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Friday, 12 September 2014

AfDB approves $150 million loan to Lekki Port

Lekki Port, artist impression Lekki Port, artist impression LPLE

The African Development Bank (AfDB) has approved a $150 million senior loan to Lekki Port LFTZ Enterprise (LPLE) for the construction of a greenfield seaport 60km east of Lagos, Nigeria.

LPLE, which is owned by Singapore’s Tolaram Group, holds a 45-year concession to build and operate the Lekki deep water port within the Lagos Free Trade Zone (LFTZ).

The project, estimated at $1.675 billion, will be financed through a 54/46 debt to equity ratio, says the AfDB. It involves the construction of breakwaters and quays, dredging of the basin, and other infrastructure works.

Construction is scheduled to begin in January 2015. The container terminal is expected to start operations in December 2018 with an annual capacity that could eventually reach 2.5 million TEUs. The Lekki port will also feature a liquid bulk terminal (capacity: 16.7 million tonnes) and a dry bulk terminal capable of accommodating Panamax vessels (capacity: 4.5 million tonnes).

Manila-based operator ICTSI, which signed a sub-concession agreement to operate the container terminal for 21 years, will be investing $225 million to provide cargo handling equipment and related IT infrastructure

The AfDB loan was approved on Monday. The Board of Directors was holding its first regular meeting since the Bank returned to its statutory headquarters in Abidjan (Ivory Coast), after 11 year in temporary relocation in Tunis.

Another decision taken during the September 8 meeting was that the AfDB will contribute a $5 million equity investment to the establishment of Kukuza Project Development Company (KPDC), a firm that will focus on early-stage design and preparation of African infrastructure projects.

KPDC will prepare contractual, technical and financial arrangements and market infrastructure projects to potential private and public-private investors. The company expects to process between two and four new infrastructure projects per year.

KPDC’s initial capitalisation is expected to be $25 million with five equity shareholders: the AfDB; India’s Infrastructure Leasing & Financial Services Limited (IL&FS), Exim Bank and State Bank of India (SBI); and Abu Dhabi’s Allied Investment Partners (AIP).


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