Project detail - LAKESIDE ENERGY (PRIVATE) LIMITED

Who is our customer

SPV Lakeside Energy (Private) Limited (“Lakeside”). The key Sponsor is Naveena Exports Limited. Naveena Exports Limited was founded in 1971 and is a conglomerate of companies active in denim (with clients as Levi’s, GAP, C&A, ZARA etc.), spinning, property development, steel and power. Lakeside is Naveena's subsidiary and the SPV that has been created to develop, finance, construct and operate a 50MW wind park in Pakistan.

What is our funding objective?

The senior debt will be dedicated to the development, construction and operation of a 50MW wind power plant in the District Thatta, Sindh, in the Islamic Republic of Pakistan. Total expected project costs are around USD 67m. FMO's financing in Lakeside is for up to USD 26.7m (acting as co-Lead Arranger) and parallel to the local commercial bank Faysal Bank Limited who participates with an equal amount of USD26.7m (in local currency).

Why do we fund this investment?

FMO provides the financing because this project will contribute to economic growth by adding low-cost and clean power in Pakistan, a country which is currently experiencing power shortages. Furthermore, FMO is additional in providing long-term USD finance which is otherwise not readily available in Pakistan.

What is the Environmental and Social categorization rationale?

The E&S Category is B+ mostly as it concerns a small-scale energy project, to be built in a sparsely populated, semi-arid area. As such, the potential adverse E&S impacts are limited and few in number, generally site-specific, largely reversible, and susceptible of being mitigated through readily available mitigation measures. FMO’s E&S Due Diligence indicated that the following Performance Standards (PSs) will have to be addressed: - PS1: Assessment and Management of Environmental and Social Risks and Impacts (including local communities’ expectations for jobs). - PS2: Labour and Working Conditions. Will cover aspects such as forced and child labour, the health and safety of construction workers, and worker accommodation-related issues. - PS3: Resource Efficiency and Pollution Prevention. - PS4: Community Health, Safety and Security. This includes (i) risks posed by the presence of security personnel in the area; and (ii) general construction nuisance (dust, noise, increased traffic) for nearby communities. - PS5: Land Acquisition and Involuntary Resettlement. A precautionary approach has been taken by triggering PS5, as it was not possible to completely rule out potential land acquisition legacy issues and minor economic displacement in the given timeframe. Suitable mitigants have been agreed should PS5 impacts be realised (see ESAP). The following PSs are not triggered: - PS6: Biodiversity Conservation and Sustainable Management of Living Natural Resources – management measures and monitoring, as per GIIP, are included in the ESMS. - PS7: Indigenous Peoples – nearby communities not characterised as IPs, following screening against the criteria established in the PS7 definition of IPs. - PS8: Cultural Heritage – management measures, as per GIIP, are included in the ESMS – no archaeological or cultural heritage artefacts and/or sites of national, local or community significance were found to be impacted; no graveyards have been identified within or adjacent to the Site. Still, a Chance Finds procedure will be developed. With regards to the cumulative impacts due to the development of multiple wind farms in the area, the Client will collaborate with wind developers in Jimphir Wind region to implement the outcomes defined by the Lenders sponsoring wind projects Region, including taking part in a collective management mechanism (ESAP). will also be continuously monitored and managed, namely the potential impacts on migratory birds.

More investments

Date	Total FMO financing
11/13/2019	USD 1.67 MLN