BURGAS WATER COMPANY

Location:

Bulgaria

Project number:

34951

Business sector:

Municipal and environmental infrastructure

Notice type:

Public

Environmental category:

B

Target board date:

14 Dec 2004

Status:

Repaying

PSD disclosed:

14 Oct 2004

Project Description

The proposed project provides finance to
(i) upgrade and expand Burgas regional water company’s water and wastewater infrastructure
(ii) improves the financial and operational performance of the company
(iii) and addresses the legal and regulatory reform needed to promote investment into the sector.  
The project is designed to complement significant ISPA grant investment finance

Transition Impact

  • Support for the commercialisation of the Company and for institutional improvements: Technical co-operation mobilised by the Bank will  promote the commercialisation of the Company and improve its financial and operational performance. Milestones and targets agreed with the Company will be included as covenants in the Loan Agreement.  Additional technical cooperation is planned to establish and support a Project Implementation Unit.
  • Development of Regulatory Framework and Institutional improvements through implementation of the  Government Strategy for the  Water Sector Development;  passage of new Law establishing a Water Regulator and amendment of the Water Act; and establishment of effective and independent water regulator.
  • Demonstration effect: The Operation would be the first  transaction in Bulgaria where the Bank would lend directly to a state owned regional water company without a sovereign or municipal guarantee
  • Improved financial planning and management for the City of Burgas.  In order to help the City to improve its creditworthiness a Creditworthiness Enhancement Programme is planned to assist the City in defining and managing its budget, including its capital investment plans.

The Client

Burgas is 100% state owned though the Ministry of Regional Development and Public Works. The company currently provides water and sewage services to approximately 426,000 inhabitants of 13 neighbouring municipalities, increasing to 1,200,000 in the summer.

EBRD Finance

  • Loan to the Company:  €11.0 million
  • Co-finance:  €20.3 ISPA Grant
  • Other sources; €0.9

Project Cost

The total project cost has been estimated to € 33.2 million

Environmental Impact

Screened B/1.
The project has predominately environmental objectives.  The environmental due diligence, which is currently being carried out in the frame of ISPA for this project, will assess the ability of the selected investment to bring the facilities into compliance with applicable Bulgarian and EU environmental standards.  It will also assess possible environmental liabilities associated with the current operation of drinking water and wastewater management facilities.  

Technical Cooperation

Pre-signing:
CEI has approved the following:
• Feasibility Study including financial analysis, tariff and affordability analysis:  €257,233
• Environmental Impact Assessment:  €46,210
Post-signing
TC needs are estimated to include:
  • Financial and Operational Improvement Plan (FOPIP) section 5.2) €300,000, donor to be identified
  • Establishment of Project Implementation Unit (PIU) and assistance with tendering and project procurement:  €400,000, donor funds from CIDA
  • Financial planning and budgeting training and assistance for the respective City €200,000, donor to be identified
 

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

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.