IFC, a member of the World Bank Group, has arranged a US$375 million financing package for a leading private Iraqi power company, Mass Global Energy Sulimaniya. The project will provide electricity to millions of people across the country—particularly in the Kurdistan Region of Iraq, where a migrant crisis has strained power infrastructure.
The debt and equity package includes US$250 million from IFC’s own account and US$125 million from Bank Audi, which includes IFC’s first Islamic syndicated loan. Mass Global Energy Sulimaniya will use the funds to add 500 megawatts of capacity to a 1,000-megawatt power plant in the Kurdistan Region of Iraq—providing power to 3 million people—and to help complete a new power plant near Baghdad that will supply about half of the Iraqi capital’s electricity needs.
The financing package is part of a larger effort by IFC to support infrastructure development in Iraq, which needs to increase its power generating capacity by an estimated 70 percent just to meet current demand.
IFC CEO Philippe Le Houérou, said:
“These investments are critically important in a country where years of war and neglect have hobbled the energy infrastructure, leading to daily blackouts and stifling economic growth.Pressure is especially acute in the Kurdistan Region of Iraq as a result of a recent influx of more than 1 million internally displaced Iraqis and 250,000 Syrian refugees. We expect this project will open the door to greater private sector investment in Iraq, enhance the potential for long-term development, and demonstrate how private solutions can help solve infrastructure gaps in challenging regions.”
Nechervan Idris Barzani, Prime Minister of the Kurdistan Region of Iraq, said:
“The current power shortages not only affect the lives of our people but also cripple business productivity, which negatively impacts the economy and employment. This IFC-led transaction will help increase our power capacity and also provide much-needed liquidity for the country."
Chairman of Mass Global Energy Sulimaniya Chairman Ahmed Ismail said:
“In challenging markets, we appreciate organizations like IFC stepping up to invest in a critical sector like power. Increasing power generation in Iraq is vital at the present time, and our partnership with IFC and Bank Audi will help us achieve our goal of adding 500 megawatts to the national grid."
Raymond Audi, Chairman of Bank Audi said:
“This is the first major investment in Iraq for Bank Audi. We are pleased to show our support for such an important and vital infrastructure project. We look forward to further collaborating with Mass Global and IFC as well as expanding in Iraq. "