Energy Bangla

Asian Development Bank, International Finance Corporation, and Islamic Development Bank, will sign loan documents on 2nd June to provide USD 210 million financing to Summit Bibiyana II Power Company Limited (SBIIPCL), a company set up by Summit Industrial and Mercantile Corporation (Pvt.) Limited (Summit), and GE Energy, LLC (GE), for a 341 MW gas based power plant in Sylhet.
The tenor of the loan is approximately 14 years. The direct loan amount is the largest given to a Bangladeshi private sector project by any of the three development agencies. This will be the largest project finance transactions development by a Bangladeshi company.The proposed investment also fits well with the regional development strategy of the three multilateral development banks.
Bangladesh suffers from shortages of power with only about 60% of the total population having access to electricity. This investment will help in achieving the Government of Bangladesh target of 20,000 MW power capacity by 2020, taking electricity to an additional three million consumers.
The operations and maintenance of the plant will be carried out by China Northeast Electric Power Engineering & Service Co., Ltd. an experienced international operation company from China.
‘Apart from meeting the power demands of the country, the project is providing reliable employment opportunity during construction and operational phases,’ said Mr Tariqur Rashid, DMD of Summit Turbine Division
The facility agreements are done as per international project finance practice while in a milestone achievement, the account and security bank is Brac Bank Limited- the first time a Bangladeshi Bank has undertaken specified roles in a major international financing transaction.
‘The project will help Bangladesh alleviate its power shortages, which result in periodic load shedding and adversely impact the country’s economic growth and poverty reduction efforts.’
said Don Purka, Director of Infrastructure Finance Division 1, Private Sector Operations Department of ADB.
‘IFC is proud to be part of this project because our investment will send a positive signal to other private sector players in Bangladesh, who are planning to develop efficient power projects aimed at expanding access to power,’ said HyunChan Cho, IFC Regional Industry Head for Infrastructure and Natural Resources.
‘For IDB, this is part of its commitment for infrastructure development in its member countries and is extremely pleased with this support to the private sector participation in the power generation capacity of Bangladesh,’ stated Dr. Walid Abdelwahab, Director Infrastructure at Islamic Development Bank
‘Bibiyana II is producing the lowest cost electricity and will provide the most important requirement for industrial growth to the country. Summit will keep working to provide electricity to eradicate poverty and bring about inclusive sustainable growth for the people of Bangladesh with its strong financial and management strength. We (Summit) have raised more than USD 500 million from foreign lenders over the last four years’ said Ayesha Aziz Khan, Director of the Group.
In 2014, Summit Industrial and Mercantile Corporation (Pvt.) Limited’s (SIMCL) Meghnaghat Power Company Limited received USD 190 million from a consortium of lenders comprising of DEG, FMO, CDC, OFID (USD 120 million), Standard Chartered Bank (USD 40 million), and IDCOL (USD 30 million). The project is in full operation now and generating 315 MW of electricity.
Summit Group has interests in infrastructure investments such as power generation, port, and telecommunication and is currently producing approximately 1200 MW of electricity.