Page 14 - AfrElec Week 23 2022

AfrElec GAS GENERATION AfrElec

World Bank issues $150mn

guarantees for Azura’s gas plant

MOZAMBIQUE THE World Bank has issued guarantees to an weather, improve the quality of electricity supply,
independent power producer in Mozambique to and forge a pathway towards renewable energy
cover up to $150mn for its equity into and loans options.”
to a gas-fired plant in the southeastern African CTRG, situated at Ressano Garcia in south-
country. ern Mozambique, has been running since 2015.
The Multilateral Investment Guarantee Its gas comes by pipe from an onshore field at
Agency (MIGA), a member of the World Bank Temane.
Group, said in a release that its guarantees to Azura Power’s chief executive, Alan Muir,
Azura CTRG Holdings of Mauritius (Azura) said the company was happy to complete the
for 13 years will cover against risks of breach of acquisition of CTRG. “This represents a signif-
contract (BOC) and transfer restrictions (TR). icant milestone for our business and is hopefully
In December 2020, Azura agreed to acquire just the first of many Azura projects in Mozam-
a 49% stake held by Sasol New Energy Hold- bique, a country and power sector which we
ings Pty Ltd (SNE) of South Africa in 175MW have long seen as strategically important,” he
Central Termica de Ressano Garcia (CTRG) said. “When combined with our assets in Nigeria
and requires MIGA coverage to complete the and Senegal, we are now strongly positioned for
transaction. future growth in three of Africa’s leading gas-to-
Apart from the $149.85mn guarantees to power economies.”
Azura, MIGA has issued the same to Absa MIGA’s guarantees to cover Absa were a pre-
Bank Limited of South Africa (Absa) for up to requisite for Azura’s acquisition of SNE’s stake in
$36.5mn in loans to CTRG against the risks of CTRG. Originally, Absa had obtained political
TR, BOC, expropriation, war and civil distur- risk insurance from SNE’s parent company, Sasol
bance, which are also needed to facilitate owner- Limited. With SNE’s withdrawal from the pro-
ship transfer. The cover is for eight years. ject this protection ended, thus MIGA stepped in
MIGA’s guarantee will allow Azura to acquire to supply the necessary coverage so Absa could
and operate CTRG, owned by Electricidade de continue providing long-term lending to CTRG.
Moçambique (EDM), Mozambique’s state- “We are very pleased to have included MIGA
owned electricity utility, with a 51% stake and in the financing structure for the transaction,”
by SNE with a 49% stake. After the acquisi- said Theuns Ehlers, head of resource project
tion, Azura will own 49%, EDM 46%, with the finance at Absa. “We believe that the MIGA guar-
remaining 5% held by CTRG itself in treasury. antee will enhance the existing finance package
“MIGA’s guarantees are essential for draw- in place for the transaction. We understand that
ing in financing in support of Mozambique’s the CTRG project is a strategic project to the
ambition of delivering universal access to elec- electricity supply ambitions for Mozambique.
tricity,” said Hiroshi Matano, MIGA executive Absa looks forward to working with Azura as
vice president. “This financing package will new owners and with MIGA on this project and
help strengthen the plant’s resilience to extreme many others in the future.”™

P14 www. NEWSBASE .com Week 23 09•June•2022