ICBC contributes $29.7 million to syndicated loan for 50MW Benban 1 Solar Photovoltaic Power Plant Construction Project (Linked to Record ID#57965)

Project narrative

On October 18, 2017, ACWA Benban One for Energy JSC — a special purpose vehicle and joint venture of ACWA Power, Al Tawakol Electrical Co. incorporated in Egypt (Al Tawakol), and Hassan Allam Holding incorporated in Egypt (Hassan Allam) — and the EBRD and the Industrial and Commercial Bank of China (ICBC) signed a $59.4 million syndicated loan agreement for the 50MW Benban 1 Solar Photovoltaic Power Plant Construction Project. Both the ICBC and ERBD contributed $29.7 million (EUR 27.5 million) as lead arrangers of the loan. The loan carries a maturity of 18 years. Its interest rate and grace period are unknown. However, is it known that the borrower purchased a credit insurance policy from the Multilateral Investment Guarantee Agency (MIGA). On December 15, 2017, MIGA signed a contract in which it agreed to issue guarantees to ICBC for its investment into ACWA Benban One for Energy JSC. The guarantees are issued for up to 20 years against the risks of Transfer and Convertibility Restrictions, Breach of Contract, Expropriation and War and Civil Disturbance. The scope of the $77.5 million project included the design, development, construction, commissioning and operation of a 50MW solar photovoltaic power plant located in the Benban solar complex (محطة بنبان للطاقة الشمسية) in the Aswan Province of Egypt. The power plant was developed under Egypt’s Feed-in Tariff (FiT) scheme. ACWA Power was granted a 25-year Power Purchase Agreement (PPA) and it will sell the power generated by the three solar plants to the state-owned Egyptian Electricity Transmission Company (EETC) (the off-taker). The project was allocated to plot 43-4 (approximately 86 hectares (Ha)) in the Benban solar complex. The project was expected to have alternating current capacity of 50 MWAC and peak direct current capacity of 67.5 MWDCP, and it was expected to be linked to substation 4 (SS4) on the southeastern corner of the Benban complex via an underground 22 kilovolt (kV) transmission line following the internal routes right-of-way (RoW) installed by EETC. SS4 covers an area of 50 km2. The Benban solar complex comprises a 37-square kilometer (km2) area allocated to Egypt's New and Renewable Energy Agency (NREA) located in the western desert, 15 km west of the River Nile and approximately 1 km west of Aswan – Luxor highway. The complex is approximately 650 kilometers (km) from Cairo. With the exception of the narrow and densely populated Nile Valley with its intensive agriculture, the area is all desert land, largely unused and unpopulated. The area is mainly flat, with sand and gravel dunes, and with no notable natural vegetation and no human activities. The nearest villages are Benban village, about 12 km east and Fares village about 25 km northeast of the Benban solar complex, with 26,200 and 11,000 inhabitants respectively. The nearest cities are Aswan, 40 km south and Luxor 140 km north. The Benban solar complex was sub-divided into 39 plots each allowing for a solar plant of up to 50 megawatts (MW) with a total capacity for the entire site of up to 1.8 Gigawatts (GW). A consortium that consisted of Astroenergy and CGGC (China Gezhouba Group Corporation) International was the Engineering, Procurement, and Construction (EPC) contractor responsible for project implementation. First National Operation & Maintenance Co. Ltd (NOMAC) — a fully owned subsidiary of ACWA Power — was the Operations and Maintenance (O&M) contractor. On January 7, 2018, this project reached financial closure. The project was originally scheduled to commence in the first quarter of 2018 and reach completion (operations) by the fourth quarter of 2018. It ultimately reached its commercial operations date (COD) in the third quarter of 2019.