A view of the Lai Chau Hydro-power plant. The Electricity of Viet Nam yesterday signed a VND14.5 trillion (US$690.47 million) credit contract with banks to make sure construction remains on schedule. — VNA/VNS Photo Ngoc Ha

HA NOI (Biz Hub)— A credit contract worth VND14.5 trillion (US$690.47 million) was co-signed in Ha Noi yesterday for the Lai Chau Hydro-power project in northern Lai Chau Province.

The agreement was signed by Vietcombank, Vietinbank, BIDV and Agribank with Electricity of Viet Nam (EVN).

Speaking at the signing ceremony, EVN general director Pham Le Thanh said the group needed VND100 trillion ($4.65 billion) each year to invest in electric projects.

"The credit agreement would facilitate the hydro-power project, especially after investors had struggled to access to loans," Thanh said, adding that the loan would help the project stay on schedule.

He said the banks had already loaned EVN VND40 trillion for power projects.

"For years, Vietcombank has helped EVN to arrange credit provision to meet the capital requirements for large power projects, and provided other banking services," said Nguyen Hoa Binh, chairman of Vietcombank's management board.

The plant is on the Da River in Muong Te District, and preparatory work to block off the river began in early 2011.

EVN is the main investor in the 1,200MW project, worth VND35.7 trillion ($1.8 billion). It will be the third biggest power plant in Viet Nam, just behind Son La and Hoa Binh.

The first turbine is expected to be put into operation in early 2016.

The plant is expected to provide an average of 4,670 million kWh of electricity annually.

The project will also improve irrigation in downstream areas, especially in the dry season, as well as other socio-economic factors in Lai Chau Province. — VNS