This week, the Africa Finance Corporation (AFC), a multilateral development finance institution, announced the signing of a joint development agreement with Ivoire Hydro Energy SA (IHE), an Ivorian project development company, for the development of the 44MW Singrobo hydropower plant in Ivory Coast.
The hydropower project development expenses will be jointly financed by AFC and FMO, the Dutch development bank, through the joint AFC-FMO Project Development Facility.
The Facility will provide a project development equity investment of up to $3 million. Under the agreement the AFC will invest a further $3 million to take the project to financial close, with both parties having the option to acquire further equity in IHE.
Hydropower power purchase agreement
AFC will work in collaboration with other developers to complete detailed technical studies, finalise the Power Purchase Agreement (PPA), participate in procuring the engineering, procurement and construction contractors, lead the processes for preparing project costs, and oversee the final environmental and social impact assessment studies.
Andrew Alli AFC’s President and Chief Executive Officer, commented: “AFC’s long term vision is to help address Africa’s infrastructure deficit and ensure sustainable economic growth for the continent.”
Alli further added that: “… as the lead developer in this transformational regional infrastructure power project, which will … [provide] long-term infrastructure financing, value added infrastructure asset project development expertise and importantly deliver bankable projects, but also accelerate regional integration by bridging the power deficit in West Africa, and making an economic difference in the development of the sub-region”.
The hydropower project will have a 35-year take or pay PPA with Ci-Energies, Ivory Coast’s public utility company, under the management of the Ministry of Energy and Petroleum Products.
The generated power will be transmitted from a 11/225 KV switchyard to the 225KV Taabo-Abidjan transmission line, through a proposed 225 kV circa 4 km transmission line from Singrobo.
This hydropower investment further consolidates AFC’s track record in Ivory Coast whose membership of the Corporation is imminent.
The key investments include the $297 million financing of the flagship transport infrastructure project; the Henri Konan Bedie bridge and the $55 million loan facility with the Port Autonome d’Abidjan (PAA) for expansion works to the Abidjan Port complex.