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
