Porto de Sergipe LNG Power Plant
The project, located in the State of Sergipe in the Northeastern part of Brazil, consists of the design, construction and operation of a 1,500 MW combined cycle natural gas fired power plant, a 33km transmission line and associated facilities – including a marine regasification terminal, a submarine gas pipeline, and water intake as well as outflow pipes (the “Project”). The total Project cost is approximately US$1.3 billion. It is anticipated that the IDB/IIC financing will consist of a combination of Brazilian Reais and US Dollar financing for an amount of US Dollar 238 million equivalent.
IIC and the Inter-American Development Bank Group will provide long term financing in Brazilian Reais which is not available in the market. The plant will be the largest thermal power plant in South America. The plant will increase firm energy capacity in Brazil and will help to reduce the carbon emission by displacing carbon intensive plants fueled by oil and coal.
Based on the information available, the Project has been preliminary classified as a Category A according to IIC’s Environmental and Social Sustainability Policy due to the following key environmental, social, health and Safety (ESHS) risks and impacts: 1) during construction works, which include the generation of: (i) noise and vibration; (ii) dust and particulate material; (iii) solid waste; (iv) social impacts arising out of interference with commercial establishments and/or access to public social infrastructure and potential livelihoods displacement; (v) health and safety risks to construction personnel and local residents; and (vi) potential impacts to critical habitats and important biodiversity; 2) During the operational phase the main impacts are related to (i) noise, (ii) visual interference, (iii) increased traffic, (iv) cumulative effects, (v) air emissions, (vi) effluents, (vii) solid waste, and (viii) health & safety and community risks related to risks of spills/leaks/explosions and natural disasters.
An initial assessment of the Project’s Environmental Impact Assessment (EIA) indicates that it has not adequately assessed the likely key risks and impacts listed above. The IIC is collaborating and guiding the client in the way the company addresses the filling of gaps in legal compliance, project scope and design, additional environmental impact assessment studies, and in elaborating detailed Environmental and Social Management Plans (ESMP) for the construction and operational phases.
The permitting process for thermal power plant and the transmission line are under the purview of the Sergipe state permitting agency (ADEMA), which has already issued a Preliminary Environmental Permit (LP), which allows the developer to break ground and start preparation for construction works. Conversely, responsibility (i.e. remit) for issuance of the LP environmental permit for the remaining Project components of marine regasification terminal, submarine gas pipeline, and water intake as well as outflow pipes may fall with the Federal Environmental Agency (IBAMA), which is currently reviewing the preliminary Project documentation in order to decide whether it, or ADEMA, will carry out this task.
The IIC will conduct a full environmental and social (E&S) appraisal (due diligence) that will include document review, site visit, and meetings with key stakeholders. The E&S due diligence will also involve the input of external, specialized expertise by way of an independent E&S project consultancy firm. During the environmental and social due diligence the IIC and the consultant will further assess the Project’s key risks, evaluate environmental and social management gaps with respect to its E&S Sustainability Policy, and propose mitigation measures in the form of an environmental and social action plan (ESAP), to be agreed upon with the client. In addition, an environmental and social review summary (ESRS) will be prepared and posted on the IIC’s website once the due-diligence visit is conducted.
The following documents are part of the EIA package. With the exception of the English version of the EIA’s Executive Summary, all others are in Portuguese:
1) EIA_rev_00_v05 (main EIA document)
2) RIMA_rev_01_en and RIMA_rev_01 (executive summary)
4) RAS_rev_00_Base de Regas
5) RAS_rev01(Linha de Transmissão)
6) EIA Supporting documents (contains a series of 18 documents containing the annexes of the EIA)
7) EIA Maps (contains a total of 19 maps).