UITEGRATEDSAFEGUARDSDATASHEET CO:-.ICEPT STAGE

Report No.:

Da te ISDS Prepared/Updated:

I. BASIC INFORMATION

A. Basic Project Data

Country: SENEGAL I Project ID: P!43605 I Additional Projec1 lD (if any):

Project Name: Taiba Ndiayc Power Project Task Team Leader: Demctrios Papathanasiou F.stimated Appraisal Date: April 30. 2013 I Estimated Board Date: October 12, 20 13 Managing Unit: AFTEG I Lending Instrument: Partial Risk Guarantee Sector: Power (100%) Theme: lnfi-astructurc services for private sector development (100%)

Financing sources I Amount IBRD Amount (US$m.): IDA Amount (US$m.): 40 Other financing amounts by source:

Private sector and Debt Financiers 160 Total: 200

Environmental Cat~Ol)': A - Full Assessment Simplified Processing Simple fxl Repeater [] Is this a transferred eroject Yes [] No [x]

R. Project Objectives [from section 2 of PCNJ:

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The project development objective is to improve reliability and securi:y of power supply in Senegal.

C. P roject Description [from section 3 of PCNJ: The proposed project forms part ofSENELEC's emergency response plan for the e lectricity sector. Taiba Ndiaye would address shor1-tem1 power shortages at a reduced cost compared to currently used diesel generation. It would also improve overall system reliability due to added capacity and physical location within SENELEC's network. It appears to be the project, which can most rapidly be brought online to alleviate power shortages, as it involves a relatively experienced sponsor and IFC as a potential financier and co-developer through Infra Ventures.

Taiba Ndiayc will be developed as an IPP selling power to SENELEC under a 15-year Power Purchase Agreement (PPA). The overall project consists of a new power plant. with an installed capacity of 87.5MW (70 MW guaranteed availability), to be located in Taiba Ndiayc, about 90km north east from Dakar. It will involve: (i) the construction and installation of 5 X 18 V48/60- SOOrpm gensets running on heavy fuel oil (HFO) that could be in the future converted to operate on natural gas, along with a steam recuperation turbine (adding about 7MW and allowing for a maximum efficiency} --on a (Build, Own, and Operated (BOO)J basis-- which will include the design, finance, supply, erection, commissioning, operation, and maintenance of the plant for a 15 year term; (i i) grid interconnecting 220kV substation; and {iii) fuel storage facilities.

The project will be developed by Tobene Power SA (TP), a Special Purpose Vehicle (SPY), incorporated in December 201 1 under the laws of Senegal. It will be owned [90 percent] by Melee PowerGen Services

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S.A. (MPG), a subsidiary ofMatelec Group of Lebanon, and [10] percent by IFC lnfraVentures. MPG is growing as a south-south investor in the Africa region. Their most recent project is the Thika Power project in Kenya, for which the World Bank provided a Partial Risk Guarantee (PRO) and closed its financial in August 2012. The Taiba Ndiaye project design and structure is similar to Thika. Prior to Thika, MPG was the developer of the Kounounc Power project (65 MW) in Senegal.

MPG and MAN Diesel and Turbo SE (MAN) of Germany will form a consortium to enter into an EPC Contract with TP. MAN will be responsible for the basic design and will provide the power engiRes and steam turbine, while MPG will be responsible for the civil works and electrical installation. MAN will provide supervision for the installation of key components and conduct the plant commissioning under the EPC. This will be the second time the two parties work together as a consortium on a power project (after Thika IPP in Kenya). For the operation and maintenance of the projecL the SPV will enter into the following agreements: ( I) a Maintenance and Coordination of the Operation of a Power Plant (bct\vecn TP and MAN Diesel & Turbo France SAS); (2) a Spare Parts Supply (between TP and MAN Diesel & Turbo France SAS). MPG will be in charge of the local manpo~er that will be trained by and v.ork under the supervision of MAN. It is expected that TP will enter into a Fuel Supply Agreement with Societe Africaine de Raffinage (SAR) the only -privately owned- oil refinery in Senegal. The company has negotiated a Power Purchasing Agreement (PPA) with SENELEC.

The project's total cost is expected to be around [US$160 million], to be structured on a limited recourse basis with a target debt to equity ratio of (75:25] -the financing structure is under development. MPG has approached lFC as a lender to provide senior A loan, while IFC is also a joint developer through IFC lnfraVentures. Other project lenders may be: the AfDB, EAlF, FMO, and Bank Ouest Africaine de Dcveloppernent (BOAD).

D. Project location and salient physical characteristics relevant to the analysis of environmental and social risks and impacts (if known): The Power Plant's site (4.5 ha) is located in the rural commune of Taiba Ndiaye in the Province of Tivaouane. The area hosts typical Sahel ian vegetation on a flat topography with no water body around; but, the threat to underground water resources in the vicinity of the project site may be questionable.

E. Borrower' s Institutional Capacity for Effective SEMS: Senegal has one of the soundest environmental institutional and regulatory frameworks among the West African countries. The regulatory framework clearly spells out the environmental permitting procedure and the obligations of project developers as regard the implementation of the environmental and social management plan (ESMP). The Directorate of Environmental Assessment and Control (" 'Direclion des Evaluations Environnementoles et du Co111r6/e" - DEEC) has the ovemll responsibility of enforcing the environmental assessment procedure through the approval ESlAs and the monitoring of Environmental and Social Management Plans (ESMPs); this institution is considered to have adequate capacity and some experiences in the processing of the safeguard instruments of Bank funded - projects. Nevertheless, the project will be owned and operated by a private sector which experience and capacity in environmental management, of such infrastructure, are not known yet. Furthermore, the environmental management of this type of infrastructure becomes critical only after the construction, if sound environmental norms/standards and survey capacity were not in place. Therefore, an in-depth analysis of the national environmental auditing regulatory framework and procedure will be carried out during the project preparation to ensure that the operation phase adverse externalities will be under control during implementation.

F. Environmental and Social Safeguards Specia lists on the Team: Maman-Sani lssa. Sr. Environmental Specialist, AFTN 2 Demba Balde, Salamata Bal; Sr. Social Development Specialists

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H. PERFORMANCE STANDARDS THAT MIGHT APPLY

Performance Standards (please explain wlzv) Yes No TBD PS 1: Assessment and Management of F.nvironmental and X Social Risks and Impacts The power plant is of substantial production capacity (8?MW) and will be located in a place close to residential areas. The main foreseen environmental and social adverse risks and effects are related to: (i) noise over the acceptable standards for residential areas; (ii) air pollution and contribution to greenhouse gas emission from the plant smokes; (iii) liquid waste (used oil) generation inducing the pollution of surrounding area and underground water; (iv) occupational health and safety risks in case employees are not equipped with appropriate protective materials; (v) explosion and any other machinery accidental risks; etc. Yet, due to its nature and scale (medium-big size power plant). the project is classified Environmental category A and as Classified Industrial Infrastructure Type I, under the national environmental legislation (Law 2001-0 I of January 15, 200 I). The Bank Group classification at this stage is also category A and, the IFC performance standards I, 2, 3 and 4 apply. Especially the ongoing environmental and social impacts assessment (ESAI), launched on August 27, 2012, will have to come out with accurate propositions for: (i) nuisances (air pollution and noises) prevention and control: (ii) an emergency preparedness plan; (iii) a sound environmental and social management system (ESMS) to be set in by the owner/operator; (iv) the strengthening of the national capacity on environmental norms and standards in the sector. PS 2: Labor and Working Conditions X

The developer will be employing various categories of direct workers (temporary. permanent) and contracted workers throughout the lifecycle of the project. Therefore, the establishment of internal rules to comply with any eligible legislation related to labor and working conditions and rights should of imponant. The ESMS will recommend guidance to incorporate in the environmental and social action elan (ESAP) to be endorsed b~ the developer. PS 3: Resource Efficiency and Pollution Prevention X

The project development and operation will generate some externalities which can result in acute pollution if mishandled: production of wastewater, used oil and sludge; emission of greenhouse gases; noises. Also. the permanent transportation, storage and treatment of quantities of heavy fuel oil (HFO), as well as the handling of any other hazardous materials may be source of risks which need to be monitored. The ESIA will propose pollution prevention mechanisms and actions us part of the F:SMS.

_PS 4: Co~ni~ Hcaltb, Safety, and Security x Regarding the nature of the project inputs, the suspected sources or risks are related to accidental spill of oil or polluted water, accidental fire occurrence during operation, and work accidents causing severe hann to workers. Occupational health issues may also be of concern. Thus, in addition to an Emergency Preparedness and Response guidelines to be endorsed under the ESAP, the ESMS will further provide safety measures to implement during the construction. PS 5: Land Acquisition and Involuntary Resettlement X

The project site is declared to be a property of the SENELEC and will be sold to the project developer; but. the environmental assessment will have to bring out the evidence (undjsputed title detained by SENELEC). and conclude that the site is currently not in IL<>e or occupied by a tierce-party. PS 6: Biodiversity Conservation and Sustainable X

Management of Living Natural Resources There is no vegetation coverage in the project si te location. The current land occupation picture shows human settlements and degraded land in the surrounding areas.

r!:S 7: Indigenous Peoples X

There are no indigenous people livinn. in the project area PS 8: Cultural Heritage X

There is no infonnation mentioning the Taiba Ndiaye zone to be part of an ancient kingdom or city likely

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Performance Standards (please explain why) I Yes I No I TBD to host archeological artifacts/wealth or cultural heritage. Public consultation during the ESIA reponing process may raise the existence of sacred sites or resources and, should this happen, the IFC Performance standard 8 will apply and recommendations proffered in the ESMS.

Ill SAFEGUARD PREPARATION PLAN

A. Target date for the Quality Enhancement Review (QER), at which time the ESRS would be disclosed and the PAD-stage ISDS would be prepared: July 2013

B. For Category Cor Category Fl projects that do not require an ESRS, the target date for preparing the PAD-stage ISDS: Not applicable

C. Time frame for launching and completing the safeguard-related studies that may be needed. The specific studies and their timing1 should be specified in the PAD-stage lSDS: The specific studies and their timing2 should be specified in the PAD-stage ISDS: An Environmental and Social Impact Assessment is currently underway by an international consultant, expected to be completed in early January 2013.

IV. APPROVALS

Sioned and submitJed bv:

Regional Safeguards Coordinator:

Com ments: Sector Manager:

Comments: Mcike van Ginnekcn

I Reminder: The Bank's Access to Information Policy requires I hat safc:guard-relatcc.l documents be disclosed before appraisal (i)

at the lnfoShop and (ii) in-country. nt publicly ncccssible locations and in 3 form and language thnt arc accessible to potentially all"ectcd persons. 2 Reminder: The Bank's Disclosure Policy requires that safeguard-related documents he disclosed before appraisal (i) ut the

lnfoShop and (ii) in-country. at puhlicly accessible locations and in a form and language that arc ace~siblc to poicntinlly affected persons.

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