Tuesday, May 28, 2024

IDB Invest contributes to energy security in Belize by financing the National Gas Company Limited

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IDB Invest, member of IDB Group, provided a US$6 million loan to National Gas Company (Belize) for the construction, operation, and maintenance of a Liquefied Petroleum Gas (LPG) marine terminal, the first of its kind in the country of Belize. The terminal is situated in the southern region of Belize, at the Port in Big Creek, and will have 18 product tanks and a blending tank. The National Gas Company started its operations in May 2020.

A gas cylinder or tank is a pressure vessel for storage and containment of gases at above atmospheric pressure.

The terminal and storage facility will be capable of receiving LPG products directly from the US Gulf Coast and, when coupled with the strategically located inland distribution depots, will bring LPG to no more than an hour away from all major urban centers in the country of Belize. The facilities include equipment and technology to unload Marine LPG carriers, truck loading skids with state-of-the-art shut off and safety technology, a product blending skid, a high-tech control room, office facilities and other complementary infrastructure, all meeting the latest industry standards.

The National Gas Company (Belize) Limited is operating under a build-own-operate-transfer agreement with the Government of Belize and will operate the terminal and facilities for 15 years, at which point it will be fully transferred to the Government of Belize.

LPG is one of the least expensive forms of energy available to Belizeans, hence the need for stable supply, transparent pricing and verifiable quality is of critical importance for energy security and economic growth for the country. Through this energy infrastructure, Belize can access world markets for LPG directly, thereby mitigating the detrimental effects of climate change from road transportation, which was previously its only LPG importation option.

In addition to energy security and climate change mitigation, the transparency of pricing and certainty of quality will create a more competitive retail environment that will ultimately benefit the Belizean consumer and the Belizean economy. Cost of the debt financing is also reflected in the price buildup of the LPG and therefore a cost-effective long-term financing strategy is necessary for an expensive and critical national asset for the country of Belize.

LPG, is a mix of propane and butane, is a fundamental necessity in Belize as 83 percent of households use it for cooking, agro-industry uses it for important grain drying, and for many Belizeans it is an affordable means of fuel for vehicular transportation. Before the country of Belize completed this important national milestone, 93 percent of the LPG it was consuming was being brought in through Guatemala from ports in other neighboring Central American countries.

The operation potentially contributes to five of the United Nations Sustainable Development Goals: Affordable and Clean Energy (SDG 7), Decent Work and Economic Growth (SDG 8), Reduced Inequalities (SDG 10), Responsible Consumption and Production (SDG 12), and Partnerships for the Goals (SDG 17).

About IDB Invest
IDB Invest, a member of the IDB Group, is a multilateral development bank committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector. IDB Invest finances sustainable companies and projects to achieve financial results and maximize economic, social and environmental development in the region. With a portfolio of $13.1 billion in asset management and 385 clients in 25 countries, IDB Invest provides innovative financial solutions and advisory services that meet the needs of its clients in a variety of industries.

About National Gas Company (Belize) Limited
The National Gas Company (Belize) Limited (NGC) is a public-private partnership (PPP) with the Government of Belize (GOB) established to design, finance, build, own, and operate a Liquefied Petroleum Gas (LPG) terminal and two regional wholesale depots. For the first 15 years of the project the GOB will hold 25 percent of NGC and thereafter 100 percent ownership of the facilities will be transferred to the GOB.

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