JBIC, Mizuho sign $110m loan for Rajamandala power project
Thursday, June 26 2014 - 04:20 AM WIB
By Romel S. Gurky
Japan Bank for International Cooperation (JBIC) and Mizuho Bank Ltd have agreed to provide US$110 million worth of project financing facility for the Rajamandala hydro power plant project being developed by PT Rajamandala Electric Power (REP).
JBIC said in a statement that the loan agreement was signed on Tuesday. The bank's portion in the loan facility was $66 million, it added.
"The loan is intended to finance the construction and operation of the run-of-the river hydro power plant with the capacity of 47 MW located in the Rajamandala on Citarum basin, Cianjur Regency, West Java Province, Indonesia. The electricity produced is going to be sold to PT PLN (Persero) for 30 years," the statement said, referring to the state-owned electricity firm.
In Indonesia, the demand for electric power is expected to grow at 8.5 percent annually for the next ten years. The hydro power plant project, in which Japan's Kansai Electric Power Co (KEPCO) has been involved independently from its feasibility study stage and is also participating in as an investor, will be operated and managed for the long term with Japanese technology. The loan supports (financially) the participation of Japanese companies in overseas infrastructure projects and thereby will contribute to maintaining and strengthening the international competitiveness of Japanese industries, JBIC explained in the statement.
Editing by Reiner Simanjuntak