Long Phu 1 (1200 MW)
Long Phu 1 is located in Long Đức commune, Long Phú district, Sóc Trăng province.
This plant has been embroiled in corruption scandals, with a Petrovietnam ‘s former chairman charged for economic mismanagement. According to the New York Times, Petrovietnam withdrew its application for funding from the US Export Import Bank, after the US extended its sanctions relating Russia to OJSC Power Machines, one of the engineering, procurement and construction companies (EPC) for the project. The same article indicates that UK Export Finance also withdrew support for the project.
Market Forces has also lodged a complaint with the EU and the United Kingdom Treasury Office regarding possible violation of UK sanctions against Russia because of the involvement of a Russian bank, Vnesheconombank.
According to a June 2017 report authored by Bruce C. Buckheit and comissioned by Friends of the Earth US, “Based on the design information available at this time, the Long Phu 1 units are supercritical units greater than 500MW and, therefore, are ineligible for ECA funding under the OECD Sector Understanding.”
Estimated cost: USD $1.9 billion
The sponsors will finance the project on a 70:30 debt to equity ratio – seeking US$1.4 billion in debt.
Expected financial close: 2017
Status: Construction commenced
Completion expected: 2018
Another 1320MW power plant (Long Phu 2) has been announced for the same site.
- OJSC Power Machines (Russia)
- BTG Energy (Slovakia)
- PetroVietnam Technical Services Joint Stock Corporation (PTSC)
Lead Arrangers (US$650M)
- HSBC (global coordinator)
- Cathay United Bank
- Mitsubishi UFJ Financial Group
- JP Morgan
Export Credit Agencies (ECAs)
- SACE (Italy)
- Hermes (Germany)
- Egap (Czech Republic)
- Exiar (Russia)
- International Investment Bank
- Vnesheconombank (Russia)
- GE (2 September 2015), ‘GE High-Efficiency Steam Turbines Selected for Petrovietnam’s New Coal-Fired Power Plant’
- Vietnam Energy Online, (9 August 2015), ‘Long Phu 1 Thermal Power Project is beeing (sic) developed as planned’
- Vietnam Today (9 August 2015), ‘Long Phu 1 Thermal Power Plant breaks ground’
- Project Finance International (7 September 2016) ‘Funders Appointed on Long Phu 1’
- PetroVietnam (2017), ‘Long Phu Thermal Power Plant’
- IFR News, (15 Apr 2017), PetroVietnam seeks US$650m PF’
- Vnesheconombank (8 Sep 2017), ‘VEB and IIB to Finance Power Plant Construction in Vietnam‘
Information updated: 12 September 2017
In addition to the references noted above, Market Forces also considers information from financial journals, companies’ public disclosures, and news reports.