CENPOWER GENERATION COMPANY LIMITED
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
Cenpower is a greenfield 340 MW combined cycle independent power plant (IPP) constructed in Kpone, Ghana, capable of operating on either light crude oil, or (when gas becomes available:) on gas. The Engineering, Procurement & Construction contractor is Group Five. The plant will sell its energy to national utility ECG. There is a long-term one-stop integrated Fuel Supply Agreement in place with Vitol Group, a leading oil trading company with strong presence in West Africa. Start of operation is expected in 2018. The Sponsors are experienced with a good track record: Africa Finance Corporation (31.85%), Sumitomo (28%), local sponsor CHL (21%), Mercury (being effectiveley FMO's partner AIIM, 15%), and FMO (4.15%). AFC is an African-led international financial institution, established in 2007 whose mission is to improve African economies by proactively developing and financing infrastructure, industrial and financial assets. The plant is expected to begin operations in 2018, and will sell its energy to national utility firm ECG. There is a long-term, one-stop integrated Fuel Supply Agreement in place with Vitol Group, a leading oil trading company with a strong presence in West Africa.
What is our funding objective?
FMO is providing a US$24 million senior loan and a US$20 million subordinated loan as working capital for the fuel finance. FMO is also participating with an equity stake. FMO is also the lead arranger of the European Development Finance Institution (DFI) senior debt and the subordinated debt, mobilizing a total of US$163 million from five DFIs: DEG from Germany, OFID from Austria, Development Bank of Southern Africa (DBSA), Industrial Development Corp (IDC) and Emerging Africa (EAIF). A US$447 million senior finance facility with a cover from the Export Credit Insurance Corporation (ECIC) is also being arranged by Rand Merchant Bank (including capitalized ECIC premium).
Why do we fund this investment?
Ghana's is a fast growing economy. Due to consistently high demand and limited supply of energy, the country suffers regular power outages. The Cenpower plant will increase the power supply by approximately 15%, providing much needed base load to the grid. Thanks to its modern turbines and combined cycle technology, the plant will operate at a higher fuel efficiency and with better environmental performance than existing power infrastructure. The plant is expected to operate on fossil fuels for the moment. However, once gas becomes available operations will switch over to this fuel, reducing the environmental impact of the plant. The combined cycle technology will be the cleanest fossil solution with the highest efficiency.
More investments
| Date | Total FMO financing |
|---|---|
| 10/2/2014 | USD 20.00 MLN |
| 9/24/2014 | USD 12.68 MLN |
- Region
- Africa
- Country
- Ghana
- Sector
- Energy
- Effective date
- 10/2/2014
- Total FMO financing
- USD 24.00 MLN
- Funding
- FMO NV
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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+