By Chernoh Alpha M. Bah
In mid June 2024, Sierra Leone’s Julius Maada Bio and his cabinet officials held an event in Freetown to launch the construction of a US-funded electricity power plant in Freetown. The $412 million electricity infrastructure project promised to construct a new 126.5-MW Liquified Natural Gas Power Plant in Freetown, Sierra Leone’s capital, and is financed by the US International Development Finance Corporation (DFC) through a debt provided to Milele Energy and its corporate partner, TCQ Power Limited. Officials said the power plant, once constructed, will help address Sierra Leone’s rolling blackouts and expand its national electricity system to accommodate additional renewable energy solutions in the future.
The event to launch the construction project was witnessed by US Ambassador, David Bryan Hunt and DFC’s former deputy chief executive officer, Nisha Biswal. At the launching ceremony, Ambassador Hunt, said the DFC loan will “revolutionize Sierra Leone’s energy landscape” and the impacts “will be profound, fueling progress, prosperity, and a brighter future for all Sierra Leoneans.”
Hunt’s optimistic words echoed those of the DFC and Hunt’s own friends in the Bio regime, as well as the corporate executives of Milele Energy and TCQ Power Limited, the two recipients of the US$412 million DFC loan. A year later, our investigation found no evidence that any such construction of a power plant has even started in Sierra Leone since that June 2024 event.
One year on, Sierra Leoneans are asking: “where is the Freetown power plant and what happened to the US$412 million?”
Few months after the event, US-financed Milele Energy, the majority shareholder on the project, closed operations and sold-out to Osprey Renewables Africa Limited. Then the company’s American executives, Erik Granskog and James Ireland, also exited the company without any explanation.
The energy project, known as the West Area Power Generation Project, was first developed under the auspices of the Ernest Bai Koroma regime some 15 years ago in 2011 after Sierra Leone’s National Power Authority (NPA), the parastatal arm responsible for the generation and supply of electricity since 1982, was dismantled as part of the postwar national privatization program designed by international financial institutions in the early 2000s.
On assuming office in 2007, Ernest Bai Koroma announced that his administration’s primary focus was to completely transform Sierra Leone’s economy through “substantive investment in critical infrastructure, improved social services delivery, and private sector development.”
On paper, Koroma’s poverty reduction strategy (or what he called his Agenda for Change) prioritized four key areas: the provision of reliable power supply across Sierra Leone, increased productivity in agriculture and fisheries, modernized transportation network to facilitate trade and travel, and ensuring sustainable human development. In this list of development priorities, the electrification of Sierra Leone assumed top priority.
A year later in 2008, Sierra Leone’s economic growth rate was projected to be around 6.5% per annum and per capita GDP was less than US$350, meaning that the majority of Sierra Leoneans lived on less than US$1 per day, according to World Bank and International Monetary Fund (IMF) statistics.
In 2011, Sierra Leonean politicians enacted a new electricity legislation that created two parallel institutions: the Electricity Generation and Transmission Company (EGTC) and the Electricity Distribution and Supply Authority (EDSA) to replace the state-owned NPA. Of interest, by 2016, international financial institutions ranked Sierra Leone 178 out of 189 countries with the least access to electricity.
Development agencies stated that weak oversight of the electricity sector was responsible for the poor ranking, and they suggested that dismantling NPA and privatizing electricity supply would enhance electricity transmission and distribution capacity in the country.
However, the dismantling of NPA and the privatization of electricity supply in Sierra Leone has not resolved the country’s perennial electricity crisis but has further worsened access to electricity and fueled corruption.
Conceptualized as a solution to Freetown’s electricity crisis, the West Area Power Generation Project was first awarded to the Zambian-based Copperbelt Energy Corporation Africa (CECA) in 2016 on a 20-year power purchase agreement that included the construction of a 57 MW thermal power plant in the Kissy Dockyard of east Freetown. The power purchase agreement also authorized CEC Africa to generate and sell electricity to Sierra Leone’s Electricity Distribution and Supply Authority (EDSA) for onward distribution to Freetown residents.
The West Area Power Generation Project was jointly owned by CEC Africa Investments Ltd (50.1%) and Tempus Constant Qualitas (TCQ) Power Ltd (49.9%). Together, CECA and TCQ Power created a subsidiary company in Freetown called CECA Sierra Leone Generation Limited as the project’s executing company. In 2016, CECA and TCQ Power shared their power purchase and investment agreements with the World Bank Group and other development finance institutions who agreed to provide multilateral debt financing for the project. The Commonwealth Development Corporation (CDC), for instance, provided a US$22 million loan to CECA Sierra Leone for the Western Area Power Generation Project.
The international loan package also included a US$40 million guarantee from the International Development Assistance (IDA), an additional US$60 million from the Multilateral Investment Guarantee Agency (MIGA), and US$30 million A-Loan from the International Finance Corporation (IFC), with an interest rate swap of US$3 million, all given to CECA SL Generation Limited.
In October 2016, the IFC announced that it was acting as lead arranger and interest rate swap provider to help mobilize additional loans for the project from other development finance institutions that included the African Development Bank, CDC Group, the Emerging Africa Infrastructure Fund (EAIF), and the Dutch Development Bank (FMO).
“This debt financing package will support an independent power generation facility in an industrial zone about 4km outside of Freetown. The project covers the development, construction, and operation of a 57-megawatt heavy oil fuel-fired power plant,” the IFC noted in a press statement on 24 October 2016.
Back in 2016, TCQ’s Chief Executive Officer, Karim Nasser was enthusiastic that they had overcome the “incredibly challenging task of developing the first independent power project” in post-war Sierra Leone.
“With the support of IFC and other lenders we move ever closer to realizing our objective and paving the way for further independent power generation in Sierra Leone,” Karim Nasser said in October 2016, adding, “IFC has been a leader in structuring a commercially viable project and helping us mobilize support from other lenders.”
Thus, the project’s documents and the financial agreements all promised that construction and operation of the power plant was to be completed within four years; a time frame that would have coincided with the end of the second term of the Koroma regime in 2018. The 20-year power purchase agreement provided that electricity generated by the power plant would be sold to EDSA for onward resale and distribution to resident customers in Freetown and the larger western area.
Two years later, on 7 March 2018, Sierra Leone’s former president Koroma, accompanied by international finance representatives and foreign diplomats, organized an event in Freetown to launch the start of construction at the power plant’s proposed site in Kissy, east of Freetown. The attendance list included representatives of the World Bank Group, the CDC, TCQ Power, the African Development Bank, and the former British High Commissioner to Sierra Leone, Guy Warrington.
At the event, TCQ Power’s Karim Nasser again said the ceremony had brought them “closer to delivering more electricity to the people of Sierra Leone.” His project counterpart, Paul Hanrahan, the CEO of Globeleq, representing Britain’s financial stake in the project, expressed similar excitement.
“We are very excited at the opportunity to participate with CDC and TCQ in Sierra Leone,” Hanrahan said, adding that the project “provides Globeleq an opportunity to develop relationships with key decision makers and enables us to support the energy sector and build more generation in the country.”
Notwithstanding these glowing statements, it turned out the event only celebrated a ghost project; no real construction was taking place in the Kissy Dockyard area and although millions of dollars in debt financing agreements had been signed, the Western Area Power Generation Project remained a development idea on paper only. Apparently, officials of the Koroma regime and their foreign counterparts privatized the country’s electricity infrastructure, exploited Freetown’s desire for electricity, and went ahead to accumulate huge multilateral debts that were never utilized for the stipulated purpose.
When he assumed office in 2018, Maada Bio instituted several Commissions of Inquiry into Ernest Koroma’s administration, especially the Koroma regime’s handling of the Sierra Leone economy.
The investigation discovered, among other things, that the Western Area Power Generation Project was one of the “ghost infrastructure and service-related projects” used by the Koroma administration to accumulate unexplained wealth during the APC’s tenure in office.
The staggering discoveries involved many of the top-ranking cabinet officials of the APC regime and several of Koroma’s friends within the diplomatic community in Freetown. The damning discoveries led to transnational conversations and negotiations involving US diplomats, international banking officials, and regional politicians in West Africa.
One such crucial transnational meeting, held in Lebanon in early September 2020, was disguised as a purported “medical visit” by Julius Maada Bio. The Lebanon meeting, details of which are still tightly kept among officials and diplomats, was the climax in Bio’s effort to reverse and reclaim control over several of the energy deals that Koroma had signed off to various British and other multinational corporations during his ten years in office.
Our investigation discovered that Maada Bio used Sierra Leone’s Anti-Corruption Commission (ACC) to seize investment interests and shares Koroma and his foreign corporate allies owned in the Western Area Power Generation Project. The renegotiated energy deal gave US-financed Milele Energy 50.1% ownership of the project.
The 20-year power purchase agreement with Milele Energy was signed in violation of Sierra Leone’s finance and anti-corruption laws. Similarly, the agreement also violated US laws governing DFC’s investment abroad. For one, no competitive bidding rules and public tender processes were followed in awarding Milele Energy a stake in the Western Area Power Generation Project. A former senior official in Sierra Leone’s energy ministry told Africanist Press that Maada Bio “just handed the project to Milele Energy without following any of the transparency and finance laws of Sierra Leone.”
An audit exercise into the transactions relating to the Lebanon visit, including the renegotiated energy agreements, resulted in the arranged unconstitutional sacking of Sierra Leone’s two most senior auditors, Lara Taylor-Pearce and Tamba Momoh, from the country’s national auditing agency in September 2021.
Back in July 2021, Sierra Leoneans were promised that MIlele Energy and TCQ Power will complete the construction of the power plant by “the fourth quarter of 2024.” July 2021, the United States International Development Finance Corporation (DFC) loaned US$217 million to the Maada Bio regime through Milele Energy and TCQ Power to finance the construction of a “new power plant in Freetown” on a 20-year power purchase agreement.
In the four years that followed, DFC’s loans for the construction of the said power plant increased from US$217 million in July 2021 to over US$412 million by June 2024. Yet, what was described as the “biggest private sector energy project in Sierra Leone” turned out to be a “ghost project.”
Four years later, the said power plant has still not been constructed. Our investigation found no evidence that any such construction of a power plant has even started in Sierra Leone.
Milele Energy, the majority shareholder on the project, has since closed operations and sold-out to Osprey Renewables Africa Limited in October 2024. The American executives, Erik Granskog and James Ireland, who received the DFC loans to build the power plant in Sierra Leone, also exited the company without any explanation.
Like the Koroma era operation, the Maada Bio group, has similarly used the same electricity project to accumulate hundreds of millions in multilateral loans from various multilateral agencies, including the DFC, for energy production and electricity distribution, none of which has been realized to date in Sierra Leone.