Bank of China contributes to $350 million tranche of $771 million syndicated dual-currency loan for 1.4GW Combined Cycle Hin Kong Power Plant Project

Bank of China and ICBC contributions to $350 million tranche of $771 million syndicated dual-currency loan for 1.4GW Combined Cycle Hin Kong Power Plant Project On August 19, 2022, Hin Kong Power Company Limited — a special purpose vehicle and joint venture of Ratch Group Public Company (51% ownership stake) and Gulf Energy Development Public Company (49% ownership stake) — signed a $771.03 million, dual-currency syndicated loan agreement with a group of Chinese and non-Chinese banks for the 1.4GW Combined Cycle Hin Kong Power Plant Project.

Participants in the $350 million dollar tranche include Bank of China, ICBC, Mizuho, SMTB Singapore, Natixis, Societe Generale, Standard Chartered and OCBC.

Participants in the THB 14.05 billion baht tranche include Bank of Ayudhya, Bangkok Bank, Government Savings Bank, Siam Commercial Bank, SMBC, and SMTB Thailand. Bank of China contributed $42.86 million to the $350 million tranche.

The purpose of the project is to construct a 1.4GW gas-fired power plant worth about $1.27 billion in the Hin kong sub-district of the Muong District and Ratchaburi Province. The power plant is expected to consist of two combined-cycle generating units of 700MW capacity each. Each unit is expected to be equipped with a M701 JAC gas turbine from Mitsubishi Heavy Industries (MHI).

The M701 JAC gas turbines measure 16.7m-long, 6.5m-wide, and 6.9m-high. The power plant adopts air cooling for combustors with a turbine inlet temperature of 1,600ºC. It comes with a 15-stage compressor with an air-cooled combustor having 22 cans. The four-stage turbine is equipped with a single rotor with a rated speed of 3,000 rotations per minute (rpm).

The Electricity Generating Authority of Thailand (EGAT), the offtaker, provided a guarantee on the gas supply (under a 25-year PPA) — a feature that comforted the lenders.

At full capacity, the gas-fired power generation facility is expected to offset up to seven million tonnes (Mt) of CO2 emissions a year.

However, the project has attracted criticism from environmental groups, which claim it is an unnecessary fossil-fueled power project given Thailand has an existing surplus of electricity.

Consultants of Technology carried out the second public participation meeting for the revised draft environmental impact assessment (EIA) report of Hin Kong power project in October 2019.

The EIA report of the Hin Kong power project was approved by Thailand’s Natural Resources and Environmental Policy and Planning Office in July 2020.

A consortium of MHI Power Project (Thailand) Company, Sino-Thai Engineering & Construction Public Company and Mitsubishi Power Company was awarded a full turnkey engineering, procurement and construction (EPC) contract in September 2020.

Mitsubishi Heavy Industries, which will supply the gas turbines, also signed a 25-year long term service agreement (LTSA) for the power plant in the same month.

The construction works on the project were originally expected to be started in June 2021 with the commissioning of units one and two scheduled by March 2024 and January 2025, respectively. Unit 1 commenced its commercial operations on March 1, 2024. At that time, Unit 2 had made significant progress, achieving a 96.5% completion rate.