China Eximbank provides RMB 800.9 million government concessional loan for Phase 1 of Nairobi 132kv and 66kv Network Upgrade and Reinforcement Project (Linked to Record ID#31295)

Project narrative

On November 1, 2013, China Eximbank and the Government of Kenya signed an RMB 833,000,000 ($130,368,000) government concessional loan (GCL) agreement for Phase 1 of Nairobi 132kv and 66kv Network Upgrade and Reinforcement Project. The face value of the GCL was subsequently revised to RMB 800,961,538.46. This loan, which is captured via Record ID#36048, carried the following borrowing terms: a 2% interest rate, a 20 year maturity, and a 6.5 year grace period. It was scheduled for repayment in semi-annual installments from March 21, 2020 to September 21, 2033. The Government of Kenya, in turn, signed two separate on-lending agreements with Kenya Power and Light Corporation (KPLC), a state-owned enterprise. A loan worth $87,498,024 was provided with a 3% interest rate and a 20 year maturity and a $42,560,031 loan was provided with a 3% interest rate and a 20 year maturity. The borrower made no principal repayments on the RMB 800,961,538.46 loan between July 1, 2020 and June 30, 2021 (Fiscal Year 2020-2021) and it made repayments worth RMB 64,076,923.04 between July 1, 2021 and June 30, 2022 (Fiscal Year 2021-2022). The loan’s amount outstanding was RMB 833,000,000 as of June 30, 2020, RMB 800,961,538.46 as of June 30, 2021, and RMB 736,884,615.38 as of June 30, 2022. Then, on May 10, 2014, China Eximbank and the Government of Kenya signed an RMB 660,000,000 government concessional loan (GCL) agreement for Phase 2 of Nairobi 132kv and 66kv Network Upgrade and Reinforcement Project. This GCL, which is captured via Record ID#31295, carried the following borrowing terms: a 2% interest rate, a 19.66-year maturity, and a 6.75-year grace period. It was scheduled for repayment in semi-annual installments from September 21, 2021 to March 21, 2034. The borrower made no principal repayments on the RMB 660,000,000 loan between July 1, 2020 and June 30, 2022 (Fiscal Year 2020-2021 and Fiscal Year 2021-2022). The loan’s amount outstanding was zero as of June 30, 2020, zero as of June 30, 2021, and zero as of June 30, 2022. The project’s first and second phases involved the: (1) installation of 220kV underground cable from Embakasi substation in Nairobi West region to proposed 220/66kV gas-insulated substation (GIS) at the Nairobi Railways compound (2) development of 66kV underground cable network linking all major substations in the city (Westlands substation, Parklands substation, Jevanjee substation, Cathedral substation, Nairobi West substation, Ngong Road substation and associated substation extension); (3) establishment of 66/11kV substations at Likoni Road in Nairobi's Industrial Area and Kiu River in Kiambu; and (4) modernization of Cathedral Substation in the Nairobi's City Centre. The project sought to enhance power supply quality within Nairobi's Central Business District and serve the Industrial area, Mombasa road, Upper Hill, the entire Central Business District (CBD), Lower hill, and Kilimani area. The contractor responsible for project implementation was TBEA Co., Ltd (特变电工). The project (9 substations, 40 km of transmission cable) commenced on August 14, 2014 and reached completion on May 30, 2018. The originally scheduled project commencement and completion dates were July 10, 2014 and November 30, 2020, respectively.