Endeavour Energy, an Africa-focused independent power company owned by the investment firm Denham Capital, has made a $32m equity investment in Tè Power Company S.A.S.U., to construct a 50MW thermal power plant in Conakry, the capital city of Guinea. 

The support for the project comes alongside additional loan capital of $50m from the the Overseas Private Investment Corporation (OPIC) and a $39m million loan investment from the CDC, the UK’s development finance institution.

Sean T. Long, CEO, Endeavor Energy said: “Guinea has made great strides over recent years to strengthen its power sector whilst at the same time creating an environment for international investing. Alongside Endeavor’s equity investment, CDC worked seamlessly with OPIC to provide the debt financing for the project.” 

The investment will provide much needed baseload power to a country which experiences regular power cuts and where only 28% of the population have access to electricity.

The Tè Power project is Guinea’s first independent power project meeting international standards and the first individual investment in the country by CDC. 

The electricity generated by Tè Power will be sold to the Government of Guinea under a five-year Power Purchase Agreement. 

The project, which is expected to be fully operational in mid-2019, offers the Guinean people power in the medium-term, whilst they wait for large hydropower resources to comes online in around 5 years’ time.

Despite impressive recent economic growth, Guinea is one of the poorest countries in Africa with average annual per capita GDP of ~US$500, placing it at 193rd/203 in the World Bank list. 

It has vast and under-developed hydropower resources but currently only around 400MW of installed grid capacity, dropping to as low as 150MW of reliable power. 

Just over a quarter of the population of 12.4 million have access to electricity. 

According to the World Enterprise Surveys, 84% of business in Guinea experience electrical outages, suffering four electrical outages a month, resulting in an aggregate loss of 5% of annual sales.

The support of CDC and OPIC has helped the project reach financial close, and will ensure international best practice in environmental and social standards.

Iain Macaulay, CDC’s Head of Project Finance, said: “We are proud to be financing this ground-breaking project, which will provide reliable power, local jobs and support broader economic development. Having a privately funded power project designed to deliver international environmental and social standards sends a strong signal that Guinea is open to the international investing community. CDC played a valuable role in the project by providing the debt finance that commercial banks were unwilling to offer.”

“Endeavor Energy and the sponsor group have done excellent work with the government to get the regulations and procedures governing power projects to the required standard. By providing Guinea with essential baseload power whilst large hydro power capacity is being built, we believe the project aligns perfectly with the government’s long-term power strategy,” he added.