Isiklar

completed

-1- International Finance CorporationA Member of the World Bank GroupEnvironmental Review Summary (ERS)Project Name TURKEY: IsiklarRegion Central and Southern EuropeSector Timber, Pulp and PaperProject No. 00100631. This is a corporate investment in the Isiklar Ambalaj packaging materials group of Turkey. The group has 5 paper sack manufacturing facilities in Turkey and one in Egypt, along with an integrated pulp and paper mill and converting plant in Bulgaria (Celhart, an existing IFC client). This investment will contribute to the financial restructuring of this Isiklar group as well as providing additional financing for Celhart to enable it to complete its planned upgrade. This is a category B project according to IFC''s environmental review procedure because a limited number of specific impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria.2. Key environmental and occupational health and safety issues that were of potential concern during IFC’s environmental review of this project included: · progress on environmental and health and safety measures to be incorporated in existing investment in the Celhart plant in Stamboliyski, Bulgaria:· air, water and solid waste emissions from other plants in the Group; · implementation of a group-wide Environmental Management System; and· fire safety and worker health and safety issues in all facilities3. The following is a summary of IFC’s findings during its environmental review of this proposed investment. Primary sources of information included data provided by the project sponsor, and observations during a site visit by IFC’s Technical and Environment Department.Sack Manufacturing Plants4. The Isiklar Ambalaj converting plants in Turkey and Egypt are all similar, small manufacturing facilities, with one or more lines for converting kraft paper into multi-ply sacks, largely for the cement industry. Water-based dyes are used for printing, and starch-based glues as adhesives. The plants are usually sited in rural areas outside of major centers, but with convenient transportation access. The Turkish plants are located in Izmir, Adana, Elazig, Cumra and Bartin. The plant in Egypt is located in a new industrial estate near Cairo. The workforce varies from 28 up to 256 in the largest plant.5. Some of the Turkish plants have oil-fired heaters for space heating in winter, and all have backup diesel generators for power; however, these do not produce any significant air emissions. Secondary containment of fuel storage tanks is missing at some facilities, and the sponsor will ensure that this is examined and corrected at all plants as required. Wastewater includes small amounts of process water from washing of glue and printing equipment, along with sanitary wastes. These are generally treated in septic tank systems, with treated water used for irrigation of landscaping on the plant site. The largest plant, at Cumra, has a biological treatment plant which discharges treated effluent to an adjacent irrigation canal. This is a new treatment plant and is still being run in. It will meet World Bank Group effluent guidelines when in full operation. The Bartin plant is in the process of having a new septic system installed.6. Solid wastes include mostly paper scraps, which are sold for other uses. Organic wastes are composted. Scrap metal and discarded equipment are also recycled.7. All plants have basic fire safety measures installed, including fire extinguishers and hydrants with hoses. All plants have a small health post, with a doctor present part time. A cafeteria provides meals for workers. Transportation to and from work is also provided.8. The Izmir plant has recently received ISO 14001 certification. The remaining plants are in the process of preparing for certification, and are training staff, identifying issues and preparing procedures. Isiklar Ambalaj recognizes the need for corporate responsibility for environmental affairs, and includes environment in its value statement. The company intends that all of its facilities will achieve both ISO 9002 and ISO 14001 certification.Celhart Pulp and Paper Mill9. The Celhart mill is located in Stamboliyski, near Plovdiv, Bulgaria. This plant is a current IFC investment, and received environmental review in 1998. An Environmental Review Summary was prepared and disclosed at that time. A number of environmental and health and safety issues were identified, and an environmental action plan was prepared to address these issues and ensure that the plant would be brought into compliance with World Bank Group guidelines. Since that time, the company has proceeded with the investment but financial difficulties have slowed implementation and pulp and paper production has been limited. 10. At the time of review in 1998 it was found that air emissions from this plant were variable, and while generally acceptable did show occasional exceedance of World Bank Group guidelines for some parameters (SO2 and particulates). Plant upgrading, to include modernizing the recovery boiler and rebuilding the evaporator, was expected to address these issues and ensure that the operation would be in full compliance. Process water was treated in a large, well-operated secondary wastewater treatment plant, and wastewater issues related to lime pond runoff and adequate reduction of COD, along with minor structural upgrading of the treatment facility. Waste bark was being sent to a landfill but the company planned to install a bark boiler to handle this waste.11. In the previous review, health and safety measures throughout the facility were found to require attention and the sponsor committed to substantial upgrading to improve management and procedures, install safety equipment, and upgrade fire protection.12. Celhart has made some progress in the interim in addressing these issues. Discharge from the lime sludge pond has been eliminated, and upgrade of the wastewater treatment plant has been substantially completed. Celhart now intends to recycle its bark waste, rather than combust it, and research on composting of this waste is now being carried out by a local technological institute. Progress has been made on cleaning up waste metal around the plant, and a start has been made in improving fire safety equipment through installing fire extinguishers and hydrants. As required, a new management structure for health and safety has been established, and operating procedures are being developed. 13. This current investment will permit Celhart to resume the plant upgrading. The environmental action plan has been updated and rescheduled. Celhart has also agreed to have an independent fire and life safety audit carried out, in order to assist in their planning process and to prioritize future actions in this area. This audit will be a condition of disbursement of this loan.14. IFC will monitor ongoing compliance with World Bank Group environmental, health and safety policies and guidelines during the lifetime of the project by evaluating reports submitted annually to IFC by the sponsor and by conducting periodic supervision.15. Based on its review of available information regarding potential environmental impacts and proposed mitigation measures, IFC concludes that this proposed project will meet the World Bank Group’s environmental, health and safety policies and guidelines and host country requirements.