PICO Oil and Gas



Project number:


Business sector:

Natural resources

Notice type:


Environmental category:


Approval date:

28 Jan 2015



PSD disclosed:

07 Nov 2014

As permitted by paragraph 2.6 of Section III of the Access to Information Policy, disclosure of this PSD was deferred in accordance with paragraph 1.4.4 of the Directive on Access to Information.

Project Description

EBRD loan of up to USD100 million as part of a larger Reserve-Based-Lending Facility of up to USD350 million.

Transition Impact

The key sources of transition impact for the Project are as follows:

(i) More widespread private ownership through supporting the expansion of an independent and private-sector owned market player;

(ii) Setting standards for corporate governance and business conduct by raising (a) Health, Safety and Environment (HSE) standards including a programme dedicated to staff training and/or certification; (b) implementing a comprehensive Corporate Governance Action Plan; and (c) membership of the International Petroleum Industry Environmental Conservation Association ("IPIECA");

(iii) Demonstration of new replicable activities by implementing a worldwide Corporate Energy Efficiency and Associated Petroleum Gas ("APG") Flaring Reduction Policy;

(iv) Contribute to the Policy Dialogue efforts with the Egyptian authorities to discuss comprehensive measures to reduce gas flaring in Egypt.

Client Information

Cheiron Finance Limited an independent upstream oil and gas company operating in Egypt.

EBRD Finance Summary

Up to USD100 million.

Total Project Cost

Up to USD350 million.

Environmental and Social Summary

Categorised B. The proposed activities will take place within the existing developed concession areas, which have in place required production facilities and have been producing oil and gas for a number of years. To date, a number of EIA studies have been carried out by the Company to cover site preparation works, drilling works and a number of other construction and operation activities. The Company maintains reports on emissions, volumes of waste and on general environmental performance of the Project. The Company has in place a Quality, Safety, Health and Environmental (QSHE) Policy and the integrated Management System based on the requirements of ISO 14001 and OHSAS 18001 standards. These management systems are adopted by all oil and gas sector subsidiaries of the Company. While QSHE MS is generally in line with the requirements of PR1, it will need to be expanded to include a comprehensive Social Policy, Social Impact Assessment (SIA), SEP and grievance mechanism.

The ESDD identified that the main source of GHG emissions is a stationary power generators with a total emission rate of 97,722 tons of CO2 equivalent out of a total of 120,088 tons (81%). The JVs have already implemented measures to reduce GHG emissions. All fields except Zaafarana, make a large use of produced gas for power generation. Also, national EIA contain key measures to reduce emissions: optimisation of stack height based on dispersion modelling ; using gas with low or no sulphur content; conducting test measurements of emissions during various optimisation studies; routine inspection and maintenance of combustion emission sources.  For achieving further energy efficiency and improvements in GHG reduction, the Company will  develop a GHG reduction strategy whereas continuous reduction and/or optimisation of flaring process will be implemented through the implementation of best practices and new technologies. The Company will prepare an annual report on GHG gases, presenting an inventory of sources and volumes of GHG and documenting the yearly production of GHG.

Wastewater management requires some improvements and oil spill response plans need to be revised based on oil spill modelling.

Accidental discharges of insufficiently treated produced water, drilling cuttings or an accidental oil spill have the potential to migrate towards the protected areas and Important Bird Areas, which could adversely affect biodiversity. The national Environmental Impact Assessment studies only contain generic information on presence of species based on secondary data. The Company is currently in the process of selecting services of qualified consultants to conduct a biodiversity study and impacts assessment and to identify presence of habitat trigger species and for classifying any existing natural, modified or critical habitats as per PR 6.

The ESAP contains inter alia commitments  to address all items identified during project appraisal, including revising the QHSE policy to include commitments on assessing and managing social risks, labour issues, stakeholder engagement in line with IFIs requirements; nominating CRS coordinators at the operating companies level; commissioning independent biodiversity studies, impact assessment and management plans; and revising oil spill response plans. The ESAP will be an integral part of the loan agreement and the Company has in principle agreed to the ESAP and a formal confirmation is expected shortly. The Company will be required to submit annual environmental and social reports on compliance with PRS, including a detailed report on the implementation of the agreed ESAP.

Technical Cooperation and Grant Financing


Company Contact Information

+ (202) 2359-1990
+ (202) 2359-7875
7 Street 150, Maadi, Cairo, Egypt

Implementation summary

EBRD signed a USD50 million facility with PICO in June 2015. The facility was structured as a revolving reserve-based loan using the borrowing base methodology, which authorizes drawdowns up to the level of certified reserves. The facility was fully repaid in December 2019.

The Project has achieved good results on benchmarks related to private ownership, institutions that promote market functioning and efficiency, and corporate governance.

The Project also progressed in terms of promoting market functioning with improved cooperation with the Egyptian authorities in the area of sustainable energy in the oil & gas sector. This was achieved through the signing of a Memorandum of Understanding with the Egyptian Ministry of Petroleum. There has been progress on the Bank's initiative to reduce gas flaring and the completion of a TC related to improving the regulatory framework for Production Sharing Contracts ("PSCs") in Egypt.

PICO also adopted and implemented a Worldwide Corporate Energy Efficiency and Associated Petroleum Gas ("APG") Flaring Reduction Programme on all worldwide activities and achieved compliance towards certifying the ESH&S systems to ISO 14001 and OHSAS 18001 standards.

PSD last updated

25 Jan 2022

Understanding Transition

Further information regarding the EBRD’s approach to measuring transition impact is available here.

Business opportunities

For business opportunities or procurement, contact the client company.

For business opportunities with EBRD (not related to procurement) contact:

Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

For state-sector projects, visit EBRD Procurement:

Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

Specific enquiries can be made using the EBRD Enquiries form.

Environmental and Social Policy (ESP)

The ESP and the associated Performance Requirements (PRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”.  The ESP and the PRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation as well as to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about environmental and social performance of the client and the project. Proportionate to the nature and scale of a project’s environmental and social risks and impacts, the EBRD additionally requires its clients to disclose information, as appropriate, about the risks and impacts arising from projects or to undertake meaningful consultation with stakeholders and consider and respond to their feedback.

More information on the EBRD’s practices in this regard is set out in the ESP.

Integrity and Compliance

The EBRD's Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all activities of the Bank in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The Bank believes that identifying and resolving issues at the project assessment approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts, and also helps to monitor integrity risks in projects post-investment.

OCCO is also responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, both within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to compliance@ebrd.com. All matters reported will be handled by OCCO for follow-up. All reports, including anonymous ones, will be reviewed. Reports can be made in any language of the Bank or of the Bank's countries of operation. The information provided must be made in good faith.

Access to Information Policy (AIP)

The AIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations following its entry into force on 1 January 2020. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.

Specific requests for information can be made using the EBRD Enquiries form.

Independent Project Accountability Mechanism (IPAM)

If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. through the Client’s Project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).

IPAM independently reviews Project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the Mechanism is: to support dialogue between Project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or Project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.

Please visit the Independent Project Accountability Mechanism webpage to find out more about IPAM and its mandate; how to submit a Request for review; or contact IPAM  via email ipam@ebrd.com to get guidance and more information on IPAM and how to submit a request.


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