China Eximbank provides RMB 710 million overseas investment loan for Palembang Timur 150MW Gas-fired Power Plant Construction Project

Project narrative

In 1996, PT Asrigita Prasarana, a subsidiary owned through PT Astratel. Nusantara (“Astratel”), entered into a Power Purchase Agreement with Persero — Indonesia’s state-owned power utility — for PT Asrigita Prasarana to design, finance, construct, own and operate the Palembang Timur 150MW Gas-fired Power Plant. However, due to unfavorable economic conditions in the country, the implementation of the project was postponed. Then, in March 2003, China Eximbank provided an RMB 710 million overseas investment loan to China National Chemical Engineering Co., Ltd. (CNCEC) for the the Palembang Timur 150MW Gas-fired Power Plant Construction Project. One month later, in April 2003, a consortium consisting of China National Chemical Corporation (CNCC) and Chengdu Engineering Corporation of China (CECC) acquired an 85% ownership stake in PT Asrigita Prasarana, a special purpose vehicle that is legally responsible for designing, implementing, and financing the Palembang Timur 150MW Gas-fired Power Plant Construction (IPP) Project on a BOOT basis. CNCEC on-lent the proceeds of the overseas investment loan to PT Asrigita Prasarana. The borrowing terms of the loan are unknown. However, it is known that Sinosure provided an insurance policy. The purpose of the project was to construct the Palembang Timur 150MW Gas-fired Power Plant in South Sumatra Province. CNCEC and CNCC were the contractors responsible for project implementation. Construction began in September 2003. The power plant was connected to the power grid on August 31, 2004 and officially inaugurated by Indonesia’s President on November 9, 2004.