ICBC provides $69.7 million buyer’s credit for 35MW Broadlands Hydropower Project

Project narrative

On March 12, 2013, ICBC and the Ceylon Electricity Board signed a $69.7 million buyer’s credit (loan) agreement for the 35MW Broadlands Hydropower Project. This loan carries the following borrowing terms: a grace period of 3 years, a maturity of 15 years, and an interest rate of 6-month LIBOR plus a 3.2% margin. The loan’s final maturity date is March 12, 2028. The Government of Sri Lanka issued a sovereign guarantee in support of the loan. Sinosure provided buyer’s credit insurance. The proceeds of the $69.7 million ICBC loan were to be used by the borrower to finance 85% of the total cost of an $82 million commercial contract with China National Electricity Equipment Corporation, which was signed on October 20, 2010. Hatton National Bank of Sri Lanka financed the remaining 15% of the project cost. The principal amount outstanding under the ICBC loan was $6.05 million as of December 31, 2015, $17.18 million as of December 31, 2016, $28 million as of December 31, 2017, $24.98 million as of December 31, 2018, $23.13 million as of December 31, 2019, and $30.95 million as of December 31, 2020. The project involved the construction of 35 MW run-of-the-river hydroelectric complex over the Kelani River in Kitulgala. Its exact locational coordinates are 06°58′44″N 80°27′16″E. More specifically, the project involved the construction of a 24 meter high & 144 meter long main dam, a 19 meter high & 48 meter long diversion dam, a 2.7 meter diameter & 850 meter long diversion tunnel, a 5.4 meter diameter & 3 km long main tunnel, a 35MW surface power station (2 units of 17.5MW), a switch yard, and a 4 km long transmission line. The complex has an installed capacity of 35 MW and is expected to generate 126 GWh of electrical energy annually. The contractor responsible for implementation was China National Electric Equipment Corporation. Its work was supervised by Ceylon Electricity Board, the largest electricity company in Sri Lanka. Construction was originally expected to commence on January 15, 2013; however, it ultimately began on July 17, 2013. River closure took place on November 20, 2016. On June 6, 2019, a breakthrough ceremony of the main headrace tunnel took place. As of August 2020, the project had achieved a 74.79% completion rate. Then, in November 2021, an inaugural ceremony was held for the release of water to the main tunnel of the Broadlands Hydropower Project.