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Summary of Project Information (SPI) |
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| Project number | 9494 |
| Project name | Klaipedos Mediena AB |
| Country | Lithuania |
| Sector | Industrial & Consumer Products |
| Department | Global Manufacturing & Services |
| Company name | AB Klaipedos Mediena |
| Environmental category | B |
| Date disclosed | October 8, 1999 |
| Status | Completed |
| Previous Events | Signed: February 7, 2000
Approved: January 28, 2000 |
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Summary of Project Information (SPI)
| Project Name | Lithuania - Mediena |
RegionCentral and Southern Europe
Sector
| Projected Board Date | November 22, 1999 |
Company NameKlaipedos Mediena
Technical Partner and/or Major Shareholders
The project's main sponsor is the Industry and Finance Corporation of Western Lithuania (IFCWL), a privately owned investment company established in 1993. IFCWL's holding interests include companies in the wood industry, in the construction materials industry and in transport and stevedoring services. In addition to Klaipedos Mediena, IFCWL is a majority shareholder in three other wood processing companies: Klaipedos Kartonas, Egle, and Giriu Bizonas. Together with Klaipedos Mediena these process about one-third of all the wood used in Lithuania.
Project Cost Including proposed IFC investment
The estimated project cost is US$6.5 million. The proposed IFC investment consists of an A loan of up to US$1.25 million for IFC's own account and a convertible C loan of up to US$1.5 million.
Location of Project and Description of site
The project is located in the seaport town of Klaipeda, the third largest town in Lithuania. Klaipeda features one of the larger year-round open seaports in the Baltics, with convenient shipping available throughout the Baltics, Western Europe and overseas. Roads and rail connect Klaipeda with the inland. A small nearby airport, Palanga, has convenient direct flights to Finland and Germany. Vilnius, the capital of Lithuania, is 330 km south east of Klaipeda.
The factory is located at the eastern edge of the town of Klaipeda, along the main road to Vilnius and close to the north-south transit road system. The site of the company is 27 ha. Main production buildings were erected in 1900, 1922, 1946, and 1988, and occupy about 32,000 mē. Railway spurs feed to several parts of the factory, including the log yard and warehousing.
Description of Company and Purpose of Project
Klaipedos Mediena was first established in 1898 by a Belgian company, became state-owned in 1936 and was privatized in 1992. Its existing production facilities consist of a particleboard mill and a plywood mill. The company's main product lines are raw particleboard, plywood, bent plywood and veneer. The company is the only producer of plywood in Lithuania and is one of the two major producers of particleboard in the country. Klaipedos Mediena is currently operating at full capacity.
The proposed project consists of the modernization and financial restructuring of Klaipedos Mediena. The main component of the modernization aspect of the project consists of the purchase and installation of a particleboard laminating line and a veneer joiner. The laminating line will improve product quality and efficiency of particleboard production. The veneer joiner will reduce veneer waste by enabling the company to join small veneer pieces into large sheets of plywood. The financial restructuring aspect of the project consists of the refinancing of US$1.75 million of existing loans.
By financing the project, IFC will support an export sector that is of vital importance to the Lithuanian government. Long-term commercial financing is still quite limited in Lithuania and without IFC’s involvement, Klaipedos Mediena would have to rely on limited and expensive sources of funds. The primary development contribution of the project is the modernization of a company with long historical roots which, without the project, would likely operate at sub-optimum levels and not be able to compete in the long run. The project will also significantly increase the value-added production of the Lithuanian wood industry, one of the few natural resources of Lithuania.
Environmental Category and Issues
This a category B project according to IFC’s environmental review procedure. Potential environmental, safety and health issues of this project which were reviewed included: application of sustainable forestry management and harvesting techniques; air emissions; liquid effluent handling; solid and hazardous waste handling and disposal; use of formaldehyde in resins; fire protection and emergency response; and general worker health and safety, including exposure to dust and vapors. The plant is located in an industrial area, and there are no site issues arising. Wood supply (primarily birch) is from forests in the region, which are intensively managed for sustainability by the state Forest Service. Steam is produced from boilers fueled with natural gas and wood waste. Stack emissions from the boiler house meet both national standards and World Bank Group guidelines. Finishing operations are fitted with dust collection systems, and the product meets European E1 standards for formaldehyde release. Process wastewater and sanitary waste is discharged to a newly-constructed municipal wastewater treatment facility. The solid wood waste generated by the production lines is used as fuel for the boilers. Comprehensive fire protection systems are installed, including hydrants, extinguishers and alarm systems. There is an emergency response plan for the operation, and training in health and safety and fire protection is provided to all employees. The project will be constructed and operated in compliance with World Bank Group policies and guidelines.
The is available from the InfoShop.
| Host country location of environmental documents | Klaipedos Mediena
Liepy str. 68
LT-5799 Klaipeda
Lithuania
World Bank, Lithuania Office
Vilniaus St. 28
Vilnius 2600
Lithuania |
Date SPI sent to InfoShop October 8, 1999
“This Summary of Project Information is prepared and distributed to the public in advance of consideration of the proposed transaction by the Corporation’s Board of Directors. It is provided for the purpose of enhancing the transparency of IFC’s activities and should not be construed as presuming the outcome of IFC Board consideration.”
For Additional Information contact: Corporate Relations Unit -
telephone: (202) 473-7711
facsimile: (202) 974-4384 |
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| Environmental documents for this project are available at http://www.ifc.org/projects and from the World Bank InfoShop (http://www.worldbank.org/html/pic/aboutinfo.html). |
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