World Bank building

MIGA’s goal is to promote foreign direct investment into developing countries to support economic growth and more.

Young woman bending down to tending to her outside chores

Explore different types of political risk insurance guarantees provided to investors and lenders.

Hyundai building

Explore global projects that support economic growth, reduce poverty and improves people’s lives.

Hands husking peas into a basket full of peas

Learn about the progress MIGA is making in its mission to support economic growth, reduce poverty and improve people’s lives.

Stay Connected
x
Jordan

Queen Alia International Airport

$195.15 million
Infrastructure
ESRS
Active
airport

Project Facts

Project Facts

Project Facts

jordan
Guarantee Holder
Meridiam Eastern Europe Investments 2 SAS
Investor Country
France
Environmental Category
B
Date SPG Disclosed
January 18, 2018
Projected Board Date
February 28, 2018
Project Type
Non-SIP

This Environmental and Social Review Summary (ESRS) is prepared by MIGA staff and disclosed prior to the date on which MIGA’s Board of Directors considers the proposed issuance of a Contract of Guarantee. Its purpose is to enhance the transparency of MIGA’s activities. This document should not be construed as presuming the outcome of the decision by MIGA’s Board of Directors. Board dates are estimates only. 

Any documentation that is attached to this ESRS has been prepared by the project sponsor, and authorization has been given for public release. MIGA has reviewed the attached documentation as provided by the applicant, and considers it of adequate quality to be released to the public, but does not endorse the content.

In November 2007, AIG entered a 25-year concession agreement (the Concession) with the Government of Jordan (GoJ) for the expansion, rehabilitation, and operation of the Queen Alia International Airport (QAIA), originally built in 1983. Pursuant to the Concession, AIG is entrusted with the design, development, operation, administration, management, improvement and maintenance of QAIA until 2032.

The concession required that a new terminal be built and commissioned to replace the existing one (Phase 1, completed in 2013), followed by the expansion of related airport facilities (Phase 2, completed in 2016), the overall goal being to increase the airport’s capacity to handle long-term traffic growth and establish it as a modern and efficient transportation asset supporting Jordan’s regional and global connectivity.

The Project benefited from the International Finance Corporation’s (IFC) advisory services (during the structuring and concession bidding stage) and lending services (during the financing stage) and is considered the first successful airport public-private partnership project in Jordan and the Middle East and the largest private sector investment in Jordan to date.

The current Project refers to the potential acquisition of a direct or indirect stake in the share capital of AIG in the context of a sell-off considered by all or part of AIG’s existing shareholders. MIGA was approached by certain of the new interested investors to cover their equity and/or quasi-equity investment into AIG against the risks of Breach of Contract, Expropriation, Transfer restriction & Inconvertibility, and War & Civil Disturbance.

Construction is not applicable to this project as construction was largely completed in 2016.

Overview of MIGA’s Scope of Review

MIGA’s environmental and social due diligence relied on the International Finance Corporation (IFC’s) continued supervision of the environmental and social performance of the project against the mitigation measures identified in IFC’s Environmental and Social Review Summary (ESRS) from 2014, as well as reviews of reports submitted by the Client. A supervision visit by IFC to the site was undertaken in October 2017 to review environmental and social policies, management systems, related procedures, including Occupational Health and Safety (OHS). The current environmental and social performance of the project is satisfactory as per IFC’s requirements and applicable Performance Standards (PSs).

MIGA conducted a due diligence visit in November 2017. During MIGA’s visit, the project scope was discussed with various stakeholders such as the Arab Bank, Royal Jordanian Airlines, Central Bank of Jordan, Ministry of Transport and Project Management Unit, Ministry of Finance, Jordan Investment Commission, Airport International Group (AIG), Civil Aviation Regulatory Commission, EBRD, and IFC Country Office.

B.  Environmental and Social Categorization

The project is a category B under MIGA’s Policy on Environmental and Social Sustainability (2013), as the environmental and social impacts of the project are limited, site-specific and can be minimized, avoided or mitigated by adhering to generally recognized performance standards, guidelines, or design criteria. Key environmental and social issues associated with this project include: i) environmental and occupational health and safety management systems and procedures during operations; ii) regulatory compliance with applicable environmental and social national laws and regulations and recognized international standards as requested by the QAIA Rehabilitation, Expansion and Operation Agreement (REOA); iii) implementation of appropriate HR policies and procedures; iv) Occupational Health and Safety (OHS) risks for employees; v) wastewater treatment and disposal; vi) life and fire safety; vii) emergency response and preparedness; viii) fuel/hazardous materials storage and handling; ix) aircraft noise mitigation and x) bird hazards.

While all Performance Standards (PSs) are applicable to this project, our current information indicates that the project will have impacts which must be managed in a manner consistent with the following Performance Standards (MIGA will periodically review the project's ongoing compliance with the Performance Standards):

  • PS1:  Assessment and Management of Environmental and Social Risks and Impacts
  • PS2:  Labor and Working Conditions
  • PS3:  Resource Efficiency and Pollution Prevention
  • PS4:  Community Health, Safety and Security

The airport is in a relatively remote area and the project is limited to the optimization of activities at the existing, operating airport, and there is no land acquisition and involuntary resettlement. There are no threats to biodiversity, including habitat destruction, given the airport’s desert environment. There are no indigenous peoples affected by the airport development. There is no construction, therefore no issues have been identified in relation with PS5, PS6, PS7 or PS8.

Although PS6 is not triggered, AIG has addressed wildlife strikes risks.

A Wildlife Hazard Management Plan (WWHP) has been developed in 2009 and updated in 2011. Around seventy bird species are found in the area, mostly migratory. The most common two species in the area are stone curlew and pigeons. Wildlife monitoring devices are installed on the runway and workers conduct visual inspections.

The documentation reviewed during due diligence included the following:

2007 Eco Consult Environmental and Social Impact Assessment (ESIA) Environment Baseline Report, 2016 Clean City for Waste Management waste management annual report, 2016 ENVISA QAIA Noise Contours Update report, 2015 Airport Footprints Ltd. (AFL) carbon footprint report, 2017 Airport International Group (AIG) QAIA Environmental, Health, and Safety (EHS) Plan, 2016 Royal Scientific Society Environmental Monitoring Program (EMP), 2016 QAIA  Quality and Safety Management System, 2017 Integrated Management System (IMS) Manual, 2016 AIG Annual Air Quality and Meteorological Monitoring Report, 2016 Jordan Birdwatch Association Bird Strike Report, QAIA Wildlife Hazard Monitoring Report, 2016 QAIA Annual Monitoring Environmental Performance Report as submitted to IFC.

MIGA’s due diligence considered the environmental and social management planning process and documentation for the project and gaps, if any, between these and MIGA’s requirements. Where necessary, corrective measures, intended to close these gaps within a reasonable period, are summarized in the paragraphs that follow and in an agreed Environmental and Social Action Plan (ESAP). Through the implementation of these measures, the project is expected to operate in accordance with MIGA’s Performance Standards.

PS1:  Assessment and Management of Environmental and Social Risks and Impacts

Environmental and Social Assessment:

An Environment Impact Assessment (EIA) was developed by a consultancy firm “EcoConsult” in 2007, and was approved by the Ministry of Environment. The EIA incorporated a baseline study and an environment monitoring plan. The scope of the EIA covered the rehabilitation, expansion and operation of the airport. The impacts of the activities under this project are considered minimal compared to the original project assessed in the EIA, given that this project’s objective is to optimize operations. No additional assessment is required for this project.

Management Program and Monitoring:

Management Systems:

As per the requirements of the Government of Jordan (GoJ) in the QAIA Rehabilitation, Expansion and Operation Agreement (REOA), QAIA obtained certifications in ISO 9001:2015, for the company’s quality management system, and ISO 14001:2015, for their environmental management system. AIG implements a customer satisfaction code of conduct in accordance with ISO 10002:2014, which is a customer complaints management system. The certified operations include: operations of terminals, landside, and airside, information technology and telecommunication, security, commercial operations, customer service, and engineering and maintenance. In addition, in 2013, AIG obtained certification in OHSAS 18001 for their occupational health and safety management system.

AIG developed an Integrated Management System (IMS) in 2009. This system integrates the operator’s activities into one cohesive framework to deliver QAIA objectives and to ensure continual improvement. The IMS demonstrates AIG’s commitment towards best practice by complying with national laws and regulations, ensuring a safe airport operating environment that complies with applicable international aviation standards, as well as meeting the requirements of OHSAS 18001. The objectives are to develop and operate a secure airport, implement a sustainable

carbon management strategy, with a focus on pollution prevention and greenhouse gas emissions reduction. There is an Environmental committee chaired by the Airport Chief Operations Officer, and attended by the Quality and Safety Director and all division heads under the Quality and Safety department. In accordance with Jordanian Labor regulation, AIG has an OHS committee in place focused on improving and implementing systems for a safe working conditions.

In 2013, environmental and occupational health and safety procedures were merged in an integrated EHS plan covering procedures applicable to AIG’s operations, tenants and concessionaires, and AIG contractors. The EHS plan is being updated and expected to be finalized by March 2018. Currently, these procedures are applied only on AIG operations. The environment clause has been included in tenancy and concessionaire agreement templates since 2012.

Monitoring:

AIG has assigned the Royal Scientific Society (RSS) to conduct periodic environmental monitoring. The monitoring program covers wastewater, drinking water, industrial wastewater, soil, stack emissions and sludge resulting from the wastewater treatment plant.

Monitoring results indicate compliance with national regulations as well as World Bank Group (WBG) Environmental Health and Safety (EHS) Guidelines. Tenants include ALPHA (catering), Jordan Aviation (JAV, aircraft operator), JPRC (aircraft fueling), JALCO (aircraft engine maintenance), Joramco (aircraft maintenance), DHL, Duty Free DUFRY, Royal Jordanian Airlines (RJ), Danata (ground handling and catering company for aircrafts at QAIA), Airport Hotel and

Airport Handling Services (AHS). An environmental commitment has been signed by some tenants (JALCO, ALPHA as of now) to encourage non-compliers to adopt corrective action. For new tenants, a clause will be included in the legal agreements to ensure compliance of discharge to the sewage network.

Organizational Capacity and Competency:

AIG Quality and Safety Department has four divisions with four division heads: Quality Assurance (QA), Airport Safety, Customer Knowledge and Satisfaction, and Environmental, Health and Safety (EHS). The EHS section was created in 2013 and EHS procedures were developed in 2014. The EHS division is responsible for operation activities only. AIG has assigned EHS responsibility to the EHS Manager. The Environment management plan was amended per IFC PSs. In 2016, the environment safety handbook was reviewed and updated to include more details on environmental

control measures during operational activities.

Training

Training needs are identified based on performance appraisals and the HR department is responsible for developing the training plan for employees. OHS training is an integral part of the program. In 2016, a total of 8 staff were trained to be IMS internal auditors to cover the four standards (ISO14001: 2015 Environment Management System, ISO 9001:2015 Quality Management System, OSAHS 18001 Occupational Health & Safety, and ISO .10002, Complaint handling). In addition, waste management training was delivered to 24 Janitors & 35 operation airside staff.

Emergency Response Plan

QAIA Emergency plan was last updated in 2017. The plan defines roles and responsibilities and prepares the chain of process in case of incidents or accidents in the airport or immediate vicinity up to 5 km East-West and up to 3 km South-North. An Airport Emergency Plan is implemented. There is a safety Committee that is comprised of representatives from AIG’s relevant departments, as well as representatives from Directorate of Airports Civil Defense, Airport Police Department, General Intelligence Department, Military intelligence, and Ministry of transport.

PS2:  Labor and Working Conditions

Human Resources Policy and Management

The current Human Resources (HR) and Administration policies and procedures manual was developed in May 2013. The manual covers HR resources planning, recruitment processes, performance appraisals, development and training, employees’ leave and benefits, code of conduct, grievances, and harassment. The HR policies and procedures are in line with national Jordanian labor law and IFC Performance Standards 2.

All employees have social security in compliance with the national labor law and health insurance is provided for employees and up to four family members (spouse and children). All employees have contracts. The contracts include period of employment, working hours, salary, employee benefits, number of days of paid annual leave, and any commitments by the employee and employer per national labor law regulations and the internal bylaws.

For administration work, employees work for one shift from 08:30 am till 4:30 pm. However, since the airport has a twenty-four hour, seven days a week operational organization, AIG reserves the right to have certain employees in specific positions work flexible hours and/or in shifts. The flexible working hours are determined based on the position and is agreed upon beforehand in the employment contract.

The company is committed to ensure that employees work for a maximum of 48 hours a week and these working hours are reduced to be 36 hours per week during Ramadan. Any working hours which exceed these limits are considered over time. The maximum overtime hours must not exceed 40 hours per month. The company is also committed to not have employees work for more than five continuous hours without taking a break of at least an hour.

As indicated in the HR policy, all employees in AIG are above 18 years of age. There are no current plans for retrenchment. The total number of AIG employees in 2017 is 435, 15% of whom are female.

Workers’ Organizations

Based on the ratified ILO Conventions that guide PS2, Jordanian Labor Law provides an adequate framework for protection of the basic rights of workers. Workers have the right to establish and join unions, which exercise their rights to collective bargaining. Labor disputes are usually resolved through mediation or arbitration. National labor law prohibits employers from dismissing an employee during a labor dispute.

Numerous AIG employees have joined the General Trade Union of Workers in Air Transport and Tourism.

Non-Discrimination and Equal Opportunity

As per HR policy, AIG has an equal opportunity and diversity policy where the company adopts equality of opportunity and treatment for all employees regardless of their gender, color, ethnic origin, culture, marital status, race and religion.

Grievance Mechanism

QAIA grievance mechanism policy is implemented and provides a tool for handling employee grievances and appeals to ensure achieving equitable, fair and satisfactory treatment. Based on the nature and severity of the grievance, grievances are addressed by a direct manager, the division director or escalated to a grievance committee. QAIA’s HR policy was revised to provide opportunities for anonymous reporting, for both AIG employees and contractors.

Occupational Health and Safety

OHS procedures are implemented to ensure compliance with OHSAS 18001 and related Occupational Health and Safety requirements. These procedures include guidelines for handling hazards and protecting the health and safety of all employees. The OHS procedures cover operations and are managed by the Quality and Safety department. The EHS department keeps records of incidents and inquiries. AIG keeps records of near misses, vehicular accidents, first aid incidents, and fatalities as well as conducting root cause analysis to identify any corrective measures to prevent said events.

PS 3: Resource Efficiency and Pollution Prevention   

Water Use

QAIA’s operations has no impact on nearby communities’ access to water as the airport and the adjacent industrial zone (Al Qastal) are not connected to the public water supply grid.

The airport is connected to separate individual water providers. There are four government permitted wells within airport boundary (2 owned by QAIA and 2 owned by AIG). An additional source of water is supplied by a contractor who sources water from external wells (Al Fayez Wells) and is located outside the airport. The water is tested before use to ensure compliance with regulatory requirements. Chlorination of the water is conducted, and testing is done on daily basis in an AIG laboratory. The annual total water consumption in 2017 was 561,517 cubic meters. External wells supply 79% of water consumption. Plans are underway to install an hourly testing system for water chlorination levels. AIG designed and constructed terminals with water efficient technologies, such as low-flush toilets and low-flow spray taps – to minimize water consumption.

Energy Use

The main source of energy onsite is electric energy which is provided through the national grid. Diesel Fuel is used for boilers (to heat water for winter months only) and generators in case of power cuts. The QAIA site includes two boilers and two generators. Jordan Petroleum Refinery Company is responsible for jet fuel underground storage tanks and the fueling of the aircrafts.

Solid Waste:

In 2013, a contractor named “Clean City” was assigned for collection and disposal of solid waste, hazardous waste, and sludge. Solid waste generation in 2017 was 2380 tons. Waste segregation initiatives have been introduced in QAIA. In the terminals, there are currently three different colored waste bins for paper, plastic and general waste. In the administration building, there is printer cartridge bin segregation. On the airport apron, there are two dumpsters for segregation of Foreign Object Debris (FOD) and chemical containers. The contract with “Clean City” includes awareness raising sessions to AIG staff.

Hazardous waste generation is approximately 15 tons per year. Hazardous waste includes mainly empty chemical containers, used batteries and tires. Hazardous waste is also managed by “Clean City” and is disposed of in a hazardous waste landfill designated by the government. For each trip from the QAIA site to the landfill, an approval is provided by the Ministry of Environment. Clean City also handles used oil and is certified from the Ministry of Environment for this activity.

Hazardous Substances: The hazardous substances warehouse was renovated in 2012. It includes flammable substances such as paints and solvents. This area currently includes firefighting extinguishers and an alarm system, and sprinklers have been included. A review was undertaken on the hazardous substances and waste storage practices to ensure that adequate spill containment, fire extinguishers and sprinklers are in place and operational. Compatibility of storage of substance/waste and accessibility to storage areas, as well as storage practices were reviewed.

Wastewater Management: Both domestic and industrial wastewater generated on site are discharged through the airport internal sewerage network and treated onsite, including the wastewater generated from the tenants’ activities. The wastewater treatment unit managed by AIG entails oil separation, biological treatment, and settling.

Treated wastewater from the wastewater treatment unit managed by AIG, is used for irrigation in the airport area. Irrigated land includes grass and olives and ornamental trees. AIG has conducted an analysis of treated wastewater to ensure compliance with national regulations (JSR 893/2006) for irrigation of category B (fruit trees).

GHG Emissions and Energy Efficiency

AIG has implemented a recognized carbon management program at QAIA. The Airport Carbon Accreditation Scheme (ACI) certification process is composed of 4 levels, namely: mapping, reduction, optimization, and neutrality. AIG achieved accreditation of Level 1 (mapping) in 2013. Level 2 (reduction) was obtained by AIG in 2015 and in 2016 AIG obtained Level 3 (optimization) for calculating carbon emissions from stakeholders.

AIG has completed the mapping level and the results indicated that annual carbon dioxide emissions for which AIG was directly responsible at QAIA in 2015 are reported as 25,467.23 tons of CO2 (tCO2). Methane and nitrous oxide emissions are reported as an additional 6.3tCO2e combined. As per the requirements of MIGA’s PS3, AIG will quantify direct and indirect GHG emissions annually in accordance with international recognized methodologies and good practices.

Passenger numbers at the Airport in 2016 are reported by AIG as 7.4 million. As such CO2emissions per passenger are reported as 3.9kg CO2 per passenger. It has been decided to do re-mapping to take into consideration the new development in the airport. Currently AIG are investigating options for reduction and for getting accredited to Level 2 of the ACI.

Noise Pollution

A noise modeling study was conducted in 2011 covering one year of air traffic to assess the impact of aircraft noise on the surrounding area. The study was carried out using data from 2008, 2010 and provided a forecast for year 2020. The study concluded that in 2008, the population exposed to day night level (DNL) 60 decibels (dB(A)) – numbered 540 only, while in 2010 this had increased to 3,742. For maintenance purposes, the south runway was closed to traffic in 2008 and all the traffic is operated on the north runway, while in 2010 the operational condition was the opposite. The north runway was closed for maintenance and all the traffic is operated on the south runway. Modeling was carried out assuming both runways were operating in 2008 and 2010. Thus, the estimated population exposed to DNL 60 dB were 801 and 1,170 respectively. Traffic forecast in 2020, indicates the population exposed to noise level DNL 60dB(A) ranges from 3,083 to 3,765 based on different traffic forecasts. All modeling results indicate that no population were exposed to DNL 65 dB(A), which is the threshold set by the United States Federal Aviation Administration (FAA).

 

PS 4: Community Health, Safety and Security

Currently the south and north runway are operating. To date, AIG has not received any complaints from the surrounding communities, the closest of which is Al Jizah community, located approximately 15 km north of the airport. However, operating the south runway only has higher impact on the noise levels on the Al Jizah community. Thus, AIG conducts ambient noise measurements at the receptors to ensure that noise exposure levels are within acceptable limits set by the WBG EHS Guidelines or other good international industry practice limits for airports.

Security Personnel:

All security guards are assigned by the Jordanian Armed Forces. They are armed and trained. There is a security committee that is held once a month and is headed by the Chief-Operation Officer (COO) and has representatives from the Jordanian Armed Forces, Civil Defense Authority, Ministry of Interior, and the Project Management Unit (PMU) in the Ministry of Transport.

AIG will coordinate with the government to ensure that the security personnel follow good international practices in term of rule of conduct, training, and equipping. AIG will also ensure that security guards are continuously monitored. In cases where AIG receives any grievances related to the security guards, these will be addressed immediately with the Jordanian government authorities.

The risks associated with the use of Government security for passengers and community members are low, based on the 9 years of AIG’s operating experience at the airport during which there have been no significant confrontations or incidents involving inappropriate use of force. In addition, there are no communities located near the airport and hence security - community interactions are anticipated to be insignificant. Per MIGA’s PS4 requirements, AIG has assessed and is documenting any potential risks to the public associated with the use of armed personnel at the airport.

Stakeholder Engagement:

QAIA is located 36 kilometers south of Amman with the closest community being Al Jizah, with a population of approximately 104,165 inhabitants.

The EIA process for the Airport rehabilitation and new terminal expansion was initiated in 2007 through a scoping meeting, where the Ministry of Environment invited public and private parties who may be potentially affected by the project to participate in the scoping session. At this meeting, the project was described, and the potential environmental and social issues were identified and discussed. After completion of the EIA, the results and finding were disclosed to the public in a disclosure meeting. The results of additional E&S monitoring studies which could have an impact on communities are shared with these communities on a periodic basis, i.e. noise monitoring results.

With the establishment of the Quality and Safety Department, a Customer Knowledge and Satisfaction (CKS) division was introduced. CKS receives grievances from customers as well as from the community. Complaints and feedback are received through comment cards in the airport, via email and telephone. The system allows for receiving anonymous complaints. A complaint must be investigated and replied to within 21 days.

As part of corporate social responsibility activities, in 2014, AIG coordinated with Tekeyet Um Ali NGO to consult with the Al Jizah community, which is the closest community to the airport, and accordingly provided support based on the identified needs. In addition to the CSR activity mentioned above, AIG and the King Hussein Cancer Foundation (KHCF) signed an MoU, in which AIG would provide support to the KHCF Stars initiative. This initiative was launched in 2011. Other initiatives undertaken by AIG include: support to the Al-Aman Fund, which supports orphans, blood donation campaign by AIG employees, and sponsorship of the Union Education Fund offered to children of workers in the transport sector.

As part of Client’s community engagement, the ESRS and the ESAP will be translated into local language and utilized to convey assessment and remedial measures to the local community. Local disclosure of the information will be in publicly accessible place at QAIA and will be published on the AIG website.

The above listed documentation is available electronically as PDF attachments to this ESRS at www.miga.org.  It is also available for viewing at the following locations:

For more information, enquiries and comment please contact:

 

  • Mr. Omri Gainsburg
  • Meridiam Eastern Europe Investments 2 SAS
  • 4, Place de l’Opera
  • 75002 Paris
  • FRANCE
  • Email : ogainsburg@meridiam.com
  • Tel: + 33 1 53 34 96 96
  • Fax: +33 1 53 34 96 99