Chinese Government provides RMB 239.6 million loan for Di-Ammonium Phosphate Fertilizer Plant Construction Project (Linked to Project ID #39369, #38969)

In 2000, the Chinese Government offered $53.29 million of debt financing to the Government of Bangladesh to build an 800 ton-per-day di-ammonia phosphate fertilizer plant in Chittagong. The total cost of the project was $59.21 million, and the Government of Bangladesh agreed to supply the remaining $6 million. Under a contract signed between China National Complete Plant Import and Export Corporation Limited (COMPLANT) and Bangladesh Chemical Industries Corporation (BCIC), the Chinese Government agreed to provide an RMB 200 million loan for the project. The loan agreement was finalized on September 13, 2000, and it carried the following terms: 20-year maturity, 10 year grace period, 0% interest rate. COMPLANT agreed to provide an additional $29.11 million from a supplier’s credit, which in turn funded with the proceeds from an export seller’s credit that it received (see Project ID#38969). A follow-on loan agreement with the Chinese Government for an “800 Metric Tons of 800 MT DI-AMMONIUM PHOSPHATE (DAP) Project” was signed on September 7, 2005 (see Government of Bangladesh loan ID# L1120050907a). This RMB 239,667,000 loan agreement carried the following terms: 16-year maturity, 4 year grace period, and a 2% interest rate. Construction of the di-ammonium phosphate fertilizer plant — known as Di-Ammonium Phosphate Fertiliser Company Ltd (DAPFCL) — was expected to begin at the end of 2000 and projected to commence operations within 30 months. However, the project did not commence until April 2004 and it was not completed until June 2006. In August 2016, an ammonia tank at the plant exploded, causing at least 50 people to fall sick from inhaling toxic gas. The emission of toxic ammonia at the fertilizer factory was brought under control on August 23, 2016, some 11 hours after one of two smaller 500-tonne capacity ammonia storage tanks exploded. Fifty people, including women, were admitted to the Chittagong Medical College Hospital (CMCH). BCIC, which now runs the factory, formed a 10-member committee to investigate the incident. Di-Ammonium Phosphate Fertiliser Company Ltd (DAPFCL) is located within the Anowara Upazilla (SubDistrict) of Chittagong Division. More detailed locational information is available at https://www.google.com/maps/place/Di-Ammonium+Phosphate+Fertilizer+Company/@22.219927,91.8293422,15z/data=!4m5!3m4!1s0x0:0x1b6c5969e926d431!8m2!3d22.219927!4d91.8293422 and http://ksblbd.com/wp-content/uploads/2020/04/Volume-I_Executive-Summary-of-ESIA-Report_KDDL_22-Nov-2019.pdf.

Additional details

The Government of Bangladesh loan ID# is L1120000913a. The Government of Bangladesh project title is “MTDP DI-AMMONIUM PHOSPHATE (DAP)

Number of official sources

5

Number of unofficial sources

9