China Eximbank provides export seller's credit for 230kV Nabar-Shrebo-Ohntaw Power Transmission Line and Substation Project (Linked to Record ID#63968)

Project narrative

In January 2016, China Electric Power Equipment and Technology Co., Ltd (CET) and the Ministry of Electricity and Energy of Myanmar signed a $133.47 million EPC+F (engineering, procurement, construction, and finance) contract for the 230kV Nabar-Shrebo-Ohntaw Power Transmission Line and Substation Project. Under most EPC+F contractual arrangements, the EPC contractor is responsible for securing a loan to finance the EPC contract but the host government is responsible for providing a sovereign guarantee on debt repayment and an equity infusion. Under the terms of the January 2016 EPC+F contract, the Government of Myanmar was responsible for financing 35% of the project cost (through an equity infusion) and CET was responsible for securing financing for the remaining 65%. China Eximbank issued an export seller’s credit to CET to finance its portion of the EPC+F contract (worth $86,755,000, or 65% of $133.47 million). CET also secured credit insurance from Sinosure. Ministry of Electricity and Energy of Myanmar is the project owner. China Electric Power Equipment and Technology Company is the EPC contractor. The purpose of the project was to construct two 230kV substations (the Shwebo primary substation and Ohndaw substation) and two 230kV double-circuit transmission lines (measuring 290 km in length) that pass through Nabar and Shwebo before reaching Ohntaw. The transmission line starting point is at the Dapein (1) Hydropower Station [also known as the Taiping River Hydropower Station or တာပိန်(၁)] in Kachin State and the ending point is near Mandalay, the second largest city in Myanmar. The geographical coordinates of the Dapein (1) dam are east longitude of 97°31´35" and north latitude of 24°25´18". The geographical coordinates of the Dapein (1) power plant are east longitude of 97°30´02" and north latitude of 24°24´15"15. The ultimate purpose of the project is to expand access to electricity in Kachin state and Sagaing Region. The project is an important part of Myanmar's "Northern Power to South" backbone power grid. After the completion of the project, the northern Myanmar power grid will be connected with the Myanmar national backbone network, and the electricity in the northern Myanmar region will be easily transported to the southern region to help solve the power shortage problem in southern Myanmar. A formal groundbreaking ceremony took place on November 10, 2017. Dr. Tun Naing, Myanmar’s Deputy Minister for Ministry of Electricity and Energy, conducted an on-site project inspection on December 31, 2018. A project completion ceremony was held on January 11, 2020. The project was originally expected to reach completion in October 2019. China Eximbank also provided a loan for the construction of the Dapein (1) power plant (captured in Record ID#63968).