DFC Disburses 1st Tranche for 105 MW Gas Power Plant in Sierra Leone
On 10 December 2024, the US International Development Finance Corporation (DFC) effected its first disbursement for a USD 292 million loan package in support for the implementation of the gas power plant in Sierra Leone. This power project is jointly financed in partnership with the #ECOWAS Bank for Investment and Development (EBID).
The power plant will utilize a Combined Cycle Gas Turbine (#CCGT) with a total capacity of 105 MW. Located in the capital Freetown, it will nearly double the electricity generation capacity of Sierra Leone when in full swing. This gas-to-power plant project is also known as the “NANT Energy Project” or simply as “NANT Project”.
The Governments of Sierra Leone and the US have agreed to partner together to upgrade the generation capacity of the west African nation to one gigawatt (1 GW) over the coming decade. Currently, the country relies heavily on standalone diesel generators which can only be an ad hoc solution due to the high costs involved for lack of better alternatives.
“As the regional development finance institution serving the Economic Community of West African States (ECOWAS) region, EBID is proud to play a catalytic role in unlocking the vast potential of West Africa. Our partnership with DFC to finance this critical energy infrastructure project in Sierra Leone marks a significant milestone in this journey, supporting the country’s transformative path towards economic growth, improved fiscal balance, and a brighter future for its people.”
ECOWAS Chair Dr George Donkor
As a key partner on this project, Anergi Group is proud to contribute to the realization of the energy strategy of Sierra Leone. Moreover, the project is aligned with the Climate Action Plan of the US Millenium Challenge Corporation (MCC) and Just Energy Transition (#JET) and Green Growth Plan of Sierra Leone.
Anergi Group is registered in the Mauritius jurisdiction and works to enhance electricity access across Africa. Its aim is to invest in energy projects across Africa in order to close the electrification gap. Synergy Consulting acted as Financial Advisor on the deal.
The project construction will be carried out by a #JV between Milele Energy and TCQ Power. Both companies specialize in developing power plants in the MENA region. The CEO of TCQ Power Karim Nasser underscored the NANT Project as a model for power partnerships to bring reliable and affordable power to a country. “Together, we are lighting the path to a brighter, more prosperous future for this nation and its people,” commented CEO Nasser.
“The scale and impact of the NANT Project make it a standout example of what DFC and partner institutions like EBID can accomplish when working together with our private sector partners to benefit the communities where we operate. This transaction is a major milestone for Sierra Leone’s energy security and economic development and represents the largest percentage increase in energy capacity in a single country of any DFC project.”
DFC CEO Scott Nathan
The vision of ECOWAS is that of an economically integrated and prosperous region. To that effect, #EBID provided finance to the tune or more than USD 4.2 billion to improve energy access and enhance other infrastructure. Currently, more than 70% of the population in Sierra Leone does not have access to the electricity grid.
As per global best practices, the NANT Project is carried out on a Public-Private Partnership (#PPP) whereby the state agrees to purchase the electricity produced from the private sponsors building the power plant. Thus, a Special Purpose Vehicle (#SPV) has been registered in Sierra Leone to act as the Independent Power Producer (#IPP) with an offtake agreement with the state utility company.
In September 2024, #MCC reached a compact with Sierra Leone worth USD 480 million to transform the electricity sector, with #DFC earmarking USD 412 million in financing and political risk insurance in support of the initiative.
The NANT Project officially kicked off in June 2024 in the presence of the Sierra Leone President Julius Bio, the US Ambassador Bryan Hunt, the #ECOWAS representative as well as representatives from the companies involved in the project. According to the project plan, the power plant will become operational within three years.