Afreximbank signs $50m new debt financing for Geometric Power IPP Project

African Export-Import Bank (Afreximbank) has signed a US$50 million Term Loan facility with Geometric Power Limited in connection with the Aba Integrated Power Project in Nigeria.

The deal was signed in Durban during the second Intra-African Trade Fair (IATF 2021).

The facility provided by Afreximbank to Geometric Power Limited will finance the initial capital required to acquire rights to the Aba Ring Fenced Area. It will also support the completion of remaining works, and the commissioning and commencement of operations of the Aba Integrated Power project in Southeastern Nigeria.

In this connection, Afreximbank successfully completed its Advisory and Capital Raise Mandate for the Aba Integrated Power Project. The Bank advised Geometric Power, the Project Sponsors, on restructuring and arranging gap capital in the $332 million recapitalization funds for the Aba IPP Power Project.

The Aba Integrated Power Project is a fully integrated generation and distribution utility located in Osisioma, Aba, Abia State, in Nigeria and comprising a gas-fired embedded power plant with General Electric Gas Turbines, with an initial capacity of 141MW, to be upgraded to its licensed 188MW capacity. The power plant will be owned and operated by the generation arm of the utility, Geometric Power Aba Limited. The distribution arm will be operated by APL Electric Company Limited and has state of the art infrastructure to curb any loss, including overhead lines and sub stations. Geometric Power Aba Limited also has a 27km dedicated gas pipeline and related facilities to provide reliable power at all times to its franchise area. The project has exclusive rights to supply power within a 4000km2 area, covering 9 out of the State’s 17 Local Government Areas.

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Benedict Oramah, (Professor) President of Afreximbank, said, “Afreximbank is proud to be part of this great milestone achievement by having resolved this recapitalization and financing. In line with the Bank’s Fifth Strategic Plan and in particular the strategic pillars related to financing, industrialization and Export Development, the commissioning of the Aba Integrated Power Project embodies Afreximbank’s objectives in many dimensions and could possibly be a tipping point towards the industrialization of Nigeria through stable power supply.”

Bart Nnaji, (Professor) Chairman and CEO of Geometric, said, “It is a privilege to sign the Aba IPP Restructuring Transaction Agreement today in the presence of the President of Afreximbank, the Governor of Abia State, the host of Aba Integrated Power Project (Aba IPP), and other dignitaries present from Nigeria and many other countries.

The Aba IPP will supply electricity to over 2 million people and more than 300,000 electricity customers including Small, Medium and Large Enterprises, thereby directly touching many lives in the southern part of Nigeria, with a ripple effect on the value chain across the nation. Being one of the only 24hr reliable power suppliers, Aba IPP will; revive moribund industries, power the Enyimba Economic City as well as markets such as the famous Ariaria International Market that harbors entrepreneurs mostly involved in the export value chain. We deeply appreciate the entire Afreximbank team who have worked tirelessly for nearly five years to bring this transaction to maturity. We also thank the original lenders to the Aba IPP including Access Bank and former Diamond Bank, Stanbic IBTC Bank, and Asset Management Company of Nigeria for their vision. We are deeply grateful to Afreximbank and its management led by Benedict Oramah for supporting the vision of the Aba IPP project.”

The Abia State Governor in his remarks stated that the Aba IPP project will transform the economy of Abia State and will be critical to the success of the Enyimba Economic City project in the State. It will ensure that the over 250,000 SMEs in the State who export their projects will have reliable electricity supply to enable them to standardize their products and reduce their cost of operations.