Malta’s Delimara 4 power plant reaches US$540 million financial close

This article is part of a daily series of IPP articles. If you want to know more about the latest power generation projects globally visit our IPP Today section. You can receive them by email on a daily basis.

A consortium of eight international banks has signed a financing agreement for the Delimara 4 power plant project in Malta. 

The consortium is comprised of Bank of Valletta, BNP Paribas Fortis, Credit Industriel et Commercial, DZ Bank AG, HSBC Bank Malta, KFW-IPEX Bank, Natixis Bank and Societe General. The package amounts to EUR450 million (US$540 million).

The project consists of a 210 MW combined cycle power plant (CCPP) and a regasification plant with a floating gas holder for LNG (liquefied natural gas). The LNG is stored in the floating gas holder (a converted LNG tanker), which is firmly anchored at an adjacent plant's landing stage. The LNG is converted into natural gas in the regasification plant. This natural gas is used as fuel in both the new Delimara 4 power plant and the existing 150 MW Delimara 3 power plant.

The Delimara site is situated near the city of Marsaxlokk in the south-east of Malta. The new CCPP went into operation in summer 2017.

The project is owned and operated by ElectroGas Malta, a private company with three shareholders: Siemens Project Ventures GmbH (33.33%), SOCAR Trading SA (33.33%), and GEM Holdings Limited (33.34%). The company were awarded an 18-year contract for the project in 2013 by Enemalta, Malta's only energy supplier. Enemalta purchase the power produced by the plant.

KfW IPEX-Bank has provided additional financing for the project, through a bridging loan of EUR112 million (US$134.4 million) to finance the construction phase.

The project was conceived as part of the Maltese government's drive to switch the island's energy supply from oil to gas, in order to reduce emissions and comply with EU environmental requirements while maintaining base load supply. The new CCPP and LNG regasification plant with floating gas storage is now the primary source of electricity for Malta.

Approximately 740 MW on-demand generation capacity is needed for the 440,000 inhabitants of Malta. The project directly and indirectly covers almost 50% of this through the Delimara 4 power plant (generating 210 MW) and gas deliveries to the neighbouring Delimara 3 (generating 150 MW).