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Iceland / Loan Insurance for Theistareykir Geothermal Power Project


Dec 14, 2015

Nippon Export and Investment Insurance

Nippon Export and Investment Insurance (NEXI) has decided to provide insurance for loans extended by commercial banks to finance a project of a geothermal power plant constructed by Landsvirkjun (National Power Company of Iceland, or “NPC”) at Theistareykir in the northeast of Iceland. This will be the first time for NEXI to provide a medium- to long-term insurance for loans made to fund a project in Iceland.

To build the Theistareykir geothermal power plant, NPC awarded a contract for a power generating unit including steam turbine and generator to Fuji Electric Co., Ltd., a Japanese manufacturer, and its German consortium partner Balcke-Dürr GmbH. NPC’s purchase of the unit will be funded by loans from Japan Bank for International Cooperation (JBIC) and commercial banks including Citibank Japan Ltd. (lead arranger), The Bank of Yokohama, Ltd., and Commerzbank AG Tokyo Branch. NEXI’s insurance will support these commercial banks.

In Iceland, over 99% of its annual power generation comes from renewable sources. By helping Japanese manufacturers of geothermal power equipment to enter into Iceland’s power market, NEXI would like to contribute to promoting business opportunities of Japanese companies in the renewable energy sector, and help the Japanese industry to maintain and strengthen international competitiveness.

As Japan’s official export credit agency, NEXI will continue to actively support Japanese exports.


Reference
Borrower Landsvirkjun (National Power Company)
Insured Citibank Japan Ltd.
The Bank of Yokohama, Ltd.
Commerzbank AG Tokyo Branch
Insured amount Approx. USD34 million
Tenor Approx.11 years
Covered risks Political and Commercial Risks (100%)
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