OPIC financing at work: Tripling energy generating capacity in Togo
Togo, a small country in West Africa, has one of the lowest rates of per capita energy generation in the world. In 2006, the country’s demand for electricity was nearly twice as high as production and the shortage of domestic energy was exacerbated by growing demand for electricity in the rest of West Africa, which reduced the ability of some neighboring countries to export to Togo. In addition, the country’s traditional reliance on imports of hydropower from Cote D’Ivoire and Ghana left its energy supply vulnerable to drought. The country was forced to ration power with daily rolling blackouts. Frequent power outages in 2006 resulted in an estimated $150 million to $190 million in private sector losses, about half of the annual revenue of the government of Togo.
OPIC provided $209 million in loans and political risk insurance to New York-based ContourGlobal to build a 100 MW “tri-fuel” power plant.
The project, the largest energy investment ever made in the Republic of Togo, increased Togo’s electricity capacity, reducing blackouts and diversifying fuel sources. In 2013, the project was also recognized as one of the Top 40 public-private partnerships of recent years by the International Finance Corporation and Infrastructure Journal.
OPIC financing at work: Supporting a small Oklahoma oil producer in Colombia
It’s said that if you build it they will come, but when trying to introduce a promising technology into an emerging market, it’s not always that easy. Joshi Technologies of Tulsa, Oklahoma, learned this when it sought to apply an advanced oil production technology he developed to an aging oil field in Colombia.
“As a small business seeking to do business in Colombia, I knew that no bank in the U.S. would give us a loan,” said Joshi President Sadanand Joshi. His company had successfully produced oil in several small fields in the U.S. as well as Canada and India, but after it invested in the Palagua field in a remote region of northern Colombia, it could not obtain the financing needed to move forward with production.
In 2004, OPIC provided a $3.8 million loan to Joshi which it used to support production at Palagua. At the time, the Palagua field had already produced 110 million barrels of crude oil under the management of a major multinational oil company, and was considered to be near the end of its producing life. However by applying “slanted drilling” technology, a variation of the innovative horizontal drilling technique that Joshi helped develop, Joshi and its local partners were able to increase yields. Since committing the initial loan, OPIC has provided three additional loans to Joshi and the field has produced more than 4,000 barrels per day for the past decade – surpassing its total yield at the time Joshi first became an investor.
“Without OPIC it would not have been possible. We would have had to sell the project,” says Joshi.