The World Bank MA-Rural Water Supply (P145529) REPORT NO.: RES30190 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF MOROCCO RURAL WATER SUPPLY APPROVED ON APRIL 29, 2014 TO OFFICE NATIONAL DE L'ELECTRICITE ET DE L'EAU POTABLE (ONEE) WATER GLOBAL PRACTICE MIDDLE EAST AND NORTH AFRICA Regional Vice President: Hafez M. H. Ghanem Country Director: Marie Francoise Marie-Nelly Senior Global Practice Director: Guang Zhe Chen Practice Manager/Manager: Carmen Nonay Task Team Leader: Mouhamed Fadel Ndaw The World Bank MA-Rural Water Supply (P145529) ABBREVIATIONS AND ACRONYMS BIRD II Regional Potable Water Supply Systems Project BIRD IV Rural Water Supply Project EIA Environmental Impact Assessment ESMP Environment and Social Management Plan ISDS Integrated Safeguards Data Sheet ONEE Office National de l’Electricité et de l’Eau Potable OP Operational Policy PAD Project Appraisal Document The World Bank MA-Rural Water Supply (P145529) Note to Task Teams: The following sections are system generated and can only be edited online in the Portal. BASIC DATA Product Information Project ID Financing Instrument P145529 Investment Project Financing Original EA Category Current EA Category Partial Assessment (B) Partial Assessment (B) Approval Date Current Closing Date 29-Apr-2014 30-Sep-2021 Organizations Borrower Responsible Agency Office National de l'Electricite et de l'Eau Potable (ONEE) Office National de l'Electricité et de l'Eau Potable (ONEE) Project Development Objective (PDO) Original PDO The project development objective (PDO) is to provide access to safe and reliable drinking water supply for rural communities in targeted underserved areas in the Project area. OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IBRD-83970 29-Apr-2014 27-May-2014 18-Dec-2014 30-Sep-2021 158.62 54.30 94.06 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No The World Bank MA-Rural Water Supply (P145529) Note to Task Teams: End of system generated content, document is editable from here. I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING A. Project Status 1. As of April 2018, Morocco Rural Water Supply project (BIRD IV) is rated Moderately Satisfactory (MS) for both progress towards PDO achievement and overall implementation progress. More than 365,000 people (35% of the final 2021 target) in 440 villages have benefited from the project. Commitments rate has progressed from 46% to 58% over the last 12 months and is expected to reach 71% by end of September 2018. Disbursements have followed with an increase from 20% in July 2017 to 37% currently (June 2018). Based on the implementing agency’s (Office National de l’Electricité et de l’Eau Potable, (ONEE)) recent experience in the effective management of land acquisition and its mastering of related tools and procedures, the completion of most land acquisition is foreseen in 2018, opening the way for a major increase of commitments and subsequently of disbursements, from the related Regional Potable Water Supply Systems Project (BIRD II, closed in 2016) and the ongoing Rural Water Supply Project (BIRD IV) . Therefore, although BIRD IV contracts are still at an early stage and their physical implementation and disbursement have not yet materialized, they are on track for full completion by the closing date of September 30, 2021. 2. The completion of all project activities and achievement of the PDO are expected by closing date of September 30, 2021. B. Rationale for restructuring 3. In May 2015, the Bank carried out a review of project compliance with Operational Policy (OP) 4.37 on Safety of Dams and on the conformity of dam management in Morocco. Fifteen dams were identified as potentially affecting World Bank-funded infrastructure integrity or capacity to operate properly in case of dam failure or malfunction. The review concluded that the procedures and guidelines set forth to monitor and manage dam safety in Morocco are consistent with international good practices as recommended by the International Commission on Large Dams, and therefore consistent with the requirements set forth by OP4.37. The review also acknowledged that the Moroccan government has established a satisfactory framework for institutional security for dams under the supervision of the Ministry of Energy, Mines, Water and Environment, Watershed Agencies and ONEE-Water Branch. 4. Based on the information provided in the Government note on the national regulatory framework for dam safety and the results of the examination of the individual safety inspection sheets of the fifteen dams relating to the rural water supply projects financed by the Bank in Morocco, the Bank review confirmed the following: i. an effective dam safety program is already operational; ii. comprehensive inspections and an assessment of the safety of existing dams have already been conducted and documented, in a manner satisfactory to the Bank. 5. While the World Bank does not finance construction or rehabilitation of dams under the BIRD IV, the success of the project is contingent on the storage and operation of the two out of the abovementioned fifteen dams for their supply of water. Specifically, the Tiznit treatment plant depends on the availability of water and the good The World Bank MA-Rural Water Supply (P145529) functioning of the Youssef Ben Tachfine dam. Since June 2016, when the BIRD II project closed, the Safi Water Treatment Plant has been transferred to the BIRD IV project. This plant is fed from the Massira dam whose waters are derived by the Imfout dam. As mentioned above, national legislation for monitoring and management of dams has been reviewed and found fully in line with the requirements of the policy. The safety inspection and assessment reports for a sample of the dams have been reviewed and compliance with the World Bank requirements has been verified. Specifically, according to the assessment of the Massira dam, the state of civil works is satisfactory and no major intervention and heavy repairs are to be undertaken. Youssef Ben Tachfine dam’s performance is also satisfactory with no evidence of anomaly. In addition, Morocco’s private sector engineering industry has high quality expertise in advanced dam design and construction techniques, in line with international standards. No dam failure was reported in Morocco since 1956. 6. Given that some of the BIRD IV activities depend on the existing dams for their supply of water, the OP 4.37 policy on dam safety needs to be triggered, and respective safeguard documents have been updated as described in more detail below. II. DESCRIPTION OF PROPOSED CHANGES 7. Based on the reasons described above, the restructuring will encompass the following changes: i. OP 4.37 on Safety of Dams needs to be triggered because project activities are dependent on the existing dams, and the environmental analysis has been updated accordingly. The restructuring paper summarizes safeguards performance and identifies the aspects of the Environmental Impact Assessment (EIA) that needed to be updated. ii. The EIA has been updated by the client per the new policy triggered. The EIA provides a summary of the Moroccan legislation and requirements regarding the dam safety monitoring system. No further action appears necessary with regards to updating the Environment and Social Management Plan (ESMP) to reflect dam safety requirements. iii. The client disclosed the revised EIA on its website on March 26, 2018. iv. The Integrated Safeguards Data Sheet (ISDS) has also been updated and disclosed to reflect the changes in safeguards policies. 8. It must be noted that triggering of OP 4.37 policy does not change the scope or nature of project activities, implementation arrangements or require other amendment. It also does not change the project safeguard category, which is currently classified and will remain as category B. Note to Task Teams: The following sections are system generated and can only be edited online in the Portal. III. SUMMARY OF CHANGES Changed Not Changed Change in Safeguard Policies Triggered ✔ The World Bank MA-Rural Water Supply (P145529) Change in Environmental Analysis ✔ Change in Implementing Agency ✔ Change in DDO Status ✔ Change in Project's Development Objectives ✔ Change in Results Framework ✔ Change in Components and Cost ✔ Change in Loan Closing Date(s) ✔ Cancellations Proposed ✔ Reallocation between Disbursement Categories ✔ Change in Disbursements Arrangements ✔ Change in Disbursement Estimates ✔ Change in Overall Risk Rating ✔ Change of EA category ✔ Change in Legal Covenants ✔ Change in Institutional Arrangements ✔ Change in Financial Management ✔ Change in Procurement ✔ Change in Implementation Schedule ✔ Other Change(s) ✔ Change in Economic and Financial Analysis ✔ Change in Technical Analysis ✔ Change in Social Analysis ✔ IV. DETAILED CHANGE(S) OPS_DETAILEDCHANGES_COMPLIANCE_TABLE COMPLIANCE Safeguard Policies Safeguard Policies Triggered Current Proposed The World Bank MA-Rural Water Supply (P145529) Environmental Assessment (OP) (BP 4.01) Yes Yes Performance Standards for Private Sector No No Activities OP/BP 4.03 Natural Habitats (OP) (BP 4.04) No No Forests (OP) (BP 4.36) No No Pest Management (OP 4.09) No No Physical Cultural Resources (OP) (BP 4.11) No No Indigenous Peoples (OP) (BP 4.10) No No Involuntary Resettlement (OP) (BP 4.12) Yes Yes Safety of Dams (OP) (BP 4.37) No Yes Projects on International Waterways (OP) (BP No No 7.50) Projects in Disputed Areas (OP) (BP 7.60) No No Note to Task Teams: End of system generated content, document is editable from here.