Four Egyptian electricity production companies are in negotiations with six banks to borrow $400m to repay Arab and foreign companies that carry out maintenance works at the power plants of all four companies.
Sources at the Egyptian Electricity Holding Company (EEHC) said that West Delta Electricity Production Company, Cairo Electricity Production Company, Middle Delta Electricity Production Company, and East Delta Electricity Production Company are negotiating with Banque Misr, the National Bank of Egypt (NBE), the Arab African International Bank (AAIB), the Commercial International Bank (CIB), QNB ALAHLI, and the Egyptian Gulf Bank (EGBank) to finance their maintenance projects.
The sources said that the companies aim to conclude the deals this month and repay the loans over 11 years with a four-year grace period.
The sources explained that the Ministry of Electricity is set to finish all its maintenance works before the end of May, noting that the ministry will complete maintenance of power plants putting out 30,000MW before the end of April.
The Upper Egypt Electricity Production Company (UEEPC) has signed a contract loan with EGBank for EGP 2bn to finance a maintenance programme and update the stations affiliated with the company.
The sources pointed out that the ministry has developed a plan to renovate the plants to save fuel and increase efficiency, instead of building new plants, which would cost the state huge amounts of money.
The Ministry of Electricity has allocated EGP 33bn over the coming two years to improve and support the electricity grid in order to accommodate the new capacities.
The plan includes supporting the transmission lines with an estimated EGP 18bn, while distribution lines have been allocated EGP 15bn.
During the last cabinet meeting chaired by Prime Minister Sherif Ismail, ministers agreed to grant the EEHC and the Egyptian Electricity Transmission Company (EETC) two loans totalling EGP 37bn.
Chairperson of the EETC, Gamal Abdel Rahim, said that the EETC agreed with the NBE to borrow EGP 18bn to strengthen the national electricity grid. The agreements include facilitated business plans. The interest of the loans will be paid for by the Central Bank of Egypt and the Ministry of Finance. Signing of the deal will take place this month.