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Deutsche Bank, HSBC, KfW arrange 3.5b euros for Egypt Power
[BERLIN] Deutsche Bank AG, HSBC Plc and German development bank KfW IPEX jointly structured and arranged underwriting finance to build the world's biggest gas and steam turbine power plants in Egypt.
The three lenders coordinated finance from 17 international banks for 3.5 billion euros (S$5.24 billion) for three Siemens AG- built turbines that will deliver 14.4 gigawatt of power when complete, boosting Egypt's generation capacity by 50 per cent, said Frankfurt-based IPEX in an e-mail.
The project will cost 6 billion euros in all when completed in 2018. It was sealed in a memorandum of understanding between the German and Egyptian governments last year, reflecting the drive of both administrations to sustain close political and economic ties through regime changes in Egypt.
President Abdel Fattah el-Sisi visited Berlin last year, two years after a meeting with his predecessor, Mohamed Morsi, who is now incarcerated in Egypt.
German economy and energy minister Sigmar Gabriel is due to visit Egypt on April 18 with a group of delegates that include Siemens executives and solar industry officials. Mr El-Sisi last year said he plans to add 4.3 gigawatts of solar and wind capacity by 2018.
Mr Gabriel will on the same trip call in on Morocco, where KfW is co-financing construction of a 580 megawatt solar park in Ouarzazate and a 160 megawatt park in Noor.
Siemens will build turbines at three sites for the Egyptian Electricity Holding Co. They're called Beni Suf, Burullus and New Capital, with each unit generating 4.8 gigawatts, IPEX said.
The transaction banks split jobs to facilitate finance, with Deutsche Bank acting as book-running coordinator. IPEX as Hermes arranged export guarantees. Deutsche Bank will coordinate social and environmental controls for the Ben Sufi and Burullus sites, while HSBC will act as environment coordinator for the New Capital turbine.