Russia’s Vnesheconombank, otherwise known as VEB, has signed a contract with Iran’s Bank of Industry and Mine to finance a thermal power plant project in Hormozgan Province.
The contract has been signed by the representatives of the Central Bank of Iran and Thermal Power Plant Holding Company on September 5 in Moscow, BIM’s website reported.
TPPH is responsible for organizing government activities in the field of thermal power generation, including the planning, development, management and operation of its subsidiary plants based on the policies of Energy Ministry.
Hormozgan’s power plant project is planned to be implemented via the Russian government’s €1.2 billion loan and become operational within five years.
Iran’s Bank of Industry and Mine is the project’s agent bank through which the credits will be transferred.
According to the report, following this contract, BIM has paved the way for further cooperation between Iran and Russia, especially in the case of financing Iranian projects.
BIM was also the agent bank for a $1.5-billion loan from Exim Bank of China to finance the electrification of a 926-km railroad from Tehran to the eastern city of Mashhad in Khorasan Razavi Province. The financing contract, considered to be the first such deal after the removal of international nuclear sanctions against Iran, was signed in Tehran on July 26.
During negotiations with VEB, the Russian bank expressed interest in allocating short- and-long-term loans to Iran, without a guarantee from the government or the Russian Agency for Export Credit and Investment Insurance, only based on BIM’s creditworthiness.
VEB is a government-owned development bank tasked with providing funds for projects in Russia and foreign countries.