US$24.5 Million Dollars Power Project For Liberia
By: Charles Crawford
Posted February 4, 2004
If all goes well, Monrovia and its environs will be electrified through a US$24.5 million Independent Power Project concept earmarked for Liberia.
According to a dossier of the Independent Power Project which is in the possession of this paper, the project has its genesis in an arrangement between the Liberia Electricity Corporation and a foreign company, AIMS Enterprise, Inc., a corporation registered in the State of Delaware, USA, and its affiliate, AFIPCO, UK, Ltd. under which the latter is to arrange and secure funds for supply of power generating equipment to develop a 20 megawatt (MW) power station, and to reactivate the power generating and distribution activities of LEC in Monrovia.
The document states that AIMS/AFIPCO has entered into another arrangement with British Engineering Services Group (EUROPE) Ltd. and Puma Manufacturing Ltd. to jointly implement the independent power project for Monrovia. The project will have the potential of extending electrical power supply services to secondary cities of Monrovia, such as Kakata, Buchanan, etc.
AIMS/AFIPCO in collaboration with the equipment suppliers, proposes to introduce a self-financing program that will provide for the installation and operation of an independently managed power supply system for Monrovia and the rehabilitation of the power transmission and distributor system serving Greater Monrovia.
According to the dossier, the scope of the project will cover the following specific activities: the design, supply and install a distribution system including poles, overhead, underground cables, transformers, street and traffic lights. The distribution system will start from the above power plant and would be sufficient to absorb the output of the 20MW plant. Routine maintenance will be carried out by the LEC after installation.
With regards to the investment cost and financing, the direct cost associated with the purchase, shipment, installation, and commissioning of generator sets, supply of conductors, transformers, metering equipment, management fees, construction of a powerhouse, the initial supply of fuel and lubricants, administrative expenses and project start-up-costs are estimated to be about US$24.5 million.
The sponsors of the independent power project concept have secured a five-year term credit of US$24 million through LOITA Capital Partners International to cover all immediate investment costs for the establishment and operation of the 20MW power station in Monrovia. This loan will be disbursed in a single tranche and will be collateralized by a first mortgage of all power generating equipment and other fixed assets associated with the 20MW power plant.
The International Bank (IB), LBDI and ECOBANK are serving as judiciary agents for sale of prepaid meter cards and collection of fees for meter installation, and shall also make annual levy which shall not exceed one percent against total funds collected from power consumers.
On the investment cost recovery, the independent power producers, AIM/AFIPCO will charge a basic rate of US$0.18 per KWH for power supplied to the LEC power transmission and distribution grid. This tariff represents the population cost per KWH of US$0.16 plus a profit of US$0.02.
Payment of the initial investment costs and accrued interest charges will be spread over the period of 5 years, from the date of the commencement of power supply to registered customers.
The implementation plan of the power project should have started in the first week of January 2004 upon receipt of the letter of concession from Liberian authorities, granting ALMS/AFIPCO the right to install and operate the 20MW power station and to transmit power to customers through the LEC power grid.
The duration for the entire exercise of which Monrovia and its environs would be electrified is 7 months- it should have been from January 4, 2004 to July 4, 2004.
Being curious to know about the delay in the implementation of the independent power project, this paper contacted Mr. Wilbert Stubblefield, Executive Vice president of ALMS Enterprise Inc. said, reasons for the delay were far beyond his knowledge.
"I don’t know what is responsible for the delay in getting the letter of concession from the LEC management to enable us start the project.