Mozambique - Beira Railway Project

Integrated Safeguards Data Sheet (Updated) Report No: AC372 Section I - Basic Information Date ISDS Prepared/Updated: 10/28/2003 A. Basic Project Data (from PDS) I.A.1. Project Statistics Country: MOZAMBIQUE Project ID: P082618 Project: Beira Railway Project Task Team Leader: Anil S. Bhandari Authorized to Appraise Date: March 15, 2004 IBRD Amount ($m): Bank Approval: July 15, 2004 IDA Amount ($m): 0.00 Managing Unit: AFTTR Sector: Railways (100%) Lending Instrument: Specific Investment Loan (SIL) Theme: Other financial and private sector Status: Lending. Bank's support will be estimated after development (P); Other public sector governance (S) selection of the successful bidder. I.A.2. Project Objectives (From PDS): The main objective of the proposed Project is to: (i) make cost effective and efficient transport available for the freight and passenger traffic in the central region of Mozambique and the neighboring countries of Malawi and Zimbabwe; and (ii) improve the operational and financial sustainability of the Beira railways system. An efficiently performing railway system will: (i) make Mozambican exports from the central region globally more competitive; and (ii) accelerate economic growth in the Zambezi Valley. The Project will support BOT-type concessioning of the rail system aimed at rehabilitation to standards adequate to carry the freight traffic on-offer and strengthen functioning of the regulatory body. I.A.3. Project Description (From PDS): Project Description The rehabilitation work shall be carried out in accordance with the designs to be established by the Conceding Authority as per the Concession Agreement. This will enable the system to carry all freight traffic on-offer including coal currently produced but excluding large scale coal transport expected as a result of coal concession. The concessionaire would be responsible for handling all traffic on-offer and for establishing adequate capacity for such traffic. Once the coal concession is operational, the concessionaire would be responsible for creating capacity for the increased traffic volumes. However, if the railway concessionaire is unable to negotiate acceptable terms for upgradation of the Sena line to handle the additional coal traffic, the conceding authority shall have the right to terminate the concession as per the conditions laid out in the concession agreement The proposed project would comprise three components: (a) railways concessioning (TA); (b) infrastructure rehabilitation; and (c) strengthening of the regulatory framework. In the short-to-medium term (prior to coal concessioning) the economic benefits are expected to be substantial and justify rehabilitation of the line. In the long-term, the operation of the line would bolster investor confidence and interest to participate in the coal concessioning. However, as the project is not likely to be financially viable in the short run, the proposed rehabilitation of the Sena rail line would require high share of public finance/concessionary loans. To make the concession biddable, the Government has agreed to provide long maturity loans on concessionary terms. The Conceding Authority will award the concession to the bidder whose bid has been determined to be substantially responsive to the bidding documents and who has offered the lowest present value of support required. The Bank's financing will be  2 ISDS estimated based on Government's assessment of the support required after selection of the successful bidder. The total project cost is estimated at US$100.00 million. I.A.4. Project Location: (Geographic location, information about the key environmental and social characteristics of the area and population likely to be affected, and proximity to any protected areas, or sites or critical natural habitats, or any other culturally or socially sensitive areas.) The Beira Railways System. The Beira rail system comprises two rail lines: (a) a 317-km Machipanda line linking the port of Beira to the railway network in Zimbabwe; and (b) a 600-km Sena line linking the port of Beira to the Moatize coal fields with a small spur linking the system to the rail network in Malawi. The two lines take off from Beira and bifurcate at Dondo, a station about 28 kms. from Beira. The Machipanda line goes in the Westerly direction up to the border station of Machipanda, where it links to the Zimbabwe rail network at Mutare station. The Machipanda line is heavily graded which consequently limits the train load. The Sena line takes off from the Machipanda line at Dondo and goes in a North, North-Westerly direction, crossing the Zambezi river between Sena and Dona Ana (298 Km from Dondo). The line again bifurcates at Dona Ana, a 254 Km line runs on the North bank of the Zambezi river to the Moatize terminal station and a short 44 km line runs North to Vila Nova Frontiera where it links up with the Malawi railway system. There is, in addition, an 88-Km branch line running due East from Inhamitinga to Marromeu on the South bank of the Zambezi. The line is graded in parts, particularly, for the first 36 kilometers while starting from Moatize. B. Check Environmental Classification: B (Partial Assessment) Comments: The Sena line was operational until 1983. It is only being rehabilitated and no additional line is being built. The rehabilitation work involves changing the rails and sleepers, replenishing ballast and establishing signaling and communication equipment. No major earthwork is being undertaken and there is no cutting of or filling of land. A full environment assessment was made for the on-going Railways and Ports Restructuring Project (RPRP), which is valid for the proposed project as well. This EA report will be revised in accordance with project objectives and disclosed prior to appraisal. The main issues are: (i) the line along with five meters on each side has been de-mined. However, this is not satisfactory and it would be a condition of effectiveness of the project that the area of 30 meters on either side is de-mined; and (ii) the line is fitted with wooden sleepers, which would have affected the forests. A decision has been taken to use only concrete sleepers except at a very few locations where nonstandard sleepers need to be used. However, since the assessment was made a few years ago, the report will be updated through a supplemental study. The objectives of the study would be to: (i) determine the environmental baseline conditions at, and in the vicinity of the Beira rail operational site, including the Sena line; (ii) evaluate the current institutional and legal framework and propose new regulations, whenever considered necessary; and (iii) formulate an Environmental Audit Management Plan for the Beira railways system. C. Safeguard Policies Triggered (from PDS) (click on for a detailed desciption or click on the policy number for a brief description) Policy Triggered Environmental Assessment (OP 4.01, BP 4.01, GP 4.01) Yes No TBD Natural Habitats (OP 4.04, BP 4.04, GP 4.04) Yes No TBD Forestry (OP 4.36, GP 4.36) Yes No TBD  3 ISDS Pest Management (OP 4.09) Yes No TBD Cultural Property (OPN 11.03) Yes No TBD Indigenous Peoples (OD 4.20) Yes No TBD Involuntary Resettlement (OP/BP 4.12) Yes No TBD Safety of Dams (OP 4.37, BP 4.37) Yes No TBD Projects in International Waters (OP 7.50, BP 7.50, GP 7.50) Yes No TBD Projects in Disputed Areas (OP 7.60, BP 7.60, GP 7.60)* Yes No TBD Section II - Key Safeguard Issues and Their Management D. Summary of Key Safeguard Issues. Please fill in all relevant questions. If information is not available, describe steps to be taken to obtain necessary data. II.D.1a. Describe any safeguard issues and impacts associated with the proposed project. Identify and describe any potential large scale, significant and/or irreversible impacts. As observed earlier, there were two main environmental issues (use of wooden slippers and clearing of area within 5 meters of the railway line) and both have been resolved under the on-going RPRP. The clearing of area within 30 meters of the railway line will be a condition of effectiveness. During preparation, a study will be conducted to: (i) establish environmental base line conditions and examine the present institutional and legal framework; (ii) assess the physical, biological and socio-cultural environment; (iii) formulate an Environmental Audit and Management Plan which encompasses environmental mitigation, monitoring and research, contingency plans, emergency response plans and health and safety plans; (iv) evaluate the institutional issues relevant to establishing a well functioning rail operation from an environmental point of view and recommend improvements and institutional changes as needed. The study would also review the Mozambique Railways Act and address the environmental management obligations of the concessionaire. In addition, the study would undertake an inventory of people and property on railway land on the Machipanda and Sena rail line systems and particularly of those people who might be living too close to the railway tracks, thus compromising operational safety. Once the inventory is completed and any problems identified, a separate Resettlement Action Plan will be developed for displaced people and/or for the compensation of damaged property (if required), as appropriate and consistent with OP 4.12. The specific actions, including environmental management obligations of the concessionaire would be developed based on study findings and recommendations. The study will also identify accumulated liability, the liquidation of which will be the responsibility of CFM II.D.1b. Describe any potential cumulative impacts due to application of more than one safeguard policy or due to multiple project component. TBD II.D.1c Describe any potential long term impacts due to anticipated future activities in the project area. TBD II.D.2. In light of 1, describe the proposed treatment of alternatives (if required) De-mining of the area within 30 meters of the railway line will be a condition of effectiveness.  4 ISDS II.D.3. Describe arrangement for the borrower to address safeguard issues Under the RPRP a comprehensive safety, health and environment (SHE) policy has been developed. The social issues of staff retrenchment consequent to concessioning are being addressed satisfactorily under the on-going RPRP. II.D.4. Identify the key stakeholders and describe the mechanisms for consultation and disclosure on safeguard policies, with an emphasis on potentially affected people. Public consultation will be carried out with local population, local NGO's and local and central government. Disclosure will be done in-country and in the InfoShop prior to appraisal. E. Safeguards Classification (select in SAP). Category is determined by the highest impact in any policy. Or on basis of cumulative impacts from multiple safeguards. Whenever an individual safeguard policy is triggered the provisions of that policy apply. [ ] S1.