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Indian power giant achieves financial closure for 134MW South African wind project

Tata Power successfully reaches financial close for Amakhala wind farm in South Africa’s Eastern Cape

The wind projects will be located in the Eastern Cape of South Africa

India's largest integrated power utility has achieved financial closure for a 134MW wind project in South Africa. Tata Power has announced the successful financial close of its Amakhala Emoyeni Wind Farm project through its South African joint venture company with Exxaro, Cennergi.

Tata Power was selected as the 'preferred bidder' for Amakhala and the 95MW Tsitsikamma wind farm project by the Department of Energy, Government of South Africa in 2012.

Cennergi have successfully tied up the entire debt requirement through a consortium of lenders, namely Standard Bank and International Finance Corporation with Standard Bank acting as the mandated lead arranger. The signing of financing agreements was completed in May. The project financing comprises of equity of Rand 789m and Rand term loans of 3156m.

Anil Sardana, chairman Cennergi and managing director, Tata Power, said: "The signing of the financing agreements is a significant milestone for the project and we take this opportunity to thank our investors who have once again shown faith in Tata Power."

Tata Power's other 95MW Tsitsikamma Community Wind Farm is also expected to achieve financial closure in a week. The wind projects will be located in the Eastern Cape of South Africa and are expected to achieve commercial operations in 2016.

Tata Power is another BRIC company to become heavily involved in renewable energy developments in South Africa this year. Earlier this month, China's Yingli Green Energy signed a contract to supply its PV modules to a 180 hectare PV solar plant in the South Africa's Northern Cape.

Cennergi is a 50:50 joint venture between South Africa's Exxaro Resources and Tata Power, which was set up in March 2012. Cennergi, based in South Africa, focuses on the investigation of feasibility, development, ownership, operation, maintenance, acquisition, and management of electricity generation projects in South Africa, Botswana, and Namibia. The initial project pipeline focuses on renewable energy projects in Southern Africa and Cennergi's strategy is to create a balanced portfolio of generation assets.