TISCO to resume expansion project
TISCO to resume expansion project
Thai Nguyen Iron and Steel Joint Stock Corporation (TISCO) has officially restarted the second phase of its expansion.
Last week, negotiations between TISCO and the contractor, China Metallurgical Group Corporation (MCC), were brought to a close. The official results have not been announced as of the moment, but the project, which has been suspended since the first quarter of 2013, will continue, according to TISCO.
Tran Van Kham, TISCO’s general director, said the nearly VND1.4 trillion ($62.3 million) loan it received from the Vietnam Development Bank (VDB)'s Bac Kan–Thai Nguyen branch at the end of January was what enabled TISCO to restart negotiations with MCC.
“MCC was financially unable to see to the end of the construction phase of the EPC contract. But they said when they have the capital they will finish the remaining work,” he said.
TISCO is still negotiating a VND1.1 trillion ($52 million) loan with Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank). However, the financial shortage, “the main difficulty of the project,” according to Kham, “has been basically solved.” Kham also mentioned TISCO’s VND1 trillion ($47 million) share sale to the State Capital Investment Corporation (SCIC) in December last year, to further stress the company’s enhanced financial capacities.
VDB and VietinBank have both lent money to the project earlier, but because the project was dragged out longer than expected, stopped disbursing the money. Of the VND1.6 trillion ($75 million) that VDB pledged to lend to TISCO back in May 2006, about a year before the project started, the bank has only disbursed VND1.4 trillion ($66 million).
For the new loan that TISCO has just received from VDB Bac Kan–Thai Nguyen branch, “the disbursement also depends on how fast TISCO carries out the project,” Tran Duc Thang, director of the branch said.
