Nachtigal hydropower project

Financial close was reached on 24 December for the €1.26bn 420MW Nachtigal hydroelectric project in Cameroon. Financing agreements were signed on 8 November and the owners spent the remainder of the year establishing and capitalising the project company, bringing in two new owners: the development funds Africa50 and Stoa Infra & Energie Ltd. First disbursement of funds is expected on 22 January, with notice to proceed with construction likely soon after. The plant is expected to generate 2.9TWh/yr electricity when it starts operating in 2023.

Nachtigal is a somewhat unlikely success story, with Cameroon wracked with insurgency and political uncertainty. However, a highly favourable site with a limited footprint, allowing a highly competitive tariff, and strong backers pushed it over the line. The project was initially developed by Compagnie Camerounaise d'aluminium (Alucam), before Electricité de France (EdF) and the World Bank Group’s International Finance Corporation Infraventures entered the project alongside the government in 2014. Nachtigal is now owned by EDF (40%), IFC (20%), the Cameroonian government (15%), Africa50 (15%) and Stoa (10%).

The IFC will invest €60m in equity and lend €110m to the project and was the global coordinator and lead arranger. Proparco, part of Agence Française de Développement (AFD), is lending €60m to the project, with the AFD providing €90m. Proparco also led financing on behalf of Germany’s DEG, which is lending €35m, and the Netherlands’ FMO, which is lending €30m. The Emerging Africa Infrastructure Fund (EAIF), part of the Private Infrastructure Development Group, is lending €50m to Nachtigal. Other international institutions lending to the project are the African Development Bank, Africa Finance Corporation, CDC Group, the European Iinvestment Bank, and the Opic Fund for International Development. Legal advisors to the lenders were Clifford Chance and Jing & Partners, with JLT Speciality Ltd advising on insurance. EY was the model and tax auditor and Mott MacDonald was the technical advisor.

Nachtigal will comprise a 1,455 metre-long and 13.6 metre-high concrete dam, creating a reservoir covering an area of around 4km2. A consortium of Belgium's NV Besix, French engineering company NGE Contracting and Société Générale des Travaux du Maroc were awarded the engineering, procurement and construction contract for civil works in August 2018. GE Hydro France – formerly part of Alstom – and Elecnor are responsible for electromechanical equipment and Bouygues Energies & Services will build a 50km transmission line connecting the run-of-river project to the Nyoum II substation.


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