China Eximbank provides RMB 200 million overseas project contracting loan for 440MW Mao Khe Coal-Fired Power Plant Construction Project (Linked to Project ID#65937)

On April 7, 2011, the Hubei Branch of the Bank of China (BOC) and BNP Paribas (a French banking group) signed a $275 million syndicated buyer’s credit loan agreement with Vietnam National Coal, Mineral Industries Corporation (Vinacomin) — a Vietnamese state-owned enterprise — for the 440MW Mao Khe Coal-Fired Power Plant Construction Project. BOC contributed $260 million to the syndicated loan (captured via Project ID#65937). The loan carries a 13-year maturity, but its interest rate and grace period are unknown. The Vietnamese Ministry of Finance provided a sovereign guarantee for the loan and Sinosure provided buyer’s credit insurance. Then, on February 25, 2012, the Export-Import Bank of China issued a buyer’s credit loan worth approximately RMB 200 million for the same project (captured via Project #73296). This loan reportedly carried a maturity of 3 years and an interest rate of 3.51%. Sinosure also provided buyer’s credit insurance for this loan. The Export-Import Bank of Vietnam also provided a $56 million loan — with a 13-year maturity, 3-year grace period, and 4.5-4.8% interest rate — for the project. The proceeds from these three loans were used to partially finance a $429.5 million EPC contract between Vinacomin and China’s KAIDI Electric Power Co. Ltd. signed on July 7, 2009. The total project investment equal to $577 million was financed by 20% equity and 80% debt. The purpose of the project was to construct a 440MW coali-fired power plant — with two, 220MW power generation units (Unit 1 and Unit 2) — that uses circulating fluidized-bed technology in Bình Khê commune, Đông Triều district, Quảng Ninh province. KAIDI Electric Power Co. was the main EPC contractor but Wuhan KAIDI Electric Power Engineering Company and WULFF (a German firm) helped implement the project. Construction commenced on July 8, 2009. Unit 1 became operational in October 2012, and Unit 2 became operational in January 2013. On April 12, 2013, the project was officially completed. Since the plant started operating, residents in nearby Đông Sơn and Xuân Bình hamlets say that their lives have been negatively affected by the plant's operations. Vu Thanh An, the Party secretary of Đông Sơn, said that the plant had begun dumping pollutants into the Cấm River within days of beginning operations. Le Ba Cai, a resident of Đông Sơn who lives only 500 meters from the plant, said that strong shaking from the plant's operations had cracked the walls of his house. Another resident, Ngo Thi Nhi, said coal dust covered her house every day, and that she heard loud explosions each night.

Additional details

1. This project is also known as the 2x220 MW Mao Khe 1 and 2 coal-fired power plants and the 440MW Mao Khe Thermoelectric Power Plant Project. The Chinese project title is 凯迪电力越南冒溪热电厂. The Vietnamese project title is Dự án Nhiệt điện Mạo Khê or Dự án NMNĐ Mạo Khê. 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.

Number of official sources

5

Number of total sources

25