HEXIM and EDC partner to finance $435 million in GE mobile power plants for Indonesia

Written By: Stratton Report
December 13, 2016

On December 13, the Hungarian Export Import Bank Plc. and Export Development Canada announced that they have partnered to co-finance eight GE 500-MW mobile power plants being developed by Indonesia state utility, Perusahaan Listrik Negara. The twelve-year loan agreement was for approximately $435 million.

Per the export credit agencies, they equal participation in the total commitment. HEXIM’s financed portion is covered by Hungarian Export Credit Insurance Company while EDC provided direct financing. Standard Chartered Bank acts as agent coordinating the administration duties of the Facility.

This mobile power plants project is part of PLN’s project to install 35,000-MWs of new power capacity by 2019.
GE Energy Financial Services’ Global Capital Markets division served as financial advisor to PLN.

Sarwono, Finance Director of PLN, commented:

“PLN is committed to expand access to electricity in Indonesia and support the government’s program to develop additional electricity capacity by 35,000 MW by 2019, which will help drive economic growth across Indonesia. As such, we have been utilizing ECA financing without sovereign guarantee in our financing portfolio in addition to financing from other bilateral and multilateral institutions.”

Per the banks, the 500-MW Mobile Power Plants are located in eight locations in Indonesia, including: Lampung (100 MW), Pontianak (100 MW), Bangka (50 MW), Riau (75 MW), Belitung (25 MW), Ampenan (50 MW), Paya Pasir (75 MW) and Nias (25 MW), all areas that have been determined to need additional electricity infrastructure.

Zoltán Urbán, CEO of HEXIM observed: “General Electric in Hungary cooperating with more than 600 Hungarian suppliers is a strategic partner of the Hungarian Government. 15 of the 20 delivered turbines were manufactured in Hungary (Veresegyház), which increased significantly the volume of the Hungarian export to Indonesia. This deal proves that Hungary takes an important role in the global value chain of the energy sector. The Hungarian additional benefit has significant effect on the Hungarian GDP. HEXIM with its biggest ever participation as co-lender with EDC strengthens its presence in the international export financing markets.”

Carl Burlock, EDC Senior Vice-President, Financing and Investments remarked: “EDC is very pleased to have participated in arranging financing for this important power project in Indonesia while providing support to our global strategic client, GE,” added Brian Ward, Managing Director of GE Energy Financial Services’ Global Markets said, “We are pleased to play a role in developing Indonesia’s power sector and economy as a whole by providing our technology and financing capabilities to PLN and its subsidiaries who will bring much-needed power to the Indonesian people.”