Gas Sector Specialist (International)(925 Views)
About Ministry of Mines and Petroleum
The long lasting conflict in Afghanistan has had a severe impact on the power sector, both directly (dilapidated generation, transmission and distribution infrastructure) and indirectly (serious management issues at the national power utility). In addition, Afghanistan still largely relies on imports from neighboring countries for its power supply, which is not only costly but also raises concerns of the security and reliability of supply. With the help of the donor community, significant efforts have been undertaken by the Government of Afghanistan (GoIRA) to reform and modernize the power sector, by both upgrading and developing infrastructure and by improving overall management of the sector.
As part of efforts to increase availability of power in the country and self-reliance, GoIRA is exploring options to develop domestic generation capacity. In this respect, discussions have been held between GoIRA and various private parties for the development of a gas-to-power plant in Mazar-e-Sharif (estimated 50MW) under an Independent Power Plant (IPP) arrangement, “the Mazar IPP”. The Mazar IPP would be implemented on a direct agreement basis (without a competitive process). It would also represent the first project of its kind in Afghanistan and is, therefore, considered important in terms of precedent setting as it could serve as a model for future transactions of the same nature.
Public parties involved in discussions on the Mazar IPP have so far included the Ministry of Finance (MoF), the Ministry of Energy and Water (MEW), the Ministry of Mines and Petroleum (MoMP), Da Afghanistan Breshan Sherkat (DABS), the national power utility, and Afghan Gas Enterprise (AGE), the state-owned gas facility. Private parties involved include the International Finance Corporation (IFC) and the Ghazanfar Group (GG), a private Afghan conglomerate. A Memorandum of Understanding (MoU) was signed between the parties in connection with the Mazar IPP on May 13, 2015, and the Heads of Terms were signed between the parties on September 22, 2016 to capture key contractual terms
While structuring discussions are still on-going between the parties, the following parameters are expected:
- the Mazar IPP would be established as a corporation in Afghanistan (Project Company) and the plant constructed on private land;
- the gas needed for the plant would be supplied by AGE under a long term gas supply agreement;
- power produced would be purchased by DABS under an off-take agreement (estimated 20 years term).
To ensure the viability of the Mazar IPP, the issuance of several guarantees is also being considered, including to secure the purchase of power by DABS and certain termination payments. Such guarantees could be provided by the World Bank’s International Development Association (IDA). In addition, Political Risk Insurance is being considered to cover political risk for the sponsors, which could be provided by the Multilateral Investment Guarantee Agency (MIGA) . The structure of the Mazar IPP is not yet finalized and the required guarantees will depend upon the structure of the transaction.
It should be noted that similar to the power sector, the gas sector is currently undergoing a restructuring, involving, among others: a proposed corporatization and commercialization of AGE (with the objective of making it a market-oriented profitable company), a review of the sector legal, regulatory and institutional framework (with the objective of establishing a modern and coherent policy framework – including opening the exploration and production stages to private sector operators), a review of price and tariffs issues and the establishment of a regulator.
Given the number and complexity of issues to go ahead with the Mazar IPP, GoIRA has requested assistance from the World Bank, through the Afghanistan Extractives for Development Project (AE4D) implemented by MoMP, to hire a set of individual consultants (spanning both gas and power sector expertise as well as legal, financial and economic expertise) to support project preparation. The consultants are expected to work closely together and with MoMP as well as other public parties, including AGE, MEW, DABS and MoF during the preparation of the Mazar IPP, and with supervision engineers hired to oversee the installation of a new gas pipeline from Sheberghan to Mazar-e-Sharif. It is further expected that the individual consultants will work with a transaction advisory firm, to be hired during the preparation stage, who will provide additional support to GoIRA. The transaction advisory firm will take on responsibilities related to the negotiation and closing of this transaction and will also build capacity of the different public entities involved in the Mazar IPP to undertake additional PPP-type transactions in the future, which are expected to build on the structuring precedents set by the Mazar IPP.
MoMP, via the AE4D project, intends to engage the services of an experienced gas sector specialist to assist in the implementation of this activity as well as a potential further IPP arrangement that is comparable to the Mazar IPP in its key components and pertinent matters (as further detailed below) and that is ready for implementation. These terms of reference seek to invite proposals from consultants qualified and experienced in the preparation of IPPs to provide the services described under the scope of work below.
While the gas sector specialist will be hired by MoMP under AE4D, s/he will need to provide assistance to all Government stakeholders involved in the Mazar IPP and potentially another IPP (MoMP, AGE, MEW, DABS and MoF). A key task of the gas sector specialist will be to reconcile the different views of the various stakeholders and to safeguard the interests of GoIRA.
|Date Posted:||01 Jan 2017||Reference:||MoMP/ AE4D / CS - IC- 04|
|Closing Date:||29 Jan 2017||Work Type:||Unknown/Other|
|Number of Vacancies:||1||Gender:||Any|
|Functional Area:||Mining||Open Ended:||NO|
|Nationality:||Any||Salary Range:||As per company salary scale|
|Contract Type:||Short Term||Years of Experience:||10 Year(s)|
|Contract Duration:||1 Year(s) & 0 Month(s)||Extension Possibility:||No|
Duties and Responsibilities
1. Initial Stage
The structure of the Mazar IPP is still under discussion (as might be the case for a comparable IPP arrangement) – and GoIRA will be required to take positions on a series of technical (including commercial), financial and legal issues, so as to allow for these IPPs to move ahead. In this respect, the gas sector specialist is expected to provide just-in-time assistance on such issues as the GoIRA (i.e. MoMP, AGE, MEW, DABS and MoF) will request. The gas sector specialist may also take the initiative to raise issues that it considers important for GoIRA to address.
Assistance at the initial stage shall focus on the preparation of a technical gas sector due diligence report for the Mazar IPP (and potentially another gas-to-power IPP), which should cover issues such as:
• Assessment of the technical implications of various available design options, including which design options provide the best combined technical and cost option for a gas-to-power project of this type, from the perspective of the gas sector infrastructure requirements;
• Assessment of whether there is enough gas available for a 20 year project (including the required quality and pressure) and assessing the capacity of the gas pipeline to supply the gas to the plant;
• Asset inventory and performance review to understand ability of existing gas infrastructure to deliver required gas to the Mazar IPP throughout the duration of the 20 year contract (as may be the case for a comparable IPP arrangement). This would include review of any planned infrastructure upgrades, and any recommendations/cost projections on additional infrastructure investment required;
• Evaluation of AGE to understand their capacity to implement and manage the project(s), including identification of training needs/gaps, internal governance/operational procedures, etc.
• Define performance milestones and targets, including any technical standards, and structure risk and responsibility allocation;
• Provide cost inputs to support preparation of financial model for the project(s);
• Environment and social issues: the Mazar IPP (and potentially another gas-to-power IPP) will be required to comply with all applicable and relevant social, environmental, public health and safety national laws and requirements. Given the potential participation of IFC and other World Bank entities, the applicable environmental and social Performance Standards (PS) of IFC will apply. Specifically the gas sector specialist will advise GoIRA (and, in particular, the National Environmental Protection Agency, NEPA) on all aspects of social, environmental, public health and safety compliance requirements as they relate to any gas sector infrastructure related to the Project, which could involve: (i) reviewing relevant Terms of Reference for the various environmental and social studies and plans that would be required to comply with all applicable and relevant national laws and PS, (ii) reviewing the environmental and social studies and plans to ensure compliance with national laws and PS, (iii) advising on the Consultations and Disclosure requirements consistent with national law and PS, (iv) reviewing the proposed Grievance Redress Mechanism (GRM), (v) advising on the requisite institutional capacity building needs within DABS to ensure effective supervision and oversight monitoring during construction and operation and (vi) liaising with the World Bank Group team on all aspects of social, environmental, public health and safety issues.
• Review of Heads of Terms. Heads of Terms for the Mazar IPP were signed on September 22, 2016 and similar documents might be signed for a comparable IPP arrangement). While these Heads of Terms are non-binding, they are expected to guide the development of the Project Agreements. The gas sector specialist is expected to review these Heads of Terms to familiarize herself/himself with the proposed contractual positions and obligations, including:
(i) risks to be assumed by each party;
(ii) performance standards to be achieved by the private partner;
(iii) procedures for monitoring compliance with contractual obligations;
(iv) dispute resolution mechanisms;
(v) exit and termination procedures;
(vi) force majeure procedures; and
(vii) payment regimes.
2. Transaction Stage
Once the structure for the Mazar IPP (and potentially another IPP) has been finalized and agreed, a number of agreements will need to be prepared and negotiated among the parties (the Project Agreements). While it is difficult to precisely list the Project Agreements until the final project structure(s) has been agreed upon, possible agreements include: an Energy Conversion Agreement or Power Purchase Agreement (PPA); a Gas Supply Agreement (GSA) , an Implementation Agreement (IA - to include a GoIRA sovereign guarantee along with other GoIRA support), Land Lease Agreement (LLA) and any other direct agreements needed for the project(s), i.e. connection agreement (which maybe be inside the PPA), environmental and/or water use agreement (the mode of operation of an IPP in Afghanistan – as well as any contracts to be concluded with GoIRA for this purpose – will need to be determined). A key task for the gas sector specialist is to support GoIRA to understand the package of agreements it must put in place, depending on the deal structure which is decided, and the technical viability and costing of these agreements.
Assistance at the transaction stage is expected to include:
• Review of Project Agreements: the Project Company will take responsibility for the drafting of the Project Agreements for the Mazar IPP. The gas sector specialist would review draft Project Agreements (both initial drafts and revised versions) from a technical perspective, support GoIRA in reviewing the agreements, and – in close collaboration with the legal advisor (hired at the same time as the gas sector specialist) – provide written comments on the documentation. The review should take into account: (a) regional and international precedents; (b) local situation and its impact on project implementation and investment requirements; and (c) the nature of the Mazar IPP as the first IPP in Afghanistan, which is also expected to serve as a basis for future transactions. Specific support would include:
(i) support in understanding clearly the technical gas sector risks that GoIRA would assume upon entering into the agreements, and the fairness of the proposed risk allocation;
(ii) support GoIRA in its review of proposed technical and commercial terms.
Depending on the progress made during the transaction stage of the Mazar IPP (and potentially another IPP), the gas sector specialist – in cooperation with the transaction advisory firm – may also be expected to support GoIRA in the negotiation of the final Project Agreements, in order to protect the interests of GoIRA and ensure the fairness of the final Project Agreements.
Because the Mazar IPP is still under preparation, with discussions ongoing on its structure, and the selection of an additional IPP(s) has not been made, some level of flexibility is needed in the definition of the responsibilities of the gas sector specialist– as well as for the delivery of services.
As regards the initial preparation phase, the gas sector specialist would be expected, as discussions on the structure advance, to advise the public stakeholders on the main parameters of the proposed transaction(s), from a technical point of view, and prepare a gas sector due diligence report to capture analysis and recommendations, from a technical perspective, on the various structuring options for the Mazar IPP (and potentially another IPP).
As regards the transaction phase for the Mazar IPP, the gas sector specialist would be expected to assist the public stakeholders in reviewing the draft Project Agreements to ensure that: (i) contractual structure and contractual terms are technically viable; and (ii) the interest of the GoIRA and relevant public parties involved are properly assessed, understood and defended. This may include the preparation of opinion documents on specific issues, and written feedback on the draft Project Agreements.
III. SUBMISSION OF DELIVERABLES, TIMELINE, AND PAYMENT SCHEDULE:
The following written deliverables as expected from the gas sector specialist:
• Initial Stage:
a. Gas Sector Technical Due Diligence Report
• Transaction Stage:
a. Written comments on Project Agreement drafts
b. Preparation of opinion reports, as required
c. Preparation of summary document outlining key technical (gas sector) contractual obligations of GoIRA and the private partner
All deliverables are to be provided in English. All deliverables must be in Microsoft Word format (with relevant annexure and tables in excel format where required) and must be delivered to MoMP and the World Bank Task Team Leaders, Fanny Missfeldt-Ringius at firstname.lastname@example.org and Christina Paul at email@example.com. All original text, figures/tables must be delivered in a format which enables modifications. All non-original work must be properly sourced and referenced. The World Bank Group team will engage regularly with the gas sector specialist for completion and submission of the deliverables. The gas sector specialist will be expected to attend all meetings, teleconferences and briefing sessions and respond to other communication promptly for the duration of the Assignment.
• The gas sector specialist is expected to have minimum of a Bachelors/ Master’s Degree in engineering, chemical/petro-chemical, or related discipline. S/he must be fully conversant with all aspects of PPP. S/ It is anticipated that the skills and expertise required for this assignment will include the following:
• At least 10-15 years relevant experience in successfully leading similar assignments related to PPP/IPP structuring and technical design;
• Relevant gas sector expertise, with relevant experience in gas sector due diligence, project finance, gas and power issues (including power/gas sector agreements), and structuring and negotiation of PPP agreements;
• Demonstrated ability to work with government/public sector decision-makers and organizations;
• Strong oral and written communication skills in English language with a capacity to communicate effectively to a wide variety of audiences, including conducting presentations;
• Ability to manage multiple tasks effectively and a strong team player with excellent leadership and interpersonal skills and the ability to work in a high profile environment;
• Experience with working in Afghanistan or in countries where there is no PPP precedent and/or with challenging political and security situations would be strongly preferred;
• Prior experience working with international organization, such as the World Bank Group, would be considered an asset;
• Good analytical skills, and the ability to work through complex technical issues;
• Good negotiation skills.
Afghanistan - Balkh
Afghanistan - Kabul
Bachelors Degree, Mining
Expressions of interest (including CV and three referees) should be sent to the email address below by no later than 15:00 hours (local time) 29 January 2017. Reference MoMP/ AE4D / CS - IC - 04 must be quoted on all correspondence and the Expression of interest.
Ministry of Mines and Petroleum, Program Management Unit (PMU)
Attention: Mr. Abdul Waheed Khalili
Afghanistan Geological Survey Building (AGS), 2nd floor, Annex,
Close to Abdul Haq roundabout, 3rd Macrorayan, Kabul, Afghanistan.
Cell phone Nos.: +93 (0) 789 22 14 42
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