Narrative
Full Description
Project narrative
On December 20, 2000, China Eximbank issued an RMB 1.1 billion seller’s credit to China Machinery Equipment Import and Export Corporation and the Shanghai Electric Group for the 2x325MW Shazand Power Plant Project. The proceeds of the seller's credit were apparently used to on-lend to the Government of Iran and finance a commercial contract that it signed with China Machinery Equipment Import and Export Corporation and the Shanghai Electric Group in June 1996. The Chinese contractors were responsible for designing a power plant in the city of Shazahand within Iranian Azerbaijan (Shazand County, Markazi Province) with two 325,000 kilowatt generating units. They were also responsible for engineering management, civil engineering, and equipment installation (including boilers, steam turbines, generating sets, meter control systems and electricity systems). The originally expected project completion date was March 20, 2004. This first power generation unit was commissioned in 2004 and the second power generation unit was commissioned in 2005.
Staff comments
1. The Chinese project title is 伊朗Sahand热电站, 2×325MW. The Persian project title is نیروگاه شازند. 2. According to the World Bank's Debtor Reporting System (DRS), the weighted average grace period of all official sector lending from all Chinese creditors to government and government-guaranteed borrowing institutions in Iran was 4.5756 years in 2000. AidData estimates the grace period of the China Eximbank loan that supported the 2x325MW Shazand Power Plant Project by using this figure. See https://www.dropbox.com/scl/fi/ef7q4y9pxjk6q3syuqmjy/May-2024-DRS-Extraction-of-Data-on-Official-and-Private-Chinese-Loans-to-Iran-and-Borrowing-Terms.xlsx?rlkey=wiqjmhuwunp3jelz3jyfepny8&dl=0 3. According to the World Bank's Debtor Reporting System (DRS), the weighted average maturity of all official sector lending from all Chinese creditors to government and government-guaranteed borrowing institutions in Iran was 12.0664 years in 2000. AidData estimates the maturity of the China Eximbank loan that supported the 2x325MW Shazand Power Plant Project by using this figure. See https://www.dropbox.com/scl/fi/ef7q4y9pxjk6q3syuqmjy/May-2024-DRS-Extraction-of-Data-on-Official-and-Private-Chinese-Loans-to-Iran-and-Borrowing-Terms.xlsx?rlkey=wiqjmhuwunp3jelz3jyfepny8&dl=0 4. According to the World Bank's Debtor Reporting System (DRS), the weighted average interest rate of all official sector lending from all Chinese creditors to government and government-guaranteed borrowing institutions in Iran was 7.3739% in 2000. AidData estimates the interest rate of the China Eximbank loan that supported the 2x325MW Shazand Power Plant Project by using this figure. See https://www.dropbox.com/scl/fi/ef7q4y9pxjk6q3syuqmjy/May-2024-DRS-Extraction-of-Data-on-Official-and-Private-Chinese-Loans-to-Iran-and-Borrowing-Terms.xlsx?rlkey=wiqjmhuwunp3jelz3jyfepny8&dl=0