- Togo has finalised and signed a deal that will end its dark days once the 100 MW power plant is completed.
ContourGlobal announced yesterday it had signed a US$146 million non-recourse financing agreement with the Overseas Private Investment Corporation (OPIC) for the construction it's 100 MW power plant in Lome, Togo.
The company said the ContourGlobal's Togo project will be the first substantial foreign investment in Togo in over a decade and will be one of the most significant investments in the West African power sector in over twenty years.
The project involves the design, construction, and operation of a new 100 MW thermal power plant, which will produce approximately 780 gigawatt hours of electricity annually and will help the West African nation overcome an electricity shortage that has resulted in rolling blackouts and inhibited its economic growth, said the company in a statement.
It further stated that the project is located within a region that is desperately seeking less expensive and more reliable sources of power adding that the plant will also add a substantial source of clean, reliable, and low-priced electricity and provide diversity to the region's sources of power generation.
The project is scheduled to begin construction in January 2009 and is expected to be operational in December 2009. It will be powered by six Wartsila 18V50DF engines (16.6 MW each), which have tri-fuel burning capability and can operate on natural gas, heavy fuel oil, and distillate diesel oil. However, the company has said the project will operate on heavy fuel oil until natural gas becomes available via the West African Gas Pipeline.
ContourGlobal Togo has entered into a 25-year concession and power purchase agreement under which it will sell electricity generated by the power plant to the Togolese electric distribution company, Compagnie Energie Electrique du Togo.
Joseph Brandt, President and Chief Executive Officer of ContourGlobal, stated, "Entering into this loan agreement with OPIC amidst the unprecedented turmoil in the global credit markets shows that financing is available for well structured projects in developing countries. We value our relationship with OPIC and are grateful to them for the leadership they have shown with their support of this path- breaking project. We look forward to working with them on additional projects in the coming year," he said.
Also commenting on the project was Craig Huff, Co-Chief Executive of Reservoir Capital Group and Chairman of ContourGlobal, who said, "Africa has the world's greatest power needs. With the help of enabling institutions like OPIC, investors can receive attractive risk-adjusted returns while substantially lowering the cost of electricity in the region. ContourGlobal has a significant pipeline of new generation projects in Africa and we look forward to making further investments in the region."
Investments in a new power plant in Lomé, Togo, will double the country's capacity to produce electricity.
The power plant is the largest electricity investment ever made in Togo. When operational, the plant is set to significantly diversify Togo's power generation portfolio and supplement the country's hydroelectric power during the dry season.
Togo has recently been approved for debt relief under enhanced Heavily Indebted Poor Countries, after reaching a decision point under the IMF/World Bank initiative.
Togo is among the poorest countries in the world, with a gross national income (GNI) per capita of US$360 in 2007.
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