Unique Meghnaghat Power Ltd (UMPL) has recently achieved financial close for $463 million long-term project financing from foreign lenders on December 13, and got the first disbursement of $360 million on December 18 last year.
UMPL has constructed a 584MW combined cycle gas fired power plant project at Sonargaon, Narayanganj, Bangladesh. UMPL is a consortium of Strategic Finance Ltd (SFL), Unique Hotels & Resorts PLC (UHRL) and Nebras Power Investment Management BV (Nebras Power).
The construction and commissioning of the Project has already been completed and the project is ready for commercial operation, reads a press release.
The estimated project cost is $612 million, which is being financed at 75:25 debt-equity ratio. 24 per cent of this equity has been invested by Nebras Power as Foreign Direct Investment (FDI).
The debt portion is being financed through multi-sourced financing package including an ECA covered tranche from Standard Chartered Bank (SCB) with cover from Swiss Export Risk Insurance (SERV) as well as three DFI tranches, from Asian Infrastructure Investment Bank (AIIB), Deutsche Investitions-und Entwicklungsgesellschaft (DEG) and OPEC Fund for International Development (OFID).
Out of $360 million first disbursement, the SCB as ECA backed lenders disbursed $240.24 million and AIIB, DEG & OFID as DFI lenders disbursed $119.76 million.
This is the largest IPP project financing and private infrastructure project financing to have closed in the past few years in Bangladesh.
This is particularly remarkable given this has been achieved amid stressed FX situation in Bangladesh and financial volatility in the global market due to post Covid pandemic recovery and global political turmoil.
Chowdhury Nafeez Sarafat, managing director of UMPL, said this financing manifests the confidence of lead global Development Financing Institutions (DFIs) and Banks on the economic development of Bangladesh.
Financing closing of $463 million foreign loan has opened the avenue for the future investment in Bangladesh for the similar set of foreign lenders.
He also said the UMPL has implemented the Project with the most efficient gas turbine in South Asia i.e., GE 9HA which has the highest efficiency of more than 62 per cent at site condition.
In the time of scarcity of natural gas, the commercial operation of this project will ensure the optimum utilisation of gas. This financing will make this project a world-class infrastructure project, providing cleaner, reliable, and affordable electricity to the people of Bangladesh.
Anupam Hayat, chief financial officer of UMPL, said, “We are very happy to announce the financial close of $463 million foreign loan and disbursement of the first tranche.
“Given the Covid-19 and Russia-Ukraine war impacts, it was very challenging to achieve the Financial Close. I would like to thank lenders, sponsors, regulators, management team and all the advisors for their cooperation for achieving the Financial Close during these difficult times.”
