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EBRD support for Slovenian wastewater treatment facility brings clean water to Maribor citizens
The European Bank for Reconstruction and Development (EBRD) is providing a EUR 28.1 million loan to finance the construction of a waste-water treatment plant in Maribor, Slovenia's second-largest city. Currently, municipal waste-water from the city (with a population of 160,000) is discharged untreated into the Drava River, one of the main tributaries of the Danube. As such, the project will have a major positive impact on the environment and result in great water quality improvements for the Drava River.
The EBRD loan will be extended to Aquasystems d.o.o., a private company established by a consortium led by Suez-Lyonnaise des Eaux (SLDE) and Degrémont of France. The consortium also includes Steweag and Styrcon of Austria, and Nigrad, the waste-water municipal operator in Maribor is expected to participate. Under a Build-Operate-Transfer (BOT) contract with the city of Maribor, Aquasystems will finance, construct and operate the waste-water treatment plant for a period of 22 years. Once the BOT agreement has expired, legal ownership and operation of the plant will be transferred to the city. The municipality awarded the BOT contract in July 1998 following a full international competitive bidding process organised with assistance from the EBRD. The EBRD-supported project is the first in the municipal and environmental infrastructure sector involving a BOT-type concession in Slovenia and in central and eastern Europe as a whole.
"Slovenia, like other countries in the region, faces a major challenge in raising adequate levels of investment funds to improve municipal infrastructure and services," said Charles Frank, First Vice President at the EBRD. "The Maribor project provides an important model for private sector involvement in the financing and provision of such infrastructure."
Mr Jérôme Monod, Chairman of the Supervisory Board of Suez-Lyonnaise des Eaux, said: "The Maribor waste-water treatment plant BOT project is of critical importance for the strategy of Suez-Lyonnaise des Eaux in the municipal services sector in central and eastern Europe. With this project, we confirm our commitment to this region, where we already have a presence in Hungary and the Czech Republic. It also underscores our firm belief in the viability of BOT-type municipal infrastructure investment projects."
The deputy mayor of Maribor, Mr Joze Protner, added: "The project will help Slovenia meet European Union environmental accession requirements. Involving the private sector in the construction and operation of the new waste-water treatment plant helps the city to finance such investment without burdening the municipal budget."
The EBRD has arranged the EUR 28.1 million loan with the involvement of Bayerische Hypo und Vereinsbank AG. The EBRD loan consists of an A-loan of EUR 14.8 million for its own account and a B-loan of EUR 13.3 million syndicated to participant banks. This is the first international loan extended in the municipal sector in Slovenia on a purely private basis without sovereign or municipal guarantee.
The waste-water treatment plant will be linked with the city's sewerage system through a collector, which will be financed through a capital grant of DM 13 million (EUR 6.66 million) provided by the European Commission under its EU Phare programme.
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