Endeavor Energy hopes to secure financing by the end of the year for a $900 million gas-fired power project in Ivory Coast to help meet its growing electricity demands.
The Africa-focused power producer, which is based in Houston, plans to operate a terminal that will import liquefied natural gas (LNG) to fuel a power plant that when fully operational will produce 1,200 Megawatts.
Endeavor has approval to build the plant that will initially produce 375 MW, and has secured a power selling agreement with the Ivorian government, the company’s chief executive Sean Long told Reuters at an investment forum in Ivory Coast.
Now it is focused on funding, said Long, who is confident of “an over-supply of financing” for the project.
Endeavor will provide the equity capital with backing from energy and resources-focused private equity firm Denham Capital.
It expects additional funding from multi-lateral institutions including the U.S. Overseas Private Investment Corporation, the World Bank’s International Finance Corporation and the African Development Bank.
Ivory Coast, the world’s top cocoa grower and French-speaking West Africa’s largest economy, has emerged as one of Africa rising stars after a decade of political turmoil.
President Alassane Ouattara said on Monday that the economy grew by 10.3 percent in 2015.
Demand for electricity is rising by some 10 percent annually, and the energy minister said last year that $20 billion in power investment is need over the next 15 years.
Meanwhile, offshore natural gas production, which has until now fed the power grid, is falling.
“With the declining low-cost natural gas there’s a shortage of fuel supply,” Long said. “They need a sustainable and reliable fuel supply that’s also environmentally friendly.”
Endeavor has secured a provisional agreement with Royal Dutch Shell to take seven to eight cargoes per year of LNG in the first phase of the project, which will be ramped up as power output capacity increases.
The price of the LNG is subject to approval from the government. Growing global supply should keep prices competitive with Ivory Coast’s local supply, Long said.
The company plans to charter a specialised floating LNG tanker from Texas-based Excelerate Energy that can store and regasify the LNG offshore before piping it to the power plant.
Preliminary studies for the LNG terminal will be completed in three or four months, Long said.
Source: Reuters