Bujagali Hydro Project

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In April 2005, the government of Uganda awarded Bujagali Hydro Project to the private consortium Bujagali Energy Ltd. The project, designed as an independent power producer, consisted of a 30-year BOT for the development, construction and maintenance of a run-of-the-river power plant with a total capacity of 250 MW (5 X 50 MW turbine generators) on the River Nile, at Dumbbell Island, 8 kilometers north of the existing Nalubaale and Kiira power plants, in Uganda. An associated power transmission system, the Bujagali Interconnection Project, is a separate proposed project sponsored by Uganda Electricity Transmission Company Limited (UETCL) that will distribute the hydro electricity to the Ugandan power grid. Bujagali Energy Ltd (BEL) was owned by Sithe Global Power LLC (57.4%), Aga Khan Fund subsidiary’s Industrial Promotion Services Limited (30.9%), and the Government 0f Uganda (11.7%). Bujagali Energy Ltd won the project through an international bidding which took place in March 2005 and two other bidders (Stucky Consulting Engineers Ltd and Wakisi Hydro Consortium) submitted final bids. In December, 2005 Bujagali Energy Ltd signed a 30-year Power Purchase Agreement (PPA) with UETCL and an Implementation Agreement (IA). At the same time, the Government of Uganda committed to guarantee UETCL’s payment obligations under the PPA through a government guarantee. The first 50MW became operational in February 2012. The last 50MW became operational in June 2012. The project total cost was estimated at US$799 million. In December 2007, the Bujagali hydropower project reached financial closure with the following financial structure: US$171 million in equity (US$151 million from Project Sponsors and US$20 million from the Government) and US$627 million in loans (US$130 million from IFC, US$130 million from EIB, US$115 million from commercial banks, US$110 million from African Development Bank, US$142 million from European Development Finance Institutions). In addition, the government of Uganda signed for the project a US$115 million partial risk guarantee on the commercial loans from the International Development Association and an US$115 million investment guarantee from the Multilateral Investment Guarantee Agency. The hydropower plant was expected to be commissioned in 2011. In April 2011, it was confirmed that the total cost of the dam had been revised upwards, to US$ 860 million. In June 2012, an additional US$5.3 million equity was guaranteed by MIGA. On July 27, 2012, MIGA amended its guarantee to include an additional $5.3 million of coverage to World Power Holdings Luxembourg S.à.r.l. (WPH), an affiliate of Sithe Global (USA). On June 22, 2018 MIGA provided political risk guarantees of up 20 years for equity investors in Bujagali Energy Limited. Investments revised upwards: $799 to $860 (data April 2011)