Shearman & Sterling advised The Export-Import Bank of China, China Development Bank, Silk Road Fund and International Finance Corporation in connection with the development and financing of the US$1.69 billion (approved total investment) 720 MW Karot hydropower plant in Pakistan, the largest hydropower plant in Pakistan to be financed on a limited-recourse basis.
This project represents one of the three multistage hydropower projects in Pakistan being developed by China Three Gorges South Asia Investment Limited, an independent power company established by China Three Gorges Corporation, International Finance Corporation and Silk Road Fund, which was structured as a scalable investment platform to develop and own renewable power projects in Pakistan.
Karot is located on the Jhelum River and the Province of Punjab, Pakistan and is expected to achieve commercial operations by 2021. The project is also listed as one of the priority projects of the China Pakistan Economic Corridor, a key component of China’s One Belt One Road initiative.
Shearman & Sterling’s Project Development & Finance team has established a leading presence in Pakistan’s hydropower sector in recent years, having advised on the financing of the New Bong Escape, Patrind and Gulpur projects. The team has a reputation for its expertise in the hydro sector – the firm recently advised on the Asahan hydro project in Indonesia and is currently advising on the Upper Trishuli hydro project in Nepal.
The Shearman & Sterling team included partner Bill McCormack; counsel Alfred Ng (both Singapore-Project Development & Finance); and associates Claude Jiang (Shanghai-Project Development & Finance), Chad Passlow (Singapore-Project Development & Finance) and Chongxiao Liu (Hong Kong-Project Development & Finance).