Takoradi International Company (Tico) has secured US$330mn in project financing for the 110MW expansion of its gas-fired power plant in Ghana.

The Netherlands Development Finance Company (FMO) acted as mandated lead arranger on a 15-year, US$212mn syndicated loan split between FMO itself (US$80mn), Proparco, the private sector investment arm of the Agence Française de Développement (US$40mn), ICF Debt Pool (US$30mn), DEG (US$24.9mn), the Emerging Africa Infrastructure Fund (US$15mn) and the African Development Bank (US$22.2mn).

The remaining US$118mn was provided by the International Finance Corporation (IFC) and the Opec Fund for International Development (OFIC), with a tenor of 16 years.

According to FMO structured finance energy specialist Bernhard van Meeteren, negotiations took a year and a half, and were accelerated by the fact that only FMO and the IFC took part in them.

“We were asked to arrange [the loan], but the IFC said that it needed to be its own negotiator because it is a large party and it was the fourth time it had been approached for financing on this project. So there were two parties around the table, negotiating on behalf of a large group. This system was much closer to commercial bank syndication, and it substantially improved the efficiency of the process,” he tells GTR.

Tico is a joint venture between Abu Dhabi National Energy Company (Taqa) and Volta River Authority (VRA), the main generator and supplier of electricity in Ghana. The Takoradi II plant, located in Aboadze, Western Ghana, is operated by Taqa through its wholly owned subsidiary Taqa Generation International Operating Company.

Taqa also made a US$25mn equity investment into the project, bringing financing to US$355mn. The project comprises the expansion of Takoradi II, operational since September 2000 as a 220MW simple-cycle power plant, with a 110MW turbine powered by steam heated by the exhaust heat of the Takoradi II gas turbines, which will result in a 330MW combined-cycle thermal plant. Construction firms Mitsui & Co (Japan) and KEPCO E&C (Korea) are expected to start the expansion this month.

In a controversial twist last year, several Ghanaian newspapers reported that Taqa had allegedly inflated the official price of expansion works in order to pay bribes to members of the Mills-Mahama National Democratic Congress, when seeking approval for the expansion in 2009. The reports were based on a letter allegedly sent by Taqa’s former CEO, Peter Barker-Homek, to the US Securities and Exchange Commission.