Eversheds advises on a $700 Million project to power Mauritania
International law firm Eversheds has worked with the World Bank in advising the Government of Mauritania on entering into an agreement with SNIM and Kinross, to form a project company to build a 350 MW gas-to-power plant in Mauritania.The project, which is estimated to cost around $700 Million, is expected to begin commercial production in 2014.
Eversheds advised the Government of Mauritania on all aspects of the project, including the shareholders agreement, the financing, gas sales agreement and the power purchase agreement . The firm will continue to advise on the Government on the development of all the detailed agreements.
The shareholding structure of the project company is composed of Somelec (the Mauritanian State Electricity Company) - 40%, SNIM - 26% and Kinross AG, an affiliate of Kinross Gold Corporation - 34%. The shareholders will be the main buyers of electricity from the Project Company. The electricity will be used for mining activities, domestic Mauritanian consumption and could eventually be exported to neighbouring countries.
The Project Company has already entered into an agreement to purchase gas from Tullow Oil’s Banda Field (60 Km offshore Mauritania). Tullow Oil has commenced FEED studies for the upstream development and a decision on commerciality is expected in December.
Work on the development of a dual-fuel 120 MW power plant (which will be integrated into the project) and a 225 KV high tension electric power line between Nouakchott and Nouadhibou has already commenced. This will be financed from funds from the Arab Fund for Economic and Social Development and the Islamic Development Bank
The Eversheds team was led by Partner Boris Martor assisted by Counsel Ramu Ramaswamy.
Boris Martor commented:
“It’s a great privilege to work with the World Bank and the Government of Mauritania on such a transformative project that will supply electricity to the people of Mauritania and play a major role in the economic development of the country. Eversheds has extensive experience in working in Africa and undertaking major energy projects and we are very excited to participate in such a prestigious project.”
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