Announcement of Twenty-Four Million US Dollars in Loans for Power and Telecommunications in Costa Rica on February 17, 1972

FOR IMMEDIATE RELEASE • • INTERN F~ECONST 1618 H STREET, N.W., WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 Bank Press Release No. 72/8 Subject: $24.0 million in loans for February 17, 19 72 power and telecommunications in Costa Rica The World Bank will further assist electric power and telecommunication develop~nt in Costa Rica with two loans totaling $24.0 udll~cu. total, $6.5 million will be for additional generating capacity and trans- mission facilities in a power project costing $8.3 million and $17.5 million will assist new expansion of urban and long-distance telephone facilities to be carried out at an estimated cost of $32.2 mil}ion. • The execution of the projects will be carried out by the Instituto Costarricense de Electricidad (ICE), an autonomous agency in charge of Costa Rica's power and teleconnm.mication services. The Bank has been associated with ICE's development programs for the last 10 years. It has previously assisted ICE with three loans for power and two for telecommunications. The power project consists of the installation of two gas turbine units of about 15 megawatts each at the existing San Antonio plant near San Jose, to help meet peak demand in 1973 and serve as stand-by units for the hydro- power capacity; the installation of two diesel units of about 3 megawatts at the port of Limon to supplement existing capacity; and the construction and reinforc~m~nt of various transmission lines and substations in the inter- connected system. In.eluded in the financing of the power project are engineering studies • for the pr~paration of ICE's long-range expansion program, the design of a future thermal plant and the San Jose distribution system and other studies related to future sectoral development as well as organization studies. /more • Bank P.R. No. 72/8 -- Costa Rica -- power and telecom. - 2 - The telecommunications project is aimed at meeting growing demand at adequate levels of service. The Bank loan will assist the 1972-?5 phase of ICE's general development program for the sector, including: expansion of the telephone network capacity by 25,000 exchange lines; long-distance service; expansion of the new national/international telex exchange in San Jose and sma'ller installations in the country's ma.in ports -- Puntarenas and Limon; end est .:Jilishment of 600 rural public call of fices. The project a1Ao includes employment of instructors for ICE's technical training p~ogram, and of consultants to help plan future expansion. • Both loans will finance the estimated foreign costs of the projects • Equipment will be procured through international competitive bidding. The loans to ICE will have the guarantee of the Government of Costa Rica. Each will be for a term of 20 years, including a 4~-year grace period for the power loan and a ~-year grace period for the te:ecommunications loan. The interest rate for both loans will be 7~% per annum. Security Pacific National Bank, Los Angeles, is participating in the Bank loan for the telecommunications project for a total amount of $250,000. Two financial institutions -- Bank of America, New York, and Marine Midland Bank - New York -- are pa~ticipating in the Bank loan for the power project for a. total amount of $215,000. - 0 - • • 1818 H STREET, N.W., WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 February 17, 19 72 TECHNICAL DATA PROJECT: Power COUNTRY: Costa Rica TOTAL COST: $8. 3 million BANK FINANCING: $6.5 million, 20 years including 4!2 years of grace, 7\% interest. OTHER FINANCING: Internal cash generation. • IMPLEMENTING ORGANIZATION: Institute Costerricense de Electricidad (ICE), San Jose, Costa Rica; Cable address: ICE, San Jose, Costa Rica; Telephone: 22-4422. PROJECT DESCRIPTION: Installation of two gas turbines of about 15 megawatts each; installation of a diesel power station of about 3 megawatts; c.onstruction of power transmission facilities; and retention of consultants for engineering studies a.~d for studies of the power sector and ICE's organization. PROCUREMENT: (Bank financed) • Two gas turbines of about 15 megawatts each (bids are being evaluated); one diesel plant of about 3 megawatts; transmission lines and substations; consultant services. Procurement through international competitive bidding. Manufacturers in the Central American Connnon Market will be allowed a 15% preference. CONSULT.ANTS: Sofrelec, France: preparation, design and construction of power projects. Geoconseil, France: to provide geological advice. Electroconsult, Italy: to study distribution system in San Jose. Consultants for organization study of ICE and for power sector study to be selected. ESTIMATED COMPLETION DATE: 1975. • - o-