Narrative
Full Description
Project narrative
On April 4, 2007, the Export-Import Bank of China and Vietnam Electriity (EVN) signed a $355,793,000 buyer's credit loan (BCL) agreement (BLASH 2007003) for the 600MW Quang Ninh 2 Coal-Fired Power Plant Construction Project. The borrowing terms of the loan are as follows: a 17-year maturity, a 7-year grace period, a 5.2532% interest rate, a 0.2% annual re-lending fee (based on the outstanding principal), and a 0.2% commitment fee. The loan’s final maturity date is 2023. The borrower was responsible for making 20 consecutive, semi-annual principal payments to the lender (after the expiration of the grace period). EVN on-lent the proceeds of the China Eximbank loan to Quang Ninh Thermal Power Joint Stock Company (QTP JSC), a project company that is jointly owned by EVN (80%), Vinacomin (15%), and Vinaconex (5%). The proceeds of the loan were to be used by the ultimate borrower to partially finance a $418 million engineering, procurement, and construction (EPC) contract signed on November 16, 2006 with Shanghai Electric Group Company Limited. Sinosure provided buyer’s credit insurance. The loan was also collateralized with specific assets, facilities, and equipment of the Quang Ninh 1 Coal-Fired Power Plant and the Quang Ninh 2 Coal-Fired Power Plant (owned by Quang Ninh Thermal Power Joint Stock Company). The total collateral value of these items (as of June 30, 2022) was VND 18,790,866,943,157 (equivalent 78.67% of the total value of the mortgaged assets). The purpose of the project was to construct a 600MW coal-fired power plant — with two, 300MW power generation units (Unit 3 and Unit 4) — in Hà Khánh ward, Hạ Long city, and Quảng Ninh province. Shanghai Electric Group Company Limited was the EPC contractor responsible for implementation. Construction began on May 28, 2007. Unit 3 was connected to the national grid on December 13, 2012. It secured a temporary Acceptance Certificate (PAC) certificate on January 1, 2014. Unit 4 was connected to the national grid on September 9, 2013. It secured a temporary Acceptance Certificate (PAC) certificate on March 16, 2014. Units 3 and 4 began commercial operations on June 1, 2015.
Staff comments
1. The Vietnamese project title is Dự án Nhiệt điện Quảng Ninh 2. The Chinese project title is 南广宁300MW*2 燃煤火电 or 越南广宁二期项目. 2. The China Eximbank loan that supported this project is not included in the Overseas Development Finance Dataset that Boston University’s Global Development Policy Center published in December 2020. 3. In 2006, China Eximbank also issued a $407 million buyer’s credit loan for the Quang Ninh 1 Coal-Fired Power Plant Construction Project (as captured via Record ID#65940). 4. Evidence of the loan's collateralization ("Hình thức đảm bảo khoản vay: Khoản vay được đảm bảo bằng một số hạng mục công trình, thiết bị của Dự án Nhà máy Nhiệt điện Quảng Ninh 1 và Dự án Nhà máy Nhiệt điện Quảng Ninh 2 với giá trị 18.790.866.943.157 VNĐ tương đương 78,67% tổng giá trị tài sản thế chấp;") is provided ơn pg. 25 of https://cafef1.mediacdn.vn/Images/Uploaded/DuLieuDownload/2022/QTP_22Q2_BCTC_SX.pdf