million.2. BLT’s business is principally shipping and does not include onshore crew housing, maintenance or dry docking facilities, and BLT does not provide onshore services for storage and handling of cargo or handling and disposal of vessel wastes (e.g., oily ballast, garbage, sewage).3. This is a category B project according to IFC''s environmental review procedure because specific impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. The review of this project consisted of appraising technical and environmental information submitted by the project sponsor, IFC’s consultant - Drewry Shipping Consultants, and the technical appraisal and site review completed by IFC’s staff. The following potential environmental, health and safety impacts of the project were analyzed:· spill prevention;· liquid effluents;· hazard control;· emergency response;· fire prevention; and· maritime safety.The information provided about how these potential impacts are addressed in the development of the proposed project is summarized in the paragraphs that follow.4. Indonesia and Panama, the flag states under which BLT ships operate, are signatories to the main International Maritime Organization (IMO) conventions. Accordingly, BLT and Drewry have both confirmed that all ships in the existing BLT fleet currently comply with the SOLAS 1974&1978 (safety code), MARPOL 1973/78 (environmental protection/pollution prevention code), and the STCW 1978 regulations. These standards include treatment and disposal of domestic and industrial solid waste generated from Shipboard operations, treatment and/or disposal of domestic sewage, ballast, bilge and storage compartment waters or other effluents. In addition, BLT have confirmed that they are in possession of valid Class Certificates for all ships currently operated in their fleet. This includes certifications pertaining to, for example, such issues as: Safety Equipment, Oil Pollution Prevention, Crew Accommodation, Minimum Safe Manning Certificate, and Safety Construction Certificate.5. BLT’s insurance claims history indicates that the company has a good safety record. The company maintains a safety management committee and an emergency response team. BLT recently, in January 1997, received International Safety Management (ISM) certification. ISM is a mandatory SOLAS requirement which is slated to come into force in mid-1998. Furthermore, two of BLT’s ships are rated in the Guide for the Selection of Tankers, compiled by the Tanker Advisory Center (NY, USA). Several of BLT’s ships are regularly inspected by major oil companies (such as Mobil, Shell and Exxon), who charter BLT ships.6. BLT confirm that all new ships will be operated in a manner consistent with all applicable IMO, SOLAS, MARPOL, and STCW codes.7. 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 Indonesia requirements, and World Bank policies, and environmental, health and safety guidelines.8. IFC will monitor BLT’s ongoing compliance with World Bank policies and guidelines during the life of the project by evaluating environmental reports submitted annually to IFC by the sponsor and by conducting periodic site reviews during project supervision.L:\WPEU\LB\INDO\BLT.ERSApril 21, 1997 11:15 AM