China funds Puttalam coal power project

COLOMBO: The Government of China through the Export Import Bank of China has agreed to provide a credit package in US$ 455 million for the implementation of the proposed Puttalam Coal Power project.

Of this, US$ 300 million is provided as a concessional loan under a Preferential Buyer's Credit Agreement while the balance US$ 155 million is provided under a Buyer's Credit Agreement, the Finance and Planning Ministry said.

The power plant will be built in three phases of 300 MW capacities each up to the final plant capacity of 900 MW. The proceeds of the credit will be used to implement Phase I of the power plant which includes the installation of a 300 MW Coal Power Plant in Norochcholai, Puttalam, all the auxiliary equipment/ systems, including a coal unloading jetty, a 115km power generation line and other infrastructure facilities.

The proposed project will be operated as one of the base load plants with the capacity of operating at partial loads when required, utilising coal as the source of fuel for power generation.

The total cost of the project including the infrastructure such as transmission lines and jetty facilities, is estimated at US$ 455 million.

The weighted average interest rate of the total loan amount of US$ 455 million is approximately 3.5 per cent per annum with a 15 to 20 year repayment period including a grace period of five years.

The loan agreement was signed by Dr. P.B. Jayasundera, Secretary, Ministry of Finance and Planning on behalf of the Government of Sri Lanka and Li Yong, Assistant General Manager, Export Import Bank of China on behalf of the Government of China at the Ministry of Finance and Planning.