Wednesday, January 5, 2011

AfDB Extend to Egypt USD 550 Million Loan for a New 650 MW Power Plant

CAIRO, Egypt, December 24, 2010/African Press Organization

A USD 550 million African Development Bank Loan, approved on 15 December 2010, will help Egypt build a new 650 MW power plant.
“Our loan – USD 550 million, the biggest ever granted to Egypt in a single operation – shows how the African Development Bank takes seriously power generation,” said Hela Cheikhrouhou, Energy, Environment and Climate Change Director.
Located in Suez city, approximately 150 km east of Cairo, the city capital, the 650 MW steam cycle power plant will leverage Egypt’s abundant gas reserves. “Natural gas being the cleanest option in fossil fuels, the government’s policy is to implement an effective natural gas development and domestic utilization strategy to reduce domestic oil consumption with a view to becoming at least self-sufficient in oil supply,” added Mrs. Cheikhrouhou.
The Suez Project will help enhance the socio-economic development of Egypt by increasing power generation in the country. When completed, the project will contribute 5.5% of the targeted increase in the installed generation capacity to reach 41 GW by 2017.
Power will be evacuated from the plant to the power grid through 220 kV network by rehabilitating the existing double circuit over-head transmission line and implementing two additional underground cables.
The electricity sector in Egypt has achieved remarkable progress. Access to electricity is almost universal throughout the whole country with coverage over 99%. Electricity has been made available to the various sectors of the economy including industry, tourism, transport, agriculture, the commercial and social sectors. The availability of affordable and reliable electricity has significantly contributed to the growth of the economy.
The AfDB has significantly contributed towards making the sector efficient. It continues to play a key role in the development of the sector and ensuring sustainable development of the generation capacity to the benefit of the Egyptians.
Since 1974, the AfDB has co-financed the development of seven power generation plants, one transmission project and two rural electrification projects. It also provided grant funds for several studies. As a matter of result, by the end of 2004, the AfDB-supported power generation projects provided some 4,000 MW to the unified power grid (about 31% of the installed capacity then) while the rural electrification projects connected three towns and close to 200 villages.
The African Development Bank is also actively supporting the Egyptian government’s efforts in diversifying its energy sources. To help the government achieve its objective of providing 20% of the electrical energy from renewable sources, mainly hydro and wind, by 2020, the AfDB is considering financing a 200 MW wind energy project and a 100 MW solar power project.
Currently, the AfDB is co-financing three ongoing power generation projects (Kureimat Combined Cycle Power Plant, Abu Qir 1300 MW Steam Power Plant and the Ain Sokhna 1300 MW Steam Power Plant) for a cumulative lending amount of approximately USD 1 billion, accounting for about half the AfDB’s overall active portfolio in Egypt.

SOURCE: African Development Bank (AfDB)