China Development Bank provides $119.3 million buyer’s credit loan to 100MW Nam Lik 1-2 Hydropower Project (Linked to Record ID#63104)

China Development Bank provides $119.3 million buyer’s credit loan to 100MW Nam Lik 1-2 Hydropower Project On May 5, 2006, China International Water & Electric Corporation (CWE) and the Lao Government signed a Nam Lik 1-2 Hydropower Project Development Agreement. Then, on October 30, 2006, China’s National Development and Reform Commission approved the project.

On November 19, 2006, CWE and EDL-Generation Company Limited (EDL-Gen) signed a Shareholder Agreement (SA) and the Power Purchase Agreement (PPA) for the 100MW Nam Lik 1-2 Hydropower Project.

Then, on April 2007, China’s Ministry of Commerce obtained the approval of the establishment of Nam Lik 1-2 Power Company Limited, a special purpose vehicle and joint venture between CWE (80% ownership stake) and EDL-Gen (20% ownership stake).

On November 24, 2008, China Development Bank and Nam Lik 1-2 Power Company Limited signed a $119,300,000 buyer’s credit loan agreement for the 100MW Nam Lik 1-2 Hydropower Project (captured in Record ID#33790).

The borrower purchased buyer’s credit insurance from Sinosure.

The $149.2 million project was implemented on a build–own–operate–transfer (BOOT) basis and financed according to an 80:20 debt-to-equity ratio. The equity contribution from CWE is captured in Record ID#63104. CWE signed a 30-year concession agreement with the Government of Laos on October 31, 2006.

According to the agreement, CWE will transfer the project to the Lao government after a 4.5-year construction period and 25-years of operation.

All the power generated from the Nam Lik 1-2 Hydropower Project is to be supplied to EDL in accordance with a Take-or-Pay commitment over a 25-year period.

The Nam Lik 1-2 Hydropower Project is located on the Nam Lik River, about 50km upstream of the Nam Lik Bridge of Road No.13 at B.HinHeup, northwest of Vientiane city. The approximate coordinates of the project site are: 18.7897°N, 102.1233°E.

The project is a diversion hydropower station with an designed installed capacity of 100 MW (100,000 kW) (2 Units x 50 MW), an average annual power generation of 435 million kWh, and an initial electricity price of 4.68 cents/kWh.

Construction activities included a concrete faced rock-fill dam, auxiliary dam, over-year regulation reservoir, spillway tunnel, flood discharge tunnel, diversion system, power house and transmission system.

The power generated by the two 50 MW generators were to be supplied to Ban Don substation and Hin heup substation through 115kV transmission lines respectively and then distributed in Lao Power Grid.

According to CWE, a groundbreaking ceremony was held on December 21, 2007, and a power generation ceremony was held on August 29, 2010.