Bangladesh-China Power Company (BCPCL) will spend $1.56bn to construct a coal-fired power plant near proposed Payra sea port.
The power plant will consist of two units with a capacity of 660MW each and it will be build at Payra in Patuakhali district, 199 miles south of Dhaka.
While the first unit is expected to be ready for electricity supply by April 2019, the second one will be operational six months later.
BCPCL is a 50:50 JV between China National Machinery Import and Export and Bangladesh’s state-owned North-West Power Generation.
BCPCL managing director Khurshidul Alam told Reuters that 80% of the investment will be funded through loans from Chinese banks.
"To implement the project, both signed an agreement late on Tuesday, with equal ownership and 20 percent equity," Alam said.
Alam said the coal requirements of the plant will be met through imports from Indonesia, China and Australia. The plant is expected to consume 12,000tof coal daily.
"The Payra power plant will not only provide power, but also create a host of coal-based infrastructure projects, creating decent paying jobs," Alam added.
BCPCL has signed an engineering, procurement and construction (EPC) contract with a consortium of two Chinese companies for the construction of the plant.
Officials of the consortium of First Northeast Electric Power Engineering Company (NEPC) of China and China National Energy Engineering and Construction Company (CECC) have signed an agreement with BCPCL, Xinhua reported.
Bangladesh has to generate 24,000MW of power daily by 2021 to meet the growing demand. Currently, the country produces 8,500MW of power per day.