Tunisia - Third Power Project : Loan 2003 - Press Release - Conformed

FOR IMMEDIATE RELEASE World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.* Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 81/104 May 28, 1981 WORLD BANK TO SUPPORT THIRD POWER PROJECT IN TUNISIA The World Bank announced today the approval of a $41.5 million loan to Tunisia for a third power project, which will help the country to carry out the first three years of a five-year rural electrification program and to rehabilitate its urban distribution systems. The project will connect about 990 villages in 15 governorates to the national network and improve the quality of service to urban customers in about 60 urban centers. Funds from the World Bank loan will finance the foreign exchange cost of the purchase and erection of about 3,130 kilometers (km) of medium tension lines and about 2,840 km of low tension lines for rural electrification and urban distribution; the purchase and installation of about 1,290 trans- formers in rural and urban areas for a total capacity of 62 MVA; and the provision of equipment and tools to enable the Soci6t6 Tunisienne de l'Electricitg et du Gaz (STEG) to carry out the rehabilitation of the urban distribution system. Technical assistance for a study of the distribution system in Tunis and fellowships for overseas training of STEG personnel are also included. Upon completion, the project will extend electricity services to about 30,400 new domestic rural customers, 2,100 pumping stations, and 300 commercial and small industrial consumers. The quality of service to more than 150,000 existing urban consumers will also be improved. In addition to carrying out the least-cost program for rural electrification, the project will improve the operating efficiency of STEG, and will follow up previous World Bank-assisted efforts at rationalizing energy pricing policies. The World Bank loan to the Republic of Tunisia has a term of 17 years, including four years of grace, and bears interest at 9.6% per annum. NOTE: Money figures are expressed in U.S. dollar equivalents. FORM NO. 1121 (5-76) TEC.H N I CAL DATA PROJECT: Third Power COUNTRY: Tunisia TOTAL COST: $89.6 million BANK FINANCING: $41.5 million, for 17 years, including 4 years of grace, with interest at 9.6% per annum OTHER FINANCING: Socift' Tunisienne de l'Electricite et du Gaz, $15.2 million Government of Tunisia, $28.2 million Customers' contributions, $4.7 million IMPLEMENTING ORGANIZATION: Socl6t Tunisienne de l'Electricit& et du Gaz (STEG) 38, Rue Kemal Ataturk Tunis, Tunisia Cable: GAZELEC-TUNIS Telex: 13060 TUNIS PROJECT DESCRIPTION: The project consists of: (i) supply and erection of about 3,130 kilometers (km) of medium tension, and 2,840 km of low tension lines; (ii) supply and installation of about 1,290 transformers for a total capacity of 62 MVA; (iii) provision of equipment and toold for implementing the urban rehabilitation component; and (iv) provision of technical assistance for training, and a study for strengthening the power distribution system in Tunis. PROCUREMENT: Contracts for,the supply of equipment and materials will be awarded on the basis of international competitive bidding (ICB) in accordance with Bank guidelines. Limited international tendering, based on quotations from suppliers from three different countries, will be permitted for minor quantities of distribution equipment and materials testing equipment and tools not exceeding $700,000 in total. A preference margin of 15% of the c.i.f. price of imported goods, or the customs duty, whichever is lower, will be extended to local manufacturers in ICB comparisons. Installation, erection,and the associated civil works for the rural component will be awarded to local contractors on the basis of locally advertised competitive bidding, while those for the urban component will be undertaken by STEG. CONSULTANTS: About 50 man-months of consultant services will be required for a study of the distribution system in Tunis to determine least-cost development, quality improvement and reduction of system losses; a total of 130 man-months of fellowships for STEG staff are also to be provided, for overseas training. ECONOMIC RATE OF RETURN: 11.6% ESTIMAT7D COMPLETION DATE: 1986 -0-