Project number:


Business sector:


Notice type:


Environmental category:


Approval date:

14 Jul 2009



PSD disclosed:

02 Jul 2009

Project Description

The EBRD is considering providing a senior, term loan of up to $500 million to RZD for balance sheet restructuring. This will allow RZD to achieve a more efficient matching of its assets and liabilities.

Transition Impact

The Project will support on-going reform of the railway sector in Russia, based on implementation of the Government’s Strategic Development Program to 2030. The focus of the reform measures will be:
a) unbundling of freight, passenger, auxiliary, non-core services and ‘accounting separation’ of RZD’s infrastructure and operations;

b) restructuring of all remaining RZD freight operations into separate companies;

c) implementing the Public Service Obligation (PSO) in respect of passenger services;

d) establishing an effective independent regulator

In addition the Project will support development of an energy efficiency programme to reduce energy and carbon intensity of RZD operations.

The Client

OAO Russian Railways (“RZD” or the “Company”) is one of the largest transportation companies in the world and number one in the world by means of electrification of railway track. RZD is a vertically integrated company that manages infrastructure and operates freight and passenger train services. The Government of the Russian Federation retains 100% ownership of OAO Russian Railways. However stakes in significant RZD subsidiaries have been or will be privatised as part of the reform process.

EBRD Finance

Up to $500 million.

Project Cost

Up to $500 million for balance sheet restructuring.

Environmental Impact

The project has been screened B (2008).

The balance sheet restructuring has no direct adverse environmental and social impacts. The EBRD’s Environmental and Social Due Diligence has focused on assessing RZD’s corporate management systems as well as past and current performance against EBRD Performance Requirements. The investigations covered environmental and social aspects of RZD’s operations, including Human Resources management and retrenchment. An Environmental and Social Action Plan (ESAP) has been agreed in principle between RZD and EBRD outlining the measures that will be implemented to avoid, minimise or mitigate environmental, social and occupational health and safety risks, issues and impacts. This ESAP also includes monitoring requirements. RZD has agreed to implement ISO 14001 and OHSAS 18001 certifiable environmental and occupational health and safety management systems across the whole company by end of 2015. As part of the ESAP, RZD also agreed to develop retrenchment procedures for significant collective dismissals as well as to seek to mitigate the adverse effects of the redundancies on individuals and affected communities. . The implementation of the ESAP to achieve EU standards based on the application of best available techniques across RZD’s operations and assets will take until 2030. Critical areas are stationary and mobile source air emissions, hazardous waste management, and soil and groundwater clean ups. I has also been agreed in the ESAP that RZD will undertake energy efficiency audits and GHG reduction programme by end of 2011. The potential future energy efficiency improvements to be developed by RZD and EBRD could result in significant environmental benefits.

Technical Cooperation


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

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