AES Corporation has closed $1.5bn long-term construction financing for the 1.2 GW Mong Duong II coal fired plant in Quang Ninh Province, Vietnam, in which the company holds 51 per cent of equity.
Twelve commercial banks and two Korean government export credit agencies participated in the transaction to facilitate the $1.95bn project.
Doosan Heavy Industries and its affiliates will be the engineering, procurement and construction (EPC) contractor for the plant, which will sell electricity to Vietnam Electricity (EVN) under a 25-year power purchase agreement. Under a parallel deal Vietnam National Coal-Mineral Industries Group (Vinacomin) will supply fuel over 25 years.
“This is a notable achievement that demonstrates the strength of our project finance model and is a testament to our ability to raise capital in the face of challenging global economic conditions,” said Victoria D. Harker, AES’s executive vice-president and chief financial officer.
The project is being implemented under Vietnam’s build-operate-transfer (BOT) regulatory regime. It is the country’s largest private sector power project and AES is the first independent power producer to reach financial close in Vietnam since 2003, according to AES.
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