Completed Mixed AidData Chinese Aid

China Eximbank contributes to syndicated buyer's credit loan for Unit 2 of 220 MW Sirajganj Combined Cycle Power Plant Project (Linked to Record ID#69033)

$119.42M USD

Funder	Export-Import Bank of China (China Eximbank)
Recipient Organization	North-West Power Generation Company Limited (NWPGCL)
Country	Bangladesh
Start Date	Aug 01, 2015
End Date	Aug 03, 2031
Duration	5,846 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`56541`

Grant Description

China Eximbank contributions to USD 200.03 million syndicated buyer's credit loan for Unit 2 of 220 MW Sirajganj Combined Cycle Power Plant Project In August 2015, North-West Power Generation Company Limited (NWPGCL) — a state-owned power company in Bangladesh — signed a $200.03 million syndicated buyer's credit loan agreement with a group of Chinese and non-Chinese lenders (including Standard Chartered Bank, the Export-Import Bank of China, and Siemens Bank) for Unit 2 of the 220MW Sirajganj Combined Cycle Power Plant Project.

📋 Loan / Grant Terms

💰 Loan Amountwith a maturity of 15 years and a grace period of 3 years

The loan was scheduled for repayment (beginning in August 2018) in 24 semi-annual installments.

The loan was backed by a sovereign repayment guarantee and split into 3 tranches: a Sinosure-insured loan tranche, a Euler Hermes-insured tranche, and a MIGA-insured tranche. It was also collateralized against a mortgage over the power plant assets.

The Euler Hermes-insured tranche carried an interest rate of 6-month LIBOR plus a 1.95% margin, while the Sinosure-insured tranche carried an interest rate of 6-month LIBOR plus a 3.26% margin and the MIGA-insured carried an interest rate of 6-month LIBOR plus a 1.9% margin. The Sinosure-insured loan tranche disbursed $119,424,457 as of June 30, 2021.

The Euler Hermes-insured loan tranche disbursed $32,288,027 as of June 30, 2021. The MIGA-insured loan tranche disbursed $39,044,768 as of June 30, 2021.

The loan had achieved a 95.3% disbursement rate ($190.75 million out of $200.03 million) as of June 30, 2020 and June 30, 2021.

The borrower (NWPGCL) was expected to use the proceeds of the loan to partially finance an Engineering, Procurement and Construction (EPC) contract that it signed with a consortium consisting of China National Machinery Import & Export Corporation (CMC) and Fujian Electric Power Survey & Design Institute (FEDI) on July 12, 2015.

The purpose of the project was to construct the second power generation unit (Unit 2) of the 220 MW Sirajganj Combined Cycle Power Plant.

More specifically, the project involved the installation of one gas turbine generator (GTG) capable of operating on natural gas and/or High-Speed Diesel (HSD), one Gas Booster Compressor, one heat recovery steam generator (HRSG), evaporators, cooling towers, main and bypass stacks connected to a steam turbine Generator (STG) of condensing type for indoor installation, condensate and feed water system, cooling water system and auxiliary equipment.

The project site is located about 15 km southeast of Sirajganj town and 135 km northwest of Dhaka on the western bank of the River Jamuna.

It is located in Khas Barashimul Mouza in the Saidabad Union of Sirajganj Sadar Upazilla (sub-district) of Sirajganj District.

The closest settlements to the project site, Boroshimul and Ponchosona, are both located approximately 1 km from the complex.

China National Machinery Import and Export Corporation (CMC) was the EPC contractor responsible for overall project management. FEDI was responsible for providing technical expertise, including concept design and basic engineering. Unit 2 of the 220 MW Sirajganj Combined Cycle Power Plant was successfully connected to the grid on August 2, 2017.

The project achieved its commercial operation date (COD) on February 5, 2018.

A Final Acceptance Certificate (FAC) was issued by the project owner on October 24, 2021, which marked the end of the warranty period.

📋 Staff Comments

This project is also known as the Sirajganj 225MW CCPP Project (Dual Fuel- 2nd Unit) Project. The Chinese project title is 作的孟加拉希拉甘杰电站二期225MW联合循环电厂项目 or 公司孟加拉希拉甘杰225MW联合循环电站2号机组 or 孟加拉国希拉甘杰220MW联合循环电站项目.
For official evidence that China Eximbank participated in the syndicated loan for Unit 2 of 220 MW Sirajganj Combined Cycle Power Plant Project, see http://english.eximbank.gov.cn/News/AnnualR/2015/201807/P020180718662824748870.pdf and http://www.eximbank.gov.cn/aboutExim/annals/2015/201806/P020180612449684068720.pdf.
China Eximbank is the only known participant in the Sinosure-insured loan tranche. As such, AidData assumes for the time being that China Eximbank’s total contribution to the syndicated loan was equivalent to the total amount that was disbursed through the Sinosure-insured loan tranche (see pg. 33 of https://nwpgcl.gov.bd/sites/default/files/files/nwpgcl.portal.gov.bd/annual_reports/803874aa_9969_4e9e_9538_bd03fbb56d2d/2021-12-22-08-17-bfed57f9db82d29e5e6611ee4ab4d45c.pdf). This issue warrants further investigation.
For loan and debt rescheduling records with variable interest rates, AidData calculates the all-in interest rate at T0 based on the reference rate (such as LIBOR or EURIBOR) on the loan start date, plus any known margin. Please see the methodology for additional details.
North West Power Generation Company Limited (NWPGCL)is a state-owned power generation utility that is a 100% wholly owned subsidiary of the Bangladesh Power Development Board (BPDB), which was incorporated in 2007.
As of February 2023, the 2015 loan for this project was not captured in the China’s Global Energy Finance (CGEF) Database or the China's Overseas Development Finance (CODF) Database published by Boston University’s Global Development Policy Center.
Evidence of the issuance of a sovereign guarantee is provided on the Ministry of Finance website (https://mof.portal.gov.bd/sites/default/files/files/mof.portal.gov.bd/page/e9e8a8c8_8a8b_4536_a18b_fc5ca696650a/St_6a1_en.pdf).
Sirajganj 3 was supported by a syndicated loan that included the provision of debt from the Bank of China (as captured via Record ID#69033).
The Multilateral Investment Guarantee Agency (MIGA) is a member of the World Bank Group. MIGA provides political risk insurance (guarantees) for projects in a broad range of sectors in developing member countries, covering all regions of the world.
For evidence of a mortgage over the power plant assets, see NWPGCL's 2023 Annual Report (https://nwpgcl.portal.gov.bd/sites/default/files/files/nwpgcl.portal.gov.bd/annual_reports/7f1e1d44_cd43_4962_ba9f_2c477102f0ee/2023-11-26-09-37-2f1f8f59f921ab08e3282d6a2e18d80b.pdf).

📚 Sources & References

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THE EXPORT-IMPORT BANK OF CHINA ANNUAL REPORT 2015
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Increasing Foreign Direct Investment through Political Risk Insurance and Credit Enhancement Solutions, 220 MW Sirajganj 2 power plant in Bangladesh
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List of Guarantee 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.