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Projects

Project Brief

Summaries of proposed guarantees are provided prior to Board consideration and before final contract signing, and they are therefore subject to change. Project briefs are disclosed after Board consideration and contract signing and reflect the terms of the project at the time of contract signature. Environmental and Social Review Summaries are provided for projects assigned an Environmental Assessment Category of A or B.

 

Project name
Hydelec BPA
Project ID
3689
Fiscal year
2002
Status
Not Active
Guarantee holder
Hydelec
Investor country
France
Host country
Madagascar
Environmental category
A
Sector
Power
Gross exposure
 $2.0 million
Project type
Non-SIP

MIGA has provided Hydelec of France with guarantees totaling $2.06 million for its $2.21 million equity investment in, and shareholder loan to, Hydelec BPA for a power project in Madagascar. The guarantees are for ten years and provide coverage against the risks of transfer restriction and inconvertibility, expropriation and war and civil disturbance.

The project is the construction/installation, operation, and maintenance of a greenfield 10 MW thermal peaking power station, which will provide electricity to the capital city of Antananarivo. Madagascar suffers from daily brownouts and blackouts, and the project will help alleviate this problem by supplying approximately 10 percent of the capitals electric consumption in peak periods. The reliability of the power supply will be improved, and one immediate consequence will allow a number of electricity-dependent local companies will be able to extend their daily hours of operation. The project will employ and train 17 people, 16 of whom are local.

This is the first private foreign energy project in Madagascar, and through a positive demonstration effect, it is expected to encourage further foreign direct investment into Madagascars electricity sector. It will also free up capacity at the state-owned utility company to proceed with required maintenance of its own generating facilities, which at present are over-strained. The project will pay approximately $2.2 million in taxes, including royalties and duties, to the government.

 
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