Media statement - 30 May 2011
Monday, 30 May 2011: Eskom has reached a further milestone in securing finance for its new build programme with the approval by the board of the Export Import Bank of the United States (Ex-Im Bank) of an $805.6 million loan (approximately R5.7 billion).
The Ex-Im Bank financing is to support Eskom’s purchase for its Kusile power station project, of engineering and construction management services from Black & Veatch International, a specialised project management and engineering firm which is based in Overland Park, Kansas. Black & Veatch will retain highly-skilled senior engineers and support staff in the US to work on the Kusile project over the next five years.
Kusile, near Emalahleni in Mpumalanga, is the second of the two large new coal-fired power stations which Eskom is building to meet South Africa's energy needs. The first unit of Kusile is due to come on line late in 2014 and the power station will have a total capacity of 4 800 MW.
The Ex-Im Bank loan, details of which still have to be negotiated, will add to the R31 billion in export credit agency backed finance which Eskom has already raised. Export credit agency finance is one of the sources Eskom is tapping as part of its R300 billion funding plan for the new build programme. More than three quarters of that funding has now been secured.
Ex-Im Bank is an independent US federal agency which provides financing for US exports of goods and services.
“We are pleased with the decision by the Ex-Im Bank board to approve financing which will help to build Eskom’s Kusile power station. This is a statement of confidence by the US agency in Eskom, and in South Africa and an acknowledgement of the criticality of clean coal in Eskom's fleet. It will support the building of the capacity we need in order to keep the lights on and improve the quality of life for all South Africans,” said Eskom’s Finance Director Paul O’Flaherty.