The government has issued a US$ 1.0 billion worth of state guarantee in favour of Chinese loan for implementing a 1320-mw Payra coal-based power plant project, officials have said.
A senior finance ministry official said the fund will be sourced from Exim Bank of China which requires a guarantee from the government. The finance ministry has recently given guarantee to the bank.
Bangladesh-China Power Company Limited (BCPCL) will build the coal-based power plant in Patuakhali. It is 50:50 joint venture between North-West Power Generation Company Ltd (NWPGCL) of Bangladesh and China National Machinery Import and Export Corporation (CMC).
An agreement on land lease was signed in September 2016 between North-West Power Generation Co Ltd and Bangladesh-China Power Company (Pvt.) Ltd (a JVC of NWPGCL, Bangladesh and CMC, China) for the implementation of the 1320mw Payra power plant project at Kalapara in Patuakhali at an estimated cost of over US$ 1.98 billion, according to the NWPGCL data.
The government has allocated 998.77 acres of land to North-West Power Generation Co Ltd for implementing the project on turnkey basis by using eco-friendly ultra super critical technology.
The first and second units of the plant are expected to come into operation in April, 2019 and in October, 2019 respectively. The plant will run on imported coal.
As per the contract, engineering, procurement and construction (EPC) contractor has already injected 15 per cent amount of contract prices while 31 per cent physical progress has been completed. The total injected amount of equity for BCPCL was US$ 129.39 million as of November last year.
The authority concerned will have to inform the ministry within first five days of every month until the loan is paid, according to an office order of the finance ministry.