OREANDA-NEWS. The Arab Republic of Egypt and the European Investment Bank (EIB) signed a loan agreement worth USD 600 million for financing a project in Egypt contributing to a secure sufficient and affordable electricity supply.

In the presence of Egypt’s Prime Minister, H.E. Sherif Ismail and Minister of Electricity and Renewable Energy Eng. Mohamed Shaker, the financing agreements for the Damanhour Power Plant loan were signed in Cairo today by Dr Sahar Nasr Minister of International Cooperation, Mr. Rom?n Escolano, EIB Vice-President, Engineer Gaber Dessouky, Chairman of the Egyptian Electricity Holding Company and Engineer Mohamed Abd El-Baky Abu Senna Chairman of the West Delta Electricity Production Company.

“Developing energy infrastructure is key to promoting growth and employment”, stated Mr Rom?n Escolano during the signing ceremony. He added “the Damanhour Power Plant project is a critical investment and a strategic choice for the country as it will contribute to increasing the electricity supply at competitive cost using modern technology with a low environmental impact”.

The Damanhour Combined Cycle Gas Turbine Power Plant project involves the construction of a Combined Cycle Power Plant with a total installed capacity of 1800 MW in the Nile Delta area of Egypt, some 5 km northwest of Damanhour town. It will strengthen electricity generation capacity to cater for increasing demand with modern and high efficiency units that will partly replace smaller and less efficient production capacity. The project is part of a five-year plan to increase the capacity of the national electricity network of Egypt and is in line with EIB’s External Lending Mandate and the European Union’s Neighbourhood Policy. It will ensure electricity production with significantly lower CO? emissions compared to fossil-fuel based alternatives.

The USD 1.3 billion project is financed by the European Investment Bank (USD 600 million), European Bank for Reconstruction and Development (USD 200 million), Arab Fund for Economic and Social Development (USD 200 million) and West Delta Electricity Production Company’s own funds.

EIB’s lending activities in the Mediterranean region in general and Egypt in particular are based on a Mandate from the European Union – the External Lending Mandate (ELM) currently covering the period 2014/2020 – through which the Bank works together with the EU and the government of Egypt to support socio-economic development in the country.

“In Egypt, and in all the countries where we invest, we are working closely with the national and local authorities to ensure a more sustainable economic future by building stronger infrastructure, promoting business development and addressing persistent economic needs. The Bank is a long-standing partner of Egypt and we will continue providing financial support to the Egyptian Government to respond to the rising needs of the country”, said Mr Escolano.