Milbank LLP advised the Chinese engineering procurement and construction firm CITIC Construction Co., Ltd. (“CITIC”) as credit provider and EPC contractor in connection with a deferred payment agreement (the “DPA”) for the construction and development of the 750 MW Maisan Combined Cycle Power Plant in the Missan Governorate in the Republic of Iraq valued at over US$2 billion. The deal is the first of its kind to succeed in Iraq.
Pursuant to the DPA, CITIC will assign receivables under the EPC contract in connection with the construction of the power plant to certain funding banks which will then make funds available for CITIC to discharge its obligations under the DPA as the credit provider. The funding banks in this deal include the Industrial and Commercial Bank of China, the Export-Import Bank of China and China Minsheng Banking Corporation, Ltd.
The Milbank Global Project, Energy and Infrastructure Finance team was led by partner Shepard Liu in Beijing and partner Aled Davies in Tokyo, with associates Aaron Mundy in Tokyo, Jenny Zhang in Singapore, and legal assistants Emma Pan in Beijing and Marcia Song in Beijing.
Mr. Liu said: “We are very proud of our team’s role on this landmark deal in Iraq, which involved structuring a highly sophisticated agreement that accommodated many non-traditional elements in this financing. The success of this deal is a testament to Milbank’s ability to provide innovative solutions that facilitate clients’ most complex and groundbreaking transactions.”
Mr. Davies added: “This multi-jurisdictional deal required seamless collaboration between our cross-border team of attorneys and a number of international players. We are thrilled to have been a part of this massive effort to bring power to millions of Iraqi citizens and look forward to continuing our work on impactful energy financings across the world.”
