Astana Bus Project

Location:

Kazakhstan

Project number:

47454

Business sector:

Municipal and environmental infrastructure

Notice type:

Public

Environmental category:

B

Target board date:

28 Oct 2015

Status:

Repaying

PSD disclosed:

12 May 2015

Translated version of this PSD: Russian

Project Description

 
The EBRD is providing a senior loan of up to EUR 65 million to LLP “Astana LRT”, a municipal urban transport company.  The EBRD loan will be used to procure up to 200 modern low-floor city buses. 
 

Transition Impact

 
The transition impact for this Project is expected to stem from the following activities.
 
  1. Private sector participation: A significant number of buses is expected to be eventually operated by the private sector and selected by route tendering. This will lead to greater competition from private bus operators, which over time should result in an improvement in the performance of the municipal operator.
     
  2. Institutions, laws and policies that promote market functioning and efficiency: Use of Public Service Contracts (“PSC”) to level the playing field between public and private operators.  The use of a robust PSC structure with the future operators of the new fleet will deepen the City’s ability to provide proper regulation of the public transport sector. 

    The application of the PSC approach to all operators will allow for fairer competition between the dominate public sector company and the various private operators.  This should lead to improved service for users. 
     
  3. Setting standards for corporate governance and business conduct: The private sector operators in Astana are currently not generally run according to high corporate standards, in terms of organisation controls, accounting and management controls.  The new leasing arrangements, to be embedded within the new PSCs, will introduce a higher level of corporate governance by the private sector.

    A Corporate Development Programme including improvements in corporate governance standards and business plans may also be available under the project

The expected transition impact rating is ‘good’.

The Client

The municipal urban transport company “Astana LRT” (the “Company”), was initially established to implement the light rail transit project in Astana.  Gradually, Akimat of Astana has tasked the Company with a number of projects in the public transport sector including bus route network management, transport modelling, introduction of automated fare collection system, paid parking system, etc. 
 

EBRD Finance

A Senior loan of EUR 65 million, or equivalent in KZT, provided in two tranches for 10 years including 3 year grace period.  The loan will be backed by a project support agreement with the Akimat of Astana.
 

Project Cost

EUR 75 million.
 

Environmental and social categorisation, impact, and mitigation

The proposed project has been categorised B in accordance with the 2014 EBRD Environmental and Social (E&S) Policy, as the potential impacts are expected to be site specific and readily identifiable and addressed through mitigation measures.

The environmental and social due diligence for the project, which is ongoing with EBRD TC funds, includes an independent third party environmental and social audit to assess the Client’s management capacity and systems to manage environment, health, safety and labour issues in its operations and an analysis of the potential (future) E&S impacts and benefits. It will also assess the Client’s ability to carry out the Project in compliance with the Bank’s Performance Requirements.
 
An Environmental and Social Action Plan (ESAP) will be prepared for the project, and a Stakeholder Engagement Plan will be developed that will include a grievance mechanism. Information on environmental and social performance and a summary of the agreed Action Plan will be released to stakeholders.

This PSD will be updated when the results of due diligence are known.
 

Technical Cooperation

 
Pre-Signing
  • Technical and economic due diligence (EUR 150,000, donor funds, non-reimbursable) to include: (i) preparation of a route demand and operational analysis; (ii) a technical review of the proposed bus operations to establish the route structure, demand, revenue and operational cost projections; (iii) a preparation of technical and functional specifications of the new bus fleet to be procured; (iv) a financial and economic review of proposed investments including confirmation of cost estimates.
     
  • PSC, bus leasing and depot contract preparation (EUR 75,000, donor funds, non-reimbursable).
     
  • Environmental and social due diligence (EUR 20,000, non-reimbursable) to include an environmental and social analysis of the Project.
 
Post-Signing
  • Implementation and Tender Support (EUR 250,000, donor funds, non-reimbursable) to include the procurement of the fleet including assistance with technical acceptance of buses, spare parts, documentation and training.
     
  • Independent pre-shipment inspection of buses (EUR 100,000, donor funds, non-reimbursable).
     
  • Corporate development support (EUR 50,000, donor funds, non-reimbursable) to include: (i) review of the existing practices of private operators and assistance in improving organisation controls, accounting and management controls; (ii) bus operation and maintenance safety training and guidelines.
 

Company Contact

Mr Talgat Ardan, Chairman
LLP “Astana LRT”
34, Turan street,
Astana
Tel.: +7 7172 577103
 

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

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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

Project Complaint Mechanism (PCM)

The Project Complaint Mechanism (PCM) is the EBRD's accountability mechanism. It provides an opportunity for an independent review of complaints from individuals and organisations concerning EBRD-financed projects which are alleged to have caused, or are likely to cause, environmental and/or social harm.

Please visit the Project Complaint Mechanism page to find information about how to submit a complaint. The PCM Officer (pcm@ebrd.com) is available to answer any questions you may have regarding the submission of a complaint and criteria for registration and eligibility, in accordance with the PCM Rules of Procedure.