A team from the Beijing and London offices of international legal practice Norton Rose Group has advised trading and investment group Energy Financing Team (EFT) on the project financing of a €550 million, 300MW thermal power plant in Bosnia and Herzegovina.
The power plant represents the first significant investment from a Chinese lender in the Eastern European power market, via a €350 million loan provided by China Development Bank (CDB). Chinese developer Dongfang Electric Corporation will construct the power plant, which is scheduled to be operational in 2016 and will rely on lignite from a nearby mine run by EFT.
The EFT in-house legal team was led by Vojin Draskoci and Marija Kostic based in Belgrade. Norton Rose Group advised EFT on the project financing and the structuring of the concession agreement, power sales and Engineering, Procurement and Construction (EPC) arrangements.
Nigel Ward, partner, Norton Rose LLP, commented:
“The project represents the first major infrastructure asset for EFT, the first thermal power plant built in Europe by a Chinese contractor and using Chinese equipment, and the first project to be funded by a Chinese bank as part of the commitment made by China to Eastern and Central Europe infrastructure announced by Premier Wen. This groundbreaking project, undertaken against a challenging background for the development of thermal power in Europe, could not have been achieved without the vision of EFT and CDB and close co-operation with the local public authorities.”
“There is huge interest from China in infrastructure projects in Eastern and Central Europe, and indeed in Europe more generally, and Chinese contractors will be encouraged by the ability of the parties involved in this project to close the funding and so move from commitment to reality.”
Partners Nigel Ward in Beijing and Richard Metcalf in London led the team advising EFT, together with associates Jonathan Keats and Zhen Jin in Beijing.
Financial close was reached on 20 June 2012. Linklaters advised China Development Bank with local law advice in Bosnia and Herzegovina provided by Karanovic & Nikolic.
