Africa infra fund loans $91m to Rwanda power project

Together with various development banks, the Emerging Africa Infrastructure Fund, which provides long-term debt to infrastructure projects in sub-Saharan Africa, has agreed to loan $91.25m to a methane gas extraction facility and 25-MW power plant in Rwanda.

The Emerging Africa Infrastructure Fund (EAIF), together with the Netherlands Development Finance Company, the African Development Bank, and the Belgian Investment Company for Developing Countries, has agreed to loan $91.25 million to a methane gas extraction facility and power plant on Lake Kivu in Rwanda.

The project, known as KivuWatt, is sponsored by ContourGlobal,  a New York-based power developer that operates projects in the US, Mali, Nigeria, Togo, Brazil, Colombia and parts of Europe, according to the firm’s website.

The loan will support the first phase of the project, which involves construction of a methane gas extraction and production facility as well as a 25-megawatt power plant whose electricity will be sold to Rwanda’s Energy, Water and Sanitation Authority, according to a statement.

The EAIF, which is managed by a division of Standard Bank called Frontier Markets Fund Mangers, was established in 2002 to provide long-term debt for private infrastructure  projects in sub-Saharan Africa.  The EAIF’s equity sponsor, which provided $150 million for the fund, is the Private Infrastructure Development Group, whose current members include public development agencies in the UK, the Netherlands, and Sweden, the Swiss Secretariat for Economic Affairs, and the World Bank-affiliated International Finance Corporation (IFC), according to the Group’s website.

In July, the IFC approved an additional $150 million of senior debt to the $600 million EAIF in order to enable the fund to invest in new projects through 2013, according to the IFC website.  The IFC said it had previously committed a senior loan of $36.25 million and a liquidity facility of $12.5 million to the EAIF.

ContourGlobal was founded in late 2005 by the firm’s chief executive Joseph Brandt together with Reservoir Capital Group, a New York-based fund that manages assets of more than $5 billion.