NOVA HUT A.S.

completed

Summary Of Project Information (SPI)Project NameCzech Republic-Nova Hut, a.s.RegionEuropeSectorProject No004996Projected Board DateJanuary 7, 1997Company NameNova Hut, a.s.Technical Partner and/or Major Shareholders Nova Hut is in the process of privatisation. The privatisation plan has been approved and is being implemented. One of the results will be partial ownership of Nova Hut spread between a large number of small shareholders.Project Cost Including proposed IFC investment Total project cost is a US$650 million. The proposed financing package consists of an IFC “A” Loan of up to US$75 million and a syndicated “B” Loan of up to US$175 million.Location of project and Description of site The Nova Hut plant is located outside the city of Ostrava-Kuncice, in the Moravia region of the Czech Republic. The investment program will be carried out entirely within Nova Hut’s existing facilities.Description of Company and Purpose of Project Nova Hut is a joint stock company incorporated in the Czech Republic and is one of the three principal steel works in the country. The purpose of the investment program is to replace two existing flat product mills producing narrow hot rolled strips by a new one million=tonne=per=year slab caster and rolling mill, which will produce wide hot rolled coils (HRC); and then to construct a continuous billet caster with a capacity of 765,000 tonnes per year. This will enable Nova Hut’s steel production to be 100% continuously cast, thus eliminating ingot casting. The second part of the investment program consists of the major modernization and upgrading of a number of production plants, in particular the coke plant, the energy plant, steel plant and rolling mills. These investments include an US$86 million component for environmental upgrades throughout the Company’s facilities. Environmental Category and Issues 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 environmental review of this project focused on the following key environmental and occupational health and safety issues: ·(i) the environmental upgrades program designed to bring the NH facilities into compliance with European Union environmental standards that are to go into effect December 31, 1998, (ii) existing contamination to soil, groundwater, and buildings and (iii) occupational health and safety practices. Based on its review of available information regarding potential environmental impacts and proposed mitigation measures, IFC concludes that the proposed project will meet the Czech government’s requirements, and World Bank policies, and environmental, health and safety guidelines. IFC will monitor ongoing compliance with World Bank policies and guidelines during the life of the project by evaluating monitoring reports submitted annually to IFC by Nova Hut and by conducting periodic site reviews during project supervision.The is available from the Public Information Center. Date SPI sent to PIC December 9, 1996For Additional Information contact: Corporate Relations Unit -telephone: (202) 473-7711facsimile: (202) 676-0365Environmental documents for this project are available at http://www.ifc.org and from the World Bank InfoShop (http://www.worldbank.org/html/pic/aboutinfo.html).