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2012-01-25 00:00:00
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| Country: |
Russia |
| Project number: |
42299 |
| Business sector: |
Property |
| Public/Private: |
Private |
| Environmental category: |
IEE |
| Board date: |
28 June 2011 |
| Status: |
Signed |
| PSD disclosed: |
29 Sept 2011 |
Project Description
The EBRD is considering up to USD 20 million equity investment in Arrones Ltd, a limited liability company registered in Cyprus.
The Bank’s equity proceeds will be used to finance land acquisition, infrastructure and other start-up and construction costs of low-rise housing developments in Russian regional cities.
Transition Impact
The Project transition impact will derive from the following key areas:
- The Project will deliver one of the first large-scale mass-market residential developments involving a number of regional cities and built with the use of modern construction technologies, a uniform architectural concept and integrated and well-organised commercial and social space.
- The Project will also demonstrate the use of energy efficiency technologies and practices which exceed national standards in terms of energy performance and comply with international best practice. The upgraded specifications, which include super-insulation, ground source heat pumps, LED lighting and photovoltaic panels, are comparable to the Western European best practice.
The Client
Arrones Ltd, a limited liability company registered in Cyprus. The Company is beneficiary controlled by Baring Vostok Fund IV Management Limited.
EBRD Finance
Up to USD 20 million equity investment.
Project Cost
Total project costs amount to USD 57 million.
Environmental Impact
- Screening Category
Both sub-projects in Orenburg and Obninsk were categorised “B” by European Bank for Reconstruction and Development (EBRD), which means that an environmental and social analysis was required by the Bank, in accordance with the 2008 Environmental and Social Policy and Performance Requirements. The sub-projects have some environmental and social impacts which can be readily addressed through mitigation measures and an action plan. The following sub-projects need to be categorised respectively in due course.
- Information received
Ecodolie completed an Environmental, Energy Efficiency and Social Questionnaire. The third party consultants carried out environmental & social diligence and energy efficiency performance audits on the two sub-projects (Orenburg and Obninsk) and the company itself. EBRD reviewed these questionnaires and reports. In addition, EBRD carried out technical due diligence on the two sub-projects.
- Environmental and Social Issues
Due diligence confirmed that the company has adequate corporate environmental and social risk management capacities, and the two sub-projects (Orenburg and Obninsk) have been developed in accordance with national requirements and good international practice. Both sub-projects were approved in the respective urban development planning processes and went through the associated public consultation processes. In both sub-projects, the sites are suitable for the housing development, and there are no significant environmental and social issues to prevent their further development. Environmental infrastructure provisions such as water supply, waste water management and solid waste management will be in place for the sub-projects. Occupational Health and Safety issues of the construction workers and safety of the new residents and neighbouring residents during the construction are addressed in the Environmental and Social Action Plans (ESAPs).
- Environmental or Social Opportunities
The residential housing project will be in line with the Russian government's aim to provide quality housing in regional cities. The third party energy efficiency performance assessment confirmed that the project design includes energy efficiency technologies and practices which are beyond the energy efficiency standards required in Russia. Improved levels of thermal insulation, high efficiency gas boilers and high efficiency cooling system ensure energy savings which is estimated at 77,752 MWh per year of primary energy and about 15,800 tons of CO2 emission reduction per year compared with actual minimum performance requirements once the two sub-projects (Orenburg and Obninsk with 4,500 dwelling in total) are fully finished and operational.
- Summary of Environmental and Social Action Plan (ESAP)
The ESAP for Orenburg addresses EHS management for the construction and operational periods, water supply and waste water management, migrant workers legal protection and temporary accommodations, animal burial issue, grievance mechanisms for construction workers, new residents and neighbouring residents, respectively and benefit sharing. The ESAP for Obninsk addresses EHS management for the construction, transition and operational periods, migrant workers' legal protection and temporary accommodations, benefit sharing, grievance mechanism for construction workers, new residents and neighbouring residents, respectively. A separate corporate ESAP addresses a corporate environmental and social management including a review by the Bank of each Environmental & Social Due Diligence report and monitoring procedures.
- Environmental and Social Monitoring
The Bank will monitor the Project’s environmental and social performance by reviewing an annual environmental and social report as well as site visit of the sub-projects.
Technical Cooperation
Due to strong prospects of sustainable energy opportunities, the Project has been provided with technical assistance under the Energy Performance Assessment and Corporate Policy Support Framework – funded by EBRD’s Special Shareholder Fund.
Company Contact
Pavel Golovach, CFO
Tel: 7 (495) 380 3478 ext.243
E-mail: pgolovach@ecodolie.ru
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