AES Kelvin Power

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AES paid R200 million (US$16.7 million) for a 50% stake of Kelvin Power Station, a 600 MW coal-fired plant located just outside Johannesburg in November 2001. AES Kelvin Power, a subsidiary of AES South Africa Holdings, signed a 20-year power purchase agreement with City Power Johannesburg, a local distribution company. The acquisition of the power plant - known as the Kelvin A and Kelvin B plants - included the plant's related business and assets. The project created the first independent power project in the Republic of South Africa. Although Johannesburg Metropolitan Municipality retained 50%, full operating control was transferred to the project company. AES Kelvin Power was 95% owned by AES South Africa and 5% by black economic empowerment Group Global African Power Limited (GAP) having an option to increase its ownership to 13% over five years. AES committed to invest US$15 million in repairs to modernize the plant with a new bag filtration system to make it one of the cleanest plants in South Africa. In April 2003, AES sold its 95% stake in AES Kelvin to CDC Globeleq, the power sector subsidiary of Commonwealth Development Corporation (UK). AES sold its stake in Kelvin with its stake in Tanzania's Songas Limited for a combined US$337 million. Globeleq withdrew from the Kelvin plant in 2006, leaving its stake to the South African banks who financed the reconstruction project: Investec and Nedbank Capital. The banks named facilities-management company Pangaea as interim operator, and were looking for to leave the project in 2007. The plant was purchased currently being arranged by Deutsche. The full amount will be in local currency and Deutsche with corporate funds, but will be taken off balance sheet with a R600 million facility is in discussions with the leading South African banks. In addition to refinancing acquisition costs, the facility will fund R 140 million ($11.7 million) pledged for upgrading and the remainder sill be spent on operating costs. RMB closed a 12-year US$38m local currency project financing for AES Kelvin Power Project in September 2002. None