China Eximbank provides $147 million buyer’s credit loan for 220MW Son Dong Coal-Fired Power Plant Construction Project

In January 2005 during an official visit to Hanoi, the Chinese Government and Government of Vietnam signed a loan framework agreement for the 220MW Son Dong Coal-Fired Power Plant Construction Project. Then on May 12, 2006, China Eximbank and Vietnam National Coal and Mineral Industries Holding Limited (Vinacomin) — a state-owned mining company — signed a $147 million buyer's credit loan (BCL) agreement for this project. The borrowing terms of the loan are unknown. The proceeds of the loan were used to partially finance an EPC contract signed in 2005 with China Shanghai (Group) Corporation for Foreign Economic & Technological Cooperation (SFECO or 中国上海外经(集团)有限公司). The purpose of the project was to construct a 220MW coal-fired power plant — with two, 110MW power generation units (Unit 1 and Unit 2) — in Thanh Luận commune, Sơn Động district, and Bắc Giang province. SFECO was the general EPC contractor responsible or implementation. Shanghai Electric Power Construction Co., Ltd -- a subsidiary of PowerChina -- was also involved in implementation (most likely as a subcontractor). The project officially commenced on May 18, 2006 and it was expected to reach completion within 33 months. On December 31, 2008, Unit 1 was successfully connected to the national power grid. By October 29, 2010, Unit 1 and Unit 2 completed a 30-day reliability operation test, and the two units were successfully handed over to the power plant owner on January 8, 2011.

Additional details

1. This project is also known as the 2x110MW Son Dong Thermal Power Plant Project, the 220 MW Son Dong Coal-Fired Power Station Project, and the Sơn Động Coal-Fired Power Station Project. The Chinese project title is 的越南2×110MW山洞燃煤电站项目 or 越南山洞项目. The Vietnamese project title is công dự án Nhiệt điện Sơn Động. 2. The China Eximbank loan that supported this project is not included in the Overseas Development Finance Dataset that Boston University’s Global Development Policy Center published in December 2020. 3. Vinacomin may have on-lent the proceeds of the loan from China Eximbank to a subsidiary called Son Dong Thermal Power Company (Công ty Nhiệt điện Sơn Động). However, this issue requires further investigation.

Number of official sources

12

Number of total sources

20