Bank of China (Jakarta Branch) contributes $191 million to $454.9 million syndicated loan for 945MW Banten Lontar Power Plant Construction Project

Project narrative

On May 4, 2009, Bank of China and Perusahaan Listrik Negara (PLN) — an Indonesian government-owned corporation that has a monopoly on electricity distribution in Indonesia and generates the majority of the country's electrical power — signed a $454,974,082 loan agreement for the 945MW Banten Lontar Power Plant Construction Project. Bank of China's Jakarta Branch and Sichuan Branch each contributed $191 million to the syndicate, while BNP Paribas and Société Générale each contributed $36.4 million. The loan carried the following borrowing terms: a 13-year maturity, a 3-year grace period, and an interest rate of 6-month LIBOR (1.356% in May 2009) plus a a 2.3% margin. It was backed by a Sinosure credit insurance policy. The proceeds of the loan were to be used by the borrower to partially finance the $820 million cost of an EPC contract between PLN and a consortium consisting of Dongfang Electric Corporation and Dalle Energy (an Indonesian firm), which was signed on August 7, 2007. The purpose of the project was to install a 945-megawatt (MW) coal-fired power plant — with three 315MW generators (Unit 1, Unit 2, and Unit 3) — in Lontar Village in Banten Province (locational coordinates: -6.0588745, 106.4643002). The electricity generated by the power plant is transmitted through the PLTU substation, the Teluk Naga substation, and then Tangerang Baru substation. Construction took place between January 6, 2009 and February 13, 2012. Unit 1 was officially inaugurated and put into commercial use on December 28, 2011. Unit 2 was put into commercial use on February 29, 2012. Unit 3 was put into commercial use on April 10, 2012. The project was officially completed and handed over to the local authorities on December 28, 2012.