Overseas Private Investment Corporation (OPIC), the U.S. government's development finance institution, has granted an $87 million loan to Lekela Egypt Wind Power BOO, a subsidiary of Lekela Power that is developing a 250 MW wind farm in northeast Egypt.
Good news for Lekela Egypt Wind Power BOO. This subsidiary of Lekela Power, an independent power producer (IPP) based in Amsterdam, Netherlands, has recently had its financing application validated by Overseas Private Investment Corporation (OPIC). The United States Government’s development finance institution has confirmed an $87 million loan to Lekela.
These funds are intended for the development of its Ras Gharib wind project in the Gulf of Suez, in northeastern Egypt. The IPP has received a clearance from the New and Renewable Energy Authority (NREA). The institution responsible for managing renewable energy projects in Egypt has granted a strip of land to accommodate wind turbines capable of producing 250 MW.
Financing still awaited…
The electricity produced by the Ras Gharib wind farms will be sold to the Egyptian Electricity Transmission Company (EETC), pursuant to a 20-year power purchase agreement (PPA). This public-private partnership (PPP) project is part of the Egyptian government’s strategy. “By diversifying the country’s energy sources, reducing costs for consumers and increasing electricity production capacity, the project will expand access to electricity in Egypt – creating economic opportunities that empower the Egyptian people,” said David Bohigian, OPIC’s Executive Vice-President.
The $87 million loaned by OPIC will not be enough for the construction of the Ras Gharib wind farm. With this in mind, Lekela is seeking the support of several other financial partners such as the International Finance Corporation (IFC), the World Bank’s corporate finance subsidiary, which is expected to contribute $82 million to the project. Lekela is also seeking support for the project from the European Bank for Reconstruction and Development (EBRD) with an investment of $81 million.
Jean Marie Takouleu