Investors get financial close for Nigerian power megaproject

Azura Power Holdings Ltd announced that it has completed commercial and financial close of its flagship 450MW Azura-Edo Independent Power Project (Azura-Edo IPP) in Edo State, Nigeria.

In december 2013, American Capital Energy & Infrastructure (ACEI), the infrastructure asset management arm of American Capital, Ltd., announced that it had committed to invest up to US$130 million in Azura Power Holdings Ltd.

Other investors in Azura Power Holdings Ltd include Amaya Capital, Aldwych International, African Infrastructure Investment Managers and ARM of Nigeria.

The US$750 million transaction involves US$220 million of equity and US$530 million of debt. Lenders for the Azura-Edo plant include Standard Chartered Bank (SBK), the lead fundraiser, Rand Merchant Bank, First City Monument Bank Plc (FCMB) and FMO, the Dutch development finance company.

The Azura-Edo power project is a proposed 450MW open cycle gas turbine power station being developed near Benin City in Edo State and represents the first phase of a 1,000MW power plant facility. Azura and the Nigerian Bulk Electricity Trading Plc signed a groundbreaking power purchase agreement on April 22, 2013, which is being used as a template for other project-financed independent power producers in the country.

Construction is expected to start in the next few months and will be led by Siemens AG and Julius Berger Nigeria Plc, the country’s biggest construction company. The Azura-Edo plant, which will come on stream in 2017, represents the first phase of a 1,500-megawatt facility in the southern Edo state near a government transmission line, and on the Escravos-Lagos gas pipeline corridor.

The United Nations estimates that Nigeria’s population will reach 230 million within the next 20 years, and the total grid-based power generation capacity must rise, during this period, by at least tenfold to meet the demand.