China Eximbank provides $81.5 million buyer's credit for 51MW La Herradura Phase I Wind Farm Project (Linked to Project ID#70019)

The La Herradura Wind Farm Project was initially approved in December 2013, when Goldwind Science and Technology Co and AVIC International Holding Corporation established a consortium and jointly signed a commercial contract for the 51MW Phase I Project with Empresa Importadora-Exportadora de Objetivos Electro-Energéticos (“Energoimport”). Then, in April 2016, China Eximbank approved planning activities for the project's lending arrangement, which was followed by the approval of underwriting by Sinosure. However, the Cuban Government proposed changes to the clauses in the loan agreements, which resulted in the reopening of contract negotiation from July 2016. After almost an entire year’s effort, all the details in the financing agreements were agreed upon by the parties. Then, on June 23, 2017, China Eximbank and the Government of Cuba signed a $81.5 million buyer's credit loan (BCL) agreement for the 51MW La Herradura Phase I Wind Farm Project (captured via Project ID#70018) and a $78.2 million buyer's credit loan (BCL) agreement for the La Herradura Phase II Wind Farm Project (captured via Project ID#70019). The BCLs entered into force on September 13, 2017. The borrowing terms of the loans are unknown. However, it is known that they were both backed by buyer's credit insurance from Sinosure. Phase I involves the installation of 34 [GW 77/1500 PMDD] Goldwind wind turbines measuring 65 meters in height with three 37-meter blades, generating 1.5 MW of power distributed in five circuits. The total amount of planned power generation capacity under Phase I is 51MW. Upon completion, Phase I is expected to save Cuba nearly 40,000 tons of fuel a year, and stop nearly 130,000 tons of carbon dioxide (CO2) from being released into the atmosphere. Phase II involves the installation of 20 Dongfang wind turbines of 2.5 MW each, which will contribute a total of 50 MW to Cuba's electric grid. Phase I and Phase II of the La Herradura Wind Farm Project are together expected to generate around 101 megawatts (MW) of energy that will be fed into the National Electric System. The La Herradura Wind Farm is located in the Jesús Menéndez municipality within Las Tunas province, 600 kilometers east of Havana. Goldwind Science and Technology Co. and Dongfang Electric Corporation are the contractors responsible for project implementation. A commercial shipping vessel named the BBC Moonstone arrived in Tianjin, China on December 24, 2018 to pick up equipment for the La Herradura Wind Farm Project. The BBC Moonstone departed Tianjin on December 25, 2018 for the Panama Canal. On January 26, 2019, the BBC Moonstone arrived at the Panama Canal, and proceeded to travel to Florida. On January 30, 2019, the BBC Moonstone—carrying the project equipment for receipt by Energoimport, a Cuban state-owned entity—entered the Miami Seaport in apparent violation of United States sanctions on Cuba. None of the wind farm equipment for receipt by Energoimport was unloaded in Miami. In fact, while in Miami, no cargo on the BBC Moonstone was unloaded. Instead, the BBC Moonstone 'bunkered,' meaning it refueled and resupplied, at the Miami Seaport. Refueling and resupplying the BBC Moonstone enabled it to immediately proceed to Puerto Carupano in Cuba to unload the wind farm equipment. Later that same day, on January 30, 2019, the BBC Moonstone departed the Port of Miami but falsely reported to Miami Seaport officials that the BBC Moonstone’s next destination would be the Dominican Republic. On February 4, 2019, the BBC Moonstone arrived at Puerto Carupano in Cuba, and over the course of three days, unloaded the project equipment, delivering it to Energoimport for transportation by road to the project site. Phase I construction activities began on March 11, 2019. More than a year later, on June 6, 2020, Phase I and Phase II implementation activities were still underway. At that time, 20 wind turbines (that were part of Phase I) had been installed. Satellite imagery from July 2020 also demonstrates that holes had been dug for additional wind turbine bases but the holes sat flooded with water. Phases I and II were originally expected to reach completion by the end of 2018. The La Herradura Wind Farm Project project has become a subject of litigation in the United States. On June 15, 2020, North American Sugar Industries Incorporated (“American Sugar”) sued Xinjiang Goldwind Science & Technology Co. (“Goldwing”), Ltd., Goldwind International Holdings (HK) Ltd., DSV Air & Sea Inc., BBC Chartering USA LLC. and BBC Chartering Singapore PTE Ltd. under the Cuban Liberty and Democratic Solidarity (Freedom) Act of 1996 (“Helms-Burton Act"). North American Sugar Industries, Inc. claimed that one of its confiscated shipping ports in Cuba, Puerto Carupano, was used by the defendants to deliver equipment to the nearby Herradura Wind Farm Project, the largest wind power project in Cuba. Specifically, American Sugar claims that two Chinese companies — Xinjiang Goldwind Science & Technology, Co. and Goldwind International Holdings (HK) Ltd. — transported their wind turbines and related equipment through the port on the way to the La Herradura Wind Farm Project. North American Sugar Industries, Inc. further claimed that the shipment was carried in vessels chartered and operated by BBC Chartering USA, LLC and BBC Chartering Singapore PTE Ltd., and that DSV Air & Sea Inc. provided additional transportation and logistical services. North American Sugar Industries, Inc. has sued all five companies, alleging that they “trafficked” within the meaning of Title III by using its confiscated port (Puerto Carupano) to transport the necessary equipment for the La Herradura Wind Farm Project or by profiting from that transportation.

Additional details

1. The Spanish project title is Proyecto Parque Eólico de 51 MW, La Herradura. The Chinese project title is LA HERRADURA风电园.

Number of official sources

9

Number of total sources

19