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    Cameroon turns to UK’s Savannah Energy to complete 75 MW hydroelectric dam project after four years of stalled progress with China.

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    Cameroon Staff Writer
    Cameroon Staff Writerhttps://www.africanboulevard.com
    The African Boulevard Africain Editorial Team brings you Cameroon news and breaking news headlines in Politics, Economy, Business, Investment and Entertainment. We are unbiased, moved only by the quest for truth.
    Read Time:2 Minute, 47 Second

    Yaoundé, Cameroon- (African Boulevard News) – After four years of stalled progress due to difficulties between Cameroon, the Industrial and Commercial Bank of China (ICBC), and Sinohydro, the British company Savannah Energy PLC has committed to completing the Bini-Warak hydroelectric dam project in the Adamaoua region of Cameroon.

    A protocol agreement was signed between the Cameroonian Ministry of Water and Energy and Savannah Energy on April 20, 2023, to relaunch the hydroelectric dam project that was halted in November 2019. The agreement was signed in the presence of the High Commissioner of Great Britain and Northern Ireland to Cameroon, Christian Dennys McClure.

    The Project and the Players Involved

    The Bini-Warak hydroelectric dam project aims to produce 75 MW of electricity for the northern regions of Cameroon. In July 2016, the Cameroonian government signed a financing agreement with China, under which China would provide $303 million to Cameroon for the construction of the dam. Cameroon was to provide 15% of the total cost of $356 million as counterpart funding.

    Construction of the dam was to be done by the Chinese company Sinohydro, and the funds were to be provided by ICBC. However, after signing the contract in September 2019, work on the project was suspended in November 2019 due to financing problems. ICBC had refused to disburse the funds due to a “cross default” by Cameroon linked to other obligations with the bank.

    The cross-default clause meant that if Cameroon defaulted on one of its debts with ICBC, the bank would automatically default on all other loans outstanding to Cameroon. This clause is meant to protect the lender and allow immediate measures to prevent defaults on other debt obligations.

    Savannah Energy PLC to the Rescue

    Savannah Energy PLC, known for its work in hydrocarbon projects in Nigeria, Niger, Chad, and Cameroon, plans to complete the project as an independent electricity producer. The Cameroonian legislation allows entities to produce and sell energy to electricity distributors or other consumers.

    Savannah Energy plans to finalize the financing mobilization in 2024 for the production of the first megawatt by 2027-2028. With this engagement, the Cameroonian government appears to be breaking ties with China, which initially agreed to finance and construct the 75 MW dam to improve electricity access in the northern region.

    The Future of the Bini-Warak Dam Project

    The signing of the agreement with Savannah Energy PLC is a significant milestone in the development of the Bini-Warak hydroelectric dam project. With the project expected to deliver 75 MW of electricity to the northern regions, the project will help bridge the energy deficit in the region.

    The government of Cameroon hopes that the completion of the project will open up opportunities for industrialization and attract investment to the region. The project is also expected to create job opportunities for the local population.

    Conclusion

    The Bini-Warak hydroelectric dam project in Cameroon has faced several challenges, including financing problems and delays. The agreement with Savannah Energy PLC is a significant breakthrough that will help unlock the project’s potential for the benefit of the region and the country as a whole.

    The Cameroonian government’s decision to break ties with China represents a shift in the country’s foreign policy. With the engagement of Savannah Energy PLC, Cameroon is poised to expand its partnership with other countries to achieve its development goals.

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    Cameroon Staff Writer

    The African Boulevard Africain Editorial Team brings you Cameroon news and breaking news headlines in Politics, Economy, Business, Investment and Entertainment. We are unbiased, moved only by the quest for truth.
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