Government, Electricity of France (EDF) and Energy of Cameroon signed a sales agreement in Yaounde yesterday.

The government of Cameroon through the Minister of Water Resources and Energy, Basile Atangana Kouna and Electricity of France, EDF, representated by the Group’s Senior Executive Vice President, Simone Rossi, have signed a purchase agreement with Energy of Cameroon, Eneo S.A with its General Manager, Joel Nana Kontchou, sitting. The sales agreement allows the exclusive rights of Eneo to buy energy from the Nachtigal plant on the River Sanaga.

The Final Term Sheet between the Republic of Cameroon, Nachtigal Consortium, and Eneo Cameroon SA signed in Yaounde, yesterday, November 3, 2015, hinges on the contractual structure of the project and the different contracts to be signed between the members of the consortium and Eneo (notably the Power Purchase Agreement-PPA).

It spells out the conditions of connection of the future power plant to the transmission network, to be operated by SONATREL at the commissioning of the power plant by 2021. However, the management of the reservoir dams and water on the Sanaga catchment area will be done by another entity than Eneo. This is in keeping with the December 14, 2011 law on the electricity sector.

Minister Atangana Kouna revealed that the project is well advanced, with construction work expected to begin by mid 2016. He said 10 companies were preselected on October 11, 2015. The tender to identify by beginning 2016 the company to construct the power plant is underway. The Minister announced that the calendar of activity was ready. Minister Atangana Kouna, Simone Rossi and Joel Nana Kontchou said the 420 megawats plant will solve 20 per cent of the energy needs of the country.

The 1 billion Euro (about FCFA 655.9 billion) project is located 60 km from the north of Yaounde, an area of high electricity consumption, said Simone Rossi. A 50 km transmission line is expected to connect the main grid in Yaounde, from where interconnected lines will transport energy to the rest of the country.

He pledged his company’s commitment to complete negotiations of the power sales agreement whose terms are already being laid out. “We just need to finalise the terms of the agreement,” the French expert said, adding that his company has been tasked to secure the licence to build and operate the facility.

Going by a joint agreement between government and its partners for the development of the Nachtigal plant, the Electricity of France is supposed to provide 40 per cent of funding for the project, with the International Finance Corporation of the World Bank and Cameroon contributing 34 per cent and 26 per cent respectively.