22/01/2007: Signing a Loan Agreement of KD 30,000,000 for the financing of Al-Atf Power Generation Station Project in the Arab Republic of Egypt

A loan agreement was signed today in the City of Cairo between the Government of the Arab Republic of Egypt and Kuwait Fund for Arab Economic Development, whereby the Fund will make a Loan of Kuwaiti Dinars (K.D.) 30,000,000/-, equivalent to about U.S.$ 102 million, to the Government of the Arab Republic of Egypt to assist in the financing of Al-Atf Power Generation Station Project. An agreement (Project Agreement), concerning arrangements for implementation of the Project, was also signed between Kuwait Fund for Arab Economic Development and West Delta Power Generation Company which is undertaking the Project.

The Loan Agreement was signed on behalf of the Arab Republic of Egypt by Her Excellency Mrs. Faiza Mohammed Abu Al-Naja, the Minister of International Cooperation, while the Project Agreement was signed on behalf of West Delta Power Generation Company by engineer Refaat Al-Mutawalli M. Abdulazzim, Chairman of the Board of Directors and Managing Director of the said Company. Mr. Abdulwahab Ahmed Al-Bader, Director-General of Kuwait Fund for Arab Economic Development, signed both the Loan and Project Agreements on behalf of Kuwait Fund. 

The project aims at meeting the increasing demand for electricity on the national grid of the Arab Republic of Egypt and improving the performance of the grid through enhancing the reliability of supply of electricity by adding a 750MW combined cycle power generation station to be connected to the national grid. 

The project consists of the construction of a combined cycle power plant West of the Delta on the site of the existing Al-Atf Power Station about 190 km from Cairo. It comprises two gas turbine units and their auxiliaries with a nominal capacity of 250 MW each, using natural gas as base fuel and solar fuel as stand-by and one steam unit 250 MW capacity as well as a 220 KV transmission line and its auxiliaries to connect the new power plant to the national grid. The project also includes the removal of the existing buildings and equipments pertaining to the old power plant, the engineering services and supervision of construction. 

The total cost of the Project is estimated at about Egyptian Pounds 2209 million, equivalent to about K.D 115 million, of which about Egyptian Pounds 1557 million, equivalent to about K.D 81 million and representing about 70.5% of the total cost of the Project, will be in foreign exchange. The Loan will cover about 26% of the total cost of the Project. 

The Loan is made for a term of 21 years, including a grace period of 5 years, and is to be amortized in 32 semi-annual installments, the first of which will be due on the first date on which interest or other charges on the Loan will fall due, in accordance with the Loan Agreement, after the expiry of the said grace period. The Loan bears an interest at 2.5% per annum, in addition to 0.5% per annum to cover administrative costs and other expenses incurred in the implementation of the Loan Agreement. 

By making this Loan, Kuwait Fund for Arab Economic Development will have made 28 loans to the Government of, or public entities in the Arab Republic of Egypt with a total amount of K.D. 398 million, equivalent to about U.S. Dollars 1353 million or Egyptian Pounds 7734 million, for the financing projects in various sectors. In addition, Kuwait Fund made six technical Assistance grants of a total amount of about K.D. 1.1 million allocated for various purposes including the financing of technical and economic feasibility studies for certain projects, assisting in financing the activities of the Center for Strategic Documents on Economic and Social Reform and financing the preparation of a master plan for the development of the regions of Lake Nasser. Kuwait Fund also administered two grants made by the Government of the State of Kuwait and amounting in total to about KD 4.8 million for the purpose of reconstruction of schools damaged by the earthquake in 1993 and villages affected by floods in 1995.