Azerbaijan, Baku, feb.11 / Trend , I.Khalilova /
Talks with foreign banks, involved in financing the building of a 800-megawatt thermal power plant (TPP) Cenub under the Asian Development Bank's (ADB) guarantee support, will be held in the next two months, the bank's Baku office officials said.
Three banks - Societe General, BNP Paribas and City Bank - were chosen, the government said earlier.
"The talks determined final amount of funding from commercial banks, as well as credit terms," the office said.
The ADB is ready to provide guarantee assistance of up to 220 million euros.
Preliminary discussions over financial terms of commercial banks were held in January during ADB financial specialists Martin Endelmann and Roland Pladet's visit to Baku. They held consultations in the Finance Ministry and Azerenerji OJSC.
The government said that, the loan will be issued for 13 years with privileged period for three year and the Libor rate +1, 55 in accordance with the banks' proposals.
ADB Energy Department Head Specialist Cleo Kawasaki is expected to visit Baku Feb.15-20 in order to discuss conditions of project preparation.
"She will hold common consultations, as well as will be familiarized with ecological condition of the project," the Baku office said.
Azerenerji's guarantee assistance will be ADB's first experience in the South Caucasus region.
The project cost is 664, 1 million euros. In 2010, relevant agencies will allocate 117 million euros for construction work. At the moment, 434 million euros is approved for the project.
Bayerische Landesbank, Societe Generale and Credit Suisse banks allocated 300 million euros for the project. The banks issued a loan under a state guarantee for 10 years. These resources will cover half of the construction cost.
The Islamic Development Bank approved financing of 134 million euros Oct.20, 2009.
ADB has been cooperating with the Azerbaijani government since 1999.