Africa Growing Together Fund provides EUR 10 million loan for 34.1MW Kinguele Aval Hydropower Plant Project (Linked to Umbrella Record ID#36104)

Project narrative

On May 22, 2014, the African Development Bank (AfDB) and the People's Bank of China (PBOC) signed an agreement to initiate the Africa Growing Together Fund (AGTF) (see Umbrella Record ID#36104). The purpose of this $2 billion loan facility was to finance large development projects in Africa between 2014 and 2024. The AGTF is sponsored by the PBOC and administered by the AfDB. Then, on July 2, 2021, AGTF signed an EUR 10 million loan agreement (ID#5050130000501) with Asonha Energie S.A — a special purpose vehicle and joint venture of Meridiam (60% equity stake) and Gabon Power Company (40% equity stake) — for the 34.1MW Kinguele Aval Hydropower Plant Project. On the same day, the African Development Bank (AfDB) issued an EUR 30 million loan to Asonha Energie S.A for the same project. Additional funds for the EUR 178.5 million project came from the Sustainable Energy Fund for Africa (“SEFA”), the International Finance Corporation (“IFC”), the Canada - IFC Renewable Energy Program for Africa (“REPA”), Development Bank of Southern Africa (“DBSA”), and Emerging Africa Infrastructure Fund (“EAIF”). China’s state-owned contractor Sinohydro will build the project on behalf of Asonha Energie S.A. The borrower was expected to use the loan proceeds to finance an EPC contract with Sinohydro that was signed on October 24, 2019. The project was to involve the design, construction, and operation of a 34.1-megawatt hydropower plant with a net annual generation of 203-gigawatt hours. The hydropower plant was planned to consist of a 48m high, 250m long conventional concrete gravity dam with 210m long embankment dam that would divert water to a surface powerhouse. This powerhouse would contain 3x12MW vertical axis Francis turbines, with a maximum flow rate of 90m³/s. The Kinguélé Aval dam was planned to be built on the Mbei River, 90 km east of Gabon’s capital, Libreville, downstream from the Tchimbélé (69 MW) and Kinguélé upstream (58 MW) hydroelectric plants. Two hydro dams, built upstream in the Mbei Valley, will regulate the river. All electricity generated by the independent power project (IPP) is expected to be sold to the Government of Gabon (“GoG”) on a Take-or-Pay basis. The project's originally scheduled commencement and completion dates were April 1, 2021 and April 1, 2024, respectively. Sinohydro is the EPC contractor responsible for project implementation. The project's environmental impact assessment (EIA) study -- including local stakeholders consultations -- was undertaken between October 2017 and July 2018. Then, on October 25, 2019, Gabon's Ministry in charge of Environment issued a certificate of EIA conformity. On April 21, 2020, a public utility decree was issued. Then, in November 2023, the first loan disbursement took place.