Deqing Wuxin Line Water Canal Operation Co. Ltd.

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Deqing Wuxin Line Water Canal Operation Co. Ltd., was awarded a 30-year contract for upgrading and operating a waterway project in Zhejiang Province in August 2005. The consortium was allowed to collect tolls for a 30-year period. The project included deepening, widening and straightening the existing 40 km canal to only 24.9 km and rebuilding 12 overhead bridges.As a result, the total volume of cargo to be transported via the canal was expected to increase from the 28 million tons per year up to 34 million tons per year by 2020 The partners under the joint venture company, Deqing Wuxin Line Water Canal Operation Co. Ltd., included Malaysia-based Isyoda Corp. Bhd (70%) in conjunction with the state-owned Deqing County Transportation Bureau (20%) and Zhejiang Provincial Port & Navigation Administration Bureau (10%). The construction phase was expected to take 20 months with the total project cost was estimated at US $47 million (RM178.12 million). Under the project, 65% of the investment, estimated US$ 30.55 million (RM 115.78 million), was to be funded by loans and the rest 35% (RM 62.34 million) by equity. The term loan was expected to be fully repaid in about nine years, after which the Deqing Wuxin Line Water canal was expected to yield cash flow of about US$ 3.01 (RMB 25 million) per annum. The toll was to be US$ 0.18 (RMB1.5) per tonne compared with US$ 0.06 (RMB 0.5) per tonne in 2005.