Projects
Project Brief
Summaries of proposed guarantees are provided prior to Board consideration and before final contract signing, and they are therefore subject to change. Project briefs are disclosed after Board consideration and contract signing and reflect the terms of the project at the time of contract signature. Environmental and Social Review Summaries are provided for projects assigned an Environmental Assessment Category of A or B.
- Project name
- Ashuganj Power Station Company Ltd. (APSCL)
- Project ID
- 10517
- Fiscal year
- 2013
- Status
- Active
- Guarantee holder
-
HSBC
- Investor country
-
United Kingdom
- Host country
-
Bangladesh
- Environmental category
- A
- Sector
-
Power
- Date SPG disclosed
- September 06, 2012
- Project Board date
- November 20, 2012
- Gross exposure
- $221.4 million
- Project type
- Non-SIP
- Strategic priority area
-
Complex Project
South-South
IDA
- ESRS
- Environmental and Social Review Summary for Ashuganj Power Station Company Ltd. in Bangladesh
View Summary of Proposed Guarantee
On December 28, 2012, MIGA issued a guarantee of $221.4 million to Hong Kong Shanghai Banking Corporation (HSBC) of the United Kingdom to cover its non-shareholder loan to Ashuganj Power Station Company Ltd. (APSCL) in Bangladesh. HSBC coordinated and arranged a $406 million financing package to APSCL for the project. MIGA's guarantees are for a period of up to 13.5 years against the risk of non-honoring of sovereign financial obligations. The Ministry of Finance of Bangladesh has provided an unconditional sovereign guarantee covering debt obligations of APSCL under its loan agreement with HSBC.
The project consists of the construction of a 450-megawatt combined cycle gas-fired plant on the basis of a contract awarded by APSCL to a consortium of TSK Electronica y Electricidad S.A. (Spain) and Inelectra International AB (Sweden). This project will replace certain existing units in the Ashuganj facility that will be decommissioned once the new plant is completed.
Bangladesh currently faces an acute shortage of power generation capacity. This impairs the country's economic and social development and constrains growth. The government of Bangladesh has made energy a high priority and recently adopted an updated Power Sector Master Plan, which includes this project. This project will help meet the country‘s growing demand for power, using a domestic gas resource and efficient technology.
MIGA's participation in this transaction is critical to mobilizing the debt financing for this project. The project is consistent with MIGA's strategic priorities of supporting investment into IDA countries and complex projects.
