By Chris Ochayi
The Multilateral Investment Guarantee Agency, MIGA, the political risk insurance and credit enhancement arm of the World Bank Group, has pledged its support for the Azura-Edo Independent Power Producer, IPP.
The power project which requires about US$900 million has reached financial close is expected to bring reliable and affordable energy to the nation’s grid, aimed at serving nearly 12 million residential consumers.
The MIGA support according to a statement weekend, is part of a larger programme being implemented by the World Bank Group to mobilise nearly US$1.7 billion of private-sector financing to support Nigeria’s energy reform programme in general.
“In particular, the World Bank, the International Finance Cooperation (IFC), and MIGA have worked jointly to finance Azura-Edo with a package of guarantees, loans, and political risk insurance,” the statement said.
MIGA’s guarantees for the project total $492 million. They cover equity investments by Amaya Capital Ltd., American Capital Energy and Infrastructure, Aldwych Azura Limited, the African Infrastructure Investment Fund 2 Power Holding, and Asset and Resource Management Ltd.
MIGA is also covering commercial lending by Siemens Bank, KfW IPEX, Rand Merchant Bank, and Standard Bank—with Standard Chartered Bank acting as agent on behalf of the lenders. Hedging instruments by Standard Chartered and RMB are also covered by MIGA’s guarantees.
Azura-Edo is the first wholly project-financed IPP in Nigeria, and “consists of the construction, operation, and maintenance of a 459-megawatt, gas-fired, open-cycle power plant in the vicinity of Benin City, Edo State, Nigeria.
“It also includes the construction of a short 330-kV transmission line connecting the power plant to the Benin North substation and a short underground gas pipeline spur connecting the power plant to the country’s main gas trunk line. The project will deliver power not only to Nigeria, but also the broader West African Power Pool.