Big investments aim to cleanse pollution problems

Newsroom 19/09/2007 | 15:49

At the beginning of this year, a report by the Environment and Water Protection Ministry (MMGA) listed the major companies which are not likely to fulfill their environmental protection commitments, due to the high sums it would cost.
Since then, the media has intensely covered the severe pollution found at Mittal Steel plants in Galati back in March and the closing-down of Petrom's Arpechim division for failing to meet ecological criteria in May. The companies fought back, appealed the courts' decisions when such rulings existed and announced big investment plans worth tens or hundreds of million euros.
Petrom's Arpechim must conclude them by 2012. The company plans to put about EUR 60 million into Arpechim's environmental-friendliness by 2011.
Mittal Steel must be fully compliant with EU environment laws by 2014 and invest a total of EUR 250 million. This year it has announced investments totaling EUR 36.3 million in thirteen environmental projects.
Rompetrol Rafinare Constanta's deadline is 2012. Two years after that time limit, the company will have put EUR 163.2 million into environmental investments, according to its statements this year.
The three companies' total commitments amount to roughly EUR 470 million by 2014, but for now they are at a declarative stage.
“The Authority for the Protection of the Environment (APM) will take measure against the companies we have named if they do not stick to the deadlines in the APM Action Plan,” said ministry reps.
The aforesaid companies are merely the tip of the iceberg. At present, there are 660 installations in Romania that should comply with the European Integrated Pollution Prevention and Control Directive. Only 146 do, according to MMGA reps. The remaining 514 are either in the process of getting their integrated authorizations – 99 of them – or have these authorizations but need to make some serious investments, which is the case for 411 IPPC installations.

Oil&gas companies invest big in cleaning up image
Oil and gas market leaders Petrom and Rompetrol are two of the biggest local companies, but both have made their way up on biggest polluters lists as well.
Following warnings, fines and even the closing down of one refinery in May this year, the two companies have announced investments totaling more than EUR 220 million in modernizing and environmental programs for the years to come.
A big chunk of the investments was prompted by the administration's decision to close down Petrom's Arpechim Ploiesti division in spring. Petrom appealed the decision and the refinery was re-opened, but the GPM has filed its own appeal and a final decision is yet to be reached.
Regardless of the ruling, Arpechim must put serious money into modernizing its production facilities this year and the next five to come, but so far it seems to have employed the baby-steps strategy.
“Total investments planned for this year amount to EUR 20.5 million. By April, the company had invested EUR 1.8 million,” said Octavian Popescu, director of the National Environment Guard (GNM).
The sum invested in the first quarter of the year represents 8.8 percent of Arpechim's total annual commitments.
Still, the company announced bold plans this year of getting the refinery in line with environment standards. By 2011, Petrom plans to put about EUR 60 million into Arpechim's environmental-friendliness, while a total of EUR 200 million will be allotted to modernizing and renewing the refinery's equipment. The refinery's poor ecological track record goes farther than this year's closure. Aside from the EUR 73,300 fine it had to pay on this occasion, in 2006 Arpechim was also fined EUR 128,000 for failing to meet ecological requirements.
Rompetrol, too, has had its own problems with the environmental protection authorities, causing it to close down almost a quarter of its gas storage capacities.
At present, Rompetrol Rafinare has 26 gas tanks that abide by environmental-protection rules, according to Popescu of GNM. The remaining four tanks have been given new roles and are used to stock gasoline or other intermediary products. Since 2006, the company has spent $4.6 million on repairing its gas tanks.
Rompetrol representatives say the company has put almost $225 million into environment and techonological investments since Petromidia was privatized in 2001, $40 million of which was in the form of direct investments in environment protection.
At a group level, the company has invested $20 million in the environment and technology.
Rompetrol Industrial Park Navodari, a company that is part of the Rompetrol Group, will also put in efforts to build up the company's image among environmentalists. The company plans to become a partner in the Ecoparks program initiated by the Catholic University in Leuven. The program consists of devising an environmental-protection program that will save resources, energy and money. An intent letter has been sent for this, and a decision is pending in a few months.

Mittal Steel must cleanse dusty skies
Galati County has long been floating on clouds of dust and fumes coming from Mittal Steel furnaces, as investments in modern technology seemed to have been put off indefinitely by the company's management.
In the 2004-2006 period, the company should have invested almost EUR 108 million in equipment meant to reduce pollution. At the end of last year, Mittal Steel had only invested EUR 20.6 million, representing only 18 percent of its commitments, according to the GNM.
The plant continues to function mostly because it employs about 15,000 locals, but has to invest in excess of EUR 250 million in modern technology by 2014 if it plans to go on functioning, according to the MMGA.
The company seems to be doing just that, as this year Mittal Steel announced it would invest EUR 36.3 million in thirteen environmental projects.
“So far in Romania, out of the EUR 327.5 million we have invested, we spent almost EUR 56 million financing environmental projects. Last year alone we invested EUR 25.4 million in environmental protection. We have made a commitment that we would complete the euro-compliant program six months ahead of the deadline stipulated by the European Union,” Augustine Kochuparampil, CEO of Mittal Steel Galati, told Business Review.

Rosia Montana: a thorny matter
Rosia Montana is perhaps the first name that comes to mind when talking about environmental issues in Romania. The mining project has caused controversy ever since the media caught wind of it in the late 1990s. It was deemed harmful by the Romanian Academy who said that the method used for separating gold from cyanide was against EU environmental regulations. The Romanian Orthodox Church and the Romanian Catholic Church have both opposed the project, local and Western NGOs such as Greenpeace and the European Federation of Green Parties did the same and the World Bank Group's International Finance Corporation in 2002 decided not to finance the project. To this day, the pro-Rosia groups and the project's detractors continue to spend big on campaigns convincing people of the righteousness of their cause.
The latest major development occurred in February, when the law banning the use of cyanides in gold mines was open for debate in Parliament. The senate rejected it, and the Deputies Chamber discussed it in May. MPs will vote on it in the fall session, but the verdict will be tough to enforce since environment minister Attila Korodi asked for a five-year transition period for companies already using cyanide technology. Gabriel Rosia Montana, the company standing at the core
of the controversy, hopes it will win out.
“We expect to start construction by the end of the year and have the first pour of gold in 2009. Estimated life of the mine is at least 20 years (two years construction, 16 years production and two years reclamation),” said Cristina Merill, communication and corporate social responsibility coordinator for Gabriel Rosia Montana.
She put the company's case. “The area is suffering from 2,000 years of under-funded and inefficient mining practices, it is an area where the rivers literally run red with heavy metals and which the Romanian government has deemed a “Disadvantaged Zone.” Our project's modern mining methods will actually remediate historic pollution, leaving Rosia's waters
cleaner than we found them,” said Merill.
Moreover, throughout the life of the mine, the Rosia Montana project will inject more than EUR 1.8 billion into Romania's economy (of which EUR 326.7 million will be spent on initial construction and support), say officials.
“Already, Gabriel Resources, through Rosia Montana Gold Corporation, has invested more than EUR 145.1 million in Romania across several areas (financial, patrimony, social and the environment) and is employing more than 650 people,” said Merill.

Ana-Maria David

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