RABAI POWER. February 24, 2010

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1 RABAI POWER

2 Aldwych Power developer in Africa Founded in 2004 by management and FMO Current shareholders: PAIDF, FMO, EAIF and management Shareholder in CEC, shareholder/manager Kelvin Largest shareholder in Rabai which was recognized by both Project Finance International and Project Finance Magazine as Africa Power Deal of the Year Developer of the Ruhudji Hydropower Project in Tanzania Investor in Wind East Africa the developer of the Singida Wind Project in Tanzania Potential leading investor for the Lake Turkana Wind Farm

3 Location The Project is a 90MW Fuel Oil fired power plant located at Rabai, 20 km inland from the port of Mombasa. The site is adjacent to the KPLC high voltage substation. Rabai Location

4 Recent Photograph

5 This time last year First the engines, then the hall, February 2009

6 General Project Information The Rabai Project consists of the development, financing, construction and operation and maintenance of a 90 MW Heavy Fuel Oil ( HFO ) fired power plant (base load). Conversion from HFO to natural gas once it becomes available. - Location: close to Mombasa, Kenya - Construction works started on October 8 th, 2008 and the contractual start of commercial operation is April 10 th, Sponsors:Consortium consisting of Aldwych and the Danish Burmeister & Wain Scandinavian Contractors ( BWSC, 100% Mitsui & Co.) Structure: - IPP structure (SPV) - 20-year Power Purchase Agreement with KPLC on a take-or-pay basis

7 Sector and Customer Information-Sector Overview Ministry of Energy Policy Licence Policy Direction Recommend Licence Issue Energy Regulatory Commission Ken Gen Imports KPLC Retail Customers IPPs Enforce Licence Requirements PPA & Bulk Tariff Approval Retail Tariff Approval Customer Complaints R E G U L A T I O N

8 Project Contractual Structure Lenders Financing Agreements Government of Kenya Government of Kenya Letter Rabai O&M Co. Operations and Maintenance Agreement KPLC Power Purchase Agreement, Direct Agreement & Sub Lease Fuel Supplier Fuel Supply Agreement Rabai Power Ltd. Aldwych Const. Kenya Construction Period Management Agreement BWSC EPC Contract (onshore and offshore) a Spare Parts & Technical Services Agt.

9 Financing characteristics Total Project Cost: EUR 112mln (including EUR 4.2m of contingencies, corresponding to 6% EPC-contract value) Equity: EUR 27mln Shareholder structure: -Aldwych (34.5%) -BWSC (25.5%) -FMO (20%) -IFU (20%) Debt: EUR 85mln (EUR 79mln secured senior loan; EUR 6mln as mezzanine loan) Lender Group: FMO, DEG, EAIF, FMO, Proparco and EFP Involvement FMO: Equity (Investment amount EUR 5.3m, valued at cost) Senior Loan (EUR 19.75m)

10 Development Impact and role DFIs/FMO Financial-economic aspects: improve the state of power supply (accessibility, reliability) in Kenya by generating electricity for the Mombasa and Nairobi regions, being the economic and financial centres of the country - high spin-off effects to the local economy and export sector E&S aspects: FMO is in the E&S lead (close monitoring, guaranteeing the compliance with the IFC PS)

11 In Summary -Reasons for Success Clear transparent process Built on a platform of a reformed energy sector New Electricity Act enabling private sector participation An independent pro-investment Energy Regulatory Commission A cost reflective tariff A track record; success breeds success Use of standard documentation reflecting risk allocation designed to facilitate project financing Clear decisive leadership within the Energy Sector Co-operation and full involvement of officials from the Attorney General s Office and the Ministry of Finance Development Finance Institutions being somewhat less affected by the banking crisis