The “Environmental Remediation Pilot Project” (ERPP) was designed to mitigate severe environmental contamination at the MDK copper smelter and refinery in Pirdop, in operation since 1957. When the Belgian metallurgical group Umicore acquired MDK, an environmental Remediation Program was designed in cooperation with the World Bank as a part of the privatization deal. The main objectives of the ERPP are to (i) reduce environmental hazards caused by past pollution at MDK; (ii) contribute to improvements in the environmental performance of the plant; and (iii) facilitate the privatization of MDK by reducing uncertainties and concerns of strategic investor(s) about environmental liability issues.
The Program consists of:
Part A - Emergency clean-up of immediate environmental hazards, and;
Part B - Clean-up of critical past environmental damage.
Project financing is being provided by: the NTEF, through a grant of 3.3 million USD for equipment procurement under Part A (successfully completed in November 1999); the World Bank, through a loan for 16 million USD to the Bulgarian Government, and; the Bulgarian Government, through grants for a total of 5.7 million USD. Based on the Implementation Agreements respectively for Part A (signed on March 27, 1998) and Part B (from June 02 1998), Union Miniere Pirdop Copper (UMPC) is the Implementing Agency for the Program while the NTEF is the Project Coordination Agent based on an Agency Agreement between the MoEW, as representative of the Government of Bulgaria, and the NTEF.
With its contribution of 3.3 million USD, this Program is the Fund’s largest project and major achievement in one of the four priority areas. Its engagement as a Coordinating Agent for Part B of the Program has imposed a wide range of responsibilities, including:
- examination and preparation of expertise on technical designs;
- examination and approval of technical specifications;
- examination and approval of tender documents and procedures;
- examination and approval of draft contracts with contractors and suppliers;
- examination, control and approval of completed works;
- preparation and presentation of progress reports to the Program Oversight Committee and the World Bank, and;
- preparation and submitting requests for withdrawal of funds from the Bank loan.
The collaboration between the Bank and NTEF on the Program became a very positive experience for both and explains the Bank’s strong support for the Fund.