Zahrani & Selaata IPP Projects Lebanon Investment in Infrastructure Conference | March 6th, 2018

Table of contents Policy Paper for Electricity IPP Key Objectives and Perceived Benefits Feasibility Studies: Main Preliminary Analysis Findings IPP Transaction Advisory Services Road Map

1- The Policy Paper for Electricity (2010) Increase generation capacity by 1,500 MW followed by an expansion of 1,000 MW using the IPP modality structure. Fuel sourcing is to be based on diversity and security where 2/3 of the fuel mix is based on natural gas while selecting technologies that work on both natural gas and fuel oil. Gradually restructuring and increasing the existing tariff to eliminate the financial deficit in the electricity sector and establish a balanced budget for EDL. Endorsement of legislation for the new power plants encouraging Public Private Partnership.

2- IPP Key Objectives Develop a World Class Regulatory Framework Develop a Strategic Model Replicable For Future Developments Attract the Optimum number of Foreign Investors Delivery of Power By 2022 Acceptable Tariff and the Lowest Cost of Electricity Minimize Environmental Impact

IPP Perceived Benefits Amortization of Capital Expenditures Achieving Competitive Cost of New Capacity Minimizing Impact on Government Balance Sheet Predictable Timing and Faster Execution Establishment of New Performance Benchmarks

3- Feasibility Studies: The IPP Sites

Capacity Distribution and Footprint Requirements for Each Site

Feasibility Studies: The IPP Sites Detailed Studies shall be done for: Soil Investigation Geotechnical Investigation Topographical Survey Bathymetric Survey Submarine Topography Water Circulation Study Thermal Recirculation Study Environmental and Social Impact Assessment

Feasibility Studies: Fuel Sourcing

Feasibility Studies: Fuel Sourcing

Feasibility Studies: Generation Technology The selected generation technology is: Combined Cycled Gas Turbine (CCGT) Capacity ( 500 MW to 600 MW) NG as a Primary Fuel and HFO as a secondary fuel with DO being a back-up fuel

Feasibility Studies: Grid Connectivity The Zahrani site has an existing 220 kV GIS with spare capacity, calculated to be 510 MW which is immediately available. From a grid tie-in perspective, Zahrani extension site possess high potential for a direct deployment of the IPP. Another positive attribute is that the Zahrani GIS is connected with the Aramoun substation which is capable to feed the main load centre of Beirut. Selaata is one of the sites that currently have no access to HV transmission lines. The master plan has considered a 220 kV substation with evacuation capacity of 450 MW to be connected to Halate substation by a double circuit lines 24 km south of Selaata site. The substation is also expected to be connected to the 66 kV network.

4- IPP Transaction Advisory Services Develop a robust transaction structure to attract qualified private sector partners for the implementation of each of the Projects. Phase (1) entails conducting a legal, technical and commercial due diligence to assess the best options available to structure the partnership between the public and private entities. Phase (2) would begin including marketing the Project(s) to investors, prequalification of candidates, preparation of tender documentation and assistance to the authorities in the negotiation as well as evaluation and selection of the winning bidder.

IPP Transaction Advisory Services

IPP Bid Documents

IPP: Procurement

5- IPP Road Map ( 18 – 24 Months)

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