ASIA POWER (PRIVATE) LIMITED (APPL)

completed

Summary Of Project Information (SPI)Project NameSri Lanka-Asia Power (Private) LimitedRegionAsiaSectorProject No104331Projected Board DateJune 26, 1996Company NameAsia Power (Private) Limited (APPL)Technical Partner and/or Major Shareholders Klockner Humboldt Deutz, Great Britain Ltd. (31.8%), Nissho Iwai, Japan (18.27%) and Burmeister & Wain Scandinavian Contractor, Denmark (6.8%).Project Cost Including proposed IFC investment US$62 milion of which IFC will provide an equity investment of up to US$2.5 million for 11.4% of the common stock of APPL, an A Loan of US$10 million, a subordinated loan of up to US$2.5 million, and a B Loan of up to US$20 million.Location of project and Description of site The plant is located about 20 km from the capital city of Colombo in South Western Sri Lanka.Description of Company and Purpose of Project A company formed in Sri Lanka to build, own and operate a 51 MW diesel power station to sell electrical energy to the Ceylon Electricity Board (CEB) on the basis of a 20 year Power Purchase Agreement.The growth in the Sri Lankan Power Sector has not kept pace with the rest of the economy. The World Bank estimates an immediate need for 200 MW of additional generation capacity by 1997-98. This represents over 15% of the current installed capacity. The World Bank estimates that by the year 2000 Sri Lanka needs to add at least 500 MW of additional power generation capacity. Hence, addressing the power shortage problem of Sri Lanka has become one of the country’s high priorities. To this end, the Government of Sri Lanka has introduced several policy changes aimed at increasing the participation of the Private Sector in power generation. The proposed project will be Sri Lanka’s first independent power producer. The Sri Lankan system is predominantly hydro and thus dependent upon the monsoon. Brown-outs and load shedding are common during the summer and/or dry seasonal spells. There is a need to increase thermal generation capacity. The project is to build own and operate a 51MW diesel plant fueled by the locally-available heavy residual fuel oil -- a by-product generated by the Ceylon Petroleum Corporation. The World Bank maintains that the best economic use of this heavy residual fuel oil is power generation. The plant is to consist of eight generating units, each site rated at 6.35 MW with a power factor of 0.8 logging at 11kV/50Hz. The prime movers are 16 cylinder, 600 rpm, compression ignition engines manufactured by Deutz/MWM of GermanyEnvironmental Category and Issues This is a Category B project according to IFC’s environmental review procedure. Environmental issues associated with this project include air emissions and dust, traffic during construction, noise levels, effects on biota, and visual impacts. Occupational health and safety issues include noise and general worker safety. The sponsors have submitted an independent environmental impact assessment (EA) report. A review of the EA and the proposed mitigation measures confirms that the proposed power plant is designed to meet World Bank environmental, health and safety policies and guidelines and host country requirementsThe as well as the Environmental Review Summary are from the Public Information Center.Date SPI sent to PIC May 22, 1996For Additional Information contact: Corporate Relations Unit -telephone: (202) 473-7711facsimile: (202) 676-0365Environmental documents for this project are available at http://www.ifc.org and from the World Bank InfoShop (http://www.worldbank.org/html/pic/aboutinfo.html).