E-Power S.A.

completed

The Project is the first IFC infrastructure project in Haiti. It is to construct, own, and operate a 30MW Heavy Fuel Oil (“HFO”) diesel power plant on a build-own-and-operate (“BOO”) basis in Port-au-Prince. The project will sell its capacity and electricity to the state-owned utility, Electricité d’Haiti (“EDH”), under a 15-year Power Purchase Agreement (“PPA”). The project benefits from sovereign guarantee and tax and duty exemptions under a Implementation Agreement (“IA”) and a Sovereign Guarantee with the Republic of Haiti. The project will be undertaken on a quasi full-turnkey basis by Hyundai Heavy Industries, Co. Ltd (“HHI”) and its spin-off, DECCO Ltd (“DECCO”) of Korea. The foreign sponsor, the Basic Energy Group (“BEG”), will be the operations and maintenance (“O&M”) operator. Fuel will be sourced from a large international fuel supplier. Total project costs are about $50 million to be financed on a 75:25 debt to equity basis. Construction period is expected to be about 18 months. The project is the first private-sector generation project in the country, which has been selected on the basis of international tendering processes undertaken with the help of the World Bank. Currently, the country relies largely on another private-sector generator which owns and runs Light Fuel Oil (“LFO”) diesel facilities. Being a HFO diesel facility, the Project will be significantly more cost-competitive than the existing LFO facilities at a total electricity cost of about US¢ 15-17 per kWh as compared with US¢ 22-26 per kWh for the LFO facilities at about a crude oil price of about US$ 60 -80 per bbl. In light of the current dire financial conditions of the state-owned utility, the project is expected to be paid largely through the budgetary transfer from the government, as has been the case for all the other private-sector generation projects. Such budget transfer accounted for about 7-8% of total government expenditures in the recent years. This is expected to remain at about the same level even with the commencement of the Project and other projects currently in the pipeline, assuming no improvement in the cash recovery rate of the state-owned utility and continuing growth of government budgets in line with its recent trend