PAKISTAN: Japan confirms finance for AES power plant

09 February 1996

AES Transpower of Singapore, a subsidiary of the US' AES Corporation, has successfully completed the financing package for its wholly-owned subsidiary, AES Pak Gen. The company is to build a power station, known as Lal Pir-2, near Muzaffargarh in Punjab.

The final piece of the finance package was a buyer's credit facility established by the Export Import Bank of Japan (Jeximbank) worth $40 million plus Y14,203 million ($133 million). The lead arranger of the facility was Bank of Tokyo, which syndicated the loan to 15 private financial institutions. Part of the facility is insured by the Japanese Ministry of International Trade & Industry.

Final details of finance from the International Finance Corporation (IFC) have also been announced. IFC will provide a direct loan of $20 million, and will help arrange a syndicated loan of $50 million, with Dresdner Bank and ING Bank. IFC will also make an equity investment of $9.5 million.

AES are to provide $85.5 million in equity.

The total cost of the project is estimated to be $350 million (MEED 12:1:96).

The 365-MW power station is being built on a build-own-operate (BOO) basis and will be the second to be established by ABS in the Punjab. It will have a steam turbine and will burn residual fuel oil. Nichimen Company of Japan have the turnkey contract for the construction, and major equipment is to be supplied by Mitsubishi Heavy Industries (MHI), also of Japan. Operation is scheduled for December 1997. Power purchase agreements with the Water & Power Development Authority (WAPDA) and fuel supply contracts with Pakistan State Oil have been signed.

Bank of Tokyo, with support from Jeximbank, arranged a Y20,250 million ($192.3 million) loan for an AES 362-MW power station known as Lal Pir-1, in April 1995 (MEED 21:4:95).

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