Korea Eximbank’s Deputy Director Hong handing Petro Vietnam’s General Director Son a model of the power plant at the signing ceremony. The credit loan by Korea Eximbank and other investors is much needed by Petro Vietnam to complete the Song Hau 1 Thermal Power Plant project in time. — Photo oilgas.vn
Vietnam National Oil and Gas Group (PetroVietnam) on November 23 signed a contract with the Export-Import Bank of Korea (Korea Eximbank) for funding the Song Hau 1 thermal power project.
Under the contract, PetroVietnam is also taking loans from nine other foreign commercial banks, in an arrangement made by Citibank US.
The contract is valued at US$1.2 billion, with credit insurance provided by the Korea Trade Insurance Corporation (K-Sure) and the Korean export credit contract provided by Korea Eximbank.
The project requires a total investment of $2.05 billion, of which 70 per cent, an estimated $1.43 billion, will be in loans. PetroVietnam has arranged for a Korean export credit agency loan of $987 million with a 17-year term, and another international trade loan of S213 million that has a 10-year term.
Young-Pyo Hong, deputy president of Korea Eximbank, expressed his confidence in the project at the signing ceremony, while Nguyen Vu Truong Son, general director of Petro Vietnam, appreciated the co-operation between his company and foreign banks.
The Song Hau 1 thermal plant project, with the capacity to generate 1,200MW (with two units of 600MW), will be spread over 115 hectares in southern Hau Giang Province. One of the key projects approved by the prime minister, it is part of the national power master plan VII, which aims to construct power plants between 2013 and 2020 to meet the rising demand in southern Viet Nam.
PetroVietnam’s experience with major power projects such as Vung Ang 1, Thai Binh 2, Ca Mau 1 and 2, Nhon Trach 1 has helped it successfully negotiate and arrange loans with international banks within a period of one year.
Sơn and Hong expressed hope that in the future, PetroVietnam and Korea Eximbank would have the opportunity to work together. Completed on time, this project will provide Việt Nam with much-needed electricity and contribute to regional economic development.
Also present at the ceremony were members of PetroVietnam’s board of directors, representatives from the Song Hau 1 power project management board and officials from Korean Eximbank, K-Sure and Citibank. — VNS