Kounoune 67.5 MW Power Station
K&M served as the Lead and Financial Transaction Advisor to the Senegal electric utility (Senelec). On behalf of Senelec, K&M structured and tendered the 67.5 MW Kounoune diesel power plant as a Build-Own-Operate (BOO) transaction. K&M assessed the project’s regulatory environment, size requirements, technology configuration, site layout, fuel supply and water needs, and other technical operating requirements. Following the feasibility work, K&M prepared all project contracts and bidding documents for the Request for Proposals, including the PPA, fuel supply agreement, and Implementation Agreement. K&M also assessed the project’s commercial risks and developed the project financial model to be used in the bidding process. After issuing the RFP, K&M managed the competitive bidding process and performed all of the bid evaluations. K&M selected the winning bidder and led negotiations on behalf of Senelec through to financial close. The project reached financial close with the African Development Bank (AfDB), International Finance Corporation (IFC), West African Development Bank (BOAD), PROPARCO, and CBAO in July 2006 for a total of €48 million (US$61 million).
K&M served as the Lender’s Engineer to the Islamic Development Bank (ISDB) to perform technical and commercial due diligence of a proposed 115 MW coal-fired greenfield power plant in Senegal under a Build-Own-Operate structure. The IsDB was considering a non-recourse project finance loan to the project. K&M reviewed all technical aspects of the plant’s design, site layout, fuel supply arrangement, technology, capacity, environmental and social impacts, and O&M arrangements. K&M also performed a complete commercial due diligence of the project, including a review of the power purchase agreement, engineering, procurement and construction contract, and operations agreement. K&M conducted detailed financial analysis to assess the project’s commercial viability, the adequacy of contractual liquidated damages, and the soundness of the project’s financial structure. K&M made recommendations to the senior lenders regarding the project’s financial structure, construction contingency, contractual arrangements, and total technical feasibility.
The Korea Electric Power Company (KEPCO) engaged K&M to provide technical and commercial advice for the development of a 250 MW coal-fired power plant in Senegal. K&M performed a comprehensive review of the Power Purchase Agreement which included evaluating contract provisions for construction, operations and maintenance, fuel supply, purchase and sale of energy and capacity, design vulnerabilities, and the suitability of the tariff structure. K&M also reviewed assumptions in the plant’s financial projections. In assessing the suitability and reasonableness of the plant’s tariff structure, K&M also analyzed electricity tariffs for similar thermal power plants in Senegal, Morocco, and Chile, and for the Ruzizi III Hydropower plant in Rwanda/DRC/Burundi. K&M modeled the tariffs of these comparable plants against the tariff of the Sendou II plant to assess the cost-competitiveness of the Sendou II plant under different operating scenarios.