Kyzylorda Water

Location:

Kazakhstan

Project number:

45725

Business sector:

Municipal and environmental infrastructure

Notice type:

Public

Environmental category:

B

Target board date:

26 Nov 2014

Status:

Disbursing

PSD disclosed:

09 Sep 2014

Translated version of this PSD: Russian

Project Description

The EBRD is considering providing a loan up to USD 10 million to the State Communal Enterprise Kyzylorda Su Zhuyesi (the “Company”), a water supply and wastewater management company in the city of Kyzylorda (the ”City”) in Kazakhstan to support the rehabilitation and upgrade of the water and wastewater system in the City.

The loan will allow to replace and modernise parts of the obsolete water supply and wastewater management infrastructure operated by the Company. This will reduce energy consumption and water losses, increase reliability and quality of provided water services, reduce maintenance and operating costs, as well as reduce the negative environmental impact.

Transition Impact

This project would deliver:

(i) Energy efficiency improvements in the operations of the Company through the modernisation of the water supply and wastewater management facilities;

(ii) Introduction of commercial water tariffs covering the full costs of service for all customer groups as part of the priority investment programme (“PIP”) agreed with the tariff regulator and the commercialisation of the Company by means of introduction of a public service contract with the City Akimat and business planning;

(iii) Contribution to modern water management business practices through the demonstration of new replicable products and processes to operate water sector utilities in Kazakhstan, including introduction of the Management Contract with the private operator;

(iv) Higher environmental standards.

Additionally, the transaction aims to increase transparency and improve business standards through the introduction of International Financial Reporting Standards (“IFRS”) and the implementation of an Environmental and Social Action Plan (“ESAP”).

The Client

State Communal Enterprise Kyzylorda Su Zhuyesi, a municipally owned water and wastewater company in the city of Kyzylorda, Kazakhstan.

EBRD Finance

A senior loan to the Company in the amount of up to USD 10 million (EUR 7.6 million equivalent).

Project Cost

USD 16.8 million (EUR 12 million equivalent) including related technical cooperation to support the Company with the project preparation and implementation.

Environmental Impact

Categorised B. The Project will provide substantial environmental and health benefits for the Company by bringing its water and wastewater systems into compliance with relevant EU standards. The Project will also improve the energy efficiency of the Company’s facilities as well as reduce its water losses.

Future adverse environmental and social impact of modernising and rehabilitating water and wastewater systems are likely to be site-specific and readily identified and addressed through adequate mitigation measures.

The Environmental and Social Due Diligence (“ESDD”) is currently underway including

(i) an analysis of the proposed components of the Project;
(ii) a review of the Company’s current operational activities and facilities, and its environmental compliance records; and
(iii) the Company’s corporate management systems and capacity to implement the Project in accordance with the Bank’s Performance Requirements.

The ESDD is also assessing labour and community Environmental Health and Safety (“EHS”) issues, the suitability of the proposed locations for any possible expansion in the water and/or wastewater networks in terms of sensitive historical areas; and potential or temporary disturbances for people during the construction phase of the Project.

Based on the findings of the due diligence an ESAP will be prepared and agreed with the Company to address identified risks and associated mitigation measures that shall be implemented by the Company. A Stakeholder Engagement Plan (“SEP”) will be also developed to identify the Company’s key stakeholders and outline the way in which the Company will disclose and consult with its stakeholders through the project planning and implementation. A Non-Technical Summary (“NTS”) will also be released to the public to inform about of

(i) the Project components and operational activities;
(ii) environmental and social benefits;
(iii) ESAP including associated risks and mitigation measures; and
(iv) Stakeholder Engagement Plan (“SEP”). PSD will be further updated upon the completion of the ESDD.

Technical Cooperation

Pre-Signing

  • TC 1: Project due diligence including the water supply and wastewater PIP and the development of a comprehensive ESAP (EUR 295,000, funded by the EU’s Framework for Technical Assistance in Kazakhstan);

Post-Signing

  • TC 2: Project Implementation Support including assistance with procurement of goods and services under the PIP and implementation of the ESAP. The estimated cost of the assignment is up to EUR 500,000, to be financed by an international donor;
  • TC 3: Corporate Development Programme to support operational and financial improvements of the Company, including introduction of a Management Contract between the City Akimat and the private operator. The estimated cost of the assignment is up to EUR 500,000, to be financed by an international donor.
 

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.