ADB, Azerbaijan select commercial banks for energy project
Azerbaijan, Baku, Jan.21 / Trend , I.Khalilova /
The Asian Development Bank (ADB) and Azerbaijani government have started to select commercial banks to finance the construction of the Cenub thermal power plant with a capacity of 800 megawatts under a guarantee from ADB.
"ADB financial specialists Martin Endelmann and Roland Pladet are on visit in Baku in order to get acquainted with financial terms of foreign banks," the bank said.
The major commercial banks are showing great interest in project, although it is expected to complete the selection process in February. Financial Mission of ADB will visit Baku in order to hold consultations in the Finance Ministry and Azerenerji by the end of next week.
ADB is ready to provide guarantee support worth up to 220 million euro. Providing such a guarantee would extend term of attracted loans, and they can be at least 13 years, as well as lead to lower interest rates on loans," the bank said.
The guarantee support for Azerenerji will be the first experience of this kind for the ADB in the South Caucasus region.
The total cost of the project is estimated at 664.1 million euro. It is planned to spend 117 million euro from the already approved foreign loans under the project for construction works in 2010. Receipt of financing worth 434 million euro has been already approved.
Roughly 300 million euro from a consortium of three banks - Bayerische landesbank, Societe Generale and Credit Suisse have been already attracted to finance this project. The loan has been granted under a state guarantee for 10 years. The loan resources of the banks consortium will cover half the cost of works associated with the construction of the station.
Islamic Development Bank has approved financing worth 134 million euro Oct. 20. The Cenub station will operate with gas and fuel oil.
The Azerbaijani government and ADB cooperate since 1999.
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