1. Gunnar Muent Brussels, 24th June 2011
EIB Financing of Distribution Infrastructure for Gas-fuelled Transport EU-RUSSIA ENERGY DIALOGUE
Gunnar Muent
Brussels, 24th June 2011

2. European Investment Bank - background
The European Investment Bank is the European Union‘s long-term financing institution. The Bank acts as an autonomous body set up to finance capital investments furthering European integration by promoting EU policies.
EIB was created by the Treaty of Rome in 1958
EIB is a not-for-profit, policy driven institution
EIB is 100% owned by the 27 EU member states
EIB has subscribed capital of EUR bn as of 2009
EIB is AAA/Aaa rated by rating agencies
EIB funds itself on the capital markets: EUR 79.4 bn in 2009
EIB signed loans amounting to EUR 79.1bn in 2009
EIB is the largest multilateral financing institution

3. European Investment Bank - objectives
Within the European Union
Cohesion and convergence
Small and medium-sized enterprises (SMEs)
Environmental sustainability
Knowledge Economy
Trans-European Networks (TENs)
Sustainable, competitive and secure energy
Outside of the European Union
Private sector development
Infrastructure development
Security of energy supply
Support for EU presence in Asia and Latin America via Foreign Direct Investment (FDI)
Under EU Mandates
Pre-accession
European Neighborhood
Development

4. Projects financed by the Bank must be: economically justified
Criteria
Projects financed by the Bank must be:
economically justified
technically viable
financially self-supporting and
environmentally sound
appropriate procurement procedures are required (International Competitive Bidding when appropriate)
Projects financed by the Bank must be:
economically justified
technically viable
financially self-supporting and
environmentally sound
Appropriate procurement procedures are required (International Competitive Bidding when appropriate)

5. EIB and EIF Financing Lifecycle Approach1
Risk Capital 2
CIP Resources (SME) 3
RSFF (SME / MidCap) 4
Investment Loans
Facility: High Growth Innovative SME Scheme (GIF), Ecotech
Purpose: IP financing, technology transfer, seed financing, investment readiness
Target Group: VC Funds, Business Angels
EIF Product: Fund-of-Funds
CIP Guarantee schemes
Growth financing for SMEs
Formal VC Funds, CLOs
SME guarantees (loans, microcredit, equity/mezzanine, securitisation
RSFF
RDI financing
SMEs/MidCaps, Banks, PE Investors (sub-investment grade)
Loans (incl. Mezzanine), Funded Risk Sharing Facilities with Banks (Investors)
Investment Loans
RDI financing
MidCaps/Large Corporates/Public Sector Entities (investment grade)
Loans, Guarantees
Bank Loans and Guarantees
Formal VC Funds
Seed/Early Stage VC Funds
Business Angels
Entrepreneur, friends, family
Later Stage
Counterparts
Seed / Start-Up Phase
Emerging Growth Phase
Development Phase

6. Medium- and long term loans
EIB products
Medium- and long term loans
Direct loans of EUR m; larger amounts are possible
Intermediated loans: For smaller projects, indirect lending through credit lines to local financial intermediaries (sub-loans of between EUR 0.1 and EUR 12.5m)
Equity for infrastructure funds under the EPF (up to EUR 150m)
Readiness of cooperation with other financial institutions as financial intermediaries as guarantors, as partner in project identification and as financial arrangers
The EIB’s core product are medium- and long term loans, corresponding to the technical and economical life of the projects. Especially for the financing of infrastructure projects the terms offered by the EIB by very far exceed what the market can offer.
The EIB can also invest into the Equity of infrastructure funds under the EPF (up to EUR 150 M)
Typical direct loans are in the order of EUR million; larger amounts are possible
For smaller projects, the EIB normally lends indirectly through credit facilities granted to local financial intermediaries (sub-loans of between EUR 0.1 and EUR 12.5 million)
The EIB is extensively cooperating with other financial institutions as financial intermediaries (credit lines), as guarantors, as partner in project identification and as financial arrangers.

7. EIB Activities Outside the Union
Supporting EU development and cooperation policies in Partner Countries
EIB external mandates:
Pre-accession countries:
Candidate countries - Croatia, Turkey and Former Yugoslavia, Republic of Macedonia
Potential candidate countries - Western Balkans
European Neighbourhood:
Mediterranean Neighbourhood (FEMIP)
Eastern Europe, Southern Caucasus, Russia
Development:
Africa, Pacific and Caribbean (ACP)
South Africa
Asia and Latin America (ALA)
ACP is a developmental mandate, whilst SA and ALA are mandates for the EIB to support Foreign Direct Investment and projects with mutual benefits for the EU.
I will come to the Bank‘s activities in the Eastern Neigbourhood and Partner countries.

8. Operations under appraisal and awaiting signature: EUR 2bn
Prospects for lending in Eastern Partners
Amount of Mandates
Eastern Neighbourhood Mandate: EUR 3.7bn
Eastern Partner Facility: EUR 1.5bn
Signed so far: EUR 1 bn
Operations under appraisal and awaiting signature: EUR 2bn
Strategy: Fully absorb Mandates within their period of validity
Focus on:
economic infrastructures
environment
Access to EU markets
Strengthening physical links with the Union and FDI
I would like to draw your attention to the fact that the validity period of the present mandates ends in 2013.
Total amounts available are EUR 3.7 bn under the Eastern partner’s mandate and EUR 1.5bn under the Eastern Partners’ Facility
So far about EUR 1bn have been signed.
Operations under appraisal and awaiting signature amount to about EUR 2 bn
Strategy for consists in :
Stepping up the implementation of the External Lending Mandate and to jump start the use of the EPF to support the EU’s cooperation policy with its Eastern Partners.
Focusing investment projects that will help modernise economic infrastructures, improve the environment and promote the integration with the EU economy, including through better physical linkages and FDI.

9. Sectors and beneficiaries Eligible sectors: Energy Environment
Transport
Telecommunication
Industry
Beneficiaries:
State / Central Government
Regions
Municipalities
Utilities
Private companies
Project Finance Structures
PPPs
This slide summarizes the sectors the EIB can finance under the mandates as well the kind of borrowers and promoters it can support.

10. Low/Sub Investment Grade
RSFF - A new Source of Risk Capital
Banks
EIB RSFF funds complement other sources of debt capital available for low/sub investment grade RDI intensive corporates
EIB RSFF funds are highly attractive for potential beneficiaries because of:
Highly attractive terms & conditions (AAA rating and non-for-profit pricing)
Long maturities of up to 10 years or more
Direct EIB participation of up to EUR 300m per transaction (depending on rating)
Strong technology/industry expertise
EIB does not sell assets on the secondary market (buy and hold strategy)
No cross selling (just long-term lender)
Signalling Effect: EIB as a quality stamp
Debt and Mezzanine Debt Product
Investors
Final Beneficiaries
Low/Sub Investment Grade
EIB (RSFF)
EUR 1bn
Approx. EUR 10bn
Debt Financing
Own Resources

11. Examples of what can be financed – LNG terminals
Sagunto LNG plant - TEN
Grain LNG Terminal – TEN
Fluxys LNG Terminal – TEN
Offshore LNG Toscana
Gate LNG Terminal …
EIB lending volume since 2000: EUR 3.6 bn

12. Examples of what can be financed – passenger cars
CNG fuelled engine development:
Major European OEMs
Suppliers
EIB lending volume: > EUR 200 m per year

13. Examples of what can be financed – marine engines
RDI for LNG fuelled marine engines:
Financing of investments of major European OEMs
Suppliers
EIB lending volume: > EUR 100 m per year

14. Examples of what can be financed - ships
Purchase of LNG fuelled ships:
first operations under appraisal …

15. Examples of what can be financed – LNG/CNG
first operations under appraisal

16. EIB lending to investments in LNG/CNG technologies - track record
What can be financed ?
Infrastructure
Acquisition of vehicles/ships
RDI for Systems/Components
Eligible investment costs
Capex
Opex & capex for R&D
Capex & opex for innovation
Eligibilities:
Trans European Networks – TENs
Protection of the Environment & Sustainable Communities
Knowledge Economy – RDI
Convergence

17. THANK YOU !!
Gunnar Muent
Head of Innovation & Competitiveness Department
European Investment Bank