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Screening categories and rationale for classification
The construction and operation of a new particleboard production facility is
typically associated with limited direct environmental, health and safety
issues, which can be readily identified and assessed as well as efficiently
mitigated with modern technology and project design. The project is located on
a site formerly occupied by a textile factory within an industrial zone and
surrounded by other industrial properties. The distance to the closest
permanent residential area, the village of Panasivka with 264 inhabitants, is
approximately 300 m. There are no schools, protected areas, sources of
drinking water, historical sites or other sites requiring special
consideration for environmental protection in the vicinity of the site. For
the above reasons, the EBRD has classified the project B/1, requiring an
Environmental Analysis and an environmental investigation of the site.
Information reviewed during the environmental appraisal
The Environmental Analysis has been prepared on the basis of the
technical-economic assessment of the investment (TEO) and assessment of
impacts on the environment (OVOS) prepared in accordance with the requirements
of the Ukrainian law and additional information provided by Kronospan. An
assessment of the planned facility’s compliance with the Best Available
Techniques (BAT) used in European Union was undertaken by Kronospan's internal
experts.
Key environmental issues and mitigation
The information provided has shown that the Project has been structured to
meet Ukrainian environmental, health and safety (EHS) requirements and EU
environmental standards, including BAT, and that the direct environmental,
health and safety impacts during the construction and the operation of the new
particleboard plant will be limited and efficiently mitigated. The
manufacturing process will consist primarily of new equipment incorporating
some existing items having undergone refurbishment and modernisation. The key
process components will be state-of-the-art technology representing high
standards of resource and energy efficiency and incorporating environmental
protection components. Environmental protection measures have been
incorporated in the project design. Modern ventilation system will remove dust
and glue vapours directly from the emission sources ensuring good indoor air
quality and working conditions. Dust and formaldehyde emissions to the
atmosphere will be below BAT emissions standards for particleboard
manufacturing. All industrial and cooling water will be circulated in closed
loops. No industrial wastewater will be discharged and fresh water is only
used for making up the evaporation losses. Rain and storm water is collected
to sedimentation tanks on the site. Bark and other wood wastes are used as a
fuel for the plants heating and steam generation in addition to natural gas.
Noise abatement has been taken into consideration in the project design and
the plant layout. Placement of office buildings closest to the village of
Panasivka is expected to keep the noise impact within allowable limits.
Transportation to and from the plant will be carried out by both rail and
road. The project will consider the potential disturbances on Panasivka due to
noise and the volume of cargo traffic.
The particleboard products will be of classification E1, which can be safely
used without causing elevated concentrations of formaldehyde in indoor air.
Wood procurement
The plant will use up to 1 million m3 per year of round wood. A substantial
part of that will consist of low grade round wood, which have little or no
commercial value and which is currently mainly disposed of. In addition, a
much saw dust and sawmill residues as available within a feasible
transportation distance from the mill will be used to substitute the amount of
round wood needed. Kronospan will establish a wood residue collection and
recovery system based on container system and has estimated that within 4
years from the start-up of the mill up to 50% of wood raw material will
consist of wood residues from other wood processing plants. To mitigate the
adverse impact of the wood procurement and to ensure the wood is of legal and
sustainable origin, Kronospan is committed, as required by the EBRD, to adopt
and implement wood procurement procedures that are based on principles of
sustainable forestry, ensuring that:
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the wood does not originate from statutory protected forests, forest areas
included in nature conservation programmes or sites which have been notified
by the authorities to be excluded from felling;
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the origin of the wood is monitored;
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suppliers operate according to the principles of sustainable development, in
compliance with the legislation currently in force and under the supervision
of state authorities; and
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the biodiversity and the functions of the forest ecosystem are maintained in
accordance with internationally and nationally approved principles.
Most of Kronospan’s plants in Central and Eastern Europe have FSC
chain-of-custody certification and are promoting legal timber and practical
implementation of sustainable forest management among its wood suppliers.
Kronospan is committed to introducing these principles at the Ukrainian plant
and to support FSC programme in Ukraine as well as to acquire FSC
certification when certified wood on competitive market terms will be
available. Given the underdeveloped state of forest certification in Ukraine,
Kronospan has agreed to adopt and implement a step-wise “sustainable wood
procurement plan” to ensure the Company will meet the above sustainable wood
supply requirements within an acceptable timeframe.
Disclosure of information and consultation
The project has been subject of formal public disclosure and public
consultation prior to obtaining the construction permit in accordance with
Ukrainian law in 2004-2005. In the context of EBRD’s potential participation
in the project, the Company has released locally this summary describing the
relevant environmental issues associated with the project and the mitigation
measures.
Monitoring
The Company will systematically monitor and report its environmental and
health and safety impacts to ensure compliance with Ukrainian and EU
environmental standards, including BAT. The EBRD 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. The Bank’s representatives will also conduct
periodic site supervision visits when deemed appropriate.
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