Fauji Kuttikun I Wind Farm

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Foundation Wind (Fauji Foundation), in 2011 still called Beacon Energy Ltd., was planning the development of the 50MW Wind Farm in Kuttikun, Sindh Province, Pakistan. Islamic Infrastructure Fund (from ADB) also holds 35% in the project. The project had been awarded land by the government of Pakistan for the 50MW project. The EPC contract (date certain, lump-sum, fixed-price) was awarded to Descon and Nordex, supplying its Nacelle N100/2.5 HCV turbines (40x). The project was connected to the grid via a 132kV transmission line, not included in the project but developed by the National Transmission and Dispatch Company (NTDC), grid operator. The project was developed under a BOO contract, with a 20 year PPA with NTDC, guaranteed by the central government. The electricity tariff bears the interest rate risk and currency exchange risk, via the islamic financing. The tariff allows for a guaranteed return of 17%. The central government provides a wind risk guarantee. In December 2011 it was reported by NEPRA that the tariff awarded by the NEPRA to Green Power was $10.2852 per kWh, after three review sessions. Total project cost for Kuttikun 1 and 2 (50MW + 50MW) was US$ 270 million. Financing was provided by National Bank of Pakistan (MLA), Faysal Bank, United Bank, Allied Bank of Pakistan, and Meezan Bank, as well as the Islamic Development Bank. Financial adviser to the sponsors were Meezan Bank and Bridgefactor. Legal advisor to the sponsor was Orr Dignam & Company. Legal advisor to the lenders were Shearman & Sterling, as well as Haidermota & Company. The total debt was US$ 204 million. The equity was US$ 66 million. The debt/equity ratio was 76/24. The tranches were divided as follows: Islamic financing: Ijarah and Musharaka (@295 bp) Tranche 1: Musharaka, Rupee denominated. The Musharaka tranche was lead-arranged by National Bank of Pakistan, and followed by United Bank, Allied Bank and Meezan Bank. The tranche was around US$68 million, but exact amount not available. Tranche 2: Ijarah, USD denominated Islamic Development Bank provides literal working capital, over which the project pays "rent" equal to principal plus interest. The tranche is covered by an ADB partial risk guarantee covering non-payment to IDB towards 50% of the amount for a period of 12 years. Source: http://www.aedb.org/wind.htm