Integra

Location:

Russia

Project number:

39254

Business sector:

Natural resources

Notice type:

Private

Environmental category:

B

Approval date:

16 Dec 2008

Status:

Completed

PSD disclosed:

22 Oct 2008

Project Description

The EBRD is considering a loan to Integra Group, the leading Russian oil field services company, to refinance short-term liabilities of the company, to improve balance sheet structure and reduce cost of funding for the company; to purchase drilling, seismic and technology services equipment to enable the company to provide advanced technical solutions to its clients while at the same time improving its own energy efficiency standards.

Transition Impact

The proposed transaction will support the growth of a private, independent supplier of oil field services which offers an alternative to in-house operations to oil and gas companies. It will have a demonstration effect by introducing in Russia modern international drilling technologies and promoting sound business practices in the industry.
Through the project, the Bank will promote

(i) increased outsourcing of OFS to the private sector, as the equipment investment will allow Integra to compete with in-house services of the large Russian oil and gas companies and other international market players and

(ii) support setting higher standards of environmental and business conduct by promoting an energy conservation culture through approaching energy saving issues in a systemic way. This will include the adoption of and compliance with the Bank’s Environmental Action Plan.

The Client

Integra Group, an LSE-listed company, one of the leading Russian independent providers of oilfield services and also one of the leading manufacturers of drilling rigs with heavy lifting capacity, cementing equipment and certain specialized equipment used in the exploration, development and production of oil and gas in the Russian Federation and the CIS.

EBRD Finance

Up to USD 75 million senior loan as part of USD 300 million debt financing to be syndicated to commercial banks.

Project Cost

Up to USD 300 million.

Environmental Impact

1. Environmental classification and rationale
Screened B/1. The project has several components. Environmental, health, safety and labour issues associated with modernisation and re-equipment of manufacturing facilities can be readily identified, assessed and mitigated through an environmental analysis. Other components of the project (purchase of drilling, seismic, and cementing equipment; refinancing short-term liabilities; and core-business acquisitions) do not require an environmental analysis. An audit of the existing operations has also been required.

2. Due Diligence Outcomes and Management and Mitigation Measures
As part of the environmental due diligence three sites of Integra, namely Kostroma manufacturing plant, drilling activities in Nizhnevartovsk, and KRS in Nizhnevartovsk (well work-over activities) were audited. In addition, a corporate level environmental audit was also carried out. The audit concluded that the current operations of the Company have no significant impacts on the environment and the Company is in general in compliance with Russian regulations and EU Directives. There are a number of issues identified with regard to environmental, health and safety (EHS) management system, waste, wastewater, soil contamination and occupational health and safety. However these issues can be easily mitigated through the implementation of the agreed Environmental Action Plan.

The Environmental Analysis for future operations was also undertaken by independent consultants. The Environmental Analysis concluded that the adverse environmental impacts associated with the project are expected to be limited and not significant.

An Environmental Action Plan (EAP) has been prepared and agreed with the Company to bring it into compliance with the Russian regulations and European Directives and good international practices. The main implementation requirements for the EAP are as follows:

  • Documents needed for the EHS management system will be completed.
  • Necessary documents for environmental permits will be prepared and the permits will be obtained.
  • Temporary waste storage areas will be established and these sites will be monitored as required by the regulations.
  • Solutions for wastewater management will be developed and implemented at the Kostroma and Nizhnevartovsk sites.
  • Monitoring programmes will be put in place as necessary at all sites.
  • Occupational health and safety practices will be reviewed and improved at the Kostroma site.

3. Disclosure of Information and Consultation
Environmental information on the project will be disclosed to public in accordance with the Russian Federation law. In the context of EBRD’s participation in the project, this environmental summary will be disclosed locally at the Integra local offices and the local media as well as in English on EBRD website at www.ebrd.com.

4. Monitoring and Reporting
Integra will continue monitoring its performance in accordance with the Russian Federation regulatory requirements and the EAP agreed under the project. The Company will report to the EBRD annually on the measured environmental impacts and on the implementation of the EAP mitigation measures. The Bank will evaluate the project's compliance with the applicable environmental and social standards during the lifetime of the project by reviewing these reports. The EBRD may also conduct monitoring visits to the project when and if deemed appropriate.

Technical Cooperation

None.

Company Contact

Dmitriy Avdeev, Chief Financial Officer

E-mail: avdeev@integra.ru
Tel +7 495 9330621

 

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

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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