CDB provides loan for 135 MW Kyauk Phyu Combined Cycle Power Plant Construction Project (Linked to Project ID#88703)

On March 27, 2019, Kyauk Phyu Electric Power Company Limited (KPEPC) — a special purpose vehicle and joint venture of Power China Resources Limited (75% equity stake) and Myanmar Supreme Trading Company Limited (25% equity stake) — was legally incorporated in Myanmar. Then, in July 2019, Myanmar’s Electric Power Generation Enterprise (EPGE), a state-owned energy company, invited tenders for the 135 MW Kyauk Phyu Combined Cycle Power Plant Construction Project to be implemented on a build-operate-own (BOO) basis. On November 5, 2019, a power purchase agreement (PPA) was signed by EPGE, Myanmar’s Ministry of Electricity and Energy (MOEE) and KPEPC. A land lease agreement was signed on September 11, 2020. Then, in March 2021, KPEPC secured approval from the Foreign Exchange Management Department of the Central Bank of Myanmar to receive overseas financing for the implementation of the 135 MW Kyauk Phyu Combined Cycle Power Plant Construction Project. On May 27, 2021, KPEPC and the Government of Myanmar’s MOEE signed a 25-year concession agreement. The total estimated cost of the independent power project was $180 million and it was financed according to a debt-to-equity ratio of 70-30. China Development Bank (CDB) is identified by an official source as the project’s source of debt financing. CDB reportedly issued an insured loan with an interest rate of 6-7%. The proceeds of the loan were to be use by the borrower to partially finance a commercial contract between KPEPC and Power China Resources Limited, which was signed on December 10, 2020. The purpose of the project was to build a 135 MW combined cycle power plant near the Kyauk Phyu 230KV main substation in Kyauk Phyu Township, Kyauk Phyu District, and Rakhine State. Power China Resources Limited was the EPC contractor responsible for the implementation of the project. Implementation commenced on February 5, 2021. The power plant was connected to the national grid on December 7, 2022. The project was originally scheduled to reach completion on November 30, 2022.

Additional details

1. The Chinese project title is 皎漂燃气电站项目 or 皎漂燃气电站. The Burmese project title is ကျောက်ဖြူ ၁၃၅ မဂ္ဂါဝပ် သဘာဝဓာတ်ငွေ့နှင့်စွန့်ပစ်အပူသုံး ဓာတ်အားပေးစက်ရုံစီမံကိန်း. 2. According to the website of Rakhine Development Corporation Limited (RDCL), a state-owned corporation in Myanmar, CDB was the source of debt financing and it agreed to issue a loan with a 6-7% interest rate. For the time being, AidData assumes an interest rate of 6.5% and a loan commitment worth $12 million (70% of $180 million). 3. Myanmar Supreme Trading Company Limited was established in 1990 and has maintained a good cooperative relationship with the local energy and power departments. Its main business is mainly to supply, install and construct power transmission and transformation equipment. It constructed Myanmar's first 230kV steel pipe pile transmission line. Power China Resources Limited, a subsidiary of Power Construction Corporation of China, was established in Beijing on September 4, 2012 with registered capital of RMB 5.41 billion. 4. It is unknown if the Government of Myanmar issued a sovereign guarantee in support of the CDB loan for this project. It is also unknown if Sinosure is the source of credit insurance. These issues warrant further investigation. 5. Mr. Jiang Xingcheng is the Chief Executive Officer of KPEPC. His phone number is +959 266679966 and his email address is Jiangxingcheng-sdht@powerchina.cn. The Financial Manager of KPEPC is Gu Yonglin (email address: guyonglin@powerchina.cn). 6. The CDB loan’s precise signature (financial commitment) date is unknown. For the time being, AidData relies on a proxy for the loan commitment date (March 2021): when KPEPC secured approval from the Foreign Exchange Management Department of the Central Bank of Myanmar to receive overseas financing.

Number of official sources

25

Number of total sources

43