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The proceeds of the proposed loan are to be used for post-privatisation debt repayment; therefore, in accordance with the Bank’s Environmental Policy the project has been screened C/1, requiring an environmental audit of the production facilities as well as corporate environmental management practices. An Environmental Action Plan (EAP) is currently being finalised to allow for effective implementation and monitoring. Zlomrex will be required to implement and adhere to the EAP in all aspects and ensure that all relevant milestones included in the EAP are met in a timely manner and bring the plant into compliance with Croatian end EU environmental and worker health and safety standards over the next four years. An environmental, health and safety due diligence undertaken by an independent environmental consultant identified a number of issues which need to be addressed:
(i) Air emission control in the Electric Arc Furnace and Ladle Furnace Plant;
(ii) Waste reduction and solid waste disposal;
(iii) Slag disposal;
(iv) Health and safety training programmes;
(v) Scrap, additives, gas and lubricant oil storage.
The Environmental Action Plan (EAP) is currently being finalised to allow for effective implementation of actions addressing the above issues and monitoring. Zlomrex will be required to implement and adhere to the EAP in all aspects and ensure that all relevant milestones included in the EAP are met in a timely manner. Parallel to the environmental audit an energy efficiency audit was conducted, which identified energy efficiency related investments resulting significant reduction of energy consumption leading to decreased emissions of greenhouse gases (GHG) and other pollutants. The reduction in GHG emissions has been conservatively estimated at 13,000 tpa. The implementation of the EAP will need to be monitored closely through annual progress reports, compliance reports and project implementation reports and monitoring visits in every second year.
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