By Gary Hatigeva
THE Korean Water contracted to build and operate the Tina Hydro Project in East Guadalcanal is revealed to have pumped in a total of $20 Million US dollars as its contribution into the project based on the investment structures for the power project.
This, according to the Minister for Mines, Energy and Rural Electrification and Member of Parliament for East Guadalcanal, Bradley Tovusia is a 50 percent cut to the original outline in the structure.
When responding to a supplementary question by the former Finance Minister and MP for Marovo, Snyder Rini who asked about the Korean company’s share of contribution into the project, Minister Tovusia explained that Korean Water was supposed to give 40 million as initiated.
“But with the interest that the company will raise its tariff, the government has decided for the investor to pump in only 20 million US Dollars.
“And that,” the Minister added, “would reduce tariff and with the idea to get additional funds from the country’s donor and development partners will see to the rest of the cost to ensure the project is eventuated,” Minister Tovusia added.
Based on figures revealed on the floor of parliament regarding finances involved in the project, a total of over $100 million USD is expected to be borrowed from international commercial institutions, which includes a total of around 87 million soft loan from GCF, EDCF with over 30 million, World Bank with a soft loan of around 34.7 million.
Meanwhile, documents are being finalized on the agreement to also get an additional soft loan of around 18 Million US dollars from the Asia Development Bank.
The Australian government on the other according to the Finance Minister, is also contributed around $17 million for the project, which includes the construction of access to the project site.
But when questioned over who will shoulder the cost of the highlighted loan repayments, the Minister assured that the project, once it is up and running and starts making profits, which he is confident it will, all the costs outlined will be paid by the operation.
With intentions and proposals including the structure of investment for the project, which according to both ministers strive to provide supply power at the lowest rates as possible, the Member of Parliament for Aoke/Langalanga, Matthew Wale commended the government for it and stressed the need to see that the project is operational for the sake of the people.
The Aoke/Langalanga MP expressed his appreciations on the government’s approach to get Korean Water to go as low as possible with its costs of tariff and urged them to also consider lowering all costs involved in the initiation of what he described as a very important project as far as development in the country is concerned.