August 31, 2018
Kobe Steel, Ltd.
Kobe Steel, Ltd. announces that it has decided to use project finance to procure funds for its electric power supply business in Kobe, Hyogo Prefecture, Japan. Today, project finance was arranged with Kobelco Power Kobe No. 2, Inc. as the borrower.
Kobe Steel announced on April 4, 2018 that it would conduct a company split (simplified incorporation-type company split) of its power generation business in Kobe, Hyogo Prefecture. Aiming to construct a coal-fired power plant in Kobe, Hyogo Prefecture, Kobe Steel entered into a power supply contract with The Kansai Electric Power, Inc. in March 2015. In addition, to procure financing for this power plant, Kobe Steel established Kobelco Power Kobe No. 2, Inc. in March 2018, for the purpose of supplying electric power, through the simplified incorporation-type company split.
For the project in Kobe, all procedures for the environmental impact assessment report have been completed following the ending of the inspection period of the report on June 25. In addition, on August 30, Kobe Steel entered into an environmental preservation agreement with the city of Kobe. Kobe Steel will promptly begin construction and aims to start up the No. 3 unit in fiscal 2021.
Kobe Steel examined ways for financing from various perspectives and decided on project finance for the reasons below.
Project finance is a method of financing where only the earnings generated from a specific business is used as the source of repayment of debt.
Outline of Kobe Steel’s electric power supply business
|(In operation)||(Under construction)||(Under planning)|
|Company name:||Kobelco Power Kobe, Inc.*||Kobelco Power Moka, Inc.||Kobelco Power Kobe No. 2, Inc.|
|Address:||2, Nadahama Higashicho, Nada-ku, Kobe, Hyogo (within Kobe Works)||15, Kinugaoka
|2, Nadahama Higashicho, Nada-ku, Kobe, Hyogo (within Kobe Works)|
(700,000 kW x 2)
(624,000 kW x 2)
(650,000 kW x 2)
|Pulverized coal-fired, supercritical pressure power generation (SC)||Gas turbine combined cycle (GTCC)||Pulverized coal-fired, ultra-supercritical pressure power generation (USC)|
|No. 1 unit: April 2002
No. 2 unit: April 2004
|No. 1 unit: 2H 2019
No. 2 unit: 1H 2020
|No. 3 unit: FY2021
No. 4 unit: FY2022
* On April 1, 2016, Shinko Kobe Power Inc. changed its name to Kobelco Power Kobe, Inc.
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