Document of
                       The World Bank


                                                Report No: 65961-ET




                    RESTRUCTURING PAPER

                            ON A

               PROPOSED PROJECT RESTRUCTURING
                                OF
ETHIOPIA/NILE BASIN INITIATIVE: ETHIOPIA-SUDAN INTERCONNECTOR
                             PROJECT
                              CREDIT
                        DECEMBER 20, 2007


                           TO THE

              DEMOCRATIC REPUBLIC OF ETHIOPIA


                      DECEMBER 9, 2011
 Regional Vice President:        Obiageli Katryn Ezekwesili
        Country Director:        R. Gregory Toulmin
Sector Manager / Director:       Lucio Monari / Jamal Saghir
       Task Team Leader:         Raihan Elahi




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     ETHIOPIA — ETHIOPIA/NILE BASIN INITIATIVE: ETHIOPIA-SUDAN
                    INTERCONNECTOR PROJECT
                              P074011
                          CREDIT 4375-ET

                                  Restructuring Paper



1.     The closing date for Ethiopia - Ethiopia/Nile Basin Initiative: Ethiopia-Sudan
Interconnector project, Credit 4375-ET, P074011 will be extended from December 31,
2011 until June 30, 2012.

2.      The transmission line planned under the project has completed construction and it
has been commissioned. Three substations planned under the project are almost
complete. The project performance is currently rated as Moderately Satisfactory given
the delays in construction and the Project Development Objectives continue to be
achievable.

3.      The proposed extension is necessary to allow sufficient time to the implementing
agency to complete project construction activities. Since June 2011, the implementing
agency couldn’t transfer funds to the substation contractor due to reasons beyond project
control. Recently, the contractor opened a foreign currency account in Ethiopia, which
has again allowed the implementing agency to transfer funds to the contractor.
However, given the recent delays in construction, the implementing agency requires
additional 6 months according to its revised implementation plan to complete the project
construction works.

4.     All audit reports under this project have been submitted to the Bank.

5.     This will be the first extension of the project which is extending the closing date
by about six months from the original closing date.




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