Turning Plan B back into Plan A
In late May 2020, having secured financing for the fallback Plan B, to secure rights to access a Palau Branching Unit on the trunk through AUSAID and Australian Infrastructure Financing Facility for the Pacific (AIFFP), BSCC began discussions with the Ambassadors of the USA, Japan, and Australia. The idea was to improve the financing structure to make up-front, full installation the second cable (PC2) feasible. With further grants from USAID and AIFFP, and with Republic of Palau / USA Compact funds, there looked to be a way.
Last week, on January 13th 2021, those discussions bore full fruit, with debt financing agreements signed by the Republic of Palau, BSCC, Export Finance Australia (EFA), AIFFP, Japan Bank for International Cooperation (JBIC) and Sumitomo Mitsui Banking Corporation (SMBC).
The signing ceremony, conducted at the Office of the President annexe at Meyuns, was attended by some of the many people here in Palau, and through WEBEX by others in Palau, USA, Australia and Japan, who made PC2 possible.
President Tommy E Remengesau Jr holds a sample of lightweight submarine cable, flanked on his right by authorised signatories Ambassador Richelle Turner, Minister of Finance Elbuchel Sadang and BSCC Treasurer Eric Whipps. Standing behind is President Elect Surangel Whipps Jr with USA Ambassador John Hennessy-Niland and Japan Ambassador Akira Karasawa to his right. Thanks to Alpert Pictures for the photo.
Building submarine cable networks is a lot like making movies: one of the hardest tasks is getting the money. One reason for that is you must have a good script. BSCC is delighted to have the money lined up for PC2, a huge milestone.
There have been several related press releases:
NEXI (SMBC’s insurers)
https://www.nexi.go.jp/en/topics/newsrelease/2021011301.html
NEC (the Palau system supplier)
AIFFP (which includes a video)
https://www.aiffp.gov.au/news/aiffp-signs-loan-agreement-palau-undersea-cable
Next Steps for PC2
We have already signed with system supplier NEC, the Japanese electronics giant, and are putting the final touches to the agreements with Trans-Pacific Networks (TPN), our supplier of capacity on the Echo trunk and of access rights to the Branching Unit. Once the TPN agreements are in place, some technical conditions of the lenders are met, and some of the grant components are completed, all the necessary elements to support the project will be in place. We expect this to be completed in February 2021.
We can expect the system design to be finalised in Q1 2021, and then manufacturing and component testing will commence.
Meanwhile, later in 2021 BSCC will begin local procurement for civil works, beach manhole and duct routes, and cable landing station construction.
Installation will be completed in 2022, with a Pre-Lay Shore End likely (as was required for PC1). The new network should be in service in 2023.
Westside Fiber starting to deliver side benefits
BSCC has provided additional fibers on its network extension Ngeremlengui to Airai to each Palau Retail Service Provider (RSP). These fibers are part of Palau’s shared wholesale infrastructure, and can be used to augment RSP’s network plans, extending their reach around Babeldaob. The first of these “add/drop” applications is now under way, with PNCC looking to use the fiber to improve services at Koksai.
Here is the Koksai add/drop shutter-box. It was filled with water when it was opened, demonstrating how optical fiber technology is impervious to water – a significant issue here in Palau, where conditions can become damp.
Once the first add/drop is completed and in service, more are already planned at different locations along the route.