VMTG

Location:

Moldova

Project number:

50410

Business sector:

Energy

Notice type:

Private

Environmental category:

A

Approval date:

11 Dec 2019

Status:

Disbursing

PSD disclosed:

14 Oct 2019

Translated version of this PSD: Romanian

Project Description

Provision of an equity investment in the form of a capital increase in return for a stake in Vestmoldtransgaz srl ("VMTG"), the Moldovan gas transmission company that is ultimately owned and controlled by the Romanian Transport Sistem Operator SNTGN Transgaz SA ("Transgaz"). The Bank's investment will fund the construction of the natural gas pipeline Ungheni-Chisinau in Moldova
with a length of ca. 120 km and a planned capacity of 1.5 bcm.

Project Objectives

The project is part of the EU-promoted gas connection of the transmission systems of Romania and Moldova by linking Chisinau, a major area of gas consumption in the country, to the interconnector between the eastern Romanian city of Iasi and Ungheni, a Moldovan town on the Romanian border.

This connection will enhance Moldova's energy security by diversifying its gas supply sources - a prerequisite for the country's economic development.

Transition Impact

The project targets the "resilient" and "integrated" transition qualities.

(i) Resilient: the project will enable Moldova to diversify its gas supply sources and procure gas from Romania and other European markets to enhance supply security.

(ii) Integrated: The pipeline will connect Moldova with Romania and thus with future major gas infrastructure projects such as TAP, gas sources from Central European gas hubs and potential
gas transportation from Black Sea deposits. Greater integration of European gas markets will allow competition to develop across borders, producing important economic benefits for consumers and increasing security of supply.

Client Information

SNTGN TRANSGAZ SA Romania
Transgaz was established in May 2000 as a joint stock company. It is the sole Transmission System Operator of the National Gas Transmission System in Romania. Transgaz is 58.5 per cent owned by the Romanian state with the rest of shares on free float on the Bucharest Stock Exchange.

VESTMOLDTRANSGAZ srl, R. Moldova
Founded in 2015 and privatised in 2018 VMTG owns and manages gas pipeline network and provide natural gas transport services in Moldova. It operates as a subsidiary of Eurotransgaz srl, which is fully owned by Transgaz.

EBRD Finance Summary

EUR 20,000,000.00

Total Project Cost

EUR 90,000,000.00

The balance will be financed by Eurotransgaz' equity contributions and a EUR 38 million European Investment Bank (EIB) loan.

Environmental and Social Summary

Category A (2014).  The construction of a gas transmission line of this length and diameter requires a comprehensive Environmental and Social Impact Assessment (ESIA) to ensure adequate mitigation measures are applied.  EBRD has previously approved financing for this project (with a different owner), and the ESIA and associated documents have been available in the public domain since March of 2016.  In addition to the ESIA, an Environmental and Social Action Plan (ESAP), Environmental and Social Management Plans (ESMP) and Stakeholder Engagement Plans (SEP) were developed. These plans have been updated and are released as part of the new disclosure for the project, along with the original ESIA.  These documents together make the ESIA disclosure package. 

Some of the outstanding studies that were required in the original ESAP included geotechnical survey, hydrological survey, biodiversity surveys and assessment of land ownership. Several management plans were also outstanding including soil erosion control, waste management, traffic management, worker grievance, worker code of conduct etc. These surveys have been completed and have been used to inform the development of the ESMPs. 

The Project causes no physical displacement. Land-acquisition has been undertaken according to the requirements of national legislation and a Remedial Action Plan has been developed that identifies the gaps with EBRD requirements and commits the client to implementing remedial compensation measures to address all gaps. In addition, a Stakeholder Engagement Plan, Labour Management Plan and Community Health and Safety Management have been prepared for the Project.

A consultant was retained to review the various studies that were completed since the original ESIA was disclosed, and to help develop the ESMPs.  The environmental management plans have been prepared for this project include: Soil Management and Erosion Control Plan; Waste Management Plan; Water Crossing Management Plan; Spill Prevention and Cleanup Plan; Traffic Management Plan; and, Chance Finds Procedure.  Contractors will be responsible for developing their specific management plans, to be consistent with the overarching ESMPs.  These contractor plans will be reviewed and approved by VMTG, and VMTG will monitor and verify compliance with the plans.  In addition, an independent environmental and social consultant will be retained to monitor compliance along the pipeline during construction and operation, relative to the project commitments.  EBRD will actively participate in this monitoring.

There is an Environmental and Social Impact Assessment available for this project.

Technical Cooperation

None.

Company Contact Information

Cornel Mihai (inquiries from the general public), Cora Stavarescu (inquiries from public institutions)
Ccornel.mihai@transgaz.ro; cora.stavarescu@transgaz.ro
+40269803333
http://www.transgaz.ro/ro
1 Piata C. I. Motas, City of Medias, Sibiu County, 551130, Romania

Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

Public Information Policy (PIP)

The PIP 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. Please visit the Public Information Policy page below to find out how to request a Public Sector Board Report.
Text of the PIP

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