Announcement of Six Million Dollar Power Loan in Thailand on March 10, 1965

: INTERNATIONAL BANK FOR ~'RECONSTRUCTION AND DEVELOPMENT 1818 H STREET, N.W., WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 B.lnk Press Release No. 65/12 Subject: $6 million power loan March 10, 1965 in Thailand The World Bank has approved a loan equivalent to $6 million to the Yanhee Electricity Authority of Thailand. The loan will help to finance the installa- tion of 140,000 kilowatts of generating ~apacity at the Bhumibol Dam in north- west Thailand, which will double the present capacity of the power station, and an extension of transmission facilities. This will greatly increase the supply of power in central Thailand, particularly Bangkok, where demand has risen by 66% in the past three years • • Seven commercial banks have agreed to participate in the loan, without the World Bank's guarantee, for a total amount of $600,000 representing the first five maturities which fall due between February 15, 1969 and February 15, 1971. The participants are ~he Chase Manhattan Bank, New York; Irving Trust Company, New York; Bank of America National Trust and Savings Association, San Francisco; First National City Bank, New York; Manufacturers Hanover Trust Company, New York; Crocker-Citizens National Bank, San Francisco; and Grace National Bank of New York. The Yanhee Electricity Authority (YEA) was established by the Government in 1957 with responsibility for the generation and transmission of electric energy in the most developed and populated part of Thailand -- a service area covering 35 of Thailand's 71 provinces. This is the third Bank loan to YEA: one of $66 million was made in 1957 for the construction of the Bhumibol multipurpose dam • for the production of electric power and water control, and a loan of $6.6 mil- lion was made in 1963 for the expansion of the Authority's transmission network. ',.,  - 2 - The dam is designed for the installation of eight 70,000-kilowatt un.its, of which two were installed initially and went into operation in 1964. Double circuit \. . transmission lines have been built between the power plant and Bangkok, and work is well under way on transmission lines to 24 other communities. The loan announced today will help to pay for the installation of two more '70,000-kilowatt units at the Bhumibol Dam; penstocks and related works required for the future installation of the next two u..~its; an increase in sub-station capacity in Bangkok; and an extension of transmission lines to three more communi- ties, Nakorn Nayok, Prachinburi and Samut Sakorn. When these works have been com- pleted the Authority will have 430,000 kilowatts of generating capacity made up of 280,000 kilowatts from Bhumibol and 150,000 kilowatts from a modern thermal plant in Bangkok. The Yanhee Electricity Authority supplies power in bulk to two utilities: Metropolitan Electricity Authority which distributes power in Bangkok and the Pro- vincial Electricity Authority which distributes power to rural communities within the • YEA's service area. This area now extends from Chiengmai in the north down both sides of the Gulf of Thailand below Bangkok in the south. By far the largest power market is Bangkok where power demand has increased substantially in recent years. This increase in demand has been due principally to the rehabilitation of distri- bution facilities in Bangkok by the Metropolitan Electricity Authority, the pro- vision of an adequate and reliable supply of power by YEA, the introduction of a modern rate structure, and a significant increase in light and medium industry in the areas south and east of Bangkok. It is estimated that during the r.est of the 1960 1 s the Bangkok area will ab- sorb more than 80% of the output of YEA's plants, with power demand increasing at an average annual rate of 14% between now and 1970. This estimate is based mainly • • . - 3 - on the expectation that industrial growth in the Bangkok area will continue and that credit facilities will be available for the purchase of consumer appliances, such as refrigerators, stovE:s and air-conditioning units. By 1970 the demand for power in rural connnunities is expected to increase to about 67,000 kilowatts of generating capacity. The project will be carried out by the Yanhee Electricity Authority at a total estimated cost equivalent to $9.8 million. The Bank loan of $6 million will cover most of the foreign exchange requirements and the remaining costs will be met by the Authority from its own resources. Procurement of equipment will be on the basis of international competitive bidding; existing specifica- tions, where applicable, will be used for all major items of equipment. The project is scheduled for completion by December 1968 • • The Bank loan will be for a term of 20 years and will bear interest at the rate of 5\% per annwn. Amortization will begin in February 1969. guaranteed by the Kingdom of Thailand. The loan is Including the loan announced today, the Bank has made 14 loans totaling $192 million in Thailand. In addition to the Yanhee project, earlier loans were for the rehabilitation of the railways, port improvements, irrigation, highway development and for a development finance company • • ._,, .. ',;: