China Eximbank pledges export buyer's credit loan for Cienfuegos Refinery and LNG Terminal Expansion Project (Linked to Record ID#40556)

Project narrative

On June 5, 2010, a three-way letter of intent was signed between the Cuban-Venezuelan SPV, Cuvenpetrol (CUPET), China National Petroleum Corporation's Huanqiu Contracting and Engineering unit, and the Italian unit of French oilfield service company, Technip TECF.PA, for the Cienfuegos Refinery Expansion Project . Cuvenpetrol and Huanqui also signed a separate letter of intent that involves a contract to build a liquefied natural gas project, including a regasifcation plant built at or near the refinery . The expansion of Cuba's Cienfuegos oil refinery, the largest in the country, as well as the addition of a LNG terminal attachment are to be funded via a single loan from China Eximbank, using Venezuelan oil as collateral . China Eximbank has agreed to finance 85% of the total cost of the project, which is reportedly $6 billion USD . This loan will be secured by China Export & Credit Insurance Corp. (SINOSURE) ; therefore the financing is likely export buyer's credits. The refinery has an estimated cost of $4.5 billion and the LNG terminal is expected to cost $1.3 billion The expansion will increase the refinery's capacity from 65,000 barrels per day to 150,000 barrels per day . The LNG (gas liquefaction) terminal will have the capacity to process 2 million tons of gas annually and also includes a 150 MW electricity generation plant . China National Petroleum Corporation (CNPC)'s Haunqiu Contracting and Engineering Corporation is the contractor for the expansion . Construction was expected to begin in 2011 and be completed in 2013 . As of May 2014, the Chinese Government had delayed funding of the Cienfuegos expansion, arguing complications in their agreement with Venezuela The project is currently stopped . The formation of Cuvenpetrol, the SPV created in 2005 between Cubapetróleo (Cupet) and Petróleos de Venezuela SA (PDVSA) to run the Cienfuegos Refinery, is captured in #40556. However, on 14 December, 2017, Cuba took Venezuelan state oil-firm PDVSA’s 49% stake in the Cienfuegos Refinery as payment for debts Venezuela incurred . Since then, Cuba has had full ownership of the plant .