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| Summary of Project Information (SPI) |
| This Summary of Project Information is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. |
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| Project number | 24066 |
| Project name | Continental Carbon of India Limited II |
| Country | India |
| Sector | Chemicals |
| Department | Oil, Gas, Mining And Chemicals |
| Company name | Continental Carbon India Limited |
| Environmental category | B |
| Date SPI disclosed | April 3, 2006 |
| Projected board date | May 3, 2006 |
| Status | Active |
| Previous Events | Invested: July 25, 2006
Signed: June 22, 2006
Approved: June 21, 2006 |
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| Description of company and purpose of project |
Continental Carbon India Limited (“CCIL”, the “Company”), located in Ghaziabad, State of Uttar Pradesh, India, is a carbon black manufacturing company with the nameplate capacity to produce up to 65,000 tons per annum (tpa) of carbon black. The company has requested IFC assistance for the financing of its project, consisting of the following components:
- the construction and operation of about a 15 MW power co-generation facility;
- the de-bottlenecking and modernization of its existing carbon black facility; and
- the restructuring of the outstanding IFC A and B loan maturities in the amount of $11.75 million.
The project is scheduled to be completed in June 2008.
IFC financed the original project in 2001 (IFC/R2001-0017) which was to upgrade, modernize and expand an existing carbon black plant acquired from Oriental Carbon & Chemicals Limited, providing $9.0 million in A loan and $11.5 million in B loans. |
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| Project sponsor and major shareholders of project company |
| The project sponsor is China Synthetic Rubber Corporation (“CSRC”) that owns 66.7% of the Company indirectly through CCC USA Corporation, its 66.67% subsidiary, and Continental Carbon Company, a 100% CCC USA Corporation subsidiary. Founded in 1973, CSRC is one of the world’s leading carbon black producers and technology providers. Continental Carbon Company owns about 99.9% of CCIL. |
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| Total project cost and proposed IFC investment |
| The total project cost is estimated at $30.6 million. IFC’s proposed investment is $21.0 million, consisting of an equity investment of up to $2.0 million, an A loan of up to $7.0 million for IFC’s own account and a B loan of up to $12.4 million for the account of participants. |
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| Location of project and description of site |
| The project is located in Ghaziabad, about 15 km from Delhi, India. The project site covers 64,618 square meters on which the carbon black plant, 4.4 MW power co-generation facility, feedstock storage, warehouse and the administration building are situated. |
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| Project Development Impact and IFC's Role |
The project will support the survival of a privately owned enterprise that has established a competitive operation. In particular, the project will:
- further improve the plant’s environmental standards by expanding power co-generation capacity and modernizing existing technical processes;
- help alleviate an acute power shortage in Uttar Pradesh through the sale of excess power;
- benefit the local economy through increased tax revenues; and
- support an important specialty chemical industry and promote sustainable growth of the tire industry by supplying high quality raw material efficiently.
Monitoring of development impact will focus primarily on the company’s power sales, carbon black conversion margins and debt service coverage ratios.
By supporting this project with long-term financing, IFC is helping a key supplier of carbon black and employment generator survive this difficult period of high and volatile feedstock costs while, at the same time, improving its global competitiveness and the sustainability aspects of its operations and helping alleviate the power shortage in Uttar Pradesh, one of the poorest states in India. IFC has provided advice on the company’s future strategic directions, the modernization of its existing technical operations and on structuring the overall financial package. |
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| Environmental and social issues - Category B |
This is a category B project according to IFC’s procedure for environmental and social review of projects because a limited number of specific environmental and/or social impacts may result, which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria.
Further details are provided in the Environmental Review Summary separately available with this document.
To view the environmental documents for this project, click here |
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| Location of environmental documents in locally affected community |
Environmental documents, including the ERS and Corrective Action Plan (CAP) will be posted at the following locations:
- the Local School – Primary School Chipiyana Ghaziabad;
- the Notice Board outside CCIL Plant; and
- the Local Newspaper-(“Hint Ghaziabad”). |
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| To contact the project company, please write to: |
Mr. Deepak Malik
Managing Director
Continental Carbon India Limited
A-14, Industrial Area No. 1
(Off NH-24), South Side of G.T. Road,
Ghaziabad -201 001 (U.P.) India
Tel: (91) 120-2840501
Fax: (91) 120-2840504 |
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