SINGAPORE (March 28): China Everbright Water says a consortium led by the company has entered into joint venture and Public-Private Partnership (PPP) agreements for the Hubei Suizhou High-Tech Industrial Park Piaoshui and Fuhe River Basin Integrated Water Environment Restoration Public-Private Partnership Project, otherwise known as the Suizhou PPP Project.

The total investment amount for the Suizhou PPP Project is estimated to be RMB956 million (S$193.6 million). The investment amount will be contributed by the project company through internal resources and external financing.

The Suizhou PPP Project will involve the investment, financing, design, construction, operation and management and maintenance of the landscape and greeneries of both banks of the Fuhe River for a concession period of 13 years, including the two-year construction period.

An industrial wastewater treatment plant will also be built in Xihe County for a concession period of 25 years, including a one-year construction period, with phase I of the project designed to have a daily industrial wastewater treatment capacity of 10,000 cubic metres to comply with water quality standard not lower than the Chinese national Grade 1B standard.

The project will also see a pipeline network in the Xihe County of 53 kilometres in length. This will support and be connected to the wastewater treatment plant, for a concession period of 25 years, including a one-year construction period.

Finally, the project will include the landscape and water environment restoration of Piaoshui Park for a concession period of 13 years, including a three-year construction period.

Apart from China Everbright, the consortium involves Hubei Shuizong Water Resources & Hydropower Construction Co. and Beijing Orient Landscape & Environment Co.

The JV agreement was signed with Suizhou High-Tech Industry Investment Co. while the PPP agreement was signed with the construction bureau of the Suizhou Hi-Tech Industry Zone.

Under the JV agreement, the consortium members and Suizhou High-Tech, a wholly-owned subsidiary of the Suizhou municipal government will establish a joint venture company for the purposes of investing in, and undertaking the construction, operation and maintenance in relation to the Suizhou PPP Project.

China Everbright and Suizhou High-Tech will hold a 78.4% and 20% stake in the project company, with the remaining 1.6% stake to be held by the remaining consortium members. The project company will be established with a registered capital of RMB260 million (S$52.7 million).

During the relevant concession period for each of the sub-projects, the Construction Bureau of Suizhou Hi-Tech Industry Zone will pay to the project company service fees on an annual basis in accordance with the terms of the PPP agreement, except for the fees for the services rendered by the WWT Plant will be paid on a monthly basis.

The service fees for each of the sub-projects comprise an availability payment and a performance payment, each of which is subject to specific adjustment mechanisms throughout the relevant concession period.

The Suizhou PPP Project is expected to enhance long-term returns and value for shareholders of the company, says China Everbright.

Shares of China Everbright Water closed at 46 Singapore cents on Tuesday before the announcement.