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ICBC contributes $84.6 million to syndicated buyer’s credit loan for 990MW Jabar Indramayu Power Plant Construction Project (linked to Record ID#38606, #100703, #100704, #100705)
| Funder | Industrial and Commercial Bank of China (ICBC) |
|---|---|
| Recipient Organization | PT Perusahaan Listrik Negara (Persero) (PLN) |
| Country | Indonesia |
| Start Date | May 27, 2008 |
| End Date | Dec 07, 2030 |
| Duration | 8,229 days |
| Number of Grantees | 1 |
| Roles | Recipient |
| Data Source | AidData Chinese Aid |
| Grant ID | 100701 |
Grant Description
Bank of China, CDB, China CITIC Bank, CCB, and ICBC contributions to 592 million USD syndicated loan for 990MW Jabar Indramayu Power Plant Construction Project On May 27, 2008, Perusahaan Listrik Negara (PLN) — an Indonesian state-owned electricity company — signed a $592 million syndicated buyer’s credit loan agreement with a group of Chinese and non-Chinese banks for the the 990MW Jabar Indramayu Power Plant Construction Project.
The final maturity date of the loan is May 27, 2021. The borrower purchased buyer’s credit insurance from Sinosure, covering 95% of the loan. Indonesia’s Ministry of Finance also issued a sovereign guarantee in support of the loan.
Members of the loan syndicate included Bank of China, BNP Paribas, China Construction Bank, China Development Bank, ICBC, Société Générale, China Citic, ANZ Bank, Bayerische Landesbank, Calyon, Credit Suisse, Fortis, ING, Natixis, RBS, WestLB, Mizuho, and Sumitomo Mitsui Banking Corporation (SMBC).
Bank of China, China Construction Bank, China Development Bank, ICBC, and China Citic jointly contributed an estimated $423 million.
Record ID#38606 captures the estimated financial commitment of Bank of China, Record ID#100701 captures the estimated financial commitment of ICBC, Record ID#100703 captures the estimated financial commitment of China Development Bank, Record ID#100704 captures the estimated financial commitment of China Construction Bank, and Record ID#100705 captures the estimated financial commitment of China CITIC Bank.
The proceeds of the loan were to be used by the borrower (PLN) to finance 85% of the cost of a $696.73 million commercial (EPC) contract. The remaining 15% of the contract cost was to be provided in local currency financing arrangements by Indonesian banks.
The purpose of the project was to construct a 3x330 MW coal-fired steam power plant on a 83-hectare site in Sumur Adem Village, Sukra District, Indramayu Regency, West Java Province (exact locational coordinates: -6.2747375, 107.9704303).
The power plant required the installation of three 1050t/h subcritical boilers and three 330MW turbo-generator units, which were to be cooled down directly by seawater.
China National Machinery Industry Corporation, the China National Electric Equipment Corporation and PT Penta Adi Samudera were the contractors responsible for implementation. Construction began in 2007.
The 1st and 2nd unit of the 3x330MW power plant started commercial operations in January 2011 and May 2011, respectively, while the 3rd unit passed performance testing in September 2011. The plant officially opened on October 12, 2011.
It was part of the fast-track program by Indonesian government to add power plants around the country, which total to about 10000 MW. In December 2014, Indramayu Regency officials alleged that a former Regency government official, Irianto M.S.
Syafiuddin, had embezzled 4.1 billion Rupiah, or about $300,000, in the land acquisition process for the Indramayu plant in 2004. Since its completion, there has been significant local opposition to the Indramayu plant.
Smoke and toxic waste produced by the plant has affected the livelihoods of residents in the surrounding communities by diminishing crop yields and catches of shrimp and fish significantly, threatening the main source of income of local farmers and fisherman. Additionally, smoke plumes from the plant’s chimney have caused respiratory issues among those living near the plant.
Moreover, a 2000MW expansion of the power plant was announced in 2015.
However, due to persistent protesting by Indramayu residents and efforts to accelerate the global phase-out of coal, the Japanese International Development Agency (JICA), who was to finance the expansion, withdrew from funding the project.
Staff Comments
- This project is also known as the 990MW PLTU 1 Jabar Indramayu Power Plant Project and the Indramayu Sumuradem Power Station. The Chinese project title is 印度尼西亚INDRAMAYU 3X330 MW火力发电项目.
- According to IJGlobal, each of the Chinese state-owned financiers provided $84.6 million, for a total of $423 million ($84.6 million x 5 = $423 million) from Bank of China, China Construction Bank, China Development Bank, ICBC, and China Citic. The transaction amount has been recorded as $84.6 million each for all five Chinese banks included in the syndicate.
- In the Overseas Development Finance Dataset that Boston University’s Global Development Policy Center published in December 2020, it identifies this project as being supported by a $562 million China Development Bank loan. However, this estimate seems implausible given that there were 18 members of the loan syndicate (including four additional Chinese state-owned banks).
- Chinese construction began roughly three years after former Regency government official Irianto M.S. Syafiuddin allegedly embezzled funds during the plant's land acquisition process. The syndicated loan facility was secured about four years after the incident. For these reasons, AidData does not consider the alleged embezzlement indicative of a governance risk related to Chinese involvement.
Sources & References
- PLN secures Chinese loans for power plants program after Merpati spat solved
- Conditionality in Chinese bilateral lending
- Power Loans Tied Up Over Merpati
- PLN secures part of the loans needed for 10,000 MW program
- Govt to deal with China loan problems of Merpati and PLN
- RI resolves rifts with China, mends ties
- PLN to secure $761m in loans from Chinese banks in June
- Funding Spat Puts the Brakes On Fast-Track Power Project
- PLN Hopes to Secure ‘Fast-Track’ Funds From China Despite Financing Freeze
- PLN to Borrow $761m From China for Fast-Track Program
- PLN secures final financing needed for first 10,000 MW power plant crash program
- Indonesia: Chinese financing in PLN's 'fast-track' program
- Indramayu power station
- Chinese firms power on with Indonesia plan
- Introduction to Large-scale Fossil-fired Power Generation & Operation Contract Projects 1)
- PLTU #1 West Java – Indramayu Has Been Operate
- Java-Bali Electricity System Secured
- The Completion Ceremony of INDRAMAYU 3×330MW Coal-Fired Power Plant
- Indramayu 3x330MW Coal-fired Power Plant Crowned with Complete Succes
- Best Deals of 2008: PLN Indramayu
- Coal News Related Industries Macro Economy Bank of China to finance Indonesia's power plants
- Indramayu fires up new coal power plant
- 印尼INDRAMAYU 3×330MW燃煤电站项目竣工典礼圆满结束
- 西北发电公司海外业务实现跨越式发展 将兴建西爪3X33万千瓦电力大工程
- 为印尼电站建设提供超14亿美元资金 中国银行印尼南安由及龙湾电站贷款项目 荣获国际颁发“全球最佳交易奖”
- 国电再获中国庞大贷款 中国银行提供5.92亿美元协建南安由发电站
- 承建印尼3X330MW 燃煤电站项目竣工
- 澳新银行助力中资企业走出去
- PLN Minta Tambahan Dana Proyek 10.000 MW
- PLN Dapat Pinjaman US$592 Juta dari BOC
- Indramayu Coal-fired Power Plant, 2011 Bond Prospectus
- 中行获2008年度“最佳融资银行”奖
- Supplementary Online Material: List of projects to which China has provided public financing (2007-2013)
- PLN signs $615m loan deals, workers continue rally
- Loan week
- April 18-24
- Loan week
- April 11-17
- Indramayu power station
- Indramayu Coal Power Plant
- West Java
- Indonesia
- PLTU Indramayu
- Masyarakat JATAYU: Tutup PLTU Indramayu 1 Agar Kami Bisa Hidup di Tanah yang Subur
- Nestapa Warga Indramayu: Terancam Polusi & Tergusur Akibat PLTU
- Free Sawin And Sukma Stop The Environmental Criminalization
- The Persistence of the Jatayu Community in Demanding the Closure of the Indramayu PLTU, from Criminalization to International Support
- Panen Bawang Merah di Area PLTU Indramayu
- Request No More Japanese Support and Loan in Any kind of Form for Indramayu Coal-fired Power Plant Expansion Project
- West Java
- Indonesia Loan applications and disbursements are still being received and processed as the projects continue to evolve. Ongoing monitoring and evaluation are in place to ensure project continuity.
All Grantees
PT Perusahaan Listrik Negara (Persero) (PLN)
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