Forestal Trillium Summary Of Project Information (SPI)       Project Name:    Venezuela: Forestal Trillium de Venezuela      Region:Latin America and Caribbean   Sector:   Project No:009463   Projected Board Date:May 21, 1999   Company Name:Forestal Trillium de Venezuela, C.A.    Technical Partner and/or Major Shareholders     	The major sponsor and shareholder is Trillium Corporation, based in Bellingham, Washington, U.S.A.  Associated with Trillium on the project is Harry Merlo, (Chairman and CEO of Louisiana Pacific, 1974-1995) who pioneered the commercial development of engineered wood products, including OSB, for Louisiana Pacific in the 1970s.  Also involved in the project is James Eisses, who served as Executive Vice President and Director of Engineered Products during his tenure with Louisiana Pacific from 1974-1995.  Messrs. Merlo and Eisses will be providing important marketing and technical production expertise, respectively.     Project Cost Including Proposed IFC Investment     	The project cost is estimated at US$91 million, and IFC''s proposed investment will amount to US$61 million, including a US$17 million A Loan for IFC''s own account; a US$38 million B Loan for the account of participants, and an equity investment of up to US$6 million, also for IFC''s own account.     Location of Project and Description of Site     	The Forestal Trillium plant will be located in the industrial area of Ciudad Guayana, Venezuela, about 20 km west of the port of Palua on the Orinoco River.  The project will be integrated with the operations of an existing sawmill, Corporation Forestal Uverito (CFU)and will benefit from existing infrastructure (roads, electric power, etc.) on the project site.     Description of Company and Purpose of Project    (include IFCs Role and Development Impact)    	Forestal Trillium will be an integrated forestry products project involving the design, construction and operation of a plant to produce oriented strand board (OSB) and dry-process hardboard ("Hardboard") from a Government sponsored, Caribbean Pine plantation in Puerto Ordaz, Venezuela.    	Forestal Trillium will use fiber from this plantation, in the form of pulp logs and residual output from the existing CFU saw mill to create value-added products for export.  Construction will take an estimated 21 months.    The Trillium Corporation sponsors seek long-term and competitively priced financing for their project, which is not available in Venezuela. While Forestal Trillium will benefit significantly from the existing CFU sawmill and infrastructure forming part of the venture, this project should be regarded more as a greenfield, project finance operation, with its implementation period of 21 months.  As such, the project requires appropriate grace periods and tenors to ensure proper capitalization.    Given that this is Trillium Corporations first operation in Venezuela, a country with a difficult political and economic environment, it is looking to IFCs experience in structuring bankable project finance transactions in Venezuela.  Beyond IFCs general sector knowledge, Trilliums Management also values IFCs specific acquaintance with the Caribbean Pine plantation related to the project. In 1995, IFCs Technical Department appraised the plantation in connection with a mandate to advise the Venezuelan Government on the privatization of CVG-PROFORCA.  While such privatization never materialized, IFC gained valuable information on the plantation at that time which it can now share with the project sponsors and potential investors.    The development impact of the Trillium Forestal project is positive.  Most importantly, the Venezuelan Government (CVG) is eager for Trilliums project to materialize given that its Caribbean Pine plantation is mature, overgrown and in great need of harvesting.  Trees are beginning to decay and are entering a use it or lose it phase.  The Trillium Forestal project will thus help CVG start to generate returns on its investment of the last 30 years. Trillium Corporation can also bring important advantages to CVG and the Venezuelan forestry industry by offering technical advice based on its extensive experience with sustainable forestry management and the superior leadership to be provided by its project team.  Finally, this project will allow IFC to play an important catalytical role in bringing long-term financing into Venezuela.       Environmental Category and Issues     	This is a category B project according to IFCs environmental review procedure because specific impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. The following potential environmental, social, health and safety impacts were analyzed:  plantation management (including pest control) and sustainable harvesting issues, site acquisition, air emissions from processing facility, water use and waste water management, solid waste management and disposal, adequacy of transport and infrastructure to export, fire protection and emergency response, and occupational health and safety.    The plantations, from which the sponsor will obtain raw wood, cover an area of approximately 800,000ha - of which 450,000ha have been planted with Caribbean Pine over a period of 30 years.    The management of the plantation provides for appropriate environmental protection through retention of areas of natural vegetation, and controls on the use of agrochemicals and erosion.    The construction of the mill sites will not result in damage to ecologically sensitive habitats and has not required resettlement or economic displacement.  The sponsor will also develop a docking facility on the Orinoco River.  The final location of this site has yet to be agreed but the sponsor has confirmed that any development will be in accordance with World Bank Group (WBG) requirements.     Air emissions from processing activities will be in compliance with World Bank Group requirements. The only wastewater that will be generated from processing is clean up water (which will be re-used in the manufacturing process) and septic waters from bathroom facilities which will be discharged to a septic tank. Solid waste will comprise bark/process fines which cannot be used for product and which will be burnt in an incinerator (with ash disposal as soil conditioner).  Other waste arisings are small and include scrap metal and office materials which will be disposed of in a municipal landfill.    The mill buildings will be sprinklered throughout, and the mills will be operated in accordance with a health and safety plan with standards equal to or exceeding those recommended by the American Panel Board Association model guidelines.    The  is  April 21, 1999 from the Public Information Center.       Host country location of environmental documents    Venezuela      Date SPI sent to InfoShop April 20th 1999   This Summary of Project Information is prepared and distributed to the public in advance of consideration of the proposed transaction by the Corporations Board of Directors.  It is provided for the purpose of enhancing the transparency of IFCs activities and should not be construed as presuming the outcome of IFC Board consideration.    For Additional Information contact:  Corporate Relations Unit -   telephone: (202) 473-7711   facsimile: (202) 974-4384  Environmental documents for this project are available at http://www.ifc.org and from the World Bank InfoShop (http://www.worldbank.org/html/pic/aboutinfo.html).