Mali - Power Water Project : Credit 1282 - Project Agreement - 2 - Conformed

FOR IMMEDIATE 1tKE, World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.* Telephone: (202) 477-1234 IDA NEWS RELEASE NO. 83/5 Contact: Pushpa Schwartz July 8, 1982 (202) 477-5306 MALI TO RECEIVE IDA CREDIT FOR POWER AND WATER SUPPLY EXPANSION The Bamako area of Mali will have a more reliable power and water supply as a result of the technical assistance and expansion of facilities to be provided to Energie du Mali by the International Development Association (IDA). An SDR 20.4 million ($24 million) credit from the World Bank's affiliate for concessionary lending will help finance the efforts of the Malian public utility to improve its managerial and technical capability and to provide an expanded and reliable service to consumers, primarily in urban areas. A large part of the $43.2 million project will be for technical assistance. A team of managers and technical experts will be provided to Energie du Mali to advise the organization's management and take part in the utility's operation. They will also provide on-the-job training for Malian staff. Other consultants will carry out studies of the power and water supply systems for the medium and the long term and provide engineering services. Power expansion includes the construction of a 2 megawatt biomass power plant at Mopti/Sevare and rehabilitation of the Dar Salam power plant in Bamako. The power network will also be extended to 10 new sections of Bamako, accommodating about 5,000 potential customers. A novel feature of the project's power component is the biomass power scheme which will use low-heat value gas and gas oil produced from burning rice husks. This relative-y new technology will mean decreased costs, as the only alternative would have been a diesel-based power plant. A study is underway to resolve problems that may be caused by the quality of rice husks used. The installation of a water distribution network and pumping equipment will relieve the major bottlenecks in production facilities in Bamako. About 60,000 people will gain access to safer and less expensive water, and about 150,000 current customers will benefit from the improved water service. The IDA '-redit is for 50 years, including 10 years of grace. It carries no interest but bears an annual commitment charge of 0.5% on the undisbursed balances of the credit and a service charge of 0.75% on the disbursed balances. The OPEC Fund will finance the $6.4 million biomass power scheme. Co-financing from the two French aid agencies, joint owners of Energie du Mali together with the Malian government, represents about 50% of the technical assistance component and the rehabilitation of the Dar Salam power plant: Caisse Centrale de Cooperation Economique is providing a $6 million credit, while the Fonds d'Aide et de Cooperation is contributing a grant of $4.8 million. The credit will be committed when funds are available. NOTE: IDA credits are denominated in SDRs (Special Drawing Rights), which are valued on the basis of a "basket" of currencies. The U.S. dollar equivalent of the SDR amount of the IDA credidt reflects the exchange rates existing at the time of negotiation of the credit.