The Japan Bank for International Cooperation (JBIC) has signed a loan agreement totalling up to approximately US$ 763 million with PT Donggi-Senoro LNG in Indonesia.
The loan, provided in project financing, is co-financed with private financial institutions, including The Bank of Tokyo-Mitsubishi UFJ, Ltd., Mizuho Bank, Ltd., Sumitomo Mitsui Banking Corporation, and Korea Exim Bank (KEXIM). Nippon Export and Investment Insurance (NEXI) will provide insurance and KEXIM will provide guarantee for part of the portion co-financed by private financial institutions.
Donggi-Senoro will construct and operate an LNG plant to produce 2 million tpa of LNG in the centre of the eastern coast of Sulawesi Island and sell LNG produced there to Japanese electric power companies and others for a duration of approximately 13 years. This loan will provide funds required to construct the LNG plant.
Indonesia’s ‘New Strategic Energy Plan’, decided by the cabinet in April 2014, advocates the diversification of LNG supply sources. Although Indonesia used to be the largest LNG exporter to Japan until the first half of the 2000s, import volume from the country has been decreasing in recent years and is expected to continue to decrease in the future. Given this prospect, this project plans to enable Japanese electric power companies to take delivery of more than 60% (1.3 million tpa) of LNG produced.
JBIC's support of this project will contribute to diversifying the supply sources of LNG and securing its stable supply for Japan.
Adapted from press release by Katie Woodward
Read the article online at: https://www.lngindustry.com/liquid-natural-gas/14112014/jbic-funds-indonesian-lng-project-1793/