World Bank Group support to bring electricity relief to 163,000 households in Cameroon

World Bank Group support to bring electricity relief to 163,000 households in

Cameroon 

WASHINGTON, November 10, 2011   The World Bank and the International Finance 
Corporation (IFC) Boards of Directors today approved an US$86 million loan and 
US$82 million Partial Risk Guarantee to support the Kribi Gas Power Project 
that is expected to supply reliable electricity to over 160,000 households in 
Cameroon. The US$86 million IFC loan and US$86 million International 
Development Association (IDA) guarantee will enable Cameroon s first long-term 
project finance from local banks to the electricity sector. 

The Kribi power project --the first power plant to run on natural gas in 
Cameroon -- has two main components: The first consists of the development, 
construction and operation of a new 216MW natural gas-fired power plant located 
near the Mpolongwe village, nine kilometers north of the coastal city of Kribi 
in South Province of Cameroon. The second consists of the development and 
construction of a new 100-kilometer 225-kilovolt double-circuit transmission 
line between the Kribi power plant and the existing Mangombe 225/90-kV 
substation at Edéa in Littoral Province, including substations and 
transformers. 

 The project targets 163,000 households or approximately 815,000 people, 50 
percent of whom are women. Combined with the 50 MW of capacity the project will 
indirectly supply to Alucam, the country's aluminum smelter, we expect very 
positive benefits for the economy , said Gregor Binkert, Country Director for 
Cameroon.

The project was conceived against the background that Cameroon s 1,021 megawatt 
capacity is insufficient to meet its electricity demand and the development of 
low-cost hydropower including the Lom Pangar dam on the Sanaga River is not 
expected before 2015. Cameroon has the potential to generate up to 6,000 MW of 
reliable all-season hydropower on the Sanaga River in the medium term. The 
Kribi Gas Power Project provides a low-cost gas power supply option that is 
necessary to come on-line by the latter part of the dry season 2012/2013 and 
that increases reliability in a mainly hydropower-based system. 

The Government of Cameroon and the AES Corporation, the private sponsor, have 
created the Kribi Power Development Company (KPDC) to implement the Kribi gas 
project as a public private partnership. The total cost of the project is 
estimated at US$350 million.
 
 The Kribi gas power project will increase the capacity and reliability of 
power supply in Cameroon through the mobilization of private financing, 
including local currency financing. The Project utilizes the IDA guarantee 
instrument in an innovative way to allow Cameroon s local commercial banks to 
support investments in the power sector for the first time. This will build 
capacity of local banks to provide long-term finance for infrastructure 
projects, raise local currency revenues for the project and reduce exposure to 
foreign exchange risk for end-consumers , explained Astrid Manroth, Senior 
Energy Specialist and Task Team Leader for the Project.

In addition to providing direct financing, IFC is also coordinating the 
Development Finance Institutions including the African Development Bank (AfDB), 
European Investment Bank (EIB), Netherlands Development Finance Company (FMO), 
the French Promotion and Investment Company for Economic Cooperation 
(PROPARCO), and the Central African Development Bank (BDEAC) that will provide 
about 61 percent of project debt through parallel loans amounting to 
approximately US$181.7 million equivalent. 

The power plant will run on natural gas using diesel as backup fuel. Natural 
gas will be supplied from the offshore Sanaga South gas field in Cameroon -- 
the first gas field being developed for commercial use by Perenco Cameroun. AES 
Sonel, Cameroon s national utility will be the sole off-taker for the power 
produced by KPDC.  

 IFC is pleased to partner with one of our key clients, the AES Corporation, to 
deliver the Kribi gas power project, which will have a significant impact for 
Cameroon. The project is aligned with IFC s long-term strategy for Africa which 
aims to overcome structural constraints to private sector development and to 
support improvement to power infrastructure,  said Yolande B. Duhem, IFC s 
Regional Director.

As of end October 2011, the Cameroon portfolio comprises 12 national 
IDA-financed operations with total net commitments of US$477.7 million, 
excluding the Kribi Gas Power Project.  Cameroon also benefits from an 
additional 5 regional projects with commitments totaling US$496.4 million. 
About 6.7 percent of the World Bank Group s financing is in energy. 

Contacts: 
In Washington: Aby Toure, (202) 473-8302, akonate@worldbank.org; 
In Cameroon: Hélène Pieume + 237 22 20 38 15, hpieume@worldbank.org

For more information on the Lom Pangar Project, please visit 
www.worldbank.org/lompangar 

 

Leave a Reply

Your email address will not be published. Required fields are marked *