CDB provides $310 million loan for Slantsy Cement Plant Construction Project

On June 14, 2009, China Development Bank (CDB) and Vnesheconombank (VEB) — a Russian government-owned development bank — signed a $310 million loan agreement for the Slantsy Cement Plant Construction Project. This loan carried a maturity of 9 years, a grace period of 1.5 years, and an interest rate of 6-month LIBOR (1.18% in June 2009) + a 5.76% margin. The loan’s final maturity date was June 22, 2018. Vnesheconombank used the proceeds of this loan to on-lend to a company called Open Joint Stock Company LSR Group (or LSR Group OJSC), which is a Russian real estate development, construction and building materials company and the largest developer and manufacturer of construction materials in Russia’s North-West Federal District. This on-lending agreement [Loan Agreement No.110100/1031] was signed on June 29, 2009. The CDB loan was approved under a $1 billion framework agreement that VEB and China Development Bank signed in 2009 to support investment projects and activities by Chinese companies conducting business in the Russian Federation, including those related to timber processing, energy and construction (see Project ID#43036). The total cost of the Slantsy Cement Plant Construction Project was EUR 442.2 million and it was supported by an additional EUR 107 million loan from ABN AMRO and HSBC. The purpose of the project was to construct a cement plant — in the city of Slantsy within Leningrad Oblast — with a production capacity of 1.86 million tons of cement per year. The plant uses state-of-the-art production lines manufactured by FLSmidth of Denmark, a world leader in cement manufacturing equipment. It uses the most efficient ‘dry’ technology, which also provides for partial use of oil shale waste in the cement production process that ensures over 40 percent of the energy required for production lines. The project site in Slantsy occupies an area of 40 hectares, excluding quarries, access roads and railways. OOO Cement Northwest (or Cement North-West LLC), a wholly owned subsidiary of Hefei Cement Research and Design Institute, was the general contractor responsible for implementation. A groundbreaking ceremony of the plant took place on May 27, 2008. On November 27, 2010, LSR Group performed a ‘technological launch’ of the plant. Then, on July 14, 2011, the plant was officially commissioned. The final project acceptance certificate was signed by the project owner on July 19, 2012. The plant’s level of cement production in 2013 reached 1.3 million tons and in 2014 it reached about 1.5 million tons. On January 22, 2015, LSR Group OJSC sold the plant to a company called EUROCEMENT.

Additional details

1. The Russian project title is Сланцевский Цементный завод.

Number of official sources

14

Number of total sources

17