Skip to content
AidData logo

Overview

[China-Venezuela Joint Fund] CDB provides loan for Termo Carabobo II Power Plant (Linked to Record ID#58677)

Commitment Year•2010Country of Activity•VenezuelaDirect Recipient Country of Incorporation•VenezuelaSector•EnergyFlow Type•Loan

Status

Project lifecycle

Completion

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Jan 1, 2010
End (actual)
Apr 15, 2014

Geospatial footprint

Map overview

Visualizes the AidData-provided feature geometry for this project.

Loading map…

CDB provides loan for Termo Carabobo II Power Plant. More detailed locational information can be found at https://www.openstreetmap.org/way/802192831

Stakeholders

Organizations involved in projects and activities supported by financial and in-kind transfers from Chinese government and state-owned entities

Ultimate beneficial owners

At least 25% host country ownershipAt least 25% Chinese ownership

Funding agencies

State-owned Policy Banks

  • China Development Bank (CDB)

Receiving agencies

State-owned Banks

  • Banco de Desarrollo Económico y Social de Venezuela (BANDES)

State-owned Funds

  • China-Venezuela Joint Fund

Implementing agencies

State-owned companies

  • CORPOELEC
  • Pétroleos de Venezuela S.A. (PDVSA)
  • Sinohydro Corporation Limited

State-owned Funds

  • China-Venezuela Joint Fund

Collateral providers

State-owned companies

  • Pétroleos de Venezuela S.A. (PDVSA)

Loan desecription

[China-Venezuela Joint Fund] CDB provides loan for Termo Carabobo II Power Plant

Interest rate (t₀)•1.72%Interest type•Fixed Interest Rate

Collateral

The borrowing was collateralized with PDVSA income from daily oil sales (in quantities not less than 230,000 barrels per day) to China National United Oil Corporation (ChinaOil), which was deposited in a collection (escrow) account at China Development Bank (CDB). Banco de Desarrollo Económico y Social de Venezuela (BANDES) opened and maintained a USD-denominated collection (escrow) account with CDB into which all proceeds from oil export sales -- under an offtake agreement (petroleum sales and purchase contract) between PDVSA and ChinaOil -- were deposited for the purposes of (a) making regular debt service payments to CDB, and (b) maintaining a minimum cash collateral balance. The borrower was required to maintain a minimum cash balance in the collection (escrow) account equivalent to no less than 1.3 times the aggregate amount of principal, interest, and any other amount due during the next repayment period. If the minimum cash balance was not maintained, then PDVSA would be responsible for increasing the amount of fuel and/or crude oil to be delivered under the petroleum sales and purchase contract to ensure that (a) the actual debt service coverage ratio was maintained at the required level at the required times; and (b) the amount in the New Collection Account was sufficient to meet the required balance requirements set out in the facility agreement. If PDVSA did not do so, then BANDES was responsible for transferring funds to the CDB-controlled bank account to 'remedy any shortfall.' The lender also had the ability to block the debtor from withdrawing the funds.

Narrative

Full Description

Project narrative

The TermoCarabobo II coal-fired power plant cost #1.116 billion. The project has a capacity of 680 MW. It was built by Sinohydro in conjunction with Corpoelec and PDVSA. The plant was completed on April 15, 2014. An additional phase worth USD 880 million to add an additional 320 MW was being contemplated at the time of the completion. It seems that this addition did not actually occur. A 2019 Andorran lawsuit alleged that Sinohydro bribed the cousin of the former president of the PDVSA to give them the the TermoCarabobo II contract. It was also alleged that Sinohydro overcharged for the plant by USD 620 million). It seems that the plant stopped fully functioning at some point between its opening and 2022, because efforts are currently underway to "rehabilitate" the plant. The goal was to repair each of the plants four 150 MW generators to bring the capacity to 600 MW. As of May 4, 2022, the third unit was 63% complete.

Staff comments

1. This project is not the same as TermoCarabobo I, also known as El Palito, which is captured by Record ID#91257. Researchers should be aware that they are located near each other, have the same contractors, and have similar names. TermoCarabobo I has a capacity of 772 MW while TermoCarabobo II has a capacity of 680. 2. This project is linked to the China-Venezuela Joint Fund (#58677) 3. The commitment year is unclear. In 2010, Venezuela allocated USD 5.5 billion from the China-Venezuela joint fund to the construction of power plants (see Record ID#37833). This project may be part of that initiative given the construction start date and the inclusion of TermoCarabobo I in that project, but this project was not mentioned in the sources. 4. No transaction amount is given because it is captured in the China-Venezuela joint fund project. 5. "Expensive Scams" gives the total project cost as USD 1,273,700,000. The more conservative 1.116 billion amount provided by the government of Venezuela in "Planta Termocarabobo II generará 680 MW y estabilizará al SEN" was used.