Penyao

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Penyao Environmental Protection Co. Ltd. (“Penyao” or the “Company”) is a leading integrated private utility operator that primarily engages in water supply (WS) and wastewater treatment (“WWT”) by owning/operating TOT (Transfer, Operate and Transfer) and BOT (Build, Operate and Transfer) assets, by providing both EPC and BT services and by sales and manufacturing of environmental protection equipment. Established in 1984, Penyao has completed over 1,300 water and WWT projects in China and is a global Top 50 BOT operators by Global Water Intelligence (“GWI”). In 2017 IFC committed a US$ 100 million equivalent A loan (“the Project”) to finance Penyao’s water treatment projects, noting that the investments could be committed and disbursed in phases.  Phase I was a RMB 410 million loan (approximately equivalent of US$ 60 million) that supported Penyao for the development of three (3) WWT projects and two (2) Bulk Water Supply (WS) projects in five (5) counties and refinance some short-term debt. The Environmental and Social Review Summary (ESRS) prepared for the Phase I (IFC project # 39729) was disclosed on Jun 16, 2017 (https://disclosures.ifc.org/project-detail/ESRS/39279/penyao). The E&S performance of activities under Phase I has been satisfactory to date.  This ESRS is being updated in June 2022 to reflect the findings of IFC’s E&S due diligence of Phase II of the project, which includes a loan for RMB 280 million (US$41.2 million). The projects listed below are those being considered for financing under Phase II: Two greenfield BOT WWT Plants in early stages of development:Chengnan wastewater treatment plant (WWTP) (10,000 m3/d), with 10km pipeline in the urban area of Yuanling county  Yuanlin project - a network of 40 small stations of Sewage Treatment Plants (STPs) to be installed in 21 settlements in Yuanlin county (total 7,925 m3/d), with a total of 132km pipeline   Two newly constructed WWTPs to be handover from the local government to Penyao for operation and maintenance (O&M) (1,480 m3/d): Guangzhuang WWTP (1,000 m3/d)  Shaojiwan (480 m3/d)    Three WWTPs under operation by the local government that will be transferred to Penyao for O&M:Chengbei WWTP (20,000 m3/d) WWTPFenghuangshan WWTP (2,000 m3/d) Taichang WWTP (850 m3/d)