China Development Bank provides EUR 350 million buyer’s credit loan for 300 MW Stanari Thermal Power Plant Project

On February 19, 2008, the Government of the Republic of Srpska granted a 30-year concession to Energy Financing Team (EFT) Group — a private British company — to construct and operate the 300-megawatt Stanari power plant power plant and mine near the town of Doboj within Republika Srpska. Then, on June 20, 2012, China Development Bank (CDB) and EFT Rudnik i Termoelektrana Stanari d.o.o. — a special purpose vehicle owned by EFT Group and incorporated under the laws of Republika Srpska (registration number 4400106370004) — signed an EUR 350 million term loan (facility) agreement for the 300 MW Stanari Thermal Power Plant Project. The loan carried a 14 year maturity and a 4 year grace period. Its interest rate is unknown. The Government of Bosnia and Herzegovina did not issue a sovereign guarantee in support of the loan. However, EFT (Holdings) ApS and EFT International Investment Holdings Limited both issued repayment guarantees. The borrower also purchased a buyer’s credit insurance policy from Sinosure. As an additional credit enhancement, all of the assets and future profits of EFT Rudnik i Termoelektrana Stanari d.o.o. were pledged as sources of collateral to CDB in the event that the borrower could not repay the loan (and the Concessions Commission of the Government of the Republic of Srpska had to make an adjustment to its own rules to ensure that CDB could dispose of the 2008 concession agreement in the event that EFT Rudnik i Termoelektrana Stanari d.o.o. was not able to meet its repayment obligations under the loan agreement). The borrower pledged its cash deposits in a set of onshore and offshore bank accounts, a mortgage on land and buildings, monetary claims and receivables under certain power purchase agreements, among other things. The proceeds of the CDB loan were used by the borrower/concessionaire (EFT Group) to partially finance an EPC contract that it signed with Dongfang Electric Corporation (DEC) on May 5, 2010. The 300 MW Stanari Thermal Power Plant Project was implemented on a Build-Operate-Transfer (BOT) basis and it was reportedly financed according to a 80:20 debt-to-equity ratio. The purpose of the project was to construct a 300-megawatt (MW) coal-fired power plant near the town of Stanari, 70 km east of the city of Banja Luka. The power plant was to be fueled by lignite from the nearby Stanari lignite mine. Upon completion, the power plant was expected to generate 900 permanent jobs and 2,000 gigawatt-hours (GWhs) of electricit each year. DEC was the EPC contractor responsible for implementation. The first CDB loan disbursement took place on December 24, 2012. Then, in April 2013, excavation work for the foundation of the power plant commenced. A groundbreaking ceremony took place on May 18, 2013. The EPC contractor handed over the power plant to EFT Group on August 8, 2016. The power plant reached its commercial operation date on September 20, 2016.

Additional details

1. This project is also known as the 300 MW Stanari Coal-Fired Power Plant Project. The Bosnian project title is Термоелектрана Станари. The Chinese project title is 斯坦纳瑞坑口燃煤电站项目 or 斯坦纳里燃煤电站. 2. The ‘EFT UK Account Agreement’ can be accessed in its entirety via https://www.dropbox.com/s/abljctekrrmmveg/CDB%20Loan%20for%20Stanari%20Power%20Plant%20Assignment%20of%20EFT%20UK%20Account%20Agreement.pdf?dl=0. 3. The ‘Charge Over Deposit and Account Agreement’ can be accessed in its entirety via https://www.dropbox.com/s/jqm8ndd9vjdi0yj/17%20December%202017%20Charge%20Over%20Deposit%20and%20Account%20for%20CDB%20Loan%20for%20Stanari%20Power%20Plant.pdf?dl=0. 4. The ‘Deed of Security’ can be accessed in its entirety via https://www.dropbox.com/s/7lqpczq57ldlk1r/10%20October%202013%20Deed%20of%20Security%20for%20CDB%20Loan%20for%20Stanari%20Power%20Project.pdf?dl=0. 5. The ‘Share Pledge Agreement’ can be accessed in its entirety via https://www.dropbox.com/s/7mrlfu72rhv0lfb/20%20June%202012%20Share%20Pledge%20Agreement%20for%20CDB%20Loan%20for%20Stanari%20Power%20Plant%20Project.pdf?dl=0. 6. The ‘Assignment of Guarantor's Compensation Proceeds Agreement’ can be accessed in its entirety via https://www.dropbox.com/s/9gi37nrxl3lbzv8/Assignment%20of%20Guarantor%27s%20Compensation%20Proceeds%20Agreement%20for%20CDB%20Loan%20for%20Stanari%20Power%20Project.pdf?dl=0. 7. The ‘Assignment of Shareholder Loan Agreement’ can be accessed in its entirety via https://www.dropbox.com/s/zh3mm9cfe4z8ql8/Assignment%20of%20Shareholder%20Loan%20to%20CDB%20for%20Stanari%20Power%20Project.pdf?dl=0.

Number of official sources

29

Number of total sources

53