The Eu85 million ($108 million) debt financing for the 88.6MW Rabai independent power project (IPP) in Kenya is remarkable for being not only the first power project financing in the country since the TSAVO Power IPP project in 2000, but also for closing against the backdrop of debt market turmoil and at the originally agreed pricing.
The 20-year BOOT concession has had a troubled birth, having been tendered twice and taken through the courts by a despondent losing bidder.
The deal was initially sponsored by Aldwych International and Burmeister & Wain Scandinavian Contractor A/S (BWSC), who won the first tender in 2005 for what was then called the Embakasi project.
The Embakasi tender was for a plant near Nairobi airport but airport authority concerns over interference with air traffic and the high cost of bringing fuel from Mombasa resulted in the project being moved to Rabai, 20km from Mombasa. The relocation of the project prompted a re-tendering by Kenya Power and Lighting Corporation (KPLC) in 2006 which Aldwych and BWSC again won with an energy cost bid of US$c13.4035/kWh – beating rival bids...
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