Private Equity Eyes Nigerian Power Project (Update)
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Privately-backed Themis, a power company based in Morocco, announced March 18 a partnership with Nigerian Kingline Development to develop a $600mn, 550-MW gas-fired power plant in Ondo State, Nigeria. Themis said it would be one of the lowest-cost gas-to-power facilities internationally, when it comes on stream.
The country has a poor electricity supply history, with frequent power cuts. A major oil producer, it also flares some of its associated gas. Themis told NGW that the gas will be procured on a competitive basis from third-party producers.
Its target is to reach financial close by Q2 2020 and become fully operational in 2022. Themis told NGW that the offtake agreement has progressed well and will be finalised prior to financial close.
It will be built next to the existing Omotosho Power Plant. Project pricing is underpinned by a signed engineering, procurement an construction contract with an international contractor so far unnamed but who has successfully delivered over 4 GW of gas-fired power plants in Africa, Themis said.
Themis said the project has attracted "significant interest from multilateral and private institutions in arranging project debt, while the project equity requirements can be fully funded by the existing partners, with Denham Capital being the majority shareholder." Denham Capital is also the backer of Themis.
The plant is expected to generate about 4.5 TWh/yr of affordable energy through a highly competitive, cost-reflective tariff structure, which is expected to have a positive impact on the cost of electricity in Nigeria, delivering long-term value and affordability for energy consumers.
Themis will support back-office functions post financial close while Denham Capital will retain majority equity in the project, which will have "an experienced, independent power plant operator," Themis told NGW.
Neo Themis CEO Tas Anvaripour said that Themis’ involvement in the project has "played a fundamental role in laying the foundations for what can become the lowest cost-per-MW thermal plant in Nigeria. Kingline offers compelling advantages for the federal government of Nigeria given its extremely competitive pricing, availability of peripheral gas and transmission infrastructure, timing to operation, and technical flexibility.”
Neo Themis is the Moroccan company established in March 2018 by the Themis management team in connection with its partnership with Denham Capital. Neo Themis focuses on investments in power generation projects in Africa under an exclusive management services contract with Denham.
Kingline CEO Sean King added: “We are excited to be working with Themis, who bring critical expertise and extensive power development experience, as well as proven access to financial markets. The project has strong technical and financial support and will deliver a power solution for Nigeria, cost-competitive within any international market."