Zeus Ceramica

completed

The project is Phase 2 of a green-field ceramic tile plant, CJSC Zeus Ceramica (“Zeus”), with a total annual production capacity of 4.3 million square meters of porcelain (ceramic granite) tiles in Slavyansk, Donetsk region. Phase I, the construction and installation of line 1 with an annual production capacity of 2.0 million square meters, was completed in March 2005. Phase II, the installation of line 2 with a capacity of 2.3 million square meters, is expected to be completed in the first quarter of 2007.Zeus is a joint venture between Emilceramica S.p.A., an Italian tile manufacturer and majority owner in Zeus, and CJSC Yuzhno-Oktiabrskie Gliny Yug (“YUG”), a Ukrainian supplier of clay and kaolin, the key raw materials in the production of ceramic tiles. YUG was started in the early 1990’s as a result of the privatization of several entities, including clay and kaolin quarries. YUG and its 50% owned joint venture CJSC Gliny Donbassa (“Donbass Clays”), which owns 5 quarries, supplies raw materials (clay and sand) as well as semi-finished products (mixes) to Zeus. YUG’s quarry will be depleted in approximately 3 years, while Donbass Clay has reserves for the next 25-50 years. Due to the interdependent structure of this project and its clay supply, both Zeus and Donbass clay operations were visited and reviewed for environmental and social performance during the appraisal.