IMAVERE SAWMILL EXPANSION PROJECT

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Expansion of the local private company, A.S. Imavere Saeveski, by purchasing and installing a second state-of-the-art sawmill line together with sorting lines for wet and dry saw material, a new boiler house and dry kilns for drying the sawmill production. The principal objectives of the project are to: The project will contribute to the transition process by: A.S. Imavere Saeveski (IS), a joint-stock company incorporated under the laws of Estonia, is privately owned and controls the most modern sawmill in Estonia. Corporate loan of DM 13.8 million (ECU 7 million). DM 35.8 million (ECU 18 million). This operation was screened B/1 and was the subject of a combined Environmental Audit and a focused Environmental Assessment. The consultants' report indicates that Imavere is the most modern sawmill in Estonia and the company currently complies with local and national environmental health and safety standards. Inspection visits by the relevant authorities have not indicated any significant areas of non-compliance apart from noise and vibration levels in some parts of the facility. Workers are required to wear noise protection equipment in such areas, and efforts are being made to reduce vibration levels. As part of the investment programme, the facility will operate according to EU/Nordic environmental, health and safety standards. Furthermore, the company intends to include environmental health and safety management in its attempts to comply with ISO 9001 during 1998-99. An Environmental Action Plan has been prepared to this end. The company will be required to submit to the Bank an annual environmental report on health, safety and environmental issues, indicating progress made in this initiative. The report will also provide information on wood consumption and sourcing. During the latter half of this century, Estonia's woodland has constantly increased, and today Estonia has one of the highest per capita reserves of standing forest in Europe. The annual rate of cutting is less than 1 per cent of the total woodland reserve, and it is generally accepted that the annual volume of felling could increase significantly without damaging the long-term sustainability of the resource or the country's biodiversity. The bulk of Imavere's wood supply will come from its major shareholder, Sylvester Ltd, and also from Lumiforest. The former is regarded by the Estonian Forest Board as one of its most reliable partners. The company has continuously invested in modern environmentally friendly logging equipment and operates in compliance with logging regulations. Both companies can provide the logs required for operation of Imavere at full capacity in the year 2000. None.