The European Investment Bank is providing a USD 73 million(1) loan to Consorcio Mexi-Gas for a gas distribution network in the Mexico City urban area. Mexi-Gas is a joint venture gas distribution company owned 86% by Gaz de France and 14% by Bufete Industrial, a Mexican construction company.
Mexi-Gas will build and operate a natural gas distribution grid in the Valley of Cuautitlan-Texcoco. The project aims at expanding the distribution network from the actual 370-km to 3100 km in year 2004 as well as to improve the technical standard and the operational safety of the existing grid. The natural gas will help to reduce polluting emissions in densely populated areas by replacing LPG, fuel oil and gasoil.
The loan is provided in the context of the EU co-operation policy with third countries. In Asia and Latin America (ALA), the EIB may lend up to EUR 2.48 billion during 2000-2006 to support capital investment projects implemented by subsidiaries of EU companies or joint-ventures between EU and ALA firms, or investment that results in environmental improvements or fosters regional integration.
The EIB was set up in 1958 to finance investment furthering EU integration. It lends for regional development, infrastructure, energy, industry and environment. Outside the EU, the Bank contributes to the European development co-operation policy in some 130 countries in Central and Eastern Europe, the Mediterranean region, Africa, the Caribbean and the Pacific, Asia and Latin America.
In 1999, the EIB provided loans totalling some EUR 32 billion, of which EUR 4 billion for projects outside the EU. The Bank borrows on the capital markets the funds for its lending. Its bonds have regularly been rated "AAA" by the leading rating agencies. The EIB works on a non-profit basis and can pass on to project promoters the excellent conditions it obtains on the markets. The EIB may finance up to 50 percent of project cost. On average it provides one third of the funding and co-finances investments with other institutions.
(1) 1 EUR = 0.971400 USD.