From: News Release – African Press Organization (APO)
US $870m Financing Agreements Get Signed as Biggest Clean Power Energy Project in Africa
Lake Turkana Wind Power – Africa’s biggest Wind Power Project reaches key milestone
JOHANNESBURG, South-Africa, March 24, 2014/ — The Lake Turkana Wind Power Project (http://ltwp.co.ke) meant to add an existing 300MW of reliable, low cost wind energy to the national grid of Kenya reached a critical milestone following the signing of the financial agreements in Nairobi, Kenya.
Photo: http://www.photos.apo-opa.com/index.php?level=picture&id=735 (Tshepo Mahloele, CEO of Harith General Partners)
The signing of the over US $870m financing agreements represents a major breakthrough to actualizing the biggest clean power energy project in Africa, spanning years of negotiations and fundraising, says Tshepo Mahloele, CEO of Harith General Partners (http://www.harith.co.za).
The project will be financed with a mixture of equity, mezzanine debt and senior debt.
The Lake Turkana Wind Power project is the first of its kind in East Africa and will be the largest wind project on the continent to date, says Mahloele. The Project will benefit Kenya, and specifically the Turkana area where unemployment is high, with jobs, economic development and, most importantly, electricity which is a vital element in any economy.
LTWP has signed a 20 year Power Purchase Agreement with the government of Kenya through its electricity entity, Kenya Power.
The parties at the signing ceremony were represented by lead developer and independent power producer, Aldwych, which is majority owned by the Pan African Infrastructure Development Fund (PAIDF). LTWP is primarily responsible for the financing, construction and operation of the wind farm and comprise a grouping of investors and lenders with extensive financial and technical capabilities and experience on the African continent. They include FMO, Vestas, Finnfund, IFU and a strong local sponsor KP&P on the equity side. The syndicate of banks is led by the African Development Bank and comprises Standard Bank, Nedbank, EIB, DEG and Proparco.
The project will be located on one of the best sites for a wind farm in the world. Not only are the wind speeds exceptionally high but the wind is only from one direction, is not seasonal, and is low in turbulence. The project site is situated on the southeast border of Lake Turkana between two high ranging mountains in the Turkana Corridor where a low level jet stream originating in the Indian Ocean creates favourable wind conditions.
Mahloele says the LTWP will essentially assist diversify Kenya’s energy mix and reduce the country’s reliance on power production from oil and diesel power generators. The Kenya government will save millions per year on importing fuel. The LTWP tax contribution to Kenya alone will be approximately $27m annually and $548m over the life of the investment.
Mahloele says the combination of international financial and technical expertise has ensured that the project is structured in a bankable and sustainable form in accordance with international standards.
This project also forms part of Harith’s commitment to the United States backed Power Plan announced last year by the US President Barack Obama to bring more than 10 000 MW of electricity to sub Saharan Africa. Through Power Africa, Harith has committed $70m for wind energy in Kenya and $500m across the African power sector through a new fund.
Mahloele says the investment is the result of the forward thinking and planning on the part of the Kenyan leadership who had undertaken comprehensive power sector reforms over the past decade.
In Kenya, electricity is mainly generated from hydro, thermal and geothermal sources. Wind generation accounts for less than six megawatts of the installed capacity. Currently, hydro power comprises over 52 percent of the installed capacity in Kenya and is sourced from various stations managed by the Kenya Electricity Generating Company (KenGen).
It is our assertion that the Lake Turkana Wind Project will greatly reduce Kenya’s over reliance on hydropower which is playing a critical role in ensuring security of electricity supply but is however vulnerable to periodic draught seasons, says Mahloele.
Distributed by APO (African Press Organization) on behalf of Harith General Partners (Pty) Ltd.
For more information contact: Pule Molebeledi Investor Relations and Communications Executive, Harith General Partners +27 11 384 4002 or Pule.Molebeledi@harith.co.za
About Harith General Partners
Harith General Partners (http://www.harith.co.za) is the leading Pan-African fund manager for infrastructure development across the continent. Based in South Africa, Harith manages Africa’s first and only 15-year infrastructure fund, the Pan African Infrastructure Development Fund (PAIDF) and also owns London based asset manager Frontier Markets Fund Manager Limited (FMFML). FMFML has USD1.1bn asset under management and manages two funds: The Emerging Africa Infrastructure Fund (EAIF); and GuarantCo. The PAIDF US $630m fund is invested in a number of major projects in diversified sectors such as energy, transport and information, communication and telecommunications. http://www.harith.co.za
Harith General Partners (Pty) Ltd