Kilpilahti Power Plant Ltd – Construction and Financing of 450 MW Power Plant

We assisted Kilpilahti Power Plant Limited (KPP), a joint venture of Neste, Veolia and Borealis, in its major project financing arrangement in which KPP will build a new 450 MW power plant in Kilpilahti, Porvoo.

The total investment value of the power plant is about EUR 400 million, and the funding consortium included the European Investment Bank (EIB), the Nordic Investment Bank (NIB), and commercial banks including Bank of Tokyo-Mitsubishi UFJ (BTMU), ING, Nordea, Skandinaviska Enskilda Banken (SEB), and Unicredit. The Spanish-based Técnicas Reunidas is the main supplier for the construction project. The engineering company Neste Jacobs will implement connections and other infrastructure in the project to integrate the new power plant to Neste’s refinery and Borealis’ petrochemical plants.

In our role as KPP’s legal advisor, we drafted and negotiated a complex suite of bankable project financing agreements, including the relevant construction agreements. The now financed project is a logical continuation to the project in which we advised Neste in the construction agreements related to the construction of its asphaltene producing Solvent De-Asphaltening (SDA) unit. Asphaltene is one of the fuels to be used in the new power plant.

The role of Castrén & Snellman was pivotal in getting this extensive project closed and its comprehensive set of documentation completed. We consider this another great example of C&S assisting the employer and borrower successfully reaching financial close.