Active Development AidData Chinese Aid

China Eximbank provides $223 million loan for Ramu System Extension Yonki-Mt. Hagen Phase 2 Project (Linked to Record ID#61203)

$223M USD

Funder	Export-Import Bank of China (China Eximbank)
Recipient Organization	Government of Papua New Guinea
Country	Papua New Guinea
Start Date	Feb 05, 2022
End Date	Apr 28, 2029
Duration	2,639 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`95852`

Grant Description

China Eximbank provides $223 million loan for Ramu System Extension Yonki-Mt.

Hagen Phase 2 Project On February 5, 2022, China Eximbank and the Government of Papua New Guinea signed a $223 million government concessional loan agreement for the Ramu System Extension Yonki-Mt. Hagen Phase 2 Project.

📋 Loan / Grant Terms

📅 Maturity19.6666 years

💹 Interest Rate2%

The borrower is expected to use the proceeds of the GCL to finance 100% of the cost of a $223 million (K800 million) commercial contract between PNG Power Ltd and Tebian Electric Apparatus (TBEA) Ltd, which was signed in July 2021.

The purpose of the project is to extend the National Electricity Transmission Grid (Network) from Ramu Grid in Yonki to Mt.Hagen in order to enable electricity access to Yonki in Eastern Highlands Province, Mt. Hagen in Western Highlands Province, and Simbu in Chimbu Province and Jiwaka Province.

The project involves the erection of the transmission towers, the stringing of 132kV transmission lines, and construction of 132kV substations in Kainantu, Goroka, Kundiawa, Yonki, Minj, and Mt. Hagen. TBEA is the contractor responsible for project implementation, which is expected to take place between 2022 and 2025.

📋 Staff Comments

This project is also known as the Papua New Guinea Power Grid Second Phase Project, Phase 2 of the National Power Grid Development Project, the Ramu System Extension Yonki-Mt. Hagen Phase II Project, the Mt Hagen to Ramu Transmission Line-Phase 2 Project, Phase 2 of the Transmission System Upgrade for Yonki (Eastern Highlands) to Mt Hagen (Western Highlands) Project, and the Port Moresby to Ramu 132kv Power Transmission and Transformation Project. The Chinese project title is 巴布亚新几内亚国家电网二期项目 or 巴布亚新几内亚(Mt.Hagen-Yonki)132kV变电.
This project corresponds to the Government of Papua New Guinea PIP Number 05660.
This project should not be confused with the ADB-financed and TBEA-implemented Tari-Hides Power Project, which involves the construction of transmission lines for electricity transmission between Hides and Tari in Hela. PNG Power Ltd and Tebian Electric Apparatus (PNG) Ltd (TBEA) signed a commercial contract for the Tari-Hides Power Project July 15, 2021.
The China Eximbank loan that supported Phase 1 of the National Power Grid Development Project (or Papua New Guinea Power Grid First Phase Project) — also known as the Tari-Mt. Hagen 132 kv Transmission Line Project — is captured via Record ID#61203.
According to the World Bank's Debtor Reporting System (DRS), the weighted average grace period of all official sector lending from Chinese creditors to government and government-guaranteed borrowing institutions in Papua New Guinea was 5.1666-years in 2022. AidData estimates the grace period of the China Eximbank loan that supported the Ramu System Extension Yonki-Mt. Hagen Phase 2 Project by using this figure. See https://www.dropbox.com/scl/fi/drf58ay3c2fr6hlv24vq8/December-2023-DRS-Data-Extraction-for-Papua-New-Guinea.xlsx?rlkey=9gqc03oudt91eas7nf53zec38&dl=0 6. According to the World Bank's Debtor Reporting System (DRS), the weighted average maturity of all official sector lending from Chinese creditors to government and government-guaranteed borrowing institutions in Papua New Guinea was 19.6666-years in 2022. AidData estimates the maturity of the China Eximbank loan that supported the Ramu System Extension Yonki-Mt. Hagen Phase 2 Project by using this figure. See https://www.dropbox.com/scl/fi/drf58ay3c2fr6hlv24vq8/December-2023-DRS-Data-Extraction-for-Papua-New-Guinea.xlsx?rlkey=9gqc03oudt91eas7nf53zec38&dl=0 7. According to the World Bank's Debtor Reporting System (DRS), the weighted average interest rate of all official sector lending from Chinese creditors to government and government-guaranteed borrowing institutions in Papua New Guinea was 2% in 2022. AidData estimates the interest rate of the China Eximbank loan that supported the Ramu System Extension Yonki-Mt. Hagen Phase 2 Project by using this figure. See https://www.dropbox.com/scl/fi/drf58ay3c2fr6hlv24vq8/December-2023-DRS-Data-Extraction-for-Papua-New-Guinea.xlsx?rlkey=9gqc03oudt91eas7nf53zec38&dl=0 8. As of 2024, the China Eximbank loan that supported this project was not included in the China's Overseas Development Finance (CODF) Database published by Boston University’s Global Development Policy Center.

📚 Sources & References

Joint Statement Between the People's Republic of China and the Independent State of Papua New Guinea
Joint Statement Between the People's Republic of China and the Independent State of Papua New Guinea.
China's grip on PNG tightens
中华人民共和国和巴布亚新几内亚独立国联合声明
中华人民共和国和巴布亚新几内亚独立国联合声明（全文）, 2021年海外大型输电项目回顾
中国能源建设(03996)附属签订巴布亚新几内亚莫港至瑞木132千伏输变电项目合同涉资2.68亿美元
US$2.028 billion!Gezhouba signs new EPC contracts with four countries
Gezhouba has 4 draws a day! The summit forum ended perfectly!
China Energy Engineering Corp Says Unit Entered Contract Project In Papua New Guinea
Transmission upgrade will cost K500mil, says Batia
K1b plus for transmission project
KCH-2020-Annual-Review
Govt signs K71mil deal
Tari to Hides power project to reduce cost
Tari to Hides Project: A Vital Piece of A Project of National Importance
PNG Signs K71 Million Power Project agreement With Chinese Company
FINAL BUDGET OUTCOME 2021
Exits From Png Power
PNG Secures Loan From China
Is the vaunted national electrification project in jeopardy?
Marape Greed Compromises National Security Chinese control Ramu Grid
PNG PM Marape has hailed his recent Chinese Visit a successful one
China visit a success, 【巴布亚新几内亚(Mt.Hagen-Yonki)132kV变电站保护及监控系统设备】TBEA-SB-BBYXJNY-SB-2022-002-招标公告
VOLUME 2D 2022 BUDGET ESTIMATES FOR STATUTORY AUTHORITIES PROVINCIAL GOVERNMENTS DEBT SERVICES AND TRUST ACCOUNTS
December 2023 DRS Data Extraction for Papua New Guinea 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.