EGAS Energy Efficiency project

Location:

Egypt

Project number:

48901

Business sector:

Natural resources

Notice type:

Public

Environmental category:

B

Approval date:

01 Nov 2017

Status:

Disbursing

PSD disclosed:

29 Aug 2017

Translated version of this PSD: Arabic

Project Description

The project consists of energy efficiency investments along the gas pipeline and transmission network system of the Arab Republic of Egypt. The energy efficiency investments will aim to deploy technical and feasible projects in the following areas a) waste heat recovery technologies at the sites of Amerya, Dahshour and the Western Desert Gas Complex; b) turbo-expanders technologies at natural gas pressure reduction stations; c) other resource efficiency and environmental investments including an LPG separation plant and CO2-equivalent/mercury removal from wet gas systems and d) gas metering data systems infrastructure.

In parallel to the capital expenditure investments, the Bank will be supporting the liberalisation of the Egyptian gas market and implementation of the new Gas Market Law through Technical Cooperation (TC) funding.

Project Objectives

Through the energy efficiency investments, the project will help conserve considerable amounts of currently used energy, and as such yield significant greenhouse gas emission savings in excess of 251,000 tonnes of CO2 a year.

TC support will assist Egypt in the practical implementation of the new Gas Market Law and liberalisation of the domestic gas market.

Transition Impact

The sources of Transition Impact qualities for the project consist of: (i) Green and (ii) Competitive.

Client Information

EGYPT SOVEREIGN
The loan will be provided on a sovereign basis to the Arab Republic of Egypt. The ultimate beneficiary will be GASCO, the Egyptian gas transmission system operator and a subsidiary of the Egyptian Natural Gas Holding Company (EGAS).

EBRD Finance Summary

USD 200,000,000.00
EBRD will finance up to USD 200,000,000 of which up to USD 125,000,000 will be committed for item a) mentioned above and up to USD 75,000,000 for items b) to d) mentioned above (the "Loan").

Total Project Cost

USD 250,000,000.00

Environmental and Social Summary

Categorised B (ESP 2014): Financing of the energy efficiency program including recovery of waste heat in the existing gas distribution pipeline network will have mainly positive impacts. The potential adverse Environmental & Social (E&S) impacts are site-specific and can be addressed by the
Environmental and Social Action Plan (ESAP) that has been agreed with the Client and will be partially financed using the proceeds of the Loan. EBRD will also provide support in E&S capacity building and awareness.

The ultimate Beneficiary of the Project is GASCO a Company with a good track record in terms of environmental and social compliance on previous projects, including with other International Financial Institutions (IFIs). Environmental and Social Due Diligence (ESDD) of the Project has been conducted in parallel with the Energy Efficiency Due Diligence (EEDD) by an independent consultant and has included an environmental, health and safety (EHS) audit of the three Company's gas
distribution facilities, an analysis of the potential environmental and social impacts associated with the Project and Company's activities, as well as a review of the corporate EHS management systems and practices, regulatory and permitting compliance, risk management procedures and capacities, to understand its ability to manage the potential impacts and meet the EBRD's PerformanceRequirements (PRs). This process is ongoing and therefore this Project Summary Document (PSD) will be updated when the due diligence is completed. The Energy Efficiency Due Diligence included the analysis of the energy saving options and assessment of the associated Greenhouse Gas (GHG) emissions reduction that are expected to make minimum of 251 000 t.c.e.

The major E&S issues associated with the Company's operations, other than energy efficiency, include social aspects, labour and working conditions, emergency preparedness, community impacts and safety, air emissions and waste management. Due diligence confirmed that the Company has in place generally appropriate procedures and measures to avoid and mitigate these impacts although some areas for improvement have been identified and will be implemented by the Company through the ESAP. The Company has in place an adequate certified environmental and health and safety management system compliant with international standards ISO 14001 and OHSAS 18001. The
management system is supported with a well-defined organizational structure with the necessary capabilities.

A number of the recommendations were formulated into the ESAP and include, among others: 1) improvement of the social and labour procedures to address PR2 requirements including worker grievance mechanism; 2) incorporation of the good international industry practices and EBRD requirements into the E&S documentation and procedures; 3) development of the Stakeholder Engagement Plan and information disclosure procedure; 4) additional technical and organizational measures aimed at pollution control, reduction and monitoring, water and waste management; 5) enhancement of safety culture and practices; 6) improvement of the emergency preparedness, fire
and explosion safety; 7) emission monitoring and development of a GHG inventory, 8) additional training and awareness raising on the E&S issues. Further items may be added as the due diligence progresses and if so will be included in the updated PSD.

An ESAP has been agreed with the Company and its implementation, as well overall E&S performance will be monitored by the Bank on the annual basis.

Technical Cooperation

TC funds consist of (i) EUR 1.0 million for the valuation of Egypt's natural gas transmission network, in support of independent tariff setting and third-party access (TPA) by the private sector; (ii) EUR 0.4 million for capacity building within GASCO to facilitate implementation of relevant provisions of the new Gas Market Law regarding TPA; and (iii) EUR 0.3 million for feasibility studies and environmental and social and procurement due diligence.

Company Contact Information

Eng. Mohsen Metwally, Gas Plants Operations Follow up Gen. Mgr., Gasco
mohsen_metwally@gasco.com.eg
+201005641680

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)

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Text of the PIP

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 how to submit a Request for review through our confidential online form, by email, mail or telephone. IPAM is available to discuss your concerns and answer any questions you may have about the submission or handling of Requests, which follow the Project Accountability Policy and Guidance. Requestors’ identities may be kept confidential, upon request.

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