Egypt signed on Sunday a $600 million loan deal with the European Investment Bank (EIB) to finance a new power plant in Beheira governorate, reported Al-Ahram daily.

The loan is part of a financing package for the $1.3 billion power plant in Beheira's Damanhour, which also includes a $200 million loan from the Arab Fund for Economic and Social Development and a $80 million loan from the African Development Bank.

Damanhour Electricity Company – a subsidiary of the Egyptian Electricity Holding Company – will carry $240 million of the project costs.

The project, with a capacity of 1,800 megawatts, is part of the government's five-year plan to develop the national power grid by 2017.

Egypt is seeking to develop its power grid and diversify its electricity sources after an energy crisis worsened in the past few years and limited industrial and business activities.