Mitsui to participate in power generation project in South Africa

• 11 years ago (2013-06-11)
• David Flin

Africa 320 Europe 1088

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Mitsui will participate in two power generation projects that are the first large-scale IPP projects in South Africa. Two project companies established in South Africa, in which Mitsui will invest through its subsidiary investment vehicle in the UK, entered into a power purchase agreement with Eskom.

The projects will sell electricity to Eskom for 15 years from their completion through two power generation plants. One, the Avon Project, involves the construction of a 670MW diesel-fired open-cycle power plant near Durban. The other, the Dedisa Project, involves construction of a 335MW diesel-fired power plant near Port Elizabeth.

The total cost of the projects will be approximately €780 million, and will be financed on a project finance basis following a loan agreement between the project companies and South African lenders. Commercial operation of the Avon project is due to start in the first quarter of 2016, and the third quarter of 2015 for the Dedisa project.

The project companies have received investments from Mitsui, GDF Suez, and two local companies through their own investment vehicles.