The World Bank and the G-7:
Still Changing the Earth's Climate for Business
1997-98

Authored by the Sustainable Energy and Economy Network (Institute for Policy Studies, USA) and the International Trade Information Service (USA)

Version 1.3, December 1998

A. OIL AND GAS PRODUCTION

The world's most-recently discovered and lucrative oil and gas fields seem to be concentrated in many of the world's most conflict-riddled regions. Chad, Nigeria, the Amazon, and the Caspian Sea are places visited by political havoc and ecological destruction. As new drilling grounds, they represent flashpoints that will determine the course of the oil and gas industry: Transnational corporations are eager to develop these regions, but fear political risks, and seek -- even demand, in the case of Chad -- multilateral bank partnerships. The fates of these developments, often, rest with the World Bank's directors.

When the Bank's directors decide in favor of exploration and development of these hydrocarbon frontier regions, they are helping to generate wealth for project owners, like Shell, Enron and the government of Chad -- entities whose human rights track records are not exactly spotless. And, by aiding exploration of untapped reserves, they are guaranteeing pollution in previously-unspoiled ecosystems, and gigantic new carbon emissions.

Since the Earth Summit, the World Bank has committed $3.4 billion toward oil and gas exploration and distribution projects that we estimate will, over their lifetimes, help generate 26.8 billion tons of CO2 emissions. Despite rising concern over this gas' contribution to climate change and the significant impact climate change will have on the poorest in developing countries, the Bank remains undaunted.

A 3,100 kilometer pipeline to pour natural gas from Bolivia -- through the Amazon -- into the cities of Brazil was the only oil or gas development newly-funded by the Bank from June 1997 to September 1998, to the tune of $310 million. But plenty of projects are on the Bank's hotplate. Pending oil and gas commitments of $840 million could add a half-billion tons of future CO2 emissions to the Bank's portfolio, and support billions of tons of emissions from projects already financed by the Bank.

Africa is a burgeoning focus, with the Bank poised to devote over $830 million toward grabbing gas from Nigeria's vast hydrocarbon fields, inaugurating oil drilling in Chad, and developing a gas field in Tanzania. Millions of tons of black gold beneath the Caspian Sea will soon flow to Georgia and beyond via a new pipeline, if the Bank's board affirms its tentative $200 million package.

The World Bank's oil and gas portfoliio seems to have taken a reprieve from Russia, after much of its earlier lending went unspent due in part to opposition to Bank-mandated equipment imports Since 1992, the Bank had earmarked $1 billion in financial aid to Russia's oil and gas industry, nearly one-third of the Bank's oil and gas extraction and distribution funding since the Earth Summit.

AZERBAIJAN to GEORGIA

TYPE OF INDUSTRY: (pending) Oil field development and pipeline
SUBSIDIZED PROJECT: Azerbaijan-Early Oil Development
LOCATION: Azerbaijan sector of Caspian Sea to Georgia (with ultimate continuation to Turkey)
OWNER: (project operator) Azerbaijan International Operating Co. (a consortium of Amoco, Exxon, Lukoil, Turkish Petroleum Co., Unoco, BP, Statoil (Norway), the State Oil Company of Azerbaijan, Ramco Hazar Energy (UK), and Delta Nimir Khazar Ltd.
G-7 TNC INVOLVEMENT: Amoco, Exxon, Unocal (all three based in the U.S.), Lukoil (Russia), and the Turkish Petroleum Company are seeking financing for this project. Dozens of other TNCs are potential suppliers of oil from other Caspian Sea fields.
WORLD BANK AGENCY: IFC
AMOUNT OF FINANCING: $200 million of at least $1.3 billion
PROJECTED BOARD DATE: April 30, 1998 (reportedly delayed to mid-May 1998 or later)
RESERVES/PRODUCTION: The pipeline would tap into all Azeri oil fields, which hold an estimated 20 billion barrels of proved reserves.
WORLD BANK DESCRIPTION: "The Project involves the: (i) refurbishment of an existing oil platform (Chirag-1), located about 75 kilometers off the coast of Azerbaijan in the Caspian Sea, construction of new subsea pipelines, and drilling of development/water injection wells, (ii) construction of an oil receiving terminal at Sangachal on the Caspian Sea coast of Azerbaijan, (iii) construction of an oil export terminal at Supsa on the Black Sea coast of Georgia, and (iv) completion of two oil export pipelines (through rehabilitation of existing pipelines and new construction): one North from Sangachal to the Russia/Azerbaijan border, and one West, from Sangachal across Azerbaijan and Georgia, terminating at Supsa. The Early Oil Project involves the development of part of the Chirag field, and is the first step in the full development of the group of three fields known as Azeri, Chirag and deep-water Gunashli. Production from the Early Oil Project is expected to reach 105,000 barrels per day(bpd) by the year 2000. Azerbaijan will also receive significant quantities of associated natural gas from the Project, which will reduce the gas deficit in the country...Georgia will receive the benefits of substantial investment in export pipeline and terminal infrastructure, and will also obtain transit fee income from oil transported across its territory. Russia has signed a contract to export oil from Azerbaijan and will also receive tariff income from transport of oil from the Project. IFC's role in this Project is to: (i) provide long term financing, which is not currently available in Azerbaijan or Georgia, (ii) mobilize financing from international commercial banks, and (iii) mitigate cross-border and other perceived political risks." (IFC PID, Project No. 007271)
ENVIRONMENTAL/SOCIAL ASPECT: Category A. "Environmental areas of concern with respect to the project include: existing hydrocarbon contamination to soil, surface water and ground water along existing pipelines and at sites for new facilities; knowledge of terrestrial resources as well as cultural properties and significant natural habitats; oil spills; the management of produced water and gas and worker health and safety." (IFC PID, Project No. 007271) Douglas Norlen of the Pacific Environment and Resources Center has reviewed the IFC's environmental assessment in depth, and writes:

"The Bank focuses primarily on the Appraisal Drilling and Early Oil phases, which is a small subset of the much larger eventual project, much less of additional projects in the area. Hence, the public and IFC board members are not provided with a true evaluation of the overall impacts of drilling discharges and produced waters, of pipeline safety, of risks of tanker accidents associated and other key aspects of the overall project. Also, the EIAs indicate that the oil spill risk assessment work is incomplete, and they state that the possible effects of oil spills on the abundant sea bird population in Azerbaijan coastal waters will be studied further in something called the "EIA for the Early Oil Scheme." Regarding the potential impacts of drilling discharges, produced waters and spills, the EIA rationalizes that 'it has often been stated and is a sound maxim that unless pollution effects occur or are likely to ocur at the population level, it is arguable whether pollution effects can truly be said to have occurred.' While this is true in the strict sense of population dynamics, it is absurd for the authors to suggest that there is no environmental impact unless an overall species population is negatively effected. To do so is to suggest, for example, that the Exxon Valdez did not have much environmental impact to the pristine coastal environment in Alaska since no species were actually driven into extinction. If extended to people, the authors' reasoning would seem to suggest that effects of industrial pollution have not occurred unless it threatens the entire human race with extinction. "

Project Profile

Early in this century, Azerbaijan produced more than half of the oil in the world from the shore of the Caspian Sea. After the onshore deposits ran empty, the oil search moved out to sea, and now, the region is one of the world's oil exploration hot spots.

The World Bank is deeply involved in promoting the sale, development and export of Azerbaijan's oil fields, most of which lie within a badly polluted part of the Caspian Sea. In 1995, the Bank's IDA extended $21 million in credit toward the development of the Guneshli oil field by BP (17% Owner), Amoco (17%), Unocal (10%), Pennzoil (5%), Itochu (4%), and Ramco (UK, 2%).

In recent years, the Bank has lent $7 million for preparation of a massive pipeline from Baku, Azerbaijan, to Turkey via Georgia, and, now, it is considering extending another $800 million in credit toward the same pipeline.

In April 1998, as the Board prepared to consider approving the pipeline project, the prospects of swift approval faded as the Caspian Sea countries (Russia, Kazakhstan, Azerbaijan, and Turkmenistan) continued territorial disputes over oil field Ownership. Russia also voiced opposition to Turkmenistan's plans to run an underwater pipeline, feeding into Azerbaijan's pipeline to Georgia, on ecological grounds. The grounds: earthquakes of magnitude 8 on the Richter scale have been recorded on the pipeline's proposed route.

At the same time, the IFC has raised concerns about the need to replace badly leaking lengths of an existing pipeline from Baku before the rest of the project proceeds. And, there is some dispute between project Owners over financial arrangements. All of this, according to Douglas Norlen of the Pacific Environment and Resources Center, has caused a delay in the IFC board vote until mid-May and could delay the project for two more years.

Oil Production in the Caspian Sea

From the production points to the pipeline routes, the quest for Azeri oil is marked by fierce turf battles between corporations and governments. The prize is up to 20 billion barrels of oil reserves in and around the Caspian Sea. In addition, Russia, Kazakhstan, Iran and Turkmenistan also hold considerable reserves in the Caspian.

G-7 corporations have fond regard for the Azeri government. "You've got a government, from the president down, that understands what it takes to do business with the West," said Robert Ebel, an analyst at the Center for Strategic and International Studies (Washington D.C.) in March 1997.

"Nearly everyone in the oil business around the world knows their way to Baku (capital of Azerbaijan)," said T. Don Stacy of Amoco.

According to the Dallas Morning News, "the Clinton administration's energy policy-makers have worked feverishly behind the scenes to support the efforts of Western companies seeking to unlock the Caspian's oil riches - even though the administration is prevented by law from providing Azerbaijan with a penny of aid because of its simmering conflict with Armenia."

President Clinton's work has helped to ensure that G-7 corporations control the majority of the oil that lies within Azerbaijan. G-7 companies own two-thirds of the oil in the Azeri-Chirag-Guneshli field, one of the world's largest oil reserves. They also own majority shares in at least three other major joint ventures.

* AIOC (Azeri, Chirag and Guneshli fields)

Called "the contract of the century," this first oil exploitation joint venture in Azerbaijan was formed in 1994, when 11 companies created the Azerbaijan International Operating Co. (AIOC). The AIOC will develop the Azeri, Chirag and Guneshli fields in the Caspian Sea at an estimated cost of $7.4 billion. The three fields hold an estimated 4.1 billion barrels of oil, rivalling some of the world's largest reserves.

This venture is 64.6% controlled by G-7 corporations. Investors include: British Petroleum (U.K., 17.1%), Amoco Corp. (U.S., 17%), State Oil Co. Of Azerbaijan Republic (SOCOR, 10%), Lukoil (Russia, 10%), Unocal (U.S., 10%), Statoil (Norway, 8.6%), Exxon (U.S., 8%; purchased 5% from Socar in 1995, 3% from Pennzoil in 1996), TPAO (Turkey, 6.8%), Pennzoil (U.S., 4.8%), Itochu (Japan, 3.9%), Ramco (U.K., 2.1%), and Delta-Nimr (Saudi Arabia, 1.7%).

G-7 equipment and service suppliers include East-West Helicopters, an Azerbaijan-Canada joint venture; McDock and McShelf, Azeri-US joint ventures for supply bases; and Itochu, which has conducted seismic surveys on the shelf. In addition, Azerbaijan has agreed to have Conoco (U.S.) rehabilitate wells and further develop the Guneshli field.

"Our participation in the Azerbaijan project is a key element in our growth strategy," said Marty Miller, a Unocal vice president, in 1996.

In January 1997, the government of Turkmenistan claimed sovereignty over two of AIOC's three Caspian oil fields. Conoco is also interested in the Guneshli field: it is hoping to develop concessions that are not controlled by the AIOC.

* Karabakh field (CIPCO)

In November 1995, four companies agreed to develop the Karabakh field, which holds between 550 million and 1.1 billion barrels of oil, under a joint venture called the Caspian International Petroleum Company (CIPCO). The $1.7 billion project's investors include: Lukoil (Russia, 32.5%), Agip (Italy, 30%), Pennzoil (U.S., 30%), and SOCAR (7.5%). Ramco (U.K.) claims it has the right to 5.25% of the field.

* Dan-Ulduzu and Ashrafi fields

In 1996, four foreign companies made a deal with SOCAR to explore and develop the Ulduzu and Ashrafi fields, next to the Karabakh field. The corporations in the $1.5 billion deal include: Amoco (U.S., 30% stake), Unocal (U.S., 25.5%), Itochu (Japan, 20%), and Delta-Nimir (S.Arabia, 4.5%).

* Shakh Deniz

In June 1996, British Petroleum, Statoil and Elf (France) signed a production sharing contract for the Shakh Deniz offshore field, which may contain up to 5 billion barrels of liquids.

The Pipeline

The initial two pipelines from Azerbaijan's oil fields were planned to run to the Black Sea ports of Novorossiysk, Russia (via Grozny, Chechnya), and to Supsa, Georgia, beginning in August and Decmber 1998, respectively. The first oil will flow from the Bank-financed Guneshli field. In December 1996, the AIOC chose seven final candidates for the Supsa pipeline, including Saipem of Italy, which already won the contract for building a pipeline from the AIOC fields (including Guneshli) to the mainland. The pipes are to be supplied by Itochu (Japan).

These smaller pipelines will be supplanted by one or two larger pipelines, for which Russia (via Chechnya) and Turkey (via Georgia) are vying for consideration. The pipeline will handle up to 100 million metric tons of crude annually, and may eventually extend across the Caspian to the Kazakhstan oil fields.

It appears that the World Bank favors the Georgia-Turkey route. In September 1996, the World Bank (IBRD) approved a $5 million loan for technical assistance in support of the proposed Baku to Ceyhan, Turkey, pipeline. G-7 transnationals Shell and Chevron have formed a tentative joint venture to build the pipeline to Ceyhan.

Turkey argues for its proposed Mediterranean port destination as a means of avoiding the crowded and dangerous passage of oil tankers through the Bosporus Strait. "Not a drop of oil will pass through the Bosporus" if the pipeline project goes to Russia, warned Turkey Prime Minister Tansu Ciller in 1995.

Sources: Dallas Morning News, March 10, 1997; Journal of Commerce, Feb. 15, Dec. 12, 1996, Jan. 21, 29, and Feb. 5, 1997; United Press International, Oct. 2, 1995, Oct. 22, 24, and Nov. 4, 1996; Inter Press Service, July 30, 1996; PR Newswire, July 30, 1996; World Bank PID, PID GEPE44830, April 30, 1997; World Bank News, Sept. 19, 1996; Houston Chronicle, Nov. 11, 1995; Offshore, Feb. 1997.; Oil and Gas Journal, Dec. 9, 1996; World Oil, August 1996; Radio Free Europe/Radio Liberty, April 20, 1998; IFC PID, Project No. 007271.

BOLIVIA/BRAZIL

TYPE OF INDUSTRY: Gas Pipeline (3,110 km)
SUBSIDIZED PROJECT: Brazil-Gas Sector Development Project
LOCATION: Rio Grande, Bolivia, to Sao Paulo, Brazil
OWNER: (borrower) Brazilian Gas Transport Company (TBG), (implementing agency) TBG (Rio de Janeiro, Brazil)
G-7 TNC INVOLVEMENT: "The private sector is directly involved in the project through British Gas, BHP Petroleum, and El Paso which own 25 percent of the equity of the Brazilian Company that was created to transport the gas. The Bolivian transport company is privately owned with Shell and ENRON as major stockholders..." (World Bank Press Release December 18, 1997) Many of these same companies operate oil and gas fields in Bolivia. Brown & Root-Murphy (U.S.) is part of a consortium of four companies building the 1,259-kilometer leg of the pipeline from northern Brazil to a refinery in Sao Paulo state. Bechtel (U.S.) is also heavily involved in the overall project.
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING (estimated total cost): $130 million (IBRD), $180 million (IBRD partial credit guarantee) of $2 billion financing requirement (20% Bolivian, 80% Brazilian). In December 1997, the Inter American Development Bank approved a $220 million loan toward this project. Other funding is expected from AFC ($130 million), Corporacion Andina de Fomento ($50 million), BNDES ($177 million), European Investment Bank ($60 million) and the Japan Export Import Bank ($234 million). In FY1996, the IDA provided a $10.6 million credit toward the restructuring of Bolivia's hydrocarbons sector.
DATE APPROVED: December 17, 1997
RESERVES/PRODUCTION: The "capacity of the pipeline will be 30 MMcm/d, which compares with a gas supply ceiling of 16 MMcm/d specified in the gas import agreement with Bolivia." (World Bank PID BRPA6549, May 7, 1997) Bolivia has 4.5 trillion cubic feet of natural gas proved reserves. "Given that current Bolivian reserves will not meet the export demands generated by the project, it is expected that the project will create a significant incentive for gas exploration in Bolivia," declared the World Bank. An energy consultant said that Bolivia would need to discover 2.3 trillion cubic feet in new gas reserves to fully supply Brazil in the 20 year contract. If that does not work, Wood Mackenzie analyst Matt Shaw told the Oil Daily, gas may be piped from northwest Argentina via Bolivia to Brazil.
WORLD BANK DESCRIPTION: "The loan will (a) finance the construction of a gas pipeline from Bolivia to south-east/south Brazil; and (b) support the reform of the gas sector in Brazil to allow an increase in private participation." (World Bank MOS, February 4, 1998) ENVIRONMENTAL/SOCIAL ASPECT: In December 1997, just before the Bank approved its part of the pipeline financial package, its representatives and other pipeline proponents signed an agreement with Indian leaders in Bolivia to support social and environmental programs in affected communities. The Bank has said that "[w]hile the majority of the pipeline route in Bolivia and Brazil is in an area of low environmental sensitivity and thus the probability of significant adverse environmental impacts are expected to be minimal, the pipeline will cross sensitive environmental ecosystems such as the Pantanal, the Gran Chaco and Santa Cruz La Vieja National Parks (Bolivia) and Mata Atlantica Biosphere reserve and Aparados da Serra National Park in Brazil." NOTE : This project is the largest ever investment in Bolivia.
SOURCES: World Bank MOS, February 4, 1998; World Bank PID BRPA6549, May 7, 1997; IPS/ITIS, Changing the Earth's Climate for Business; LatinFinance, March 1996; Platt's Oilgram News, Sept. 15, 1992; Pipe Line & Gas Industry, January 1997; Inter Press Service, May 20, 1997; PR Newswire, December 5 and 6, 1996, May 19, 1997; Facts on File World News Digest, Dec. 19, 1996; Houston Chronicle, Dec. 6, 1996; Oil & Gas Journal, April 6, 1998; The Oil Daily, Dec. 9, 1997, Dec. 23, 1997; World Bank PID BRPA6549, May 7, 1997.

CHAD/CAMEROON

TYPE OF INDUSTRY: two oil field developments (Chad), 1,100 km buried pipeline, mini-refinery, diesel power plant, export terminal facilities (Cameroon)
SUBSIDIZED PROJECT: Doba and Sedigi oil fields, pipeline to Cameroon
LOCATION: Sedigi oil field, Doba basin oil fields (Chad) to port of Kribi, Cameroon
OWNER: (borrowers) Republics of Chad and Cameroon; (implementing agencies) subsidiaries of Exxon, Shell, Elf.
G-7 TNC INVOLVEMENT: Pipeline and Doba, Sedigi production consortium owned by Exxon (40%), Shell (40%) and Elf (20%, France). Exxon will operate the pipeline, and has contracted a consortium led by Willbros Co. (U.S.) and SPIE-Capag (France) to carry out the pipeline construction. Wackenhut (U.S.) to provide security for the pipeline. Saur (France) interested in acquiring 51% of state electricity network. Mitsubishi (Japan) is interested in investing in the diesel power plant.
WORLD BANK AGENCY: IDA, IFC
AMOUNT OF FINANCING (estimated total cost): at least $370 million of $3.5 billion. According to Africa Energy & Mining, the "Bank group is still ready to put up $1 billion in loans towards the $1.8 billion Doba-Kribi pipeline project." In mid-1998, the IDA will consider a $120 million credit to, and the IFC will consider a $250 million investment in the pipeline project. The estimated total for the project is $3.5 billion; $1.6 billion for development of Chad oil fields and $1.9 billion for the pipeline and marine facilities. (World Bank PID TDPE44305 May 15, 1997) The IDA is also considering a $12 million to $15 million loan for reform in the Chad government's management of the oil sector and a separate loan for production in the Sedigi oil field, a refinery, and a 16 megawatt diesel power plant in Ndjamena, Chad's capital. (Africa Energy &Mining, May 7, 1997)
PROPOSED BOARD DATE: Mid-1998
RESERVES/PRODUCTION: The Doba basin (in which the Kome, Bolobo and Miandoum fields lie) reportedly holds proven reserves of 900 million barrels; Sedigi holds an additional 150 million barrels. (Africa Review World of Information, Feb. 1997)
ENVIRONMENTAL/SOCIAL ASPECTS: Category A. The World Bank's environmental assessment asserts that "resettlement plans will be implemented for displacement of households from farm lands. The impacts on biological resources include removal of vegetative cover and shade canopy increasing soil surface temperature, decreasing moisture content, killing soil organisms and increasing potential for erosion in the oil field development and along the pipeline. A buffer zone will be set up to minimize the impacts. The project will also incorporate environmental measures to avoid potential disturbance to aquatic resources from oil spills. Induced access to undisturbed wooded savanna and riverine vegetation during construction and operation may lead to reduction of natural resources. This will be mitigated by controlling unauthorized use of pipeline route during construction. Increased peak flows and sediment loads of small tributaries of drainage will be corrected by draining surface runoff to more than one tributary. Disturbances to existing local supply wells caused by continuous withdrawal of project water supplies will be reduced by staggering project water supply wells. Reduced water quality caused from wastewater discharge will be corrected by treating sanitary wastewater in compliance with the World Bank effluent guidelines." (World Bank, "Chad, Cameroon - Petroleum Development and Pipeline Project: environmental assessment," abstract of Report E202, Nov. 1, 1997)
NOTES: Chad "is endowed with petroleum resources which have not been exploited. The development and export of Chad's substantial petroleum reserves in the southwestern part of the country (Doba) could significantly improve its development prospects." (World Bank PID, Project ID TDPA534, April 4, 1995)
SOURCES: World Bank PID, Project ID TDPA534, April 4, 1995; Africa Review World of Information, Feb. 1997; Africa Energy & Mining, May 7, 1997; World Bank PID TDPE44305 May 15, 1997.

TYPE OF INDUSTRY: Technical and capacity support
SUBSIDIZED PROJECT: Petroleum Sector Management
LOCATION: Chad and Cameroon
OWNER: (implementing agency) Ministry of Mines, Energy, Hydraulics, and Petroleum
G-7 TNC INVOLVEMENT: SAUR, Mitsubish and Hyundai possibly interested (Africa Energy & Mining May 7, 1997)
WORLD BANK AGENCY: IBRD/IDA
AMOUNT OF FINANCING: $12 to $15 million
PROPOSED BOARD DATE: No date set, no PID yet. Appraisal mission scheduled for July 1998.
RESERVES/PRODUCTION: This project is support for Chad-Petroleum Develoment and Pipeline Project and is therefore based on the same reserves.
WORLD BANK DESCRIPTION: "The project will (a) provide technical assistance to the government for the supervision of the Doba Oil Project, (b) increase the government's capacity to manage and promote the petroleum sector, and (c) provide capacity strengthening in the appropriate use of oil reserves." (World Bank MOS February 4, 1998)
SOURCES: Africa Energy & Mining May 7, 1997; World Bank MOS February 4, 1998

Discussion

"Africa's hinterland oil, whose potential is not confined to Chad or Sudan, bears heavy political risks, unlike offshore operations. But it will be the next promised land if the Doba project goes through without hitch."
-- Africa Energy & Mining, Dec. 4, 1996

In 1975, amid fighting between rival ethnic groups, Chevron (US) discovered oil in the Doba region of Chad. Subsequent years of exploration have revealed an estimated 900 million barrels of high-quality oil in the Doba fields. More oil lies in Chad's Sedegi fields. As a result, one of the most impoverished countries in the world is now the target of a global oil rush. Exxon is leading the charge, and expects to pump the first oil from Chad in the year 2000. Oil may flow at a rate of over 12 million tons of oil per year from the Doba field (250,000 barrels/day).

Exxon and its partners in the oil development consortium now say that the fate of this project lies with the World Bank's directors. They will not proceed in Chad unless the Bank approves a financial package for the pipeline and oil development by the summer of '98.

The oil companies want World Bank backing to ensure outside support for their quest for Chad's bountiful "black gold" in a tricky social and environmental landscape. According to the Financial Times (Oct. 27, 1997), Exxon, Shell, and Elf Aquitaine "say they are prepared to go ahead with Doba, located in an environmentally and politically sensitive part of southern Chad, if the Bank funds an equity stake in the pipeline by the Chad and Cameroon governments... Exxon has admitted that 'the biggest issue is whether this would be an appropriate use of the Bank's funds.'"

John Hervey, an oil analyst with a New York firm, told the Houston Chronicle in November 1996 that he thought that current reserve estimates for the Doba Basin are "probably conservative. The deposit is actually enormous. I think it could be multibillion barrels.''

Gordon Barrows, another analyst, agreed: He noticed that the pipeline is surprisingly large. "Obviously, they expect much greater things out of Chad than anybody's talking about.''

Barrows noted the difficulty of developing the oil project in the politically-tense region. "They sure find oil in inhospitable places,'' he said. "You couldn't be in a worse situation...It just seems to be a rule. Oil doesn't seem to be found in any place that seems worth visiting."

The oil production projects, and a 650-mile pipeline project to export the oil via Cameroon's port of Kribi, may receive up to $1 billion in World Bank financing. The Chad oil developments and the pipeline have generated considerable social and environmental concerns.

"A potential environmental and social disaster is planned for central Africa and it is going to be part funded by the taxpayer," said Friends of the Earth (UK) campaign director Tony Juniper in May 1997.

One question is how much money from the project will actually reach the people of Chad. The Doba project is projected to put $5 billion worth of royalties in the Chad government's coffers. Similar projects elsewhere in Africa have hardly boosted the health of many people. Roy May, director of African Studies at Coventry University (U.K.) told Inter Press Service in May 1997 that it is "pretty unlikely" that all of the Bank's money will reach the intended development projects.

The Environmental Defense Fund (U.S.), which has joined Friends of the Earth and Africa-based NGOs in a global campaign against the Chad projects, said that both Chad and Cameroon's governments have "a lack of commitment to poverty alleviation." Revenues from Cameroon's offshore oil production have disappeared, said EDF.

"While it's true that the countries have suffered from poor government and civil conflict in the past, it's not necessarily true that they cannot use money well in the future," Andrew Rogerson, World Bank representative for Britain and Ireland, said last year.

This is rather unlikely, argues Jean Nke Ndhe of the local environmental group, Defense de l'Environnement Camerounais. "The bank knows that proceeds from oil production in Cameroon are directed into the private accounts of corrupt leaders," he told Inter Press Service last September. "The people do not even as much as know how much money their oil produces. Is it now that benefits from the pipeline will trickle down to them? Yet foreign aid donors, particularly France and multinational development banks...even encourage generalized corruption in Cameroon by providing more loans, thereby aggravating the already high debt burden, while the country's natural resources continue to disappear without any benefit to citizens."

According to Mr. Ndhe, one person has already been killed by an Exxon-hired security guard for trespassing on his own land.

Other potential impacts include social upheaval from the influx of migrant workers to construction sites, possible leaks from the pipeline, disruption of Chad's most productive agricultural area, and a constant threat of oil spills into national reserves near the port of Kribi. Many lengths of the Exxon-Shell-Elf-owned pipeline will clear stretches of undisturbed rainforest in which tribal peoples live.

"Anybody who complains (about the project in Chad) does so at their own risk," claimed Inter Press Service in May 1997. "In March the government of President Idriss Deby was accused of torture and extrajudicial executions of government opponents and civilians by the human rights group Amnesty International."

Amnesty said that the project could exacerbate tensions between Doba, a center of rebellion against the president, and N'Djamena, the government center. "If an enormous amount of money is generated and displaced people don't see much of it, it is bound to aggravate the situation," said a spokeswoman.

In July 1997 visit to France, Chad's President Deby asserted that his country "has turned the pages of violence and turned its eyes towards reduction of poverty, and reconstruction." The same month, Miles Shaw, an Exxon spokesman, agreed: "Everybody has a slightly different view of human rights but the groups in Doba have signed a recent treaty and everything is quite calm now."

"Many fear the project may create another Ogoniland, the Nigerian oil development debacle," reads a March 12, 1997, editorial by Korinna Horta of EDF in the Journal of Commerce. The underground pipeline will pass through ecologically fragile rainforest areas, including one that is home to a Pygmy population of traditional hunters and gatherers. Once development begins, an uncontrollable influx of people in search of work will occur at construction sites. Deforestation, wildlife poaching and the loss of local village farm land will likely result... As in Nigeria, the people of Chad and Cameroon may derive little or no benefit from oil development, and may instead turn on both the oil companies that take over their environment and the governments that enable the development," concluded Ms. Horta.

Barrows said the area's political turmoil should not impact Exxon, Shell and Elf's investments. Any government in Chad "can't screw it up. It will be such a mainstay of the economy, any oil company would have to be treated with kid gloves, even if a new president shoots his way to the top."

Recent Developments

The controversy over the Chad oil development project has only increased in recent months. Chad President Idriss Deby lambasted "certain politicians" who "according to him, have been trying to create obstacles outside the country to the exploitation of the country's oil," reported Radio France Internationale in April. "This is, undoubtedly, an allusion to the letter sent to the World Bank by southern deputy Gandji Yongar [phonetic], asking the financial organization not to finance Chad's oil activities. It is also, perhaps, an allusion to the communique issued by Hissene Koty's National Committee for Recovery, urging donors not to support the Chadian oil project as long as Deby remains in power."

The United States reportedly has some reservations about the plan. According to the Washington Times (March 28, 1998), "A U.S. official, speaking on the condition of anonymity, said that when the project comes before the World Bank for a vote of approval for a loan in the summer, the United States would consider social, human rights and environmental issues as well as the economic benefits."

In an April 1998 letter to President Deby, Wilfried Telkaemper, an influential member of the European Parliament, wrote "before the beginning of the implementation of the ESSO [a.k.a. Exxon] oil project as well as during its construction and operation, peace needs to be reestablished in the region--without repression and human rights violations against the local population by government security forces or private security forces hired for the project. It is to be hoped the Doba Basin does not become a second Ogoniland." He added that he hoped that "the planned Doba Basin oil project will not continue the tradition of mega-projects which, in fact, destroy local structures and mainly serve the interests of outside investors instead of supporting self-reliant development for the region."

Telkaemper noted that, in March 1998, 200 people lost their lives in southern Chad after the army broke off its truce in the region.

SOURCES: Environmental Defense Fund, "Questions Concerning The World Bank and Chad/Cameroon Oil and Pipeline Project: Makings of a New Ogoniland? Corporate Welfare Disguised as Aid to the Poor?", Washington, D.C., March 1997; Africa Energy & Mining, March 5 and May 7, 1997, March 11, 1998; April 29, 1998; Platt's Oilgram News, Nov. 25, 1996, Energy Alert, June 14, 1996; Houston Chronicle, Feb. 5, 1995; Inter Press Service, May 15,1997, July 3 and 15, 1997; Sept. 18, 1997; Journal of Commerce, March 12, 1997; Reuters, Nov. 28, 1980; Radio France Internationale, April 8, 1998; Financial Times, Oct. 27, 1997 ; Washington Times, March 28, 1998; International Trade Finance, April 10, 1998; International Market Insight Reports, Sept. 29, 1997.

NIGERIA to GHANA

TYPE OF INDUSTRY: 960 kilometer gas pipeline to gas-fired power plant (300 to 600 MW)
SUBSIDIZED PROJECT: West Africa Regional Pipeline
LOCATION: Nigeria to Ghana via Togo and Benin
OWNER: West African Gas Pipeline Company
G-7 TNC Involvement: CMS Energy (consumer) and either Chevron, Shell or United Meridian (gas supplier)
WORLD BANK AGENCY: IBRD, IDA
AMOUNT OF FINANCING: possible $260 million loan.
PROPOSED BOARD DATE: Not available.
RESERVES/PRODUCTION: Gas is to flow at a rate of 50 million to 160 million cubic feet per day, with 75% of the consumption expected in Ghana.
WORLD BANK DESCRIPTION: "The project will assist with the implementation of the construction of a pipeline to transport Nigerian gas to Ghana, Togo and Benin. Project is being identified. Comprehensive gas market surveys are underway. Environmental Assessment Category to be determined. Financing arrangements to complement private sector participation."

(See Case Studies section for further information).

B. COAL MINES

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In September 1997, the Bank approved a $535 million loan for 24 coal mines in India. This loan finances the purchase of equipment for mines holding over 1.4 million tons of coal reserves. The Bank also approved an $800 million loan toward the restructuring of Russia's coal mining sector, and is considering a $100 million loan toward restructuring coal mining in Ukraine. The Bank's strategies in Ukraine and Russia are similar to the process further along in India: first, the Bank finances the closure of unprofitable mines, pushes the mining country toward privatization of its coal mining sector, and then finances continued operations and expansions at the most profitable mines.

From 1992 to September 1998, the Bank approved $2 billion in financing toward coal mining operations which ultimately will release 5.9 billion metric tons of CO2 into the atmosphere.

Approved

INDIA

TYPE OF INDUSTRY: Coal mining expansion
SUBSIDIZED PROJECT: India - Coal Sector Rehabilitation
LOCATION: India
OWNER OF PROJECT: Coal India Ltd. (Calcutta)
G-7 TNC INVOLVEMENT: none yet, but Bank is requiring global bidding for equipment contracts.
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING (estimated total cost): In September 1997, the Bank approved $535 million toward a $1.8 billion expansion of production at 24 coalmines in India. The IDA previously approved a $63 million credit toward an $84 million resettlement and environmental mitigation program for the 24 coal mines.
DATE OF APPROVAL: (IBRD) September 10, 1997.
RESERVES/PRODUCTION: 20 of the 24 mines hold a combined 1.4 billion tons of coal reserves, according to the Bank.
WORLD BANK DESCRIPTION:: "The bulk of the (IBRD) loan would finance the purchase of mining equipment for 24 opencast mining operations in Madhya Pradesh, Maharashtra, Uttar Pradesh, Bihar and Orissa. The loan would also provide technical assistance for redrafting the regulatory framework that governs operations in the coal industry. The aim is to enhance competitiveness and efficiency in the coal industry. ... The Bank has made three loans to the Indian coal industry: in 1984, a loan of US$151 million for the development of the Dudhichua coal mine in Singrauli; in 1985, a loan of US$248 million for the development of an opencast mine (Block II) and an underground mine (Pootkee-Bulliary) in the Jharia coalfield; and in 1987, a loan of US$340 million for the expansion of an opencast mine (Gevra) in the Korba coalfield, the construction of an opencast mine (Sonepur-Bazari) in West Bengal, and imports of coking coal. In 1992, the Board approved a credit of (US$12 million for a technical assistance program to deal with mine fires in the Jharia coalfield.... Implementation of the projects supported by these loans has been uneven..... [T]he process of rehabilitating project-affected people has not been completed, and the resettlement and rehabilitation efforts under these as well as all other coal projects that have received financial support from the Bank in the past are being reviewed in the context of the Coal Sector Environmental and Social Mitigation Project....The opencast mine project in the Jharia coalfield and the Sonepur- Bazari project were plagued by land acquisition problems and social issues. This not only delayed their implementation and the disbursements of the loans, it also reduced the commercial viability of these projects. People affected by these projects demanded employment with the respective subsidiary coal companies, at a time when these companies were under financial pressure to reduce their staff." (World Bank PID INPA9979, February 10, 1997.)
SOURCES: World Bank PID INPA9979, February 10, 1997; World Bank Annual Report FY1996

RUSSIAN FEDERATION

TYPE OF INDUSTRY: Structural Adjustment (privatization/ demonopolization)
SUBSIDIZED PROJECT: Coal Sector Adjustment Loan II
LOCATION: Russia
OWNER:(borrower) Government of the Russian Federation (implementing agency) Ministry of Economy, Moscow, Russian Federation.
G-7 TNC INVOLVEMENT: To be determined. Future TNC investments in Russia's coal mines are likely, given the Bank's push for privatization.
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING (estimated total cost): $800 million
DATE APPROVED: December 18, 1997
WORLD BANK DESCRIPTION: "The project will support the second phase of the government's coal sector restructuring program directed toward (a) continued reduction and improved management of coal subsidies; (b) strengthened and more targeted social safety net; and (c) an accelerated program of de-monopolization, commercialization and privatization of the industry. " (World Bank MOS, February 4, 1998)
RESERVES/PRODUCTION: "The coal industry in Russia after restructuring is expected to remain one of the largest in the world." (World Bank, Technical Annex for the Russian Federation Coal Sector Restructuring Implementation Assistance Project, 1997) Russia holds over 100 billion tons of coal reserves, enough to last 400 years at current rates of extraction. Russia's reserves are not calculated in this report due to the Bank's stated desire to reduce coal production in Russia and the social, rather than productive, nature of their loans. However, this project inevitably sets the stage for the privatization and later expansion of Russia's coal sector.
ENVIRONMENTAL/SOCIAL ASPECT: Category B.
NOTES: The World Bank has described Russia's coal sector as being in a "disastrous state." It has urged Rosugol, the state coal company, to cut production from 260 million tons a year to 180 million tons, and slash its workforce. Rosugol has complained that this reflects a desire to "force Russia out of the European fuel market."
SOURCES: World Bank MOS, February 4, 1998; World Bank PID RUPE50486, October 29, 1997; East European Energy Report, January 27, 1995; Russia Express-Perestroika: Executive Briefing, Feb. 27, March 27, 1995.

Pending

UKRAINE

TYPE OF INDUSTRY: General sector improvement
SUBSIDIZED PROJECT: Coal Mining Improvement
LOCATION: Ukraine
OWNER: (implementing agencies) Ministry of Coal Industry, Kiev
G-7 TNC INVOLVEMENT: "Consulting services to be determined." (World Bank MOS, February 4, 1998)
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING: $100 million
PROJECT STAGE: "Project preparation is underway." (World Bank MOS, February 4, 1998)
WORLD BANK DESCRIPTION: "The objective of the project is to support the development of viable coal mining companies by (a) improving the working conditions and motivation of staff; (b) reducing environmental impact of mining and improving the living conditions in coal mining areas; (c) reducing unemployment in municipalities affected by coal mining restructuring; and (d) improving the management of viable mines. The project will include mine safety and health improvement, environmental improvements, social mitigation and technical assistance and training." (World Bank MOS, February 4, 1998)
RESERVES/PRODUCTION: "Ukraine's total coal reserves amount to 52 billion tons of which 23 billion tons are proven and probable (excluding possible) reserves. Cumulative coal production has been more than five billion tons. Ukraine has practically unlimited supply of coal. However, a large portion of the reserves appear to be uneconomic. The geological reasons for the high costs and the low productivity are great depth, high temperature, frequent gas outbursts and thin coal seams." (World Bank's Ukraine Coal Industry Restructuring Sector Report No. 15056-UA, March 4, 1996)
ENVIRONMENTAL/SOCIAL ASPECT: Category B
SOURCES: World Bank MOS, February 4, 1998

C. FOSSIL FUEL-DRIVEN POWER PLANTS

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Over the last 16 months (May 27, 1997 to September 30, 1998), the Bank approved $2.2 billion in financing for 18 fossil fuel power plants, totaling 16,260 megawatts of power generation capacity. In this short period, the Bank financed more fossil fuel-burning power generation capacity than it had in the previous five years. Most of this power will be produced with the dirtiest fuel, coal.

The Bank has an additional 10 power projects in the works. The biggest pending project -- Sengwe in Zimbabwe -- could release over 2.5 billion tons of CO2 during the next century, if Rio Tinto, co-owner of the proposed power plant and owner of the adjacent coal field, meets its production targets.

The Bank is also looking to rehabilitate numerous coal-fired power plants in Eastern Europe. Over $450 million in World Bank financing is pending to extend the lifetimes of four coal, oil and gas-fired power plants, with a combined capacity of 5,620 megawatts, in Bulgaria and Poland.

Since the 1992 Earth Summit, the Bank has aided over 55 fossil fuel-fired power plants, at a cost of $6.7 billion. We estimate that this will result in the release of 4.8 billion metric tons of CO2 over the lifetimes of the power plants.

Power Plants

Approved (new)

BOSNIA AND HERZIGOVINA

TYPE OF INDUSTRY: Rehabilitation of power stations, transmission and distribution networks supporting 1,977 MW of coal-fired power.
SUBSIDIZED PROJECT: Second Electric Power Reconstruction
LOCATION: Bosnia and Herzegovina
OWNER: (borrower) Bosnia and Herzegovina, (implementing agencies) Electroprivreda Bosne i Hercegovine (EPBiH), Sarajevo, Federation of Bosnia and Herzigovina; Elektroprivreda Mostar, Mostar, Federation of Bosnia and Herzigovina; Elektroprivreda Republika Srpska (EPRS), Banja Luka, Republika Srpska.
G-7 TNC INVOLVEMENT: To be determined. The loan will be used to procure equipment and materials for the rehabilitation of Bosnia's coal and hydro power plants, coal mines, and transmission lines.
WORLD BANK AGENCY: IDA
AMOUNT OF FINANCING (estimated total cost): $25 million of approximately $285 million. The Japanese government loaned $3.9 million toward power plants in Ugljevik and Gacko in Jan. 1998. In Sept. 1998, Japan agreed to provide another $32 million loan toward the four Bosnia power plants: Ugljevik, Gacko, Kakanj and Tuzla. The U.K.'s Overseas Development Agency has approved about $8 million toward reconstruction of the Ugljevik power plant and nearby coal mines.
BOARD DATE: Approved May 19, 1998.
WORLD BANK DESCRIPTION: "The project scope would cover: (i) rehabilitation of generation plants, including civil works and mechanical/electrical equipment; (ii) repair of priority transmission and distribution networks; and (iii) technical assistance for a study of the rehabilitation of the 400 kV system throughout BH, and for engineering and management."(World Bank PID BAPA45483 June 23, 1997).
ENVIRONMENTAL/SOCIAL ASPECT: Category B. "The main environmental issues relate to the thermal power stations that would be rehabilitated. These issues include: dust emissions, sulfur dioxide emissions, possible transboundary acid rain, untreated industrial wastewater at one plant, leaching at an ash disposal site, and pollution from ash transport.... In the medium term installation of flue gas desulfurization would be required for the Ugljevik power plant. The use of an ash slurry pipeline or enclosed trucks for ash transport would be investigated. A minor issue at coal mines is spontaneous combustion of newly mined coal. No remediary action is proposed...." (World Bank PID BAPA45483 June 23, 1997
NOTES: The World Bank loan will benefit the four coal-fired power plants in Bosnia: Tuzla (799 MW); Kakanj (578 MW); Gacko (300 MW); and Ugljevik (300 MW). Each will benefit from the World Bank loan, either through direct assistance for rehabilitation and equipment purchases or indirectly through reconstruction of transmission lines.
SOURCES: World Bank MOS, February 4, 1998; World Bank PID BAPA45483 June 23, 1997; East European Energy Report, Nov. 18, 1996; Bosnian Serb Television, Jan. 23, 1998; Bosnian Serb Radio, Jan. 29, 1997; Beta news agency, Aug. 9, 1996; Reuters, Dec. 12, 1996; European Energy Report, June 29, 1990; Bosnian Serb Television, Sept. 8, 1998; Bosnian Serb news agency SRNA, July 5, 1998; FT Asia Intelligence Wire, July 17, 1998.

CHINA

TYPE OF INDUSTRY: 3,600-megawatt coal-fired power plant (includes transmission, distribution, rehabilitation, development to improve power supply and efficiency, and technical assistance)
SUBSIDIZED PROJECT: Tuoketuo Power Plant
LOCATION: Tuoketuo, Inner Mongolia Region, China
OWNER OF PROJECT: People's Republic of China, Datang Beijing Power Co. (borrower); Tuoketuo Electric Power Generating Co.; shareholders in Tuoketuo: North China Electric Power Group Co., Beijing Energy Management Co., others TBD.
G-7 TNC INVOLVEMENT: To be determined (bidding is open for equipment and services; regional government is welcoming bids for foreign ownership in the plant).
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING (estimated total cost): $400 million of $1.1 billion
DATE OF APPROVAL: May 27,1997
RESERVES/PRODUCTION: The initial capacity of the station is to be 1200 MW (2x600 MW) but plans are for an eventual capacity of 3600 MW (6x600 MW). The first two units will consume about 4 million tons of coal per year.
NOTE: For more information, see the Case Studies section of this report.

TYPE OF INDUSTRY: 2,000 megawatt (2 x 1000MW) coal fired power plant (includes installation of a desulfurization device, support for reform of Shanghai Municipal Power Electric Company (SMEPC))
SUBSIDIZED PROJECT: Waigaoqao Power Station (second phase)
LOCATION: Pudong district, near Shanghai, China
OWNER OF PROJECT: Shanghai Shenergy (40%); People's Republic of China; Shanghai Electric Power Co.; East China Power Group (Global Private Power December 1, 1997)
G-7 TNC INVOLVEMENT: "Sargent & Lundy of USA has been consulting on the technical specifi-cations, layout of the plant and estimated investment for Waigaoqiao." (Industry Sector Analysis (ISA), June 13, 1997). In November 1997, negotiations with potential foreign investors reportedly fell apart, putting privatization plans on hold.
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING (estimated total cost): $400 million of $2.144 billion. Co-financing from Japan Export-Import Bank (up to $50 million loan) is expected.
DATE OF APPROVAL: June 24, 1997
RESERVES/PRODUCTION: 4.8 million tons of coal will be used annually, drawn from the Shenfu-Dongsheng mines. (Financial Times business Report (FTBR) Power in Asia July 14, 1997)
ENVIRONMENTAL/SOCIAL ASPECTS: Category A. The project requires: (a) acquisition of about 1,272 m. of land, (b) demolition of about 41,000 square meters of floor space; (c) relocation of 273 households and 17 town or village enterprises. Overall, about 1,298 people will be affected by the project." (World Bank PID, Project ID CNPE44485 (undated), processed by World Bank Public Information Center in March 1997)
NOTES: The Waigaoqao Power Plant is located in the Pudong New Area of Shanghai at the mouth of the Yangtze river, which is about 18 km away from the city center. Following the completion of the first phase of the Waigaoqao power plant (4X300MW) in 1997, SMEPC plans to initiate the second phase of development of the site through the construction of two coal-fired supercritical units of 1000 MW each, followed by a third and final phase of installation of another 2,000 MW. The station will be the first two supercritical coal- fired units of 900-1000 MW in China. This very large thermal unit is a new technology in China. There are only 27 coal- fired thermal power plants of this size currently under operation and another 11 under construction, all in the US, Japan, and Germany.... Shanghai Power is currently the size of a typical medium sized utility in the US and by the year 2000, it will be the size of a typical large utility in the US. The first two units (Phase One) of the Waigaoqiao plant opened by November 1995. (Xinhua, Nov. 19, 1995; Asia Pulse, May 12, 1997)
NOTE: For more information, see the Case Studies section of this report.

TYPE OF INDUSTRY: Electricity transmission from 2,100 megawatt power plant
SUBSIDIZED PROJECT: Jiangsu Province Power Transmission (from Yancheng Power Plants in Shanxi Province).
LOCATION: East China
OWNER: (implementing agency) East China Group Company, Shanghai, China.
G-7 TNC INVOLVEMENT: AES (25% investor); Foster & Wheeler, Siemens (equipment suppliers)
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING : $250 million of $1.6 billion; separately, in Nov. 1996, the U.S. Export-Import Bank approved a $409 million loan for the sale of Foster Wheeler-made boilers to the project. (U.S. Export-Import Bank press release, Nov. 19, 1996)
DATE APPROVED: March 26, 1998
WORLD BANK DESCRIPTION: "The project will (a) support the development of the 500 kV network to ensure a reliable supply and improve transmission efficiency throughout the province over the long term; (b) connect the Jiangsu Power system to the Yancheng Power Plants (6 x 350 MW) in Shanxi province; and (c) increase and improve inter-provincial power exchange." (World Bank MOS, February 4, 1998)
NOTE: For more information, see the Case Studies section of this report.

TYPE OF INDUSTRY: Hunan Province coal-fired power plants (Leiyang plant expansion of 600 MW, and support of new 700 MW Changsha plant)
SUBSIDIZED PROJECT: China-Hunan Power Development Project
LOCATION: Hunan Province, China
OWNER OF PROJECT: People's Republic of China, Hunan Electric Power Company (HEPC)
G-7 TNC INVOLVEMENT: National Power International (U.K.) won bid to build and own the Changsha plant. In August and September, China opened international bidding under World Bank guidelines for turbine generators, boilers, and other equipment for the Leiyang power plant. The Bank plans to spur privatization of Leiyang, as well.
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING (estimated total cost): $300 million of $775 million total.
BOARD DATE: Approved, June 18, 1998
WORLD BANK DESCRIPTION: "The Project's development objective is to remedy power shortages in Hunan by providing efficient, reliable, and environmentally sound power supply. This project also supports the Country Assistance Strategy for China to alleviate infrastructure bottlenecks in an interior province to foster integrated economic development in Hunan. The Project objective would be achieved by: (a) development of two 300 MW anthracite-fired generating units at the Leiyang Power Plant to alleviate power shortage, (b) reinforcement of the existing 220 kV transmission systems - supply and installation of about 794 km of 220 kV lines and 1,920 MVA of transformer substations capacity. These lines will connect Leiyang Power Plant Phase II and competitively bid BOT Changsha Power Plant (2x350 MW) to" Hunan power grid, etc. (World Bank PID CNPE35698 March 24, 1998)
ENVIRONMENTAL/SOCIAL ASPECTS: Category A. There will be a two stage Resettlement Action Plan to be completed by 1999.
RECENT SOURCES: Business Wire, May 20, 1998; AFX News, Oct. 7, 1998; Financial Times (London) May 21, 1998, June 9, 1998; AsiaInfo Daily China News, Oct. 16, 1998; Asia Pulse, Aug. 18, Sept. 8, 1998.
NOTE: National Power finalized the deal for sole ownership of the Changsha power plant during British Prime Minister Tony Blair's visit to China on Oct. 6, 1998. It purchased the plant, which will cost $700 million to build, for $180 million. The power plant is scheduled to be built by the year 2001. Twenty years later, ownership will transfer to the Hunan government. The $300 million loan is the Bank's largest ever to Hunan Province. For related information, see the Case Studies section of this report.

HUNGARY TYPE OF INDUSTRY: 200 MW diesel-fired power plants (2 x 100 MW) SUBSIDIZED
PROJECT: Quick Start Gas Turbine
LOCATION: Liter (western Hungary) and Sajoszoged (northern Hungary)
OWNER: (borrower) Magyar Villamos Muvek Rt. (MVM), Budapest
G-7 TNC INVOLVEMENT: Within a month of the Bank's approval of this loan, GEC Alsthom (UK/France)'s European Gas Turbine subsidiary won the corresponding contract to supply two 110 MW gas turbines to Hungary. General Electric (US) manufactures the turbines. While the turbines are designed to run on gas, diesel fuel will be used in the power plants, which were due to become operational in September 1998. (Financial Times, July 15, 1997, MTI Econews, July 9, 1997)
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING (estimated total cost): $60 million of approximately $96 million.
DATE APPROVED: June 27, 1997
WORLD BANK DESCRIPTION: "The objective of the Project is... to assist Hungary in meeting its secondary reserve requirements by providing approximately 200 MW of simple cycle (quick start) gas turbines.... The gas turbines will operate on diesel oil, as detailed studies concluded that natural gas would be too costly because of the low rates of utilization (up to 20 times per annum, for periods up to two hours each). The project will thus consist of 200 MW (20%) of simple- cycle (quick start) gas turbines to be installed in two major substations located in Eastern and Western Hungary.... The Bank so far has made two operations in Hungary's power sector, the Power Project (Loan 2697-HU of May 20, 1986, a US$64 million loan, largely aimed at rehabilitating power plants and other electrical facilities), and the Energy and Environment Project (Loan 3705-HU of February 17, 1995, a US$100 million loan comprising a combined cycle power plant, the upgrading of the dispatch center, and technical assistance aimed at upgrading human resources).... (World Bank PID HUPA45251, June 10, 1997)
ENVIRONMENTAL/SOCIAL ASPECT: Category A. "Although the Project is not strictly speaking a conventional power plant, it is proposed to be rated category A. The two gas turbines will be located within the compounds of existing substations, at a distance of about 4 km from nearby villages. The main environmental consideration relates to noise levels, but this is minor given that the units will operate sporadically. No resettlement issues are anticipated with respect to the Project." (World Bank PID, PID HUPA45251, June 10, 1997)
ADDITIONAL SOURCES: World Bank MOS August 4, 1997; World Bank PID BAPA45483 June 10, 1997; MTI Econews, Aug. 12, 1996 and March 18, 1997; European Report, July 23, 1997.

KENYA

TYPE OF INDUSTRY: new 150 MW diesel-fired power plant
SUBSIDIZED PROJECT: First Energy Project
LOCATION: Kenya
OWNER: (implementing agencies) Ministry of Energy, Kenya Power and Lighting Co., Kenya Power Co., Kenya Pipeline Co., National Oil Corp of Kenya
G-7 TNC INVOLVEMENT: Mitsubishi (Japan), which won a contract to build the first of two 75 MW diesel-fired generators in Kipevu in 1997.
WORLD BANK AGENCY: IDA
AMOUNT OF FINANCING (estimated total cost): $125 million of approximately $1 billion. Other funders include Japan's OECF ($83 million), the European Investment Bank ($49 million) and Germany's KfW ($21 million).
DATE APPROVED: June 27, 1997
WORLD BANK DESCRIPTION: "The proposed project would include six components: (i) Sector Restructuring and Reform comprising consultancy services to assist Government of Kenya in restructuring the power sub-sector, instituting a legal and regulatory framework, and promoting private sector participation.... (iv)Power Expansion and Rehabilitation at least-cost, including two 75MW [diesel] power plants in Mombasa [actually Kipevu], two 32MW [geothermal] power plants at Olkaria, a 60MW Hydropower plant on the Sondu River; Mombasa-Nairobi and Nairobi-Kiambere 220 kV transmission lines, rehabilitation of the Nairobi and Coastal area distribution systems, and expansion of other distribution facilities." (World Bank PID, KEPA1344, November 21, 1994; World Bank Environmental Assessment, Report E64, January 1, 1995)
ENVIRONMENTAL/SOCIAL ASPECT: Category A. "The Kipevu diesel unit will be designed to meet western air emission standards and liquid wastes will be treated on site. A new waste water treatment plant is expected to provide for the facility's limited water requirements...145 households will be affected by the access road, reservoir and discharge canal...24 households will require relocation." (World Bank PID, KEPA1344, November 21, 1994)
NOTES: The World Bank and IMF's restructuring program in Kenya now requires the national government toobtain Bank approval for virtually all energy sector decisions. Kenya's independent decision to award private power plant licenses to Iberafrica (Spain) in Nairobi and Sabah Shipyard (Indonesia) and Westmont (Malaysia) in Mombasa, raised protests by the IMF and World Bank last year. Conditions on the Bank's loan toward the rehabilitation and development of separate diesel, geothermal and hydro power plants "will find (Kenya) doubly bound to honor World Bank criteria," according to Africa Energy & Mining.
SOURCES: World Bank Environmental Assessment, Report E64, January 1, 1995; World Bank MOS, June 9, 1997; World Bank PID, KEPA1344, November 21, 1994; KBC radio (Nairobi), May 16, 1997, April 6, 1998; Xinhua News Agency, Oct. 3, 1997; Asia Pulse, July 22, 1997; Financial Times, March 20, 1997; Africa News, Jan. 27, 1998; EIU ViewsWire, Nov. 6, 1997; Indian Ocean Newsletter, Oct. 11, 1997; Africa Energy & Mining, July 16, 1997.

MOROCCO

TYPE OF INDUSTRY: Coal-fired power plant expansion (from 660 MW to 1356 MW)
SUBSIDIZED PROJECT: Jorf Lasfar Power Plant
LOCATION: Morocco
OWNER: Jorf Lasfar Energy Co. (50/50 joint venture between CMS Energy of the U.S. and ABB of Switzerland/Sweden)
G-7 TNC INVOLVEMENT: ABB, CMS Energy (Owners/operators); Cegelec (France, transmission lines), possibly Shell (coal supply). Coal will be imported from South Africa, South America, and the U.S.
WORLD BANK AGENCY: IBRD partial risk guarantee AMOUNT OF FINANCING (estimated total cost): $184 million of $1.5 billion. The U.S. government-run Overseas Private Investment Corporation has guaranteed a $200 million loan for the project, and the U.S. Export Import Bank has guaranteed a $237 million loan. Two other national export credit agencies -- Italy's SACE and Switzerland's ERG, have also guaranteed loans to the project.
DATE APPROVED: August 28, 1997
WORLD BANK DESCRIPTION: "Following the new policy on private participation, the Government of Morocco (GOM) issued competitive bidding for the concession (lease) of the two existing 330 MW coal-fired/steam-based turbo-generators (units 1 and 2) at Jorf Lasfar and for the construction and transfer of Ownership to ONE (Office National de l'Electricite) of units 3 and 4, in exchange for the right to operate the four units for a period of 30 years... The power plant is located along the coast near the port of Jorf Lasfar, 100 km. south of Casablanca. The existing power plant consists of 2x330 MW coal-fired/steam-based turbo-generators (units 1 and 2) which were commissioned respectively at the end of 1994 and during early 1995. The project provides for expansion of the power plant through the addition of two 330 MW turbo-generators (units 3 and 4) of similar characteristics as the existing generators, to be developed by the project Sponsors. The Sponsors of the project are ABB Energy Ventures B.V. (ABB) and CMS Generation Co. (CMS).... The transfer of units 1 and 2 and the start of construction of units 3 and 4 should follow after financial closure. Commissioning of the latter units is scheduled 33 and 39 months after closure (March and September 2000 respectively)." (World Bank PID, Project ID MA-GU-45615, February 1997)
ENVIRONMENTAL/SOCIAL ASPECT: Category A.
NOTES: This will be the first foreign-owned power plant in Morocco. With an ultimate production capacity of 1,356 MW, this will be the largest independent power plant in Africa. It will meet more than half of Morocco's electricity demand, according to Euroweek, which said the project "could pave the way for other deals." While the World Bank is backing fossil fuel power in Morocco, others are pursuing clean energy in the wind and sun-swept country. Electricite de France, for example, is heading a consortium that will operate a 50 MW wind power plant in Tetouan. CMS Energy, 50% Owner/operator of the Jorf Lasfar power plant, is now the world's largest global private power plant developer. The plant is in the vanguard of a wave of private power plants being developed in Middle East. The only other private power generator to date is a 90 MW station in Oman. Other private developments are underway in Tunisia, UAE, Jordan, and Syria and in Egypt and Yemen, where the Bank will decide upon pending loans in June 1998. "In three or four years, private power operators in the Arab world could be running plants with a combined capacity of some 6,000 MW - if all the projects now on the drawing board are completed," predicted the Middle East Economic Digest in February 1998. World Bank officials Elliot Roseman and Anil Malhotra wrote recently that these private power projects "plant the seeds for a top-to-bottom change in the structure and operation of the government-owned utility - seeds that are hard to stop from growing once they take root."
ADDITIONAL SOURCES: Journal of Commerce, Oct. 29, 1996; Reuters, Aug. 13, 1995; PR Newswire, March 13, 1996; World Bank MOS, October 9, 1997; World Bank PID MAGU45615, February 1997; Privatization International, April 1, 1997, Nov. 1, 1997, Feb. 1, 1998; Euroweek, Nov. 14, 1997; EIU ViewsWire, April 8, 1998; Middle East Economic Digest, Feb. 6, 1998, March 27, 1998; Global Power Report, Nov. 14, 1997; Global Private Power, Nov. 1, 1997; Coal Week International, Oct. 21, 1997; Electricity Daily, Sept. 16, 1997; CMS Energy press release, March 20, 1998.

SENEGAL

TYPE OF INDUSTRY: Energy sector reforms (which have catalyzed new oil-fired power plants with combined 87MW capacity)
SUBSIDIZED PROJECT: Senegal Energy Sector Adjustment Operation
LOCATION: Throughout Senegal
OWNER OF PROJECT: Government of Senegal
G-7 TNC INVOLVEMENT: In October, Hydro Quebec won a $24 million contract for a 37.4MW thermal power plant to be built in Senegal by the end of this year. Chagnon International (Canada) will work with Hydro Quebec to set up the power plant. Also this year, General Electric won a $65 million scheme to build a 50MW naptha-fired power plant, which will be built with the engineering and construction assistance of Nuovo Pignone (Italy). Parsons Power (U.S.) is considering construction of a 90MW power plant.
WORLD BANK AGENCY: IDA
AMOUNT OF FINANCING (estimated total cost): $100 million. The Canadian International Development Agency is providing funding for the power plant to be built by Hydro Quebec. The IFC will hold a stake of the GE power plant. SACE (Italy) has guaranteed a loan toward this plant.
BOARD DATE: Approved May 19, 1998
WORLD BANK DESCRIPTION: "This program will promote reforms in the energy sector within the framework of the Government's medium-term reform agenda. The overall agenda reform seeks to liberalize the economy, reduce the size of the public sector, foster private sector development, and support social sector development - with the ultimate objective of reducing the incidence of poverty. The reforms in the energy sector will result, in more efficient electric power service and lower electricity and petroleum, prices. This will reduce factor costs, improving Senegal's competitiveness and growth prospects, as well as increasing job opportunities." (World Bank website, projects passed.)
NOTES: According to the World Bank, the project, in part, aims to "open up the power sector to private investment." The Bank's approval shortly followed an April proclamation by Senegal Finance Minister Mamadou Lamine Loum, that the country's "priorities are reforms in the area of energy. We... need to reform the areas of electricity production, oil products, and domestic energy production." In October, the government opened bidding for a 41% stake in its electricity company, Senelec. General Electric (U.S.), Hydro Quebec (Canada) and Electricte de France are vying for this investment. The World Bank, according to Africa Energy & Mining "hasn't given up its permanent position that private partners should control at least 51% of the company. It has brought further pressure to bear on the government on that point." The Bank loan also pressures the state to privatize its oil refinery. Senelec workers have waged a campaign, including strikes, against the privatization process. Twelve union leaders were due to be tried on Oct. 29 for allegedly sabatoging Senelec facilities as part of this campaign.
SOURCES: M2 Presswire, May 21, 1998; Radio France Internationale, April 27, 1998; Africa Energy & Mining, May 27, Oct. 7, Oct. 21, 1998; Africa News, April 21, 1998.

THAILAND

TYPE OF INDUSTRY: Support for electricity generation and transmission expansion (including 1700MW coal-, 2400NW gas-fired power)
SUBSIDIZED PROJECT: Thailand-EGAT-Investment Program
LOCATION: Throughout Thailand
OWNER OF PROJECT: Electricity Generating Authority (EGAT), government of Thailand
G-7 TNC INVOLVEMENT: Unocal (U.S., 28%) and Total (France, 31%) control the Yadana natural gas field off Burma, and the pipeline from Burma to Thailand's Ratchaburi power plant, which is contracted to be the primary consumer of the Yadana gas. The Burmese government owns 15% of the Yadana gas development. Tasco Mannesmann (Germany) laid the pipeline. Mitsui (Japan) is heading the construction of the Ratchaburi gas-fired power plant, with equipment sub-contracted to General Electric (U.S.) Mitsubishi (Japan) is the contractor of the thermal component of the Ratchaburi power plant, which is due to start producing power in January 2000. Edision Mission Energy (U.S.) and El Paso Energy Int'l (U.S.) are expected to bid for ownership of the Ratchaburi complex.
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING (estimated total cost): $300 million partial credit guarantee; 2d guarantee of $300 million is possible in future. The Japan Export-Import Bank is helping to finance the Krabi coal-fired power plant.
BOARD DATE: Approved September 15, 1998
WORLD BANK DESCRIPTION: "The Project would meet part of the financing gap for EGAT investments during the period FY199-FY2000, for power generation and transmission facilities whose implementation has already commenced. Specifically, the sub-projects are: (a) generation: (i) the 300 MW Krabi Thermal Unit 1; (ii) the 2x700 MW Ratchaburi Thermal Units 1 and 2; (iii) the 3x600MW Ratchaburi Combined Cycle Blocks 1-3; and (iv) the 600 MW Wang Noi Combined Cycle Block 2; and (b) transmission: (i) the 500 kV Transmission System for evacuation of power from IPP plants in Thaliand and the Hong Sa project in Laos; (ii) strengthening of the Bulk Power Supply System for greater Bankgok; (iii) Stage II of the EGA-TNB (Malaysia) Transmission Interconnection; and (iv) the Transmission System Expansion Project No. 9." (World Bank PID, June 1998)
NOTES: See Case Study for further details

YEMEN

TYPE OF INDUSTRY: Diesel power plant (30 MW new, 20 MW rehabilitated capacity).
SUBSIDIZED PROJECT: Yemen-Sana'a emergency power project
LOCATION: Dhahban, Republic of Yemen
OWNER: (borrower) Government of Yemen, (implementing agency) Public Electricity Corporation (PEC)
G-7 TNC INVOLVEMENT: In Sept. 1995, John Brown Engineering (UK) won a contract to expand the Dhahban power plant, but was unable to arrange financing. Ansaldo Energia (subsidiary of Finmeccanica SpA of Italy) recently won a letter of intent from the Yemeni government to carry out the Bank-financed $23.5 million rehabilitation and expansion contract.
WORLD BANK AGENCY: IDA
AMOUNT OF FINANCING (estimated total cost): $54 million
PROJECTED BOARD DATE: approved Sept. 24, 1998
WORLD BANK DESCRIPTION: The loan will "support: (a) installation of an additional 30MW of power generation at the existing Dhahban Power Plant near Sana'a, on an accelerated basis in order to reduce critical power shortages in the Sana'a region; (b) rehabilitation of the existing 20MW of installed diesel generators; and (c) debottlenecking the transmission grid to connect the 50MW of power from the project. The project would also assist the Government's efforts to begin reform of the sector by supporting: (a) the engagement of professional management to operate the Dhahban Power Plant to improve its operating efficiency; (b) preparation of the master plan of power generation and gas utilization; and (c) design of the institutional-organization reform program for the whole power sector in the country." (PID YEPA50530, December 17, 1997).
ENVIRONMENTAL/SOCIAL ASPECTS: Category A
NOTES: Diesel is a politically hot fuel in Yemen. Last October, one Yemeni tribesman died and another was injured in a clash with police over the government's price increase in diesel, which Yemeni agricultural peoples use as their primary fuel. These price increases were initiated by the World Bank and IMF.
SOURCES: APS Review Downstream Trends, November 24, 1997; Risk Monitor Hotline, October 22, 1997; World Bank PID YEPA50530, December 17, 1997; World Bank MOS, February 4, 1998; Middle East Economic Digest, March 6, 1998, Nov. 1, 1996; Agence France Press, Oct. 22, 1997; MEED Weekly Special Report, Aug. 14, 1998; APS Review Downstream Trends, June 15, 1998; Export Sales Prospector, April 1, 1998.

Pending (new)

BANGLADESH

TYPE OF INDUSTRY: (pending) 114 MW oil and gas-fired power plant
SUBSIDIZED PROJECT: Bangladesh-Khulna Power Project
LOCATION: Khalispur, Kulhna, Bangladesh
OWNER: Khulna Power Company (KPC)
TNC INVOLVEMENT: Wartsila (Finland) heads the KPC consortium, which also includes New England
Power (U.S.), and two Bangladesh companies (United Enterprises and Summit Industrial & Mercantile Corp.)
WORLD BANK AGENCY: IFC
AMOUNT OF FINANCING: Not available
PROJECTED BOARD DATE: Not available
WORLD BANK DESCRIPTION: "The barge-based power plant will.... (have) an installed capacity of 114 MW when operating with heavy fuel oil (HFO).... The proposed fuel for the power plant is HFO for the first phase of operation, switching to natural gas for the balance of plant operational life, once natural gas becomes available.... (T)he most probable arrival date is considered to be 2004."
NOTES: Last December, Bangladesh Prime Minister Sheikh Hasina Wajed laid the foundation stone for this, Bangladesh's first private power plant. His government is hoping privatization will boost the country's power capacity by 2,000 megawatts by the year 2000. The proposed power plant would be set up adjacent to an existing 110 megawatt power plant. The IFC's environmental abstract on this project acknowledges that "when the proposed plant is factored into the modeling, the predicted frequency of exceeding" sulfur dioxide air concentration guidelines is higher than it would otherwise be, and that "the land area affected by combined operation of the plants is significantly larger than in the absence of the proposed power plant." The IFC said that Wartsila is investigating methods of mitigating this problem, such as building a taller stack. Wartsilla also has partial Ownership of World Bank-funded power plants in Honduras, Jamaica, and Pakistan. The plant is expected to start producing power in mid-1999.
SOURCES: International Finance Corp., Bangladesh Khulna Power Project Environment Abstract (Project No. 008750), April 17, 1998; IPS/ITIS, Changing the Earth's Climate for Business, May 1997; Agence France Press, Dec. 5, 1997; Xinhua, Oct. 28, 1997; Global Power Report, March 20, 1998; Power Generation Technology & Markets, March 20, 1998.

COTE D'IVOIRE

TYPE OF INDUSTRY: 450MW gas-fired power plant
SUBSIDIZED PROJECT: Azito Power Project
LOCATION: Azito, Cote D'Ivoire (Ivory Coast)
OWNER OF PROJECT: government of Cote d'Ivoire, ABB
TNC INVOLVEMENT: ABB (joint venture partner); Industrial Promotion Services (joint venture partner, part of the Aga Khan's business group); Apache Petroleum (will supply gas from the offshore Foxtrot field, which is partially owns); Willbros Group (U.S., building gas pipeline to plant); United Meridien International Corp. (U.S., supplying gas until Foxtrot gas field becomes available); other Foxtrot partners include Saur (Fr), Petroci (It), Electricte de France and Gaz de France.
WORLD BANK AGENCY: IDA, IFC
AMOUNT OF FINANCING (estimated total cost): The IDA is considering a partial risk guarantee of $30 million to $35 million to back the $215 million project; the IFC may also finance the plant with loans.
PROJECTED BOARD DATE: FY1999
NOTES: In 1997, the Ivorian government contracted ABB to build a 450MW gas-fired power plant in Azito, outside the capital city of Abidjan. Construction was due to begin in January 1998, but was delayed to June after villagers demanded jobs and compensation for hosting one of West Africa's largest power plants. It also fell behind schedule over "a difference with the government over who should pay environmental and site-preparation studies," according to Africa Energy & Mining (Apr. 8, 1998). ABB is hoping that domestic demand for the plant's power will grow in the nickel and gold mining and cocoa bean processing sectors.
SOURCES: Electric Perspectives, Sept/Oct 1997; Africa Energy & Mining, July 8, Oct. 7, 1998; Africa News, Sept. 1, 1998; EIU ViewsWire, July 10, July 30, 1998; Reuters, April 16, 1997; Journal of Commerce, July 2, 1998; Willbros Press Release, April 1, 1998.

EGYPT

TYPE OF INDUSTRY: (pending) new private 650 MW natural gas power plant
SUBSIDIZED PROJECT: Egypt-Sidi Krir Power Project LOCATION: Near Alexandria, Egypt
OWNER: (implementing agencies) Egyptian Electricity Authority (EEA)
G-7 TNC INVOLVEMENT: Earlier this year, InterGen (a partnership between Bechtel of the U.S. and Shell of the UK/Netherlands) won a bid to be the majority Owner and operator of this power plant. Other investors include Continental Energy Services (affiliate of Montana Power); and First Arabian Development & Investment Co. and Kato Investment (Egypt). Stone & Webster (U.S.) has supplied mechanical equipment and piping to the first two generating units at Sidi Krir, of which Bechtel managed the procurement of equipment.
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING (estimated total cost): $100 million (partial risk guarantee) of $750 million.
PROJECTED BOARD DATE: June 1998 (projected appraisal March 1998)
WORLD BANK DESCRIPTION: "The Project will consist of 2X325 megawatt conventional steam generating units. The units will be known as Sidi Krir Units 3 &4 and will be adjacent to Sidi Krir Units 1 & 2, which are under construction by EEA. For the most part, Units 3 & 4 will operate independently of Units 1 & 2. Each unit will be capable of firing natural gas or fuel oil, with fuel oil being for emergency use only. Fuel will be supplied by the Egyptian General Petroleum corporation (EGPC), a state owned enterprise." (World Bank PID EGGUA45067, EGGU45067, June 10, 1997) This will be the first power station in Egypt that involves private sector investments. "The Egyptian Electricity Authority (EEA) is entrusted with public power generation, transmission, and dispatch of electricity. Its installed capacity is 13,500 megawatts." Because of increasing demand, "the addition of over 10,000 megawatts of generating capacity over the next 15 years, which implies investments in the power sector of the order of US$750-1,000 million per annum." (World Bank PID EGGUA45067, JUNE 10, 1997)
ENVIRONMENTAL/SOCIAL ASPECTS: Category A. "The plant will use sea water for cooling."(World Bank PID EGGUA45067, JUNE 10, 1997)
NOTES: The Bechtel/Shell consortium won the bid over ABB (Switzerland-Germany); EDF-GEC-Alsthom (France); Tractebel (Belgium), Marubeni (Japan) and U.S. firms CEA, Edison Mission Energy, Enron, Bechtel, KMR and AES. The number of bidders showed the "groundbreaking nature of this project," reported EIU ViewsWire, which quoted a local official as saying "The hope is that the winner will then be comfortably positioned in a new market." This project taps into Egypt's vast natural gas reserves (750 billion cubic meters), of which Shell holds a considerable share. The Sidi Krir power project "has encouraged the Egyptian government to press ahead with new "private power plant schemes, according to the Middle East Economic Digest, including expansions at two plants near Cairo. Egypt plans to add 14,000 MW of new power generating capacity by the year 2010 (4,100 MW by 2001). InterGen, the Bechtel-Shell partnership, is also building power plants with a total capacity of 5,645 MW in Colombia, Mexico, the Philippines, Turkey, and the U.K.
SOURCES: World Bank PID EGGUA45067, June 10, 1997; World Bank MOS, February 4, 1998; Swiss Review of World Affairs, November 3, 1997; Agence France Press, October 16, 1997; Global Power Report, February 20, 1998, Middle East Economic Digest, Feb. 6, 1998; Engineering News-Record, Dec. 23, 1996; ESP-Business Opportunities in Africa & the Middle East March 1, 1998; Middle East News Items, Feb. 8, 1998; EIU ViewsWire, July 30, 1997; Power Asia, Oct. 3, 1994; Business Wire, Feb. 11, 1998.

INDIA

TYPE OF INDUSTRY: Construction of a solar/thermal fossil fuel hybrid power plant of about 140 MW (35-40 MW solar, 100-105 MW coal, oil or gas)
SUBSIDIZED PROJECT: Solar Thermal Power
LOCATION: Mathania (near Jodhpur), Rajasthan state, India
G-7 TNC INVOLVEMENT: Amoco-Enron (U.S., 100% Owner-developers)
OWNER: (borrower) Government of India
WORLD BANK AGENCY: GEF
AMOUNT OF FINANCING: $49 million of $245 million. GEF has already released $750,000 for project preparation. Kreditanstalt fur Wiederaufbau (KfW), Germany's development bank, has loaned $149 million to this project.
PROJECTED BOARD DATE: Not available.
WORLD BANK DESCRIPTION: "The project will focus on construction of a solar thermal/fossil fuel project of about 140 MW, incorporating a parabolic trough solar thermal field of 35 to 40 MW. It will also include a technical assistance package to support commercialization of solar thermal technology." (World Bank MOS, February 4, 1998) "The solar thermal/hybrid power station will comprise: (i) a solar field with a collection area of 219,000 m2 to support a 35MWe to 40MWe solar thermal plant; and (ii) a power block based on mature fossil fuel technology.... The final choice of the fossil-fired power block would be left to the bidders, subject to performance parameters set out in the tender specifications. A likely design choice is an Integrated Solar Combined Cycle (ISCC) involving the integrated operation of the parabolic trough solar plant with a combined cycle gas turbine using fossil fuels such as fuel oil, low sulfur heavy stock [coal] or naphtha... " Of the total plant investment, $66 million is attributable to development of the solar field, $121 million for fossil fuel-based power block, and about $52 million for engineering, site development, and initial working capital requirements. (GEF PID INGE43021 July 28, 1997)
ENVIRONMENTAL/SOCIAL ASPECTS: Category A.
NOTE: See Case Studies section for further details.
SOURCES: World Bank MOS, February 4, 1998; Greenwire, September 15, 1997; Presswire, April 3, 1998; The Economist, September 6, 1997; GEF PID INGE43021

VIETNAM

TYPE OF INDUSTRY: 700MW gas-fired power plant (follow-up to previous loan)
SUBSIDIZED PROJECT: Phu My 2/2 Power Project
LOCATION: Phu My, Vietnam
OWNER OF PROJECT: Electricity of Vietnam (govt)
TNC INVOLVEMENT: GEC-Alsthom (UK/Fr) is reportedly interested in buying the plant; possibly Marubeni and ABB, which were involved in other phases of the Phu My complex.
WORLD BANK AGENCY: IDA
AMOUNT OF FINANCING: Up to $25 million (partial risk guarantee); in February 1996, the IDA approved a $180 million credit toward the construction of Phu My 2/1.
PROJECTED BOARD DATE: FY1999
WORLD BANK DESCRIPTION: The IDA offered this guarantee in support of commercial debt finance as an option in the bidding for this plant. "Bids were submitted on April 2, 1998. Whether the IDA guarantee would be required by the winning bidder will not be known for another 3-5 months." (World Bank MOS, June 11, 1998).
NOTES: The IDA has backed this first international competitively bid power plant in Vietnam since 1996. The 700MW burner, dubbed Phu My 2/2, is one of many phases of developments of the Phu My power complex, which will eventually have a combined capacity of 2400MW. GEC-Alsthom (U.K.) is reportedly interested in building and owning the Phu My 2/2 plant, which is expected to be operational by 1999. Phu My 1, with two 300MW gas/oil boilers, is being built by Marubeni and ABB, with backing from Japan's OECF. Phu My 2/1, built by Marubeni and ABB with the previous World Bank assistance, was completed in 1997, and employs two 150MW gas turbines. That phase was backed by the previous IDA loan. The third phase, Phu My 3 (600MW), also will court private construction and ownership.
SOURCES: Asia Pulse, Feb. 24, 1997 and May 5, 1997; Financial Times, July 23, 1996; Business Times, March 13, 1996; Xinhua, Feb. 27, 1996; Japan Economic Newswire, Dec. 25, 1995; Agence France Presse, Dec. 17, 1995; Power Economics, Sept. 30, 1998; Vietnam Economic News, Aug. 31, 1998; Independent Enegy, July/August 1997; East Asian Executive Reports, Aug. 15, 1997.

ZIMBABWE

TYPE OF INDUSTRY: New private 1400 megawatt coal-fired power plant
SUBSIDIZED PROJECT: Fourth Power Project
LOCATION: Sengwa coal fields, Gokwe, north Zimbabwe
OWNER OF PROJECT: Zimbabwe Electricity Supply Authority, Rio Tinto, National Power
G-7 TNC INVOLVEMENT: Rio Tinto, National Power (U.K.), owners, operators. Coal to be supplied by adjacent Rio Tinto mining operations.
WORLD BANK AGENCY: IDA
AMOUNT OF FINANCING (estimated total cost): $60 million
PROJECTED BOARD DATE: Not determined
WORLD BANK DESCRIPTION: "This project will support the establishment of a private joint venture company responsible for the construction, management, and operation of a 1400 MW coal-fired power plant. Project preparation is underway. Environmental Assessment Category to be determined." (World Bank MOS)
NOTES: In 1994, the World Bank approved a $90 million loan toward the rehabilitation and expansion of the 960MW Hwange coal-fired power plant in Zimbabwe. Two years later, when the Zimbabwean government decided to award the contract to a Malaysian corporations -- and not to four Western bidders, including National Power of the U.K. -- Western governments quickly condemned the perceived betrayal. Zimbabwean ambassadors in Western capitals, according to President Robert Mugabe, were summoned to explain the decision but he said, "I told them to go to hell, because Hwange thermal plant is ours and we do what we want with it." In Washington, Under Secretary of State for Commerce Chester Crocker said that "warped" contract awards would do "irreparable damage" to Zimbabwe's business relations with the U.S. Now, two more years later, the World Bank is back as a promoter of private coal-fired power in Zimbabwe. This time, they are planning to back a power project that is certain to be controlled by Western corporations. The target now is a $1.6 billion power plant planned to built in the coal fields of northern Zimbabwe by British giants National Power and Rio Tinto, which would extract 4 million tons/year of coal from the Zambezi Valley to supply the station. Rio Tinto discovered reserves of 925 million tons in the Sengwa coal field in 1995. When completed, the power plant will have a 33% share of the country's energy generation. Rio Tinto and National Power hope to start producing power at Sengwe by the year 2004. In 1995, Rio Tinto said that its proven reserves were "more than sufficient to support a significant power generation facility for around 100 years."
SOURCES: New Straits Times (Malaysia), October 21, 1998; Business Day (South Africa) October 19, 1998; Xinhua, Aug 16, 1996; Jan. 9, 1998; Financial Times (London), Sept. 15, 1997; Rio Tinto press release, Feb. 25, 1997; SABC Channel Africa radio, Oct. 30, 1995; Kenya News Agency, May 9, 1995.

Pending (rehabilitation)

BULGARIA

TYPE OF INDUSTRY: 1200 MW coal-fired power plant rehabilitation (Varna)
SUBSIDIZED PROJECT: Adaptable Lending and Privatization (formerly Energy II)
LOCATION: Bulgaria OWNER: (borrower) Natsionalna Elektricheska Kompania (NEK)
G-7 TNC INVOLVEMENT: To be determined.
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING (estimated total cost): $100 million of $220 million (if fuel at Varna is switched from anthracite to low sulfur bituminous coal--most expensive). The EU's PHARE aid program granted ECU$13 million toward the purchase of coal by the Varna power plant and for plant modernization.
PROPOSED BOARD DATE: September 1998.
ENVIRONMENTAL/SOCIAL ASPECTS: Category B.
NOTES: Coal burned at Varna comes from domestic mines, as well as coal mines in Indonesia, Russia, and Vietnam. Bulgaria plans to privatize its National Electric Company (NEC). According to the East European Energy Report, "NEC itself has already approached potential foreign investors, such as Siemens, offering them the opportunity to invest in the building of new power stations." The NEC has not yet decided whether to modernize and continue operating Varna, or to simply privatize it. In 1996, U.S., U.K. and Swedish companies reportedly exPressd interest in taking over the Varna power plant.
SOURCES: Bulgarian news agency, Jan. 14, 1997, Feb. 28, 1997; "168 Chasa" (Sofia), Aug. 26, 1996; Coal Week International, Feb. 24, 1998; East European Energy Report, April 1996, Dec. 1, 1997; EC Energy Monthly, Dec. 13, 1996; International Coal Report, June 12, 1995.

TYPE OF INDUSTRY: Gas-fired district heating plant rehabilitation and conversion to gas/oil
SUBSIDIZED PROJECT: District Heating
LOCATION: Bulgaria
OWNER: (borrower) Government of Bulgaria, (implementing agencies) Sofia District Heating Company, Pernik district Heating Company
G-7 TNC INVOLVEMENT: To be determined
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING (estimated total cost): $ 100 million of $470 million.
PROJECTED BOARD DATE: December 1998, "Project preparation is underway" (MOS January 1998) ENVIRONMENTAL/SOCIAL ASPECTS: Category B NOTES: The World Bank projects include rehabilitation of Sofia's gas-fired district heating systems and major rehabilitation of these plants, including conversion to combined cycle (gas and oil) operation. In 1995, Bulgarian energy official Konstantin Todorov said, "We are inviting investors to help finance the construction of energy units together with the National Electricity Company or fully finance them," including a gas-fired heating plant in Sofia. This loan has been under consideration since 1992.
SOURCES: World Bank MOS, January 1998; East European Energy Report, May 22, 1995; World Bank PID BGPA8314, March 4, 1997; World Bank Watch, June 1, 1992. "Duma" (Sofia), Sept. 25, 1997.

POLAND

TYPE OF INDUSTRY:1,600-megawatt coal power plant rehabilitation and life-span extension
SUBSIDIZED PROJECT: Dolna Odra Power Generation Rehabilitation Project
LOCATION: Poland, near German border
OWNER OF PROJECT: (implementing agency) Dolna Odra Group of Power Plants
G-7 TNC INVOLVEMENT: In 1997, SHU Saarberg Umwelttechnik (Germany) was contracted to build a desulfurization line at Dolna Odra. (PAP News Wire, March 2, 1997)
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING (estimated total cost): According to the Bank, "the estimated cost of the proposed project is about US$215 million.... A preliminary financing plan for the project would consist of a combination of a direct Bank loan and a partial credit guarantee of US$110 million, the Borrower's internal cash generation of US$65 million and a concessional loan from the National Fund of US$40 million for the environmental component." (WB PID)
PROJECTED BOARD DATE: May 1997
WORLD BANK DESCRIPTION: "Specifically, the project would: (a) extend the life of existing coal-fired plant asset and improve its performance through rehabilitation and the introduction of modern technologies; (b) enhance energy conservation and efficiency through investments in energy-efficient equipment and systems, [etc.]... The project would focus on the Dolna Odra power plant, located about 30 km away from the city of Szczecin and about 2 km from Germany. The plant is part of the Dolna Odra Group of Power Plants which covers also CHP Szczecin and CHP Pomorzany, both located in Szczecin. Dolna Odra power plant ranks among the priority candidates for rehabilitation and environmental upgrade. It has an installed capacity of 1,600 MWe consisting of eight 200 MWe units, burns hard-coal and plays a major role in Poland's electricity exports to Germany." (World Bank Public Information Document, Project ID PLPA40816, March 19, 1996)
NOTES: In December 1997, Poland implemented a new energy law that allows the privatization of its 33 power plants, including the 1975-era Dolna Odra plant. In addition to Westinghouse, ABB and Foster Wheeler are providing power generation equipment to many Polish power plants.
SOURCES: EIU Business Eastern Europe, Feb. 9, 1998, PAP news agency, Feb. 18, 1997

TYPE OF INDUSTRY: 1,600-megawatt coal power plant rehabilitation and life span extension
SUBSIDIZED PROJECT: Rybnik Power Generation Rehabilitation Project
LOCATION: Poland
OWNER OF PROJECT: (Borrower) Rybnik Power Generating Company
G-7 TNC INVOLVEMENT: Westinghouse (U.S.) has entered into a joint venture with seven Polish power stations in 1992 for modernization services, including Rybnik. (March 5, 1992. March 2, 1997; PR Newswire, May 29, 1996 )
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING (estimated total cost): According to the World Bank, "the estimated cost of the proposed project is about US$300 million. A preliminary financing plan for the project would consist of a combination of a direct Bank loan and a partial credit guarantee of US$140 million, the Borrower's internal cash generation of US$90 million and a concessional loan from the National Fund of US$70 million for the environmental component."
PROJECTED BOARD DATE: May 1997
WORLD BANK DESCRIPTION: " Specifically, the project would: (a) extend the life of existing coal-fired plant asset and improve its performance through rehabilitation and the introduction of modern technologies; (b) enhance energy conservation and efficiency. [etc.]... The project would focus on the Rybnik power plant, which is located in the city of Rybnik in Upper Silesia. Rybnik power plant ranks among the priority candidates for rehabilitation and environmental upgrade. It has an installed capacity of 1,600 MWe consisting of eight 200 MWe units and burns hard-coal." (World Bank PID PLPA45201)
NOTES: In April 1997, Westinghouse completed the refurbishing of two 200 MW coal-fired turbines at Rybnik (Units 4 & 7). Westinghouse manufactured the equipment in North America and Poland. 85% of Poland's power is generated from coal.
SOURCES: Modern Power Systems, April 1997, Polish News Bulletin, Nov. 15, 1996; Financial Times, June 19, 1997.

D. FOSSIL FUEL-DRIVEN POWER SECTOR REFORMS

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Overview

In addition to projects that directly finance fossil fuel extraction or power production by transnational corporations, the Bank is extending considerable loans and credits toward privatizing nationalized electricity distributors. These arrangements are designed to force corresponding reforms that will allow corporations to develop new independent power projects in these countries.

Since May 1997, the Bank has financed four such projects totaling $570 million in India, Russia, Turkey and Ukraine. It is considering an additional $2.2 billion toward 15 pending electricity, heating, and gas transmission projects.

In a typical electicity sector privatization plan, in January 1998, the Bank approved a conditional $600 million loan for privatizing the Indian state of Haryana's power sector. This long-term program, said the Bank, will open the state to "private sector participation in generation and transmission utilities."

Similarly, a proposed $100 million loan to Algeria will "provide an enabling environment for private sector investment through the introduction of independent power producers... The proposed project would support the introduction of private generation," reads a World Bank PID. While CO2 emissions can not be tied directly to these types of loans, in the long term, these kinds of reforms certainly promote the proliferation of fossil fuel power, as the Bank admits.

Also worth noting are the social conflicts that arise when the Bank and the International Monetary Fund hike the price of energy through restructuring programs in places like Haryana and Yemen (see power plant section). Haryana, traditionally, has provided free electricity to farmers. Implementation of the new framework has already resulted in the death of six farmers who "were killed in agitation against the Haryana State Electricity Board because it refused to supply power unless it was paid." (Global Power Report, February 6, 1998).

Approved

INDIA

TYPE OF INDUSTRY: Electricity transmission and distribution reforms, including privatization
SUBSIDIZED PROJECT: Haryana Power Sector Restructuring
LOCATION: state of Haryana, India
OWNER: Haryana State Electricity Board (HSEB)
G-7 TNC INVOLVEMENT: Possibly Rolls Royce for pipeline equipment.
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING (estimated total cost): $60 Million of the Proposed $77 Million for first project. According to the Bank, "Bilateral donors have been approached and are expressing interest (including, Canada, Germany, Japan, UK and USA)." BOARD DATE: Approved January 1998 as first "adaptable program" loan. This adaptable loan will span 8 to 10 years and will total $600 million to support restructuring Haryana's power sector.
BOARD DATE: First tranche of $60 approved January 1998 as first "adaptable program" loan. This adaptable loan will span 8 to 10 years and will may $600 million to support restructuring Haryana's power sector. The second tranche of $150 million is now under consideration.
WORLD BANK DESCRIPTION: The goal of the restructuring is for the Government of Haryana to "withdraw from the power sector as an operator of utilities and to establish commercially-operated utilities functioning in a competitive and appropriately-regulated power market, with significant private Ownership and participation."
ENVIRONMENTAL/SOCIAL ASPECTS: Category B. "The impact of this investment program on land acquisition will be minimal."(PID INPE35160, December 1997).
SOURCES: World Bank PID INPE35160, December 1997; Global Power Report February 6, 1998; Business Line, May 24, 1997.

RUSSIA

TYPE OF INDUSTRY: Electricity Sector Reform (Demonopolization/ Privatization)
SUBSIDIZED PROJECT: Russia-Electricity Sector Reform - Technical Assistance
LOCATION: Russian Federation
OWNER: (borrower) Russian Federation; (implementing agency) Electricity Reform Supervisory Council
G-7 TNC INVOLVEMENT: "Consulting services will be required."
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING (estimated total cost): $40 million of an estimated $68 million.
DATE APPROVED: June 5, 1997
WORLD BANK DESCRIPTION: "The project would finance foreign and Russian specialists to work with the various sector and government agencies and with the Electricity Reform Implementation Unit (ERIU) on implementation of the reform agenda. TA would fall into three broad categories: (i) assistance to the government in analyzing and elaborating a detailed plan and schedule for realization of the reform concept, including analyzing technical and institutional barriers to meeting the objectives and identifying alternative solutions; (ii) assistance in carrying out the activities necessary to implement the plan; and (iii) support for the development of power sector entities, including corporatization and commercialization of operating companies and institutional strengthening of the regulators. A number of teams would be established to work with each of the sector entities on issues related to the reform process, and on cross-cutting issues such as training, public participation, and social protection. Two teams would work with the ERIU to assist in general project management and coordination and to assist in policy analysis."
ENVIRONMENTAL/SOCIAL ASPECT: Category C.
SOURCES: World Bank MOS, February 4, 1998; World Bank PID RUPE50891, April 28, 1997

TURKEY

TYPE OF INDUSTRY: Transmission system expansion
SUBSIDIZED PROJECT: National Transmission Grid
LOCATION: Turkey
OWNER: (borrower) Turkish Electricity Generation and Transmission Corporation, Ankara, Turkey.
G-7 TNC INVOLVEMENT: Recent TNC winners of large coal-fired power projects in Turkey include Alsthom ($380 million worth of turbines and other equipment for the Canakkale plant); National Power (rights to operate three existing coal-fired power plants) and a Mitsubishi-led consortium for the new 1,440 MW Afsin-Elbistan B coal-fired power plant. ABB and Mitsubishi are in the running for the identical 1,440 MW Afsin-Elbistan C plant.
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING: $270 million of $502 million
BOARD DATE: Approved June 11, 1998.
WORLD BANK DESCRIPTION: "The project will (a) finance a three-year time-slice of the transmission system investments; (b) provide technical assistance to develop and implement a transmission policy and institutional strengthening measures; and (c) prepare Turkish Electricity Generation and Transmission Corporation's access to international debt markets under the Bank's partial guarantee program." (World Bank MOS, February 4, 1998)
ENVIRONMENTAL/SOCIAL ASPECT: Category B.
NOTES: The government of Turkey has a goal of doubling power generation capacity by the year 2010, and is pushing energy sector privatization as a means toward that end. The World Bank loan supports the reform of Turkey's power sector and the expansion of the transmission grid.
SOURCES: World Bank MOS, February 4, 1998; Middle East Economic Digest, July 31, 1998; Anatolia news agency, June 26, 1998; AP Worldstream, Oct. 14, 1998; Power Generation Technology & Markets, Aug. 14, 1998; Middle East Review World of Information, June 1998.

UKRAINE

TYPE OF INDUSTRY: District heating rehabilitation and commercialization
SUBSIDIZED PROJECT: Kiev District Heating Improvement
LOCATION: Kiev, Ukraine
OWNER: (borrower) Republic of Ukraine; (implementing agencies) State Committee for Energy Conservation; Kievenergo; Kiev Municipal District Heating Company; Sevteploenergo
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING (estimated total cost): $200 million of $309 million. The EBRD is contributing $40 million.
BOARD DATE: Approved May 21, 1998
G-7 TNCS: May be contracted to supply new boilers, other equipment.
WORLD BANK DESCRIPTION: "The proposed project might consist of the following components: (a) Kiev district heating (DH) system rehabilitation program, including rehabilitation/construction of heat production facilities, replacement of old pipelines and installation of new transmission pipelines to connect new areas of development, rehabilitation of water treatment facilities and improvements to substations including installation of heat meters; (b) Kiev public buildings energy efficiency improvement program, including improvements to insulation, regulation and control systems, and windows, and installation of control valves and a two- pipe system for radiators; (c) Sevastopol heat supply improvement program, including either rehabilitation of the existing DH system or modest decentralization of the DH system or a combination thereof, to be determined on the basis of further study; and (d) institutional support program, including training, equipment and technical services to support project implementation, commercialization and further development of DH enterprises."
ENVIRONMENTAL/SOCIAL ASPECT: Category B
NOTES: About half of Ukraine's energy needs, including district heating, are supplied by natural gas, much of which is imported from Turkmenistan and Uzbekistan.
SOURCES: World Bank MOS, February 4, 1998; World Bank PID UAPA44832 April 15, 1996; M2 Presswire, May 22, 1998, Oct. 16, 1998; Financial Times, Jan. 30, 1998.

Pending

ALGERIA

TYPE OF INDUSTRY: Power sector restructuring, transmission and distriubtion expansion
SUBSIDIZED PROJECT: Power Sector IV
LOCATION: Algeria
OWNER: (borrower) Societe Nationale de l'Electricite et du Gaz (SONELGAZ), (implementing agency) Sonelgaz, Algiers, Algeria
G-7 TNC INVOLVEMENT: To be determined.
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING (estimated total cost): $100 million of $611 million (approximately)
PROJECTED BOARD DATE: July 13, 1999
WORLD BANK DESCRIPTION: "The proposed project would improve the reliability and security, and reduce losses in the transmission and distribution systems. Sonelgaz has been effective in meeting the load demand so far. However, according to the least cost development plan, and in order to avoid load shedding, Sonelgaz needs to add new capacity. The proposed project would support the introduction of private generation. The loan will also finance a 'time-slice" of Sonelgaz's 1998-2002 least cost plan, which comprises the expansion/ rehabilitation of transmission and distribution networks. The Government intends to increase efficiency and encourage competition through private sector participation in the power sector. "
ENVIRONMENTAL/SOCIAL ASPECT: Category B.
SOURCES: World Bank PID, February 1997; World Bank MOS, February 4, 1998.

ARMENIA

TYPE OF INDUSTRY: Privatization and rehabilitation of electricty transmission and distribution
SUBSIDIZED PROJECT: Electricity Transmission and Distribution
LOCATION: Armenia
OWNER: (borrower) Government of Armenia; (implementing agency) Ministry of Energy, Yerevan, Armenia; (beneficiaries) Armenergo, Yerevan Distribution Company, Shirak, Lori, Taush, Aragatsotn, Kotaik, Ararat, Gegharkunk, Vayots Dzor, and Siunik.
G-7 TNC INVOLVEMENT: To be determined.
WORLD BANK AGENCY: IBRD/IDA
AMOUNT OF FINANCING (estimated total cost): $51.7 million of approximately $55 million. "The proposed project is to be complemented by a parallel project of US$48.0 million (expected to be financed by Japan's Overseas Economic Cooperation Fund (OECF))..."
PROPOSED BOARD DATE: March 1998
WORLD BANK DESCRIPTION: "The proposed project would: (i) reduce the energy-intensity (consumption/GDP) of the economy as a means to improve its competitiveness and the country's energy security and reduce electricity supply costs; electricity cost; and (ii) attract private investment and participation in the power sector."
ENVIRONMENTAL/SOCIAL ASPECT: Category B.
SOURCES: World Bank MOS, February 4, 1998; World Bank PID AMPE8276, September 1997.

BANGLADESH

TYPE OF INDUSTRY: Power sector privatization and electricity distribution expansion
SUBSIDIZED PROJECT: Power Development
LOCATION: Bangladesh
OWNER: (implementing agencies) Ministry of Energy and Mineral Resources (MEMR); Power Grid Co. of Bangladesh Ltd.; Rural Electrification Board (REB)
G-7 TNC INVOLVEMENT: To be determined.
WORLD BANK AGENCY: IDA
AMOUNT OF FINANCING: $200 million. " A Japanese PHRD grant has been approved to undertake the preparatory work."(World Bank MOS, February 4, 1998)
PROJECT STAGE: "Project is being identified."
WORLD BANK DESCRIPTION: "The project will seek to (a) hand over the transmission system of the country to the Power Grid Corporation and provide SCADA and Energy Management System facilities for optimizing dispatch and operational control; (b) develop a market environment in the sector by establishing profit centers and facilitate private sector participation in utility operations; (c) rationalize distribution supply areas between existing utilities and rehabilitate networks to be handed over to the Rural Electrification Cooperatives (PBSs); (e) expand rural electrification coverage by selective use of both renewable options and grid extensions; and (f) establish a regulatory body to provide a framework for the reformed sector operations."
ENVIRONMENTAL/SOCIAL ASPECT: Environmental category to be determined.
SOURCE: World Bank MOS, February 4, 1998

DOMINICAN REPUBLIC

TYPE OF INDUSTRY: Power sector reform
SUBSIDIZED PROJECT: Power Transmission
LOCATION: Dominican Republic OWNER: (implementing agency) Corporacion Dominica de Electricidad (DCE)
G-7 TNC INVOLVEMENT: "Consulting services will be required."
WORLD BANK AGENCY: IBRD
AMOUNT OF FINANCING: $20 million
DATE APPROVED: January 15, 1998
WORLD BANK DESCRIPTION: "The project's overall objective is to support power sector reform by establishing a competitive bulk supply market for electricity. Specifically, the project seeks to lift transmission constraints that hinder open access of publicly as well as privately owned power generators and to support (a ) installation of Energy Control Center (ECC) and Financial Settlement Center (FSC) (b) strengthening and expansion of the Interconnected Transmission System; and (c) providing technical assistance."
ENVIRONMENTAL/SOCIAL ASPECT: Category A
SOURCES: World Bank MOS, February 4,1998

INDIA

TYPE OF INDUSTRY: Multi-system coordination and transmission system improvement