Interchile secures $770m for transmission scheme

A syndicate of six international financiers are providing $770 million to Colombian state-owned Interconexion Electrica SA (ISA) subsidiary Interchile for the development of the Cardones-Polpaico transmission project.  

The lending parties comprise BBVA, Bank of Tokyo-Mitsubishi UFJ, Sumitomo Mitsui Banking Corp, Natixis, Crédit Agricole and Banco del Estado de Chile, which are due to provide roughly 70 percent of needed capital to construct the $1 billion project, according to lender adviser Milbank, Tweed, Hadley & McCloy.

Three banks – BBVA, Banco Estado de Chile, and Banco BICE – also came together to secure a $68 million tax facility for Interchile to support project development.

The project is ISA's first foray into the Chilean power market, Milbank noted in a statement. It includes three 500kV double circuit transmission lines with a total length of 680 miles, which will serve growing energy needs in the centre and south of Chile and mining operations in the north.

“Chile's electricity sector has been a model for the region in its embrace of private investment,” said Milbank head of global project finance group Dan Bartfield. “Securing financing for the Cardones-Polpaico project is another step in assuring ample electric power for an expanding economy.”  

All three Cardones-Polpaico transmission lines are expected to enter operations by 2017 end.