Completed Mixed AidData Chinese Aid

Bank of China provides $85 million buyer's credit loan for Falcon State Water Pipeline Project (Linked to Record ID#35849)

$85M USD

Funder	Bank of China (BOC)
Recipient Organization	Government of Venezuela
Country	Venezuela
Start Date	Dec 23, 2002
End Date	May 11, 2029
Duration	9,636 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`35875`

Grant Description

Bank of China provides $85 million buyer's credit loan for Falcon State Water Pipeline Project On December 23, 2002, Bank of China signed a buyer's credit loan agreement with the Government of Venezuela to provide a $85 million buyer’s credit loan for Phase 1 of the Falcon State Water Pipeline Project.

China Export & Credit Insurance Corporation (Sinosure) provided buyer's credit insurance. The maturity of the loan was to be 9.5-years. An MOU for the project was signed December 27, 2001.

The commercial contract cost for phase I was $100 million, of which $85 million was provided via the BOC buyer's credit loan, and the remaining 15% was to be covered by the Government of Venezuela. The commercial contract cost for phase II was $80.3 million. The phase II supplementary engineering contract for phase II had a value of $12.5 million.

The commercial contract for phase III was worth $108.05 million.

The total cost for all phases was originally estimated to be $240 million, but project costs ultimately exceeded that amount. CAMCE was the contractor responsible for project implementation. This project was launched on June 8, 2003, and it was completed on May 29, 2006.

Phase I involved a feasibility study, engineering and construction of 60 km of pipes to take 8,000 l/s of water from the Maticora reservoir in the south of Falcon state to the Paraguana peninsula in the north, benefiting some 150,000 people. The contract was signed on July 3, 2002 and the work came into use on June 5, 2003.

The contract for Phase II was signed on June 22, 2005, and it consisted of provision of 37km of steel pipes and 20km of PEAD pipes, installation work, and the construction of three water treatment plants with capacities of 16 1/s, 100 l/s, and 100 l/s. The contract for supplementary engineering work for phase II was signed on August 20, 2006.

The Phase III contract was signed on March 8, 2007 and involved the supply of 59 km of steel pipes and installation work. The project has resulted in much controversy. Due to poor engineering the pipeline does not continuously function, leaving communities without water.

In addition, there has been allegations of corruption, citing the money allocated towards the project is greater than the amount actually needed.

📋 Staff Comments

Sources differ on the face value of the loan. The CAMCE's IPO Prospectus identifies an $85 million buyers credit with a maturity of 9.5-years (see '首次公开发行股票招股说明书', page 184). CAMCE's 'Development History' page says that Bank of China provided a loan of $240 million (see '发展历程' under the 2001 tab).
This project is called '玻利瓦尔供水项目' or '委法尔肯州输水管道项目' in Chinese and 'Acueducto Bolivariano del estado Falcón' in Spanish.

📚 Sources & References

Falcon aqueduct project moves forward.
中工国际工程股份有限公司委内瑞拉法肯州输水项目进展情况公告
委内瑞拉法肯州输水工程
Water Transmission Project in Falcon
Venezuela
中国在拉美最大的买方信贷工程项目-委内瑞拉法肯州输水工程正式启动
中工国际工程股份有限公司委内瑞拉法肯州输水项目进展情况公告
委内瑞拉法肯州输水工程项目二期合同签署
中工国际工程股份有限公司
委内瑞拉法肯州输水工程项目
首次公开发行股票招股说明书
中工國際工程股份有限公司
工程贷款造句
中工國際
查韦斯总统宣布由中方承建的委法尔肯州输水管道项目正式启动
Falcon aqueduct financing guaranteed
China to provide US$100mn for Falcon aqueduct
发展历程
Intervención del Comandante Presidente Hugo Chávez, en la Inauguración de planta potabilizadora de agua.
Falcón El estado más seco
Acueducto Bolivariano, la gran estafa del chavismo a sedientos habitantes de Falcón
El chavismo pidió acuerdos regionales contra la corrupción: un diputado opositor propuso investigar las obras inconclusas en Falcón
Graterol: 23 millones de dólares se perdieron con el acueducto bolivariano en Falcón
Las falsas obras millonarias con las que el chavismo engañó a Falcón
Falcón │Punto Fijo es la ciudad con peor servicio de agua como consecuencia de la corrupción 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.