In November 2010 the Bank signed the EUR 33 million Existing Loan in favour of SC RAJA SA, the second largest Regional Operating Company (“ROC”) in Romania. The loan was designed to co-finance the Company’s EUR 192.6 million Cohesion Fund Programme and to re-finance its existing MELF loan.
In 2014, the Company approached the Bank to extend a new loan of up to EUR 10 million to co-finance EUR 47.5 million of additional EU approved investments for the extension of wastewater network in Constanta County, the modernisation of water and wastewater infrastructure in Ilfov County and implementation of additional water and sewerage connections in the Constanta-Ialomita region. The proposed New Loan will enable the Company to solidify its position as a regional operator.
The sub-project will support environmental improvements and continued regionalisation of water and wastewater services in the County of Constanta, Ialomita, Calarasi, Ilfov and Dambovita which will result in efficiency gains and the transfer of commercial and managerial skills in water and wastewater operations to less-developed regions of country.
Compliance with the European Union relevant water legislation is also envisaged. Benchmarking will be a key component of the Framework.
Additional transition impact for this sub-project will be also achieved through exploring possible involvement of potential private sector in one or more areas of the Company’s operations as a means to achieve operational efficiencies and improve the level of service to the population.
SC Raja SA Constanta has been EBRD client since 1997 and provides water and wastewater services in the County of Constanta and Ialomita as well as smaller localities of the Counties of Calarasi, Dambovita and Ilfov.
- Tranche 1 of EUR 22.5 million to co-finance the Cohesion Funds project; (signed)
- Tranche 2 of EUR 10.5 million to re-finance the MELF loan (signed)
- Tranche 3 of EUR 10 million (under preparation)
EUR 227.4 million for the entire Constanta Sub-Project.
Categorised B. The potential E&S impacts associated with the extension and rehabilitation of water distribution and wastewater networks are likely to be site-specific and can be readily identified and addressed through mitigation measures. The Project is expected to result in various community sanitary and health benefits. The due diligence for the project included an environmental and social review of the Company management systems, an audit of selected facilities; and a gap analysis of the project appraisal documents for the project prepared for the EU Cohesion Fund application to assess compliance with the EBRD PRs. The project is expected to result in increase of drinking water and wastewater connection rates. In addition to increasing coverage, the Project will also enable the Company to provide water and wastewater services in line with EU standards at accessible tariffs as well as to continue to improve the efficiency of its operations. Through the rehabilitation of the network, the Project will enable sustainable water and wastewater services delivery. The Company has in place an Integrated Management System (IMS) for both water supply and wastewater systems. The IMS is designed based on ISO 14001 (Environment), ISO 9001 (Quality), OHSAS 18001 (Health and Safety) and ISO 22000 (food safety) standards and SA 8000 (Social Accountability). A revised ESAP has been agreed with the Company including the need to implement further provisions for the management of potential worker health and safety risks as well the need to develop a resettlement framework should land acquisition and resettlement be required. The Company is implementing a monitoring programme to measure compliance with environmental and social requirements, as well as implementation of the ESAP and contractor monitoring provisions. EBRD will monitor the project through annual environmental and social reports.
The Sub-Project already benefits from overall TC under the original Framework and its extension, including:
- Analysis of the environmental and social impacts, issues and risks and a gap analysis. (€225,000, financed by the Government of Spain)
- Financial due diligence of sub-projects under the Framework extension (€166,000, to be financed from the Bank’s own resources)
- Benchmarking and Financial and Operational performance Improvement Programme (€1,007,301 financed by the EBRD Shareholder Special Fund -“SSF”)
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