A White & Case team is advising the Chinese banks funding the Guangdong LNG Terminal & Trunkline project financing.

Raj Pande is the partner leading the White & Case team on the financing, for which loan agreements were signed in Beijing. The US$880m financing follows the US firm's announcement that it has been awarded a licence by the PRC Government to open an office in Beijing.

The five Chinese banks that turned to White & Case are: Industrial and Commercial Bank of China; Agricultural Bank of China; China Construction Bank; China Development Bank; and Bank of China. ABN AMRO is serving as financial adviser.

The financing is for the development of a three million tonne LNG receiving, storage and regasification terminal and a 213km pipeline for gas distribution. Developed by BP and China National Offshore Oil Corporation (CNOOC), this is China's first LNG project and will supply gas to Shenzhen, Dongguang, Guangzhou and Foshan City-Town gas customers, to new power plants, to oil-to-gas power plants as fuel, and to Hong Kong gas users by two sub-sea pipelines owned and installed by the Hong Kong users.

Pande said the financing illustrated the expanded role of domestic banks in increasingly complex project finance arrangements in China. "The Guangdong LNG project financing represents precedent-setting participation by Chinese banks in a large-scale energy infrastructure project. Because they are flush with liquidity and motivated by state-led energy policies, the Chinese banks will likely take a more active role in project financings in the PRC and elsewhere in Asia."

Chinese banks have significant yuan and US dollar deposits available for lending, with recent reports indicating some 11 trillion yuan (US$1.3tn) in personal savings accounts and US$146bn in foreign exchange deposits.

Combined with the PRC's determination to establish the energy infrastructure required to fuel projected economic growth, this means Chinese banks are willing and able to lend to large-scale projects - even at lower non recourse loan margins.

White & Case received its Beijing licence from the PRC Ministry of Justice on 12 April. The office, which will be located on the 9th floor of the Beijing International Club Office Tower in the Chaoyang District, will focus on capital markets, M&A, venture capital and private equity, banking and finance, taxation and intellectual property.

The Beijing office is the firm's third in China following Shanghai (opened in 2001) and its China headquarters in Hong Kong (opened in 1978).

John Kuzmik, who leads the White & Case China practice, said: "Our Beijing office will provide us with even better access to government decision makers, as well as to the headquarters of China's largest corporations and financial institutions."