JBIC EXTENDS BUYER'S CREDIT FOR GEOTHERMAL POWER PLANT IN MEXICO
1.Japan Bank for International Cooperation (JBIC; Governor: Hiroshi Yasuda) signed today a loan agreement totaling US$180 million with Norelec del Norte, S.A. de C.V.(NORELEC) to construct a private power plant in Mexico. NORELEC is a wholly owned subsidiary of Mitsubishi Corporation established in Mexico solely to implement this project. The loan is co-financed with Tokyo Mitsubishi Bank, BNP Paribas, Tokyo Branch, Société GénéraléTokyo Branch, and Standard Chartered Bank, Tokyo Branch, with JBIC assuming US$108 million, or 60% of the total loan amount. The proceeds of the loan will be used to procure equipment and services from Japan for the Combined Cycle Power Generation Plant Project in Chihuahua State. Suppliers will be Mitsubishi Corp. and Mitsubishi Heavy Industries, Ltd.
2. This Project will be carried out under the Build, Lease and Transfer scheme (BLT) under which a Combined Cycle Power Generation Plant with a capacity of 450MW will be built and leased to Comición Federal de Electricidad,(CFE)for 15 years. The plant will be located approximately 30 kilometers southeast of Chihuahua city, Chihuahua State, United Mexican States.
3.Electricity demand in Mexico is expected to increase at an annual growth rate of 6.1 per cent until 2008, and peak electricity demand in 2008 is expected to expand by 1.6 fold from the demand in 1999, or an increase of 22,000 MW. Therefore, new power generation plants to meet the rapid growth in demand are required before 2008. The Mexican government amended the Electricity Public Service Law in 1992, and the country has been promoting private participation in electric power projects through arrangements such as IPP (Independent Power Plant) and BLT.
4. This loan is expected to encourage private sector participation, assuring a stable power supply, and thereby contributing to the economic development of Mexico where many Japanese firms are doing business.