QUADRAN BURKINA FASO S.A.
Status: Approved investmentWhy disclosure?
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Disclaimer
The information as disclosed is indicative and provided on an "as-is/as available" basis for general informational purposes only and should not be construed as financial, legal or investment advice, nor as a commitment or an offer to arrange or provide any financing. The final decision to provide financing is subject to the terms and conditions of FMO in its sole and absolute discretion. When providing links to other sites, FMO bears no responsibility for the accuracy, legality or content of the external site or for that of subsequent links. The information on proposed investment for high-risk investments is made available in the language relevant to the country or region where the bulk of operations take place. Translations of any information into languages other than English are intended as a convenience for local stakeholders. In case of any discrepancy, the information provided in English will prevail.
Who is our customer
FMO is investing into Quadran Burkina Faso S.A (“Zano”), an SPV established under the laws of Burkina Faso with a total syndicated debt of EUR 20.25 million. The Sponsor is Qair S.A.S formerly known as Quadran International, “Quadran” or “Qair”, which is the development arm of French Renewable Energy company Lucia Holdings
What is our funding objective?
FMO’s loan of EUR 9.10 million (split equally between FMO-A and AEF) will catalyse another EUR 9.10 million from Proparco both for an 18-year tenor. In addition, a further EUR 2.06 million loan will be provided from AEF which will have a longer 20-year tenor. This financing will allow for the development, construction, operation and maintenance of a 24MWp solar farm with a total project cost of EUR 25.7 million near Tenkodogo in Burkina Faso.
Why do we fund this investment?
This is a greenfield renewable energy development in a low-income sub-Saharan country. Zano will provide clean, reliable electricity to a country that has one of the lowest electrification rates in West Africa at a lower price than current thermal power stations. The FMO-A investment is highly additional as there are no commercial banks in Burkina Faso that can provide financing over the 18-year tenor required to make the projects work. The tenor extension of 2 years provided by the AEF tranche improves the bankability of the Projects without further depressing the margin on the senior loan to a level that would make FMO-A unsuitable. These are among the first true project financed energy IPPs in a Low-income country with poor access to electricity.
What is the Environmental and Social categorization rationale?
E&S Category B+, all IFC PSs triggered except PS7, as there are no Indigenous Peoples groups affected by the project. Key E&S focus areas include marginal economic displacement, security personnel, community engagement, benefit sharing and minimising impacts on biodiversity, including some biodiversity restoration. While local communities and authorities are supportive of the project, proactive management of the project-community relationship and avoiding project-induced intra-community tensions are key areas where the company will continue to focus their efforts, given the deteriorating security context in Burkina Faso, where minor issues can escalate fast. A project-specific environmental and social management system with plans and procedures addressing all relevant areas, including the above, will be implemented by the project company and cascaded down to contractors and subcontractors.
More investments
| Date | Total FMO financing |
|---|---|
| 8/23/2021 | EUR 4.55 MLN |
| 8/23/2021 | EUR 4.55 MLN |
- Region
- Africa
- Country
- Burkina Faso
- Sector
- Energy
- Effective date
- 8/23/2021
- Total FMO financing
- EUR 2.06 MLN
- Funding
- AEF-I
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Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk
Environmental & Social Category
(A, B+, B or C) - B+