US $351M loan granted for Bita mega water project

Angolan government has been issued a US $351M guarantee loan by the Africa Insurance Agency (ACA) for the implementation of the Bita drinking water mega project.

The loan is intended to cover losses in excess of the partial guarantee provided by the World Bank, allowing the project to reach financial close. Bita drinking water project’s objective is to improve access to potable water service in selected areas of Luanda.

The project involves construction of a 260,000 m3 drinking water plant in Bita, a town 40 km from Luanda. The plant will operate through an inlet on the Kwanza River, which flows through the capital Luanda and into the Atlantic Ocean.

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Distribution lines

Plans are also underway to install 82 kilometers of water mains to supply four new distribution lines in the suburban service area south of the capital. The distribution lines include; Cabolombo, Mundial, Ramiros and Bita.

The water project will be developed by a consortium formed by the French group Suez, Mota Engil, a Portuguese construction company and a civil construction company based in Porto, Portugal, Soares da Costa. Upon completion, the Angolan government estimates that the future drinking water supply facilities will benefit 7.5 million people.

The water supply network is also being expanded to supply two existing but under-served distribution centers on the outskirts of Luanda. Additionally, the municipalities of Camama and Benfica will no longer be supplied by tankers.

“This project is essential to Angola’s development objectives, as it will bring a safe and reliable water service. It is also an excellent example of an innovative blended financing solution using World Bank guarantees and ACA insurance, which has reassured the financial markets and helped secure the financing,” said Sebnem Erol Madan, the World Bank’s Practice Manager for Infrastructure Finance, PPP (Public Private Partnership) and Guarantees.