VietNamNet Bridge - Four local banks signed on August 3 an agreement pledging a loan of over VND4 trillion ($255 million) for two Electricity of Vietnam (EVN) hydro power plants.

Signatories to the agreement on the loan, which will be due in 12 years and include a three-year grace period, were representatives from the Bank for Foreign Trade of Vietnam (Vietcombank), the Bank for Investment and Development of Vietnam (BIDV), the Technical and Commercial Bank of Vietnam (Techcombank) and the Bank for Agriculture and Rural Development.

Nearly VND1.83 trillion ($114 million) of the loan will be spent on Dong Nai 3 electricity plant with a designed capacity of 180 MW in Dak Nong province. The remaining finance will be used for Dong Nai 4 plant capable of producing 340 MW electricity a day in Lam Dong Province.

Upon full completion, slated for late 2009, the two power plants, with an estimated cost of VND9 trillion ($556 million), are expected to churn out a combined 1.7 billion kW electricity per year. It is expected that the new plants will partly shoulder the burden of the overloaded national electricity supply system and better ensure sufficient energy supply.

On behalf of the investors, Director General Vu Viet Ngoan of Vietcombank committed to the timely disbursement for the two projects and asserted that from now till 2015, the four banks will continue financing EVN's projects and Vietcombank alone will provide VND15 trillion ($937 million).

EVN's Board of Management Chairman Dao Van Hung said that a pledge by the four investors to provide his corporation with a combined VND42 trillion ($2.6 billion) loan from 2006 to 2010 is a critical factor for the EVN's future expansion.

(Source: VNA)