Presentation By : Hussein Iman Chief Investment Officer

1. MOZ2013 MAPUTO Presentation By : Hussein Iman Chief Investment Officer South Africa Regional Resource Center African Development Bank

2. Who We are • AfDB is the Pan-African Multilateral Development Bank • Infrastructure Finance, Private Sector Development, and Regional Integration are institutional top priorities • AfDB leverages its AAA balance sheet to support the economic development in its regional member countries • AfDB has consistently been a major financier to the Extractive Industry & Energy Sector in Africa

3. AfDB has 2 lending windows: Public and Private AfDB’s lending operations Public window Governments or state owned enterprises Sovereign Concessionary terms • Private window • Privately owned enterprises - “Financially strong” government owned enterprises • Non sovereign • Commercial terms Recipient Guarantee Financial terms

4. Upstream – Upstream gas infrastructure, Upstream production for Indigenous entrepreneurs (oil/gas) Midstream – Gas Processing Plants, Pipelines (oil/gas), Storage (oil/gas) Downstream – Refineries, Petrochemical/Fertilizer Plants, LNG Plants The AfDB finances projects in Oil &Gas & Coal Sectors to promote availability of cleaner energy resources and promote local value addition 4

5. What the ADB is doing in the Mining Sector • Increase the impact of Mining Sector in RMCs’ Social and Economic development • Build infrastructure support with highly integrated networks (Power, roads, railways and ports) • Monitoring and Enforcing Environmental compliance • Act as a : • Financier and invest our financial resources to pursue economic development goals ahead of profit • Advisor and leverage our knowledge of sustainable development practices • Partner and help mobilise our public and private sector counterparts in solving development issues

6. Lessons Learnt from the Bank’s intervention in the extractive sector financing • Local participation in is key to maximizing benefits from the sector (public or private) • Role of Development Financial Institutions – (Advisory, financiers including infrastructure & monitoring ) • Local content development - SME business linkages • Work force development - Education • Enabling business environment - Legal and Regulatory framework- African Legal Support Facility • Strong Institutions – key to the realization of project benefits ( Environment, Finance, Mining & Mineral, Education etc.,)

7. Senior Debt – tenor and currency adapted to project needs; debt arranging capacity: African Financing Partnership– DFI co-financing platform A-B Syndication Program– leveraging the AfDB Preferred Creditor Status Guarantees – partial risk, partial credit Subordinated Debt Equity – direct, or indirect (equity funds) Technical Assistance The AfDB selects its financial instruments to meet investee company’s needs 7

8. Policy Level– foster policy design, promulgation & implementation Legal and Regulatory framework- African Legal Support Facility Technical Assistance for capacity building Specific Local content programs- SME linkages programs, LOC to financial institutions The AfDB strongly supports Local Content Development 8

9. A public-private partnership between the GOSA, GOM and Sasol Examples of selected projects SASOL natural gas project • South Africa - Mozambique • Investment ZAR 8.5 bn • ADB loan ZAR 550 mn • ADB roles • Long term debt • Reduced cost of PRI • Benefits • Reduction of air pollution • Jobs • Social benefits • Regional integration • Capacity • 856 KM • 122 -183(MGJ/a) per annum

10. Kenmare Resources – World Class Asset Moma Titanium Minerals Mine in Mozambique • One of the world’s largest known titanium minerals deposits with >200 mt of contained ilmenite • Phase Iapprox capacity:-800 ktpa ilmenite, 50 ktpa zircon, 14 ktpa rutile ~7% OF GLOBAL FEEDSTOCK SUPPLY • Phase II approx. capacity: -1.2 mtpa ilmenite, 75 ktpa zircon, 21 ktpa rutile ~10% OF GLOBAL FEEDSTOCK SUPPLY

11. the Mozambique natural gas project, on stream 2004 • US$1,2bn project comprised: • Pande and Temane field development; • Central Process Facility (CPF) construction; and • 26-inch Temane to Secunda 865km pipeline • Equity in upstream:Sasol 70% (Operator), CMH 25%, IFC 5% • Equity in pipeline company:Sasol Gas 50% (Operator), CMG (25%), iGAS (25%) • Currently produces ~300 MMscf/d • A pioneering project in partnership between Sasol and the Mozambique and South African governments

12. Examples of selected projects Nigeria Liquefied Natural Gas Project • Nigeria • Investment USD 2.1 bn • ADB loan USD 100 mn • ADB roles • Political risk mitigation • Complementary financing • Advisor to local banks • Benefits • Reduce gas flaring • adds value to a natural resource • Jobs • Social benefits • Capacity • Additional processing capacity of 1.334 mscfd

13. Examples of selected projects HASDRUBAL OIL AND GAS FIELD DEVELOPMENT PROJECT • Tunisia • Investment USD 1.3 bn • ADB loan USD 150 mn • ADB roles • Corporate Loan • Financier during difficult time • Advisor • ESMS • Benefits • Import substitution • Revenues to Government • foreign exchange earnings • Infrastructure development • Capacity • 150 MCF/day • Onshore gas processing 16,000 b/d of oil equivalent During the financial crisis, the Bank played a countercyclical role

14. Examples of selected projects EGYPTIAN REFINERY COMPANY PROJECT • Egypt • Investment USD 3.5 bn • ADB • Senior Loan USD 200 mn • Sub Loan USD 25 mn • ADB roles • Financier during difficult time • ESMS • Benefits • Import substitution • Revenues to Government • foreign exchange earnings • Infrastructure development • Capacity • 152,500 barrels/day During the financial crisis, the Bank played a countercyclical role

15. Thank you Hussein IMAN h.iman@afdb.org