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Environmental & Social Review Summary
This Environmental and Social Review Summary is prepared and distributed in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board of Director’s decision. Board dates are estimates only.
Any documentation which is attached to this Environmental and Social Review Summary has been prepared by the project sponsor and authorization has been given for public release. IFC has reviewed this documentation and considers that it is of adequate quality to be released to the public but does not endorse the content.
Latin America and the Caribbean
YARA COLOMBIA S A
Date ESRS disclosed
June 5, 2008
Last Updated Date
June 9, 2008
Invested: February 19, 2009
Signed: October 24, 2008
Approved: October 6, 2008
View Summary of Proposed Investment (SPI),
Category & Applicable Standards
Key Issues& Mitigation
Overview of IFC's scope of review
The review of this project consisted of appraising technical, environmental, health, safety and social information submitted by the company, and assessing the company’s operations through a field visit conducted by the project team. The environmental and social (E&S) appraisal team visited the company operations. The E&S team held meetings with the management staff at different departments of the company to discuss the E&S issues.
Abonos Colombianos S.A. (Abocol or the company) main production facilities are concentrated in the industrial area of Mamonal, Cartagena, Colombia. In addition, Abocol has bulk blending plants in two cities in central Colombia - Villavicencio and Espinal. The company also has four subsidiaries, as follows: FLIQ, a liquid and solubles facility in Bogota, Sociedad Portuaria Mamonal S.A. a private port adapted for 8,000 ton vessels in Cartagena, and two products distributors, one in Villavicencio –Fertillanos- and a second one in Costa Rica –Abocol Costa Rica-.
Abocol operations in Cartagena, which include:
- the South Plant which consist of an NPK (Nitrogen-Phosphorus-Potassium) Plant, two ammonium nitrate plants, and a calcium nitrate plant, and
- the North Plant which is conformed by two nitric acid plants NAN1 and NAN2, an ammonia plant, and the utilities complex, and
- a terminal designed to receive ships up to 8,000 tons of capacity used to received raw materials and dispatch products.
Abocol produces fertilizers (NPK, calcium nitrate, straights, blends, and foliars –liquid fertilizers) and industrial products (ammonia, nitric acid, and ammonium nitrate 83%) and commercialize straights fertilizers.
Abocol has approached IFC with a request for a corporate loan to support the company to expand its operations and to help funding improvements and upgrades to its existing operations in Colombia. As part of this project, Abocol will implement two projects.
The first project involves upgrading the technology of the current NPK plant, through the ODDA process maintaining its production capacity at 300,000 MTY of NPK solid granulated, producing the raw material for the production of 100,000 MTY of solid granulated calcium nitrate as by-product, and replacing 85% of mono ammonium phosphate usage with phosphate rock as raw material.
The second project involves:
- installing a nitric acid plant, with capacity to produce about 80,000 MTY,
- installing an ammonium nitrate solution plant with capacity to produce about 82,000 MTY, and
- building a calcium nitrate plant, with capacity to produce about 100,000 MTY of calcium nitrate solid granulated and 25.000 MTY of calcium nitrate liquid 100% concentration by 2009.
Identified applicable performance standards
While all Policy and Performance Standards on Social & Environmental Sustainability (April 2006) are applicable to this investment, IFC’s environmental and social due diligence indicates that the investment will have impacts which must be managed in a manner consistent with the following Performance Standards:
- PS1: Social and Environmental Assessment and Management Systems
- PS2: Labor and Working Conditions
- PS3: Pollution Prevention and Abatement
- PS4: Community Health, Safety and Security.
The Environmental Guidelines applicable to this project include:
- Environmental, Health and Safety Guidelines for Nitrogenous Fertilizers Manufacturing (April 2007)
- Environmental, Health and Safety Guidelines for Phosphate Fertilizers Manufacturing (April 2007)
- General Environment, Health and Safety Guidelines (April 2007)
Environmental and social categorization and rationale
This is a Category B project, according to IFC’s Environmental and Social Review procedures because a limited number of specific environmental and social impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. The following potential environmental, health, safety, and social issues were analyzed:
- Environmental and social management;
- Air emission, ambient air quality, and green house gas emissions;
- Water source and wastewater treatment;
- Workplace and ambient noise;
- Solid and hazardous wastes;
- Hazardous materials and operation hazard;
- Fire prevention and emergency response programs;
- Labor, and occupational health/safety (OHS) programs;
- Transportation safety; and
- Community relationships and consultation;
Abocol will implement the actions listed in the Environmental and Social Action Plan (ESAP) listed in Table 1 (enclosed in this document). The company will operate the existing plants and design and operate any new projects in accordance with the applicable IFC Performance Standards and Environmental Guidelines.
Key environmental and social issues and mitigation
- Environmental and Social (E&S) Assessment
Abocol has programs in place to prevent and reduce emissions, wastewater, soil contamination, and solid waste. The company also has preventive maintenance programs and applies a continuous improvement approach to enhance its E&S systems and ensure that all established procedures, preventive and emergency response programs, and requirements are duly followed. Abocol commissions environmental impact assessments whenever it builds new or upgrades existing operations and also conducts periodic monitoring and internal environmental, health and safety audits.
- Environmental, Health, and Safety (EHS) Management and Organization
Abocol has personnel dedicated to handle the EHS aspects of its operations. The environmental and the occupational health and industrial safety specialists in-charge respectively report to the legal and human resources division and the operations division. In addition, the company hires environmental consultants, as needed, to conduct studies such as the Environmental Impact Assessments (EIAs), monitoring, etc. To ensure sound EHS performance form the contractors, Abocol has procedures in place including contract clauses about EHS compliance, use of personnel protective equipment, work permits, report of incidents/accidents, etc. As part of this project, Abocol will establish a Corporate EHS structure to oversee the EHS performance of all its current and future operations and subsidiaries as indicated in the ESAP.
- Training, monitoring, and reporting
Abocol periodically conducts EHS training for all its own employees, as well as contractors and customers including safety audits, HAZOPs, job related risks, hazardous materials, fire prevention, etc. The company has also established monitoring programs to asses the EHS performance of its operations, and as needed contracts specialists to conduct some of the monitoring. Currently Abocol monitors air emissions, ambient air quality, ambient noise, workplace conditions (noise, dust) and number of accidents/incidents, at its own operations. Abocol prepares two monitoring reports per year for the local environmental authorities. Abocol will also conduct monitoring of ammonia and nitric acid throughout its plants to help identify sources of leaks and fugitive and ensure that employees are not exposed to harmful vapor levels.
Labor and Working Conditions
- Human Resources Policy and Management
Abocol has a Human Resources (HR) manager who is in charge of implementing the company’s HR policy and systems including work conduct, employee competencies models, mechanisms to handle and resolve employees and contracted laborers grievances, training, employees’ hygiene and safety aspects, union collective conventions, etc.
- Non-Discrimination and Equal Opportunity
The company is an equal opportunity employer. All hiring and promotions are merit-based.
- Protecting the Workforce
There is no child or forced labor at any of its operations. The company also ensures that the contract laborers, which mainly work on the raw materials, packaging, and port operations, are at least 18 years old. In addition to the compliance with in-country labor laws, the company provides additional benefits to its employees (i.e., extended health insurance to employees’ families, saving incentive and retirement fund, etc.) The company also ensures that indirect employees are covered with all social security requirements as per Colombian labor laws.
- Workers Organizations
Abocol generates approximately 1000 jobs of which approximately 300 are direct employees and the remaining 700 are contractors’ employees. As per Colombian law, all employees have the right of association and currently Abocol employees can be part of an industrial labor union named SINTRAQUIM. The labor union agreement in force was discussed and made effective for a period of four years, ending in December 2009.
Occupational Health and Safety (H&S)
Abocol offers appropriate medical services related to aspects derived from its operations and conducts periodic regular medical check-ups, including medical exams, laboratory, hearing and breathing capacity tests. For all direct employees, it provides uniforms and personnel protective equipment (hearing protection, duct protection masks, safety footwear and helmet, etc.) which is required to be used at all times. Key H&S programs established include, assessing employees’ general and occupational health, evaluating work-related risks and prevent occupational impacts including exposure to harmful gases, monitoring workplace areas, maintaining records of accidents and incidents, implementing corrective measures to reduce negative EHS impacts, etc.
Pollution Prevention and Abatement
Abocol conducts all operations in ways that minimize environmental impacts by reducing the possibility of leaks and accidental spills. Abocol puts strong emphasis on conducting preventive and corrective maintenance. As indicated in the ESAP, the company will develop standardized protocols and procedures and update as applicable existing ones for the new projects.
- Land and natural environment
All the company’s operations are located in assigned industrial zones. None of its current operations are located in either protected areas or in preserved national parks. Abocol is committed to ensure that no new site or operation will be located in any of the above mentioned sensitive areas.
- Raw Materials and Resource Consumption
Natural gas, the main raw material for the production of ammonia arrives through a pipeline to the plant from a gas distributor. The water needs for process and domestic purposes which is supplied by the local water company, Acuacar, is treated in an on-site water treatment plant prior being used. The plant generates its own steam and obtains power from its own 25 MW capacity power co-generation plant which supplies a 100 % of Abocol energy needs.
Others materials such as phosphoric rock and limestone are bought domestically. Potash and phosphates are imported.
- Air Emissions, Ambient Conditions, and Liquid Effluents
At the North plant, Abocol has two nitric acid plants (NAN1, NAN2) and an ammonia plant. NAN1 control its air emissions with absorption towers and NAN2 with a catalytic system. The NAN plants emit nitrous oxide (N2O), nitrogen oxide (NOx), ammonia, and particulate matter. Abocol is developing a project to capture the N2O and gain carbon reduction credits. The NOx emissions of both plants are in compliance with Colombian Law requirements. As part of this project, the company will conduct stack testing of ammonium and particulate matter at the NAN1 and NAN2 plants which are not currently measured and as needed identify the measures to be implemented to control such emissions to IFC acceptable levels as indicated in the ESAP.
At this site, Abocol will build a new nitric acid plant (NAN3) which will have NOx and N2O emissions and a new ammonium nitrate plant (UNA3) with particulate emissions.
These projects will be designed and operated in compliance with Colombia Law and IFC requirements.
The South Plant, which has the NPK, and calcium nitrate (NICA 1) plants, has three stacks equipped with a cyclone and a gas scrubbing system to control the releases to the atmosphere. The company currently measures emissions of particulate matter, ammonium, and NOx and the reported concentrations are in compliance with local requirements but above the IFC requirements. As part of this project, Abocol will:
- design and implement a control system to reduce these emissions;
- conduct emissions stack testing of chlorhidric acid and fluorhidric acid emissions; and
- implement controls, as needed, to achieve compliance of these parameters with IFC requirements.
As part of this project, Abocol will:
- switch to a new process at its NPK plant (ODDA) which will generate carbon dioxide (CO2) emissions and
- a new calcium nitrate plant (NICA2) which will generate NOx, and CO2 emissions.
These plants will be designed and operated ensuring compliance with the Colombia Law and IFC requirements.
Even though, Abocol has programs to control fugitive emissions and leaks from equipment and transfer points, the company is establishing a program at both, the North and South plants to enhance maintenance and significantly reduce its fugitive emissions.
For the Port, Abocol is evaluating alternatives for the replacement of conveyor belts covers, to control the emissions of particulate matter during unloading.
Recently, Abocol commissioned a five days study to assess the air quality conditions of its area of influence. It measured particulate material, NO2, and SO2. The results indicated an overall good quality for both the North and South plants and acceptable quality for the port, as per the Colombian regulation. As part of this study, it also conducted an air dispersion NOx assessment from the Nitric Acid plant. The results indicated that the concentrations at the four sampling points selected (i.e., two closed communities, a more distant community and a nearby industrial refinery) where below the 100 ug/m3 acceptable level. As part of this project, Abocol will continue measuring the air quality conditions of the area of influence where it operates.
The North plant generates process wastewaters, and cooling waters. The process waters are neutralized prior being discharged to Cartagena’s Bay through a storm water channel. To prevent accidental acidic or basic release the channel has a pH alarm to indicate high concentrations. In addition, there are oil traps in the compressors area and along the channel to prevent oil releases to the Bay. The effluent parameters measured after treatment include pH, ammonia, total nitrogen and total suspended solids. These concentrations are in compliance with both, local and IFC requirements. The domestic effluents are conducted to well-managed septic tanks. The new nitric acid and ammonium nitrate plants to be build at the North plant site will have independent treatment systems but will be released to the same final discharge. It is anticipated these effluents will be in compliance with the IFC requirements.
The South plant, which releases effluents from the NPK plant and the calcium nitrate (NICA 1), collects them in an impermeable lined sedimentation lagoon where the solids are separated from the liquid phase. The clear liquid is send back to the process and the solids are collected, dried, and also incorporated back into the NPK process. The domestic effluents are conducted to well-managed septic tanks. The new calcium nitrate plant (NICA 2) to be build at the South plant site will have an independent treatment system and will be also reintegrated to the process. Thus the South plant is a zero industrial effluents operation. In addition, the Nitric acid 1 (NAN1) will also recover process condensed vapor.
At the port, Sociedad Portuaria Mamonal has control programs in place to ensure there is no discharge of oil, wastes or bilge waters by the ships into the Bay, these programs are enforced through the terms and conditions issued to each vessel
- Solid Wastes and Hazardous Wastes
Abocol has a solid wastes management program that includes identification, classification, storage, and final disposal. Hazardous wastes are segregated and stored in enclosed areas, with low permeable (i.e., concrete) floors. The main solid wastes generated are packing wastes fluorescent lamps, oil contaminated residues, and domestic wastes. These residues are collected and handled by government authorized third parties. Abocol is currently seeking companies that can reuse/recycle the waste catalysts from the ammonia manufacturing which until now have been encapsulated and stored within Abocol premises. There are neither transformers nor capacitors, containing poly chlorinated biphenyl (PCB), at any of its operations.
The new projects will generate the same type of residues generated until now. The residue to be generated at the new NICA2 will be integrated back into the NPK process as it is done at the NICA 1 plant. The nitric acid and the ammonium nitrate processes do not generate solid residues. Thus the company will extend its practices and enhance handling and storage capacities to handle the new volumes to be generated. In addition, Abocol is developing a plan to reduce the generation of residues. In particular, it is strengthening the preventive maintenance programs to reduce the generation of leaks. Hence reducing the amount of residues generated during maintenance. Construction debris to be generated during the construction phase of the new projects will be also properly handled by Abocol.
- Hazardous Materials
Abocol has a system to handle hazardous materials which begin at the buying stage when the characteristics of all materials are identified and handling processes established. For intermediate and final products, Abocol also has procedures by which also identifies the characteristics of the materials and establish prevention and emergency response procedures for storage, transport, and final users.
Ammonia, nitric acid, sulfuric acid, phosphoric acid, potassium chloride, phosphoric rock, ammonium sulfate, magnesium oxide, etc and diesel are stored at both plants as raw materials, and intermediate and final products. The liquid hazardous materials are stored in tanks on concrete floors and the majority of them have secondary containment walls. As part of this project, Abocol will install double containment walls to all its tanks to eliminate risk of soil contamination from accidental spills or leaks.
There are two large ammonia storage tanks, 3,500 MT each, which have the needed safety measures in place (i.e., pressure safety valves, fire protection net coverage and pressure and temperature control devices etc.)
- Operational Safety
Abocol has established procedures to ensure the safety of its operations including back up operational control systems to ensure quick response to potential process deviations, installation of continuous gas leak detectors, sound alarms, and permanent pressure and temperature controls, conducting HAZOPs and implementing the recommendations, and conducting rigorous operations training, among others.
It also has detailed procedures for liquids loading and unloading. Specifically, the company will build an additional liquids filling and loading plant at the North plant to enhance safety during these operations. As part of the NICA2 project, it will also acquire specialized equipment to handle containers within the finished product yard.
- Fire and Spill Prevention and Emergency Response
For each North and South plants, Abocol has developed emergency response and contingency plans. Key elements of these plans include procedures for internal/external communications, response organizations/contacts, neighboring plants involved in the Mutual Aid plan of the Mamonal Complex, list of response equipment and periodic calibration and monitoring frequencies, etc. Abocol will upgrade as needed these plans as a results of the new projects. Abocol is also in charged of the emergency response at the port.
Abocol also has trained fire/emergency response brigades available at all times and approximately 75% of the employees are already trained for first response to incidents with hazardous materials. It also conducts periodic emergency response drills and has installed fire prevention/response equipment such as an ambulance, a fire network, alarms, sprinklers, signals, hydrants, 7,500 m3 fire water tank, and extinguishers throughout the plant.
- Green House Gases (GHGs)
Abocol management realizes that greenhouse gases (CO2 and N2O) are both a serious global problems but that there are significant business opportunities in the form of carbon finance. Abocol is currently implementing a project to reduce by 80 to 90% the levels of N2O emissions from the production of nitric acid at the company’s two existing nitric acid plants in Cartagena and it anticipates selling the carbon credit reductions generated by this project in the carbon finance market.
Protection of Cultural Property
None of the projects that the company is implementing are located in areas where cultural resources, such as sites of archaeological value, are likely to be found.
Abocol has programs in place for land acquisition including willing buyer/willing seller and ensuring that all procedures involved in the acquisitions follow the local laws and requirements.
Community Health, Safety and Security
Abocol operations are built to reduce negative risks to the nearby communities. In addition, the company has established maintenance and monitoring programs, EHS training for all its employees and conducts periodic emergency response drills including the nearby communities and other industries in the industrial complex. Grievances from the community are channeled through the organizational structures the local authorities have in place and directly by the company. Once received by the company, community grievances are promptly handled and resolved. The company maintains records of the grievances and response actions.
The liquid (i.e., nitric acid, ammonia, ammonium nitrate) and solid (i.e., NPK, single and mixed fertilizers) products are transported both by road in trucks and tankers and by ship. The road transportation is conducted through contracted transportation companies, mostly hired by the customers. The ships arrive to Abocol’s own terminal and also to a third party (Ecopetrol) terminal through which Abocol exports ammonia. The plant is connected to Abocol’s port through a conveyor band and to the third party terminal through a 2 km pipeline.
Abocol has a transportation safety program that includes check-up of trucks/tankers prior to collection of products, safety driving, emergency response, and safety risks training programs, etc. As needed, Abocol will update this program as per the new demands of the new projects.
- Product Stewardship
Abocol is committed to produce safe products, disclose the inherent risks in the use and handling of its products, and share the good environmental and safety practices it applies in its industrial sites. Abocol, as needed, publishes the information regarding the new projects among employees, clients, and communities.
The company generates local employment and is committed to fill all unskilled employment positions with local persons and to use local suppliers of goods and services whenever possible. It also has a program to help its buyers to better apply its products by identifying the characteristics of soils, thus expecting its clients obtain more nutritional and better yields.
IFC will evaluate the project’s compliance with the applicable environmental and social requirements during the lifetime of the project through the following methods:
- Review of the annual monitoring reports (AMRs);
- Follow the implementation of the actions contained in the ESAP;
- Follow the performance environmental health, safety, and social performance; and
- Conduct periodic site supervision visits will also be conducted, if necessary
Client's community engagement
Abocol’s policy is to keep in close and open communications with local communities and authorities. The company supports projects to improve the quality of life in communities located within the area of influence of its operations. The company delivers its programs through the Fundación Mamonal which is been conformed by the industries in the industrial complex. The Fundación engage with the communities about emergency response initiatives. Abocol is interested in better structuring its community outreach programs and has agreed to keep IFC abreast of the development of such programs.
Local access of project documentation
Name: Mónica Ayazo
Title: Environmental Control
Address: Zona industrial de Mamonal Km. 11
Phone Number: 575 6688301
The environmental documentation will be disclosed for a period of 30 days at the company website:
IFC supports its clients in addressing environmental and social issues arising from their business activities by requiring them to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities.
In addition, Affected Communities have unrestricted access to the Compliance Advisor Ombudsman (CAO), the independent accountability mechanism for IFC. The CAO is mandated to address complaints from people affected by IFC-supported business activities in a manner that is fair, objective, and constructive, with the goal of improving environmental and social project outcomes and fostering greater public accountability of IFC.
Independent of IFC management and reporting directly to the World Bank Group President, the CAO works to resolve complaints using a flexible, problem-solving approach through its dispute resolution arm and oversees project-level audits of IFC’s environmental and social performance through its compliance arm.
Complaints may relate to any aspect of IFC-supported business activities that is within the mandate of the CAO. They can be made by any individual, group, community, entity, or other party affected or likely to be affected by the environmental or social impacts of an IFC-financed business activity. Complaints can be submitted to the CAO in writing to the address below:
Compliance Advisor Ombudsman
International Finance Corporation
2121 Pennsylvania Avenue NW
Washington, DC 20433 USA
Tel: 1 202 458 1973
Fax: 1 202 522 7400
The CAO receives and addresses complaints in accordance with the criteria set out in its Operational Guidelines which are available at: www.cao-ombudsman.org
Availability of Full Documentation