P.T. Pramindo Ikat Nusantara

completed

November 17,1995Environmental Review Summary (ERS)Project Name Indonesia-P.T. Pramindo Ikat Nusantara (Pramindo)Region AsiaSector InfrastructureProject No. 007108 1. This project comprises the take-over of the existing 620,000 line telephone network in the Sumatra Region. The sponsor, Pramindo, will be operating the existing network and adding 520,000 new lines under the Kerjasama Operasi (KSO or joint venture) with the Indonesia’s state owned telecommunications company, P.T. Telkom. The network will be operated for a 15 year period and will involve installation of cable, microwave and radio towers, switching centers, and the upgrading and replacement of existing equipment. Total project cost is estimated at US$624 million, with IFC providing approximately US$358 million in total financing.2. 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, and the technical appraisal completed by IFC’s staff. The following potential environmental, health and safety impacts of the project were analyzed:· right-of-way (ROW) alignment;· development of previously undisturbed land;· solid and liquid wastes, including PCBs;· fire prevention and emergency response; and· general employee safety.3. The existing network in Sumatra was established as part of a wider P.T. Telkom and World Bank Telecommunications Sector Modernization project that was most recently financed in FY95. Given that the wider World Bank project utilized existing rights-of-way, and given that Pramindo’s current proposals will mainly use existing rights-of-way, impacts of network development and upgrading are expected to be limited in scope. P.T. Telkom has well established links with local authorities, and these will serve to ensure that minimal disturbance is caused during Pramindo’s network development activities.4. While the new lines will be designed, engineered and constructed under the supervision of Pramindo and France Telecom, a shareholder of Pramindo, the supply and installation of equipment will be the responsibility of various contractors. All contract agreements will have specific requirements committing contractors to comply with the relevant World Bank guidelines and policies, and local and national requirements.5. As the design of the network is to continue throughout 1996, Pramindo is not yet in a position to identify the full extent and detailed routing of the network development, however impacts on sensitive and protected areas (such as national parks) are not expected. The existing network is 90% microwave, and new installations will mostly follow existing ROW for both cable and microwave installations. For any new ROW, cable or microwave towers, (traversing or located in environmentally sensitive areas) that may be established in the future, Pramindo has committed to providing IFC with a ROW impact mitigation plan for clearance by IFC prior to implementation of the respective plan. These plans will address the following issues: what environmentally sensitive areas will be traversed (e.g., forest, mangroves, national park etc.); what the environmental impacts will be; and how these impacts will be mitigated. Pramindo have confirmed that no rainforest or other sensitive habitat will be disturbed as part of the project.6. Solid and liquid waste generated as part of construction will be disposed of in accordance with local requirements. Where feasible contractors will be required to recycle waste. Pramindo will not install any equipment containing PCBs. There are existing PCB-based transformers in the Sumatra network, however these are the property of the national electric company(PLN). PLN is solely responsible for the maintenance and operation of this equipment. In addition, CFCs or Halons will not be used in any cooling or fire fighting systems. 7. With regard to employee health and safety it is Pramindo’s intention to improve upon the services that were previously provided by P.T. Telkom. Employees will receive regular training concerning safety issues and will also be provided with appropriate safety clothing and equipment. The KSO agreement specifically requires that Pramindo allocate a specific training and education budget to encompass health services, safety, and environmental education.8. Based on its review of available information regarding potential environmental impacts and proposed mitigation measures and commitments, 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.9. IFC will monitor Pramindo’s ongoing compliance with World Bank policies and guidelines during the life of the project by evaluating monitoring reports submitted annually to IFC by the sponsor and by conducting periodic site reviews during project supervision.l:\wpeu\lb\indo\pramindo.ers