in

25th January 2005 – LAWFUEL – The Law News Network -The US$880 milli…

25th January 2005 – LAWFUEL – The Law News Network -The US$880 million Guangdong LNG Terminal and Trunkline Project, China’s first liquefied natural gas (LNG) import project and one of its largest gas development projects, has won numerous awards, signifying its role as a precedent for other LNG and infrastructure projects in the region. The first non-recourse deal in China, financed purely by Chinese banks while using international financing techniques and standards, it has recently been awarded the following accolades:

• “Asia Pacific Oil & Gas Deal of the Year” – Project Finance International

• “Best Project Finance Deal of 2004” – FinanceAsia

• “Best Project Finance deal of the Year 2004” – Asiamoney

• “China Energy & Resources Deal of the Year” – Asian Legal Business

In addition, Jones Day was named “Best Project Finance House” at the recent FinanceAsia Achievement Awards, held in Hong Kong on 21st January 2005.

Jones Day represented the project company and its sponsors, led by China National Offshore Oil Corporation and BP, from the earliest stages. Partners Bruce Schulberg (Hong Kong), Emad Khalil (Singapore) and Peter Roberts (London) headed the team of lawyers on the development and financing of the project, beginning with the selection of BP as the foreign partner in 2001.

The Guangdong LNG Terminal and Trunkline Project is located near Dapeng village, east of Shenzhen, in Guangdong Province. It will have an initial capacity of 3.7 million tones a year and 370 million kilometers of trunklines stretching from Shenzhen through to Dongguan, Guangzhou, Foshan and Zhujiang to supply natural gas to city gas and power plants in Guangdong and Hong Kong. When completed, the project will supply imported gas from the North West Shelf Project, Australia to Chinese customers in the Pearl River Delta, Guangdong Province and Hong Kong.

For power-starved Guangdong Province and neighboring Hong Kong, next year’s first LNG deliveries promise a much-needed supplement to existing fuels, and as shipments increase, a replacement for the environmentally damaging high-emissions coal which is now the staple energy source. For the PRC, the project is an administrative template for future LNG development and other large-scale infrastructure improvements. The entire Asia Pacific region should benefit from the project’s role in awakening China’s banking sector to the possibilities of non-recourse financing.

British MP George Galloway and his opponent the Daily Telegraph will leave no stone unturned to sort out what could be a spectacular libel case.