Enel Green Power has signed an agreement with a subsidiary of Qatar Investment Authority (QIA) for a joint venture partnership aimed at developing renewables in Sub-Saharan Africa. The JV will engage in financing, building and operating renewable projects in the region. The parties also signed an agreement whereby QIA will acquire 50% of EGP’s stake in projects in operation and under construction in South Africa and Zambia with approximately 800MW capacity.
In this first phase, the transaction involves the acquisition by QIA of 50% of EGP’s stake in four projects under construction in South Africa and two plants in operation in the same country as well as in Zambia, for a total capacity equal to approximately 800MW. The overall transaction is subject to the “change of control approval” and “antitrust clearance” from relevant institutions and regulatory authorities. Under the transaction, EGP and QIA will form a new legal entity for future developments in Sub-Saharan Africa. After closing, all legal entities may be merged into a sole joint venture company.
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The agreement
Under the agreement, EGP will be responsible for the development of each project and the joint venture has the right to invest in the projects following the successful completion of the development phase by EGP and receipt of any required regulatory approvals. At that point, the joint venture will be in charge of financing and building the new renewable projects.
This overall transaction is in the framework of the “Stewardship” businessmodel, in line with the Group’s Strategic Plan for 2021-2023, whereby the Group provides key services, products or know-how enabled by platforms catalyzing investments of third parties to maximize value creation. EGP, including through its local subsidiaries, will support each project in the joint venture, in relation to the funding, construction and operation activities.
The initial portfolio, for an overall installed capacity of about 800MW, consists of one plant already in full operation in Zambia (the Ngonye PV plant, of 34 MW), one recently-connected plant in South Africa (the 148 MW Nxuba wind farm), and four projects under construction (for a total of 587 MW), namely the South African wind farms of Oyster Bay (148 MW), Garob (145 MW), Karusa (147 MW) as well as Soetwater (147 MW). These plants hold long-term power purchase agreements. Oyster Bay, Karusa, Soetwater and Garob are expected to start operating during 2021.
In South Africa, Enel Green Power will retain ownership of more than 500 MW including the wind farms Nojoli (88 MW) and Gibson Bay (111 MW), as well as solar plants Upington (10 MW), Adams (82.5 MW), Pulida (82.5 MW), Tom Burke (66 MW), Paleishuewel (82.5 MW).
