Orrick and LVN Advise on Landmark China-Vietnam Energy Project

Orrick, Herrington & Sutcliffe LLP in association with LVN & Associates (LVN) has advised Thang Long Thermoelectric JSC (Thang Long) as investor and sole developer on an Engineering, Procurement and Construction (EPC) contract worth US$645 million with Wuhan Kaidi Electric Power Co., Ltd. (Kaidi).

Thang Long is a subsidiary of the General Export and Import Company (Geleximco), which is one of Vietnam’s leading power generation companies, as well as being involved in the real estate development, infrastructure development, manufacturing and banking sectors in Vietnam.  Kaidi is a major provider of engineering, design and contracting services based in Hubei, China, and is listed on the Shenzhen Stock Exchange.

The EPC contract relates to the 600 MW Thang Long coal-fired thermal power plant in Vietnam. The plant will be located in the coal-rich province of Quang Ninh Province and is expected to be completed by 2015.

A team of Hong Kong and Vietnam-based global finance lawyers, led by Orrick partner Christopher Stephens and LVN partner Doan Quynh Linh, advised Thang Long on the contract.  Orrick has now advised on three of the most recent large-scale EPC contracts completed in Vietnam, underscoring Orrick’s market leadership in advising parties in EPC contracting matters.

Christopher Stephens said: “We are pleased to have represented Thang Long as the sponsor on this landmark China-Vietnam energy project.  Orrick has a strong global energy practice and many years of experience both in China and Vietnam. The further development of Vietnam’s power generation capability is a priority for the government in Vietnam and we’re seeing many opportunities for international investors, equipment suppliers, service providers and lenders to come into Vietnam.”

“EPC contracts involve a complex yet critically important allocation of a range of construction and project-related risks, including risks affecting project timelines and progress milestones, risks arising from changes in the laws in several countries, events of force majeure, political risks, equipment and systems performance and project pricing.  Advising clients on EPC contracts requires a breadth of skills and expertise, including specialists in commercial contracting, design and engineering, intellectual property, environmental regulation, tax and financing,” Stephens explained.

Doan Quynh Linh added: “These projects require an in-depth knowledge and understanding of local law and market practice that enable project participants to anticipate the issues and requirements of multiple parties.  Having advised on the majority of Vietnam’s existing and ongoing power projects, Orrick and LVN’s cross-border team of lawyers is well positioned to advise both local and international clients on such complex, cross-border energy projects.”

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