Environmental and Social Due Diligence of New Capital ...

EnvironmentalandSocialDueDiligenceofNewCapitalPowerPlantPrepared by:

Integral Consult©

Email: [email protected]

A Member of

Environmental AllianceOctober, 2016

Cairo Office:2075 El Mearaj City, Ring Road,Maadi – Cairo – EgyptPhone +202 2 25204515Fax +202 2 25204514

Doha Office:6th Floor Al Mana Tower B, AlSadd, C-Ring Road, P.O Box.55781Phone: +974 4466 4203, +9744455 0483Fax +974 4466 7843

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Environmental and Social Due Diligence for New Capital Power Plant i

DUE DILIGENCE

Environmental and Social Due Diligence ofNew Capital Power Plant

Integral Consult

Cairo Office:

2075 El Mearaj City, Ring Road, Maadi – Cairo - Egypt

Phone +202 25204515 • Fax +202 25204514

Doha Office:

6th Floor Al Mana Tower B, Al Sadd, C-Ring Road, P.O Box. 55781

Phone: +974 4466 4203, +974 4455 0483

Fax +974 4466 7843

Email: [email protected]

Environmental and Social Due Diligence for New Capital Power Plant ii

Table of Contents1. Executive Summary ............................................................................................. 1

1.1 Scope and purpose of review ............................................................................. 1

1.2 Methodology ..................................................................................................... 2

1.3 Status of requested project documentation....................................................... 2

1.4 Power plant status .................................................................................................3

2. Project Description ............................................................................................. 4

2.1 Site Description ......................................................................................................4

2.2 Technical Description.............................................................................................6

2.3 Supplying Natural Gas Pipelines ............................................................................6

3. Summary of Due diligence activities .........................................................................8

3.1 Meetings ........................................................................................................... 8

3.2 Desk Review ...........................................................................................................9

3.3 Site Visits ......................................................................................................... 10

4. Power plant compliance with World Bank/IFC Performance standards................... 11

4.1 PS 1- Assessment and Management of Environmental and Social Risks andImpacts...................................................................................................................... 11

4.1.1 Policy ...................................................................................................... 11

4.1.2 Identification of risks and impacts .......................................................... 11

4.1.3 Management programs .......................................................................... 11

4.1.4 Organizational capacity and competency................................................ 12

4.1.5 Emergency preparedness and response.................................................. 12

4.1.6 Monitoring and review ........................................................................... 12

4.1.7 Stakeholder engagement ........................................................................ 13

4.2 PS 2- Labor and Working Conditions ................................................................ 13

4.2.1 Working Conditions and Management of Worker Relationship............... 13

4.2.2 Occupational health and safety management ......................................... 13

4.2.3 Grievance mechanism............................................................................. 14

4.2.4 Communication and training................................................................... 14

4.3 PS 3- Resource Efficiency and Pollution Prevention.......................................... 14

4.3.1 Waste disposal........................................................................................ 14

4.3.2 Air emissions .......................................................................................... 15

Environmental and Social Due Diligence for New Capital Power Plant iii

4.3.3 Noise emissions ...................................................................................... 16

4.3.4 Water supply .......................................................................................... 16

4.3.5 Wastewater discharge ............................................................................ 16

4.3.6 Hazardous waste management............................................................... 17

4.3.7 Energy conservation ............................................................................... 17

4.3.8 Water conservation ................................................................................ 17

4.3.9 Contaminated land ................................................................................. 17

4.4 PS 4- Community Health and Safety ....................................................................18

4.4.1 Spill control and management ................................................................ 18

4.4.2 Structural safety of project infrastructure ............................................... 18

4.4.3 Traffic safety ........................................................................................... 18

4.5 PS 5- Land Acquisition and Involuntary Resettlement ........................................19

4.5.1 Land acquisition...................................................................................... 19

4.6 PS 6- Biodiversity Conservation and Sustainable Management of Living NaturalResources .................................................................................................................. 19

4.7 PS 7- Indigenous People.......................................................................................19

4.8 PS 8- Cultural Heritage .........................................................................................20

4.9 WBG EHS Sector Guidelines for Thermal Power Plants..................................... 20

4.9.1 Mitigation of air emissions...................................................................... 20

4.9.2 Energy efficiency and GHG emissions ..................................................... 20

4.9.3 Thermal discharges................................................................................. 21

4.9.4 Solid wastes............................................................................................ 21

4.9.5 Hazardous materials and oils .................................................................. 21

4.9.6 Noise ...................................................................................................... 21

4.9.7 Occupational health and safety............................................................... 22

4.9.8 Monitoring emissions ............................................................................. 22

4.10 WBG EHS General Guidelines........................................................................... 22

4.10.1 Environmental ........................................................................................ 22

4.10.2 Occupational health and safety............................................................... 23

4.10.3 Community health and safety ................................................................. 23

4.10.4 Construction and decommissioning ........................................................ 23

4.11 Summary of the Environmental and Social Findings ......................................... 24

Environmental and Social Due Diligence for New Capital Power Plant iv

5. Power plant compliance with national regulations ................................................. 25

6. Conclusions and recommendations ........................................................................ 29

Annex (1) Approvals for NCPP........................................................................................ 30

Annex (2) Soil and Groundwater Analysis ...................................................................... 41

Annex (3) Environmental Practice Documents ............................................................... 42

Annex (4) Land Allocation Letter and handover meeting Minutes..................................60

Annex (5) Meetings and Site Visit MOM ........................................................................ 67

Environmental and Social Due Diligence for New Capital Power Plant v

List of FiguresFigure 1 The location of New Capital Power Plant............................................................ 4Figure 2 Cairo New Capital power plant layout and boundaries ....................................... 5

Environmental and Social Due Diligence for New Capital Power Plant vi

List of TablesTable 1 Summary of the reviewed documents ................................................................. 2Table 2 Coordinates of the power plant’s land................................................................. 5Table 3 Comparison of air emissions between turbine design and WB limits ................. 20Table 4 Summary of the Environmental and Social findings ........................................... 24Table 5 EEAA approval compliance status...................................................................... 25Table 6 Recommended Corrective Action Plan .............................................................. 29

Environmental and Social Due Diligence for New Capital Power Plant vii

List of AbbreviationsCEPC Cairo Electricity Production CompanyCTG Combustion Turbine GeneratorDA Degraded Air shedEEAA Egyptian Environmental Affairs AgencyEEHC Egyptian Electricity Holding CompanyEHS Environmental Health and SafetyEIA Environmental Impact AssessmentEMS Environmental Management StaffESAP Environmental Social Action PlanESIA Environmental and Social Impact AssessmentESMS Environmental and Social Management SystemHRSG Heat Recovery Steam GeneratorIFC International Finance CooperationLRAP Livelihood Restoration Action PlanLFO Light Fuel OilMHPUNC Minister of Housing, Public Utilities & New CommunitiesMOM Minutes of MeetingMWe Mega Watt electricalNCPP New Capital Power PlantNDA Non-Degraded Air shedOHTL Over Head Transmission LineOP Operational PolicyPS Performance StandardPMU Project Management UnitWB World BankWBG World Bank GuidelinesCO Carbon MonoxideNO2 Nitrogen Dioxide

Environmental and Social Due Diligence for New Capital Power Plant 1

1. EXECUTIVE SUMMARY

1.1 Scope and purpose of review

The Egyptian government is currently increasing the power generation capacity in thecountry. Therefore, a new power plant is constructed at New Capital. This power plant iswithin an agreement between Egyptian Electricity Holding Company (EEHC) and SiemensAG to construct and operate three combined cycle power plants of 4,800 MW each atBeni Suef, El Burullus and New Capital.

Cairo Electricity Production Company (CEPC), a company affiliated to EEHC proposed tolocate New Capital Power Plant (NCPP) at a selected site at the north of the Cairo / AinSokhna Freeway at a distance of around 50 Km from Cairo and 60 Km from Ain Sokhna.Currently, the nearest residential area to the power plant is Madinaty Compound at adistance of around 20 Km. However, other residential compounds are planned to beconstructed at distances varying from 5-15 Km. The site is within an existing piece ofland allocated to the CEPC by the Cabinet of Ministers according to decree 60/09/15/19issued during the meeting on 10/9/2015, after the approval of the Armed forces.

The NCPP will utilize natural gas as its primary fuel to generate 4,800 MW by a combinedcycle mode. The construction activities of the power plant started in July 2015. Thepower plant is intended to be partially operational in open cycle mode by the middle of2017 and fully operational in Combined Cycle mode by mid-2018.

One of the other projects implemented to support the generation of electricity in Egyptis the EG-Giza North Power Project, which was financed by the World Bank. After thecompletion of the procurement of all the packages financed by the World Bank, therewere financial savings available as part of the project to be utilized by the Governmentof Egypt. The World Bank received formal requests from the government of Egypt toutilize the financial savings of Giza North Power Plant project to procure natural gaspipelines in order to upgrade the natural gas network. One of these pipelines is Sumidimport gas pipeline, which will feed NCPP. One of the World Bank requirements is toundertake an environmental and social due diligence to any associated facility to a bank-assisted project to ensure that they are conforming to the World Bank/IFC PerformanceStandards. NCPP is considered as an associated facility to Sumid import gas pipelineproject since it meets the following World Bank criteria for the identification of theassociated facilities.

Directly and significantly related to the Bank-assisted project (Sumid import gaspipeline project)


Necessary to achieve the objectives of the Sumid import gas pipeline as set forthin the project documents; and

Carried out contemporaneously with the Sumid import gas pipeline project

This report was undertaken to check and identify the current and cumulativeenvironmental and social impacts of the power plant. Moreover, it is required to ensurethat the proposed/implemented environmental and social mitigation measures,including monitoring and reporting requirements are satisfactorily conforming to WorldBank/IFC Performance Standards (taking into consideration that the project is financedthrough KfW IPEX-Bank GmbH which is a commercial bank). Accordingly, correctivemeasures are proposed when required.

1.2 Methodology

In order to achieve the due diligence objectives, the work methodology followedincluded conducting meetings with the relevant entities to gather the available data anddocuments related to the power plant, conducting desk review for the relevant projectdocuments, in addition to conducting a visit to the power plant site. The desk review wasdone to evaluate all the gathered documents and studies prepared for the power plant.On the other hand, a site visit to the power plant was conducted on June, 16th 2016 tocheck and assess the environmental and social conditions during the construction phase.

1.3 Status of requested project documentation

The following table summarizes the documents reviewed by due diligence consultant.

Table 1 Summary of the reviewed documents

Source Reviewed DocumentEEHC 1. ESIA of the power plant

- ESIA main document- QRA volume

2. EEAA approval for the power plant3. Cabinet of Ministers’ land allocation Decree4. August 2016 updated Environmental and Social

Action Plan (ESAP)5. Soil and Ground water Investigation report6. Coordination minutes of meeting with the Ministry

of Housing and Utilities regarding the waterconnections

7. Occupational Health Management PlanSite visit 1. Waste Management Plan by Orascom (the main

contractor)2. Water and Wastewater Management plan by


Orascom3. Land handover meeting minutes between the

Ministry of Defence and EEHC4. Waste disposal log5. Waste oil disposal receipts6. Hazardous waste disposal receipts7. Traffic management plan by Orascom8. Environmental and social action plan (ESAP)

(Updated July 2016)9. Environmental and social sustainability policy10. Air and noise reports done in January

1.4 Power plant status

Based on the conducted assessment of the power plant, the due diligence teamconcluded that NCPP is considered to be in compliance to World Bank/IFC PerformanceStandards. None of the comments found throughout the study may pose anyenvironmental or social threats on the successful construction and operation of thepower plant. However, the following recommendations need to be considered:

- Adding dust as a parameter to the air quality reports during the constructionactivities.

- Specifying the exact landfills that the project will dispose its hazardous and non-hazardous wastes during operation phase and finalizing the contractualagreements with them.


2. PROJECT DESCRIPTION

2.1 Site Description

Cairo Electricity Production Company (CEPC) proposed to locate New Capital Power Plant(NCPP) at selected site at the north of the Cairo / Ain Sokhna Freeway. The distance fromthe location of the power plant to Cairo and Ain Sokhna is approximately 50 and 60 Km,respectively. Currently, the nearest residential area to the power plant is MadinatyCompound at a distance of around 20 Km. However, other residential compounds areplanned to be constructed at distances varying from 5-15 Km. The power plant will belocated on an area of about 744,811 m2.

The site is within an existing piece of land allocated to the CEPC by the Cabinet ofMinisters according to decree 60/09/15/19 issued during the meeting on 10/9/2015,after the approval of the Armed forces.

Figure 1 shows the location of NCPP, while Figure 2 shows the power plant layout andboundaries.

Figure 1 The location of New Capital Power Plant


Figure 2 Cairo New Capital power plant layout and boundaries

The power plant land is determined by the coordinates shown in the following table:

Table 2 Coordinates of the power plant’s land

Point Latitude LongitudeNCPP 1 29°54'37.83"N 31°45'45.39"ENCPP 2 29°54'42.84"N 31°44'55.52"ENCPP 3 29°54'24.96"N 31°44'52.64"ENCPP 4 29°54'20.30"N 31°45'42.57"E

As shown in Figure 1, the power plant is located in a highly arid desert. The site is notlocated near any protectorates as the nearest protectorate is the Hassana Dome (KobbetEl-Hassana) scientific protectorate in Giza Governorate, which is 75 km away from theproject site.

As mentioned above, the construction of the power plant will not include any landacquisition as the site location was allocated to CEPC through the Cabinet of Ministersaccording to decree 60/09/15/19 issued during the meeting on 10/9/2015, after theapproval of the Armed forces. The original ownership of the land belonged to theMinistry of armed forces, as it is the operator of the Cairo / Ain Sokhna Freeway and hasthe ownership of 2 km in each direction around the road. In addition, and due to theabsence of any human activities that will be negatively affected by the power plantconstruction and operation, no livelihood restoration action plan is required.


2.2 Technical Description

The overall generating capacity of NCPP will be 4,800 MWe as it will consist of fourmodules; each module is composed of two gas turbine units of 400 MWe capacity and asteam turbine unit of 400 MWe capacity. The power plant will be firing natural gas as aprimary fuel and diesel oil (light fuel oil) as an emergency fuel. The natural gas will besupplied to the power plant through underground pipelines while the emergency dieseloil will be transported by trucks from Mustorod or Suez oil refineries.

The combined cycle power plant will consist of eight combustion gas turbines generators(CTG); each of capacity 400 MWe, eight heat recovery steam generators (HRSG) and foursteam turbines generators; each of capacity 400 MWe. The power plant will operate onan air-cooled condenser system. The required water for service and HRSG will besupplied through Cairo water network / 10th of Ramadan water network and will be usedafter pre-treatment and demineralization in the HRSG system. A wastewater treatmentfacility on the site will treat wastewater streams (both industrial and Sewage effluents)and produce an effluent suitable for discharge into the plantation irrigation systemand/or the Cairo sewer system.

The natural gas will be combusted in the gas turbines generating electricity and hotgases which will be directed to the HRSG system. The hot gases will boil thedemineralized water in the HRSG producing steam which will generate electricity in thesteam turbines generators. The exhaust steam from the steam turbines will be directedto a condenser which is cooled by an air cooling system then recirculated to the HRSG.The generated electricity will be fed to the national unified grid via a 500 kV switchgearto the 500 Kv Over Head Transmission Line (OHTL) network.

Since the Cairo New Capital area is vulnerable to earthquakes, the power plant isdesigned and constructed to conform to Uniform Building Code Zone seismic criteria,according to US regulations for earthquake. The power plant has also been designed tocomply with the international code of the National Fire Protection Authority (NFPA),which requires particular specifications for fire protection.

2.3 Supplying Natural Gas Pipelines

It is planned that the New Capital Power Plant should start operation with natural gas asthe main fuel by the end of 2016. To achieve this goal, GASCO is currently constructingthe supplying gas pipeline coming from Ain Sokhna N.G. pipeline, which will end at thePressure Reduction Station in New Capital Power Plant.

Additionally, as a method to guarantee the stability of the N.G. supply, GASCO isplanning to construct an import gas pipeline overlooking the Red Sea (Sumid pipeline).This is the main pipeline to which the New Capital power plant is considered as an


associated facility. This line starts from an import point near the seashore and ends at anexisting valve room inside Sumid company land.


3. SUMMARY OF DUE DILIGENCE ACTIVITIES

In order to achieve the due diligence objectives, the work methodology followedincluded conducting meetings with the relevant entities to gather the available data anddocuments related to the power plant, conducting desk review for the relevant projectdocuments, in addition to conducting a visit to the power plant site. The desk review wasdone to evaluate all the gathered documents and studies prepared for the power plant.On the other hand, a site visit to the power plant was conducted on June, 16th 2016 tocheck and assess the environmental and social conditions during the construction phase.

3.1 Meetings

Three meetings were held with EEHC at different phases of the due diligence project.The detailed minutes of meetings can be found in annex 5 of the study, while this sectioncontains a summary of the meetings findings.

The first meeting was held on 9/5/2016 for the purpose of gathering the available dataand documents related to the 7 power plants fed by the natural gas pipelines financedby the World Bank (including NCPP). During the meeting EEHC ensured that all thepower plants have already obtained the environmental approval from the EgyptianEnvironmental Affairs agency. Also, the social status of the power plants regarding theland acquisition aspect was discussed, and an agreement was made that EEHC will sendto the due diligence consultant the EEAA approvals, lender approvals, land ownershipdocuments, Beni Suef livelihood restoration action plan once finalized, and the contactdetails of the focal points inside the electricity production companies to get morespecific data about each power plant.

The second meeting was held on 24/5/2016 for the purpose of gathering the availabledata and documents related to Cairo New Capital, El Burullus and Beni Suef PowerPlants. In the meeting, a discussion was held regarding the ESIAs prepared for the threepower plants. The due diligence team met the consultant undertaking the social studiesand the social status of the power plants regarding the land acquisition was discussed.The due diligence team was ensured that the required permits for constructing andoperating the power plants will be sent..

The third meeting was held on 29/9/2016 for the purpose of discussing the status of thedocuments requested from EEHC. In this meeting, the due diligence consultant explainedthe list of the required information and the EEHC representative committed to supplythe data that he can get within a week.


3.2 Desk Review

The due diligence activities included reviewing the national legal requirements pertinentto the construction and operation of power plants in Egypt. In addition to that, theWorld Bank requirements concerning the environmental limits and standards wereinvestigated as well as the social requirements.

(i) Power Plant ESIA StudyThe current project proponent is the Egyptian Electricity Holding Company (EEHC). Thepower plant is a 4,800 MW capacity combined cycle power plant, with the co-ordinating initial mandated lead arrangers (the “CIMLAs”) being the Deutsche Bank AG,HSBC Bank Middle East Limited and KfW IPEX-Bank GmbH. The CIMLAs aim is to raisethree loan facilities to partially finance the Projects. One of the supporters is theGerman ECA Euler Hermes Aktiengeselleschaft on Behalf of the German Government(“Hermes”)

The ESIA is prepared by independent experts not affiliated with the project inaccordance with the national regulations and requirements, and the requirements ofthe World Bank/IFC Performance Standards and IFC EHS guidelines as well as theEquator principles (2013). The study has been presented and accepted by the EEAA.

(ii) Applicable Egyptian laws and regulationsThe Environmental Egyptian Law 4 of 1994 amended by Laws 9/ 2009 and 105/2015(with its executive regulations amended by Decree 1095/2011, 710/2012 and964/2015) specifies the applications for a license for any project. According to the law,a full EIA must be prepared for the power plant and submitted to EgyptianEnvironmental Affairs Agency (EEAA) for consideration.

The executive regulations of the environmental law specifies the limits for differentenvironmental aspects as ambient air quality, air emissions from the power plants’stacks during operation, management of hazardous and non-hazardous solid wastes,ambient noise levels, air and noise quality in the work environment and wastewaterdischarge regulations to aquatic or marine environments.

According to the guidelines issued by the EEAA for the preparation of the EIA studies,Power Plants are categorized as facilities under Category “C”, which requires thepreparation of a full EIA study.

(iii) Applicable World Bank regulationsTaking into consideration that NCPP is financed through a consortium of commercialbanks (including KfW IPEX-Bank GmbH, HSBC bank..etc.), the World Bank/IFCPerformance Standards were followed in the process of reviewing the ESIA studyunderhand as well as the IFC’s General Environmental, Health and Safety (EHS)Guidelines and the EHS Guidelines for Thermal Power Plants.


3.3 Site Visits

A site visit was carried out by the due diligence team to the power plant site, currentlyunder construction, to collect more information and check the documents related to thecurrent situation of the power plant. The details of the site visit proceeding are includedin Annex (5) of the study, and a brief about the main activities is included below.

During the visit which was carried on 16/6/2016, the due diligence team mainly met with“Orascom” representatives (the main contractor) onsite, and the environmentalpractices of the power plant were discussed, and supporting documents were obtained.Also a tour through the plant was carried out, and the construction progress to date wasdiscussed.


4. POWER PLANT COMPLIANCE WITH WORLD BANK/IFC PERFORMANCESTANDARDS

This section includes the assessment of environmental and social aspects against theWorld Bank/IFC Performance Standards and Guidelines.

4.1 PS 1- Assessment and Management of Environmental and Social Risksand Impacts

The prepared ESIA for the power plant is generally complying with the World Bank/IFCrequirements of PS 1 as shown in the following sub-sections:

4.1.1 Policy

Based on the ESAP prepared for the power plant, an environmental and social policy wasissued for the power plant and finalized by the end of May 2016. Additionally, during thesite visit the due diligence team obtained environmental and social policy from Orascom(the main contractor). The due diligence team concludes that this matches with therequirements of PS 1.

4.1.2 Identification of risks and impacts

The ESIA presents a thorough identification of environmental and social risks andimpacts. The due diligence team concludes that this matches with the requirements ofPS 1.

4.1.3 Management programs

The ESIA presents a management program that describes mitigation and monitoringmeasures that will be applied for each defined risk and impact. In the provided ESAP, theEnvironmental and Social Management System (ESMS) components were identifiedincluding actions that are marked as already closed actions. These include the policy,emergency response plan for the construction phase and stakeholders engagement plan.Other still open actions are also included such as the emergency response plan for thecommissioning and operation phases and the implementation of the stakeholderengagement plan.

Additionally, an overarching project management programme/plan was mentioned tohave been finalized for the construction phase describing the company’s approach tomanagement and mitigation measures, including: avoidance, mitigation, compensationplans and adaptation processes. Also, a final version of an overarching projectmanagement programme/plan should be set for the operation phase by 28 February2017 according to the ESAP time plan.


As the ESMS components are identified and their completion is progressing in parallelwith the construction activities, the due diligence team concludes that this matches withthe requirements of PS 1.

4.1.4 Organizational capacity and competency

The ESIA identifies the persons responsible for the implementation and supervision ofeach item in the management program. The ESIA also presented the organizational chartof the Environmental Management Staff (EMS) under the Project Management Unit(PMU). The due diligence team concludes that this matches with the requirements of PS1.

4.1.5 Emergency preparedness and response

Based on the ESIA review, an emergency preparedness and accident response plan forthe construction phase should have been prepared by the 4th quarter of 2015, andimplemented at the 2nd quarter of 2016.

This plan should have been finalized and found on site for implementation and reviewwhen requested. The due diligence team was informed that the plan is available onsite.Additionally, the Occupational Health Management plan for the construction phase wasreceived through EEHC, with the cover page shown in annex (3), and the completereport is available upon request.

Also the ESAP obtained from the site visit (June 2016 update) mentioned that theEmergency Preparedness and Response for the construction phase as closed. However,EEHC assured that operation plan will be finalized before the operation of the powerplant. The due diligence team concludes that this matches with the requirements of PS1.

4.1.6 Monitoring and review

The ESIA presents the monitoring activities as part of the management program fordifferent aspects (Air quality, Noise, Solid Waste) which also included the monitoringindicators and reporting frequency. However, the ambient air quality reports conductedduring the construction phase did not include dust measurements.

Recommendation:

Dust as a parameter should be added to the air quality reports issued during theconstruction activities.


4.1.7 Stakeholder engagement

The ESIA included the 2-phase consultation methodology showing the main participatingstakeholders and the key issues raised. The due diligence team concludes that thismatches with the requirements of PS 1.

4.2 PS 2- Labor and Working Conditions

4.2.1 Working Conditions and Management of Worker Relationship

Based on the actions identified in the ESAP, the Construction Environmental and SocialManagement Plan includes closed actions regarding the Employment and HumanResources management as well as Working Conditions Management and Monitoring.

The specific plans and reports mentioned to be available included: workeraccommodation management plan, Influx Management plan and guidance on theworkforce code of conduct. The workers grievance mechanism and the Occupationalhealth and safety management plan are issues that were closed in the ESAP.

The New Capital Social and Environmental Sustainability Policy defines the society toinclude employees, suppliers, customers, consumer, local communities and otherstakeholders. Furthermore, the Occupational Health Management Plan states that noperson under the age of 18 years will be employed through the project and specificactions for the protection of the new and expectant mothers.

In addition, the previously mentioned documents and according to the ESAP, an HRpolicy was prepared, including an accommodation policy, and the final version should befinalized and in place by 28 February 2017. The due diligence team concludes that thismatches with the requirements of PS 2.

4.2.2 Occupational health and safety management

Based on the ESIA review, an occupational health and safety plan for the constructionphase should have been prepared by the 4th quarter of 2015, and implemented at the2nd quarter of 2016. The same dates were also applicable to the preparation andimplementation of occupational health and safety plan for the operation phase.

The Occupational Health Management Plan for the construction phase was laterreceived through EEHC. As for the operation phase plan, the due diligence team wasinformed that the occupational health and safety plan for the operation phase will be inplace before the operation of the plant. The plan will be prepared in accordance with theIFC requirements.

Additionally, the ESAP reports that an Occupational Health and Safety monitoring reportis being regularly prepared and updated by Siemens/Orascom, and that the reports for


April, May and June were already reviewed. The cover page of the Occupational HealthManagement Plan applied by Orascom can be found in annex (3), and the completereport is available upon request.

The due diligence consultant checked a Quantitative Risk Assessment (QRA) conductedfor the power plant. The study identified the major hazards associated with all processwithin the power plant facilities. In addition, an emergency response plan was preparedfor the power plant to manage and handle any emergency situations during theoperation of the plant. It worth noting that during the site visit, the due diligence teamobserved that the accident log is zero. The due diligence team concludes that thismatches with the requirements of PS 2.

4.2.3 Grievance mechanism

The ESIA refers to the monitoring of the scope and number of grievances received fromthe stakeholders. However, nothing was mentioned about grievance mechanism forworkers.

The ESAP (updated in August 2016) mentioned that a workers grievance mechanism wasprepared and in place during July 2016. The due diligence team concludes that this is incompliance with PS 2.

4.2.4 Communication and training

Based on the ESIA, the workers will undergo environmental and social training in severalareas like operation of the power plant, occupational health and safety and contingencyplans. The due diligence team concludes that this matches with the requirements of PS2.

4.3 PS 3- Resource Efficiency and Pollution Prevention

4.3.1 Waste disposal

According to the ESIA, the generated solid waste from NCPP will be collected andevacuated by a licensed contractor as well as the hazardous waste that will be handledby a specialised contractor. Final disposal of wastes will be to local landfill sites, asagreed by the relevant Competent Administrative Authority. The ESIA did not mentionthe exact offsite landfill site that will receive the collected waste during the constructionnor the operation of the power plant.

During the site visit, the due diligence team checked and obtained the wastemanagement plan applied by Orascom during the construction phase (Figure 3). The duediligence team also checked the waste disposal receipts shown in annex (3) thatindicates that the liquid waste oil are sent to Petro Trade Company while the solid


hazardous wastes are sent to El Nassreya Landfill. Petro Trade is a licensed company inEgypt to collect waste oil. In addition, the contractor clarified that the constructionwaste is segregated onsite, where a waste Management company (Erteqa’a) collectssuch waste. The waste sorted and the recyclables are sent back to the site for reuse. Thedue diligence team checked the construction waste management progress reports.These reports included the monthly waste disposal logs that show the type and amountof waste generated during the construction phase. The due diligence team obtainedcopies of April and May 2016 progress reports as shown in annex (3). Also, the coverpage of the Waste Management Plan applied by Orascom can also be found in annex (3),and the complete report is available upon request.

Recommendation:

Specifying the exact landfills that the project will dispose its hazardous and non-hazardous wastes during operation phase and finalizing the contractual agreements withthe identified landfills.

4.3.2 Air emissions

According to the ESIA, ambient air measurements were conducted at four points at theboundary of the project site to monitor and record the air quality at the project area.These measurements show the concentration of the gaseous and suspended particulates(TSP, PM10 and PM2.5) pollutants in the project area before implementing the project.

An air dispersion model was conducted to predict the air quality at the project areaduring the operation of the power plant. This air model was performed for nitrogendioxide NO2 as carbon monoxide (CO), sulphur dioxide (SO2), and particulate matter lessthan 10 microns (PM10) were considered negligible. The air model results for NO2predicted that the overall ambient NO2 concentrations will be within the Egyptian limitsand the World Bank limits. Since it is not expected that CO will have a major impact dueto complete combustion of natural gas, this issue is considered to be minor and there isno need for follow up action on it.

During the site visit, the due diligence team checked the air quality reports done byOrascom inside the power plant site during the construction activities. The due diligenceteam obtained January 2016 air quality report as a sample that included results atdifferent locations inside the site indicating the concentrations of CO, NO2 and SO2 inaddition to the noise and heat levels. However, no dust measurements were conducted.The report can be found in annex (3) and it shows that the gaseous emissions atdifferent locations in the site are complying with the national law.

Recommendation:


The company should add dust as a parameter to the air quality reports during theconstruction activities.

4.3.3 Noise emissions

The due diligence team checked the noise reports done by Orascom to record the noiselevels at different locations in the site during the construction phase. As shown in annex(3), January 2016 report obtained by the due diligence team shows that the noise levelsat most of the locations in the site are complying with the national laws except forcertain locations where the workers must use ear plugs. The due diligence teamconcludes that this matches with the requirements of PS 3.

4.3.4 Water supply

Based on the ESIA, the water supply to NCPP is planned to be through Cairo waternetwork / 10th of Ramadan water network. The due diligence team obtained a copy fromthe minutes of meeting between EEHC and the Ministry of Housing specifying thestarting date of construction of the pipeline in addition to the approval of the design firmon the submitted drawings for such pipeline, attached in Annex (1).

Currently, it is foreseen that the pipeline construction is delayed and efforts are made tospeed up the construction process, however until the construction of the pipeline iscomplete, the water used for construction is obtained via trucks and stored in tanksonsite, while drinking water is purchased in the form of bulk Mineral Water Bottles. Thedue diligence team concludes that this matches with the requirements of PS 3.

4.3.5 Wastewater discharge

The ESIA stated that the sewage wastewater during the operation of the power plant willbe disposed to the sewer network system of Cairo New Capital after being treated in theon-site treatment facility. During the construction phase, the wastewater is collected inseptic tanks, and is then transferred through licenced contractors to a nearbywastewater treatment plant in New Cairo.

During the site visit, the due diligence team obtained the water and wastewatermanagement plan applied by Orascom (its cover page is shown in annex (3), and thecomplete report is available upon request). The plan briefs the responsibilities and themonitoring program that should be applied by NCPP for the management of the waterresources and wastewater treatment and disposal during the construction phase. Whileduring the operation phase, it was mentioned that a wastewater treatment plant isdesigned as part of the plant to produce effluent suitable for discharge to the sewagenetwork. The construction of the wastewater treatment plant has started about 2months ago (around August 2016).


It was mentioned by EEHA that the coordination with the Ministry of Housing for thewater supply pipelines will later include the wastewater discharge too as they are underthe same management and usually constructed as one package. However due to thecurrent schedule delay in the construction of the pipeline, the agreement has not beenfinalized yet. The due diligence team concludes that this matches with the requirementsof PS 3.

4.3.6 Hazardous waste management

Although a natural gas power plant does not produce significant amounts of waste, theESIA mentioned the procedures for storing and transporting the hazardous waste. Thedue diligence team also checked the waste disposal receipts (shown in annex 3). Theliquid waste oil are sent to Petro Trade Company while the solid hazardous wastes aresent to El Nassreya Landfill. Petro Trade is a licensed company in Egypt to collect wasteoil.

Recommendation

Specifying the exact landfills that the project will dispose its hazardous wastes duringoperation phase and finalizing the contractual agreements with the identified landfills.

4.3.7 Energy conservation

The power plant will produce 4800 MWe through 8 gas turbines (each of 400 MWe) and4 steam turbines (each of 400 MWe). The steam turbines will provide 1/3 of the totalcapacity of the power plant. The choice of implementation of a combined cycletechnology ensures having high overall process efficiency, which accordingly will help inreducing the dependency on the natural gas is in accordance with PS 3.

4.3.8 Water conservation

As mentioned above, the choice of an air-cooled condenser system for the coolingprocesses in the power plant will help in preserving large amount of water compared towater cooled systems. In addition, the treated wastewater will be reused in theplantation irrigation system. The due diligence team concludes that this matches withthe requirements of PS 3.

4.3.9 Contaminated land

Based on the ESIA, in order to avoid any ground contamination, several measures areapplied during the construction phase including provision of site drainage systems, andremoval of unsuitable waste materials on site. While for the operation phase, specificmeasures should be implemented like installation of bunds to isolate areas of potentialoil spillages in addition to covering all the oil and chemical tanks with secondary


containment structures that will hold 110% of the contents of the largest storage tank.The due diligence team concludes that this matches with the requirements of PS 3.

4.4 PS 4- Community Health and Safety

4.4.1 Spill control and management

Based on the ESIA review, an oil spill contingency plan should be prepared andimplemented by the 1st quarter of 2016 to be applied during the operation of the powerplant for monitoring and handling of the light fuel oil delivered to the site. It is worthmentioning that the light fuel oil is expected to be used less than 170 hours per year, andthat all the tanks are placed in areas with controlled drainage facilities.

The due diligence team was assured by the contractor that the plan is available and thata number of spill contingency measures during operation are included in the design e.g.the availability of oil filters in the turbines and oil collection system in transformers inthe case of spillage. The due diligence team concludes that this matches with therequirements of PS 4.

4.4.2 Structural safety of project infrastructure

Based on the ESIA, since the Cairo New Capital area is vulnerable to earthquakes, thepower plant should be designed and constructed to conform to Uniform Building CodeZone seismic criteria for earthquake. The power plant has also been designed to complywith the international code of the National Fire Protection Authority (NFPA), whichrequires particular specifications for fire protection. The due diligence team concludesthat this matches with the requirements of PS 4.

4.4.3 Traffic safety

During the site visit, the due diligence consultant checked a traffic management plandone by Orascom to manage and control the vehicle movements entering and leavingthe site. This plan includes the responsibilities and procedures to operate vehicles in thesite to reduce the risks. During the operation of the power plant, the natural gas will besupplied through pipelines, so no significant traffic volumes will take place. The coverpage of the traffic management plan applied by Orascom can be found in annex (3), andthe complete report is available upon request. The due diligence team concludes thatthis matches with the requirements of PS 4.


4.5 PS 5- Land Acquisition and Involuntary Resettlement

4.5.1 Land acquisition

The power plant is located on an area of about 744,811 m2 in a highly arid desert landwith no residential properties. This land was allocated to CEPC by the Cabinet ofMinisters according to decree 60/09/15/19 issued during the meeting on 10/9/2015,after the approval of the Ministry of defense.

The allocated land is included within the 2 km distance around Cairo /Sokhna road,which was built by the Ministry of Defence, and is considered as Military land andaccordingly handed over from the Ministry of Defence to EEHC. Accordingly, a landhandover meeting was held, and the meeting minutes are shown in annex (4). Duringthis meeting, it was agreed between the EEHC representative and the representativesfrom the Ministry of defence that the land should be handed over immediately for theworks to start, and that the concerned stakeholders should be immediately informedabout that.

The electric generated power will be transmitted through existing network transmissionlines. In addition, there are no human activities that will be negatively affected by thepower plant construction and operation.

Therefore, no social issues or claims were recorded as the development of the powerplant did not include any land acquisition and did not affect any local community. Thedue diligence team concludes that this matches with the requirements of PS 5.

4.6 PS 6- Biodiversity Conservation and Sustainable Management ofLiving Natural Resources

NCPP is located at a selected site at the north of the Cairo / Ain Sokhna Freeway at adistance of around 50 Km from Cairo and 60 Km from Ain Sokhna. Since the power plantis located in a highly arid desert land, no living natural resources are affected by theimplementation of the power plant. Only species that can tolerate the desert conditionsare found in the project area. The ESIA also presented some mitigation measures tominimize disturbance to the flora and fauna species nearby the site. The due diligenceteam concludes that this matches with the requirements of PS 6.

4.7 PS 7- Indigenous People

No indigenous people are found in the project area, so this performance standard doesnot apply.


4.8 PS 8- Cultural Heritage

As indicated by the ESIA, the power plant’s location does not include any archaeologicalremains. Therefore, this performance standard does not apply.

4.9 WBG EHS Sector Guidelines for Thermal Power Plants

The power plant’s status was checked and compared to the WB guidelines for thermalpower plants. All the guidelines were covered and checked through the review with theperformance standards.

4.9.1 Mitigation of air emissions

The following table shows a comparison between the air emissions limits in theguidelines and the design parameters for the turbines. The table shows that the designvalues comply with the World Bank limits.

Table 3 Comparison of air emissions between turbine design and WB limits

Parameter Turbine design World Bank limits(mg/Nm3)

Value, mg/m3 Natural Gas Fuel OilNOx 45 51 152SO2 0 N/A Use of 1% or

less S fuel(NDA)

Use of 0.5%or

less S fuel(DA)

TSP&PM10 <5 N/A 50 (NDA)30 (DA)

CO 100 Not Specified

Regarding the mitigation of the air emissions from the power plant, specific measureswill be applied during the operation of the power plant. Low NOx combustors will beused in addition to that the stack height is 60 m to allow good dispersion to thesurroundings.

4.9.2 Energy efficiency and GHG emissions

CO2 is considered the main GHG emitted during the construction activities of the powerplant and from fuel combustion during the operation phase. The choice of implementing


combined cycle power plant in addition to utilizing natural gas as the primary fuel willhelp in minimizing the CO2 emissions from the power plant.

Based on the ESIA, the generating efficiency of the power plant is set to be 55-58% withassociated CO2 emissions of 390 g/KWh. As per WBG EHS Sector Guidelines for ThermalPower Plants, the typical CO2 emissions performance for a combined cycle power plantfiring natural gas is 51% with CO2 emissions of 396 g/KWh.

According to the ESAP, a report on GHG emissions and plant efficiency was prepared tocalculate GHG emissions in tonnes CO2e per year and grams CO2e/kWh. This report willbe prepared annually to check the plant efficiency.

4.9.3 Thermal discharges

The power plant will operate on an air-cooled condenser system. Also, the wastewatertreatment plant onsite will produce an effluent suitable for discharge into the sewersystem. These actions will prevent the presence of any thermal discharges to thesurroundings.

4.9.4 Solid wastes

Covered in section 4.3.1

4.9.5 Hazardous materials and oils

In order to prevent any hazard associated with hazardous waste handling, as mentionedabove, there is a waste management plan applied by Orascom during the constructionphase. This plan includes the procedure of storing and transporting any hazardous ornon-hazardous waste. Regarding the waste storage, the plan ensures that all the wastewill be stored in containers at designated facilities which are designed with animpervious concrete pad and bunding which provides for 110% capacity of the totalvolume of the largest container. Also, all the containers should be labelled according toits content and appropriately sealed. Concerning the waste transportation, approvedcontractors only are allowed to transport the waste by appropriate vehicles by trainedoperators.

4.9.6 Noise

For the construction phase, as mentioned in section 4.3.3, the noise records reviewed bythe due diligence team showed that the noise levels at different locations are complyingwith the national laws except for certain locations where the workers must use earplugs.


According to the ESIA, specific design measures were applied to mitigate the noiseemissions during the operation of the power plant. These measures include enclosingthe main equipment in buildings and equipping the compressors with air silencers.

4.9.7 Occupational health and safety


4.9.8 Monitoring emissions

Based on the ESIA, regarding the emissions monitoring during the operation of thepower plant, there will be automatic continuous monitoring of the stacks emissions forNOx, SO2, particulate matter and CO in the stacks. Concerning the ambient air qualitymonitoring, 2 continuous monitoring stations will be installed to record NOx, SO2,particulate matter and CO as well as the meteorological data. These stations will beelectronically connected to the EEAA ambient monitoring system.

All these actions are complying and consistent with the requirements of WBG EHS SectorGuidelines for Thermal Power Plants.

4.10 WBG EHS General Guidelines

4.10.1 Environmental

(i) Air emissions and ambient air qualityCovered in section 4.1.3

(ii) Energy conservationCovered in sections 4.3.74.3.7 and 4.9.2

(iii) Wastewater and ambient water qualityCovered in section 4.3.5

(iv) Water conservationCovered in section 4.3.8

(v) Hazardous materials managementCovered in section 4.3.6 and 4.9.5

(vi) Waste managementCovered in section 4.3.1 and 4.9.4

(vii) NoiseCovered in section 4.3.3 and 4.9.6

(viii) Contaminated landCovered in section 4.3.9


4.10.2 Occupational health and safety

(i) General facility design and operationCovered in section 4.2.1, 4.4.1, and 4.4.2

(ii) Communication and trainingCovered in 4.2.4

(iii) HazardsCovered in sections 4.2.1 and 4.4.1

(iv) Personal protective equipmentCovered in section 4.2.1

(v) Special hazard environmentsCovered in section 4.2.1

(vi) Monitoring


4.10.3 Community health and safety

(i) Water quality and availabilityCovered in section 4.3.4

(ii) Structural safety of project infrastructureCovered in section 4.4.2

(iii) Life and fire safety (L&FS)Covered in sections 4.2.1 and 4.4.2

(iv) Traffic safetyCovered in section 4.4.3

(v) Transport of hazardous materialsCovered in sections 4.3.6 and 4.9.5

(vi) Disease preventionNo issues anticipated

(vii) Emergency preparedness and responseCovered in section 4.2.1

4.10.4 Construction and decommissioning

(i) EnvironmentThis was covered in the abovementioned guidelines. The due diligence teamconcludes that this matches with the WBG EHS guidelines.


(ii) Occupational health and safetyThis was covered in the abovementioned guidelines. The due diligence teamconcludes that this matches with the WBG EHS guidelines.

(iii) Community health and safety

This was covered in the abovementioned guidelines. The due diligence teamconcludes that this matches with the WBG EHS guidelines.

4.11 Summary of the Environmental and Social Findings

The due diligence team concluded that NCPP is considered to be in compliance with theWorld Bank/IFC Performance Standards. However, minor issues are identified, which donot pose any risks to the construction and operation of the project. The following tablesummarizes the main comments and recommendations.

Table 4 Summary of the Environmental and Social findings

Item Aspect IssuePS 3- Resource Efficiency and Pollution Prevention

1. Waste Disposal The waste disposal facility that will be usedduring operation of the power plant is notspecified by the ESIA nor currently known bythe project owner.

2. Air Emissions The due diligence team obtained January airquality report as a sample that includedresults at different locations inside the siteindicating the concentrations of CO, NO2 andSO2 in addition to the noise and heat levels.However, no dust measurements wereconducted

3. Hazardous waste management The hazardous waste disposal facility that willbe used during operation of the power plantis not specified by the ESIA nor currentlyknown by the project owner.


5. POWER PLANT COMPLIANCE WITH NATIONAL REGULATIONS

The review of the power plant’s documents and the site visit conducted to the plant’ssite showed that the power plant is complying with the national laws and regulations. AnESIA for the power plant was prepared in accordance with the national regulations andrequirements and submitted for EEAA for approval. The approval of EEAA was issued on10/12/2015, and in presented in Annex (1) of this report.

Based on the documents’ review and the site visit, the power plant’s design andconstruction activities comply with the limits specified in the executive regulations of theenvironmental law for the different environmental aspects. This includes ambient airquality, air emissions from the power plants stacks during operation, management ofhazardous and non-hazardous solid wastes, ambient noise levels, air and noise quality inthe work environment, and wastewater discharge regulations.

Regarding land acquisition of the power plant’s site, as mentioned above, this land wasallocated to CEPC by the Cabinet of Ministers according to decree 60/09/15/19 issuedduring the meeting on 10/9/2015, after the approval of the Armed forces. Therefore, thedevelopment of the power plant did not include any land acquisition and did not affectany local community.

The national regulations also include issuing the key permits required for theconstruction and operation of the power plant. The due diligence team has received theenvironmental permit shown in annex (1) for review. In addition, the due diligence teamhas received the land handover meeting minutes between the Ministry of Defence andEEHC which is considered as an approval of Ministry of Defence on the project, and at alater stage the Land allocation Letter from the Cabinet of Ministers was received fromEEHC (Annex 4). In addition, the EIA study for the power plant’s OHTL was alreadysubmitted by the Egyptian Electricity Transmission Company (EETC) and the EEAAapproval was acquired.

As part of assessing the project compliance with local laws and regulations, the duediligence team checked the EEAA approval conditions and evaluated the compliancestatus as shown in the following table.

Table 5 EEAA approval compliance status

Item Condition Compliance status1 Committing to the use of Natural Gas as

the main fuel for the boilers used in theplant, and using Light Fuel Oil (solar) as asecondary fuel in case of emergency onlyand within the limit of 2% of the annual

Complying:According to design considerations,the combustion turbines willoperate mainly using natural gasexcept in case of emergency


operating hours2 Periodical and continual update of the

Quantitative and Qualitative Riskassessment study

Complying:According to the ESAP, the QRA hasbeen updated once to include moremitigation measures

3 Committing to obtaining the approval ofthe Ministry Water Resources andIrrigation

In progress:Negotiation process has started toobtain the approval

4 Committing to the instruction towards thesubmission of a scoped EIA study for theElectricity Transmission Lines linked to thePower Plant

Complying:EEAA approval is obtained

5 Committing to the installation ofContinuous Emissions Monitoring System(CEMS) for the stacks emissions, andlinking them to the National MonitoringNetwork

Complying:Taken into consideration in thedesign and will be implementedduring the operation phase

6 Committing that the cumulative pollutionload of the ambient air pollutants in thearea does not exceed the limits set by theexecutive regulations amended by decree1095/2011

Complying:According to the mitigationmeasures mentioned in the design(discussed in section 4.9.1), thepower plant is complying with thiscondition

7 Abiding by the maximum permissibleambient air pollutants levels in accordancewith annexes 5 and 6 of the executiveregulations amended by Decree1095/2011


8 Committing to the maximum permissiblenoise levels in accordance with annex 7 ofthe decree 1095/2011 and its amendmentby decree 964/2015

Complying:As discussed in section 4.9.6,measurements are being conductedduring the construction andmitigation measures are included inthe design considerations for theoperation phase

9 Commitment to not exceed the maximumpermissible pollutant levels inside thework environment, while limiting theemitted Nitrogen Oxides (NOx) emissionsthrough the use of low NOx emittingcombustibles as mentioned in the study


10 Environmentally safe and proper disposalof the solid waste resulting from theconstruction and operation over regular

In progress:Implemented during theconstruction phase and disposal


intervals receipts and log were checked asshown in annex (3).Specific landfills are not yet specifiedfor the operation phase.

11 Environmentally safe and proper disposalof the hazardous wastes resulting fromthe activities through an approved entity

In progress:Implemented during theconstruction phase and disposalreceipts were checked as shown inannex (3).Specific landfills are not yet specifiedfor the operation phase.

12 Environmentally sound and safe disposalof the used hazardous materials andkeeping the Material Safety Data Sheets(MSDS) for all the chemicals used

Complying:Should be implemented during theoperation phase

13 Committing to the installation of therequired stack in accordance to article 42of the executive regulations amended bydecree 1095/2011 and decree 964/2015

Complying:Taken into consideration in thedesign and construction is already inprogress

14 Commitment to the use of air cooledcondenser system to the suggestedexpansions as mentioned in the study


15 Commitment to the treatment of theresulting sewage from the operation ofthe plant in the designated treatmentplant and that the treated wastewaterfrom the treatment plant is in accordancewith law 93/1962 and Decree 44/2000 andother ministerial degrees regulating thewastewater discharge to the sewagenetwork.


16 Abiding to the maximum permissible limitfor exposure to electromagnetic waves

Complying:Taken into consideration in thedesign

17 Abiding by the Environmental and SocialMonitoring Plan and registering the resultsof the measurements and analysis in theenvironmental register

Complying:The construction ESMP has beenupdated and the operation ESMPwill be updated beforecommissioning phase regularlyupdated

18 Commitment from the company toachieve societal consensus and increasingthe social participation during theconstruction and operation periods

Complying:Although the power plant is notsurrounded by residential areas, thepower plant has a stakeholdersengagement plan, and a workers


grievance mechanism is in place.19 Preparing an Environmental Register to

include all the results of the periodicalmonitoring from the combustion unit andthe hazardous waste disposal register

Complying:A complete environmental registershould be prepared during theoperation phase and for theconstruction phase, environmentalrecords are being maintained andregularly updated


6. CONCLUSIONS AND RECOMMENDATIONS

Based on the review of the available data, the meetings and discussions conducted withthe EEHC representatives, and the site visit conducted to the power plant site, the duediligence team concluded that NCPP is considered to be in compliance with the WorldBank/IFC Performance Standards. None of the comments mentioned in the previoussections may pose any environmental or social threats on the successful constructionand operation of the power plant. However, the following recommendations need to beconsidered and implemented within the proposed time frame as shown in the followingtable:

Table 6 Recommended Corrective Action Plan

Item Aspect Required action Time frame Verificationmethod

1. Air Emissions Adding dust as a parameter to theair quality reports during theconstruction activities.

By the endof the 1st

quarter of2017

Receivingairemissionsreport

2. Wastedisposal

Specifying the exact landfills thatthe project will utilize to dispose itswastes during operation phase andfinalizing the contractualagreements with such landfills.


quarterafteroperation

Receivingthe wastedisposalreceipts

3. Hazardouswastemanagement

Specifying the exact landfills thatthe project will utilize to dispose itshazardous wastes during operationphase and finalizing the contractualagreements with such landfills.


quarterafteroperation

Receivingthehazardouswastedisposalreceipts


ANNEX (1) APPROVALS FOR NCPP

Figure A- 1 EEAA approval for construction and operation of NCPP (1)


Figure A- 2 EEAA approval for construction and operation of NCPP (2)

Arab Republic of EgyptEgyptian CabinetMinistry of State for Environmental Affairs Registration Number: 6147Egyptian Environmental Affairs Agency Date: 10/12/2015


Mr. Engineer/ Gaber Desouki MostafaChairman of the Egyptian Electricity Holding Company

After Greetings,

With reference to the letter received from the Member of the Board of Directors dated30/11/2015 to which was attached the Environmental study regarding the projectnamed “Construction of the Cairo New Capital Power Plant Project” which will operate incombined cycle mode with a total capacity of 4800 MW (2 x 400 MW Combustion GasTurbine Generators, 1 x 400 MW Steam Turbine Generator), on an area of 744,811 m2

inside the currently allocated project site, through/ Egyptian Electricity Holding Companyat the Address/ 45 km East of Cairo outside the greater Cairo boarder and 50 km West ofSuez.

We would like to inform you that after revising and evaluating the deliveredenvironmental impact assessment study, the EEAA approves the submitted project, withthe condition of abiding by all the specifications and procedures mentioned in theEnvironmental Impact/ Assessment (EIA) study submitted to the EEAA, and to all therules, conditions, and standards stated in law no. 4 /1994 amended by law no. 9 /2009and the executive regulations amended by decree 1095/2011, decree 710/2012 anddecree 964/2015 with law 105/2015 while committing to the following conditions:

1. Committing to the use of Natural Gas as the main fuel for the boilers used in theplant, and using Light Fuel Oil (solar) as a secondary fuel in case of emergencyonly and within the limit of 2% of the annual operating hours (with a maximum of170 hours) as mentioned in the EIA study.

2. Periodical and continual update of the Quantitative and Qualitative Riskassessment study, and delivering continuous training to the specialized workers.

3. Committing to obtaining the approval of the Ministry Water Resources andIrrigation (MWRI) in case that the project is located in the path of any valleys orstorm water drains before the commencement of any protection activities andsubmitting a scoped EIA for the proposed protection measures.

4. Committing to the instruction towards the submission of a scoped EIA study forthe Electricity Transmission Lines linked to the Power Plant.

5. Committing to the installation of Continuous Emissions Monitoring System(CEMS) for the stacks emissions, and linking them to the National MonitoringNetwork at the EEAA at the cost of the company in accordance with the technicalspecifications set by the EEAA.



6. Committing that the cumulative pollution load of the ambient air pollutants inthe area does not exceed the limits set by the executive regulations amended bydecree 1095/2011 and with accordance with the measurements include in thestudy.

7. Abiding by the maximum permissible ambient air pollutants levels in accordancewith annexes 5 and 6 of the executive regulations amended by Decree 1095/2011with limiting the amount of gaseous pollutants.

8. Committing to the maximum permissible noise levels in accordance with annex 7of the decree 1095/2011 and its amendment by decree 964/2015, and taking thenecessary precautions to that end as mentioned in the EIA study.

9. Commitment to not exceed the maximum permissible pollutant levels inside thework environment in accordance with annex 8 of the executive regulationsamended by decree 1095/2011, while limiting the emitted Nitrogen Oxides (NOx)emissions through the use of low NOx emitting combustibles as mentioned in thestudy.

10. Environmentally safe and proper disposal of the solid waste resulting from theconstruction and operation over regular intervals.

11. Environmentally safe and proper disposal of the hazardous wastes resulting fromthe activities (Filters, used oil and grease resulting from the operation andmaintenance activities) through an approved entity in accordance with the lawsand regulations as mentioned in the study and in compliance with article 28 ofthe executive regulations amended by decree 1095/2011 and decree 964/2015.

12. Environmentally sound and safe disposal of the used hazardous materials inaccordance to article 31 of the executive regulations amended by decree1095/2011 and keeping the Material Safety Data Sheets (MSDS) for all thechemicals used.

13. Committing to the installation of the required stack in accordance to article 42 ofthe executive regulations amended by decree 1095/2011 and decree 964/2015.

14. Commitment to the use of air cooled condenser system to the suggestedexpansions as mentioned in the study.

15. Commitment to the treatment of the resulting sewage from the operation of theplant in the designated treatment plant as mentioned in the study, whilecommitting that the treated wastewater from the treatment plant is in



accordance with law 93/1962 and Decree 44/2000 and other ministerial degreesregulating the wastewater discharge to the sewage network.

16. Abiding to the maximum permissible limit for exposure to electromagnetic wavesin accordance with the regulations of the International Commission On Non-ionizing Radiation Protection (ICNIRP).

17. Abiding by the Environmental and Social Monitoring Plan and registering theresults of the measurements and analysis in the environmental register, whichshould be available in case of environmental auditing.

18. Commitment from the company to achieve societal consensus and increasing thesocial participation during the construction and operation periods.

19. Preparing an Environmental Register to include all the results of the periodicalmonitoring from the combustion unit and the hazardous waste disposal registerin accordance with article 33 of annex 3 and table 2 of the executive regulationsamended by decree 1095/2011, and ensuring the availability of the registerduring environmental audits.

This approval is from the environmental perspective only without breaching any otherlaws, rules or regulations related to this activity, and in case of non-compliance with anyof the requirements mentioned above, this approval will be considered invalid, and thecompany will bear its responsibility towards any environmental damages.

Chief Executive Officer

(Eng. Ahmed Abou El-Seoud)


Figure A- 3 Coordination meeting minutes for the water pipeline connection for NCPP (1)


ANNEX (2) SOIL AND GROUNDWATER ANALYSIS


ANNEX (3) ENVIRONMENTAL PRACTICE DOCUMENTS

Figure A- 9 Liquid waste receipt-1


Figure A- 10 Liquid waste receipt-2


Figure A- 11 Hazardous solid waste receipt-1


Figure A- 12 Hazardous solid waste receipt-2


Figure A- 13 May construction waste management progress report-1


Figure A- 17 January Air Quality and Noise levels Report-1


Figure A- 22 Cover page of the Occupational Health Management Plan applied by Orascom


Figure A- 23 Cover page of the Waste Management Plan applied by Orascom


Figure A- 24 Cover page of the Water and Wastewater Management Plan applied by Orascom


Figure A- 25 Cover page of the traffic management plan applied by Orascom


ANNEX (4) LAND ALLOCATION LETTER AND HANDOVER MEETING MINUTES

Figure A- 26 Land Allocation Letter from the Cabinet of Ministers - 1


Figure A- 27 Land Allocation Letter from the Cabinet of Ministers - 2


Figure A- 28 Land handover meeting minutes-1


Figure A- 29 Land handover meeting minutes -2


ANNEX (5) MEETINGS AND SITE VISIT MOM

Meetings Proceedings Details:

Table A- 1 First Meeting at EEHC

Entity EEHC

Attendees

Eng. HekmatAbdulrahman Selim

General Director of the Environmental studiesDepartment, Ministry of Electricity and Energy

Dr. Ismail El Sawy Senior Research Engineer at the EnvironmentalProject Management Sector, EEHC

Dr. Mohamed FathyTash

Environmental Assessment DepartmentManager, Egyptian Natural Gas Co. (GASCO)

Dr. Amr Abd El Aziz President, Integral ConsultDr. Ahmad Wafiq Technical Team Lead, Integral Consult

Date 9/5/2016Purpose Gathering the available data and documents related to the 7 power

plants fed by the natural gas pipelines financed by the World Bank(including NCPP)

Summary EEHC clarified that all the power plants including NCPP have already obtained the

environmental approval from the Egyptian Environmental Affairs Agency (EEAA) The social status of the power plants regarding the land acquisition aspect was

discussed. EEHC clarified that out of the three new power plants (NCPP, ElBurullus and Beni Suef) a livelihood restoration action plan is only required forBeni Suef, while no similar study is required for NCPP.

EEHC will send to the due diligence consultant the EEAA approvals, lenderapprovals, land ownership documents, and Beni Suef livelihood restoration actionplan once finalized.

EEHC will also send to the due diligence consultant the contact details of the focalpoints inside the electricity production companies to get more specific data abouteach power plant.

Table A- 2 Second Meeting at EEHC

Entity EEHC

Attendees

Dr. Ismail El Sawy Senior Research Engineer at the EnvironmentalProject Management Sector, EEHC

Dr. Maher Aziz Consultant contributed in preparing the ESIAfor the power plant

Graham Macdonald Planner/ Social ScientistDr. Amr Abd El Aziz President, Integral ConsultEng. Esraa El Mitainy Senior Environmental Specialist, Integral


ConsultDate 24/5/2016Purpose Gathering the available data and documents related to Cairo New

Capital, El Burullus and Beni Suef Power PlantsSummary The meeting included discussion on the ESIAs prepared for the three power

plants. The required permits for constructing and operating the power plants were

requested to be checked and reviewed as they were not included in the ESIA. Dr.Ismail ensured that the permits are secured and will be sent to the due diligenceconsultant for review.

The social status of the power plants regarding the land acquisition aspect wasdiscussed. The meeting concluded that the construction of Cairo New Capitalpower plant did not need any action of land acquisition. On the other hand, Benisuef power plant included land acquisition and livelihood restoration plans arebeing prepared and planned to be submitted to the lenders by the 1st of June,2016. As for El Burullus power plant, no action was primarily taken, but at arecent stage of implementation, new land was acquired by the contractor, and aconsultant was hired to investigate the status of the acquired land.

The due diligence consultant requested conducting site visits to the three powerplants. They were asked to send their IDs for the permissions.

Table A- 3 Third Meeting at EEHC

Entity EEHC

Attendees

Dr. Ismaail El Sawy Senior Research Engineer at the EnvironmentalProject Management Sector, EEHC

Eng. Ehab Shaalan Senior Environmental Specialist, Environmentand Natural Resources, World Bank

Mrs. Amal Faltas Senior Social Specialist, World BankDr. Magda Amin Director General of Environmental Protection

Department, Egyptian Natural Gas Co. (GASCO)Dr. Azza El-Trabili Executive General Manager of the

Environmental Protection Department, GASCODr. Mohamed FathyTash

Environmental Assessment DepartmentManager, GASCO

Eng. Ahmed Galal Environmental Assessment DepartmentAssistant Manager, GASCO

Dr. Amr Abd El Aziz President, Integral ConsultEng. Esraa El Mitainy Senior Environmental Specialist, Integral

ConsultDate 29/9/2016Purpose Discussing the status of the documents requested from EEHC and not

received until the submission of the second draft reportSummary


The meeting started with a discussion about the importance of the due diligencereports as part of the Natural Gas Funding preparation process and accordinglythe importance of obtaining all the required information for the plants’environmental and social practices.

EEHC ensured their commitment to supply the required information in order tosupport the preparation of the reports

The due diligence consultant explained the list of the required information, withspecial focus on the Livelihood Restoration Plan, and changes in ESIA for Beni SuefPower plant, Land Acquisition and Compensation Framework for Burullus as wellas the missing land allocation permits and practice proof for other power plants.

EEHC representative committed to do his best to supply the information he cancollect within a week after the meeting.

Site Visit Proceedings Details:

Table A- 4 Site Visit to New Capital Power Plant Site

Entity New Capital Power Plant

Attendees

Eng. Mohamed ElDessouky

Project Director from Orascom, New CapitalPower Plant

Eng. Saber Diab Lead manager from Orascom, New CapitalPower Plant

Mr. Ihab Shalaan Environmental Consultant, World BankWorld BankDelegationDr. Mohamed FathyTash

Environmental Assessment DepartmentManager, Egyptian Natural Gas Co. (GASCO)

Dr. Amr Osama President, Integral ConsultEng. Esraa El Mitainy Senior Environmental Specialist, Integral

ConsultDate 16/6/2016Purpose Site visit and gathering the available data and documents related to

New Capital Power PlantSummary A brief description about the current plant progress was presented. The land Acquisition was mentioned to be mainly from the Army as there is 10

km to each side of the Sokhna road belongs to the Army, who built and operatesthis road.

Water supply will be from the municipality by pipeline from the 10th of Ramadan,and it is currently under construction. In the meantime, the water used in theconstruction phase is mainly obtained via water tankers and stored in tanksonsite, while the drinking water is purchased in the form of Bulk Mineral WaterBottles. There is an agreement already in place between the EEHC and the


Ministry of Housing to supply 5,000 m3/day water. Construction started on the 11th of July 2015. The first CTG unit should be

connected to the grid by December 2016, second CTG unit by the end of March2017, third CTG unit by the end of November 2017, while the 4th CTG and all theSTGs are planned to be operational by May 2018 (project full operation).

The ground water research institute was contacted to study the status of theground water in the area. According to the institute, there were no historicalstudies specifying the ground level in the project area. To check the groundwaterlevel, a borehole of 150 m was performed by Orascom on-site and no groundwater was found.

The Environmental and Social Action Plan (ESAP) was issued on the 5th ofDecember 2015 and distributed to the plant (A copy was obtained).

A traffic management plan is already in place (obtained) and a designatedcontractor is hired for the transportation of oversized vehicles. The contractor isresponsible for coordinating with the ministry of transportation.

The construction waste is segregated onsite. A waste management company(erteqa’a) collects the waste, sorts it and sends the recyclables back to the sitefor reuse. The final disposal of the waste is Erteqa’a’s responsibility. A waste logis kept onsite (samples were obtained).

Hazardous waste is sent to Petrotrade Company (waste oil and filters), anothercontractor is hired for the other hazardous wastes (contacted upon request).Samples of the hazardous waste disposal receipts were obtained.

Other data that was requested by email from Orascom included:- Hazardous waste register- Contracts for the waste management contractors (For all the wastes Erteqa’

and hazardous waste collection for disposal Nassreya)- Occupational Health and Safety Procedure- Emergency Response Procedure- Stacks permit- Water connection agreement- Ministerial or presidential Decree for land allocation.

A visit to the construction site was concluded with a tour by bus to check thecurrent progress.

Environmental and Social Due Diligence of New Capital ...

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