6 February, 2014
Allen & Overy has advised Xe-Pian Xe-Namnoy Power Company Limited and its sponsors in connection with the USD1.02bn, 410MW Xe-Pian and Xe-Namnoy cross-border hydropower project located in the Lao People’s Democratic Republic. The firm advised the sponsors, a group comprising SK Engineering & Construction Co., Ltd., Korea Western Power Co., Ltd., Ratchaburi Electricity Generating Holding Public Company Limited and Lao Holding State Enterprise, on all aspects of the development, financing and construction of the project.
Stephen Jaggs led the Allen & Overy team from Bangkok with support from lawyers Anchalee Limviriyalers, Chris Bishop, Sadi Tanmanatragul, Sarah Wilson, Vorasaree Wangwittiya, Adam Reekie, Matthew Del Rosso, Wipawat Yingsakmongkol and Monsicha Pongrujikorn. Charlie Grover in Singapore provided support on the construction and operation arrangements with assistance from Kyle Sanderson and Matt Chow.
Commenting, Allen & Overy partner Stephen Jaggs said: “It is pleasing to have been able to work with Korean sponsors on their first major investment in the Lao hydropower sector and with Ratchaburi Electricity Generating Holding Public Company Limited on this important project for Thailand. Under the offtake arrangements, 90 percent of the generating capacity of the project will be distributed to the Electricity Generating Authority of Thailand under a 27-year power purchase agreement, the remainder will feed into the Lao electricity grid. Also of note is that the project financing, consisting of a syndicated multi-tranche and multi-currency debt structure, is fully financed by Thai banks which demonstrates continuing strong support from Thai financial institutions for regional power projects”.
Other law firms advising on the project include Chandler and Thong-Ek Law Offices Limited as the lenders’ Thai counsel; DFDL (in Laos) as Lao local counsel to both sponsors and lenders (two separate teams); Latham & Watkins as the lenders’ deal counsel; and Shin & Kim as the sponsors’ Korean counsel.
The project, which achieved financial close on 5 February 2014, is a joint venture between the Lao government and a consortium of private-sector sponsors. This is the first significant investment by Korean sponsors in the Lao hydropower sector. It will take approximately five years to complete and is scheduled to start commercial operations in 2019.
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