March 21 (SeeNews) - The European Bank for Reconstruction and Development (EBRD) said it is considering providing a loan to the water utility company servicing Bulgaria's Smolyan city, in order to partially finance a 39.1 million euro ($44.5 million) project for infrastructure upgrades.
The loan which the EBRD is considering to provide to Smolyan Water Supply and Sanitation Company amounts to 4.1 million euro, of which 1.5 million euro will be funded with EBRD's ordinary capital resources and 2.6 million euro will be European Structural and Investment Funds (ESIF) contributions from the EBRD-EU Special Fund, the EBRD said in a project summary description.
The proceeds of the loan will co-finance the construction of new and the rehabilitation of existing water and wastewater infrastructure, jointly with investment grants from the EU Operational Programme Environment 2014-2020.
The EBRD financing of 1.5 million euro will be extended at market terms, whereas the ESIF tranche will be provided at concessional terms, which will make it possible for the company to service the loan, the EBRD noted.
The total project costs will be majority-financed with EU investment grants and co-financed with the proceeds of the loan.
Smolyan Water Supply and Sanitation Company is a regional state-owned utility that provides waste supply and wastewater services to 10 municipalities on the territory of the Smolyan region, in southern Bulgaria.
($ = 0.8781 euro)