Overview

China Eximbank provides $32.6 million loan for Power Transmission System Associated with the Liouesso Hydroelectric Dam Construction Project (Linked to Record ID#60219)

Commitments (Constant USD, 2023)$35,355,412

Commitment Year•2012Country of Activity•CongoDirect Recipient Country of Incorporation•CongoSector•EnergyFlow Type•Loan

Status

Project lifecycle

Completion

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date: Jul 13, 2012

Start (actual): Dec 25, 2012

End (actual): May 29, 2017

First repayment (originally scheduled): Dec 30, 2016

Last repayment (originally scheduled): Dec 28, 2026

Geospatial footprint

Map overview

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The project involved the construction of a power transmission system to evacuate electricity from the Liouesso hydroelectric dam. More specifically, it involved the construction of 74-km 110kV transmission line from Liouesso to Ouesso, a 85-km 30kV transmission line from Ouesso to Makoua and Owando to Makoua, one 110kV substation in Ouesso, and four 30kV substations (in Makoua and elsewhere). More detailed locational information can be found at: https://www.openstreetmap.org/way/662465053 and https://www.openstreetmap.org/way/470573738 and https://www.openstreetmap.org/way/470573741 and https://www.openstreetmap.org/way/470573739

Stakeholders

Organizations involved in projects and activities supported by financial and in-kind transfers from Chinese government and state-owned entities

Ultimate beneficial owners

At least 25% host country ownership

Funding agencies

State-owned Policy Banks

Export-Import Bank of China (China Eximbank)

Receiving agencies

Government Agencies

Government of Republic of Congo

Implementing agencies

State-owned companies

China Machinery Engineering Corporation (CMEC)
China National Cable Engineering Corporation

Collateral providers

State-owned companies

Société Nationales des Pétroles Congolais (SNPC)

Loan description

China Eximbank provides $32.6 million loan for Power Transmission System Associated with the Liouesso Hydroelectric Dam Construction Project

Grace period•5 yearsGrant element•58.2883%Interest rate (t₀)•0.25%Interest type•Fixed Interest RateMaturity•15 years

Collateral

This China Eximbank loan -- and other subsidiary China Eximbank loans approved under a June 19, 2006 framework agreement that was renewed/extended in 2012 -- was collateralized against cash proceeds from SNPC oil export sales to Chinese importers (through an offtake agreement), which were deposited in a China Eximbank-controlled escrow account. The Republic of Congo was required to maintain a minimum cash balance in the escrow account equivalent to approximately 20% of its total outstanding debt to China Eximbank. The cash balance in the China Eximbank-controlled escrow account was $534,238,226 (CFA 272,846,414,000) in 2011, an unknown amount in 2012, an unknown amount in 2013, an unknown amount in 2014, an unknown amount in 2015 (equivalent to 26% of SNPC oil sales in 2015), $281,560,937 in 2016 (equivalent to 7,558,672 barrels of oil or 32% of SNPC oil sales in 2016), $338,285,020 in 2017 (equivalent to 23.25% of SNPC oil sales in 2017), $513,780,005 in 2018 (equivalent to 7,411,386 barrels of oil, eight oil cargoes, or 30.22% of SNPC oil sales in 2018), $523,547,187 in 2019 (equivalent to 8,228,065 barrels of oil, 9 oil cargoes, or 32.56% of SNPC oil sales in 2019), $266,659,781 in 2020 (equivalent to 6,349,813 barrels of oil, 7 oil cargoes, or 31.61% of SNPC oil sales in 2020), $319,164,228 in 2021 (equivalent to 4,585,056 barrels of oil or 21.4% of SNPC oil sales in 2021), and $356,343,684 in 2022 (equivalent to 3,634,514 barrels of oil 13.09% of SNPC oil sales in 2022).

Narrative

Full Description

Project narrative

On June 19, 2006, China Eximbank and the Republic of Congo signed a $1.6 billion loan framework agreement — also known in the Republic of Congo as the “strategic partnership” (“partenariat stratégique”) — that allowed the Republic of Congo to obtain China Eximbank loans for infrastructure projects through a securitization mechanism: Société Nationales des Pétroles Congolais (SNPC)—the country’s state-owned oil company—agreed to deposit a portion of the cash proceeds from its oil exports into an escrow account that is controlled by China Eximbank. This framework agreement (captured in Record ID#60219) was ratified on October 26, 2006. One of the subsidiary loans that was approved through the framework agreement was a $32,621,176.00 loan in 2012 for the Power Transmission System Associated with the Liouesso Hydroelectric Dam Construction Project. The estimated borrowing terms of the loan are as follows: 15-year maturity, 5-year grace period, and a 0.25% interest rate. Its (principal) amount outstanding was $19,025,883 as of December 31, 2019. The proceeds of the loan were to be used by the borrower to partially finance a $40 million commercial contract between the Republic of Congo and China Machinery Engineering Corporation (CMEC), which was signed on July 13, 2012. The project involved the construction of a power transmission system to evacuate electricity from the Liouesso hydroelectric dam. More specifically, it involved the construction of 74-km 110kV transmission line from Liouesso to Ouesso, an 85-km 30kV transmission line from Ouesso to Makoua and Owando to Makoua, one 110kV substation in Ouesso, and four 30kV substations (in Makoua and elsewhere). CMEC was the contractor responsible for project implementation. The project began on December 25, 2012, passed an initial inspection on November 14, 2015, and was commissioned on June 23, 2016. The project successfully passed its final inspection test on May 27, 2017. Then, on May 29, 2017, a power-on celebration and ribbon-cutting ceremony was held.

Staff comments

1. This project is also known as the Power Transmission Project of Liouesso Hydropower Station. The French project title is Transport d'energie Liouesso or Reseau de Transport National Poste de Transformation THT 110/30kv de Ouesso. The Chinese project title is 刚果（布）利韦索水电站配套输变电项目 or 刚果输变电工程. 2. In the database of Chinese loan commitments that SAIS-CARI released in July 2020, it identifies a $37 million China Eximbank loan (with a maturity length of 20 years) for this project. AidData relies on the face value of the loan ($32,621,176.00) and the maturity length (15 years) that is recorded by the Republic of Congo’s Public Debt Agency (Caisse Congolaise d’Amortissement or CCA) and Délégation Générale des Grands Travaux (DGGT). Also, according to a 2019 report published by the Republic of Congo’s National Assembly, all loans approved under the June 19, 2006 framework agreement had an interest rate of 0.25%, so AidData assumes an interest rate of 0.25%.