CDB provides $300 million loan for Kara-Balta Oil Refinery Project

Project narrative

In September 2013, China Development Bank (CDB) signed a framework loan agreement agreement with China Petrol Company Junda LLC (also known as Zhongda China Petrol Company or «Чайна Петроль компании Джунда») for the Kara-Balta Oil Refinery Project. By the end of 2015, CDB had disbursed $300 million to China Petrol Company Junda LLC through this framework agreement. China Petrol Company Junda LLC is a project company established to manage the financing, design, and implementation of the Kara-Balta Oil Refinery Project (also known as the Zhongda Oil Refinery Project in Kara-Balta). China Petrol Company Junda LLC is owned by Central Asia Energy Co., Ltd, which in turn is owned by Shaanxi Dade Investment Group Co., Ltd and Shaanxi Coal and Chemical Industry Group (a Chinese state-owned enterprise). Kara-Balta Oil Refinery Project was initiated on September 9, 2013. The refinery produced its first barrel of oil was produced in January 2014. The refinery was officially put into operation on January 1, 2017. It processes crude oil that is imported by rail from Russia and Kazakhstan, as well as a small amount from Kyrgyzstan itself. The refinery paid the Kyrgyz government $43 million USD dollars in 2018, making it the country's second-largest taxpayer. It is also one of the nation's largest employers, hiring over 2,000 locals. However, the project has also been plagued by controversy. It was forced to suspend operations in 2015 temporarily after local demonstrations against pollution. Activists in Kara-Balta said residents living close to the refinery were unable to open their windows due to a heavy thick industrial smell and pollution. The plant resumed production in 2016.