A concession agreement signing ceremony has taken place, marking the commencement of New Bugesera International Airport construction in Bugesera, Eastern province.
The signing was, on behalf of the Republic of Rwanda done by Honourable James Musoni , the minister of Infrasttucture and Mr.Emmanuel Mota, the Chief Executive Officer Monta-Engil on behalf of the developer and the Engineering, Procurement and Constructio (EPC) contractor.
The project is worth USD $700m) to be executed in 4 phases. The first phase is expected to be completed in 2019.The project will be run under Build Operate and Transfer business model(BOT).
The signing comes after the concluded negotiations of a Public Private Partnership (PPP) transaction with Mota-Engil Africa (MEA) and Aviation Travel & Logistics Holding Ltd that was done in September 2016 in connection with the development of the New Bugesera International Airport.
The Project will be constructed under is aBuild, Own, Operate and Transfer (BOT) business model for a twenty five (25) year concession. Further to the signature of the Project Development Agreement (PDA) and the Joint Venture Agreement (JVA) on 1st September 2016, the parties have concluded all the Project Documents as an important milestone towards raising the equity and debt funds required for the Project (“Financial Close”) as well as defining the detailed terms for the operation of the airport during the concession period.
The signed Project Documents are:
a. Concession Agreement: between the Government of Rwanda and the Joint Venture (Bugesera Airport Company as project vehicle);
b. Shareholders Agreement: between Mota-Engil Africa and ATL;
c. Engineering, Procurement and Construction Contract (EPC Contract): between the Bugesera Airport Company and Mota-Engil Africa as the EPC Contractor.
The total cost for the project is $700Million and designed in a way that it will be developed under five phases. The first phase is estimated to take twenty seven (27) months of construction and to cost about USD 400 Million. At starting of operation the airport will be able to accommodate about 1.8 million passengers per annum.
The development of the subsequent phases will be triggered by passenger traffic. According to the current forecast under the Financial Model of the Project, development of the subsequent phases will be triggered by demand targets with internally generated funds of the Project. It is expected that at the end of the concession, the Airport will accommodate at least 6 million passengers per year.
The construction of a new airport is aligned with the Vision 2020 and the EDPRS. The Project will have a high impact on the socio-economic development of Rwanda in general and on the positioning of Rwanda as a regional hub. It will also sustain the development of the aviation sector by providing all necessary facilities to RwandAir as a growing airline and to the development of logistics operations.
The Project will also promote Rwandan businesses opportunities as a catalytic asset for service provision in all aviation activities, including logistics, maintenance of aircrafts, catering services, etc. And above all the Project will provide opportunities to Rwandans with about 2,000 jobs created for locals, since local content is considered as a priority in the agreements.