5 April, 2016
Allen & Overy has acted for the Advisory Services unit of the International Finance Corporation (IFC Advisory), in conjunction with the Ministry of Electric Power (MOEP) and the state-owned Myanmar Electric Power Enterprise (MEPE), on the signing of a Power Purchase Agreement (PPA) with Sembcorp Myingyan Power Company Limited (a subsidiary of Sembcorp Industries) in relation to the Myingyan IPP.
The 225 MW combined cycle gas-fired project is the first competitively awarded independent power project (IPP) to be developed in Myanmar. It will also be the first power project in Myanmar to benefit from multi-sourced project financing from development institutions (including the International Finance Corporation and the Asian Development Bank) and international commercial lenders (including Clifford Capital, DBS Bank, DZ Bank and Overseas-Chinese Banking Corporation), with debt and equity political risk coverage provided by the Multilateral Investment Guarantee Agency and the Asian Development Bank.
Commenting on the transaction, A&O partner Stephen Jaggs said: “This transaction represents an important milestone in the development of Myanmar’s power sector and demonstrates our position at the forefront of the Myanmar market.
The Myingyan IPP will be the most sophisticated project financing in Myanmar’s power sector to date and is a prime example of how government, private and multilateral parties can work together to fuel Myanmar’s growing participation in the global economy.”
The signing of the PPA for the project on 29 March 2016 represents the culmination of an extensive process of capacity building and knowledge sharing between the Myanmar Government and its commercial, technical and legal advisors (including IFC Advisory and Allen & Overy). The foundations for this transaction were laid as early as July 2013, when A&O was commissioned to produce a standard form PPA for the Myanmar Government. From the initial bid process through to expected financial close in mid-2016, A&O advised on all aspects of the project.
The A&O team was led by Bangkok-based partner Stephen Jaggs with support from an international team from Yangon, London and Sydney, including senior associates Chris Bishop, Chris Burkett and associates Josh Htet, Isabelle Whitehead and Jessica Lee.
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