[China-Venezuela Joint Fund] China loans USD 840 million for construction of Planta Centro Power Plant (linked to project ID#58677, #37833, #37804, and #37808)
Summary
Funding agency [Type]
China Development Bank (CDB) [State-owned Policy Bank]
Recipient
Venezuela
Sector
Energy (Code: 230)
Flow type
Loan
Level of public liability
Other public sector debt
Infrastructure
Yes
Category
Project lifecycle
Geography
Description
In 2010, USD 5.4 billon from the China-Venezuela Joint Fund Long Term Facility (see project ID#37804, and #37808) was allocated to constructing power plants (see project ID#37833). On December 23, 2010, CMEC and Corpoelec signed a contract for the construction of 600 MW for the Planta Centro power plant (Spanish: Termoeléctrica Planta Centro, Chinese: 中央电厂). Construction began May 31, 2012. In March of 2015, CMEC organized a training in China for 30 Venezuelan technicians to learn how to run the plant. The handover ceremony occurred on May 18, 2016. CMEC was the implementing agency for Unit 6 of the plant. Units 1, 2, 3, 4, and 5 were built in 1978, 1982, 1982, and 2015, respectively. Unit 6 was the only unit constructed with this loan. The 600 MW steam generation unit built for this plant is one of the largest in South America. Despite the new unit, the plant was only producing at 12.8% capacity in 2016. There was a difference of USD 672 million between the advertised cost and the actual cost. This was an overcharge of 125%. A lawsuit in Andorra over bribes paid by Chinese contractors to Venezuelan ministers alleged that CMEC secured the contract with a USD 55 million bribe. By 2019, the plant was not producing at all. Efforts were being made to revive the plant beginning in 2019. The Bolivarian Militia was deployed to the plant for weeding and plant control, and to defend the plant against "saboteurs".
Additional details
1. This project is linked to project ID#58677, which represents the China-Venezuela Joint Fund, and project ID#37833, which is an umbrella project representing power plants pledged as part of the long-term joint facility. It is unclear if the funding came from the USD or RMB facility, so no interest rate is recorded. 2. No transaction amount is included because the funding for this project is already detailed in #37833. 3. According to CMEC, the contract was signed on December 23, 2010, and construction started on May 31, 2012. According to Corpoelec, construction started in January 2013. According to the National Assembly, the contract was signed in 2013. AidData uses the dates from CMEC.
Number of official sources
9
Number of total sources
12
Details
Cofinanced
No
Direct receiving agencies [Type]
Banco de Desarrollo Económico y Social de Venezuela (BANDES) [State-owned Bank]
China-Venezuela Joint Fund [State-owned Fund]
Implementing agencies [Type]
China Machinery Engineering Corporation (CMEC) [State-owned Company]
CORPOELEC [State-owned Company]
Bolivarian Militia of Venezuela [Government Agency]
China-Venezuela Joint Fund [State-owned Fund]
Collateral provider [Type]
Pétroleos de Venezuela S.A. (PDVSA) [State-owned Company]
Collateral
Venezuela undertakes through PDVSA to sell fuel and / or crude oil in accordance with the oil contract (s) to ChinaOil in quantities not less than 230,000 barrels per day, by the date on that the obligations assumed with respect to the facilities have been completed and unconditionally fulfilled by BANDES; ChinaOil will deposit the money for the purchase of crude oil and fuel directly into the collection account opened and maintained by the BANDES and CDB.