Hainan Meinan Power Company CJV

MIGA issued a $16.7 million guarantee to Atlantic Commercial Finance, B.V., of the Netherlands, a wholly owned subsidiary of Enron Corporation of the United States, for its equity investment in a 150-megawatt combined cycle diesel power plant on the east coast of Hainan Island, China. MIGA's guarantee covers the risks of currency transfer, expropriation, and war and civil disturbance.

The project enterprise, Hainan Meinan Power Company CJV (HMPC), is an intermediate load plant, designed specifically to overcome some of the province's power problems. The existing coal-fired and hydroelectric plants in Hainan are large and can provide generating capacity only in large increments; they involve a cumbersome manual system to determine electricity requirements. The HMPC plant, which is customized to respond automatically to fluctuations in demand, will help eliminate power outages and assist in accurate matching of output with demand.

The project will represent about 13 percent of Hainan's current installed power capacity and contribute significantly to the growth prospects of the local economy. Approximately 850 local nationals were hired during the construction phase. Employees are receiving technical training and English-language education. In addition, the project will provide more than $34 million in local tax revenues over the first five years of operation.

Measures have been taken to ensure that thermal discharges and emissions of sulphur dioxide and nitrogen oxide conform to relevant World Bank guidelines. The plant also has a comprehensive oil spill contingency plan and has put in place noise abatement measures.