DeHeng Advised China Development Bank
in Financing of Hydropower Plant San Gaban III
by China Three Gorges Corporation in Peru
2017-12-27
The
cross border transactions practice of DeHeng Law Offices in Beijing
recently advised China Development Bank in advancing a credit facility
to the Peruvian subsidiary of China Three Gorges Corporation to finance
construction of Hydropower Plant San Gaban III in Peru.
DeHeng acted as lead counsel for this project in association with Peruvian, Hong Kong, English, Portuguese and Spanish local counsels for legal aspects in respective jurisdictions. The multi-jurisdiction legal team conducted a due diligence over the project, drafted and negotiated key financing and project documents, and supported release of the funds.
During President Xi Jinping's visit to Peru, a memorandum for financing of Hydropower Plant San Gaban III was signed by China Three Gorges Corporation, Energias de Portugal S.A., China Development Bank and the Peruvian Ministry of Energy and Mines. The project is the only hydropower power plant among the 18 projects that form the second round of early-stage harvest projects between China and Peru under a capacity cooperation framework. Hydropower Plant San Gaban III is a project of significant importance to Peru jointly invested by China Three Gorges Corporation and Energias de Portugal S.A. Construction is expected to greatly deepen China-Peru bilateral ties and economic cooperation, ease electricity deficits suffered by southeast Peru, and promote regional economic development and all-round social progress.
This project followed a commonly used structure for international project financing. The financial documents were drafted in conformity with the LMA (Loan Market Association) and the ISDA (International Swaps and Derivatives Association) recommended forms.
The DeHeng team in Beijing was led by banking and finance partner Zhang Xu with the primary support of counsels Feng Chen and Shen Sisi. Legal assistants Li Fan and Guo Yun provided support.
