Globally active Sub-Saharan Africa Projects Newsletter Issue: January 2014· www.roedl.com/it

Summary: How to use the Newsletter

> Angola 1. The newsletter provides information about Sub- > Kenya Saharan Africa projects, taken from different official > Mozambique sources (World Bank, IFC, Afdb, AIB, EU, National > Nigeria Governments, Africa Project Access etc.). > Pan Africa 2. An additional service offers further details on the Project itself. If a subscriber is particularly interested in a specific Project and feels that further information is required, he or she is welcome to contact Rödl & Partner: (tel. +39 049 8046911; fax: +39 049 8046920; e-mail: [email protected]; federi- [email protected]).

3. It should be remembered that Rödl & Partner only provides the initial leads, while, later on, it is up to the subscriber to develop the Project and secure the business.

1 Sub-Saharan Africa Projects

Angola Stage in project cycle: Implementation. Contract details: The northern Kwanza Norte > province may become Angola’s major hydroelectric Rödl & Partner Padova > > complex in the next five years with the Laúca and Cambambe dams, situated along Kwanza River, soon Description & Location: Angola / Chinguar. to be able to generate more than 3000 MW of Subsector: Agricolture. electricity and thus to promote national > Stage in project cycle: Planning. industrialization. Under construction since 2012, the > Contract details: The "Angola Investe" programme is Laúca dam is expected to produce 2,070 MW, while > an initiative of the Angolan Executive allowed in 2013 Kambambe dam, which is being rehabilitated and > for an increase in the production of white potatoes in modernized, will generate 960 MW, thus, totalling a Alfeu Vinevala farm, in Chinguar municipality, central global production of 3,030 MW. The Kambambe dam Bié Province, as well as boosted the sale of this product was built in the 1950s and began undergoing a in other regions of the country. Not only production rehabilitation and modernization process in 2009, with levels increased, but distribution has also been made the aim of increasing its electrical production capacity easier thanks to the resumption of the train service of from 18 MW to 960 MW. the Benguela Railway Company (CFB).

Angola Kenya

Rödl & Partner Padova >Rödl & Partner Padova > Description & Location: Kenya. Description & Location: Angola / Huila Province. Subsector: Energy, Water & Sanitation. Subsector: Health care. > Stage in project cycle: Early Implementation. > Stage in project cycle: Implementation, 80% > Contract details: The Microsol project, aimed at > completed. > developing a single, modular standard technology for > Contract details: The southern Huila province will > producing electricity, drinking water, and heat build 10 hospitals and have more physicians in the simultaneously, has been inaugurated in Kenya by > existing health facilities in the region, under the Schneider Electric. Microsol is based on the principle of municipalisation programme of health services. More cogeneration of electricity and heat and uses the solar hospitals are scheduled to be built in the municipalities thermodynamic technology to benefit micro-industries of Quipungo, Chibia, Cacula, Caluquembe, Jamba, located in rural areas of countries with high levels of Kuvango, Chicomba, Humpata, Chipindo Lubango and sunshine. The focus is on the design of thermal storage Gambos. It was also reported that, in cooperation with that uses only environmentally-friendly products, with the Cuban government and Jean Piajet University, the aim of meeting three basic needs: access to physicians from different specialities will be introduced reliable, efficient, and inexpensive electricity; clean in the various municipalities in order to improve the drinking water; continuous and environmentally sound health situation in the province. Last year medical heat generation. A Microsol solution produces 50 MW practitioners were placed in the hospitals of the h/year of electricity, 1000 m³/year of drinking water, municipalities of Chibia, Matala, Caconda, Gambos and around 800 MW h/year of thermal energy. Kenya and Kuvango, as well as at the new health units. was chosen as pilot country for the industrialization Government aims to ensure greater, more permanent, and commercialization of Microsol as it meets a set of monitoring of the implementation of these services, favourable conditions for the establishment and especially as substantial amounts of the health Ministry development of this technology. The consortium budget is allocated to this segment. Under the same responsible for the project, headed by Schneider programme, the government will build medical posts Electric, plans to start the commercialization phase of and centres to assist the province’s 200 existing health this pilot project in 2015. facilities. Sponsors and Contractors: Schneider Electric.

> Angola Mozambique

Rödl & Partner Padova > >Rödl & Partner Padova Description & Location: Angola / Kwanza Norte. Description & Location: Mozambique / Cabo. Subsector: Hydropower. > Subsector: Tourism. > > > 2 Sub-Saharan Africa Projects Issue: January 2014

Stage in project cycle: Implementation. agreement to buy the 10% stake owned by Videocon Contract details: Gandelli, an Italian company with Industries in the same area, for $ 2.5 billion. > headquarters in Turin specialised in building wooden Value/Level of funding: $ 5.5 billion. > houses, is building 20 tourist accommodation units on Financial and other parties: PTTEP (Thailand). the Quirimbas archipelago, in Mozambique’s Cabo > Delgado province. Ferdinando Gandelli, the CEO of the > company founded in 1912, explained that the wooden Mozambique houses had the advantage of being quick to build and were also cool in tropical climates where temperatures >Rödl & Partner Padova are high all year round. In 2013 the Italian company founded “Gandelli Moçambique”, which is now Description & Location: Mozambique. responsible for building the 20 units and small Subsector: Energy. > reception area at a small tourist resort on the island of Stage in project cycle: Planning. > Medjumbe on the archipelago. Gandelli also told that Contract details: According to Pascoal Bacela, > the company had acquired plots of land to build Mozambique’s national director of electricity at the > houses ahead of Anadarko Petroleum and Italy’s ENI, Ministry of Energy, the country must increase its power beginning commercial natural gas exploration in the generation capacity by 100 MW per year in order to Rovuma basin, also in northern Mozambique. keep up with power demands. The government and Value/Level of funding: Unfinalised. private companies in Mozambique are currently Financial and other parties: Gandelli, Gandelli investing in new electricity generation capacity options, > Moçambique. with developments being made in hydro, coal, and > gas-fired power plants. Mozambique’s rich coal and natural gas reserves are attracting foreign investors and Mozambique a 2013 Reuters poll estimates national economic growth to be around 8% in 2014 and in 2015, up >Rödl & Partner Padova 0.9% compared to the growth rate recorded last year. Major foreign companies investing in Mozambique Description & Location: Mozambique. include Brazilian Vale and Rio Tinto, US oil company Subsector: Oil & Gas. Anadarko, and Italian oil and gas group ENI. > Stage in project cycle: Planning. > Contract details: Thailand’s PTT Exploration and Mozambique > Production (PTTEP) plans to invest $ 5.5 billion in 2014, > most of which in its natural gas exploration project in northern Mozambique, the group said according to >Rödl & Partner Padova financial news agency Reuters. PTTEP is the most important subsidiary of Thai state group PTT and owns Description & Location: Mozambique. 8.5% of the consortium led by US group Anadarko Subsector: Energy, Oil & Gas > Petroleum in the Area 1 block of the Rovuma basin, in Stage in project cycle: Pre Implementation. > Mozambique’s Cabo Delgado province. Last Contract details: Representatives of the Japanese > December, the PTT group signed a promissory contract private sector and of the Mozambican state sector > with Anadarko Petroleum to acquire 1.6 million tons of have signed six cooperation agreements, as part of an liquid natural gas (LNG) per year from the block, which official visit to Mozambique by Japanese Prime Minister is in the same area where other companies are Shinzo Abe. Amongst the agreements, one is involved in oil and gas surveying. According to the concerning the training for engineers in the energy chief executive of PTTEP, Tevin Vongvanich, the sector between Chiyoda Corporation and Mozambican group’s investment plan for 2014 is 60% higher than state company Empresa Nacional de Hidrocarbonetos initially planned, and that most of the investments (ENH); a second one is between Mitsui Corp and ENH would be made in the project in Mozambique. As well to carry out a study on liquid natural gas (LNG). ENH as PTTEP and Anadarko, the consortium responsible for signed a further two memorandums with Mitsui Corp Area 1 of the Rovuma Basin also includes Mozambican and state oil company Petróleos de Moçambique state company Empresa Nacional de Hidrocarbonetos (Petromoc), furthermore signed a project with (ENH) with 15%, BPRL Ventures Mozambique B.V. Marubeni Corp to transform methanol into gasoline. (10%), Videocon Mozambique (10%). In August of last The memorandums of understanding were signed at year Anadarko reduced its stake by selling a 10% share the Mozambique-Japan Investment Forum organised in the block to Indian company ONGC Videsh, which by the Mozambican Investment Promotion Centre (CPI) paid $ 2.64 billion. At the same time the Indian state and the Japanese International Cooperation agency oil company ONGC and Oil India reached an (JICA), the Japanese External Trade Organisation

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(Jetro), Japan Oil, Gas and Metals National Corporation Contract details: Japan plans to provide $ 17.3 and the Confederation of Economic Associations of million to fund construction, in Maputo, of a Mozambique (CTA). Around 30 large Japanese state > combined cycle power plant. The plant is set to form and private companies took part in the forum, along part of the development project of the energy sector with members of the Mozambican government and known as the Maputo Gas Fired Combined Cycle representatives of Mozambican private and public Power Plant. The agreement to fund the project was bodies and representatives of international signed during a visit to Mozambique by Japan’s Prime organisations with offices in Mozambique. Minister, Shinzo Abe. The chairman of state electricity Value/Level of funding: Unfinalised. company, EDM, reported that around 99% of the Financial and other parties: Mozambican Investment electricity that Mozambique produces comes from > Promotion Centre (CPI), Japanese External Trade hydroelectric sources, a risk in a country which > Organisation (Jetro), Japan Oil, Gas and Metals experiences erratic rainfall patterns. The combined National Corporation, Confederation of Economic cycle plant should start operating in 2018, and would Associations of Mozambique, Chiyoda Corporation, provide around one third of the current electricity Empresa Nacional de Hidrocarbonetos (ENH), Mitsui needs of the city of Maputo. Corp, Petróleos de Moçambique (Petromoc), Marubeni Value/Level of funding: $ 17.3 million. Corp. > Nigeria Mozambique >Rödl & Partner Padova >Rödl & Partner Padova Description & Location: Nigeria. Description & Location: Mozambique / Nampula. Subsector: Construction, Social Development. Subsector: Tourism, Transport. > Stage in project cycle: Pre Implementation. > Stage in project cycle: Pre Implementation. > Contract details The federal government announced > Contract details: Around 1 billion meticals, or $ 33 > plans to develop a mortgage finance company along > million, is being invested in the construction of 14 > the lines of the United: States’ Fannie Mae that will help > tourist resorts across Nampula province, said provincial broaden access to home loans in Africa’s most populous governor Cidália Chauque. At the end of last year country. The Nigeria Mortgage Refinance Co. will sell Nampula had 3,510 available beds for tourists, or 297 bonds on capital markets and provide long-term financ- more than in 2012. The northern province of Nampula ing to lenders that will help them extend more home has areas of economic interest such as the Nacala loans, according to an e-mailed statement from the special zone, the districts of Mossuril, Ilha de Mercury PR company, acting for the government. It will Moçambique, Memba and Moma which all attract also have an “oversight function to standardize mort- business people to invest in the tourism sector. gage lending practices”. The company will help extend Chauque praised the investments made by the private maturities for Nigerian home-buyers to as much as 20 sector with a view to improving passenger rail services years, encouraging the building of 75,000 new homes a linking the interior of the country to the coast. The year and creating at least 300,000 jobs, according to governor also noted that the company that manages the statement. Nigeria has been seeking to expand fi- the passenger transport, the Northern Development nancing to help address a housing deficit in the conti- Corridor (CDN), had invested $ 14 million in 12 air nent’s second-biggest economy. The Federal Mortgage conditioned carriages and seven engines. She also said Bank of Nigeria said last month it was in talks with two that the province’s roads now had better conditions for Chinese lenders for credit of as much as $ 6 billion. In vehicles to travel along them. November 2013, the government accepted a $ 300 mil- Value/Level of funding: $ 33 million (construction of lion loan from the World Bank’s housing unit. tourist resorts), $ 14 million (passenger transport). Value/Level of funding: Unfinalised. > Financial and other parties: Nigeria Mortgage, > Mozambique Refinance Co., Federal Mortgage Bank of Nigeria, World > Bank.

Rödl & Partner Padova > Nigeria Description & Location: Mozambique / Maputo. Subsector: Energy. >Rödl & Partner Padova > Stage in project cycle: Pre Implementation. > Description & Location: Nigeria. > > 4 Sub-Saharan Africa Projects Issue: January 2014

Subsector: Energy. the nation’s seaports. This has provided shipping com- Stage in project cycle: Pre Implementation. panies with a high level of efficiency and economy of > Contract details According to the World Bank’s Lead scale that has enhanced quick turnaround time. Habib > Energy Specialist Mr. Erik Fernstrom, the World Bank, in Abdullahi, managing director of the NPA, said that > collaboration with: the Federal Ministry of Environment, port reforms have resulted in competition as there has is working to attract $ 100 million clean technology been an intensified effort by the terminal operators to fund to boost renewable energy in Nigeria. Fernstrom procure cargo handling equipment and upgrade of the said that the fund would be a concessional loan with various terminals. low interest rate targeting a grid connected solar plant (PV) in some states in the country. He said that the fund Nigeria would specifically target a grid connected PV in some northern states where solar resources could be optimally used. Fernstrom advised the Federal Government to in- >Rödl & Partner Padova vest in renewable energy in order to diversify its energy sources. He said that it was a problem for the country to Description & Location: Nigeria. Subsector: Social Development. depend on one source of energy. Fernstrom expressed > optimism that Nigeria could completely have renewable Stage in project cycle: Pre Implementation. > energy in the nearest future with the efforts of the Fed- > Contract details The Nigerian EU has approved a € > eral Government in reforming the power sector. 500 million budget for Nigeria from 2014 to 2020, : Value/Level of funding: $ 100 million (expected). according to its top official for Africa, Dr Nicholas Wescot. Wescot told journalists at a press conference Financial and other parties: Federal Government of that the EU development programme in Nigeria for the > Nigeria, World Bank. > next 7 years would be targeted at poverty reduction, particularly in northern Nigeria. The EU official said the Nigeria fund was approved under the 11th European Union Development Fund (EDF) from 2014 to 2020, and is a reduction of 17.7% compared with the € 677 million Rödl & Partner Padova > appropriated to Nigeria under the 10th EDF from 2008 to 2013. Wescot described Nigeria as a significant : Nigeria. Description & Location development partner to EU, citing strong trade Subsector: Transport. relations. He said the EU and prospective investors from > Stage in project cycle: Implementation. the bloc would target investments in the agriculture > Contract details: Nigerian ports have recorded about sector to provide jobs for the unemployed people in > 115% growth in the volume of inbound cargoes im- Nigeria, particularly in rural areas. Wescot also reiterated > ported into the country through the economic gate- the EU’s commitment to assist Nigeria in addressing its ways (the seaports) in the past 10 years. Nigerian Ports security challenges. On the 2015 elections, he said the Authority findings have shown that aside from Nigeri- EU would assist Nigeria to build robust democratic an-billed cargo, which has grown in recent times due institutions. According to the EU official, he had earlier to the country‘s growing middle class, the nation’s met with Nigeria’s Minister of Trade Olusegun Aganga seaports do not handle transhipment and transit cargo and they held discussions on the EU Economic for neighbouring countries, especially landlocked ones Partnership Agreement (EPA) with West Africa – a sign that the demand for petroleum product, in- countries. He said negotiations on the EPA had made creased gross domestic product (GDP), and the trans- “good progress’’ and described ECOWAS member- formation agenda, which has also resulted in the in- countries‘ commitment to a common external tariff as a “significant step forward.’’ He also used the occasion to crease in construction works done across the country, announce that the EU-Africa summit would be held in has had an unprecedented economic impact on the Brussels in April this year and that the meeting would port industry. Facility upgrades and the acquisition of address the theme “Investing in People, Prosperity and state-of-the-art container handling equipment by the Peace’’. terminal operators, has ensured quick container han- Value/Level of funding: € 500 million. dling operations and reduced cargo dwell time. Also, Financial and other parties: EU. the consistent effort by the NPA in dredging the water > channels and removing of critical wrecks has helped in > growing the volume of imported cargo. The enabling Tanzania environment created by the Federal Government has further helped in building the confidence of investors. >Rödl & Partner Padova In terms of channel management, larger vessels of above 232.33 metres with capacity of 4,500 TEUS re- > Description & Location: Tanzania. quiring draught of 13.5 metres have started visiting

5 Sub-Saharan Africa Projects

> Subsector: Energy, Construction, Social Development. Value/Level of funding: Unfinalised. Stage in project cycle: Implementation. Details: In the final quarter of 2013, Tanzania signed > > contracts worth $ 1.7 billion with Chinese companies Pan Africa > to construct power plants and housing units in the east African country. This marks China’s growing economic >Rödl & Partner Padova presence in Tanzania, which has made big discoveries of natural gas off its southern coast. In October 2013 Description & Location: Nigeria, Ghana, Kenya. the Tanzanian government signed seven agreements Subsector: Construction. with six Chinese companies, in different sectors. > Stage in project cycle: Pre Implementation. Among these is a $ 692.7 million contract awarded to > Contract details: Actis, an international private equity Tebian Electric Apparatus Stock Co. China’s largest > investment firm, says it has a five-year plan to invest in manufacturer of high-voltage transformers, for the > projects including shopping centres, office towers and construction of a 400 kV power transmission line. industrial parks in fast-growing economies such as Ni- China is also financing a $ 1.2 billion 532 km natural geria, Ghana and Kenya. Kevin Teeroovengadum, the gas pipeline from the south east of the country to Dar firm’s director of sub-Saharan Africa real estate unit, es Salaam. Chinese companies are eyeing Tanzania’s said that Actis would lead investment of as much as $ natural gas reserves and are expected to bid for oil and gas blocks in the country. 1.5 billion in African commercial property to meet ris- Value/Level of funding: $ 1.7 billion. ing demand from international companies targeting a growing middle class. African Development Bank’s an- > nual outlook also notes that Africa’s economy, exclud- Pan Africa ing Libya and Somalia, is forecast to expand 5.2% this year amid a rise in oil and mining projects and direct >Rödl & Partner Padova investment from foreign companies. Teeroovengadum points out that Nigeria, the continent’s most populous Description & Location: Africa. country, grew 6.6% in the first quarter of 2013, while Subsector: Construction, Infrastructure, Transport. South Africa, the continent’s biggest economy, ex- > Stage in project cycle: Pre Implementation. panded by an annualised 0.9%. Actis has raised about > Contract details: Africa is embarking on a road- $ 1.4 billion across seven Africa funds since 2003, ac- > building spree. The increasing demand for more, and cording to data compiled by Bloomberg. Michael > better, road ways is largely due to the mining organi- Chu’di Ejekam, Teeroovengadum’s counterpart in Ni- zations, funded to a great extent by China, which have geria, noted that household expenditure within an 8 flooded into the continent over the last decade. There km radius of Ikeja City Mall in Lagos was around $ is also, however, a larger pan-African effort to up- 18,000 per annum per household, adding that with grade and expand the continent's transport network about one million households within this radius, with the aim of improving access to education and household expenditure per annum was about $ 18 bil- healthcare, and enabling commerce. Africa's existing lion. “Actis has already invested the proceeds of an ini- road network is sparse and poorly maintained, with tial $ 155 million real estate fund in malls and office average road density on the continent recorded at 204 buildings in Ghana, Nigeria, Kenya, Botswana and km of road per 1000 km2 of land area – only a quarter Mauritius” Teeroovengadum says. He adds that the of which is paved. In contrast, the world average is company has partnered with Mauritian investment 944 km per 1000 km2 with more than half paved. The company GML to invest in Port Louis-based Indian Programme for Infrastructure Development in Africa, Ocean Real Estate Co. which is developing a $ 1.5 bil- or PIDA, launched in 2010 and funded mainly by Afri- lion town in the island nation. “We have leapfrogged can governments, plus international banks, govern- to shopping centres of 25,000 km2 from existing small ments and funding agencies is due for completion in shops” in Nigeria and Ghana, Teeroovengadum says. 2040 and dedicates 30% of its budget to improving Value/Level of funding: Unfinalised. Africa’s transport networks. The plan is to expand the Financial & Other Parties: Actis, GML. existing, 10,000 km long network of major roads to > between 60,000 and 100,000 km – either by upgrad- > ing existing roads or by building new ones. The result would be nine arteries running along the coastline, or across the continent. Some 250,000 km of smaller roads will be built or upgraded to connect smaller cit- ies to the main arteries, plus another 70,000 km to connect rural areas. PIDA's goal is to boost trade, spark growth and create jobs.

6 Sub-Saharan Africa Projects Issue: January 2014

Contacts

Avv. Eugenio Bettella Dott.ssa Federica Scarso Partner Business Development Manager Tel.: + 39 049 8046911 Tel. + 39 049 8046911 E-Mail: [email protected] E-Mail: [email protected]

Managing Partner of the Firm, is an expert in international Business Development Manager for the Africa Desk, gradu- corporate and commercial law, liquidations, national and ated from the University of Trieste, after studying in Germany international arbitration and general litigation, M&A, privati- and U.S.A. Federica Scarso has a finance qualification from zations and international joint ventures. He assists Italian the Gordon Institute of Business Science of Johannesburg and foreign companies as a specialist in trade and produc- (South Africa). She has gained extensive experience working tion relocation projects in Eastern Europe, Russia, Middle in Africa, from 2003, in the production of Emerging Markets and Far East, Africa and South America. Eugenio Bettella is Country Reports in countries such as Sierra Leone, Nigeria, an expert in commercial and corporate law in Islamic coun- Libya and then in South Africa Argentina and Brazil. In 2007 tries. He is considered a reference point in these areas for she joined Africa Investor, with headquarters in Johannes- many industrialists’ associations in Italy (Confindustrie). He is burg, as Business Development Manager for West Africa a speaker at numerous courses, seminars and conferences (Ghana, Nigeria, Liberia, Sierra Leone) Luso Africa (Mozam- on international law, more broadly on the development of bique, Angola) and Southern Africa (South Africa, Zimba- business in the aforementioned areas. Arbitrator at the bwe, Zambia). Then Federica Scarso developed specific Tunisian-Italian Chamber of Arbitration of Tunis and the expertise in the promotion of investment opportunities in Chamber of Arbitration of the Chamber of Commerce Italy- Africa working with both the private and public sector. At Germany (AHK Italien) which is also the representative for Rödl & Partner she assists Italian companies in investment Eastern Veneto and Friuli Venezia Giulia. projects in Africa (particularly Ghana, Zimbabwe, Angola, Languages: Italian, English and French. Nigeria and Mali) in the areas of infrastructure, agribusiness, oil & gas and mining. She provides support to companies in their start-up phase in Africa, particularly with respect to the development of strategies and feasibility studies in sub- Saharan Africa. Languages: Italian, English, German, Portuguese and Span- . ish.

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Impressum Sub-Saharan Africa Projects January 2014 Disclaimer: The information hereby provided may be confidential and therefore are intended Issue: January 2014 solely for the use of the individual or entity to whom they are addressed. While every effort has been made to ensure the accuracy of the information con- Editing: Avv. Eugenio Bettella, Dott. ssa Federica Scarso tained herein, Rödl & Partner shall not be held responsible for any damage arising Rödl & Partner Padua from the use or interpretation of the information. Via F Rismondo 2/E 35131 Padua Tel.: +39 049. 8046911 | www.roedl.com/it

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