28 February 2022
TEMPLARS advised Access Bank, Stanbic IBTC Bank and the Asset Management Corporation of Nigeria in connection with the restructuring and refinancing of a US$500 million debt provided to the Geometric Power Group for the Aba Integrated Power Project.
The project has exclusive rights to supply power to 9 out of Abia State’s 17 Local Government Areas and is reputed to be the most significant power project to close in Nigeria since the closing of the Azura-Edo circa $1 billion 459MW gas-fired project which TEMPLARS acted as counsel to the sponsors and the project company.
The restructuring helped to unlock an additional US$50 million in debt financing from the African Export-Import Bank (“Afreximbank”) to Geometric for the re-acquisition of the exclusive rights to supply power to the Aba Ring-Fenced Area, a 4000 km sq area in Southeastern Nigeria with a population of over two million people including more than 300,000 electricity customers. The additional Afreximbank debt will also be utilized for the completion of remaining works and the commissioning and commencement of operations on the Aba Integrated Power Project.
The exclusive rights to the Aba Ring Fenced Area were officially transferred to Geometric Power on 16 February 2022 by the Federal Government of Nigeria through its privatization agency, the Bureau for Public Enterprises following a decade-old legal dispute over the Area between Geometric and Interstate Electric (owners of the Enugu Electricity Distribution Company). The long dispute effectively stalled the take-off of the Aba Integrated Power Project, thus hindering the promise of 24-hour power supply to the city of Aba, one of Nigeria’s most important commercial, industrial and export centres.
The Aba Integration Power Project is unique for being a fully integrated generation and distribution project with capacity to generate and distribute 141MW in the first phase. The generation facilities will be owned and operated by the generation arm of the utility, Geometric Power Aba Limited, while the distribution side (comprising over 140km of new distribution lines, four new sub-stations and three rehabilitated sub-stations) will be managed by APL Electric Company Limited. Geometric Power Aba Limited also has a 27km dedicated gas pipeline and related facilities to ensure uninterrupted gas supply from Shell to the project area.
The TEMPLARS team on the restructuring was led by partners, Desmond Ogba and Chike Obianwu, who were supported by Senior Associates Munachi Michael and Osarugue Izekor; and Associates Bibiana Idabor and Jeremiah Ojo.