The World Bank Report No: ISR15190 Implementation Status & Results Tunisia TN-Tunis West Sewerage (P099811) Public Disclosure Copy Operation Name: TN-Tunis West Sewerage (P099811) Project Stage: Implementation Seq.No: 14 Status: ARCHIVED Archive Date: 16-Jun-2014 Country: Tunisia Approval FY: 2007 Product Line: IBRD/IDA Region: MIDDLE EAST AND NORTH AFRICA Lending Instrument: Specific Investment Loan Implementing Agency(ies): Key Dates Board Approval Date 06-Jul-2006 Original Closing Date 31-Dec-2011 Planned Mid Term Review Date 10-Jan-2011 Last Archived ISR Date 01-Jan-2014 Effectiveness Date 17-Nov-2006 Revised Closing Date 30-Jun-2015 Actual Mid Term Review Date 21-Apr-2011 Project Development Objectives Project Development Objective (from Project Appraisal Document) The project will help achieve the following objectives: (i) Improve the quality of sanitation services in Greater Tunis, and preserve the achievements of the sector; (ii) Promote the reuse of treated wastewater in irrigation on a sustainable basis and in significant quantities, which is very important given the severity of water scarcity in Tunisia, and (iii) Enhance ONAS performance through financial and operational management capacity building. Has the Project Development Objective been changed since Board Approval of the Project? Yes No Component(s) Component Name Component Cost Tunis West Sewage Treatment Plant 37.40 Raw Sewage Transfer 8.40 Treated Sewage Transfer 13.13 Pumping Station 9.58 On-Site Sludge Disposal Facility 0.50 Public Disclosure Copy Construction Supervision 1.14 Institution-Building 1.75 Overall Ratings Previous Rating Current Rating Progress towards achievement of PDO Moderately Satisfactory Moderately Unsatisfactory Overall Implementation Progress (IP) Moderately Unsatisfactory Moderately Unsatisfactory Overall Risk Rating Moderate Moderate Page 1 of 4 The World Bank Report No: ISR15190 Implementation Status Overview Overall progress. As of May 2014, overall disbursement stands at 78% of project costs, and commitments 98%. After fast pace implementation in 2010-2011, as of March 2012 implementation of the largest component, namely construction works at the WWTP at El Attar, slowed down due to a conflict between ONAS and the consortium led by EMIT which was brought for international arbitration at the International Chamber of Commerce (ICC). The construction work at the El Attar has been stopped for more than 2 years. The ruling Public Disclosure Copy was initially expected in early 2013, but was postponed several times by ICC, and was finally received in November 2013. ONAS has communicated to the Bank the ICC ruling dated November 22, 2013, which states that: (i) the cancellation by ONAS of the consortium’s contract for non-compliance was declared void, requesting that ONAS refund the various guarantees that were called, (ii) the ongoing construction contract should remain but should be solely between ONAS and EMIT, as the sole responsible party for finishing the works, following the disappearance and subsequent bankruptcy of its local Tunisian construction partner GTM; and (ii) EMIT is given a total of 26 months to finalize the works (from the date of the ruling i.e. November 2013), while the original construction contract was for a total of 24 months. While the ICC ruling set the stage for the construction to resume without the need to launch a new tender and recruit a new contractor (this would have been difficult, given the situation of the site after a two-year interruption), it gives considerable time for EMIT to recruit a sub-contractor for civil engineering works, leaving major uncertainties as to the actual timetable for completing the WWTP. EMIT and ONAS may also need to agree on possible contract adjustments in order to finalize the interrupted works. ONAS instructed the Bank that it had made all payments requested under the ICC ruling, and that a first meeting between ONAS and EMIT was scheduled by the end of May 2014. While ONAS has inquired about the possibility of an additional loan to finalize the works at el Attar (which could also include the construction of a sludge drying facility at the El Attar site to treat the sludge produced by all Greater Tunis WWTPs, for an estimated budget of TDN 20 million), the Bank indicated that this could only be discussed once a credible plan for completing the El Attar WWTP would have been agreed between ONAS and EMIT. The overall rating of the project for “Progress toward achievement of PDO” was downgraded to Moderately Unsatisfactory, to reflect the uncertainties raising in the aftermath of the ICC ruling for the completion timetable of the El Attar WWTP Tariff increase and financial situation. ONAS was granted a 7% tariff increase in mid-January 2014 following the tariff increase granted for SONEDE. A financial situation analysis of ONAS, including financial ratios was completed in February 2014 (under the MTR for the North Tunis sanitation project). The analysis includes analysis of financial statements for fiscal years 2008 to 2012 and updated financial projections based on recent evolutions since 2010, namely the 7% annual tariff increase that was adopted until 2016. This increase has only partially slowed down the deterioration of its financial balance prior to government subsides, which have reached DT 79 million (US$48 million) in 2012. As of February 2012, the financial situation of ONAS is stable (based on revenues and government subsidies) and allows it to finance all O&M costs. Locations Country First Administrative Division Location Planned Actual Tunisia Not Entered Sejoumi Tunisia Not Entered Attar Tunisia Not Entered Oued Miliane Public Disclosure Copy Tunisia Not Entered Sidi Hassine Results Project Development Objective Indicators Page 2 of 4 The World Bank Report No: ISR15190 Indicator Name Core Unit of Measure Baseline Current End Target Volume of treated sewage effluents made Text Value 0 35% of treated wastewater available for water reuse in El-Attar irrigation Date 31-Dec-2005 31-Dec-2013 30-Jun-2014 Public Disclosure Copy areas. Comments El Attar WWTP not yet Closing date was extended completed and operational Ratio of staff per 1,000 connections. Text Value 4 2.9 Date 31-Dec-2005 31-Dec-2012 30-Jun-2015 Comments Value for 2012 already Value for 2013 expected to be complied with end targets. 3, close to end target Working Ratio Text Value 84% 76.4% Date 31-Dec-2006 31-Dec-2012 31-Dec-2010 Comments Volume of sewage collected in Greater Tunis Cubic Meter(m3) Value 86.80 109.70 113.70 Sub Type Supplemental Volume of sewage collected in Greater Tunis Text Value 86.8 Mm3 100.6 Mm3 Date 31-Dec-2005 31-Dec-2012 30-Jun-2015 Comments expected value for 2012 is target to be far exceeded 110 m m3 Intermediate Results Indicators Indicator Name Core Unit of Measure Baseline Current End Target Percentage of works completed for El-Attar Text Value 0 100% plants. Date 31-Dec-2005 31-Dec-2013 30-Jun-2015 Comments Uncertainties arising following the ICC ruling for the completion timetable of the El Attar WWTP Public Disclosure Copy Data on Financial Performance (as of 13-Mar-2014) Financial Agreement(s) Key Dates Project Ln/Cr/Tf Status Approval Date Signing Date Effectiveness Date Original Closing Date Revised Closing Date P099811 IBRD-73970 Effective 06-Jul-2006 18-Jul-2006 17-Nov-2006 31-Dec-2011 30-Jun-2015 Disbursements (in Millions) Project Ln/Cr/Tf Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed Page 3 of 4 The World Bank Report No: ISR15190 P099811 IBRD-73970 Effective USD 66.80 66.80 0.00 59.12 12.96 88.00 Disbursement Graph Public Disclosure Copy Key Decisions Regarding Implementation Official business only Restructuring History Level two Approved on 22-Dec-2011, Level 2 RVP Decision on 21-Dec-2012 Related Projects There are no related projects. Public Disclosure Copy Page 4 of 4