ICBC contributes $46.75 million USD to the $360 million USD term loan of a $700 million USD syndicated debt package for the 1050 MW CPV Fairview Energy Center Project

Project narrative

On March 27, 2017, financial close was reached on a deal in which a syndicate of 16 lenders — including the New York Branch of the Industrial and Commercial Bank of China (ICBC) — entered into a $700 million USD syndicated senior debt package agreement with CPV Fairview Energy Center, LLC — a Delaware-incorporated special purpose vehicle (SPV) and joint venture of American power generation developer Competitive Power Ventures, Inc. (CPV) (25% equity stake), GE Energy Financial Services, Inc. (EFS), a subsidiary of GE Capital, the financial services division of General Electric Inc. (25% equity stake), and Osaka Gas USA Corporation (OGUSA), a wholly owned subsidiary of Japanese utility Osaka Gas Co., Ltd. (50% equity stake) — for the 1050 MW CPV Fairview Energy Center Project. The debt package was divided six instruments: a $360.00 million USD construction term loan provided by 12 banks, a $57.00 million USD revolver facility, a $100.00 million USD fixed rate loan, a $30.00 million USD working capital facility, $115.00 million USD of fixed rate notes, and a PJM Reliability Pricing Model (RPM). The debt carried a maturity period of 8.25 years and a final maturity date of June 30, 2020. The $360 million USD construction term loan, the $57 million USD revolver facility, and the $30 million USD working capital facility carried an interest rate based on a variable rate. ICBC contributed $46.75 million USD to the $360 million USD term loan. In addition to ICBC, the following lenders contributed to the tranche: BNP Paribas S.A. ($20.86 million USD), CIT Bank, N.A. ($20.86 million USD), Commonwealth Bank of Australia (CBA) ($38.61 million USD), Crédit Agricole Corporate and Investment Bank (CACIB) ($20.86 million USD), DNB Markets, Inc. ($38.60 million USD), Landesbank Hessen-Thüringen (Helaba) ($35.00 million USD), Migdal Insurance and Financial Holdings Ltd. ($35.00 million USD), Bank of Tokyo-Mitsubishi UFJ, Ltd. (BTMU) ($20.86 million USD), National Australia Bank Limited (NAB) ($32.60 million USD), Woori Bank ($25.00 million USD), and Industrial Bank of Korea (IBK) ($25.00 million USD). BNP Paribas, CIT Bank, CBA, CACIB, DNB, BTMU, and NAB contributed to the $57 million USD revolver, with BNP Paribas and NAB each providing $8.15 million USD and the rest each contributing $8.14 million USD. IBK provided $75 million USD and Woori Bank provided $25 million USD to the $100 million USD fixed rate loan. BNP Paribas, CIT Bank, CACIB, BTMU, and NAB each contributed $6.00 million USD to the $30 million USD working capital facility. BNP Paribas and BTMU arranged the $115 million USD fixed rate notes, while Wells Fargo covered the $38 million USD PJM RPM. BNP Paribas, CACIB, BTMU, CIT Bank, and the New York Branch of ICBC served as initial coordinating lead arrangers. CBA and DNB Markets joined as coordinating lead arrangers. IBK was coordinating lead arranger for the fixed-rate bank tranche. The fixed-rate note tranche was placed in the institutional market. The loan was oversubscribed during syndication. The proceeds were to be used by the borrower to finance the construction of a 1,050 MW natural gas and ethane-fueled two-by-one combined-cycle electric generating station, the CPV Fairview Energy Center, located on a 30-acre brownfield site in Jackson Township, Cambria County, Pennsylvania, located north of Johnston and 60 miles east of Pittsburgh. The plant featured two high-efficiency air-cooled General Electric (GE) 7HA.02 natural gas turbines, a GE steam turbine, two heat recovery steam generators (HRSGs), and control equipment, a cooling tower, a natural gas-fired auxiliary boiler, two natural gas-fired dew point heaters, two ultra-low sulphur diesel (ULSD) fired emergency backup generators, and a firewater pump. HA turbines are cleaner, more reliable, and cost-effective convertors of fuel to electricity, with 62% combined cycle efficiency. The turbines and HRSGs would be equipped with a selective catalytic reduction (SCR) system to minimize nitrogen oxide (NOx) emissions and an oxidation catalyst to minimize carbon monoxide (CO) and volatile organic compound (VOC) emissions. The brownfield site that would host the project was to be cleaned up as part of the project. The plant would sell its capacity, energy, and ancillary services into the PJM Interconnection market, which it was connected to via the FirstEnergy/PJM 500kV transmission line, with a purpose-built electrical substation at the plant to link. Natural gas for the project would be sourced an interstate natural gas transmission line owned by Spectra Energy, with a proposed 12-inch diameter pipeline connecting that line to the plant. The plant had the capacity to power over one million homes. The project had a cost of $900 million USD, with $200 million USD in equity from the sponsors. The project was expected to create between 300 and 500 jobs during construction and 20 to 25 permanent positions when operational. The project was also expected to bring significant revenue for the State of Pennsylvania in sales tax during construction and new revenue for local governments and businesses; CPV announced that it would make an annual donation of $500,000 USD to Jackson Township for the life of the project, once operational. The project was expected to modernize the electric generation, improve reliability, and lower system-wide carbon emissions via efficiency with cleaner natural gas. Kiewit won the engineering, procurement, and construction (EPC) contractor for the project. GE won a contract for the supply of two gas turbines, a steam turbine, generators, and required control equipment. Other contractors included Charles J. Merlo, Inc., Laurel Management Company, and Cenergy. Stantec served as owner's engineer. Construction was expected to begin in fall 2017. The project was expected to begin commercial operations in early 2020. The groundbreaking ceremony was held on October 24, 2017. The plant began commercial operations on December 9, 2019. On February 14, 2020, financial close was reached on a deal in which a syndicate of banks entered into a $709.99 million USD syndicated loan agreement with CPV Fairview Energy Center, LLC to refinance the debt on the CPV Fairview Energy Center, including the $700 million USD debt from 2017.