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Nefteyugansk - Khanti Mansi Regional MSDP - YTTS
2008-07-23 00:00:00
Project name: Nefteyugansk - Khanti Mansi Regional MSDP - YTTS
Country: Russia
Project number: 37935
Business sector: Municipal and environmental infrastructure
Public/Private: Public
Environmental category: B
Board date: 25 November 2008
Status: Board approved, Pending signing
Date PSD disclosed:
Date PSD updated:
23 July 2008
Local language translation: Перевод на русский 
Date translation disclosed: 25 July 2008

Project description
and objectives:

The proposed project is a loan to two municipal services providers owned by the City of Nefteyugansk (the City), the district heating company and water supply/wastewater company, to finance their priority investment programmes to rehabilitate and upgrade the corresponding municipal infrastructure and to improve efficiency of the district heating and water supply/wastewater services in the City.

Transition impact:

The project will demonstrate the benefits of a systematic reform approach in a Russian region focused on tariff reform - introduction of a cost reflective tariff methodology with gradual elimination of cross-subsidies and improvements in the contractual relationship through the introduction of a service contract between the municipality and the utility companies. Additionally restructuring milestones will be set to improve the operational, technical and financial efficiency of the utility company, including possible improvements in corporate governance and more transparency through the introduction of IFRS financial reporting.

The client:

Two municipal services companies wholly owned by the City of Nefteyugansk: the district heating company “Yugansktransteploservis” (YTTS) and the water supply and wastewater company “Yuganskvodokanal” (YVK).

EBRD finance:

Loan to the Companies of up to RUB 550 million (equivalent to approximately EUR 15 million) secured by a guarantee from the City and with project support from the Okrug.

Total project cost:

Total project costs amount to RUB 777 million (equivalent to EUR 21 million).

Environmental impact:

Screened B/1.

An environmental, health and safety audit of the existing municipal district heating and water facilities of the City of Nefteyugansk and an environmental analysis of the potential environmental impacts of the priority investment programme (PIP) were required by the Bank and were carried out by COWI, Russia, July 2008, according to EBRD's Environmental Policy. Based on the findings and recommendations of the environmental due diligence report, an Environmental Action Plan (EAP) has been prepared and approved by the Companies, which will report annually on its implementation.

The project will have the following environmental benefits:
(i) reduction of heat losses and increase in energy savings;
(ii) reduction of water losses, improvement of drinking water quality and of wastewater collection;
(iii) improvement of the reliability and quality of the services provided by the Companies thus reducing public health hazards.

The PIP components have been structured to meet Russian and EU environmental, health and safety standards and therefore will result in improvement of the current environmental, health and safety conditions in the district heating and water supply/wastewater collection services. The analysis of potential environmental impacts has shown that these will involve minor short-term impacts, which will be mitigated through the EAP prepared by the Consultant and agreed by the Companies. The EAP will be included in the Loan Agreement and the Companies will report annually on the implementation of the EAP as well as on the Companies’ EHS conditions. The Bank will evaluate the project's compliance with the applicable environmental and social requirements during the lifetime of the project by reviewing annual environmental reports (AERs) prepared for the project covering:
(i) ongoing performance of project-specific environmental, health and safety activities;
(ii) the status of implementation of environmental mitigation and improvement measures.

The Bank’s representatives will also conduct site supervision visits when deemed appropriate.

Technical
cooperation:

All TC will be financed by the Okrug/local sources.

For consultant opportunities for projects financed by technical cooperation funds, visit procurement of consultants.

EBRD contact:

Anna Schin, Operation Leader: schina@ebrd.com

Procurement or tendering
opportunities:

Visit EBRD Procurement
Enquiries: Tel: +44 20 7338 6794; Fax: +44 20 7338 7472, Email: procurement@ebrd.com

General enquiries:

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168; Fax: +44 20 7338 7380
Email: projectenquiries@ebrd.com