Notice of Publication and Request for Comments

INTERNATIONAL DEVELOPMENT COOPERATION AGENCY

Overseas Private Investment Corporation

Notice of Publication and Request for Comments

AGENCY: Overseas Private Investment Corporation, IDCA.

ACTION: Notice of Publication and Request for Comments.

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SUMMARY: The Overseas Private Investment Corporation (OPIC) has

published an ``Environmental Handbook'' which represents the current

environmental policies and procedures in use at the Agency. Section

231(n) of the Foreign Assistance Act of 1961 (Title 22 U.S.C. 2191

(k)(2)), as amended, requires OPIC to: ``Refuse to insure, reinsure,

guarantee, or finance any investment in connection with a project which

the Corporation determines will pose an unreasonable or major

environmental, health, or safety hazard, or will result in the

significant degradation of national parks or similar protected areas.''

The Handbook was published to consolidate a number of sources of

information into a single, easy-to-review and easily accessible

document. This Handbook is also available on OPIC's Internet web site

at www.OPIC.gov. Comments on the Handbook and its content are being

invited for Agency consideration. OPIC intends to consider revising the

Handbook based upon the comments received. OPIC encourages all

interested parties to respond within 120 calendar days of publication

of this Notice. The entire text of the Handbook appears below.

DATES: Comments must be received on or before June 6, 1997.

ADDRESSES: Comments should be submitted to Mr. Harvey Himberg,

Environmental Affairs, Overseas Private Investment Corporation, 1100

New York Ave., NW., Washington, DC 20527 USA.

FOR FURTHER INFORMATION CONTACT: Contact Mr. Himberg by phone at 202/

336-8414, by fax at 202/218-0177 or via Internet e-mail at /S=himberg/

G[email protected].

TEXT OF HANDBOOK:

OPIC ENVIRONMENTAL HANDBOOK

December 1996

INTRODUCTION: STATEMENT OF PURPOSE AND OBJECTIVES

This Handbook is intended to provide guidance to OPIC's clients,

as well as the interested public, with respect to the environmental

standards, assessment and monitoring procedures that OPIC applies to

prospective and ongoing investment projects. The standards and

procedures described in this Handbook generally reflect existing

practice at OPIC as it has evolved since the enactment in 1985 of

statutory environmental provisions applicable to OPIC. (The

environmental provisions contained in OPIC's statute are reprinted

in Appendix A.) (OPIC is also subject to Executive Order 12114,

``Environmental Effects Abroad of Major Federal Actions.''

Environmental Assessment Procedures for EO 12114 are included in

Appendix A.)

Since 1985, OPIC has been required by statute to assess the

environmental impacts of projects under consideration for political

risk insurance and financing. OPIC's authorizing statute was amended

at that time with the congressional intent of ensuring that ``great

care * * * be paid to assuring the environmental soundness of U.S.

Government supported foreign assistance projects.'' This is

particularly important given OPIC's self-sustaining mandate. OPIC

strongly supports these principles on their own merits.

In addition, it is increasingly evident that responsible and

proactive environmental assessment and management enhance the

competitiveness of U.S. investors, as well as project developers,

suppliers and contractors associated with overseas investment

projects.

Whereas public policy considerations have spurred multilateral

and bilateral financial institutions such as OPIC to take the lead

in addressing environmental issues in project finance and political

risk insurance, private financial institutions both in the U.S. and

overseas also have recently begun to integrate environmental

concerns into their lending and insurance criteria.

Corporations themselves, through such initiatives as the ISO

14000 process, have undertaken to standardize environmental

management, auditing and labeling on an international basis. (ISO is

the International Standards Organization, a voluntary membership

body composed of private sector companies.)

Over the years OPIC has worked with counterpart organizations

providing similar services to investors in the U.S., overseas and on

a multilateral basis as environmental procedures were developed.

Many of the OPIC standards and procedures described in this Handbook

are also applied by organizations such as the International Finance

Corporation (IFC) and the Multilateral Investment Guarantee Agency

(MIGA), both affiliates of the World Bank; the European Bank for

Reconstruction and Development (EBRD); and the U.S. Export-Import

Bank (US Exim). In OPIC's experience, the application of standards

and procedures similar to those used by these organizations has

facilitated co-financing and co-insurance arrangements and made it

simpler for clients to address environmental requirements.

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The Handbook is not designed to be a static document but rather

an evolving process. OPIC welcomes comments from business and public

interest organizations seeking to enhance OPIC's environmental

assessment and management process.

Environmental Assessment (EA)

By statute, OPIC is precluded from assisting any project that it

determines will pose an ``unreasonable or major environmental health

or safety hazard.'' (See Appendix A.)

Environmental assessment (EA) is the tool used by OPIC to make

this determination. The state-of-art of EA is steadily evolving

through experience with actual projects over time. EA is a

continuing activity through the life of a project, not a one-time

exercise. Effectively applied, it is integrated into the design and

operations of a project, rather than undertaken as an ``add-on'' to

satisfy a requirement external to the project. EA consists of

several stages of analysis--descriptive, prospective and

retrospective.

By statute, OPIC is required to provide some degree of EA to

every project considered for insurance or finance in determining

whether to provide support for the project. This requirement extends

to subprojects undertaken by OPIC-supported investment funds and on-

lending facilities. (See the discussion of financial intermediaries,

below.) OPIC cannot provide a final commitment to a project (i.e.,

issue an insurance contract, disburse a loan, or approve a

transaction by a financial intermediary) until its environmental

assessment is complete and a determination is made by OPIC that the

environmental, health and safety impacts of the project are

acceptable.

Different types of EAs are conducted by the applicant depending

on the nature of the project. The actual work may be conducted by

the applicant/sponsor or by a third party, such as an environmental

consultant. On the basis of its considerable experience in reviewing

such materials, OPIC can advise applicants regarding many aspects of

EA preparation.

EAs and other environmental reports should be provided to OPIC

as early as possible in the application process. This enables OPIC

to identify environmental issues that may require additional

attention before the EA can be considered to be complete.

Collaboration between OPIC and other official and private lenders

and insurers in reviewing environmental information is in the

interest of the applicant as it expedites the review process and

avoids delays and needless duplication with the requirements of

other lenders and insurers.

Once the EA is complete, OPIC will make every effort to review

the material within a two to four week time frame. In circumstances

where OPIC confronts a particularly full project pipeline, OPIC may

contract for outside expertise to enable it to complete the review

process in a timely manner.

In all cases, the cost of preparing the original EA is borne by

the applicant, sponsor or foreign enterprise. When OPIC engages

independent consultants to review all or part of the EA materials

submitted by the investor, to undertake an original assessment of

the project and/or to undertake a site visit as part of the

environmental review process, it requires the applicant to reimburse

the associated costs.

OPIC may require one or more of the following documents to

satisfy a project's EA requirements:

Environmental Impact Statement (EIS). By statute and Executive

Order (EO) 12114 (See Appendix A), OPIC is required to prepare, and

to take fully into account, an EIS for any project ``significantly

affecting the environment of the global commons outside the

jurisdiction of any nation (e.g., the oceans or Antarctica).'' Given

the discrete nature of projects assisted by OPIC, it is considered

unlikely that any single project assisted by OPIC would have a

sufficiently large impact on the global commons to warrant an EIS.

However, the cumulative impacts of several large projects could

conceivably have an impact on extraterritorial waters or the

atmosphere sufficient to trigger the requirement.

As prescribed by EO 12114, such an EIS should be concise and no

longer than necessary to permit an informed consideration of the

environmental effects of the proposed project and the reasonable

alternatives. It should include the following sections: (1) Purpose

and need for the proposed project; (2) a sufficient description of

the environment of the global commons affected by the proposed

action; (3) an analysis, in comparative form, of the environmental

consequences on the global commons of the proposed action; and (4)

reasonable alternative means of structuring the project.

In lieu of preparing a new EIS, the Executive Order permits OPIC

to rely on one of the following: A pre-existing EIS for the same

project; a project involving similar environmental issues; a generic

EIS covering a number of similar projects; or an EIS obtained by

other agencies.

Environmental Impact Assessment (EIA). An EIA is a comprehensive

assessment of the diverse impacts of a project on the natural and

human environment. It includes a detailed description of pre-

existing conditions (``baseline assessment''), all project

activities having a potential environmental impact (from pre-

construction through decommissioning and site reclamation), and the

net impacts of the project, taking into account alternative

mitigative measures. It also considers the relationship of the

project to the natural and human environment in the affected area

and the cumulative impacts of those activities. The content and

format for an EIA will vary depending on industry sector, the site

and other project-specific factors. (A generic format for an EIA is

provided in Appendix B.)

Environmental Management and Monitoring Plan (EMMP). An EMMP is

designed to specify in detail the actions--both technical and

managerial--that the applicant or sponsor will undertake in order to

mitigate anticipated adverse impacts of the project on the

environment, health and safety. It also describes the technology and

methodology used to monitor the actual impacts of the project on the

environment and the standards and procedures to be used for

adjusting mitigative measures as necessary to maintain impacts

within an acceptable range. (A generic format for an EMMP is

suggested in Appendix C.) While ISO 14000 Environmental Management

Systems implementation is not a substitute for a project-specific

EMMP, a project sponsor's adherence to the ISO criteria can

facilitate the process of developing an acceptable EMMP.

Major Hazard Assessment (MHA). An MHA is a specialized form of

EA designed to identify and assess the risks of catastrophic events

resulting from the operation of an industrial facility. For projects

requiring an MHA, OPIC requires completion of the MHA, preferably as

part of the EIA process, but no later than the commencement of

project operations. The categories of facilities subject to an MHA

as well as the content and format of an MHA are outlined in the

``World Bank Guidelines for the Identification, Analysis and Control

of Major Hazard Installations in Developing Countries,'' a copy of

which is available from OPIC.

Environmental Audit (EAU). If the investment involves the

acquisition of a pre-existing facility or a site on which industrial

activity previously occurred, the project may also be subject to an

EAU. An EAU is designed to identify pre-existing adverse

environmental, health or safety conditions that could affect future

impacts from the facility or site. (A generic format for an EAU is

suggested in Appendix D.) ISO Environmental Auditing criteria are a

useful adjunct to, although not a substitute for, performance-based

auditing that is required to meet OPIC EAU requirements.

Environmental Remediation Plan (ENR). The project may involve

the remediation of environmentally adverse conditions at a site. In

this case the applicant will be required to provide OPIC with an

ENR, similar in format to an EMMP, and designed to address the

issues raised in the audit.

An EMMP, EAU or ENR may be included as part of an EIA. Other

documents prepared to satisfy the requirements of other lenders may

be submitted to OPIC so long as the documentation addresses the

substantive issues needed for OPIC to complete its review of the

project.

Screening

The type of EA required for a particular project, including the

timing and the level of effort involved, depends upon the nature of

the project. Therefore, the first step in OPIC's EA is screening, in

which OPIC's Environmental Unit assigns each project to one of the

following categories:

Category A: Projects in this category can be expected to have

potentially significant, diverse and irreversible environmental

impacts. Such projects can be readily identified on the basis of

industry sector or site sensitivity. They require a full-scale EIA,

as well as an EMMP. A fairly comprehensive

[[Page 5647]]

list of industries and sites within this category is provided in

Appendix E. Category B: Projects in this category may result in

specific environmental impacts and require adherence to certain

predetermined performance standards, guidelines, or design criteria

to avoid or mitigate impacts. Due to their nature, size or location,

such projects can be readily assessed in terms of their

environmental impacts and mitigation measures can be readily

identified. Projects not included in Categories A, C, or D (as

defined above and below) can be expected to belong to Category B.

Examples of such project categories include: Agriculture, electrical

distribution, electronics, food processing, light manufacturing,

telecommunications, textiles and tourism. Information required from

the applicant typically includes the following: Site description;

processes involved; materials used and stored on site; air, liquid,

and solid wastes generated in relation to applicable standards; and

occupational health and safety measures.

Category C: This category includes projects that are normally

exempt from all environmental assessment, analysis or review because

they do not normally result in any environmental impact. Examples of

such projects include branch banking and computer software

development.

Category D: This category includes financial intermediaries

(FIs) that make investments in or provide financing (loans, leases,

etc.) to multiple projects or enterprises (``subprojects'') engaged

in activities within categories A and B. OPIC screens these

subprojects to determine the type of environmental review required.

Also taken into account is the nature and size of the FI's

involvement in the subproject. Expedited reviews are conducted for

Category B subprojects involving less than $5.0 million in

investment, subject to further review if the FI proceeds with

additional investments in the same subproject.

Environmental Standards

All projects must comply with host country environmental

regulations. In addition, for most categories of activities, OPIC

requires that projects meet World Bank environmental, health and

safety guidelines. Therefore, whenever possible, applicants should

provide OPIC with summaries or copies of applicable host country

regulations as part of their EIA (for Category A projects) or as

information provided in support of their application (for Category B

projects). Government permits and certifications of compliance are

necessary in this regard, although not always sufficient to

establish compliance.

World Bank guidelines were most recently officially issued in

1988 and many of the guidelines themselves date from the early

1980s. For that reason, OPIC has opted to use the draft guidelines

prepared by the World Bank in May 1994 for the majority of

industrial categories. (Use of the 1994 draft guidelines is

consistent with the current practice of the International Finance

Corporation pending the issuance of revised World Bank guidelines.)

(For certain industries not included in the 1994 draft, OPIC may

consider compliance with the 1988 guidelines acceptable.) As the

Bank continues to update its guidelines, OPIC will substitute more

current versions of particular guidelines on a case-by-case basis by

industry. (A comprehensive list of official and draft World Bank and

U.S. Exim guidelines for industry sectors as well as ecologically

sensitive sites is contained in Appendix F. All are available from

OPIC on request).

For certain environmentally sensitive industries or

circumstances, OPIC may require a project to meet a more restrictive

standard than the World Bank guidelines, including, in some cases,

emissions, effluent, ambient air and water quality limitations set

by the U.S. Environmental Protection Agency, the World Health

Organization or a similar authority.

OPIC does not attempt to prescribe to its potential clients the

choice of technologies or processes they must use to meet the

applicable guidelines. However, standards of best practice developed

by governments, industry and non-governmental organizations can be

useful in providing guidance to OPIC and its clients in assessing

alternatives and their feasibility. For this purpose OPIC is

developing, in consultation with experts, international best

practice guidelines for three sectors of particular importance to

OPIC's mandate with respect to environmental impact: power

generation; metals mining; and forestry (both tropical and

temperate/boreal). Copies of these best practice guidelines will be

available from OPIC on request.

Eligibility Determinations

The primary purpose of OPIC's environmental review is to

determine the eligibility of the project based on OPIC's statutory

obligation to decline support for projects posing ``unreasonable or

major environmental, health or safety hazards''. OPIC interprets

``health or safety'' to apply both to project employees and to the

affected public living or working in the vicinity of the project.

In addition, OPIC is also required by statute to operate its

programs in a manner consistent with sections 117, 118 and 119 of

the Foreign Assistance Act (FAA). These provisions pertain to

environmental assessment, and the protection of tropical forests and

endangered species, respectively.

Grounds for Declining Assistance to Projects. There are several

circumstances under which OPIC will decline support for a project on

environmental grounds:

The applicant fails to provide OPIC with an EIA for a

Category A project or with adequate information about a Category B

project to conduct a review sufficient to determine project

eligibility on environmental grounds.

The project will, in OPIC's determination, result in

--Significant degradation of a national park, similar protected area

or tropical rainforest;

--The destruction of or significant degradation in the habitat of an

endangered species; and/or

--Other ``unreasonable or major environmental, health or safety

hazards.''

OPIC provides applicants with the opportunity to demonstrate

that the proposed project does not pose an ``unreasonable or major

environmental or safety hazard'' and is otherwise consistent with

the letter and intent of the FAA provisions. However, at one time or

another, OPIC has declined to support projects on one or more of the

above grounds.

Conditionality. In many cases, determinations of eligibility

rely on critical representations made by the client with respect to

baseline environmental conditions, mitigative measures and net

impacts of proposed projects. In addition to the EMMP or ENR

submitted by the applicant, OPIC may require the application of

additional mitigative measures in order to ensure that a project

will not pose an unreasonable or major environmental, health or

safety hazard. These critical representations and those undertakings

agreed to by the applicant or sponsor may be included in project

documentation as preconditions to contract execution, conditions of

disbursement and/or ongoing covenants, depending on the type of

agreement entered into between OPIC and the applicant. Where OPIC

insures an institutional lender, contract conditions are

incorporated into the loan documentation.

Environmental conditions and covenants are developed in close

consultation with the client to minimize the cost to the project and

to ensure that they are consistent with the host country's legal

framework, objectively measurable and verifiable, and allow for

sufficient flexibility to address issues if circumstances change.

Monitoring and Compliance

OPIC's environmental assessment process is an ongoing one and

continues through the full term of OPIC's relationship with the

project sponsor.

Monitoring. OPIC reserves the right to monitor projects'

compliance with environmental representations and undertakings

throughout the term of its insurance or financing. Monitoring may

take the form of self-reporting by the investor of summaries and, in

specified cases, raw data obtained from monitoring a project's

environmental performance (emissions, effluents or other waste

discharges) as well as its environmental impacts (e.g., on ambient

conditions and biological resources). Monitoring may also take the

form of third party evaluation, including compliance information

developed by host government authorities, co-lenders/co-insurers and

independent auditors.

OPIC routinely conducts on-site monitoring of projects, using

OPIC staff and/or consultants, for environmental as well as U.S.

economic and host country development effects. OPIC endeavors to

monitor all Category A projects on-site at least once during the

first three years of project commitment, and more frequently

depending on the environmental sensitivity of the project. Category

B and D projects are also subject to monitoring on a random and

selective basis.

Non-compliance, Remediation and Termination. Material non-

compliance with environmental representations and

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undertakings may constitute an event of default under the terms of

OPIC insurance contracts and loan agreements. Depending on the

severity and reversibility of the environmental impact and the

investor's responsibility and due diligence in attempting to prevent

the default and in curing the problem, OPIC may treat the default as

curable or incurable. In the case of a curable default, OPIC works

cooperatively with the investor to develop a feasible timetable for

remediation. In the case of an incurable default, OPIC may require

contract termination in the case of insurance, or acceleration of

repayment or other available lenders' remedies, in the case of a

loan. If an equity investment on the part of an FI is involved,

divestiture by the FI may be required. In all cases, OPIC seeks to

work cooperatively with investors and lenders to arrive at an

equitable resolution of the situation, subject, of course, to the

requirements of other lenders and insurers.

Public Consultation and Disclosure

The environmental assessment process has become an increasingly

public and transparent process among environmental regulatory

agencies in the United States and in some, although not all, foreign

countries. Likewise, multilateral development agencies that provide

assistance to governments and other public sector clients have also

made their activities more transparent to the public in both donor

and host countries.

OPIC recognizes the added value that interested and well-

informed members of the public can bring to the environmental

assessment process undertaken by its clients as well as by OPIC

itself. Grass roots as well as international non-governmental

organizations (NGOs) often have access to information and

perceptions about potential environmental impacts and resulting

social, economic and cultural impacts that need to be carefully

considered as early as possible in the assessment process.

At the same time, the plans and proposals of private sector

investors are often business confidential, and, in such cases, must

be strictly protected from disclosure. While OPIC is subject to the

disclosure requirements of the Freedom of Information Act, those

requirements contain an exemption for business confidential

information that is protected from disclosure under the Trade

Secrets Act.

In submitting project-specific information to OPIC, including

Environmental Impact Assessments, audits, management and remediation

plans as well as monitoring reports, applicants must specify which

information has been or will be made public in any format, including

in the host country. Because OPIC's goal is to provide the public

with a level of comfort about its environmental process, applicants

are strongly encouraged to submit environmental information in a

form that can be shared with the public without compromising

business confidentiality. Any information that is identified as a

public document will be treated as such by OPIC in a response to a

specific request for such information. Business confidential

information will be accorded confidential treatment to the full

extent permitted by law.

When OPIC receives an application for insurance or financing for

an environmentally sensitive project or subproject (coinciding with

all projects within Category A, as defined above) OPIC will list the

nature of the project and its location on OPIC's Home Page on the

World Wide Web (http://www.opic.gov). No business confidential

information will be disclosed. This list will be updated monthly,

and any comments received will be considered in OPIC's processing of

the application. Additional information about projects may be

provided to OPIC at any time throughout the term of the project.

Questions about this Environmental Handbook should be addressed

to the Director, Environmental Affairs, Overseas Private Investment

Corporation, 1100 New York Avenue, NW, Washington, DC 20527; Phone

(202) 336-8614; Fax (202) 218-0177.

Appendix A--OPIC Statute (Environmental Provisions)

All references are to the Foreign Assistance Act of 1961 (FAA),

as amended, most recently by the Jobs Through Exports Act of 1992.

Section 231 * * *. The Corporation, in determining whether to

provide insurance, financing or reinsurance for a project, shall

especially--

(3) ensure that the project is consistent with the provisions of

section 117, (as so redesignated by the Special Foreign Assistance

Act of 1986), section 118, and section 119 of this Act relating to

the environment and natural resources of, and tropical forests and

endangered species in, developing countries, and consistent with the

intent of regulations issued pursuant to sections 118 and 119 of

this Act.

In carrying out its purpose, the Corporation, utilizing broad

criteria, shall undertake--

(n) to refuse to ensure, reinsure, guarantee or finance any

investment in connection with a project which the Corporation

determines will pose a major or unreasonable environmental, health

or safety hazard, or will result in the significant degradation of

national parks or similar protected areas.

Section 237. General Provisions Relating to Insurance, Guaranty and

Financing Programs

(m)(1) Before finally issuing insurance, reinsurance,

guarantees, or financing under this title for any environmentally

sensitive investment in connection with a project in a country, the

Corporation shall notify appropriate government officials of that

country of--

(A) All guidelines and other standards adopted by the

International Bank for Reconstruction and Development and any other

international organization relating to the public health and safety

or the environment which are applicable to the project; and

(B) To the maximum extent practicable, any restriction under any

law of the United States relating to public health or safety or the

environment that would apply to the project if the project were

undertaken in the United States.

The notification under the preceding sentence shall include a

summary of the guidelines, standards and restrictions referred to in

subparagraphs (A) and (B), and may include any environmental impact

statement, assessment, review or study prepared with respect to the

investment pursuant to section 239(g).

Section 239. General Provisions and Powers

(g) The requirements of section 117(c) of this Act relating to

environmental impact statements and environmental assessments shall

apply to any investment which the Corporation insures, reinsures,

guarantees, or finances under this title in connection with a

project in a country.

Environmental Assessment Procedures for Executive Order 12114

On January 4, 1979 the President issued Executive Order 12114

(44 FR 1957) entitled ``Environmental Effects Abroad of Major

Federal Actions''. The Executive Order requires federal agencies

taking action encompassed by the Order, and not exempted from it, to

effectuate procedures to implement the Order. The Overseas Private

Investment Corporation (OPIC) is implementing the Executive Order by

the adoption of the following procedures to take effect on September

4, 1979.

Section 1. Purpose

As required by Executive Order 12114, issued January 4, 1979,

which is incorporated herein by reference, the following procedures

shall be used by OPIC to ensure that all significant environmental

effects of its actions outside the United States are considered by

OPIC in its review of proposed insurance and finance projects. These

procedures shall supplement OPIC's existing environmental procedures

and guidelines required by the Foreign Assistance Act as amended

(the ``Act''), as set forth in OPIC Board of Directors Resolution

(74) 16 * * * and the ``OPIC Environmental Handbook''.

Section 2. Definition

A. Application. The term ``application'' means a formal request

to OPIC in the manner specified by OPIC for assistance under an OPIC

program from an eligible private party interested in investing in a

project in a foreign nation.

B. Environment. The term ``environment'' means the natural and

physical environment and excludes social, economic, and other

environments.

C. Global Commons. The term ``global commons'' means areas

outside the exercise of any national jurisdiction.

D. Host Country. The term ``host country'' means the foreign

country in which a project for which OPIC assistance is sought is or

will be located.

E. Major Action. The term ``major action'' means a contractual

commitment by OPIC to provide assistance under an OPIC program

involving at least $1 million of insured investment, loan guaranties

or direct loans, if the applicant therefor has or will have

sufficient control over the design and/or operation of the project

to mitigate environmental concerns raised by OPIC.

F. OPIC Programs. The term ``OPIC programs'' includes OPIC's

insurance, direct loan and loan guaranty programs as authorized by

the Act.

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G. Significant Effects. With respect to effects on the

environment outside the United States, a proposed action has a

significant effect on the environment if it does significant harm to

the environment even though on balance the action is believed to

result in beneficial effects on the environment.

Section 3. Applicability of Procedures

A. Scope. Except as provided in Subsections B, C, and D below,

these procedures shall apply with respect to OPIC's review of each

new application for assistance under an OPIC program, whether for

new projects or expansions of existing projects, if a favorable

decision on such application will result in a major action by OPIC.

B. Exemptions. If upon the initial review of an application the

OPIC insurance or finance officer making such review determines that

the project for which OPIC assistance is sought has no significant

effects upon the environment outside the United States, these

procedures shall not apply. If upon further review of the

application, and prior to taking action, it is determined that the

project may have a significant effect upon the environment, this

exemption shall no longer apply. Also exempt from these procedures

are actions falling within the categories listed in Section 2-5(ii)

through (vii) of the Executive Order, as limited by Section 2-5(d).

A concise administrative record will be prepared to document these

determinations.

C. Categorical Exclusions. These procedures shall not apply to

the review of an application for any project falling within the

scope of any category of projects which are determined to involve no

significant effects on the environment. OPIC's Investment Committee

shall have the authority to establish such categorical exclusions.

D. Special Exemptions. These procedures shall not apply to the

review of any application for which the General Counsel determines

that an exemption is necessary as a result of emergency

circumstances, situations involving exceptional foreign policy or

national security sensitivity or other special circumstances (except

as limited by Section 2-5(d) of the Executive Order). In utilizing

any such special exemption, OPIC, through its designated

Environmental Officer, shall consult as soon as feasible with the

Department of State and the Council on Environmental Quality.

Section 4. Initial Determinations

A. With respect to any application for OPIC assistance falling

within the scope of Section 3(A) above, the OPIC officer reviewing

such application shall make the following determinations which shall

be documented by a concise administrative record:

1. Whether the proposed project is likely to have a significant

effect on the environment of the global commons;

2. Whether the proposed project is likely to have a significant

effect on the environment of a foreign country other than the host

country; and

3. Whether the proposed project is likely to have a significant

effect on the environment of a foreign country because it would

provide to that country.

(a) A product, or physical project producing a principal product

or an emission or effluent, which is prohibited or strictly

regulated by Federal law in the United States because its toxic

effects on the environment create a serious public health risk, such

as asbestos, vinyl chloride, acrylonitrile, isocyanates,

polychlorinated biphenyls, mercury, beryllium, arsenic, cadmium, and

benzene; or

(b) A physical project which in the United States is prohibited

or strictly regulated by Federal law to protect the environment

against radioactive substances.

4. Whether the proposed project is likely to have a significant

effect on natural or ecological resources of global importance

hereafter designated for protection by the President or, in the case

of such a resource protected by international agreement binding on

the United States, by the Secretary of State.

B. The determination required in Subsection A above shall be

based upon the information contained in the application, information

reasonably available to OPIC and such additional information from

the applicant as deemed necessary by the reviewing officer.

C. In the event that the reviewing officer makes a positive

determination with respect to any of the categories specified in

Subsection A above (i.e. that a significant effect is likely to

result), and such determination is not reversed upon review by a

supervisory officer or by the Investment Committee, the finance or

insurance department, as the case may be, in consultation with

OPIC's Environmental Officer, shall take the following actions, as

appropriate, prior to acting on the application:

1. If the harmful effect is of the type described in Subsection

A(1) above, an environmental impact statement shall be obtained in

the manner specified in Section 5 below. Such an environmental

impact statement shall consider only the effects described in

Subsection A(1), regardless of whether the project would result in

other kinds of environmental effects.

2. If the harmful effect is of the type described in Subsection

A(2), A(3) or A(4) above, an environmental study or an environmental

review shall be prepared in the manner specified in Section 6 below.

Section 5. Environmental Impact Statement

A. If a department within OPIC is required by Section 4(C)(1) to

cause the preparation of an environmental impact statement for a

particular project, it shall do so in accordance with Subsection B

below. If an environmental impact statement for the proposed

project, a project involving similar environmental issues or a

generic statement covering a host of similar projects already

exists, no new environmental impact statement shall be required.

When one or more other agencies are also involved in a particular

project requiring an environmental impact statement OPIC may rely

upon an environmental impact statement obtained by one or more of

the other agencies.

B. Environmental impact statements shall be concise and no

longer than necessary to permit an informed consideration of the

environmental effects of the proposed project and the reasonable

alternatives. The statement shall include a section on the

consideration of the purpose of and need for the proposed project; a

section that provides a succinct description of the environment of

the global commons affected by the proposed action; and a section

that analyzes, in comparative form, the environmental consequences

on the global commons of the proposed action and of reasonable

alternative means of structuring the project.

Section 6. Environmental Studies and Reviews

A. If a department is required under Section 4(C)(2) to produce

an environmental study or review, it shall, in consultation with the

Environmental Officer, determine whether an environmental study as

described in Subsection B below which deals with the environmental

aspects of the proposed project is available or will be undertaken

elsewhere. If no relevant environmental study is or will be

available, the OPIC department, in consultation with the

Environmental Officer, shall undertake the preparation of an

environmental review as described in Subsection C below with, as

appropriate, the assistance of the applicant and of other federal

agencies having jurisdiction by law or special expertise. If an

environmental review for the proposed project or a project involving

similar environmental issues or a generic review covering a class of

similar projects already exists, no new environmental review shall

be required hereunder. When one or more agencies are involved with

OPIC on a particular project, a lead agency may be designated to

prepare the environmental review.

B. An environmental study shall consist of a bilateral or

multilateral study by the United States and one or more foreign

nations or by an international body or organization in which the

United States is a member or participant.

C. An environmental review shall consist of a concise analysis

of important environmental issues relating to a proposed project,

including identification of such issues and of the significant

effects to the environment. The department involved in the

preparation of an environmental review shall consider the following

factors in deciding the scope, substance, and timing of review and

the availability of the review to other agencies:

1. The need to avoid infringement or the appearance of

infringement on the sovereign responsibilities and internal affairs

of another government;

2. The availability of meaningful information on the environment

of a foreign nation;

3. The need to protect confidential business information and

trade secrets of the applicant;

4. The desirability of acting promptly upon applications under

OPIC programs;

5. The desirability of the project in terms of its export

promotion and developmental effects;

[[Page 5650]]

6. OPIC's ability to influence the design and/or implementation

of the proposed project; and

7. The need to protect sensitive foreign affairs information and

information received from another government with the understanding

that it will be protected from disclosure.

Section 7. Decision

The required environmental documents developed in accordance

with these Procedures shall accompany the application through the

review process to enable officers responsible for approving an

application and, if necessary, the Board of Directors, to be

informed and to take account of the environmental considerations

covered by such documents.

Section 8. Availability

Subject to the consideration of Section 6(C), environmental

documents developed under these procedures shall be available to the

Department of State, Council on Environmental Quality and other

federal agencies and shall be included in the public information

files for the pertinent applications. Foreign governments affected

thereby may also be informed of such documents after coordinating

with the Department of State regarding such communication with the

foreign government.

Effective Date. These procedures become effective on September

4, 1979.

Dated: August 27, 1979, J. Bryce Llewellyn, President.

Appendix B--Recommended Content and Format for Environmental Impact

Assessment (Category A Projects)

I. Executive Summary

A. Concise project description

B. Identification of project sponsors, operators and contractors

C. Baseline environmental conditions

D. Applicable environmental standards

E. Proposed mitigation measures

F. Net environmental impacts

II. Policy, Legal and Administrative Framework

A. Applicable host country environmental and occupational safety

and health laws and regulations

B. Relevant international agreements

C. Requirements of potential investors, lenders and insurers

III. Baseline Conditions in Area Potentially Affected by Project

(``Project Area'')

A. Designation of project area perimeters

B. Physical geography (climate, geology, topography)

C. Natural events history (earthquakes, floods, fires, storms,

volcanic eruptions, etc.)

D. Biological environment

1. Proximity to national parks and other protected areas

2. Identification of unique or sensitive natural habitats of

internationally or locally recognized rare, threatened or endangered

species

3. Renewable and non-renewable natural resources

E. Human environment

1. Distribution of residential and occupational population in

project area

2. Description of previous, current and planned land use

activities in or near project area

3. Habitation or use of project area by indigenous peoples

F. Environmental quality of project area

1. Ambient air conditions (including seasonal variations)

(a) Sulfur dioxide

(b) Particulates

(c) Nitrogen oxides

(d) Carbon monoxides

(e) Airborne toxics

2. Water supply, quality and end use (human consumption,

agriculture, plant and animal habitat)

(a) Marine waters, including estuaries

(b) Surface waters (rivers, streams, lakes)

(c) Groundwater

3. Noise levels

4. Soil conditions, including contamination from previous or

current activities

G. Archeological, historical or cultural resources

IV. Potential (Unmitigated) Environmental, Health and Safety Impacts

A. Sources and volumes of untreated airborne, liquid, and solid

waste and potential impacts of unmitigated discharge on the

environment

B. Potential impacts on natural and biological resources

C. Potential human impacts:

1. Positive: Employment, services, economic opportunities

2. Negative: Resettlement and economic displacement

D. Potential occupational health and safety hazards

E. Potential for major safety and health hazards beyond the

workplace

V. Proposed Environmental Prevention and Mitigation Measures

(including a thorough discussion of alternatives and justifications

for measures selected)

A. Waste minimization measures

B. Waste treatment and disposal measures

C. Natural resource management (e.g. sustainable management of

biological resources and protection of endangered species and their

habitats)

D. Mitigation of human impacts: compensation, training, etc.

E. Occupational safety and health measures

F. Major hazard prevention and emergency response

VI. Projected Net Environmental Impacts (post-mitigation)

A. Physical impacts (e.g., topography, ground and surface water

supply, soil conservation)

B. Biological impacts (flora, fauna and related habitat with

particular attention to threatened and endangered species; natural

resources, e.g. primary forests, coral reefs, mangroves, etc.)

C. Net discharges of airborne, liquid and solid wastes and

resulting ambient impacts as compared to applicable host country,

World Bank and other relevant regulatory standards and guidelines

D. Net exposures by workers to safety and health hazards

E. Net potential for major hazards

F. Consistency with applicable international agreements

VII. Appendices

A. Permits issued and pending from environmental authorities

B. Author information

1. Names, affiliations and qualifications of project team

2. Relationship of authors to project sponsors

C. Record of meetings held as part of EIA, including public

hearings and consultations with government and non-governmental

organizations

D. Reference bibliography

E. Technical data not included in text

Appendix C--Recommended Content and Format for Environmental Management

and Monitoring Plan

I. Applicable Regulatory Standards and Guidelines

A. Host country laws and regulations

B. Sponsor, investor, lender and insurance requirements

C. International agreements

II. Environmental Management Measures

A. Potential impacts and corresponding preventive and mitigative

measures

B. Equipment specifications for preventive and mitigative

measures

C. Operational and maintenance procedures

III. Organizational Responsibilities and Management Issues

A. Operations

B. Supervision

C. Internal enforcement

D. Monitoring

E. Remedial actions

IV. Training Requirements

V. Monitoring and Reporting Procedures

A. Parameters to be monitored

1. airborne emissions and corresponding ambient air impacts

2. liquid effluents and corresponding ambient impacts on

receiving waters

3. Physical impacts

4. Natural resource and biological impacts

5. Human impacts

6. Workplace conditions

(a) Accident frequency and severity

(b) Worker exposures to hazardous substances

7. Impacts of dedicated offsite infrastructure and facilities

B. Frequency of monitoring

C. Monitoring techniques and procedures

1. Equipment and instrumentation

2. Quality assurance/quality control (QA/QC) procedures

3. Personnel and training requirements

D. Reporting procedures

1. Internal

2. External (e.g. to local authorities)

Appendix D--Recommended Content and Format For Environmental Audit

I. Executive Summary

A. Environmental, safety and health areas of concern

B. Recommended mitigation measures/enhancement opportunities:

priorities

C. Implementation schedule

II. Project Description

A. Location

[[Page 5651]]

B. Past operations history

C. Current operations

III. Applicable Regulations and Guidelines

IV. Audit Procedure (protocol)

A. Historical research

B. Records review

C. Interviews

D. Site inspections

E. Sampling and analysis (quality assurance and control)

procedures

V. Review of Environmental Management

A. Environmental management structure

B. Emergency, security and safety plans

C. Company-community interaction program

D. Handling of complaints and media coverage

VI. Environmental Impacts

A. Air emissions

B. Liquid effluents

C. Solid (non-hazardous) waste treatment

D. Hazardous materials and management

E. Noise and vibration

F. Groundwater and soil contamination

VII. Occupational Safety and Health

A. Summary of accident reporting, recording and investigation

B. Health and safety management

C. Site safety procedures

D. Medical monitoring program

E. Air quality

F. Noise level exposure

G. Chemical/material handling

H. Temperature exposure

I. Personal protective equipment

J. Emergency response capability

K. Fire protection

L. Training programs

VIII. Conclusions

IX. Mitigation Recommendations

A. Identify appropriate measures

B. Priorities

C. Implementation schedule

X. Environmental Enhancement Opportunities

A. Energy and energy conservation

B. Waste minimization

C. Cleaner technology initiatives

D. Training programs

XI. Annexes

A. Names of those responsible for preparing audit

B. Written material references used

C. Records of consultations

D. Other data

Audit checklists for specific industry sectors are available

from OPIC.

Appendix E-- Category A: Projects Requiring Environmental Impact

Assessment

I. Industrial Categories

A. Large-scale industrial plants

B. Industrial estates

C. Crude oil refineries

D. Large thermal power projects (200 megawatts or more)

E. Major installations for initial smelting of cast iron and

steel and production of non-ferrous metals

F. Chemicals

1. Manufacture and transportation of pesticides

2. Manufacture and transportation of hazardous or toxic

chemicals or other materials

G. All projects which pose potential serious occupational or

health risks

H. Transportation infrastructure

1. Roadways

2. Railroads

3. Airports (runway length of 2,100 meters or more)

4. Large port and harbor developments

5. Inland waterways and ports that permit passage of vessels of

over 1,350 tons

I. Major oil and gas developments

J. Oil and gas pipelines

K. Disposal of toxic or dangerous wastes

1. Incineration

2. Chemical treatment

L. Landfills

M. Large dams and reservoirs

N. Pulp and paper manufacturing

O. Mining

P. Offshore hydrocarbon production

Q. Major storage of petroleum, petrochemical and chemical

products

R. Forestry/large-scale logging

S. Large-scale wastewater treatment

T. Domestic solid waste processing facilities

U. Large-scale tourism development

V. Large-scale power transmission

W. Large-scale reclamation

X. Large-scale agriculture involving the intensification or

development of previously undisturbed land

Y. All projects with potentially major impacts on people or

serious socioeconomic concerns

II. Projects in, or Sufficiently Near Sensitive Locations of

National or Regional Importance, to Have Perceptible Environmental

Effects on:

A. National parks

B. Wetlands

C. Areas of archeological significance

D. Areas prone to erosion and/or desertification

E. Areas of importance to ethnic groups/indigenous peoples

F. Natural forests

G. Protected wildlands

H. Nationally designated refuges

I. Coral reefs

J. Mangrove swamps

K. Nationally designated seashore areas

L. Endangered species habitat

M. Properties on the World Heritage List

Appendix F--Index of World Bank and U.S. Export-Import Bank

Environmental, Health and Safety Guidelines

I. Guidelines: Impacts

A. Air quality (Exim, WB 94, WB pending)

1. Sulfur dioxide

(a) Ambient levels (WB 88)

(b) Emissions standards (WB 88)

(c) Sampling and analysis (WB 88)

(d) Sulfur oxides (WB 95)

2. Airborne particulates (WB 95)

(a) Dust emissions (WB 88)

(b) Electrostatic precipitators (WB 88)

3. Nitrogen oxides (WB 95)

(a) Emissions (WB 88)

(b) Sampling and analysis (WB 88)

4. Transboundary pollution (WB 91)

(a) Acid rain (WB pending)

5. Airshed modeling (WB pending)

6. Emissions monitoring (WB pending)

7. Elimination of ozone-depleting substances (WB 3/96)

B. Water use and quality (Exim)

1. Irrigation and drainage (WB 88*, 91)

2. Water supply (WB 91)

C. Wastewater treatment (WB pending)

1. Effluents, disposal of industrial wastes (WB 88)

2. Wastewater collection, treatment, reuse and disposal (WB 91)

(a) Reuse (WB 94)

3. Liquid effluents: land disposal and treatment (WB 88)

4. Sludge treatment (WB pending)

D. Solid waste collection and disposal

E. Management of hazardous and toxic materials and waste (Exim,

WB pending)

F. Occupational health

1. General guidelines (WB 88)

2. Safety (WB 88)

G. Sludge treatment (WB pending)

H. Site planning and management (WB 91, WB pending)

I. Hazardous materials management (WB 91)

1. In small and medium scale industries (WB 85)

2. Polychlorinated biphenyls (PCBs) (WB 94)

3. Asbestos

(a) Sampling and analysis of airborne asbestos (WB 88)

(a) Use in manufacturing industries (WB 88)

J. Natural hazards (Exim, WB 91)

1. Earthquake protection (WB 88, 93)

K. Major industrial hazards (WB 85, 91)

L. Socioeconomic and sociocultural effects (Exim)

1. Core issues (WB 91)

2. Induced development (WB 91)

3. Ecologically sensitive areas (WB 91)

4. Indigenous peoples (WB 91)

5. Cultural property (WB 91)

6. Cultural heritage in environmental assessment (WB 9/94)

M. Resettlement (WB 91, 94)

N. Wildland management (WB 91, 94)

O. Wetlands (WB 91)

P. Tropical forests (WB 91)

Q. Arid and semi-arid lands (WB 91)

R. Coastal zone management (WB 91)

S. Land and water resource management (WB 91)

T. Noise (Exim, WB 88)

U. International treaties and agreements (WB 91)

V. International waterways (WB 91)

W. Biological diversity (WB 91)

X. Secondary environmental effects (WB 88)

Y. Privatization (WB 4/94)

II. Guidelines: Industries

A. General industry and energy (Exim, WB 94)

1. Small and medium scale industries (WB 91)

B. Heavy machinery (WB pending)

C. Cleaner production (WB pending)

D. Rehabilitation of old plants (WB pending)

E. Aluminum (WB 88, 88, WB pending)

F. Iron and steel (Exim, WB 88, 91, 94, 95)

1. General considerations (WB 88)

2. Blast furnaces (WB 88)

3. Coke ovens (WB 88, 88)

4. Ore preparation, sintering and pelletizing (WB 88)

[[Page 5652]]

5. Rolling and finishing operations (WB 88)

6. Steel making process (WB 88, 88)

7. Foundries (WB pending)

(a) Iron and steel (WB 88)

(b) Non-ferrous (WB 88)

(c) Mini-steel mills (WB 95)

G. Mining and milling (Exim, WB 91)

1. Strip/surface: sediment and erosion control, land reclamation

(WB 88)

2. Open pit (WB 88, 94)

3. Underground (WB 88, 94)

4. Base metal and iron ore (WB 95)

5. Non-ferrous (WB 88, 91)

6. Coal mining (WB 88, 88, 95)

7. Asbestos mining and milling (WB 88)

H. Mineral processing

1. Copper and nickel (WB 88, 94, WB pending)

2. Lead and zinc (WB 88, 88 (lead))

3. Silver, tungsten, columbium and tantalum (WB 88)

4. Metal fabrication (WB pending)

5. Sulfuric acid plants (WB 88)

I. Oil and gas development (Exim, WB pending)

1. Onshore (WB 94)

2. Offshore (WB 88)

J. Pipelines: Oil and gas (WB 91)

1. Oil pipelines (WB 88)

2. Oil and gas pipelines onshore (WB 91)

3. Oil and gas pipelines offshore(WB 91)

K. Geothermal energy (WB 88, WB pending)

L. Hydroelectric projects (WB 91)

M. Power plants: General (Exim)

1. Thermoelectric projects: general (WB 88, 91)

2. Rehabilitation (WB pending)

3. Emissions: General (WB 94)

4. Thermal (WB 94, 95)

5. Gas turbine (Exim 94)

6. Engine driven (WB 94)

7. Small scale boilers (WB pending)

N. Electric power transmission and distribution (WB 91, 94)

O. Battery manufacturing (WB 88)

P. Forestry

1. Natural forest management (WB 91)

2. Logging (Exim, WB 94)

Q. Plantations/reforestation (WB 91, 94)

R. Palm oil industry (WB 88)

S. Sawmills (WB 88, 94)

T. Wood products industries (WB 94)

1. Plywood (WB 88, 88) and furniture (WB pending)

2. Wood preserving (WB pending)

U. Pulp and paper (Exim, WB 88, 88, 91, 94, WB pending)

V. Petroleum refineries (Exim, WB 88, 91, 94, 95)

W. Rubber (WB 88) and plastics (WB pending)

X. Chemicals and petrochemicals (WB 91)

1. Organic chemicals (WB pending)

2. Inorganic chemicals (WB pending)

3. Nitric acid plants (WB 88)

4. Petrochemical facilities (Exim, WB pending)

5. Polyvinyl chloride processing (WB 88)

Y. Ethanol production (WB 88)

Z. Printing (WB pending)

AA. Pharmaceuticals (WB pending)

BB. Cement (WB 88, 88, 91, 94, 95)

CC. Chlor-alkali (WB 88, 95)

DD. Coke manufacturing (WB 95)

EE. Fertilizer (WB 91, 94)

1. Fertilizer manufacturing wastes (WB 88)

2. Mixed fertilizer (WB 95)

3. Nitrogenous fertilizer (WB 95)

4. Phosphate fertilizer (WB 95)

FF. Pesticides

1. Pesticides manufacturing (WB 88, WB pending)

2. Pesticides formulation (WB pending)

3. Packaging and labeling (WB 88)

4. Transportation and distribution (WB 88)

5. Handling and application (WB 88, 88, 91, 94)

6. Rodenticides (WB 88, 88)

GG. Fishing and shipbuilding (WB 88, 91)

HH. Watershed development (WB 91)

II. Dams and reservoirs (WB 91)

JJ. Flood protection (WB 91)

KK. Agriculture

1. Production management (WB 91)

2. Integrated pest management (WB 91)

LL. Livestock and rangeland management (WB 91)

MM. Food and beverage processing (WB 91, 94)

1. Agroindustry (WB 91)

2. Dairy (WB 88, 88, 94, 95)

3. Fruit and vegetable processing (WB 88, 88, 95)

4. Vegetable oils (WB pending)

5. Tea and coffee (WB 88, WB pending)

(a) Coffee (WB 88)

(b) Tea (WB 88)

6. Breweries (WB pending)

7. Poultry processing (WB 88)

8. Fish processing (WB 88, 88, 94, WB pending)

9. Meat processing (WB 88, 88, 94, 95)

(a) Slaughterhouses: industrial waste disposal (WB 88)

(b) Slaughterhouses: design (WB 88)

(c) Slaughterhouses: occupational safety (WB 88)

10. Cane sugar (WB 88, WB pending)

(a) Agricultural operations (WB 88)

(b) Mill and refinery operations (WB 88)

11. Grain handling and storage (WB 88)

NN. Gas terminals (WB 94)

OO. Glass manufacturing (WB 88, WB pending)

1. Flat glass manufacturing (WB 94)

PP. Electronics (WB pending)

QQ. Instruments (WB pending)

RR. Plating and electroplating (WB 88, 88, 95)

SS. Dye manufacturing (WB pending)

TT. Coatings manufacturing (WB pending)

UU. Hospitals (WB 94)

VV. Tourism and hospitality (WB pending)

1. Hotels and resorts (WB 94)

WW. Rail transit systems (WB 94)

XX. Roads and highways (WB 91)

1. Rural roads (WB 91)

YY. Ports and harbor facilities (WB 91)

ZZ. Inland navigation (WB 91)

AAA. Large-scale housing projects (WB 91)

BBB. Telecommunications (WB 94)

CCC. Textiles (WB 88, 88, 94, 95)

1. Wool scouring (WB 88)

2. Cotton ginning (WB 88)

DDD. Tanning (WB 88, 88, 95)

References. (Appendix F)

WB 88--The World Bank, Environmental Guidelines, September 1988

WB 88--The World Bank, Occupational Health and Safety Guidelines,

September 1988

WB 91--The World Bank, Environmental Assessment Sourcebook, (3

volumes) 1991

WB 94--``World Bank Environment, Health and Safety Guidelines,''

Draft 1994

WB 95--The World Bank, Industrial Pollution Prevention and Abatement

Handbook, Preliminary Version (June 1995)

WB pending--World Bank guidelines under development

Exim--Export-Import Bank of the United States, ``Environmental

Procedures and Guidelines,'' April 2, 1996

Appendix G--Format for Host Government Notification Letter

[date]

Minister of State for Environment

Republic of------------------------------------------------------------

Dear Mr./Madam Minister: The Overseas Private Investment

Corporation (OPIC) is proposing to issue financing/insurance for an

investment in [name of host country] by a U.S. company. OPIC is an

agency of the United States Government, with the mandate of

facilitating economically productive and environmentally sound U.S.

private investments in developing countries and emerging economies.

OPIC is required by U.S. law to notify appropriate host

government authorities of investments under consideration for OPIC

assistance, which have the potential to pose significant

consequences for the environment. The project that is the subject of

this notification involves an investment by [name of applicant] in

the construction and operation of [concise description of project].

The potential environmental hazards associated with [industry

sector] includes [air, water, solid/hazardous waste, etc.].

Based on information provided to us by the investor, the project

does not appear to pose significant hazards to the environment,

public health, or safety resulting from the diverse impacts of

[industry sector].

OPIC is also required to provide your government with

information about standards and guidelines applicable to such

investments that have been developed by international organizations

or by federal environmental regulatory authorities of the United

States. The relevant World Bank and U.S. Environmental Protection

Agency guidelines are attached for your information.

We understand, of course, that the project will be subject to

the laws of [name of host country] with respect to the protection of

the environment as well as occupational health and safety.

If you have any questions about OPIC's environmental assessment

of this project, you may contact OPIC's Director of Environmental

Affairs at the above address or [phone/fax].

Sincerely yours,

[Name]-----------------------------------------------------------------

President and Chief Executive Officer

Enclosures

Appendix H--Glossary

Environmental Assessment (EA)--analytical tool used to

anticipate potential impacts of particular activities on the natural

[[Page 5653]]

environment and on humans dependent on that environment.

Environmental Audit (EAU)--assessment of environmental and

related human impacts of pre-existing or ongoing activities.

Environmental Impact Assessment (EIA)--comprehensive analytical

effort designed to anticipate environmental impacts of major

projects having the potential to have significant, diverse and

irreversible impacts on the natural environment and on humans

dependent on that environment.

Environmental Impact Statement (EIS)--comprehensive analytical

effort designed to anticipate environmental impacts of major federal

actions affecting the global commons outside of the jurisdiction of

any nation.

Environmental Management and Monitoring Plan (EMMP)--systematic

program designed to prevent, mitigate and monitor anticipated

environmental and related human impacts of prospective and ongoing

activities.

Environmental Remediation Plan (ENR)--systematic program

designed to reverse adverse environmental impacts of previous

activities at a site.

European Bank for Reconstruction and Development (EBRD)--

multilateral development bank established in 1990 to assist in the

economic, social and political development of Central and Eastern

Europe and the New Independent States of the former Soviet Union.

Other members include the European Community and the United States.

Export-Import Bank of the United States (Exim)--independent U.S.

government agency that helps finance the overseas sales of U.S.

goods and services.

Financial Intermediary (FI)--investment fund, bank, or other

financial institution that lends directly to projects or investment

funds guaranteed or insured by OPIC that invest in projects

(``subprojects'') subject to OPIC approval on policy grounds.

Foreign Assistance Act (FAA)--Foreign Assistance Act of the

United States International Finance Corporation (IFC)--affiliate of

the World Bank group that makes loans to and investments in private

sector projects in developing countries and emerging markets.

ISO 14000--basic elements of an effective environmental

management system as developed by the Technical Committee of the

International Standards Organization to provide organizations

worldwide with a common approach to environmental management.

Major Hazard Assessment (MHA)--analytical tool used for

identifying, analyzing and controlling potential major hazards to

human health and safety resulting from storage and processing of

toxic and hazardous substances.

World Bank (WB)--International Bank for Reconstruction and

Development.

Dated: March 31, 1997.

James Offutt,

Assistant General Counsel, Administrative Affairs.

[FR Doc. 97-2874 Filed 2-5-97; 8:45 am]

BILLING CODE 3210-01-P