China Development Bank pledges loan for 240MW Loznica Thermal Power Station Project

Project narrative

In 2016, China Development Bank (CDB) agreed in principle to issue a Sinosured-backed loan for the 240MW Loznica Thermal Power Station Project. The proceeds of this loan, if approved, would be used to finance an EPC contract worth EUR 231 million between Scarborough Group International — a UK real estate firm owned by Kevin McCabe — and China National Electric Engineering (CNEEC) in order to develop a new combined cycle natural gas-fueled heat and power plant project (with a planned capacity of 240 megawatts) in an industrial area within the city of Loznica. The EPC contract was signed on June 8, 2016. The project would be implemented in two phases. The first phase of the project (120 MW of the total capacity) was originally expected to reach completion by the end of 2018. The second phase of the project (the remaining 120 MW) was slated to begin in 2019. The ultimate aim of the project was to convert an obsolete set of coal-fired plants into natural gas facility, thereby reducing Serbia's dependency on imported electricity. The project site is situated at the crossroads of key high voltage electrical transmission lines and is adjacent to international gas pipelines, giving it the ability to both supply the domestic market and export power to other countries in South and Central Eastern Europe.