| Project Detail |
Metito Utilities Limited (“MUL” and the “Guarantee Holder”) signed a Concession Agreement for 25 years with the City of Zrenjanin (the “City”) of Serbia on November 9, 2020, to design, construct, own, operate, finance, and maintain the first wastewater treatment plant in the City to treat a mix of domestic sewage and industrial influent with a design capacity up to 25,000 m3/ day (the “Project”). The Concession Agreement was then transferred to BEGEJ WATER d.o.o. Beograd, Serbia (the “Project Enterprise”). The Project cost is estimated at EUR 32 million, to be financed by Equity/Quasi-Equity/Shareholder Loan from MUL and financial debt.
The Project was developed under the framework of the cooperation agreement entered between The Republic of Serbia and the United Arab Emirates (“UAE”) in 2013 to promote private investments in both countries. In furtherance and on the basis of the cooperation agreement between both countries, a Memorandum of Understanding (“MoU”) was entered into between the Ministry for Agriculture, Forestry and Water Management and MUL in 2019 for the development and implementation of water and wastewater treatment projects in Serbia to address the potable water deficit and lack of infrastructure in the area of water and wastewater treatment.
The proposed up to EUR 17.00 million MIGA Guarantee is to cover Equity/Quasi-Equity/Shareholder Loan investment (including the retained earnings and capitalized interest) to be made by MUL into BEGEJ WATER d.o.o. Beograd. The MIGA guarantee is expected to have a tenor up to 20 years, providing coverage against the risks of Breach of Contract, Transfer Restrictions, War and Civil Disturbance, and Expropriation.
The Project will be the first wastewater treatment plant in the City of Zrenjanin and is expected to treat the wastewater of approximately 88,500 residents (73,500 domestic users and 15,000 industrial users) who are connected to the existing sewage pipeline network that extends over 400 km. The Project is expected to address environmental concerns pertaining to the discharge of untreated residential and industrial wastewater in the Begej river, which has been contributing to severe water pollution and as such is expected to help in achieving national goals in environmental protection. |
