South African financial service group Standard Bank will provide debt financing of $170-million to accommodate the development of a 118 MW gas-fired power plant under-construction by a Mozambican company, Gigawatt.
Ressano Garcia, Mozambique will be home to the power project which has been confirmed with a long term strategic power purchase agreement between Gigawatt and government owned utility Electricidade de Moçambique (EDM).
EDM stated that the generated electricity will be used to electrify local energy consumers with the future objective being to limit imports from South African.
Head of investment banking at Standard Bank Mozambique Ronaldo Toledo says the deal follows several other gas-related transactions, but is the first project-financed independent power producer initiative to reach financial close in Mozambique – the project reached financial close on June 20, 2014.
The Gigawatt plant would be constructed over an 18-month period by a joint venture comprising WBHO Construction and Parsons Brinkerhoff. Engines for the gas plant were to be supplied by Rolls Royce and would be operated by TSK.
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